東 風 汽 車 集 團 股 份 有 限 公 司 Dongfeng Motor Group

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東 風 汽 車 集 團 股 份 有 限 公 司 Dongfeng Motor Group Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. * DONGFENG MOTOR GROUP COMPANY LIMITED 東風汽車集團股份有限公司 (a joint stock company incorporated in the People’s Republic of China with limited liability) (Stock Code: 489) ANNOUNCEMENT CONTINUING CONNECTED TRANSACTION INTRODUCTION Dongfeng Motor Group Company Limited (the “Company”) is pleased to announce that on 1 February 2021, the Company entered into the connected transactions framework agreement (the “Framework Agreement”) with Dongfeng Nissan Financial Leasing Co., Ltd., pursuant to which, both parties agree that (1) the Company and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co., Ltd.; and (2) the Company and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd. LISTING RULES IMPLICATIONS As of the date of this announcement, Nissan (China) Investment Co., Ltd. holds 50% equity of Dongfeng Motor Co., Ltd., which is a jointly controlled entity of the Company and is also regarded as a subsidiary of the Company. Dongfeng Nissan Financial Leasing Co., Ltd. is a subsidiary of Nissan (China) Investment Co., Ltd., and is the associate of the substantial shareholders of the subsidiary of the Company, and therefore constitutes a connected person at the subsidiary level of the Company as stipulated under the Listing Rules. Given that the highest applicable percentage ratio for the two continuing connected transactions contemplated under the Framework Agreement entered into by the Company and Dongfeng Motor Co., Ltd exceeds 1% but is less than 5%, hence the agreement is subject to the reporting and announcement requirements but is exempt from the circular (including independent financial advice) and shareholders’ approval requirements of Chapter 14A of the Listing Rules. – 1 – INTRODUCTION The Company is pleased to announce that on 1 February 2021, the Company entered into the Framework Agreement with Dongfeng Nissan Financial Leasing Co., Ltd., pursuant to which, both parties agree that (1) the Company and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co., Ltd.; and (2) the Company and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd. The principal terms of the Framework Agreement are set out below: Date: 1 February 2021 Parties: (1) the Company; and (2) Dongfeng Nissan Financial Leasing Co., Ltd. Term: From 1 January 2021 to 31 December 2023 (inclusive both days) (1) The Company and Its Subsidiaries Sell Whole Vehicles to Dongfeng Nissan Financial Leasing Co., Ltd. According to the Framework Agreement, during the validity period of the Framework Agreement, the Company and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co., Ltd., and the quantity shall be determined according to both parties’ production plan or/and specific supply agreement signed by both parties. Regarding the quality and technical standards of the whole vehicles, the national standard shall be implemented if there is any; the industrial standard shall be implemented if there is no national standard; the enterprise standard shall be implemented if there is no national or industrial standard; if there is no above standard, or although there are above standards, special requirements are requested by Dongfeng Nissan Financial Leasing Co., Ltd., the technical condition and samples or supplemental technical requirements separately agreed by both parties in the specific supply agreement shall prevail. When implementing such quality standards, both parties may also agree on special quality requirements at the same time. – 2 – The prices of the whole vehicles are determined based on the market price and on an arm’s length and reasonable basis. Dongfeng Nissan Financial Leasing Co., Ltd. shall pay the price to the Company and its subsidiaries in the way agreed by both parties at the appointed time. The payment period (such as monthly payment or quarterly payment, etc.) shall be agreed on in the specific supply agreement in accordance with the principle of fairness and reasonableness and the ordinary commercial practice. For the Company, the terms of the specific supply agreement shall not be inferior to those received from an independent third party. The transactions contemplated under the Framework Agreement and relevant specific sales agreements will be conducted at any time in compliance with and in accordance with the Listing Rules and the applicable guidelines, rules and regulations of the Stock Exchange. HISTORICAL AMOUNTS There is no historical amount for the transactions