Securities code: 603236 Securities abbreviation: Yiyuan Communication Announcement number: 2024-030
Shanghai SIMCom Communication Technology Co., Ltd. Announcement on the Expected Routine Related Transactions for the Year 2024
The board of directors and all directors of the company hereby guarantee that the contents of this announcement do not contain any false records, misleading statements, or major omissions, and assume legal responsibility for the truth, accuracy, and completeness of the contents.
Important content reminder:
- This routine related party transaction does not require submission to the company's shareholders' meeting for approval.
● Shanghai SIMCom Limited (hereinafter referred to as the 'Company' or 'SIMCom')'s daily related transactions are conducted on a fair basis in accordance with market rules, will not harm the legitimate rights and interests of the Company and all shareholders, will not affect the independence of the Company, will not form a dependence on related parties, and will not have an adverse impact on the Company's future financial condition and operating results.
● This routine related party transaction does not constitute significant adverse effects on industry competition.
1. Basic Information on Daily Related Transactions
(1) Review Procedures for Routine Related Party Transactions
- Independent Directors' Special Meeting Review
On July 5, 2024, the first special meeting of the third session of the Board of Directors of the company was held to review and approve the 'Proposal on the Expected Routine Related Transactions for the Year 2024'. All independent directors unanimously agreed to submit the proposal to the company's board of directors for review.
At the first special meeting of the third session of the Board of Directors, all independent directors believe that: The estimated routine related party transaction this time is a reasonable forecast based on the actual situation of the company, and the parties to the transaction follow the principles of fairness, impartiality, and equal value. The price of the related party transaction is fair and reasonable, in compliance with relevant laws and the Company's Articles of Association, does not harm the interests of the company and other shareholders, especially small and non-related shareholders, and will not affect the independence of the company.
- Board of Directors Deliberation
On July 5, 2024, the company held the nineteenth meeting of the third board of directors. With 4 votes in favor, 0 votes against, and 0 abstentions, the proposal on the expected daily related transactions for the year 2024 was approved. Mr. Qian Penghe, a related director, abstained from voting. This routine related transaction does not need to be submitted to the company's shareholders' meeting for approval.
- Deliberation of the Supervisory Board
On July 5, 2024, the company held the sixteenth meeting of the third board of supervisors, with 3 votes in favor, 0 votes against, and 0 abstentions, approving the 'Proposal on the Estimated Routine Related Transactions for the Year 2024.' The board of supervisors believes that the estimated routine related transactions for the year 2024 are in line with the company's daily operational development needs, and the implementation of related transactions will not have any adverse impact on the company's ongoing operational capabilities and independence, nor will it harm the interests of shareholders, especially small and medium-sized shareholders. The proposal was approved by all supervisors.
(2) Estimated and Executed Status of Routine Related Transactions for the Year 2023
Related Party Transactions Category
Related person
Expected amount in 2023 (RMB)
Actual amount occurred in 2023 (RMB)
Reasons for significant differences between the expected amount and the actual amount incurred
Sell products to associated persons
Beijing Baidu Hulian Technology Co., Ltd.
200,000.00
135,197.78
N/A
Note:
- Starting from February 18, 2023, Beijing Bairui Internet Technology Co., Ltd. is no longer a related party of the company. The 'actual amount incurred in 2023' mentioned above refers to the transaction amount from January 1, 2023, to February 17, 2023.
- The estimated amount of the above-mentioned related party transactions does not meet the standards for review and disclosure by the company's board of directors. The estimated amount is within the approval authority of the company's general manager, has been approved by the company's general manager's office meeting, and the company has completed the relevant approval procedures.
(3) Estimated Amount and Categories of Routine Related Party Transactions for the Year 2024
Related Party Transaction Category
Related person
This time the expected amount (ten thousand yuan)
Proportion of similar business (%)
The total transaction amount that has occurred between the beginning of the year and the disclosure date with related parties
Actual amount incurred last year
Proportion of similar business (%)
The reasons for the significant difference between the expected amount this time and the actual amount incurred last year
Sell products to associated persons
NETPRISMA SG PTE. LTD.
16,100.00
1.16
0
0
0
Last year did not occur
Purchase technical support services from related parties
NETPRISMA INC.
900.00
0.08
0
0
0
Last year did not occur
Note: The expected situation of the company's daily related transactions in 2024 may differ from the actual situation, and the company will act according to the actual
Trading conditions, credit adjustments can be made between different related parties under the same control (including subsequent newly established subsidiaries), including adjustments between different types of related transactions, with a total amount not exceeding the estimated amount.
二、Introduction of Related Parties and Explanation of Relationships
（一） NETPRISMA INC.
- Basic Information: The related party NETPRISMA INC. (hereinafter referred to as 'NETPRISMA') was registered and established on April 14, 2023, with a registered capital of $150,000, located at 1301 6TH AVE, SEATTLE, WA, 98101-2304, UNITED STATES, and the actual controller is Zekai Qian. The main business is wholesale trade. NETPRISMA has no significant issues affecting its solvency.
