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China Ruifeng Renewable Energy : VERY SUBSTANTIAL DISPOSAL IN RELATION TO SALE AND LEASEBACK TRANSACTIONS AND NOTICE OF EXTRAORDINARY GENERAL MEETING

December 23, 2019 at 07:01 pm IST

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer or registered institution in securities, a bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in China Ruifeng Renewable Energy Holdings Limited, you should at once hand this circular together with the accompanying proxy form to the purchaser or transferee or to the bank, licensed securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

CHINA RUIFENG RENEWABLE ENERGY HOLDINGS LIMITED

中國瑞風新能源控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 527)

VERY SUBSTANTIAL DISPOSAL IN RELATION TO

SALE AND LEASEBACK TRANSACTIONS

AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

Financial adviser to China Ruifeng Renewable Energy Holdings Limited

A letter from the Board is set out on pages 4 to 14 of this circular.

A notice convening the EGM to be held at Room 1801, 18/F, Great Eagle Centre, No. 23 Harbour Road, Wanchai, Hong Kong at 11:00 a.m. on 13 January 2020 or any adjournment of such meeting is set out on pages EGM-1 to EGM-2 of this circular at which an ordinary resolution will be proposed to approve the Sale and Leaseback Agreements and the transactions contemplated. Whether or not you intend to attend the EGM, you are requested to complete and return the accompanying proxy form in accordance with the instructions printed on it and return it to the Company's share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong, as soon as possible and in any event not later than 48 hours before the time appointed for holding the EGM or any adjournment of such meeting (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournment of such meeting should you so wish and, in such event, the proxy form previously submitted shall be deemed to be revoked.

Hong Kong, 24 December 2019

CONTENTS

		Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . .	4
APPENDIX I	- FINANCIAL INFORMATION OF THE GROUP . . .	I-1
APPENDIX II - UNAUDITED STATEMENTS OF PROFIT OR LOSS
	ON THE LEASED ASSETS . . . . . . . . . . .	II-1
APPENDIX III - UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP . . . . . . . .	III-1
APPENDIX IV - VALUATION REPORT . . . . . . . . . . . . . .	IV-1
APPENDIX V	- GENERAL INFORMATION . . . . . . . . . . . .	V-1
NOTICE OF THE EGM . . . . . . . . . . . . . . . . . . . . .	EGM-1

- i -

DEFINITIONS

In this circular, the following expressions shall have the meanings set out below unless the context otherwise requires:

"Company"	China Ruifeng Renewable Energy Holdings Limited, a company
	incorporated in the Cayman Islands with limited liability and
	the issued shares of which are listed on the Stock Exchange
"Director(s)"	the director(s) of the Company
"EGM"	the extraordinary general meeting of the Company to be
	convened to seek the Shareholders' approval on the Sale and
	Leaseback Agreements and the transactions contemplated
	thereunder
"Group"	the Company and its subsidiaries
"HKFRS"	Hong Kong Financial Reporting Standard
"Hong Kong"	the Hong Kong Special Administrative Region of the People's
	Republic of China
"Hongsong Project"	the operation of a wind farm in Chengde City, Hebei Province,
	the PRC
"Independent Third	any persons or company(ies) and their respective ultimate
Party(ies)"	beneficial owners, to the best of the Directors' knowledge,
	information and belief having made all reasonable enquiries,
	who are not connected persons of the Company and are third
	parties independent of the Company and its connected persons
	in accordance with the Listing Rules
"Latest Practicable Date"	16 December 2019, the latest practicable date before the
	printing of this circular for ascertaining certain information
	contained herein
"Leased Assets"	collectively, the Leased Assets I, Leased Assets II, Leased
	Assets III, Leased Assets IV, and Leased Assets V
"Leased Assets I"	wind power generators and the ancillaries in phase 2 and phase
	3 of the Hongsong Project

- 1 -

		DEFINITIONS

"Leased Assets II"	wind power generators and the ancillaries in phase 4 and phase
	5	of the Hongsong Project
"Leased Assets III"	wind power generators and the ancillaries in phase 6 and phase
	7	of the Hongsong Project
"Leased Assets IV"	wind power generators and the ancillaries in phase 8 and phase
	9	of the Hongsong Project
"Leased Assets V"	buildings and land use rights in phase 8 and phase 9 of the
	Hongsong Project

"Lessee" or "Hongsong" Hebei Hongsong Wind Power Co., Ltd.*（河北紅松風力發電股份有限公司）, a sino-foreign equity joint venture company and

	indirectly owned as to 86.55% by the Company
"Lessor"	Huaneng Tiancheng Financial Leasing Co., Ltd.* ( 華能天成融
	資租賃有限公司)
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock
	Exchange
"PRC"	The People's Republic of China which for the purpose of this
	circular excludes Hong Kong, the Macau Special Administrative
	Region and Taiwan
"Sale and Leaseback"	the sale and leaseback transactions as stipulated in the Sale and
	Leaseback Agreements
"Sale and Leaseback	collectively, the Sale and Leaseback Agreement I, Sale and
Agreements"	Leaseback Agreement II, Sale and Leaseback Agreement III,
	Sale and Leaseback Agreement IV and Sale and Leaseback
	Agreement V
"Sale and Leaseback	the agreement dated 29 November 2019 entered into between
Agreement I"	the Lessor and the Lessee in relation to the sale and leaseback
	arrangement of the Leased Assets I
"Sale and Leaseback	the agreement dated 29 November 2019 entered into between
Agreement II"	the Lessor and the Lessee in relation to the sale and leaseback
	arrangement of the Leased Assets II
	- 2 -

	DEFINITIONS

"Sale and Leaseback	the agreement dated 29 November 2019 entered into between
Agreement III"	the Lessor and the Lessee in relation to the sale and leaseback
	arrangement of the Leased Assets III
"Sale and Leaseback	the agreement dated 29 November 2019 entered into between
Agreement IV"	the Lessor and the Lessee in relation to the sale and leaseback
	arrangement of the Leased Assets IV
"Sale and Leaseback	the agreement dated 29 November 2019 entered into between
Agreement V"	the Lessor and the Lessee in relation to the sale and leaseback
	arrangement of the Leased Assets V
"SFO"	the Securities and Futures Ordinance (Chapter 571 of the Laws
	of Hong Kong)
"Share"	ordinary share(s) of the Company
"Shareholder(s)"	holder(s) of the issued Share(s)
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"RMB"	Renminbi, the lawful currency of the PRC
"USD"	United States dollars, the lawful currency of the United States
"%"	per cent.

For the purpose of this circular, "*" denotes an English translation of a Chinese name and is for identification purposes only. In the event of any inconsistency the Chinese names shall prevail.

- 3 -

LETTER FROM THE BOARD

CHINA RUIFENG RENEWABLE ENERGY HOLDINGS LIMITED

中國瑞風新能源控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 527)

Executive Directors:	Registered Office:
Mr. Zhang Zhixiang (Chief Executive Officer)	Tricor Investor Services Limited
Mr. Ning Zhongzhi	Level 54
Mr. Li Tian Hai	Hopewell Centre
Mr. Peng Ziwei	183 Queen's Road East
	Hong Kong
Independent non-executive Directors:
Mr. Qu Weidong	Principal place of Business in
Ms. Hu Xiaolin	Hong Kong:
Mr. Jiang Senlin	Room 1801, 18/F
	Great Eagle Centre
	No. 23 Harbour Road
	Wanchai, Hong Kong
	24 December 2019
To the Shareholders
Dear Sir/Madam

VERY SUBSTANTIAL DISPOSAL

IN RELATION TO

SALE AND LEASEBACK TRANSACTIONS

AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the announcement of the Company dated 29 November 2019 in relation to the Sale and Leaseback Agreements.

- 4 -

LETTER FROM THE BOARD

The purpose of this circular is to provide you with information regarding, among other things, the details of the Sale and Leaseback Agreements and the transactions contemplated thereunder.

THE SALE AND LEASEBACK

The Board is pleased to announce that on 29 November 2019 (after trading hours), the Lessor and the Lessee, an indirect non wholly-owned subsidiary of the Company, entered into the Sale and Leaseback Agreements, pursuant to which, among other things, the Lessor agreed to purchase certain wind power generators, ancillaries, buildings and land use rights of the Hongsong Project from the Lessee, at an aggregate consideration of RMB1,800,000,000, which shall be leased back to the Lessee with lease periods range from 5 to 13 years as stipulated in each of the Sale and Leaseback Agreements. Upon expiry of the lease term of each of the Sale and Leaseback Agreements, the Lessee can purchase the Leased Assets at a consideration of RMB20,000. The total purchase consideration for the Leased Assets shall be RMB100,000 in aggregate.

The principal terms of the Sale and Leaseback Agreements are summarised as follow:

Sale and	Sale and	Sale and	Sale and	Sale and
Leaseback	Leaseback	Leaseback	Leaseback	Leaseback	Total
Agreement I	Agreement II	Agreement III	Agreement IV	Agreement V	amount

Date of agreement			29 November 2019
The Leased Assets	Wind power	generators and ancillaries of the Hongsong Project	Buildings and
	in the following phases:			land use rights
	2 and 3	4 and 5	6 and 7	8 and 9	in phase 8 and
					phase 9 of
					the Hongsong
					Project
Cash consideration to be	340.00	360.00	400.00	420.00	280.00	1,800.00
received by the Lessee
(in RMB' million)
Lease period	5 years	8 years	11 years	13 years	13 years
Number of lease	20	32	44	52	52
payments	The lease payments consist of the principal, interests and handling fees.
Interest rate	Based on the	following premium over the benchmark interest rate	of RMB	loans
	with maturity above five years of 4.9% for the Sale and Leaseback Agreements:
	20% premium	21% premium	22% premium	23% premium	23% premium
	i.e. 5.88%	i.e. 5.929%	i.e. 5.978%	i.e. 6.027%	i.e. 6.027%

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LETTER FROM THE BOARD

Sale and	Sale and	Sale and	Sale and	Sale and
Leaseback	Leaseback	Leaseback	Leaseback	Leaseback	Total
Agreement I	Agreement II	Agreement III	Agreement IV	Agreement V	amount

The benchmark interest rate of RMB loan is promulgated by the People's Bank of China from time to time. If the benchmark interest rate of RMB loan as set out above is adjusted upward, the subsequent interest payables shall be adjusted accordingly.

Handling fee	10.64	16.73	25.10	30.89	20.59	103.95
(in approximate	Of the total balance of approximately RMB103.95 million, RMB18 million is payable to the Lessor
RMB' million)	before commencement of the lease terms of the Sale and Leaseback Agreements and the remaining
	fees are payable in instalments in accordance with the schedule as stipulated in the Sale and
	Leaseback Agreements.
Guarantee deposit	10.20	10.80	12.00	12.60	8.40	54.00
(in RMB' million)	Guarantee deposits are payable to the Lessor before commencement of the lease terms of the Sale
	and Leaseback Agreements. Guarantee deposits shall be maintained at 3% of the outstanding
	principal lease amount at all time.
Cash consideration to	0.02	0.02	0.02	0.02	0.02	0.10
purchase the Leased	Upon expiry or termination of each of the Sale and Leaseback Agreements, provided that all
Assets (in RMB'	obligations have been performed as set out in each of the Sale and Leaseback Agreements, it is at
million)	the discretion of the Lessee to purchase the Leased Assets in the respective Sale and Leaseback
	Agreements at the consideration of RMB0.02 million each.
Compensation to be	(i)	Within the first 24 months of the lease period, the following amount less any
paid to the Lessor for		interests and handling fees paid:
initiation of an early	64.00	62.00	64.00	67.00	48.00
buyback of the Leased
Assets (in RMB'	If the aggregate amount of interests and handling fee paid is not less than the amount
million)	stated above, no compensation is required.

Beyond the first 24-month of the lease period but before the expiry of the lease, the following amount plus interests accrued but not yet paid and minus handling fees paid:

	64.00	62.00	64.00	67.00	48.00
Conditions precedent of	Payment of the total consideration of the Leased Assets to the Lessee is conditional upon satisfaction
cash payment	of, among other things, the following:

obtaining of the approval of the Shareholders at the EGM for the Sale and Leaseback Agreements and the transactions contemplated thereunder including the corporate guarantee from the Company and share pledges of certain subsidiaries of the Company;
obtaining of the respective approvals of the shareholders of the Lessee and certain subsidiaries of the Company that are shareholders of the Lessee for the Sale and Leaseback Agreements and the transactions contemplated thereunder;
the account receivables charge agreement, guarantee agreements, share pledge agreements and designated account agreement have been effective;
- 6 -

LETTER FROM THE BOARD

receipt of all land use right certificates and building ownership certificates by the Lessor for land use rights and buildings in the Hongsong Project as set out in the Sale and Leaseback Agreements; and
receipt of evidence from certain financial institutions to prove the full settlement of the loans as set out in the Sale and Leaseback Agreements.

As all of the Sale and Leaseback Agreements are subject to same conditions precedent, the Sale and Leaseback Agreements are in substance inter-conditional.

The consideration shall be paid to the Lessee in five instalments depending on the timing of fulfillment of condition (v) above in respect of full settlement of specific loans as stipulated in each of the Sale and Leaseback Agreements. All the loans as stipulated in condition (v) shall be settled by the consideration except for that of the Sale and Leaseback Agreement I. Details of the loans as stipulated in condition (v) is set out in the table in the paragraph headed "Reasons for and benefits of the Sale and Leaseback" below. The loan as stipulated in condition (v) in Sale and Leaseback Agreement I shall be settled by the proceed from the placing of new Shares. Detail of the placing is set out in the announcements of the Company dated 4 December 2019 and 10 December 2019. Other than the aforesaid, the other conditions shall be satisfied before the cash payments made by the Lessor. The Lessor shall pay the first instalment to the Lessee by no later than 30 April 2020 after satisfaction of the conditions as stated above. Other than the aforesaid, timing of the payment of the other four installments are not specified in the Sale and Leaseback Agreements.

As at the Latest Practicable Date, none of the conditions had been fulfilled.

Security	The	obligations of the Lessee under the Sale and Leaseback Agreements shall be secured by the
	following:
	(i)	a charge on the account receivables and other receivables of the Hongsong Project;
	(ii)	a personal guarantee from Mr. Zhang Zhixiang (an executive Director and the single largest
		Shareholder with 27.52% shareholding interests in the Company) which is agreed by his
		spouse;
	(iii)	a corporate guarantee from the Company; and
	(iv)	shares pledges of the following to the Lessor:
		a.	four	share pledges in respect of the shareholding interests in the Lessee held
			directly by the following subsidiaries of the Company:
			-	47.25% interests in the Lessee directly held by On Win Corporation
				Limited;
			-	35.06% interests in the Lessee directly held by Hebei Hongsong Renewable
				Energy Investment Co., Ltd.*（河北紅松新能源投資有限公司）;
			-	3.05% interests in the Lessee directly held by Chengde Beichen High New
				Technology Co., Ltd.*（承德北辰高新科技有限公司）; and

- 7 -

LETTER FROM THE BOARD

		-	1.19% interests in the Lessee directly held by Chengde Hongsong Wind
			Power Technical Services Co., Ltd.*（承德紅松新能源技術服務有限公司）.
	b.	five share pledges of the following subsidiaries of the Company which directly hold
		the shareholding interests in the Lessee as listed in (a) above:
		-	100% interests in On Win Corporation Limited, which directly held 47.25%
			interests in the Lessee;
		-	a total of 79.06% interests in Hebei Hongsong Renewable Energy
			Investment Co., Ltd.*（河北紅松新能源投資有限公司）(with 76.98%
			interests held by Chengde Beichen High New Technology Co., Ltd. and
			2.08% interests held by Chengde Hongsong Wind Power Technical Services
			Co., Ltd.), which directly held 35.06% interests in the Lessee;
		-	100% interests in Chengde Beichen High New Technology Co., Ltd.*（承
			德北辰高新科技有限公司）, which directly held 3.05% interests in the
			Lessee; and
		-	100% interests in Chengde Hongsong Wind Power Technical Services Co.,
			Ltd.*（承德紅松新能源技術服務有限公司）, which directly held 1.19%
			interests in the Lessee.
	For the shares pledged to the Lessor, the Lessor is entitled to the dividends and any other payables
	to the pledgees until the pledgees' obligations as set out in the Sale and Leaseback Agreements and
	the share pledge agreements are fully satisfied.
Designated account	Cash received from the Hongsong Project shall be deposited in a designated account. The fund of the
	designated account will be used for lease payments and payment of additional guarantee deposits (if
	required) to the Lessor in accordance with the Sale and Leaseback Agreements, operating expenses
	of the Lessee	and	dividend distribution of the Lessee. The quarterly operating expenses shall be

subject to the caps of RMB15.0 million for the first nine years of the leases, RMB11.5 million from the tenth year to the eleventh year and RMB5.75 million from the twelfth year to the thirteenth year. The resultant net balance of the fund in excess of RMB20.0 million (on a quarterly basis) will be applied towards early payment of the principal to the Lessor.

