GCL Poly Energy : Announcements and Notices - Discloseable Transaction with China Construction Third Engineering Bureau First Construction Project Co. Ltd

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GCL-Poly Energy Holdings Limited

保利協鑫能源控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 3800) GCL New Energy Holdings Limited

協鑫新能源控股有限公司

(Incorporated in Bermuda with limited liability)

(Stock code: 451) DISCLOSEABLE TRANSACTION WITH CHINA CONSTRUCTION THIRD ENGINEERING BUREAU FIRST CONSTRUCTION PROJECT CO. LTD THE DISCLOSEABLE TRANSACTION

On 28 June 2016, the GNE Group entered into the following agreements with China Construction (an independent third party of GCL-Poly and GNE):

1. the Haifeng Construction Agreement between Haifeng GCL (an indirect subsidiary of GCL- Poly and an indirect wholly-owned subsidiary of GNE) as principal and China Construction as contractor in relation to construction services for the Haifeng Project at an estimated consideration of RMB76,101,400.00 (equivalent to approximately HK$88,764,672.96);

2. the 32MW Haifeng Module Supply Agreement entered into among Haifeng GCL as principal, Nanjing GCL New Energy as supplier and China Construction as customer in relation to the sale and purchase of 310-watt solar modules for the Haifeng Project (the "32MW Modules") at an estimated consideration of RMB134,960,282.50 (equivalent to approximately HK$157,417,673.51);

3. the 32MW Haifeng Module Purchase Agreement entered into between China Construction as supplier and Haifeng GCL as customer in relation to the sale and purchase of the same batch of 32MW Modules acquired by China Construction under the 32MW Haifeng Module Supply Agreement (as described above) at an estimated consideration of RMB135,095,243.00 (equivalent to approximately HK$157,575,091.44);

4. the 72MW Haifeng Module Supply Agreement entered into among Haifeng GCL as principal, Nanjing GCL New Energy as supplier and China Construction as customer in relation to the sale and purchase of 310-watt solar modules for the Haifeng Project (the "72MW Modules") at an estimated consideration of RMB299,700,467.00 (equivalent to approximately HK$349,570,624.71); and

5. the 72MW Finance Lease Agreements pursuant to which (i) Zhujiang Financial Leasing will purchase the same batch of 72MW Modules acquired by China Construction under the 72MW Haifeng Module Supply Agreement (as described above) for an estimated consideration of RMB300,000,000.00 (equivalent to approximately HK$349,920,000.00); and (ii) Zhujiang Financial Leasing will then lease the same 72MW Modules to Haifeng GCL for a term of two years for an aggregate rent estimated to be RMB324,787,682.00 (equivalent to approximately HK$378,832,352.28),

(together, the"Haifeng Agreements"). LISTING RULE IMPLICATIONS

As one or more of the applicable percentage ratios in respect of the Haifeng Agreements exceeds 5% but is less than 25% for GCL-Poly and GNE, the entering into of the Haifeng Agreements constitutes a discloseable transaction of GCL-Poly and GNE and GCL-Poly and GNE shall comply with the reporting and announcement requirements under Chapter 14 of the Listing Rules.

1. DISCLOSEABLE TRANSACTION WITH CHINA CONSTRUCTION
2. Principal terms of the Haifeng Construction Agreement

3. Date

   28 June 2016

4. Parties

   Principal: Haifeng GCL

   Contractor: China Construction

5. Subject matter

   Haifeng GCL as principal agreed to engage China Construction as contractor to provide construction services, including module procurement services, in relation to the Haifeng Project.

   The Haifeng Project is expected to complete 10MW of on-grid power connection by 30 June 2016, and to complete full on-grid power connection and obtain the Test Run and Quality Check Certificate* (工程試運和移交生產驗收鑒定書) by 30 October 2016. The Construction Completion Certificate* (工程竣工驗收鑒定書) will be obtained within 3 months after the Test Run and Quality Check Certificate is issued.

