Securities code: 600237 Securities abbreviation: Tongfeng Electronic Announcement number: Lin 2022-001

Anhui Tongfeng Electronic Co., Ltd. on the holding subsidiary -- Tongling Fenghua Electronic Co., Ltd. to provide guarantee progress announcement

The board of directors and all the directors of the Company warrant that there is no false record, misleading statement or material omission in the content of this announcement, and bear individual and joint liability for the authenticity, accuracy and completeness of the content.

Important content Tips:
● Name of Guarantor: Holding subsidiary ----- Tongling Fenghua Electronic Co., LTD
● Guarantee quantity: The maximum limit of guarantee for Tongling Fenghua Electronic Co., Ltd. is 10 million yuan. Up to now, the company does not provide guarantees for Tongling Fenghua Electronic Co., LTD.
● This guarantee whether there is a counter-guarantee: Yes
Total guarantee: 5.5 million Yuan (excluding this guarantee)
● External guarantee overdue cumulative number: none
I. Overview of the guarantee situation
On February 5, 2021, the third meeting of the ninth Board of Directors of Anhui Tongfeng Electronics Co., LTD. (hereinafter referred to as the "Company") deliberated and passed the Proposal on the expected guarantee amount for wholly-owned and controlling subsidiaries in 2021, agreeing that the Company would provide comprehensive credit guarantee for wholly-owned and controlling subsidiaries with a total amount not exceeding 80 million yuan. The company agrees to provide a guarantee limit of not more than 20 million yuan for its controlling subsidiary, Tongling Fenghua Electronics Co., LTD. (hereinafter referred to as "Fenghua Company"). The authorization guarantee shall be valid for one year from the date of approval by the Board of Directors (as detailed in the Company's announcement on the website of Shanghai Stock Exchange and the Company's designated media on February 6, 2021).
Recently, the company and China Construction Bank Co., LTD. Tongling Development Zone branch signed a "guarantee contract", the company will provide Fenghua company to apply for the loan of the maximum limit of 10 million yuan, the guarantee period is three years, the guarantee way is joint liability guarantee.
Ii. Basic Information of the Guaranteed
Tongling Fenghua Electronics Co., Ltd. was established on December 16, 2002. The company is a limited liability company. The company's residence is Tongfeng Industrial Park, Tongling Economic and Technological Development Zone, Anhui Province. The registered capital of Fenghua Company is 50 million yuan, in which the company accounts for 98.76% of the total shares of the company. The company is mainly engaged in the development, production and sales of quartz crystal frequency devices, the development, production and sales of electronic devices, self-support and agent import and export business of all kinds of commodities and technologies (except the commodities and technologies whose import and export are restricted or prohibited by the state).
According to the audit report issued by Rongcheng Certified Public Accountants (Special General Partnership), as of December 31, 2020, the total assets of Fenghua Company were 9,683,100 yuan, total liabilities were 63,981,300 yuan and owners' equity was 3,849,800 yuan. In 2020, the company achieved a revenue of 35.6221 million yuan and a net profit of 939,100 yuan.
As of September 30, 2021, the total assets of Fenghua Company are 9,515,800 yuan, total liabilities are 6,226,600 yuan, and owners' equity is 30.289,800 yuan. From January to September 2021, the company achieved operating income of 42.4060 million yuan and net profit of -2.5660 million yuan (data unaudited).
Iii. Main contents of the guarantee Agreement
The Company will provide a guarantee of up to RMB 10 million for the loans applied by its controlling subsidiary Fenghua Company in Tongling Development Zone Branch of China Construction Bank Co., LTD., in the form of joint and several liability guarantee for a period of three years. The specific business elements of this guarantee shall be subject to the relevant contract text signed with the bank.
Iv. Opinions of the Board of Directors
The board of directors believes that the loan funds of Fenghua Company this time will be used for the production and operation of the company and supplementary working capital. The use of funds is reasonable. Fenghua Company has good solvency and low guarantee risk.
The company's equity ratio in Fenghua Company is 98.76% and it has absolute control over Fenghua Company. The other shareholder of Fenghua Company has a smaller shareholding ratio and does not have the conditions to provide guarantee, so it cannot provide guarantee in proportion to its equity ratio. In order to effectively control the external guarantee risk, Fenghua Company issued a counter-guarantee commitment letter for the company, promising that if the company suffers losses due to the performance of the above guarantee obligations, it is willing to bear the counter-guarantee liability and provide full compensation for the company. This guarantee for Fenghua Company is in line with the company's business development strategy, and relevant risks can be controlled.
5. The accumulative amount of external guarantees and the overdue amount of guarantees
Up to now, the cumulative total amount of the company's external guarantees is 5.5 million yuan (excluding this guarantee), accounting for 0.50% of the company's audited net assets attributable to the parent company in 2020. All the above guarantees are for the wholly-owned company. The company has no overdue external guarantee.
Vi. File directory for reference
1. Copy of Business license of Fenghua Company;
2. Annual financial statements of Fenghua Company.
This is to announce.