The terms of the Sale and Leaseback Agreements were determined after arm's length negotiations between the Lessee and the Lessor. The terms including interest rates, handling fees and guarantee deposits were determined after taking into consideration of the prevailing market rates for similar finance leases in the PRC.

- 8 -

LETTER FROM THE BOARD

The Company has identified 15 finance lease transactions in relation to the operations of wind power and/or renewable energy announced by wind power and renewable energy companies listed on the Stock Exchange from 1 January 2019 up to the date of the announcement in respect of the Sale and Leaseback Agreements, being 29 November 2019 (the "Comparables"). The Directors are of the view that the Comparables reflect the latest market condition of finance lease transactions. To the best Directors' knowledge, effort and endeavour and based on the information disclosed on the Stock Exchange's website (https://www.hkex.com.hk/) and Bloomberg, the list of the Comparables is an exhaustive list for comparison purpose. The rate of handling fees to the total consideration under the Sale and Leaseback Agreements of approximately 5.8% is within the range of 1.0% to 12.0% of those of the Comparables whereas the rate of guarantee deposits to the total consideration under the Sale and Leaseback Agreements of 3.0% is within the range of 1.0% to 4.5% of those of the Comparables. The premium over the benchmark interest rate of RMB loan under the Sale and Leaseback Agreements ranging from 20.0% to 23.0%. Other than the highest premium of 23.0%, the other premiums are within the range of 0.356% to 22.0% of the Comparables. The highest premium of 23.0% is slightly higher than the maximum premium of 22.0% over the benchmark interest rate of RMB loan of the Comparables. Given that the total consideration of the Leased Assets represents a premium of approximately 9.5% over the appraised value of the Leased Assets as at 31 October 2019, the Company considers that the highest premium of 23.0% is acceptable.

As at 31 October 2019, the unaudited net asset value of the Leased Assets was approximately RMB1,151.7 million. The total consideration of the Leased Assets of RMB1,800.0 million represents a premium of approximately 9.5% over the appraised value of the Leased Assets of approximately RMB1,644.5 million as at 31 October 2019 as appraised by an independent valuer. The consideration of each of the Sale and Leaseback Agreements were determined with reference to the appraised value of the Leased Assets and internal assessment of the Company.

Based on the aforesaid, the Directors consider that the terms of the Sale and Leaseback Agreements are fair and reasonable.

ACCOUNTING TREATMENT FOR THE SALE AND LEASEBACK

During the lease periods of the Sale and Leaseback Agreements, the ownership of the Leased Assets will be vested in the Lessor. The Lessee shall have the right to possess and use the Leased Assets.

In accordance with the requirements of Hong Kong Financial Reporting Standards, the Sale and Leaseback shall be accounted for as a financing transaction and therefore would not give rise to any gain or loss, or reduction in value of the Leased Assets.

- 9 -

LETTER FROM THE BOARD

FINANCIAL EFFECT OF THE SALE AND LEASEBACK ON THE GROUP

The total consideration for the Leased Assets under the Sale and Leaseback Agreements is RMB1,800.0 million, which is approximately RMB648.3 million over the unaudited net asset value of the Leased Assets of approximately RMB1,151.7 million as at 31 October 2019. The Sale and Leaseback is not expected to result in any gain or loss to the Group in its consolidated financial statements pursuant to applicable accounting principles. Since the transactions contemplated under the Sale and Leaseback Agreements give rise to a finance leaseback, the substance of the Sale and Leaseback is that no disposal of the Leased Assets has taken place and, therefore, no gain or loss on disposal is expected to be recognised in the Group's consolidated financial statements pursuant to applicable accounting principles. To reflect the substance of the arrangement, the Group continues to recognise the Leased Assets at the net book value, which was approximately RMB1,151.7 million as at 31 October 2019 and to account for the Leased Assets as if the Sale and Leaseback had not occurred. The net proceeds received from the Lessor would be recorded as borrowings of approximately RMB1,782.0 million, which is a liability for the Group. The Group's cash and cash equivalents will be increased by RMB234.3 million.

REASONS FOR AND BENEFITS OF THE SALE AND LEASEBACK

The Sale and Leaseback is a financing transaction that allows the Group to secure long- term financings of up to 13 years whilst the Group will continue to utilise the Leased Assets. It is common for wind power projects in the PRC to conduct sale and leaseback transactions. The Lessee can purchase the Leased Assets at nominal considerations after the expiry of the lease terms.

The net consideration of the Sale and Leaseback (after deducting guarantee deposits, handling fees and insurance fees) is approximately RMB1,623.0 million. The insurance fees of approximately RMB19.0 million will be paid to an insurance company, which is an Independent Third Party, over the lease periods of the Sale and Leaseback Agreements. Of the balance, approximately RMB1,478.9 million will be used for repayment of indebtedness of the Group (including the Lessee) in accordance with their respective terms and approximately RMB79.0 million will be used for payment of the outstanding dividend payables of the Lessee (including approximately RMB78.1 million of dividend payable and estimated tax expense for distribution to non-PRC shareholders of Hongsong). The remaining balance of approximately RMB65.1 million is earmarked for working capital of the Group. Details of the repayment of indebtedness of the Group are set out below:

- 10 -

LETTER FROM THE BOARD

			Outstanding
			amount as
	Outstanding	at the Latest	Amount to be
	amount as at	Practicable	repaid by net
	30 June 2019	Date	consideration
	(RMB' million)	(RMB' million)	(RMB' million)
Bank loans	607.8		523.5	488.0 (Note 2)
Convertible Notes (Note 1)	140.5		152.6	152.6
Bonds	149.0		150.1	150.1
Convertible Bonds (Note 1)	284.2		301.5	301.5
Finance lease payment	83.9		78.4	78.4
Other borrowings	232.2		308.3	308.3
Total	1,497.6		1,514.4	1,478.9

Notes:

The term is defined in Appendix 1 to this circular.
Bank loan of approximately RMB35.5 million will be repaid by the proceeds from the placing of the new Shares. Details of the placing is set out in the announcements of the Company dated 4 December 2019 and 10 December 2019.

The allocation of approximately RMB65.1 million of working capital of the Group is set out below:

	RMB' million
Staff cost	40.4
Repairs and maintenance	14.8
Other office expenses	9.9

Total	65.1

The Sale and Leaseback refinances the indebtedness of the Group (including the Lessee) and also provides cash to the Group for its operations. Furthermore, the lease durations under the Sale and Leaseback Agreements range from 5 to 13 years, which are longer than the maturities of the existing debts of the Group of up to six years. The Directors consider that the Sale and Leaseback is a financing arrangement that better aligns the cash flows generated from the Leased Assets with the Lessee's financial obligations. It also offers a more efficient leverage of the Leased Assets as the total consideration represents a premium over the appraised value of the Leased Assets as at 31 October 2019 appraised by an independent valuer.

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LETTER FROM THE BOARD

Based on the aforesaid, the Directors consider that the Sale and Leaseback Agreements and the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole.

INFORMATION OF THE COMPANY AND THE LESSEE

The Company is a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange. The Group is principally engaged in the business of wind farm operation.

The Lessee is an indirect non wholly-ownedsubsidiary with 86.55% shareholding interests held by the Company. The remaining shareholding interests of 13.45% in the Lessee are held by Chengde Guotou Power Construction Investment Co., Ltd.*（承德市國投電建投資有限責任公司）of 8.06%, Hebei Weichang Hongsong Yumu Industry and Commerce Co., Ltd.*（河北圍場紅松窪牧工商有限責任公司）of 4.00%, Weichang Manchu Mongolian Autonomous County Yongda Investment Co., Ltd.*（圍場滿族蒙古族自治縣湧達投資有限公司）of 1.06%, and Chengde Shuangyu Shiqiang Industry and Trade Co., Ltd.*（承德雙灤實強工貿有限公司）of 0.33%.

The Lessee is principally engaged in wind farm operation in Chengde City, Hebei Province, the PRC. The wind farm has been developed in nine phases. The Hongsong Project has an installed capacity of 398.4 megawatt and its maximum installable capacity is 596.4 megawatt.

INFORMATION OF THE LESSOR

The Lessor, is a sino-foreign joint venture established under the laws of the PRC, and is principally engaged in financial leasing, leasing property purchase, leasing property processing, leasing transaction consultation, and other related services.

The Lessor and its ultimate beneficial owner, the State-owned Assets Supervision and Administration Commission of the State Council of the PRC, are Independent Third Parties.

LISTING RULES IMPLICATIONS

As the highest applicable percentage ratio under Chapter 14 of the Listing Rules in respect of the Sale and Leaseback exceeds 75%, the entering into of the Sale and Leaseback Agreements constitutes a very substantial disposal for the Company and is subject to the reporting, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules.

- 12 -

LETTER FROM THE BOARD

To the best of the Directors' knowledge, information and belief, as the Lessor is an Independent Third Party of the Company and no Shareholder has a material interest in the Sale and Leaseback transaction, none of the Shareholders and their respective close associates is required to abstain from voting in respect of the ordinary resolution to approve the Sale and Purchase Agreements and the transactions contemplated thereunder at the EGM.

The EGM

The EGM will be convened and held at Room 1801, 18/F, Great Eagle Centre, No. 23 Harbour Road, Wanchai, Hong Kong at 11:00 a.m. on 13 January 2020, for the purpose of considering, and, if thought fit, approve the relevant resolution in relation to the Sale and Leaseback Agreements and the transactions contemplated thereunder. The notice convening the EGM is set out on pages EGM-1 to EGM-2 of this circular. A form of proxy for use at the EGM is enclosed with this circular. Whether or not the Shareholders are able to attend the EGM, the Shareholders are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return it to the share registrar and transfer office of the Company, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong, as soon as practicable and in any event not later than 48 hours before the time appointed for holding the EGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude the Shareholders from attending or voting in person at the EGM or any adjourned meeting (as the case may be) should the Shareholders so wish.

RECOMMENDATION

Having considered the reasons set out herein, the Directors are of the opinion that the terms of the Sale and Leaseback Agreements are fair and reasonable and that the Sale and Leaseback are in the interests of the Company and the Shareholders as a whole. The Directors recommend the Shareholders to vote in favour of the relevant resolution as set out in the notice of the EGM to approve the Sale and Leaseback Agreements and the transactions contemplated thereunder.

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LETTER FROM THE BOARD

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully,

For and on behalf of the Board

China Ruifeng Renewable Energy Holdings Limited

Zhang Zhixiang

Executive Director and Chief Executive Officer

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

CONSOLIDATED FINANCIAL INFORMATION OF THE GROUP FOR EACH OF THE THREE FINANCIAL YEARS ENDED 31 december 2016, 2017 and 2018 AND THE SIX MONTHS ENDED 30 JUNE 2019
Consolidated financial information of the Group for each of the three financial years ended 31 December 2016, 2017 and 2018 and the six months ended 30 June 2019 are disclosed in the following documents which have been published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.c-ruifeng.com) respectively:
- annual report of the Company for the year ended 31 December 2016 published on 19 April 2017 (pages 66 to 173), which can be accessed via the link at
  https://www1.hkexnews.hk/listedco/listconews/sehk/2017/0419/ltn20170419958.pdf
- annual report of the Company for the year ended 31 December 2017 published on 20 April 2018 (pages 69 to 169), which can be accessed via the link at
  https://www1.hkexnews.hk/listedco/listconews/sehk/2018/0420/ltn20180420003.pdf
- annual report of the Company for the year ended 31 December 2018 published on 18 April 2019 (pages 81 to 175), which can be accessed via the link at
  https://www1.hkexnews.hk/listedco/listconews/sehk/2019/0418/ltn201904181492.pdf
- interim report of the Company for the six months ended 30 June 2019 published on 3 September 2019 (pages 23 to 54), which can be accessed via the link at
  https://www1.hkexnews.hk/listedco/listconews/sehk/2019/0903/ltn20190903583.pdf
STATEMENT OF INDEBTEDNESS
At the close of business on 31 October 2019, being the latest practicable date for the purpose of this indebtedness statement prior to the printing of this circular, the Group had aggregate outstanding borrowings of approximately RMB1,480.1 million which comprised, i) approximately RMB498.0 million under bank loans; ii) approximately RMB153.0 million under other loans; iii) approximately RMB148.8 million under unsecured bonds; iv) approximately RMB233.0 million under obligations under finance leases, v) approximately RMB149.2 million under the unsecured Convertible Notes, and vi) approximately RMB298.1 million under the Convertible Bonds.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

The bank loans are secured by certain property, plant and equipment, trade receivables and the shares charges over the capital of a subsidiary of the Group and guaranteed by shareholders and a former shareholder of a subsidiary of the Group; Mr. Zhang Zhixiang ("Mr. Zhang"), an executive Director; and a related company of which Mr. Li Baosheng ("Mr. Li"), a former executive Director, is the beneficial owner of that company. The other loans are secured by certain trade receivables and guaranteed by Mr. Zhang and his spouse; Mr. Li and certain subsidiaries within the Group. The obligation under finance leases are secured by leased assets, certain trade receivables, shares charge over the capital of a subsidiary of the Group and guaranteed by Mr. Zhang and his spouse and certain subsidiaries within the Group. The Convertible Bonds are secured by shares charges over the capital of certain subsidiaries within the Group.

The Group has adopted HKFRS 16 "Leases" for accounting period beginning on or after 1 January 2019. As such, leases have been recognised in the form of an asset (for the right-of-use assets) and a financial liability (for the payment obligations) in the Group's consolidated statement of financial position for accounting period beginning on or after 1 January 2019. As at 31 October 2019, the Group had lease liabilities amounted to approximately RMB3.7 million.

Save as aforesaid or otherwise disclosed herein, and apart from intra-group liabilities, the Group did not have any loan capital or debt securities issued or to be issued, outstanding bank overdrafts and liabilities under acceptances or other similar indebtedness, debentures, mortgages, charges or loans or acceptance credits, any other recognized lease liabilities or material lease commitments, or any guarantees or material contingent liabilities as of 31 October 2019.

WORKING CAPITAL
The Directors, after due and careful enquiry, are of the opinion that, taking into account the Sale and Leaseback Agreements and the financial resources available to the Group including internally generated funds and other financing, the Group will have sufficient working capital for its present operating requirements for at least the next twelve months from the date of this circular in the absence of unforeseeable circumstances.
MATERIAL ADVERSE CHANGE
Save for the matters disclosed in the announcement of the Company dated 20 August 2019 in respect of profit warning for the six months ended 30 June 2019, as at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2018, being the date to which the latest published audited financial statements of the Group made up.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

As disclosed in the annual report of the Company for the year ended 31 December 2018, in light of the government support for the development of clean energy where wind power has been served as one of the most critical segments, the Group's wind farm operation business will be expected to experience a rapid growth. With the advantage of a secured development environment in general and the increased level of attention to wind power by the public, the Company is expected to have a bright development prospect.