6. Consideration

   The total consideration under the Haifeng Construction Agreement is estimated to be RMB76,101,400.00 (equivalent to approximately HK$88,764,672.96), comprising:

7. RMB65,374,400.00 (equivalent to approximately HK$76,252,700.16) for the installation and construction services for the Haifeng Project; and

8. RMB10,727,000.00 (equivalent to approximately HK$12,511,972.80) for the site preparation and road maintenance services for the Haifeng Project.

   The Haifeng Construction Agreement was negotiated and entered into on an arm's length basis and on normal commercial terms. The consideration was determined with reference to

9. the quality standard and cost of the services under the Haifeng Construction Agreement;

10. the expected profit margin of the Haifeng Project; and (c) the prevailing market price of similar services.

11. Payment terms

The consideration for services under the Haifeng Construction Agreement shall be paid by Haifeng GCL to China Construction in accordance with the following milestones:

First instalment 10% of the consideration as prepayment within 15 days of the Haifeng Construction Agreement coming into effect, provided that: (i) China Construction has provided a bank guarantee to cover for China Construction's liabilities under the Haifeng Construction Agreement effective for 8 months for up to 10% of the consideration in case China Construction breaches the Haifeng Construction Agreement; and (ii) China Construction has entered or is ready to enter the construction site;

Second instalment up to 20% of the consideration within 10 days of Haifeng GCL receiving an invoice from China Construction, provided that China Construction completes the initial on-grid power connection and the installation of 20MW of solar modules for the Haifeng Project before 30 June 2016;

Third instalment up to 40% of the consideration within 10 days of Haifeng GCL receiving an invoice from China Construction after China Construction completes 60MW of on-grid power connection for the Haifeng Project;

Fourth instalment up to 90% of the consideration within 10 days of Haifeng GCL receiving an invoice from China Construction within three months after the full on-grid power connection of the Haifeng Project (or if, due to reasons not caused by China Construction, the Haifeng Project has not yet achieved full on-grid connection then the Haifeng Project having met all criteria for full on-grid connection);

Fifth instalment up to 95% of the consideration within 10 days of Haifeng GCL receiving an invoice from China Construction after inspection and acceptance of all construction work; and

Sixth instalment the remaining 5% of the consideration as retention money within one month after the expiration of the warranty period of 12 months after completion and acceptance of all construction work, provided that there are no quality issues with the services, or any issues have been remedied by China Construction.

Haifeng GCL shall make all land in relation to the Haifeng Project available to China Construction before 31 August 2016. If Haifeng GCL is not able to make the relevant land available by such date, from 1 September 2016 onwards, Haifeng GCL shall only make monthly payments to China Construction calculated based on 80% of the actual on-grid power connection work done for the Haifeng Project at the rate of RMB0.5837/W.

Haifeng GCL may defer payment of the consideration under the Haifeng Construction Agreement (excluding the first instalment) by up to 5 months after full on-grid connection of the Haifeng Project, but in any case not exceeding 31 December 2016. If Haifeng GCL defers payment of consideration, Haifeng GCL shall pay daily interest equal to: amount of payment deferred × 7% ÷ 365.

12. Principal terms of the 32MW Haifeng Module Supply Agreement

1. Date

   28 June 2016

2. Parties

   Supplier: Nanjing GCL New Energy Customer: China Construction

   Principal: Haifeng GCL

3. Subject Matter

   Nanjing GCL New Energy agreed to supply, and China Construction agreed to purchase, the 32MW Modules at an estimated consideration of RMB134,960,282.50 (equivalent to approximately HK$157,417,673.51), which will be subject to adjustment at settlement based on the actual quantity used on completion of the Haifeng Project.

   The 32MW Modules will be delivered to Haifeng GCL in accordance with the 32MW Haifeng Module Purchase Agreement (as described below) and will be used for the Haifeng Project. Haifeng GCL is the principal of the Haifeng Project.

4. Basis of consideration

The 32MW Haifeng Module Supply Agreement was negotiated and entered into on an arm's length basis and on normal commercial terms. The consideration is calculated on the basis of the market price of similar products.