Stock Code: 200771 Stock ID: Hangqilun B Announcement No. 2017-036
Announcement of Hangzhou Steam Turbine Co., Ltd.
on External Guarantee
The members of the Board and the Company acknowledge being responsible for the truthfulness, accuracy, and completeness of the announcement. Not any false record, misleading statement or significant omission carried in this announcement.
Ⅰ. Overview of the Guarantee
1. Overview
In order to meet the liquidity needs arising from the production and operation, Hangzhou Guoneng Steam Turbine Engineering Co., Ltd (which is the subsidiary of thecompany’s subsidiary-Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd, hereinafter referred to as: Guoneng Company) made an application to CITIC Bank Hangzhou Branch for the credit loan, of which the credit line is RMB 100 million with a term of one year. Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd provided guarantee for the credit line with the guarantee mean in joint liability.
2. Basic information of the guarantee
Guarantor: Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd
The Guaranteed: Hangzhou Guoneng Steam Turbine Engineering Co., Ltd.
Creditor: CITIC Bank Hangzhou Branch
Maximum guaranteed amount: RMB 100 million
Guarantee mean: Joint-liability guarantee
3. Approval procedure of the guarantee
The Proposal on the Guarantee Provided by theCompany’s Subsidiary- Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd for theCompany’sSubsidiary’s Subordinate Company- Guoneng
Company was approved in the 9th meeting of the 7th term of board of directors on April 25, 2017, and there were 11company’s directors participated in the vote, resulted in 11 votes of assent, 0
dissenting vote and 0 vote of abstention. For details, please refer to the "Announcement on
Resolutions of the 9th meeting of the 7th term of the Board " (Announcement No.2017-32).
According to the Stock Listing Rules on Shenzhen Stock Exchange and relevant regulations, the above-said guarantee provided by Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd for
Guoneng Company is not an included situation that needed to be examined and approved in the general shareholder meeting, and does not constitute a related transaction, thereforethere’s no need for approval from the relevant government department.
Ⅱ. Basic Information about the Guaranteed
1. Company Name: Hangzhou Guoneng Steam Turbine Engineering Co., Ltd.
2. Date of establishment: December 7, 2006
3. Place of registration:No.10 Tangwang Street, Tangqi Industry Area, Yuhang District, Hangzhou. 4. Legalrepresentative：Yu Changquan
5. Registered capital: RMB 40 million
6. Business scope: Design, manufacturing, technical services, technology consultation: steam turbine auxiliary equipment and spare parts
7.The relationship with the company: Hangzhou Guoneng Steam Turbine Engineering Co., Ltd. is the subsidiary of Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd and Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd holds75% stake of Guoneng Company; the company holds87.53% stake of Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd.
8.The guarantor of the recent financial situation:
In RMB
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|-|-|-|-|-|-|-|
|Period|Main operatingincome|Total profit|Net profit|Net assets|Total assets|Liabilityratio|
|January-March2017|113,885,642.31|8,823,108.1|7,519,836.75|127,767,207.54|421,907,679.15|69.72%|

Ⅲ.The main contents of the guarantee agreement
The main contents of the Maximum Amount Guarantee Contract signed between the Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd and CITIC Bank are as follows:
1.Maximum guaranteed amount: RMB 100 million
2.Guarantee mean: Joint-liability guarantee
3.Guarantee scope: Including but not limited to litigation costs, arrears fees, attorneys' fees, travel expenses, assessment fees, transfer fees, security), the right to recover the goods, Fees, promulgation fees, enforcement fees, etc.) and all other fees payable.
4.Guarantee period: Two years commenced from the date of the expiration of the occurrence
period of the principal claim.
5.The debt period of the principal contract: April 2017 to April 2018
IV. Opinions from Board of Directors
GuonengCompany’s application for credit extension loan from China CITIC Bank is to satisfy its demand for current capital, capital for supporting its production and operation, and issuing various kinds of bank guarantees. As its parent company, Fuji Company can solve the current capital problem by guaranteeingGuoneng’s credit extension loan of RMB 100 million, thus satisfyingGuoneng’s capital demand for production and operation. The board of directors executes the deliberation procedure per the rules and regulations and ensures that the guarantee is legitimate.
Guoneng Company maintains a relatively good record in aspects of asset quality, operation condition, industry prospect, debt paying ability and credit status. The board holds that guaranteeing itwon’t have any negative effect on the company.
Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd has already signed a counter guarantee agreement with Guoneng Company, which stipulates that Guoneng Company provide equal guarantee for Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd. The terms and conditions as stipulated in guarantee agreement comply with the principle of fairness and equality. V. Cumulative Amount of External Guarantee and Amount of Overdue Guarantee
By this announcement date, the accumulative amount of external company by the company and its holding subsidiary is RMB 378 million, taking up 5.6% of the audited net capital in 2016 which amounts to RMB6,745,622,670.52.
The company has no overdue guarantee. And it has no litigation-involved guarantee amount or amount of loss resulting from failing guarantee-related litigation.
VI. Documents available for inspection
1.The Resolutions of the 9th Meeting of the 7th Term of Board;
2.Contract on Guaranty of Maximum Amount signed by Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd and China CITIC Company;
3.Counter Guarantee Contract signed by Hangzhou Steam Turbine Auxiliary Equipment Co., Ltd and Hangzhou Guoneng Steam Turbine Engineering Co., Ltd.
The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
April 26, 2017