Jiangsu Rainbow Heavy Industries Co.Ltd(002483) : Announcement on the signing of sales contracts by holding subsidiaries

Securities code: 002483 securities abbreviation: Jiangsu Rainbow Heavy Industries Co.Ltd(002483) Announcement No.: 2022-002 Jiangsu Rainbow Heavy Industries Co.Ltd(002483)

Announcement on the signing of sales contracts by holding subsidiaries

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.

Special risk tips:

1. According to the contract, the contract adopts installment payment, which may lead to the risk that the subsequent company cannot collect on time due to the buyer’s breach of contract and other factors.

2. During the performance of the contract, there may be a risk that the gross profit margin will decline due to the further increase of raw materials, equipment and labor costs.

3. During the execution of the contract, there may be a risk that the contract products cannot be delivered on time due to factors such as the company’s technology, project management and core personnel turnover, resulting in the failure of contract performance.

4. The performance period of this contract spans five fiscal years, the performance cycle is long, and the contract amount is large. The contract may have the risk of non execution or partial non execution of the contract due to various uncertain factors (including but not limited to political, trade restrictions and other force majeure factors).

5. Due to the arrangement of contract payment schedule, although the payment arrangement is relatively good, due to the large total contract amount, it may occupy part of the company’s funds and have a certain impact on the company’s cash flow.

6. During the performance of the contract, there may be a risk that the company will not be able to receive the relevant contract payment on time or even fail to perform the contract due to the failure of issuing the relevant bank guarantee in time.

7. The contract is settled in Euro, which may have certain exchange rate risk.

8. The performance period of this contract spans five fiscal years, and the average annual contract amount accounts for about 36.29% of the company’s audited operating revenue in 2020, which will have a certain impact on the company’s operating performance in 2022 and in the future.

1、 Contract signing overview

Recently, Koch solutions GmbH (hereinafter referred to as “Koch company” or “Contractor”) and the National Center of Meteorology (NCM) of the United Arab Emirates (hereinafter referred to as “UAE”) (i.e. the National Meteorological Administration of the UAE, hereinafter referred to as “NCM” or “customer”) are the holding subsidiaries of Jiangsu Rainbow Heavy Industries Co.Ltd(002483) (hereinafter referred to as “company” or “the company”) The equipment supply, construction and commissioning contract (hereinafter referred to as the “contract”) was signed in Abu Dhabi. According to the contract, Koch will provide NCM with seven sets of bulk material handling equipment systems and on-site installation and commissioning services. The total contract price is

911068458.00 euros (calculated according to the central parity rate of euro against RMB on January 20, 2022, which is about 6559146300 yuan), accounting for 181.46% of the company’s audited operating revenue in 2020, and the average annual contract amount accounts for 36.29% of the company’s audited operating revenue in 2020. According to relevant regulations, Koch company of Germany signed the above sales contract this time, and the company does not need to perform other internal approval procedures. 2、 Introduction to counterparty

1. Customer Name: National Center of Meteorology (NCM). 2. Director: H.E. Dr. Abdullah Ahmed al mandous.

3. Registered at: Al shawamekh, P.O.Box: 4815, Abu Dhabi, UAE (al shawamekh, Abu Dhabi, UAE).

4. Time of establishment: 2007.

5. Business introduction: the National Meteorological Administration of the United Arab Emirates focuses on all disciplines related to the provision of meteorological and seismic engineering services implemented by relevant government departments.

6. Neither the company nor its holding subsidiary Koch of Germany has any relationship with NCM. NCM has the ability to perform.

7. In July 2021, Koch company of Germany signed the equipment supply, construction and commissioning contract with NCM, with a total contract price of 24191004.60 euros. For details, please refer to the announcement on the signing of sales contracts by holding subsidiaries (Announcement No.: 2021-072) disclosed by the company on cninfo.com and other designated information disclosure media on July 14, 2021. As of the disclosure date of this report, the above sales contracts are under normal performance. 3、 Introduction to Koch company in Germany

1. Name: Koch solutions GmbH (i.e. Koch Co., Ltd.).

2. Registered address: Karl Koch strae 166787 wadgassen, Germany (i.e. 1 Karl Koch Strauss street, 66787 wadgasen, Germany).

3. Registration number: HRB 104899.

4. Enterprise type: limited liability company.

5. CEO: J ü rgen Maier.

6. Business scope: technical R & D, design, product sales and consultation, after-sales service of various material handling equipment and hoisting equipment, procurement and trade of supporting parts of various handling equipment and hoisting equipment.

7. Date of establishment: August 30, 2018.

8. Relationship with the company: Gema (Germany) holding GmbH (i.e. Gema (Germany) Holding Co., Ltd.), a German wholly-owned subsidiary of Nantong Runbang Heavy Machinery Co., Ltd. (hereinafter referred to as “Runbang heavy machinery”), a wholly-owned subsidiary of the company, holds 51% equity of German Koch company, that is, German Koch company is the holding grandson of the company.

1. The contractor will provide NCM with seven sets of bulk material handling equipment systems. The Contractor shall design, purchase, manufacture and CIF deliver the equipment system to the wharf designated by the customer according to the contract requirements, and provide on-site general assembly and commissioning services after the customer completes customs clearance and inland transportation.