In terms of business growth strategies, the Group will (i) continue to focus its resources on the development and operation of wind farms and is determined to become one of the pillars of the renewable energy industry in northern China; (ii) speed up the development of renewable energy business by way of cooperative development and acquisitions; (iii) continue to identify and acquire mature power plants with promising development prospects, in order to strengthen the existing wind farm operation and maintenance business in northern China and gradually extend the business to the surrounding areas; (iv) enhance the interaction between other businesses, such as the possible acquisition of wind turbine manufacturing; and

consider other possible opportunities of mergers and acquisitions.

In addition to the principal business operation of wind power, the Group will continue to seek investment opportunities in security trading at a small scale, by setting up joint venture investment with other investors specialised in the industry, aiming to leverage on the advantages of the shareholding companies' capabilities and expand the Group's income stream.

In the long term, the Group will focus its effort on the development and optimisation of existing renewable energy resources. Paralleled to the expansion of wind farm's operational scale and the enhancement of efficiency, the Group will integrate the advantages of all cooperating parties and its own in order to explore more development opportunities and further consolidate the Group's position in the renewable energy industry. During the course of business integration and resources integration, possible synergistic opportunities among different business segments will be explored for their expansions and growth in revenues and profits. The Group is committed to becoming a renewable energy supplier and integrated service provider with relatively strong competitiveness, establishing a stable and comprehensive foundation for the long term growth of the Group, creating more value for the society, and seeking higher returns for the Shareholders and investors.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

6. MANAGEMENT DISCUSSION AND ANALYSIS

The Group is principally engaged in the business of wind farms development and operation as well as wind power generation, through the Hongsong Project and the operation of a wind farm in Baotou City of Inner Mongolia, the PRC (the "Baotou Yinfeng Project"). The Group has commenced to step into the business in finance sector, such as finance leasing and security trading, as disclosed in the annual report of the Company for the year ended 31 December 2018.

The Hongsong Project

Located in Chengde City of Hebei Province in the PRC, the Hongsong Project currently has an installable capacity of 398.4 megawatt and a maximum installable capacity of 596.4 megawatt. Phase nine of the project, known as the Yuanhui project, was completed in December 2013. Its wind farm operation has been making a steady and stable progress and became a significant contribution to the Group's revenue from wind farm operations since the steady acquisition of additional ownership interest in 2013.

The Baotou Yinfeng Project

The Baotou Yinfeng Project is located in Baotou City of Inner Mongolia. The wind farms have been developing since 2016 and the expected installable capacity of phase one of the wind farms operation is 49.8 megawatt. Phase one of the Baotou Yinfeng Project is under construction after obtaining approval in 2015 and is expected to be completed in the coming years and would contribute to the Group's future revenue from the operation of wind farms.

Set out below is the management discussion and analysis of the Group.

For the year ended 31 December 2016 Revenue
For the year ended 31 December 2016, the revenue, which represented the sales value of electricity generated from the wind farm supplied to a power grid company, increased to approximately RMB369.2 million from approximately RMB314.7 million for the year ended 31 December 2015, an increase of approximately 17% which was mainly due to (i) the increase in electricity sales of Hongsong Project and (ii) the revenue generated by

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Hexigten Qi Langcheng Ruifeng Electric Development Co., Ltd.*（克什克騰旗朗誠瑞風電力發展有限公司）("Langcheng"), which later ceased to be a subsidiary of the Group following the disposal during the year ended 31 December 2016.

Segment profit from the wind farm operations increased to approximately RMB107.2 million for the year ended 31 December 2016 from approximately RMB48.6 million for the year ended 31 December 2015, representing a significant increase of approximately 121%.

Loss

Loss for the year ended 31 December 2016 from the continuing operations was approximately RMB11.2 million as compared to the loss of approximately RMB45.9 million for the year ended 31 December 2015. The significant improvement in the result was mainly due to the increase in electricity sales of the Hongsong Project and decrease in administrative expenses.

Discontinued operation

The power grid construction and consultation business was discontinued upon disposal of Hebei Beichen Power Grid Construction Co., Ltd*（河北北辰電網建設股份有限公司）in June 2015.

Net current assets

Net current assets of the Group as at 31 December 2016 decreased to approximately RMB6.4 million when compared with that of approximately RMB77.8 million as at 31 December 2015.

Liquidity and financing

The cash and bank balances as at 31 December 2016 amounted to approximately RMB266.8 million, comprised of approximately RMB204.5 million, HK$69.5 million and USD7,000.

Total borrowings of the Group as at 31 December 2016 amounted to approximately RMB1,553.7 million, representing a decrease by approximately RMB395.4 million when compared with approximately RMB1,949.1 million as at 31 December 2015. The decrease in the total borrowings was mainly

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

resulted from the repayment of borrowings and disposal of Langcheng during the year. Among the total borrowings of the Group as at 31 December 2016 as stated above, approximately RMB611.0 million with maturity within one year, approximately RMB230.5 million with maturity over one year but within two years, approximately RMB426.4 million with maturity in two to five years and approximately RMB285.8 million with maturity over five years.

The Group repaid its debts mainly through the steady recurrent cash-flows generated by its operations and by other equity financing.

The Group's gearing ratio decreased to approximately 65% as at 31 December 2016 from approximately 75% as at 31 December 2015. That ratio was calculated by dividing the Group's total liabilities by its total assets.

Among the interest bearing borrowings amounted to approximately RMB1,553.7 million as at 31 December 2016, approximately RMB307.6 million were fixed rate loans, while approximately RMB1,246.1 million were variable rate loans. The Group had not engaged in any currency hedging facility for the year ended 31 December 2016 as the Board considered that the cost of any hedging facility would be higher than the potential risk of the costs incurred from currency fluctuations and interest rate fluctuations in individual transactions.

Capital management

The Group's primary objectives when managing capital are to safeguard the Group's ability to continue as a going concern while maximising the return to shareholders through the optimisation of the debt and equity balance. The management reviewed the capital structure by considering the cost of capital and the risks associated with each class of capital. In view of this, the Group would balance its overall capital structure through the payment of dividends, new share issues as well as the issue of new debt or the redemption of existing debt as it sees fit and appropriate. The Group's strategy remained unchanged for the year ended 31 December 2016. The Group monitored its capital structure by reviewing its net debt-to-equity ratio and cash flow requirements, taking into account its future financial obligations and commitments.

Issuance of corporate bonds

During the year ended 31 December 2016, the Company issued corporate bonds to potential investors in an aggregate principal amount of HK$11.0 million at par value with maturity date of 3 years and 7 years at the interest rate of 6% and 7% per annum, respectively.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

The net proceeds from the corporate bonds issued were allocated for (i) settling any liabilities arising from previous acquisitions of business by the Group; and (ii) general working capital of the Group. As at 31 December 2016 and 31 December 2015, principal amount of approximately HK$155.2 million and approximately HK$144.2 million of the bonds had been issued, respectively.

Open offer

On 28 January 2016, the Company proposed to raise not less than approximately HK$224.9 million before expenses by issuing not less than 299,856,800 Shares (the "Offer Share(s)") and not more than approximately HK$243.6 million before expenses by issuing not more than 324,840,800 Shares at the subscription price of HK$0.75 per Offer Share on the basis of one Offer Share for every five Shares in issue as at the record date (the "Open Offer"). An underwriting agreement was entered into between the Company and Zhongtai International Securities Limited (the "Underwriter") on 28 January 2016, pursuant to which the Underwriter has conditionally undertaken to underwrite the Offer Shares on a fully underwritten basis.

On 14 April 2016, 299.9 million Offer Shares had been issued and net proceeds of approximately HK$219.5 million was raised. The Company intended to use the net proceeds from the Open Offer as to (i) approximately 45% for the consideration of the possible acquisition of 75% indirect equity interest in Suzlon Energy (Tianjin) Limited Suzlon Energy (Tianjin) Limited*（蘇司蘭能源（天津）有限公司）("Suzlon Tianjin") (the "Possible Acquisition") and other possible acquisition(s) of the Group; (ii) approximately 45% for financing the Group's wind farm development and operation business; and (iii) approximately 10% for the Group's general working capital.

As at 31 December 2016, (i) approximately 45% of the net proceeds was used in settling deposit payment related to the Possible Acquisition and other acquisitions; (ii) approximately 45% of the net proceeds was used to finance the Group's wind farm development and operation business; and (iii) approximately 9% of the net proceeds was used as general working capital of the Group.

Further details of the Open Offer are set out in the announcements of the Company dated 28 January 2016, 9 March 2016 and 13 April 2016, respectively, and the prospectus of the Company dated 17 March 2016.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Issuance of convertible notes

On 26 May 2016, the Company entered into a placing agreement (the "Placing Agreement") with Get Nice Securities Limited (the "Placing Agent") pursuant to which the Placing Agent has conditionally agreed to procure the placee(s) on a best effort basis during the placing period to subscribe for the convertible notes to be issued by the Company of up to an aggregate principal amount of HK$171.6 million due 2017, with the conversion rights to convert the outstanding principal amount of the convertible notes into the Shares at an initial conversion price of HK$0.65 per conversion share (the "Convertible Notes").

Assuming full conversion of the Convertible Notes, a total of 264,000,000 shares of the Company (the "Conversion Shares") would be allotted and issued, representing (i) approximately 14.67% of the issued share capital of the Company as at the date of the Placing Agreement; and (ii) approximately 12.80% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares upon full conversion of the Convertible Notes.

On 15 June 2016, the Convertible Notes in the aggregate principal amount of HK$171.6 million were issued by the Company in accordance with the terms of the Placing Agreement. The net proceeds from the issue of Convertible Notes, after deducting the Placing Agent's commission and other related expenses payable by the Company, amounted to approximately HK$167.9 million.

The Company intended to apply the net proceeds from the issue of Convertible Notes as to (i) approximately 50% for the consideration of the Possible Acquisition, other possible acquisition(s) and investments of the Group, and to finance the Group's wind farm development and operation business; (ii) approximately 40% for the repayment of the outstanding loan borrowings of the Group; and (iii) approximately 10% for the Group's general working capital.

As at 31 December 2016, (i) approximately 50% of the net proceeds was used in settlement for investment of the Group and to finance the Group's wind farm development, including the prepayment and deposit for construction work; and (ii) approximately 24% of the net proceeds was used in repaying the outstanding loan borrowings of the Group.

Further details of the Convertible Notes are set out in the announcements of the Company dated 26 May 2016 and 15 June 2016, respectively.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Capital raising

During the year ended 31 December 2016, save for the Open Offer and the issuance of corporate bonds and Convertible Notes, the Group did not have any capital raising activity.

Material acquisitions and disposal

Acquisition of interest in Shenzhen Qianhai Jiefeng Financing and Leasing Limited*（深圳前海捷豐融資租賃有限公司）("Qianhai Jiefeng")
Upon completion of the acquisition of the entire issued share capital of World Business Limited ("World Business") (which in turn held 25% of the registered capital of Qianhai Jiefeng at the material time) as disclosed in the announcement of the Company dated 17 August 2015, World Business and Qianhai Jiefeng has become a wholly-owned subsidiary and an associate of the Company, respectively. Further to the aforesaid acquisition, on 25 November 2015, World Business and Shenzhen Meixiang Logistics Limited*（深圳美祥物流有限公司）("Shenzhen Meixiang") entered into an equity transfer agreement whereby Shenzhen Meixiang agreed to sell, and World Business agreed to purchase from Shenzhen Meixiang, 24% equity interest in Qianhai Jiefeng for a consideration of RMB0.8 million (the "JF Equity Transfer Agreement").
As at the date of the JF Equity Transfer Agreement, (i) Qianhai Jiefeng had a registered capital of USD35.0 million (equivalent to approximately RMB219.6 million), out of which USD14.9 million (equivalent to approximately RMB93.6 million) was paid up, representing approximately 42.60% of its registered capital; and (ii) World Business and Shenzhen Meixiang contributed approximately USD1.3 million (equivalent to approximately RMB8.4 million) and USD13.6 million (equivalent to approximately RMB85.1 million), respectively, to the registered capital of Qianhai Jiefeng.
Subsequent to the acquisition of 24% equity interest in Qianhai Jiefeng, World Business contributed approximately an additional USD6.8 million (equivalent to approximately RMB44.7 million) and USD3.0 million (equivalent to approximately RMB19.8 million) on 29 February 2016 and 30 June 2016, respectively, to the registered capital of Qianhai Jiefeng.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Subsequent to the said capital contributions and as at 31 December 2016, Qianhai Jiefeng had a paid-up capital of approximately USD24.7 million (equivalent to approximately RMB161.6 million), representing approximately 70.64% of its registered capital. World Business and Shenzhen Meixiang contributed approximately USD11.2 million (equivalent to approximately RMB72.9 million) and USD13.6 million (equivalent to approximately RMB88.7 million), representing 31.88% and 38.76% of the registered capital of Qianhai Jiefeng, respectively.

World Business and Shenzhen Meixiang are required to pay up the remaining registered capital of Qianhai Jiefeng approximately USD10.3 million (equivalent to approximately RMB68.3 million) prior to 31 December 2018 (which may be extended to a later date as approved by the competent governmental authority(ies)) in proportion to their equity holdings, that is, in the amounts of approximately USD6.0 million (equivalent to approximately RMB39.8 million) and USD4.3 million (equivalent to approximately RMB28.5 million), respectively.

Further details are set out in the announcements of the Company dated 17 August 2015 and 28 June 2016, respectively.

Acquisition of interest in Beijing Yin Feng Hui Li Investment Limited*
（北京銀豐匯資本控股有限公司）("Beijing Yinfeng")

On 23 November 2015, Zhuhai Dong Fang Renewable Energy Limited* （珠海東方新生能源有限公司）("Zhuhai Dong Fang", a wholly-owned subsidiary of the Company) entered into an equity transfer agreement with Beijing Tai Run Ze International Investment Limited*（北京泰潤澤國際投資有限公司）and Mr. Cao Yang*（曹洋）to acquire 99% and 1% of the equity interest of Beijing Yinfeng at a cash consideration of approximately RMB10.0 million and RMB10,000, respectively. Cash consideration for the acquisition has been fully settled and upon completion of the acquisition in March 2016, Beijing Yinfeng became a wholly-owned subsidiary of the Company.

Disposal of interest in Langcheng
On 3 May 2016, Hongsong, an indirect non wholly-owned subsidiary of the Company, entered into a capital increase agreement with Inner Mongolia Zhuoneng Investment Co. Ltd.*（內蒙古卓能投資有限公司） ("Zhuoneng") and Mr. Wang Yongquan*（王永全）("Mr. Wang"), each

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

of whom is an independent third party to the Group, and Langcheng (an indirect non-wholly-owned subsidiary of the Company), pursuant to which Mr. Wang and Zhuoneng conditionally agreed to increase the registered capital of Langcheng by RMB83.6 million and RMB4.4 million, respectively, by way of cash (the "Capital Increase").

Upon completion of the Capital Increase, the registered capital of Langcheng was increased from RMB92.0 million to RMB180.0 million, and the equity interest of Hongsong in Langcheng was diluted from 95% to 48.56%. On the even date, Hongsong entered into an equity transfer agreement (the "Equity Transfer Agreement") with Zhuoneng, Langcheng and Mr. Wang, pursuant to which Hongsong conditionally agreed to dispose of and Mr. Wang conditionally agreed to acquire the entire equity interest owned by Hongsong in Langcheng at a consideration of RMB110.0 million (the "LC Disposal"). Upon completion of the LC Disposal, Mr. Wang held 95% equity interest of Langcheng and Langcheng ceased to be a subsidiary of the Company.

