Shenzhen Cotran New Material Co.Ltd(300731) : Shenzhen Cotran New Material Co.Ltd(300731) special statement on the realization of the performance commitment of equity acquisition

Securities code: Shenzhen Cotran New Material Co.Ltd(300731) securities abbreviation: Shenzhen Cotran New Material Co.Ltd(300731) Announcement No.: 2022013 Shenzhen Cotran New Material Co.Ltd(300731)

Special note on the achievement of performance commitments for the acquisition of equity

The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.

Shenzhen Cotran New Material Co.Ltd(300731) (hereinafter referred to as “the company” and ” Shenzhen Cotran New Material Co.Ltd(300731) “) obtained 65.00% of the equity of Wuxi Kuncheng New Material Technology Co., Ltd. (hereinafter referred to as “Wuxi Kuncheng”) held by Shenzhen Huizhi Xinyuan venture capital enterprise (limited partnership) (hereinafter referred to as “Huizhi Xinyuan”) through equity transfer in 2019. In this equity acquisition, Huizhi Xinyuan made a commitment to the performance of Wuxi Kuncheng, and the implementation of its relevant performance commitments is described as follows:

1、 Basic information

On May 30, 2019, the 10th meeting of the second board of directors of the company deliberated and approved the proposal on changing the purpose of some raised funds and terminating some raised investment projects. After deliberated and approved by the 2018 annual general meeting of shareholders, the company agreed to invest 103.35 million yuan in cash to acquire 65.00% equity of Wuxi Kuncheng, The source of funds is the raised funds (including interest) of 825395 million yuan and its own funds of 208105 million yuan as of July 12, 2019, which are changed from the “production expansion sub project” of the original raised and invested project of the company’s initial public offering in 2017, “construction project of high-performance special rubber sealing materials”. After the completion of this transaction, the company holds 65.00% equity of Wuxi Kuncheng and obtains two of its three seats on the board of directors. Wuxi Kuncheng completed the industrial and commercial registration change procedures for the acquisition on June 27, 2019. After that, the company completed the payment of all the acquisition funds in accordance with the relevant cooperation agreement, and Wuxi Kuncheng became the holding subsidiary of the company.

See cninfo.com, the gem information disclosure website designated by China Securities Regulatory Commission, for the details above( http://www.cn.info.com.cn. )The announcement on the resolution of the 10th meeting of the second board of directors (Announcement No.: 2019056), the announcement on the acquisition of part of the equity and related party transactions of Wuxi Kuncheng New Material Technology Co., Ltd. (Announcement No.: 2019061), the resolution of the 2018 annual general meeting (Announcement No.: 2019069) Announcement on the progress of acquiring part of the equity and related party transactions of Wuxi Kuncheng New Material Technology Co., Ltd. (Announcement No.: 2019070, 2019082).

2、 Performance commitment

1. Performance commitment and performance commitment compensation

According to the equity transfer agreement of Wuxi Kuncheng New Material Technology Co., Ltd. between Shenzhen Cotran New Material Co.Ltd(300731) and Shenzhen Huizhi Xinyuan venture capital enterprise (limited partnership) signed by the company and Wuxi Kuncheng shareholder Huizhi Xinyuan, Wuxi Kuncheng shareholder Huizhi Xinyuan promises that the net profit of Wuxi Kuncheng in 2019, 2020 and 2021 (corresponding to the first, second and third years respectively) will not be less than 15 million yuan, 16 million yuan and 17 million yuan respectively; The net profit is calculated based on the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses; The compensation amount of each year shall be calculated as follows:

Total compensation cash in the current period = (cumulative committed net profit as of the end of the current period – cumulative actual net profit as of the end of the current period) ÷ total committed net profit during the profit commitment period × Underlying equity transaction price – cumulative compensated amount

If the compensation amount calculated according to the above calculation formula is less than 0, it is taken as 0, and the compensated amount will not be reversed.

If the actual net profit realized by Wuxi Kuncheng in 2019 exceeds the net profit of the year promised above, the excess part can offset part of the promised net profit in 2020 or 2021; If the actual net profit realized by Wuxi Kuncheng in 2020 exceeds the net profit of the current year promised above, the excess part can offset the part of the committed net profit in 2021. Huizhi Xinyuan does not need to compensate for the part of the committed net profit offset in accordance with the equity transfer agreement of Wuxi Kuncheng NEW Material Technology Co., Ltd. between Shenzhen Cotran New Material Co.Ltd(300731) and Shenzhen Huizhi Xinyuan venture capital enterprise (Co., Ltd.); For the avoidance of doubt, in any case, if the actual net profit realized in any fiscal year in the performance commitment period exceeds the promised net profit of the current year, the excess part shall not offset the promised net profit of the previous fiscal year. Huizhi Xinyuan shall compensate for the amount of promised net profit that cannot be met in the previous fiscal year.

2. Impairment compensation

Within six months after the expiration of the profit commitment period, the company and its relevant professional institutions will conduct impairment test on Wuxi Kuncheng and issue the impairment test audit report of Wuxi Kuncheng.

According to the impairment test review report, if Wuxi Kuncheng equity is impaired and the amount of impairment at the end of the profit commitment period is greater than the total amount compensated by Huizhi Xinyuan, Huizhi Xinyuan shall make another cash compensation to the company within 20 working days from the date of issuance of the impairment test review report.

Amount of impairment compensation = amount of impairment at the end of the period – total amount of performance commitment compensation paid by Shenzhen Huizhi Xinyuan venture capital enterprise (limited partnership)

3、 Completion of performance commitments of Wuxi Kuncheng in 2021

Notarial Tianye Certified Public Accountants (special general partnership) issued the special audit report of Shenzhen Cotran New Material Co.Ltd(300731) on the achievement of performance commitments on April 8, 2022. Wuxi Kuncheng achieved a net profit of 1796375579 yuan attributable to the shareholders of the parent company in 2021. After deducting non recurring losses and gains, the net profit attributable to the shareholders of the parent company was 1798412210 yuan, more than 98412210 yuan compared with the performance commitments of 1700000000 yuan, The completion rate of performance commitment in 2021 is 105.79%. The net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses accumulated from 2019 to 2021 is 5087872401 yuan, and the cumulative completion rate of performance commitments is 106.00%.

4、 Performance commitment compensation

Based on the achievement of Wuxi Kuncheng’s performance in 2021 and the cumulative achievement of performance from 2019 to 2021, Huizhi Xinyuan does not need to compensate the company in 2021 according to the calculation results of the performance commitment compensation calculation formula and relevant agreements.

5、 Documents for future reference

1. Resolution of the sixth meeting of Shenzhen Cotran New Material Co.Ltd(300731) the third board of directors; 2. Special audit report of Shenzhen Cotran New Material Co.Ltd(300731) on the achievement of performance commitments;

3. Other documents for future reference required by Shenzhen Stock Exchange.

It is hereby announced.

Shenzhen Cotran New Material Co.Ltd(300731) board of directors

April 9, 2002

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