CIMC Enric Holdings Limited entered into the master sales agreement with CIMC (China International Marine Containers (Group) Co. Ltd.) on December 31, 2019. Sale of products for storage, transportation and processing in the fields of clean energy, chemical and environmental and liquid food, spare parts and raw materials for production, as well as components for construction projects (including but not limited to natural gas refueling stations and related equipment, natural gas refueling station trailers, CNG seamless pressure cylinders, CNG trailers, natural gas compressors, LNG trailers and tanks, on-vehicle LNG fuel tanks, cryogenic liquefied gas tanks, compressed specialised gas trailers, tank containers for chemical liquids, liquefied gas and cryogenic liquids, and stainless steel processing, storage tanks for liquid food, vehicle chassis, vehicle platforms, operating system, steel and waste and surplus materials) by the Group to the CIMC Group for a period of three years commencing on 1 January 2020 and expiring on 31 December 2022. The sale of the products by the Group to the CIMC Group is for the purposes of (i) enabling the CIMC Group to provide finance leases to the Sales Customers (who are customers of the Group that require finance leases to purchase the products and are referred by the Group to the CIMC Group for that purpose) and/or (ii) the CIMC Group's own manufacturing and business operations. The relevant member(s) of the Group and the relevant member(s) of the CIMC Group will enter into separate contract(s) with respect to the individual transactions contemplated under the Master Sales Agreement (2019) in accordance with the principal terms set out therein. In particular, in case where products of the Group are sold to the CIMC Group for the purpose of enabling the latter to provide finance leases to the Sales Customers, separate tripartite contracts will be entered into among the Sales Customer, the relevant member(s) of the Group and of the CIMC Group, under which the relevant member(s) of the CIMC Group will covenant to pay for the products to be provided by the relevant member(s) of the Group. The terms, including the payment terms, will be determined on a transaction-by- transaction basis, and on normal commercial terms, or on terms no less favorable to the Group than terms available to Independent Third Parties. The price of the products contemplated under the Master Sales Agreement (2019) will be determined in accordance with the estimated cost to be incurred in providing the relevant products (including the estimated cost of raw materials, depreciation of premises/building/equipment used in producing the products, the costs of labour, other incidental costs and the relevant taxes) plus an appropriate profit margin, to be agreed between the Group and the CIMC Group with reference to the profit margin obtained by the Group when the same type of products are provided by the Group to the Independent Third Parties and the price offered by the Group's counterparts to their customers for the same type of products at or near the same area in the ordinary course of business and on normal commercial terms. The Group maintains a minimum target gross profit margin for all products on the Product Price List (as defined below in the section headed "E. Internal control measures"), which is equally applicable for sales to both the CIMC Group and Independent Third Parties when negotiating prices. Regarding the sale of products to the CIMC Group for the purpose of enabling it to provide finance leases to the Sales Customers, within 10 days following the entering into of a tripartite contract for each individual transaction among the Sales Customers, the relevant member(s) of the CIMC Group and of the Group, the CIMC Group will pay 10% of the consideration thereunder as deposit to the Group. The balance of the consideration will be paid within 30 days from the date of acknowledgement of receipt of the products by the CIMC Group or the relevant Sales Customers. Upon the entering into each tripartite individual contract, in line with the usual terms of the contracts between the Group and Independent Third Parties, the Group will provide a one-year quality guarantee to the Sales Customer during which the Group will provide free repair and maintenance services to the Sales Customer. The historical transaction amounts respectively for the two years ended 31 December 2018 and the six-month period ended 30 June 2019 was significantly lower than the projected amounts for the corresponding years as some customers selected to purchase the Groups' products directly and/or through financing provided by other financial institutions. It is expected that the actual transaction amount for the year ending 31 December 2019 will not exceed the proposed annual cap for the corresponding year. The entering into of the Master Sales Agreement (2019) can help maintain an additional source of revenue for the Group. The Master Sales Agreement (2019) also facilitates Sales Customers in financing their purchase of the Group's products. Since the Group does not provide any finance leasing services, Sales Customers of the Group who may have difficulties in obtaining financing from independent commercial banks or financial institutions may require finance leasing services provided by the CIMC Group in purchasing the Group's products. Pursuant to the Master Sales Agreement (2019), the Group may refer Sales Customers to the CIMC Group to arrange such finance leases for Sales Customers to pay for the purchase of products. The Master Sales Agreement (2019) will thus enable the Group to retain customers who otherwise might not have the financial resources to purchase the Group's products and thereby increase the Group's revenue. The Directors (including the independent non-executive Directors) believe that (i) the terms of the Master Sales Agreement (2019) and the continuing connected transactions thereunder are in the ordinary and usual course of business of the Group, on normal commercial terms and no less favourable to the Group than those of Independent Third Parties; and (ii) the terms of the Master Sales Agreement (2019), the continuing connected transactions thereunder and the relevant proposed annual caps are fair and reasonable and in the interests of the Company and the Shareholders as a whole.