On 30 November 2016, Hongsong and Mr. Wang entered into a supplemental agreement to the Equity Transfer Agreement, pursuant to which, the parties agreed to (i) extend the long stop date of the Equity Transfer Agreement from 30 November 2016 to 31 May 2017; and (ii) make further arrangement in respect of the disposal pledge.

Prior to the execution of the Equity Transfer Agreement, Hongsong had (i) provided a guarantee (the "Hongsong's Guarantee") for Langcheng's loan from a PRC bank (the "PRC Bank") of RMB360.0 million for the project(s) undertaken by Langcheng; and (ii) pledged the sale equity interest for a loan of RMB110.0 million (the "Tianxin's Loan") borrowed by it from Tianxin International Company Limited ("Tianxin").

After communication with Tianxin, it was agreed that Hongsong should assist Mr. Wang to proceed with the necessary registration procedures for transfer of the sale equity interest. Upon completion of the registration procedures, Mr. Wang should pledge the sale equity interest to Tianxin as a security (the "Wang's Guarantee") for the Tianxin's Loan until such loan (including accrued interest thereof) being fully repaid by Hongsong.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Mr. Wang had also pledged his 46.44% equity interest in Langcheng (which was derived from his capital injection of RMB83.6 million in Langcheng pursuant to the Capital Increase Agreement dated 3 May 2016) on 30 November 2016 to Hongsong as a counter-guarantee (the "Counter-guarantee") for the Hongsong's Guarantee until such guarantee being discharged. As there was a difference of RMB250.0 million between the Hongsong's Guarantee of RMB360.0 million and the Wang's Guarantee of RMB110.0 million, Mr. Wang agreed to pay a guarantee fee to Hongsong at 0.1% per annum of the guarantee difference of RMB250.0 million until the Hongsong's Guarantee being discharged. The guarantee fee was determined after arm's length negotiation between the parties. Unless otherwise agreed by the parties, Mr. Wang should not transfer any of his equity interest in Langcheng to other party before (i) the Hongsong's Guarantee being discharged and (ii) full repayment of Tianxin's Loan. In the event that Hongsong obtains early discharge of the Hongsong's Guarantee but is yet to fully repay Tianxin's Loan, Hongsong should (i) consent to the release of Mr. Wang's Guarantee; or (ii) pay a guarantee fee to Mr. Wang at 0.1% per annum of Mr. Wang's Guarantee of RMB110.0 million. The guarantee fee was determined after arm's length negotiation between the parties. Mr. Wang undertook to use his best effort to negotiate with the PRC Bank or by any other way, to discharge of the Hongsong's Guarantee as soon as possible.

As the Hongsong's Guarantee has not yet been discharged, the parties agreed to extend the long stop date under the Equity Transfer Agreement from 30 November 2016 to 31 May 2017.

Please refer to the announcements of the Company dated 3 May 2016 and 30 November 2016 for further details of the aforesaid disposal.

Pledge of assets

As at 31 December 2016, the Group had pledged certain property, plant and equipment and certain leasehold land included in lease prepayments with a carrying value of approximately RMB1,035.6 million and trade and other receivables with a carrying value of approximately RMB127.6 million as securities for the borrowings obtained by the Group. As at 31 December 2016, the issued share capital of certain subsidiaries of the Company were pledged for borrowings obtained by the Group.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Contingent liabilities

As at 31 December 2016, the Group had no material contingent liabilities.

Employees

As at 31 December 2016, the Group had approximately 140 full-time employees in Hong Kong and the PRC in respect of the Group's continuing operations. For the year ended 31 December 2016, the relevant staff costs (including Directors' remuneration) were approximately RMB34.9 million. The Group's remuneration and bonus packages were given based on performance of employees in accordance with the general standards of the Group's salary policies.

The Board adopted a new share option scheme on 1 June 2015. During the year ended 31 December 2016, no share options were exercised.

For the year ended 31 December 2017 Revenue
During the year ended 31 December 2017, the Group's revenue was mainly derived from the business of wind power generation. The Group's operating bases for the business of wind power generation are mainly located in Chengde City of Hebei Province and Inner Mongolia, the PRC.
Revenue for the year ended 31 December 2017 was approximately RMB390.0 million, representing an increase of approximately 6% in comparing with that of 2016 of approximately RMB369.2 million. The increase was mainly due to the increase in electricity sales of the Hongsong Project, which outweighed the decrease in revenue of approximately RMB22.1 million for the year of 2016 as contributed by Langcheng which was disposed of by the Group on 3 May 2016, and thus contributed nil revenue for the year.
Profit/(loss)
Profit for the year ended 31 December 2017 was approximately RMB24.1 million. The improvement in the result as compared to that of 2016 was mainly due to the increase in electricity sales by the Hongsong Project together with a decrease in cost of sales and administrative expenses. Loss attributable to equity shareholders was approximately RMB7.1 million.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Net current assets

Net current assets of the Group as at 31 December 2017 increased to approximately RMB46.3 million when compared with that of approximately RMB6.4 million as at 31 December 2016. The increase was mainly due to the decrease in current liabilities as a result of bank loans settlements during the year ended 31 December 2017.

Liquidity and financing

The cash and bank balances as at 31 December 2017 amounted to approximately RMB104.5 million, comprised of approximately RMB101.5 million, HK$2.4 million and USD158,000.

Total borrowings of the Group as at 31 December 2017 amounted to approximately RMB1,356.7 million, representing a decreased by approximately RMB197.0 million when compared with approximately RMB1,553.7 million as at 31 December 2016. The decrease in the total borrowings was mainly resulted from the repayments of borrowings during the year ended 31 December 2017. Among the total borrowings of the Group as stated above, approximately RMB509.5 million with maturity within one year, approximately RMB275.8 million with maturity over one year but within two years, approximately RMB417.9 million with maturity in two to five years and approximately RMB153.5 million with maturity over five years.

The Group repaid its debts mainly through the steady recurrent cash-flows generated by its operations and by other financing. The Group's gearing ratio decreased to approximately 62% as at 31 December 2017 from approximately 65% as at 31 December 2016. That ratio was calculated by dividing the Group's total liabilities by its total assets.

Among the interest bearing borrowings of approximately RMB1,356.7 million as at 31 December 2017, approximately RMB308.8 million were fixed rate loans, while RMB1,047.9 million were variable rate loans.

The Group had not engaged in any currency hedging facility as the Board considered that the cost of any hedging facility would be higher than the potential risk of the costs incurred from currency fluctuations and interest rate fluctuations in individual transactions.

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APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Capital management

The Group's primary objectives when managing capital are to safeguard the Group's ability to continue as a going concern while maximising the return to shareholders through the optimisation of the debt and equity balance. The management regularly reviewed and managed the capital structure by considering the cost of capital and the risks associated with each class of capital. In view of this, the Group would balance its overall capital structure through the payment of dividends, new share issues as well as the issue of new debt or the redemption of existing debt as it sees fit and appropriate. The Group's strategy remained unchanged for the year ended 31 December 2017. The Group monitored its capital structure by reviewing its net debt-to-equity ratio and cash flow requirements, taking into account its future financial obligations and commitments.

Issuance of corporate bonds

During the year ended 31 December 2017, the Company issued additional non- listing corporate bonds to potential investors in an aggregate principal amount of HK$18.5 million at par value with maturity period ranging from 1 year to 7 years, and bearing fixed interest rate at 6% to 7% per annum.

The Company intended to use the net proceeds from the corporate bonds for general working capital of the Group. As at 31 December 2017 and 31 December 2016, principal amount of approximately HK$173.7 million and HK$155.2 million of the corporate bonds had been issued, respectively.

Extension of the Convertible Notes

On 12 December 2017, the Company and all the holders of the Convertible Notes entered into a deed of amendment to extend the maturity date of the Convertible Notes from 15 December 2017 to 15 June 2019.

Further details are set out in the announcements of the Company dated 26 May 2016, 15 June 2016, 12 December 2017 and 19 December 2017, respectively.

Capital raising

During the year ended 31 December 2017, save for the issuance of corporate bonds, the Group did not have any capital raising activity.

- I-15 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Material acquisition and disposal

Acquisition of 20% equity interest in in Candice Group Limited

On 28 September 2017, (i) On Win Corporation Limited, a wholly-owned subsidiary of the Company, as the purchaser entered into a sale and purchase agreement with Huajun Logistics Co. Limited and Gather Take Development Limited who agreed to sell the sale shares (representing 23% equity interests in Candice Group Limited ("Candice Group")) for the sale consideration of approximately HK$9.5 million upon the terms and conditions set out in the sale and purchase Agreement; and (ii) On Win Corporation Limited, Mr. Ng Yuk Ping and Evergrace Fund Limited, as the subscribers, entered into a subscription agreement with Candice Group, pursuant to which Candice Group conditionally agreed to allot and issue to the subscribers, and the subscribers conditionally agreed to subscribe for, a total of 40,000 subscription shares at the subscription price of HK$411.39 each upon the terms and conditions set out in the subscription agreement. Upon completion of the transactions, the Company would indirectly own 20% equity interest in Candice Group. Transaction was completed on 31 October 2017.

Please refer to the announcements of the Company dated 28 September 2017 and 31 October 2017 for further details.

Financial guarantee to Langcheng

With the efforts made by all involved parties, on 28 December 2017, the Hongsong's Guarantee had been discharged from the PRC Bank and the Group has fully repaid the Tianxin's Loan. The Counter-guarantee provided by Mr. Wang has also been released by Hongsong accordingly.

Please refer to the announcements of the Company dated 3 May 2016, 30 November 2016, 31 May 2017, 31 August 2017 and 29 December 2017 for further details of the aforesaid transactions.

Pledge of assets

As at 31 December 2017, the Group had pledged certain property, plant and equipment and certain leasehold land included in lease prepayments with a carrying value of approximately RMB1,035.2 million, and trade and other receivables with a carrying value of approximately RMB201.0 million as

- I-16 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

securities for the borrowings obtained by the Group. As at 31 December 2017 and 31 December 2016, the issued share capital of certain subsidiaries of the Company were pledged for borrowings obtained by the Group.

Contingent liabilities

As at 31 December 2017, the Group had no material contingent liabilities.

Employees

As at 31 December 2017, the Group had approximately 140 full-time employees in Hong Kong and the PRC in respect of the Group's operations. For the year ended 31 December 2017, the relevant staff costs (including directors' remuneration) were approximately RMB39.4 million. The Group's remuneration and bonus packages were given based on performance of employees in accordance with the general standards of the Group's salary policies.

The Board adopted a share option scheme on 1 June 2015. During the year ended 31 December 2017, no share options were granted under the share option scheme.

For the year ended 31 December 2018 Revenue
For the year ended 31 December 2018, the total revenue decreased to approximately RMB361.2 million from approximately RMB390.0 million for the year ended 31 December 2017, representing a decrease of approximately 7%.
The segment profit from the wind farm operations decreased to approximately RMB107.6 million from approximately RMB136.1 million for the year ended 31 December 2017, representing a decrease of approximately 21% which was mainly attributed to the decrease in electricity sales of the Hongsong Project.
Loss
Loss for the year ended 31 December 2018 was approximately RMB37.3 million as compared to the profit of approximately RMB24.1 million for the year ended 31 December 2017. The significant drop was mainly due to (i) the

- I-17 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

decrease in electricity sales by Hongsong; (ii) an increase in cost of sales and administrative expenses; and (iii) share-based payment arising from issue of the Convertible Notes 2 (as defined below).

Liquidity and financing

The cash and bank balances as at 31 December 2018 amounted to approximately RMB62.5 million, comprised of approximately RMB60.5 million, HK$2.1 million and USD22,000.

Total borrowings of the Group as at 31 December 2018 amounted to approximately RMB1,473.6 million, representing an increase by approximately RMB116.9 million from 31 December 2017, mainly resulted from the addition of new borrowings during the reporting period. Among the total borrowings of the Group as stated above, approximately RMB717.4 million with maturity within one year, approximately RMB231.1 million with maturity over one year but within two years, approximately RMB433.8 million with maturity in two to five years and approximately RMB91.3 million with maturity over five years.

The Group repaid its debts mainly through the steady recurrent cash-flows generated by its operations and by other financings. The Group's gearing ratio increased to approximately 66% as at 31 December 2018 from approximately 62% as at 31 December 2017. That ratio was calculated by dividing the Group's total liabilities by its total assets.

Among the interest bearing borrowings of approximately RMB1,473.6 million, approximately RMB499.2 million were fixed rate loans, while approximately RMB974.4 million were variable rate loans. The Group had not engaged in any currency hedging facility for the year ended 31 December 2018 as the Board considered that the cost of any hedging facility would be higher than the potential risk of the costs incurred from currency fluctuations and interest rate fluctuations in individual transactions.

Capital management

- I-18 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

through the payment of dividends, new share issues as well as the issue of new debt or the redemption of existing debt as it sees fit and appropriate. The Group's strategy remained for the year ended 31 December 2018.

The Group monitored its capital structure by reviewing its net debt-to-equity ratio and cash flow requirements, taking into account its future financial obligations and commitments.

Issuance of corporate bonds

In July and October 2018, the Company issued additional non-listing corporate bonds to investors in an aggregate principal amount of HK$15.0 million at par value with maturity in 1 year to 6 years, and bearing fixed interest rate at 6% to 7% per annum.

All the net proceeds from the bonds issued in the year of 2018 had been utlilised and as at 31 December 2018 and 31 December 2017, principal amount of approximately HK$181.2 million and approximately HK$173.7 million of the bonds had been issued and had not been repaid, respectively.

Extension of the Convertible Notes

Up to 31 December 2018, no conversion share had been allotted or issued from the conversion of the Convertible Notes.

Equipment purchase agreements and finance lease agreement

On 7 February 2018, Baotou City Yinfeng Huili New Energy Investment Limited*（包頭市銀風匯利新能源投資有限公司）("Baotou Yinfeng"), an indirect wholly-ownedsubsidiary of the Company, Hengqin Financial Investment Leasing Company Limited*（橫琴金融投資集團有限公司） ("Hengqin FI"), Baotou Tianshun Wind Power Equipment Company Limited* （包頭天順風電設備有限公司）("Tianshun") and Suzlon Tianjin entered into the equipment purchase agreements, pursuant to which Hengqin FI agreed to purchase (i) 23 sets of SUZLON s88 wind power towers and 1 set of SUZLON s97 wind power tower from Tianshun at consideration of approximately RMB23.3 million; and (ii) 17 sets of SUZLON s88 wind power generators from Suzlon Tianjin at a consideration of approximately RMB136.4 million.

On the same date, Baotou Yinfeng and Hengqin FI also entered into a finance lease agreement, pursuant to which Hengqin FI agreed to lease the purchased assets to Baotou Yinfeng for a period of 60 months at a total lease payment of approximately RMB155.0 million of which approximately RMB141.9 million

- I-19 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

shall be paid in twenty instalments for the first phrase and the remaining shall be paid in another twenty instalments as for the second phrase.

Up to 31 December 2018, the Company has drawn down an aggregate amount of approximately RMB117.2 million.

Further details are set out the announcements of the Company dated 13 April 2018 and 3 May 2018 respectively.

Finance lease arrangement

On 11 September 2018, Jiyin Financial Leasing Company Limited*（冀銀金融租賃股份有限公司）("Jiyin Leasing") and Hongsong entered into a finance lease agreement and an asset transfer agreement, pursuant to which Jiyin Leasing agreed to purchase the wind power generators and the ancillaries of the phase 6 wind power energy project undertaken at the Hebei Pui Feng wind power farm*（河北沛楓風電場）by Hongsong at an aggregate consideration of RMB120.0 million, which shall be leased back to Hongsong for a term of 3 years at a total lease payment of approximately RMB132.3 million.

Further details of the finance lease arrangements are set out of the announcement of the Company dated 11 September 2018.

