News

Jiangsu Baoli Asphalt Co., Ltd.

Announcement on signature of Memorandum of Understanding between Baoli Holdings (Singapore) Pte Ltd and Far East Development Department of Russian  Federation

 

The company and the full members of the board of directors warrant the truthfulness, accuracy, completeness of the information disclosed herein, and that there is no misrepresentation, misleading statements or material omission contained in this announcement.

 

Special risk prompt statement:

1. The "Memorandum of Understanding" is only an intention document, the formal implementation requires further negotiation, therefore, there is a certain degree of uncertainty.

2. The "Memorandum of Cooperation" does not have the mandatory legal effect, or an arbitration effect. The memorandum can be terminated as long as the other party receives a written request to terminate the memorandum.

Ⅰ. Overview of Memorandum of Understanding

The Far East Development Department of the Russian Federation (hereinafter referred to as the "Far East Development Department") will establish a special economic zone in the  Far East Region of Russia in order to promote national strategic decision. The Far East Development Department will provide the most preferential policies and services, including tax reduction, simplified approval process and infrastructure support and related economic and social preferential terms, etc.

A wholly owned subsidiary of Jiangsu Baoli Asphalt Co., Ltd. (hereinafter referred to as the "Company"),  Baoli  Holdings (Singapore) Pte Ltd (hereinafter referred to as "Baoli") plans to participate in construction of the Far East Special Economic Zone, including the establishment of asphalt and waterproofing coiled material plant; in addition, the planned investment scale is up to 2 billion dollar. It also includes participation in the  project construction of the special economic zone in the Far East, the central region of Russia and the northeast region of Russia, including the PPP project, BT projects and BOT projects. On February 12, 2015, the two parties  signed a "Memorandum of Understanding" on cooperation intent based on the principle of win-win cooperation and mutual benefit.

The  investment plan matters involved in the "Memorandum of Understanding"  do not constitute related party transactions, nor do they constitute major asset restructuring.

II. The main contents of the memorandum

1. The Far East Development Department shall assist Baoli in setting up a branch company in Khabarovsk Special Economic Zone of Russia (Hereinafter referred to as "SEZ") .

2. Far East Development Department shall provide Baoli with 40-60 hectares of land in the SEZ under the most favorable conditions.

3.The Far East Development Department shall  provide 5-10 hectares of land  for port construction in the SEZ under the most favorable conditions.

4. Baoli shall establish a modified asphalt plant in the SEZ to produce and concoct high quality asphalt, including waterproofing coiled material and modified asphalt.

5. The Far East Development Department shall provide the best transport conditions for Baoli to export products to the Chinese market.

6. The Far East Development Department shall coordinate clearance procedure for product export so that Baoli can legally export products to Chinese market.

7. The Far East Development Department shall support Baoli to participate in tendering & bidding for infrastructure construction projects in the SEZ, including BT projects and BOT projects, etc.

Ⅲ. Others

1. The Far East Development Department shall accompany Baoli to carry out site visit of SEZ in March 2015, Baoli shall select and determine Baoli regions and related projects for future development.

2. The Far East Development Department shall assist Baoli in establishing transportation, raw material procurement as well as other necessary conditions to ensure the smooth progress of investment projects of Baoli.

3. The Far East Development Department shall provide a contract on investment project and Baoli shall carry out analysis and evaluation.

4. The Far East Development Department shall invite Baoli to participate in bidding projects of construction projects in SEZ.

IV. Special risk prompt statement

As for parties of the "Memorandum of Understanding", if one party needs to terminate the Memorandum of Understanding, the terminating party needs to make a written application, and provide to the other party by mail, fax or submission to terminate the memorandum. The "Memorandum of Understanding" does not have the mandatory legal effect, or an arbitration effect. The memorandum can be terminated as long as the other party receives a written request to terminate the memorandum. The Company will timely perform disclosure obligation regarding progress in implementation of the memorandum, we hope that the investors can pay attention to investment risks.

Ⅴ. Documents Available for Inspection

"Memorandum of Understanding"

   Notice is hereby published

             Board of Directors of Jiangsu Baoli Asphalt Co., Ltd.

February 14, 2015