2. Total contract price and payment arrangement: the contract price is 911068458.00 euros. The customer shall pay the contract price in accordance with the relevant terms of the contract, specifically 25% advance payment after the contract comes into force, 45% advance payment when the equipment starts manufacturing, 10% progress payment after the equipment is shipped in the bill of lading, 15% progress payment when the final assembly starts, and 5% balance payment after the equipment is accepted. Within 45 days after receiving the relevant invoice, the customer shall pay the amount due and payable under any invoice to the bank account designated by the contractor in accordance with the terms of the contract. Meanwhile, as one of the payment terms, the contractor will issue an advance payment guarantee of 25% of the total contract price, a performance guarantee of 5% of the total contract price and a quality guarantee of 5% of the total contract price in accordance with the contract payment requirements.

3. Completion time clause: the completion time of seven sets of equipment systems is 30 months from the date of receiving the down payment of each set of equipment to 54 months. Each set of equipment and system can be accepted independently.

4. Terms of liquidated damages for delay: if the Contractor fails to deliver the goods according to the completion time required by the contract, it shall pay liquidated damages for delay of relevant works to the customer as required, and the delay penalty of all equipment systems shall be limited to 5% of the contract price; If the construction period is delayed due to the customer, the contractor has the right to extend the corresponding time.

5. The delivery terms of the equipment system are: CIF delivery at the port of destination designated by the UAE.

6. The contract shall come into force from the signing date of the contract and shall continue until the expiration of the final warranty period of the equipment and systems supplied under the contract unless terminated in advance. Each party has the right to terminate the contract by written notice in the event that the other party is unable to repay its debts or insolvent, liquidation or dissolution, which shall take effect immediately; The customer has the right to notify the contractor in writing to terminate the contract when the contractor has agreed major breach of contract, and the contractor has the right to notify the customer in writing to terminate the contract when the customer is insolvent and the customer does not pay. The Contractor shall be entitled to claim undisputed payment from the customer in the contract price for any equipment for which payment has not been received, and the customer shall return all guarantees to the contractor.

7. The contract and any non contractual obligations arising out of or in connection with it shall be governed by and construed in all respects in accordance with the laws of the United Arab Emirates of the emirate of Abu Dhabi.

8. Any dispute that cannot be settled by both parties shall be submitted to arbitration and finally settled in accordance with the arbitration rules issued by the London Court of international arbitration. The place of arbitration or legal place shall be Abu Dhabi Commercial mediation and Arbitration Center (adccac).

9. The contractor subcontracts the equipment system manufacturing works to Runbang heavy machinery.

5、 Analysis of contract performance ability and its impact on the company

1. Koch company of Germany has been committed to providing overall solutions for heavy bulk material system in coal, iron, bauxite, copper and other fields for many years. Relevant project teams are experienced and have stable professional and technical ability and level. Koch company of Germany has the ability to perform the contract.

The equipment system manufacturing project of the contract products is undertaken by Runbang heavy machinery. Runbang heavy machinery project has rich experience, complete equipment and facilities, advanced large-scale production workshop and machining workshop, and the existing capacity can fully meet the output demand of the project. In addition, the 60000 square meter large general assembly site and the 50000 ton International Open terminals of Qidong and Taicang owned by the company can meet the needs of general assembly, commissioning and shipment of various large equipment under the contract.

2. The performance period of this contract spans five fiscal years, and the average annual contract amount accounts for about 36.29% of the company’s audited operating revenue in 2020, which will have a certain impact on the company’s operating performance in 2022 and in the future.

3. By performing the above contracts, the company will further enhance its competitiveness in the market of material handling equipment, especially bulk equipment, and help the company further expand relevant markets in the future.

4. The signing of the contract has no significant impact on the independence of the company’s business, and there is no dependence on NCM due to the performance of the contract.

6、 Risk tips for contract performance

1. According to the contract, the contract adopts installment payment, which may lead to the risk that the subsequent company cannot collect on time due to the buyer’s breach of contract and other factors.

2. During the performance of the contract, there may be a risk that the gross profit margin will decline due to the further increase of raw materials, equipment and labor costs.

3. During the execution of the contract, there may be a risk that the contract products cannot be delivered on time due to factors such as the company’s technology, project management and core personnel turnover, resulting in the failure of contract performance.

4. The performance period of this contract spans five fiscal years, the performance cycle is long, and the contract amount is large. The contract may have the risk of non execution or partial non execution of the contract due to various uncertain factors (including but not limited to political, trade restrictions and other force majeure factors).

5. Due to the arrangement of contract payment schedule, although the payment arrangement is relatively good, due to the large total contract amount, it may occupy part of the company’s funds and have a certain impact on the company’s cash flow.

6. During the performance of the contract, there may be a risk that the company will not be able to receive the relevant contract payment on time or even fail to perform the contract due to the failure of issuing the relevant bank guarantee in time.

7. The contract is settled in Euro, which may have certain exchange rate risk.

The company will reduce and avoid various risks that may be encountered during the performance of the contract by strengthening project management and cost control, optimizing fund allocation, purchasing forward foreign exchange settlement and sales, purchasing export credit insurance, and strengthening close communication with relevant parties of the contract.

It is hereby announced.

Jiangsu Rainbow Heavy Industries Co.Ltd(002483) board of directors

January 21, 2022

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