Issuance of convertible notes

On 24 April 2018, the Company entered into a placing agreement with Golden Rich Securities Limited (the "Placing Agent 2"), an independent third party, pursuant to which the Placing Agent 2 has conditionally agreed to procure the place(s) on a best effort basis during the placing period to subscribe for the convertible notes to be issued by the Company of up to an aggregate principal amount of approximately HK$174.1 million, with the conversion rights to convert the outstanding principal amount of the convertible notes into the Shares at an initial conversion price of HK$0.485 per conversion share (the "Convertible Notes 2").

Assuming full conversion of the Convertible Notes 2, a total of 359.0 million Shares would be allotted and issued, representing (i) approximately 19.95% of the then existing issued share capital of the Company; and (ii) approximately 16.63% of the issued share capital of the Company as enlarged by the allotment and issue of the conversion shares upon full conversion of the Convertible Notes 2.

- I-20 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

On 11 May 2018, the Convertible Notes 2 in the aggregate principal amount of HK$174.1 million were issued by the Company. The net proceeds generated from the issue of Convertible Notes 2, after deducting the commission and other related expenses payable by the Company, amounted to approximately HK$172.3 million.

As at 31 December 2018, all the net proceeds from the Convertible Notes 2 had been utlilised in repaying the outstanding loan borrowing of the Group. No conversion share has been allotted or issued from the conversion of the Convertible Notes 2.

Further details of the issuance of Convertible Notes 2 are set out in the announcements of the Company dated 24 April 2018, 30 April 2018 and 11 May 2018 respectively.

Issuance of convertible bonds

On 31 December 2018, the Company, Filled Converge Limited ("Filled Converge") and Well Foundation Company Limited ("Well Foundation") entered into a subscription agreement, pursuant to which the Company conditionally agreed to issue and (i) Filled Converge conditionally agreed to subscribe for the convertible bonds in the principal amount of HK$294.2 million and (ii) Well Foundation conditionally agreed to subscribe for the convertible bonds in the principal amount of approximately HK$19.6 million (the "Convertible Bonds").

The Convertible Bonds are in aggregation in the amount of approximately HK$313.8 million due at 2021 and extendable to 2022 at an interest rate of 8 per cent per annum, with the conversion rights to convert the outstanding principal amount of the Convertible Bonds into the Shares at an initial conversion price of HK$0.485 per conversion share.

Assuming full conversion of the Convertible Bonds, a total of 647 million new Shares, being the conversion shares, would be allotted and issued, representing

approximately 35.96% of the issued share capital of the Company as at the date of the subscription agreement; and (ii) approximately 26.45% of the issued share capital of the Company as enlarged by the allotment and issue of the conversion shares upon full conversion of the Convertible Bonds.

- I-21 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

The Company had intended to apply the net proceeds from the issue of Convertible Bonds as to (i) approximately 39% for the repayment of bank loan(s); (ii) approximately 57% for the redemption of the existing Convertible Bonds; and (iii) approximately 4% for general working capital of the Group.

On 20 June 2019, the Company announced a change in the use of proceeds which (i) approximately HK$119.0 million of the net proceeds of the subscription of Convertible Bonds for repayment of bank loans; (ii) approximately HK$174.0 million of the net proceeds for redemption of existing Convertible Bonds; and (iii) approximately HK$12.2 million of the net proceeds for general working capital of the Group.

As at 20 June 2019, the Company had utilised as to (i) approximately HK$40.0 million of the net proceeds for the repayment of bank loans; (ii) approximately HK$174.0 million of the net proceeds for the redemption of existing Convertible Bonds and (iii) approximately HK$7.0 million of the net proceeds for the general working capital of the Group.

Further details of the issuance of Convertible Bonds are set out in the announcements of the Company dated 31 December 2018, 1 February 2019 and 20 June 2019, and the circular of the Company dated 30 January 2019.

Net current liabilities

Net current liabilities of the Group as at 31 December 2018 increased to approximately RMB273.6 million when compared with that of approximately RMB82.7 million (restated) as at 31 December 2017. The increase was mainly due to the increase in current liabilities as a result of the maturity of the Convertible Notes and Convertible Notes 2.

Capital raising

During the year ended 31 December 2018, save for the issuance of corporate bonds, Convertible Notes 2 and the Convertible Bonds, the Group did not have any capital raising activity.

Material acquisition and disposal

There were no material acquisition and disposal of subsidiaries and associated companies by the Group for the year ended 31 December 2018.

- I-22 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Pledge of assets

As at 31 December 2018, the Group had pledged certain property, plant and equipment and certain leasehold land included in lease prepayments with a carrying value of approximately RMB877.3 million, and trade and other receivables with a carrying value of approximately RMB243.0 million as securities for the borrowings obtained by the Group.

As at 31 December 2018, the issued share capital of certain subsidiaries of the Company were pledged for borrowings obtained by the Group.

Contingent liabilities

As at 31 December 2018, the Group had no material contingent liabilities.

Employees

As at 31 December 2018, the Group had approximately 140 full-time employees in Hong Kong and the PRC in respect of the Group's operations. For the year ended 31 December 2018, the relevant staff costs (including directors' remuneration) were approximately RMB40.4 million. The Group's remuneration and bonus packages were given based on performance of employees in accordance with the general standards of the Group's salary policies.

The Board adopted a share option scheme on 1 June 2015. During the year ended 31 December 2018, no share options were granted under the share option scheme.

For the six months ended 30 June 2019 Revenue
For the six months ended 30 June 2019, the Group's revenue was mainly derived from the business of wind power generation of Hongsong which contributed a stable source of revenue to the Group.
Revenue from wind farms operation was approximately RMB202.8 million for the six months ended 30 June 2019, representing a decrease of approximately 2% as compared with approximately RMB207.4 million of the corresponding period of 2018. The decrease was mainly due to the decrease in amount of

- I-23 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

electricity generated as well as the sales of electricity as disclosed in the interim report of the Company for the six months ended 30 June 2019.

Profit

The net profit for the six months ended 30 June 2019 was approximately RMB4.0 million, representing a substantial decrease as compared with approximately RMB44.1 million of the corresponding period in 2018. The substantial decrease in net profit was mainly due to the increase in financial costs for the six months ended 30 June 2019 and the non-cash and non- operating item on expenses related to share-based payment arising from the issue of Convertible Bonds incurred for the six months ended 30 June 2019.

Liquidity and financing

The cash and bank balances as at 30 June 2019 amounted to approximately RMB122.7 million comprised of approximately RMB49.0 million, USD22,000 and HKD83.7 million.

Total borrowings of the Group as at 30 June 2019 amounted to approximately RMB1,497.7 million, representing an increase of approximately 1.6% as compared with approximately RMB1,473.6 million as at 31 December 2018. The increase was the combined effect of (i) issuance of new Convertible Bonds by the Company on 25 March 2019; (ii) redemption of Convertible Notes 2 due on 11 May 2019; and (iii) repayments of bank loans during the six months ended 30 June 2019. Among the total borrowings of the Group as stated above, approximately RMB506.8 million with maturity within one year, approximately RMB513.6 million with maturity over one year but within two years, approximately RMB397.3 million with maturity in two to five years and approximately RMB80.0 million with maturity over five years.

The Group repaid its debts mainly through steady recurrent cash-flows generated by its operations and by other financing. The Group's gearing ratio as at 30 June 2019 was approximately 66% which was comparable to approximately 66% as at 31 December 2018. That ratio was calculated by dividing the Group's total liabilities by its total assets.

Among the interest bearing borrowings of the Group, approximately RMB663.8 million were fixed rate loans and approximately RMB833.9 million were variable rate loans. As disclosed in the interim report of the Company

- I-24 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

for the six months ended 30 June 2019, the Group had not engaged in any hedging facility against interest rate fluctuations for the six months ended 30 June 2019 as the Board considered that the cost of any hedging policy would be higher than the potential risk of the costs being incurred from interest rate fluctuations in individual transactions.

Issuance of corporate bonds

During the six months ended 30 June 2019, the Company did not issue additional non-listing corporate bonds. As at 30 June 2019 and 31 December 2018, principal amount of approximately HKD177.2 million and HKD181.2 million of the corporate bonds had been issued, respectively.

Extension of the Convertible Notes

On 22 August 2019, the Company and all the holders of the Convertible Notes entered into a second deed of amendment (the "Second Amendment Deed") to (i) further extend the maturity date of the Convertible Notes from 15 June 2019 to 15 December 2019; (ii) amend the interest rate of the Convertible Notes from 8% to 10% per annum with effect from 15 June 2019 and (iii) require the Company to pay on the date of the Second Amendment Deed interest accrued and to be accrued from (and including) 15 June 2019 to (but excluding) 15 December 2019.

Further details are set out in the announcements of the Company dated 26 May 2016, 15 June 2016, 12 December 2017, 19 December 2017, 22 August 2019 and 23 August 2019 respectively.

Issuance of the Convertible Bonds

On 31 December 2018, the Company, Filled Converge and Well Foundation entered into a subscription agreement, pursuant to which the Company conditionally agreed to issue and Filled Converge conditionally agreed to subscribe for the Convertible Bonds. The Convertible Bonds are in aggregation in the amount of HKD313.8 million due at 2021 and extendable to 2022 at an interest rate of 8% per annum, with the conversion rights to convert the outstanding principal amount of the Convertible Bonds into the Shares at an initial conversion price of HK$0.485 per conversion share.

- I-25 -

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Further details of the issuance of the Convertible Bonds are set out in the announcements of the Company dated 31 December 2018, 1 February 2019, 25 March 2019 and 20 June 2019, and the circular of the Company dated 30 January 2019.

Capital raising

During the six months ended 30 June 2019, save for the issuance of the Convertible Bonds, the Group did not have other capital raising activity.

Material acquisition and disposal

There were no material acquisition and disposal of subsidiaries and associated companies by the Group for the six months ended 30 June 2019.

Pledge of assets

As at 30 June 2019, the Group had pledged certain property, plant and equipment and certain leasehold land including in right-of-use assets with a carrying value of approximately RMB835.1 million in total, and trade and other receivables with a carrying value of approximately RMB273.5 million as security for the borrowings obtained by the Group. As at 30 June 2019, certain shares of certain subsidiaries of the Company were pledged for borrowings obtained by the Group.

Contingent liabilities

As at 30 June 2019, the Group had no material contingent liabilities.

Employees

As at 30 June 2019, the Group had approximately 140 full-time employees in Hong Kong and the PRC in respect of the Group's operations. For the six months ended 30 June 2019, the relevant staff costs (including directors' remuneration) were approximately RMB19.6 million. The Group's remuneration and bonus packages were given based on the performance of its employees in accordance with the general standards of the Group's salary policies.

- I-26 -

APPENDIX II	UNAUDITED STATEMENTS OF PROFIT OR
	LOSS ON THE LEASED ASSETS

Unaudited statements OF PROFIT OF LOSS on the Leased Assets

In accordance with paragraph 14.68(2)(b)(i) of the Listing Rules, the unaudited statement of profit or loss on the identifiable net income stream of the Leased Assets for the years ended 31 December 2016, 2017 and 2018 and for the six months ended 30 June 2019 (the "Relevant Period") (the "Unaudited Statements of Profit or Loss on the Leased Assets") are set out below.

In the opinion of the Directors, such information has been properly compiled and derived from the underlying books and records of Hongsong. The Company has engaged ZHONGHUI ANDA CPA Limited to conduct certain factual finding procedures on the compilation of such information in accordance with the Hong Kong Standard on Related Services 4400, "Engagements to Perform Agreed-Upon Procedures Regarding Financial Information" issued by the Hong Kong Institute of Certified Public Accountants. The reporting accountant has agreed the Unaudited Statements of Profit or Loss on the Leased Assets to the underlying books and records of the Lessee in accordance with the agreed- upon procedures set out in the relevant engagement letter between the Company and the reporting accountant and reported its factual findings based on the agreed-upon procedures to the Directors.

						Six months
						ended
	For the year ended 31 December	30 June
	2016		2017		2018	2019
	RMB'000	RMB'000	RMB'000	RMB'000
Turnover	344,653		387,706		359,105	201,676
Cost of sales	(218,326)	(211,394)	(215,622)	(96,234)
Gross profit	126,327		176,312		143,483	105,442
Other revenue and net income	27,564		26,824		27,609	22,869
Administrative expenses	(13,047)	(19,640)	(17,339)	(5,098)
Profit from operations	140,844		183,496		153,753	123,213
Finance costs	(54,319)	(48,126)	(39,940)	(18,715)
Profit before taxation	86,525		135,370		113,813	104,498
Income tax	(23,784)	(30,834)	(24,991)	(25,902)
Profit for the year/period	62,741		104,536		88,822	78,596

- II-1 -

APPENDIX II	UNAUDITED STATEMENTS OF PROFIT OR
	LOSS ON THE LEASED ASSETS

The procedures being performed on the Unaudited Statements of Profit or Loss on the Leased Assets of the Group and the findings are summarised as follows:

the following documents were obtained and prepared by the management of the Company:
1. the Unaudited Statements of Profit or Loss on the Leased Assets;
2. The management accounts and general ledger of Hongsong for the Relevant Period; and
3. The reconciliation schedules.
agreed the Unaudited Statements of Profit or Loss on the Leased Assets to relevant accounting records of the Lessee, including general ledger, sub ledger and reconciliation schedules prepared by the management, trace the unaudited amount in the reconciliation schedules to the relevant accounting records of the Lessee and found the amounts to be in agreement; and
recalculated the adjustments based on corresponding amounts in the relevant accounting records and based on the formulae specified by the management, which we made no comment on the completeness, reasonableness or appropriateness of these formulae and found the amounts be arithmetically accurate.

Because the above procedures did not constitute an assurance engagement performed in accordance with Hong Kong Standards on Auditing, Hong Kong Standards on Review Engagements or Hong Kong Standards on Assurance Engagements issued by the Hong Kong Institute of Certified Public Accountants (collectively referred to as Hong Kong Assurance Standards), no assurance is provided by the reporting accountant on the Unaudited Statements of Profit or Loss on the Leased Assets of the Group. Had the reporting accountant performed additional procedures or had the reporting accountant performed an assurance engagement in respect of the Unaudited Statements of Profit or Loss on the Leased Assets of the Group in accordance with Hong Kong Assurance Standards, other matters might have come to their attention that would have been reported to the Directors.

The report is solely for the purpose for the information of the Directors, and is not to be used for any other purpose or to be distributed to any other parties. The report relates only to the items specified above and does not extend to the financial statements of the Group taken as a whole.

- II-2 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

UNAUDITED PRO FORMA FINANCIAL INFORMATION
The accompanying unaudited pro forma statement of net assets and unaudited pro forma statement of profit or loss (collectively referred to as the "Unaudited Pro Forma Financial Information") have been prepared by the Directors in accordance with paragraph 29 of Chapter 4 of the Listing Rules for the purpose of illustrating the effects upon completion of the Sale and Leaseback Agreements (the "Transaction").
The unaudited pro forma statement of net assets of the Group has been prepared based on the unaudited consolidated statement of financial position of the Group as at 30 June 2019 which has been extracted from the Group's published interim financial statements for the six months ended 30 June 2019, after making certain pro forma adjustments resulting from the Transaction as if the Transaction had been completed on 30 June 2019.
The unaudited pro forma statement of profit or loss of the Group are prepared based on the unaudited consolidated statement of profit or loss of the Group for the year ended 31 December 2018 as extracted from the Group's published annual report for the year ended 31 December 2018, after making certain pro forma adjustments resulting from the Transaction as if the Transaction had been completed on 1 January 2018.
The Unaudited Pro Forma Financial Information is prepared based on a number of assumptions, estimates, uncertainties and currently available information, and is provided for illustrative purposes only. Accordingly, as a result of the nature of the Unaudited Pro Forma Financial Information, it may not give a true picture of the actual results of operations and financial position of the Group that would have been attained had the Transaction actually occurred on the dates indicated herein. Furthermore, the Unaudited Pro Forma Financial Information does not purport to predict the Group's future financial position or results of operations.
The Unaudited Pro Forma Financial Information should be read in conjunction with other financial information included elsewhere in the circular.

