Huatai United Securities Co., Ltd. Regarding the Audit Report on China General Nuclear Power Co., Ltd. and China General Nuclear Power Group Co., Ltd. Signing the "2027-2029 Nuclear Fuel Supply and Service Framework Agreement" and Adjusting the 2026 Annual Limit and Related Party Transactions
Huatai United Securities Co., Ltd. ("Huatai United Securities" or "Sponsor"), as the sponsor of China General Nuclear Power Co., Ltd. ("CGN Power", "the Company", or "the Company") for the issuance of convertible bonds to non-specific targets, according to the "Administrative Measures for Securities Issuance and Listing Sponsorship Business," the "Shenzhen Stock Exchange Stock Listing Rules," the "Shenzhen Stock Exchange Listed Company Self-Regulatory Supervision Guide No. 1 - Standardized Operation of Main Board Listed Companies," and other relevant laws, regulations, and normative documents, has conducted an audit on the "2027-2029 Nuclear Fuel Supply and Service Framework Agreement" signed by CGN Power and China General Nuclear Power Group Co., Ltd. and the adjustment of the 2026 annual limit and related party transactions. The audit findings and opinions are as follows:
I. Overview of Related Party Transactions
- On March 25, 2026, the Company and China General Nuclear Power Group Co., Ltd. ("CGN Group") signed the "2027-2029 Nuclear Fuel Supply and Service Framework Agreement" in Shenzhen, Guangdong Province. The agreement is valid from January 1, 2027, to December 31, 2029. CGN Group and its subsidiaries (hereinafter referred to as "CGN Group," unless otherwise specified, excluding the Company and its subsidiaries) will provide nuclear fuel supply and services to the Company and its subsidiaries, mainly including but not limited to natural uranium supply and services (agency procurement and direct supply), overall nuclear fuel contract services, spent fuel storage and transportation services, and other nuclear fuel supply and services.
The Company and CGN signed the "2024-2026 Nuclear Fuel Supply and Service Framework Agreement" on March 15, 2023. The scope of services and the annual transaction limit for 2024, 2025, and 2026 (hereinafter referred to as "Annual Limit") have been approved by the Company's 2022 Annual General Meeting of Shareholders. Assuming the scope of services and pricing principles remain unchanged, mainly due to the expected arrival of the first batch of fuel for Lufeng Unit 5 in 2026 and the increase in market prices for natural uranium and component processing, the 2026 Annual Limit approved in 2023 needs to be increased and re-approved.
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CGN Group is the controlling shareholder of the Company. According to the "Shenzhen Stock Exchange Stock Listing Rules," CGN Group is a related party to the Company, and the signing of the "2027-2029 Nuclear Fuel Supply and Service Framework Agreement" (hereinafter referred to as "this transaction") constitutes a related party transaction.
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On March 25, 2026, the Company held the 19th meeting of its Fourth Board of Directors and deliberated and passed the "Proposal on Renewing the Nuclear Fuel Supply and Service Framework Agreement between China General Nuclear Power Co., Ltd. and Related Annual Transaction Amount Limits." Related directors Mr. Yang Changli, Mr. Pang Songtao, and Ms. Li Li recused themselves from voting as required. The proposal was unanimously approved by the remaining 5 non-related directors. On March 18, 2026, the Company's Independent Directors' Special Meeting deliberated on the above proposal and unanimously approved it. This transaction is still subject to the approval of the Company's 2025 Annual General Meeting of Shareholders, and related parties with conflicts of interest in this related party transaction will recuse themselves from voting.
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This related party transaction does not constitute a major asset restructuring as defined in the "Measures for Major Asset Restructuring of Listed Companies."
II. Basic Information of Related Parties