contemplated under the Framework Agreement that the Company and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co., Ltd. ANNUAL CAPS AND BASIS OF DETERMINATION The proposed annual caps for the transactions contemplated under the Framework Agreement that the Company and its subsidiaries sell whole vehicles to Dongfeng Nissan Financial Leasing Co., Ltd. for periods indicated are as follows: For the year For the year For the year ending ending ending 31 December 31 December 31 December 2021 2022 2023 (RMB in millions) Amount paid for purchasing whole vehicles by Dongfeng Nissan Financial Leasing Co., Ltd. to the Company and its subsidiaries 1,900 2,600 3,200 The proposed annual caps are determined primarily based on quantity of orders, quarter-on-quarter sales forecast based on our business expansion plan and expected market condition. – 3 – Each annual cap is referred to the prevailing prices of comparable products in the market provided by independent third parties and the estimated quantity and price of whole vehicles purchased by Dongfeng Nissan Financial Leasing Co., Ltd. for each of the financial years ended 31 December 2021, 2022 and 2023. REASONS FOR AND BENEFITS FROM THE TRANSACTIONS The historical long-term cooperation between the Group and Dongfeng Nissan Financial Leasing Co., Ltd. in relation to other businesses has enabled Dongfeng Nissan Financial Leasing Co., Ltd. to have a comprehensive and in-depth understanding of the Group’s automobile manufacturing business and the sales and service needs to maintain its business. Hence, as compared with other third parties, Dongfeng Nissan Auto Finance Leasing Co., Ltd. guarantees to provide the Group with uninterrupted sales services at a competitive price, and the Group shall be guaranteed to continuously obtain high-quality sales services at a competitive price. (2) The Company and Its Subsidiaries Provide Entrusted Loans to Dongfeng Nissan Financial Leasing Co., Ltd. According to the Framework Agreement, during the validity period of the Framework Agreement, the Company and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd., and the quantity shall be determined according to both parties’ production plan or/and specific supply agreement signed by both parties. Entrusted loans shall be priced based on market rates (government-prescribed rate or government-guidance rate shall prevail if there is any), an arm’s length and reasonable basis and in compliance with the applicable policies and requirements stipulated by the relevant financial regulatory authorities from time to time and other applicable laws, rules and policies of the PRC. For the Company, the terms of each specific entrusted loan agreement shall not be inferior to those received from an independent third party. The transactions contemplated under the Framework Agreement and relevant specific sales agreements will be conducted at any time in compliance with and in accordance with the Listing Rules and the applicable guidelines, rules and regulations of the Stock Exchange. – 4 – HISTORICAL AMOUNTS There is no historical amount for the transactions contemplated under the Framework Agreement that the Company and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd. ANNUAL CAPS AND BASIS OF DETERMINATION The proposed annual caps for the transactions contemplated under the Framework Agreement that the Company and its subsidiaries provide entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd. for periods indicated are as follows: For the year For the year For the year ending ending ending 31 December 31 December 31 December 2021 2022 2023 (RMB in millions) Total entrusted loans provided by the Company and its subsidiaries to Dongfeng Nissan Financial Leasing Co., Ltd. 2,800 2,800 2,800 The annual cap is determined based on the experience of the Group, business development needs of Dongfeng Nissan Financial Leasing Co., Ltd., fund management policies of the Group, and the estimation of the Group’s ability to provide financial leasing services. REASONS FOR AND BENEFITS FROM THE TRANSACTIONS Since Dongfeng Nissan Financial Leasing Co., Ltd. mainly provides financial leasing services for end users and car dealers who purchase NISSAN, INFINITI and other brands, the Company believes that the provision of entrusted loans to Dongfeng Nissan Financial Leasing Co., Ltd. will improve the utilization efficiency of the Group’s funds, and bring convenience to the sales of Dongfeng Motor Co., Ltd. OPINION OF THE BOARD Taking into account the factors mentioned above, the Directors (including
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