- III-1 -

APPENDIX III		UNAUDITED PRO FORMA FINANCIAL
				INFORMATION OF THE GROUP

PRO FORMA STATEMENT OF NET ASSETS
							Pro forma
	The Group				The Group
	(Unaudited)	Pro forma adjustment	(Unaudited)
		RMB'000	RMB'000	RMB'000	RMB'000		RMB'000
		(Note 1)	(Note 3)	(Note 4)	(Note 5)
Non-current assets
Property, plant and equipment	1,429,385					1,429,385
Interest in an associate	90,389					90,389
Interest in joint venture	5,437					5,437
Right-of-use assets	14,106					14,106
Financial assets at fair value
through other comprehensive
income	7,500					7,500
Financial assets at fair value
through profit or loss	5,225					5,225
Guarantee deposit				54,000			54,000
Prepayments and other
receivables		301,711						301,711
	1,853,753					1,907,753
Current assets
Financial assets at fair value
through profit or loss	4,218					4,218
Inventories	161					161
Trade receivables	250,366					250,366
Prepayments and other
receivables	435,827					435,827
Cash and cash equivalents		122,722		1,726,000	(1,470,429)	(21,235)		357,058
		813,294					1,047,630

- III-2 -

APPENDIX III		UNAUDITED PRO FORMA FINANCIAL
				INFORMATION OF THE GROUP

							Pro forma
	The Group				The Group
	(Unaudited)	Pro forma adjustment	(Unaudited)
		RMB'000	RMB'000	RMB'000	RMB'000		RMB'000
		(Note 1)	(Note 3)	(Note 4)	(Note 5)
Current liabilities
Trade and other payables	226,487				(21,235)	205,252
Borrowings	506,816			(506,816)			-
New borrowings		-	178,600			178,600
Lease liabilities	3,008					3,008
Current taxation		6,775						6,775
	743,086					393,635
Net current assets
70,208					653,995
Total assets less current
liabilities	1,923,961					2,561,748
Non-current liabilities
Borrowings	990,848			(960,848)		30,000
New borrowings		-	1,603,400			1,603,400
Lease liabilities	1,211					1,211
Deferred tax liabilities	24,216					24,216

	1,016,275					1,658,827
Net assets	907,686					902,921

- III-3 -

APPENDIX III					UNAUDITED PRO FORMA FINANCIAL
						INFORMATION OF THE GROUP

PRO FORMA STATEMENT OF PROFIT OR LOSS
										Pro forma
	The Group						The Group
		(Audited)		Pro forma adjustment		(Unaudited)
		RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000		RMB'000
		(Note 1)	(Note 6)	(Note 7)	(Note 8)	(Note 9)	(Note 10)
Revenue	361,184								361,184
Cost of sales	(217,373)						(217,373)
Gross profit	143,811								143,811
Interest income	12,237								12,237
Other revenue and
net income	29,645								29,645
Administrative
expenses	(82,760)		23,624		(18,791)	(2,000)	(79,927)
Profit from
operations	102,933								105,766
Finance costs	(120,434)	102,515	10,752	(123,466)			(130,633)
Share of profits
less losses of
associates	6,807								6,807
Share of losses of a
joint venture	(1,235)						(1,235)
Loss before
taxation	(11,929)						(19,295)
Income tax		(25,329)	(9,403)		30,867			(3,865)
Loss for the year
	(37,258)						(23,160)

- III-4 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

Notes to the Unaudited Pro Forma Financial Information of the Group

The unaudited consolidated statement of financial position of the Group as at 30 June 2019 was extracted from the Group's unaudited financial statements for the six months ended 30 June 2019 in the Group's published interim report for the six months ended 30 June 2019. The audited consolidated statement of profit or loss of the Group for the year ended 31 December 2018 was extracted from the Group's audited financial statements for the year ended 31 December 2018 in the Group's published annual report for the year ended 31 December 2018.
According to HKFRS 16, since the substance of the Transaction does not satisfy the requirements of HKFRS 15 to be accounted for as a sale of the Leased Assets, the Group shall continue to recognise the Leased Assets and shall recognise new borrowings according to HKFRS 9. Therefore, the Transaction shall be accounted for as a financing transaction and would not give rise to any gain or loss, or reduction in value of the Leased Assets.
The adjustment is to reflect (i) the receipt of sales consideration of approximately RMB1,800,000,000 net of the handling fee of approximately RMB18,000,000 which is payable to the Lessor before commencement of the lease terms of the Transaction, (ii) the payment of guarantee deposit of RMB54,000,000 and (iii) the payment of first year's insurance fees of approximately RMB2,000,000 as if the Transaction completed on 30 June 2019.
Reconciliation to the net consideration:

	RMB
Net consideration as per pro forma statement of net assets	1,726,000,000
Less: future handling fees (note)	(86,000,000)
Less: future insurance fees (note)	(17,000,000)
Net consideration	1,623,000,000

Note: The future handling fees of approximately RMB86,000,000 and insurance fees of approximately RMB17,000,000 will be incurred throughout the lease periods. Therefore, there would not be any impact to the net assets of the Group on 30 June 2019.

- III-5 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

4. The adjustment is to reflect the repayment of borrowings as if the Transaction completed on 30 June 2019. The analysis of the loss arising from the settlement of borrowings is as follows:

	Convertible
		notes and
	convertible		Other
		bonds	borrowings	Total
		RMB		RMB	RMB
Carrying amounts of borrowings as
at 30 June 2019	424,722		1,042,942		1,467,664
Less: Amounts of cash settlement*	(427,487)	(1,042,942)	(1,470,429)
Loss arising on the repayment of
borrowings charged to profit or
loss	(2,765)		-	(2,765)

For the purpose of preparing the Unaudited Pro Forma Financial Information, it is assumed that the fair values of liability component of the Convertible Notes and Convertible Bonds as at 30 June 2019 approximate to the amounts of cash settlement.

5. The adjustment is to reflect the settlement of dividend payable to the non- controlling interest of the Lessee ("NCI"), as below:

	RMB
Dividend payable of the Lessee	78,130,000
Less: dividend payable to the Group	(56,895,000)

Dividend payable to NCI	21,235,000

6. The adjustment is to reflect the reversal of the finance costs in connection with the borrowings which would be fully repaid under Transaction and their income tax effect as if the Transaction completed on 1 January 2018.

The adjustment is not expected to have a continuing effect on the Group.

- III-6 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

Assuming that the Transaction had completed on 1 January 2018, the convertible notes with principal amount of HK$174,115,000 would not be have issued during the year ended 31 December 2018. The adjustment is to reflect the reversal of the share based payment arising from the issue of such convertible notes and the related interest expenses.
The adjustment is not expected to have a continuing effect on the Group.
The adjustment is to reflect the finance costs incurred for the new borrowings and its income tax effect.
The adjustment is expected to have a continuing effect on the Group.
The adjustment is to reflect recognition of the loss arising on the early redemption of the convertible notes as if the Transaction completed on 1 January 2018.
The adjustment is not expected to have a continuing effect on the Group.
The adjustment is to reflect the first year's insurance fees incurred for the Transaction.
The adjustment is expected to have a continuing effect on the Group.

- III-7 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

ACCOUNTANT'S REPORT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following is the text of a report, prepared for the sole purpose of inclusion in this circular, from the independent reporting accountant, ZHONGHUI ANDA CPA Limited.

24 December 2019

The Board of Directors

China Ruifeng Renewable Energy Holdings Limited

Dear Sirs,

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of China Ruifeng Renewable Energy Holdings Limited (the "Company") and its subsidiaries (hereinafter collectively referred to as the "Group") by the directors of the Company for illustrative purposes only. The unaudited pro forma financial information consists of the pro forma statement of net assets as at 30 June 2019 and the pro forma statement of profit or loss for the year ended 31 December 2018 and related notes as set out on pages

III-2 to III-7 of the circular dated 24 December 2019 issued by the Company. The applicable criteria on the basis of which the directors have compiled the unaudited pro forma financial information are described on page III-1.

The unaudited pro forma financial information has been compiled by the directors to illustrate the impact of the sales and lease back arrangement on the Group's financial position as at 30 June 2019 and on the Group's financial performance for the year ended 31 December 2018 as if the transaction had been taken place at 30 June 2019 and 1 January 2018 respectively. As part of this process, information about the Group's financial position has been extracted by the directors from the Group's condensed financial statements as included in the interim report for the six months ended 30 June 2019, on which no audit or review report has been published and information about the Group's financial performance has been extracted by the directors from the Group's consolidated financial statements as included in the annual report for the year ended 31 December 2018, on which an audit report has been published.

- III-8 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

Directors' Responsibility for the Unaudited Pro Forma Financial Information

The directors are responsible for compiling the unaudited pro forma financial information in accordance with paragraph 29 of Chapter 4 of the Rules Governing the Listing of Securities on The Stock exchange of Hong Kong Limited (the "Listing Rules") and with reference to Accounting Guideline ("AG") 7 "Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars" issued by the Hong Kong Institute of Certified Public Accountants (the "HKICPA").

Our Independence and Quality Control

We have complied with the independence and other ethical requirement of the Code of Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.

The firm applies Hong Kong Standard on Quality Control 1 and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Reporting Accountant's Responsibilities

Our responsibility is to express an opinion, as required by paragraph 29(7) of Chapter 4 of the Listing Rules, on the unaudited pro forma financial information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the unaudited pro forma financial information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 "Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus" issued by the HKICPA. This standard requires that the reporting accountant plan and perform procedures to obtain reasonable assurance about whether the directors have compiled the unaudited pro forma financial information in accordance with paragraph 29 of Chapter 4 of the Listing Rules and with reference to AG 7 "Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars" issued by the HKICPA.

- III-9 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the unaudited pro forma financial information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the unaudited pro forma financial information.

The purpose of unaudited pro forma financial information included in an investment circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the Group as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the event or transaction at 1 January 2018 and 30 June 2019 would have been as presented.

A reasonable assurance engagement to report on whether the unaudited pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the directors in the compilation of the unaudited pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

The related pro forma adjustments give appropriate effect to those criteria; and
The unaudited pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountant's judgment, having regard to the reporting accountant's understanding of the nature of the Group, the event or transaction in respect of which the unaudited pro forma financial information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

- III-10 -

APPENDIX III	UNAUDITED PRO FORMA FINANCIAL
	INFORMATION OF THE GROUP

Opinion

In our opinion:

the unaudited pro forma financial information has been properly compiled on the basis stated;
such basis is consistent with the accounting policies of the Group; and
the adjustments are appropriate for the purposes of the unaudited pro forma financial information as disclosed pursuant to paragraph 29(1) of Chapter 4 of the Listing Rules.

Yours faithfully,

ZHONGHUI ANDA CPA Limited

Certified Public Accountants

Sze Lin Tang

Practising Certificate Number P03614

Hong Kong

- III-11 -

APPENDIX IV	VALUATION REPORT

This report is prepared in accordance with China Valuation Standards

Valuation Project for the Proposed Understanding of the Value of Certain Assets Held by Hebei Hongsong Wind Power Co., Ltd.

Asset Valuation Report

Zhuo Xin Da Hua Ping Bao Zi (2019) No. 3010

(Volume 1, Book 1)

Beijing Zhuoxindahua Appraisal Co., Ltd.

29 November 2019

- IV-1 -

APPENDIX IV	VALUATION REPORT

Contents
STATEMENT . . . . . . . . . . . . . . . . .	. . . . . . . . . .	IV-3
SUMMARY OF THE ASSET VALUATION REPORT .	. . . . . . . . . .	IV-5
ASSET VALUATION REPORT . . . . . . . . . .	. . . . . . . . . .	IV-7

PROFILE OF THE ENTRUSTING PARTY, PROPERTY RIGHT HOLDING ENTITY AND OTHER USERS OF THE VALUATION REPORT . . . . . IV-7

PURPOSE OF VALUATION . . . . . . . . . . . . . . . . . . . IV-12

SUBJECT AND SCOPE OF VALUATION . . . . . . . . . . . . . . IV-12 IV. TYPE OF VALUE AND DEFINITION . . . . . . . . . . . . . . . IV-15

VALUATION REFERENCE DATE . . . . . . . . . . . . . . . . IV-15 VI. BASIS OF VALUATION . . . . . . . . . . . . . . . . . . . . IV-15 VII. VALUATION METHODOLOGIES . . . . . . . . . . . . . . . . . IV-20
VIII. IMPLEMENTATION PROCESS AND SITUATION OF
VALUATION PROCEDURES . . . . . . . . . . . . . . . . . . IV-28 IX. VALUATION ASSUMPTIONS . . . . . . . . . . . . . . . . . . IV-29 X. VALUATION CONCLUSION . . . . . . . . . . . . . . . . . . . IV-30 XI. SPECIAL NOTICES . . . . . . . . . . . . . . . . . . . . . . IV-30
XII. RESTRICTIONS FOR THE USE OF THE VALUATION REPORT . . . . IV-35 XIII. DATE OF THE VALUATION REPORT . . . . . . . . . . . . . . . IV-36

- IV-2 -

APPENDIX IV	VALUATION REPORT

STATEMENT

This asset valuation report was prepared in accordance with the Basic Rules for Asset Appraisal issued by the Ministry of Finance and the Practice Guidelines for Asset Valuation as well as the Code of Ethics for Asset Valuation issued by China Appraisal Society.
The entrusting party or other users of the asset valuation report should use the asset valuation report in accordance with the provisions of laws and administrative regulations and within the scopes as specified in the asset valuation report. We, the asset appraisal institution and its asset appraisers take no responsibility for any non- compliance of above-mentioned requirements for the use of the asset valuation report by the entrusting party or other users of the asset valuation report.
This asset valuation report shall only be used by the entrusting party, other users of the asset valuation report stipulated in the asset valuation engagement contract, and users of the asset valuation report as required by laws and administrative regulations. Save for the above, any other institutions or individuals may not use the asset valuation report.
We, the asset appraisal institution, and its asset appraisers advise that the users of the asset valuation report should correctly interpret the valuation results, which is not equivalent to the realizable value of the subject of valuation and should not be considered as a guarantee for the realizable value of the subject of valuation.
We, the asset appraisal institution, and its asset appraisers comply with the laws, administrative regulations and asset valuation standards, adhere to the principles of independence, objectivity and impartiality, and assume the responsibility for the issued asset valuation report.
The list of assets of the subject of valuation has been reported and confirmed with signatures, seals or other ways as permitted under the laws by the entrusting party and the property holding entity; the entrusting party and other relevant parties are responsible for the truth, completeness and legality of the information provided.
We, the asset appraisal institution, and its asset appraisers have no existing or expected relationship of interests with the subject of valuation in the asset valuation report nor with the relevant parties and have no prejudice against the relevant parties.

- IV-3 -

APPENDIX IV	VALUATION REPORT

The asset appraisers have carried out on-site inspection on the subject of valuation in the asset valuation report and its assets involved; given necessary attention to the legal titles of the subject of valuation and its assets involved, verified the information related to the legal titles of the subject of valuation and its assets involved, made proper disclosure in respect of the identified issues, and requested the entrusting party and other relevant parties to consummate the titles in order to fulfil the requirements for the issuance of an asset valuation report.
The analyses, judgements, and results in the asset valuation report issued by us, the asset appraisal institution are subject to the assumptions and limiting conditions in the asset valuation report. The users of the asset valuation report shall take into full account the assumptions, limiting conditions and special notes specified in the asset valuation report and their impact on the valuation conclusion.

- IV-4 -

APPENDIX IV	VALUATION REPORT

Valuation Project for the Intention of

Hebei Hongsong Wind Power Co., Ltd. in

Understanding the Value of Certain Assets It Held

Summary of Asset Valuation Report

Beijing Zhuoxindahua Appraisal Co., Ltd. was entrusted by Hebei Hongsong Wind Power Co., Ltd. to perform a valuation of certain assets held by Hebei Hongsong Wind Power Co., Ltd. Major information and valuation conclusions in the asset valuation report are hereby extracted as follows.