2、The latest financial data for the past year
Unit: yuan
Project
December 31, 2023/Year 2023 (unaudited)
May 31, 2024/May 1-5, 2024 (unaudited)
Total assets
921,136.65
7,497,052.80
Total liabilities
-
3,916,632.03
Net assets
921,136.65
3,580,420.77
Operating income
-
7,100,910.00
Net profit
-140,633.88
2,652,941.94
Asset-liability ratio
-
52.24%
（二） NETPRISMA SG PTE. LTD.
- Basic Information: The related party NETPRISMA SG PTE. LTD. (hereinafter referred to as 'NETPRISMA SG') was registered and established on March 19, 2024, with a registered capital of $200,000, located at 6 RAFFLESQUAY #14-02 SINGAPORE (048580), and the actual controller is Zekai Qian. The main business is the sale of electronic components, other electronic components, and circuit board manufacturing. NETPRISMA SG has no significant issues affecting its solvency.
2、Recent Key Financial Data
NETPRISMA SG was registered and established on March 19, 2024, with the following key financial data as of May 31, 2024:
Project
May 31, 2024/May 1-5, 2024 (unaudited)
Total assets
1,421,582.28
Total liabilities
106,632.00
Net assets
1,314,950.28
Operating income
-
Net profit
-106,691.17
Asset-liability ratio
7.50%
The relationship between the above-mentioned related parties and the company: The actual controller of NETPRISMA and NETPRISMA SG is Zekai Qian, who is the son of Zekai Qian, a shareholder and actual controller of Unigroup. Therefore, NETPRISMA and NETPRISMA SG are considered related parties of the company.
Performance Capability: The above related parties are all in existence and operating normally in accordance with the law, with good financial and credit conditions, and have good performance capability. The company will sign relevant contracts or agreements with the above transactions and related parties and strictly abide by the agreements, with legal protection for both parties' performance.
Three, main content and pricing policy of related party transactions
NETPRISMA, NETPRISMA SG, and any future NETPRISMA subsidiaries controlled by Zekai Qian (hereinafter referred to as the 'NETPRISMA Group') have their own management, technical, and sales teams, operating independently. Their cooperation with Quectel focuses on overseas markets. Potential cooperation methods include: (1) The NETPRISMA Group purchasing Quectel's products for sale to customers; (2) The NETPRISMA Group collaborating with Quectel and processing companies for production, with the products sold to customers by the NETPRISMA Group; (3) Quectel procuring market promotion and technical support services from the NETPRISMA Group.
Subsequently, both parties will sign relevant transaction agreements in accordance with the principles of equality, fairness, and impartiality. The pricing of related transactions will be based on market prices, following the principles of fairness, reasonableness, and mutual agreement. The selling price of MoveFar Communication to NETPRISMA Group is not different from historical pricing of similar comparable businesses, ensuring a fair transaction price that will not harm the interests of the company and all shareholders.
Four, Purpose of Related Party Transactions and Their Impact on the Company
(1) Purpose of Related Party Transactions
The company's daily related transactions for the year 2024 are expected to be reasonably estimated based on international market dynamics, the company's development strategy, and the actual needs of daily operations, in line with the company's production and operation as well as long-term development strategy, conducive to the company's smooth expansion in overseas markets, and to promote the company's long-term sustainable development.
(2) Impact of Inter-industry Competition
- Some business areas have cross-overlapping
The main business of Quectel involves the design, research and development, production, and sales services of wireless communication modules and solutions in the field of Internet of Things, providing a one-stop solution including wireless communication modules, antennas, and software platform services. The main business of NETPRISMA INC. is wholesale trade. The main business of NETPRISMA SG PTE.LTD. is the sale of electronic components, other electronic elements, and circuit board manufacturing. In the future, NETPRISMA Group will purchase products from Quectel for sale to customers or collaborate with Quectel and processing companies to produce and sell to customers. This collaboration is aimed at better promoting the overseas market development of the company. Although there is some business overlap, it does not constitute a substantial competitive relationship.
- Solution
(1) According to the future global business layout and planning of NETPRISMA Group, its business will gradually expand outward, and the diversified business forms and product structure will gradually reduce the overlapping relationship with MiYuan Communication.
（2）NETPRISMA Group and Quectel have independence in assets, personnel, technology, and finance, with a complete business system and the ability to operate independently.
(3) It is expected that the amount of products sold by YIMI Communication to NETPRISMA Group in the future will account for a small proportion of YIMI Communication's overall sales business, and YIMI Communication will not become dependent on related parties.
In conclusion, there is no significant adverse impact on competition between Yonyou Communication and NETPRISMA Group.
(3) Impact of Related Party Transactions
NETPRISMA Group's cooperation with Quectel follows market fairness and transparent compliance principles, strictly adhering to the relevant regulations on pricing of related-party transactions. The transactions between the company and the related parties are conducted on a fair basis in accordance with market rules, ensuring that they do not harm the company and the legitimate rights and interests of all shareholders, do not affect the company's independence, do not create dependence on related parties, and do not have adverse effects on the company's future financial condition and operating results.
Special notice.
Shanghai SIMCom Limited Board of Directors
July 6, 2024