Announcement: Decision to Partner with Shenzhen Qianhai Ruilin Investment Management Firm (Limited Partnership) to Invest in Qingdao Cotte 1. Investment Overview To further develop the smart home industry chain, HeT partners with Shenzhen Qianhai Ruilin Investment Management Firm (limited partnership) (hereinafter Qianhai Ruilin) to invest in Qingdao Cotte Intelligence Co., Ltd. (hereinafter Qingdao Cotte). Qingdao Cotte is a leading company in the custom-made clothes industry. Its early implementation of the 4th Industrial Revolution concept has received great operational success and social feedback. Cotte created the RCMTM information system to manage processes from ordering, design, production, and operations management. Investing in Cotte is a part of HeT’s comprehensive internet and big data platform strategy.
Qianhai Ruilin has confirmed the total investment to be 110,000,000 Yuan. To break it down, Shenzhen Eastern Ruizhe Wealth Management Co., Ltd. (hereinafter Eastern Ruizhe) pledged 53,000,000 Yuan as a general partner. Shenzhen Koradior Fashion pledged 30,000,000 Yuan as a limited partner. Hangzhou Xinshen Stock Investment Partnership Firm pledged 7,000,000 Yuan as a limited partner. HeT pledged 20,000,000 Yuan for the investment. All investments are paid for by private funds from all the partners. Qianhai Ruilin will hold 2,166,112 shares out of 43,322,222 shares (5% of total shares) from Qingdao Cotto for 100,000,000 Yuan.
This investment was discussed and passed on the HeT’s third Board of Directors Meeting Session 23. It is within the decision rights of the board of directors, not concerning the shareholders’ meeting. It is not a related party transaction; nor does it require any permission by government agencies for major assets restructuring under The Listed Company Major Assets Restructuring Law. HeT will publish all necessary information according to the Corporate Law, Shenzhen Stock Exchange regulations and other rules and memos.
2. Partners Information i. Partnering company’s basic information Company name: Shenzhen Qianhai Ruilin Investment Management Firm LP Company address: First Qianwan Rd. 1, Building A Room 201, Shenzhen-Hong Kong Cooperation Zone, Qianhai Dist. Shenzhen Founding date: December 3rd, 2015 Registration number: 91440300359420466U ii. Investing partners’ basic information 1) General partner: Shenzhen Eastern Ruizhe Wealth Management Co., Ltd. Address: Rongchao Commerce Center Room 3209, Jintian Rd. 4028, Futian Dist. Shenzhen Registration number: 440301107794158 2) Limited partner: HeT Address: Shenzhen Academy of Aerospace Technology Building D, 10th floor 1010-1011, Keji South 10th Rd. No. 6, Hi-Tech South Area, Nanshan Dist., Shenzhen Registration number: 440301103031787 3) Limited partner: Shenzhen Koradior Fashion Co., Ltd. Address: Shenye Tairan Hongsong Building Section B Room 7H, Futian Dist. Shenzhen Social credit number: 91440300786573846G 4) Limited partner: Hangzhou Xinshen Stock Investment Partnership Firm LP Address: Xiangyuan Rd. 38, Building 1, East Block, 4th Floor, Room B409, Gongshu Dist. Hangzhou Registration number: 330105000369455 iii. Partnership business scope: investment management, fiduciary wealth management (not including trust, financial product management, stock management, or insurance product management), investment consulting, industrial investment (industry details not listed here), and enterprise management consulting (no project limits) 3. Partnership Agreement Overview i. Partnership company name: Shenzhen Qianhai Ruilin Investment Management Firm LP ii. Funding size: the partnership company will pledge 110,000,000 Yuan as the registered capital iii. Funding method: private funds iv. Organization structure: Partnership company LP Eastern Ruizhe, an acting partner, will be the manager of Qianhai Ruilin. The manager is the representative of the partnership company and responsible for making decisions for investments, property and investment management, and terminations. v. Investment target: all partners agree that the sole investment target of this partnership company is Qingdao Cotte. vi. Timeframe and purpose: the partnership will dissolve in six years. The purpose is to create the most value for each partner and the community. vii. Early exit plan: during the partnership, partners can exit if one of the situations in Partnership Company Law Section 45 occurs. General partners and limited partners must exit if, respectively, the situation(s) fits in Partnership Company Law Section 48 Situation 1, and Section 48 Item 1, 3 to 5. viii. Investors’ roles and responsibilities Eastern Ruizhe is the executive partner of this partnership company. The executive partner manages the operations and represents the partnership company. Penalties for failure to perform of the executive partner: if the executive partner fails to act according the contract agreement or consensus of all other partners, the executive partner shall make compensations equivalent to the loss. Limited partners do not have executive powers, nor do they represent the company, according to Partnership Company Law Section 68. ix. Liabilities Liabilities of the partnership company shall be divided according to the percentage of each partner’s investment, unless other agreements state otherwise. Liabilities occurred during the partnership company shall be cleared by the limited partners. Should there be debt not cleared on time, the general partner will bear the unlimited responsibility. 4. HeT’s Goal for the Investment The target company, Qingdao Cotte, is important to HeT’s comprehensive big data platform strategy. Qingdao Cotte has the following advantages. i. Ability to turn user demands into digital models. Streamline the production process regardless the source of order; ii. Innovative data-driven factory solutions. Unify production and management process online; iii. Digital value chain platform. Connect clients, suppliers, factories, logistics, customer service, etc. to optimize communications between all parties. HeT is actively developing big data platforms for personal and home applications, such as a smart cosmetic set and other smart appliances HeT is promoting. HeT is moving fast in development and will eventually become a leading power in the industry. In the age of big data, the difference between personal and industrial platforms will be obscured. The 4th Industrial Revolution, which is centered on customization, will only be made possible with the support of big data infrastructure. There is much to learn in the clothes customization process with big data operations. Qingdao Cotte is a mature and stable company in the industry. It will be a worthy investment with a decent return. 5. Risks i. Qingdao Cotte, despite being a successful company with a clear growing path, still faces uncertainties in company development speed and competitions from other rivals. ii. The long cycle of investment and property of low liquidity may make this investment less flexible in the ever-changing economy and industry environment. iii. Preventative methods: the company will promote effective communications with managers. Actively manage the operations and resources of the company. Encourage collaborations among partners to focus on practicality. Know the risks and invest carefully. 6. Appendix references i. Shenzhen Qianhai Ruilin Investment Management Firm LP Partnership Agreement ii. Investor Bodies Amendments End of announcement HeT Board of Directors |
Shenzhen H&T Intelligent Control Co., Ltd. ( ICP 06028608 )
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