Economic behavior: Hebei Hongsong Wind Power Co., Ltd. intends to obtain an understanding of the value of certain of its assets.

Purpose of the valuation: to provide a fair presentation of the market value of certain assets held by Hebei Hongsong Wind Power Co., Ltd. on the valuation reference date, and provide opinions of valuation references for the economic behavior.

Subject and scope of valuation: the subject of the valuation is the value of certain assets held by Hebei Hongsong Wind Power Co., Ltd., as designated by the entrusting party; the scope of the valuation covers certain assets held by Hebei Hongsong Wind Power Co., Ltd., as designated by the entrusting party, on the valuation reference date. The aforesaid assets include 2,990 items in total, with a total book value of RMB1,151,717,000, of which 2,985 items are fixed assets with a book value of RMB1,146,071,800 and 5 items are intangible assets with a book value of RMB5,645,200. The specific assets included in the scope of valuation are based on the declared asset valuation list provided by the property right holding entity.

Type of value: the market value of the subject of valuation on continuous use basis at the original premises.

Valuation reference date: 31 October 2019.

Valuation methodology: cost approach.

Valuation conclusion: the asset valuation report adopted the cost approach and arrived

at the valuation conclusion by consolidating all valuation results, that is: the book value of total assets before the valuation was RMB1,151,717,000, and the appraised value amounted to RMB1,644,478,400, representing an appreciation of RMB492,761,400 with an appreciation ratio of 42.78%.

- IV-5 -

APPENDIX IV	VALUATION REPORT

Please refer to the breakdown list of asset valuation and the asset valuation report for the details of valuation conclusion.

The validity of the valuation conclusion: the validity period of this valuation conclusion is one year commencing from the valuation reference date. Assets should be re-valuated if the one-year validity period expires.

Special issues affecting the valuation conclusion: the users of the asset valuation report are advised to pay attention to special issues which could affect the valuation conclusion as described in the valuation report.

The above content is extracted from the full text of the asset valuation report. For the detailed information and reasonable understanding of the valuation results of this valuation, please refer to the full text of asset valuation report.

- IV-6 -

APPENDIX IV	VALUATION REPORT

Valuation Project for the Intention of

Hebei Hongsong Wind Power Co., Ltd. in

Understanding the Value of Certain Assets It Held

Full Text of Asset Valuation Report

Zhuo Xin Da Hua Ping Bao Zi (2019) No. 3010

Hebei Hongsong Wind Power Co., Ltd.,

With the acceptance of the engagement entrusted by the Company, Beijing Zhuoxindahua Appraisal Co., Ltd. has adhered to the principles of independence, objectivity and impartiality in accordance with the relevant laws, administrative regulations and asset valuation standards, adopted the cost approach, and performed valuation on the market value of certain assets held by Hebei Hongsong Wind Power Co., Ltd. pursuant to necessary valuation procedures, for the purpose of the Company's intention to understand the value of certain assets it held as at 31 October 2019. The valuation of the assets is reported as follows.

PROFILE OF THE ENTRUSTING PARTY, PROPERTY RIGHT HOLDING ENTITY AND OTHER USERS OF THE VALUATION REPORT
The entrusting party and property right holding entity of this valuation is Hebei Hongsong Wind Power Co., Ltd. The other users of the asset valuation report are China Ruifeng Renewable Energy Holdings Limited and relevant regulatory authorities.
1. Entrusting party and property right holding entity 1. Basic information

Name:	Hebei Hongsong Wind Power Co., Ltd.
Unified social credit code:	91130000734351037K
Type:	Joint stock company (an unlisted joint
	venture with partners from Taiwan, Hong
	Kong, Macau and China)
Address:	Room 318, Weichang Branch Office
	Tower, Zhuifeng Community (the fifth
	street), Weichang Town, Weichang
	County, Chengde Prefecture-level City,
	Hebei Province*（河北省承德圍場縣圍場
	鎮錐峰社區（五街）圍場分公司辦公樓318
	室)

- IV-7 -

APPENDIX IV	VALUATION REPORT

Business address:	Room 318, Weichang Branch Office
	Tower, Zhuifeng Community (the fifth
	street), Weichang Town, Weichang
	County, Chengde Prefecture-level City,
	Hebei Province*（河北省承德圍場縣圍場
	鎮錐峰社區（五街）圍場分公司辦公樓318
	室)
Legal representative:	Zhang Zhixiang
Registered capital:	RMB910,000,000
Date of establishment:	16 February 2001
Business operation period:	16 February 2001 to non-fixed term
Principal scope of business:	Wind power generation

Hebei Hongsong Wind Power Co., Ltd. (hereinafter referred to as "Hongsong Wind Power") is a joint stock company established by way of promotion by seven entities, including Chengde Electricity Transmission and Distribution Engineering Company*（承德市輸變電工程公司）, Chengde Electricity Development*（承德市電力開發處）, Chengde General Electricity Technology Company*（承德市電力通用技術公司）, Weichang Manchu and Mongol Autonomous County Electricity Power Bureau Electricity Company*（圍場滿族蒙古族自治縣電力局電建公司）, Chengde Electric Power Industry Corporation*（承德電力實業總公司）, Chengde Luandian Electricity Industry Corporation*（承德灤電電力實業總公司）and Hebei Weichang Hongsong Yumu Industry and Commerce Co., Ltd*（河北圍場紅松窪牧工商有限責任公司）.

Upon its promotion, the Company's paid-in capital was RMB32,000,000, total share capital (registered capital) was RMB16,000,000 with each share at the nominal value of RMB1.00, and its capital reserve fund was RMB16,000,000. The shareholding structure of the Company is set out as below:

- IV-8 -

APPENDIX IV		VALUATION REPORT

		Number of	Proportion
		Shares held	of
No.	Name of Shareholder	(Shares)	shareholding
1	Chengde Electricity Transmission	7,600,000	47.50%
	and Distribution Engineering
	Company*（承德市輸變電工程
	公司）
2	Chengde Electricity Development*	2,400,000	15.00%
	（承德市電力開發處）
3	Chengde General Electricity	2,320,000	14.50%
	Technology Company*（承德市電力
	通用技術公司）
4	Weichang Manchu and Mongol	1,600,000	10.00%
	Autonomous County Electricity
	Power Bureau Electricity Company*
	（圍場滿族蒙古族自治縣電力局電建
	公司）
5	Chengde Electric Power Industry	1,395,000	8.72%
	Corporation*（承德電力實業總公
	司）
6	Chengde Luandian Electricity	525,000	3.28%
	Industry Corporation*（承德灤電電
	力實業總公司）
7	Hebei Weichang Hongsong Yumu	160,000	1.00%
	Industry and Commerce Co., Ltd.*
	（河北圍場紅松窪牧工商有限責任公
	司）
	Total	16,000,000	100.00%

After a number of changes in shareholding, the registered capital and of "Hongsong Wind Power" was RMB910,000,000 and its paid-in capital was RMB651,946,500 as at 31 October 2019 (being the valuation reference date). The shareholding structure is set out as below:

- IV-9 -

APPENDIX IV	VALUATION REPORT

		Number of	Proportion
		Shares held	of
No.	Name of Shareholder	(Shares)	shareholding
1	On Win Corporation Limited	430,000,000	47.25%
2	Hebei Hongsong Renewable Energy	319,059,957	35.06%
	Investment Co., Ltd.
3	Chengde Guotou Power	73,326,277	8.06%
	Construction Investment Co., Ltd)*
	（承德市國投電建投資有限責任公
	司）
4	Hebei Weichang Hongsong Yumu	36,419,175	4.00%
	Industry and Commerce Co., Ltd.
5	Chengde Beichen High New	27,727,754	3.05%
	Technology Co., Ltd
6	Chengde Hongsong Renewable	10,778,331	1.18%
	Energy Technology Services Co.,
	Ltd.*（承德紅松新能源技術服務有
	限公司）
7	Weichang Manchu Mongolian	9,602,960	1.06%
	Autonomous County Yongda
	Investment Co., Ltd*（圍場滿族蒙
	古族自治縣湧達投資有限公司）
8	Chengde Shuangyu Shiqiang	3,085,546	0.34%
	Industry and Trade Co., Ltd.*
	（承德雙灤實強工貿有限公司）
	Total	910,000,000	100.00%

Operation and management structure: The Company has established a corporate governance structure for shareholders' meeting, board of directors and board of supervisors; functional management departments including administration and human resources department, finance and assets department, production safety department, investment and development department, board secretariat, department of party affairs and labor union; and Hongsong wind power farm has different production divisions such as operation division, maintenance division, machinery division and general division.

Investee of long-term equity investment: Beijing Hongsong Venture Technology Development Co., Ltd.*（北京紅松創投科技發展有限公司）(hereinafter referred to as "Beijing Hongsong Venture"), which is 100% owned by the Company. Currently, Beijing Hongsong Venture is principally engaged in collection of financial investment projects,

- IV-10 -

APPENDIX IV	VALUATION REPORT

as well as research and development, manufacturing and sales of smart locks. Beijing Hongsong Venture is also the liaison division in Beijing for other investment projects of the Group; Hongsong Hebei Biotech Corporation*（紅松河北生物科技股份有限公司）(hereinafter referred to as "Hebei Biotech"), which is owned as to 40% by the Company, is principally engaged in healthcare and meridian conditioning.

Business of the Company: By leveraging the abundant wind energy resources in Chengde region, "Hongsong Wind Power" began wind testing as early as in 1998. It started the construction of wind farms in 2001 and became the first corporation engaged in wind power generation in Chengde region. With over 10 years of development, "Hongsong Wind Power" owns a self-constructed220-kV transformer substation and four 110-kV transformer substations. The wind farm construction comprised nine phases in total, with 426 power generators installed and total installed capacity of 398,400kW.

1. Relationship between the entrusting party and property holding entity The entrusting party is the property holding entity.
Other users of the asset valuation report
1. Basic information

Name:	C h i n a R u i f e n g R e n e w a b l e E n e r g y
	Holdings Limited
Registration No.:	36684181-000-04-19-8
Legal status:	Body corporate
Address:	Room 1801, 18/F, No.23 Harbour Road,
	Wanchai, Hong Kong
Nature of business:	Investment holding

China Ruifeng Renewable Energy Holdings Limited is a Hong Kong listed company (stock code: 00527) with stock short name of Ruifeng Renew.

- IV-11 -

APPENDIX IV	VALUATION REPORT

2. Relationship with property right holding entity
China Ruifeng Renewable Energy Holdings Limited is a shareholder of On Win Corporation Limited, which is the largest shareholder of the property right holding entity, Hebei Hongsong Wind Power Co., Ltd.
PURPOSE OF VALUATION
As Hebei Hongsong Wind Power Co., Ltd. intends to understand the value of its partial assets, a valuation is needed to provide fair presentation of the market value of the designated partial assets held by Hebei Hongsong Wind Power Co., Ltd. as at the valuation reference date (31 October 2019), and give valuation reference advice for the economic behavior.

SUBJECT AND SCOPE OF VALUATION
The subject of the valuation is the value of certain assets held by Hebei Hongsong Wind Power Co., Ltd., as designated by the entrusting party in respect of this economic behavior.
The scope of the valuation is certain assets held by Hebei Hongsong Wind Power Co., Ltd., as designated by the entrusting party. The asset condition as at the valuation reference date is shown in the following chart:

	Unit of amounts: RMB
Type of assets	Amounts (item)	Book value
Fixed assets	2985	1,146,071,787.57
Which included: Buildings and properties	17	30,393,418.36
Structures	721	60,288,297.45
Machinery and equipment	2247	1,055,390,071.76
Intangible assets	5	5,645,235.77
Which included: Land use right	5	5,645,235.77
Total assets	2990	1,151,717,023.34

- IV-12 -

APPENDIX IV	VALUATION REPORT

The specific assets included in the scope of valuation is based on the declared asset valuation list provided by the property right holding entity.

Legal ownership status, economic status and physical condition of the assets:

1. Buildings and properties

There are 17 items (excluding 1 demolished building) of total 13 buildings, include basically control buildings, general dispatching building, repair workshops and step-up substations with a total gross floor area of 20,753.13 sq.m. Except for the general dispatching building located in Chengde, the rest are located in the wind farms (which are belonged to the property right holding entity) in Weichang County's Hongsongwa National Nature Reserve within close proximity. All the buildings were constructed by phase during 2002 to 2014. The buildings are held for owner occupation, of which part of the general dispatching building was rented out.

Out of the above, building ownership certificates have been obtained for 9 items of buildings and properties with a total gross floor area of 19,533.13 sq.m. The ownership right as set out in the certificate is Hebei Hongsong Wind Power Co., Ltd., and there is no defect in respect of the ownership information.

No building ownership certificate has been obtained for 4 items of buildings and properties with a total gross floor area of 1,220.00 sq.m. The ownership information of these buildings and properties are incomplete. A total of 4 items are classified as improvement expenditures, which require no certificate.

Accounting treatment has not been conducted for 1 item of demolished building and property.

The general dispatching building (which is located in Chengde Hi-tech Park) together with the land on which it is erected has been pledged to Bank of Hebei Co., Ltd. (Chengde Branch) for loans in relation to obtaining working capital.

With on-site inspection, it showed that with the exception of 1 demolished building and property (item), the rest of buildings and properties are under normal use.

- IV-13 -

APPENDIX IV	VALUATION REPORT

Equipment
There are 2,247 items of machinery and equipment in total, mainly including wind power generators, tower structures, pre-assembled transformer substations, electrical and control equipment, communication equipment, auxiliary components and equipment which are held for owner occupation. All of these are located in the wind farms in Weichang Hongsongwa National Nature Reserve. They were purchased or constructed during the period from 2007 to 2018, and all of them are put under normal use.
Intangible assets
There are 5 cases of land use rights with total area of 97,613.86 sq.m., all of which with state-owned land use right certificates obtained. Out of these: 1 case is granted land with an area of 4,788.36 sq.m; 1 case is allocated land with an area of 13,492.00 sq.m; and 3 cases of leasehold lands with total area of 79,333.50 sq.m. Other than the allocated land which have no terms of tenure, the terms of tenure of the remaining land use rights is 40 years. Of these, the land use rights for 4 cases as recorded on certificates belong to Hebei Hongsong Wind Power Co., Ltd. and there is no defect in respect of the ownership information. The land use right for 1 case as recorded on certificate belongs to Hebei Hongsong Electricity Power Co., Ltd while there is defect in respect of the ownership information. The property holding entity have given a full account of the ownership information, and undertook that they have ownership of the land use rights and assume the corresponding legal liabilities in case of ownership dispute of any kind.
The subject and scope of valuation is consistent with those of the economic behavior in respect of which the entrusting party intends to understand the value of the relevant assets.
The book value of the assets, which Hebei Hongsong Wind Power Co., Ltd. intends to understand, as at the valuation reference date has not been audited by certified public accountants in the PRC.
Off-Balance Sheet Assets Reported: No off-balance sheet asset has been reported by the property right holding entity.
Quotation of Reports Prepared by Other Institutions: The valuation does not quote any report prepared by other institutions.

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IV. TYPE OF VALUE AND DEFINITION

In general valuation types for assessing the value of individual assets include market value and non-market value.

For the purpose of this valuation, the type of value of the subject of valuation is the market value on a continuous use basis at the original premises.

Market value refers to the estimated amount for which the subject of valuation is transacted on a normal and fair basis on the valuation reference date between a willing buyer and a willing seller, wherein the parties each acts rationally without being subject to coercion.

VALUATION reference DATE
The valuation reference date of this project was 31 October 2019.
In order to ensure the time effect of the valuation result and to align as close as possible to the date on which the valuation purpose is achieved, we negotiated with the entrusting party based on the nature of the economic behavior of this valuation, and the entrusting party finally determined the valuation reference date to be 31 October 2019.
The valuation reference date is the closing date of a month period during which relevant information and financial data are more comprehensive, resulting in better comparability and is beneficial to the conduct of economic behavior.

Pricing standard adopted in this valuation comprises price, tax rate, rates and interest rate of loans, all of which are effective price standards as at the valuation reference date.

VI. BASIS OF VALUATION

During this valuation, we have complied with the laws and regulations promulgated by the State, local governments and relevant authorities as well as basis of standards, titles and pricing, and made references mainly to the following documents and materials during the valuation:

Basis of Economic Behavior
1. The Asset Valuation Engagement Contract entered into between the entrusting party and Beijing Zhuoxindahua Appraisal Company Limited
（北京卓信大華資產評估有限公司）.

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APPENDIX IV	VALUATION REPORT

Basis of Major Laws and Regulations
1. Asset Appraisal Law of the People's Republic of China;
2. Company Law of the People's Republic of China;
3. Provisional Regulations of the People's Republic of China on Valued- added Tax;
4. Law of the People's Republic of China on Urban Real Estate Management;
5. Land Administration Law of the People's Republic of China;
6. Property Law of the People's Republic of China;
7. Provisional Regulations of the People's Republic of China on the Assignment and Transfer of State-owned Land Use Rights in Urban Areas (Decree No. 55 of the State Council, 19 May 1990);
8. Implementation Rules of the Land Administration Law of the People's Republic of China (Decree No. 256 of the State Council, 1 January 1999);
9. Notice of the Ministry of Land and Resources on Issuing "Land Classification" (Guo Tu Zi Fa (2001) No. 255);
10. Measures for Financial Supervision and Administration in the Asset Appraisal Industry (Decree No. 86 of the Ministry of Finance);
11. Accounting Standards for Business Enterprises - General Standards (Decree No. 33 [2006] of the Ministry of Finance);
12. The 38 specific standards including the Accounting Standards for Business Enterprises 1 - Inventory (Cai Kuai [2006] No. 3);
13. The General Rules Governing Enterprise Financial Affairs (Decree No. 41 [2006] of the Ministry of Finance);
14. Other applicable laws and regulations.

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Basis of Standards
1. The General Standards for Asset Appraisal, No. 43 [2017] of the Ministry of Finance;
2. The Professional Code of Ethics for Assets Appraisal, No. 30 [2017] of the China Appraisal Society;
3. The Practicing Standards for Assets Appraisal - Procedures of Asset Appraisal, No. 36 [2018] of the China Appraisal Society;
4. The Practicing Standards for Assets Appraisal - Asset Appraisal Report, No. 35 [2018] of the China Appraisal Society;
5. The Practicing Standards for Assets Appraisal - Asset Valuation Engagement Contract, No. 33 [2017] of the China Appraisal Society;
6. The Practicing Standards for Assets Appraisal - Asset Appraisal Files, No. 37 [2018] of the China Appraisal Society;
7. The Practicing Standards for Assets Appraisal - Real Estate, No. 38 [2017] of the China Appraisal Society;
8. The Practicing Standards for Assets Appraisal - Machinery and Equipment, No. 39 [2017] of the China Appraisal Society;
9. Guidelines for Business Quality Control of Asset Valuation Institutions, No. 46 [2017] of the China Appraisal Society;
10. Guiding Opinions on the Types of Appraised Asset Value, No. 47 [2017] of the China Appraisal Society;
11. Guiding Opinions on the Legal Titles of the Valuation Subjects for Asset Appraisal, No. 48 [2017] of the China Appraisal Society;

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Basis of Title
1. State-ownedland use right certificates and grant contracts of state- owned construction land use rights;
2. Building ownership certificates;
3. Other ownership documents.
Basis of Pricing
1. The lending rate announced by the People's Bank of China on the valuation reference date;
2. Financial Rules for Capital Construction, Decree No. 81 [2016] of the Ministry of Finance;
3. Notice of the Ministry of Finance on Issuing the Regulations for Management of Construction Costs of Capital Construction Projects (Caijian [2016] No. 504);
4. Regulations for Compilation of and Pricing Standards for Engineering Design Estimates for Onshore Wind Farms of the National Energy Administration (NB/T31011-2011);
5. Estimated Quota of Onshore Wind Farm Projects of the National Energy Administration (NB/T31010-2011);
6. Charging Standards for Engineering Survey and Design of Wind Farms of the National Energy Administration (NBT31007-2011);
7. Notice on the Issues Concerning the Implementation of Transformation and Reform of Value-added Tax in China (Cai Shui [2008] No. 170);
8. Notice on the Pilot Tax Policy in relation to the Imposition of Value- added Tax in lieu of Business Tax in the Transportation Industry and Some Modern Service Industries in China (Cai Shui [2013] No. 37);
9. Notice of the Ministry of Finance and the State Administration of Taxation on Value-added Tax Policies for Wind Power Generation (Cai Shui [2015] No. 74);

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APPENDIX IV	VALUATION REPORT

Implementation Opinions on Adjustment of the Basis of Pricing for Onshore Wind Farm Projects after the Imposition of Value-added Tax in lieu of Business Tax in the Construction Industry (Renewables Quota [2016] No. 32);
Notice on Full Implementation of the Pilot Program in respect of the Imposition of Value-added Tax in lieu of Business Tax (Cai Shui [2016] No. 36);
Notice of the Ministry of Finance and the State Administration of Taxation on the Adjustment of the Value-added Tax Rate (Cai Shui [2018] No. 32);
Circular on the Policies in relation to Deepening Value-added Tax Reform (No. 39 of 2019 of the Ministry of Finance, State Administration of Taxation and General Administration of Customs);
Regulations for Urban Land Valuation (GB/T18508-2014);
Regulations for Gradation and Classification on Urban Land (GB/ T18507-2014);
Properties Valuation Regulations (GB/T50291-2015);
Current Land Use Classification (GBT21010-2007);
Notice of the People's Government of Hebei Province on Revising the Land Expropriation Price (Ji Zheng Fa [2015] No. 28);
Implementation Measures for Farmland Occupation Tax in Hebei Province;
Notice of the People's Government of Chengde City on Issuing the Benchmark Land Price of Cities and Towns under the Jurisdiction of Chengde City (Cheng Shi Zheng Zi [2019] No. 28);
2019 Mechanical and Electrical Products Quotation Manual;
The information on geographical conditions of the area where the property valued is located;

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1. Engineering contracting contracts and equipment purchase contracts entered into between the company and relevant entities;
2. Other materials such as contracts in relation to the acquisition and use of assets by the company and accounting documents.
Other Basis for References
1. The asset valuation declaration list provided by the property holding entity;
2. The on-site survey questionnaires provided and other data collected by professional asset appraisers;
3. The latest version of Handbook of Data and Parameters Commonly Used in Asset Valuation;
4. Other valuation-related information.

VII. VALUATION METHODOLOGIES

Analysis of Applicability of Valuation Methodologies
Professional asset appraisers shall perform the valuation work on an individual asset based on factors such as valuation purposes, subject of valuation, value types and data collection, and analyze the applicability of the three basic asset valuation methodologies, i.e. income approach, market approach and cost approach, in order to make a proper choice of valuation methodologies.
The income approach is a collective term of valuation methods to determine the value of the asset being appraised by estimating the present value of future expected income of the asset.
The market approach is a collective term of valuation methods to estimate the value of assets by directly comparing with the recent transaction prices of the identical or similar assets in the market or by analyzing comparable assets in the market.
The cost approach is a collective term of valuation methods to determine the value of the assets appraised by estimating the replacement cost of the asset appraised and then forecasting and deducting the depreciation items existing in the asset appraised from the replacement cost.
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Included in the valuation scope, the buildings are constructed by the Company, while the machinery and equipment are part of the assets purchased externally. Therefore, it is not possible to obtain income related to similar buildings and equipment, and future profits cannot be reasonably predicted. In view of this, the income method is not applicable for this valuation;

Due to the limited access to transaction information in the domestic trading market, as well as the lack of comparable assets identical or similar to the assets being appraised in the current market and the lack of or the difficulty in obtaining transaction cases for the assets similar to the subject of valuation, it is not appropriate to use the market approach to value the assets in this project.

Since the valuation results of the cost approach are mainly determined based on the replacement cost of the assets as at the valuation reference date, which is highly reliable, and it is not difficult to identify and appraise the assets in this valuation, the cost method is appropriate for this asset valuation.

Technical Conception and Models of Cost Approach
The cost approach is a technical conception of valuation to determine the value of the subject of valuation by adding up the appraised values of the underlying assets consisting of the subject of valuation as determined using specific valuation methods, if applicable, according to the circumstances, in order to determine the value of the assets as a whole within this valuation scope on the basis of the amount of investment required to re-build an asset that is same as the assets of the subject of valuation as at the valuation reference date.
Valuation Process
1. Fixed assets
  The assets include buildings, plant and equipment. This valuation adopts the cost approach based on the results of on-site survey of fixed assets, by conscientiously sorting up, analyzing and calculating the collected data. The appraised value includes tax.
  The value-added tax rates applicable in the valuation of fixed assets as at the valuation reference date are 9%, 13% and 6% for properties and buildings, plant and equipment and taxable preliminary and other expenses, respectively.

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APPENDIX IV	VALUATION REPORT

The cost approach is a collective term of valuation methods to determine the value of the assets appraised by estimating the replacement cost of the asset appraised and then forecasting and deducting the depreciation items existing in the asset appraised from the replacement cost.

Appraised value = replacement cost × overall newness rate

Buildings
a. Determination of Replacement Cost

The appraiser analyzes the buildings and calculates the volume of engineering work of the sub-projects according to the construction drawings and site survey and measurement of the buildings in view of the actual situation. The documents will be revised according to the budget quota, cost quota and materials price difference of construction projects. The budgetary estimate and final budget adjustment method is used to calculate the construction cost of typical buildings, adding up the cost required to be incurred by the use of equipment, materials and funds during the construction. The total construction cost of typical buildings is calculated and determined in accordance with the charging standards for construction of buildings in the industry of the assets being appraised and issued by the governmental authorities, to compare and determine the influence coefficient of the differences of other buildings on the total construction cost by comparing with similar assets, through which the total construction cost of other buildings is arrived at, so as to determine the replacement cost taking into account other construction costs and capital cost.

Replacement cost = (total construction and installation cost including tax + preliminary and other cost + capital cost)

Determination of Newness Rate

The overall newness rate is determined based on the results of site survey according to the specific conditions of buildings and structures, adding up the weighted averages in

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different weights calculated using the lifetime method and the complete score method.

Lifetime newness rate = remaining useful life ÷ (serviced life + remaining useful life) × 100% or:

Lifetime newness rate = (economic service life - serviced life)/economic service life × 100%

The remaining useful life is determined in accordance with the government regulations taking into account the form and completion time of the main structure of buildings. The economic service life is determined in accordance with the Handbook of Data and Parameters Commonly Used in Asset Valuation.

Complete score newness rate = newness rate of structures

G + newness rate of decoration × S + newness rate of equipment × B

Overall newness rate = lifetime newness rate×40%+ complete score newness rate × 60%.

Machinery and Equipment
a. Determination of Replacement Cost

For a typical complete set of machinery and equipment, the replacement cost is arrived at by determining the purchase price through the market approach, plus the transportation and miscellaneous expense, installation and commissioning expense and ancillary fixture expense, if necessary, to be incurred to make the equipment ready for use, taking into account the preliminary and other costs and capital cost of the construction based on the current pricing standards in the market of the region where the assets being appraised locate, and in accordance with the national applicable taxation policies.

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For self-made and non-standard equipment, the replacement cost is arrived at by investigating the current cost (including tax) of various non-standard equipment through the cost approach, and checking the material quality and use level of the equipment, taking into account the preliminary and other costs and capital cost of the construction based on the current pricing standards in the market of the region where the assets being appraised locate.

Replacement cost of equipment = purchase price including tax × (1+ transportation and miscellaneous expense + installation and commissioning expense) × (1+ preliminary and other costs) × (1+ capital cost)

Determination of Newness Rate

The newness rate of main equipment is determined as follows:

Lifetime newness rate = (economic service life - serviced life)/economic service life × 100%

Survey newness rate = ∑ technical observation and analysis score x weight of score of each constituent unit x 100%

Overall newness rate = lifetime newness rate×40%+ survey newness rate × 60%

The newness rate of general or low-value machinery and equipment is determined as follows:

Newness rate = remaining useful life/economic serviced life × 100%

For equipment that is no longer sold in the current market, the appraised value is determined by using the market approach based on second-hand price, including tax, of the same type of the equipment in the market.

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APPENDIX IV	VALUATION REPORT

Intangible Assets
The assets include the land use right of 5 parcels of land with an area of 97,613.86 sq.m.
According to the valuation standards for real estate and taking into account the valuation purpose, the characteristics of the subject of valuation, value types and data collection and other relevant conditions, the appraiser will analyze the availabilities of the three basic asset valuation methodologies, i.e. market approach, income approach and cost approach, as well as the availabilities of derived methods such as cost approach method, benchmark land price revision method and hypothetical development method.
Since there is no similar market transaction case recently in the region where the subject of valuation is located, it is not appropriate to use the market comparison method. As there are limited cases of solely leasing land in the region where the subject of valuation locates, and the land revenue cannot be separated from the whole rental income of the properties, it is not appropriate to use the income approach.
The buildings on the lands of the subject of valuation are real properties for the purpose of production use. As there are limited property transactions of similar types in the region, and the total property price at the time of development completion cannot be reasonably determined, it is not appropriate to use the residual value approach (hypothetical development method).
The land of the subject of valuation in Weichang County can be appraised using the cost approach method, as there are recent cases of land requisition in the region where the land to be appraised is located, and the local government and relevant authorities have published documents in relation to the compensation standards for land requisition with clear cost composition and sufficient basis of pricing. For the land in Chengde Development Zone which has been developed, as there are no recent cases of compensation for demolition, the cost approach method is not applicable as the compensation standards are uncertain.

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APPENDIX IV	VALUATION REPORT

Since the land of the subject of valuation in Weichang County is beyond the coverage of local benchmark land price, it is not appropriate to use the benchmark land price coefficient revision method. For the land located in Chengde Development Zone, as it is covered by the benchmark land price in Chengde, and the local government has published new benchmark land price standards in 2019, it is appropriate to use the benchmark land price coefficient revision method.

Therefore, after site investigation and thorough analysis, and according to the information provided by and the market data on land premium as is known to the property holding entity, the valuation adopts the cost approach method for the allocated land in Weichang County and the benchmark land price coefficient revision method for the land located in Chengde Development Zone, taking into account the location, nature of land and use conditions of the land being appraised and local land market conditions. For the leased land in Weichang County, the value of land use right is determined as revised for the remaining useful life according to the standards of leased land as at the valuation reference date as advised by the local land authorities.

Cost approach method:
The cost approach method is a valuation method to determine land prices based on the sum of all expenses incurred by land development, plus some profit and interest, taxes paid and land ownership income. The formula is as follows:
Land price = cost of land acquisition + cost of land development + taxes + interest + profit + land ownership income
This is the price for a land with an infinite life, which is required to be adjusted to a finite life. The life revision coefficient formula is as follows:

k = 1 -

Where:

(1 + r) m

- Life revision coefficient r - Land rehabilitation rate
m - Remaining useful life of land

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APPENDIX IV	VALUATION REPORT

For the allocated land parcels, no allowance is required for land appreciation income. Since the subject land parcel is solely for the use of wind power equipment with a huge area and special shape, no revision shall be performed in respect of individual factors. As allocated lands are not subject to useful life, no allowance is made for life revision.

Benchmark land price coefficient revision method:
The benchmark land price coefficient revision method is a method of estimating the objective price of the subject land parcel by revising the benchmark price of the land for the same purpose at the same level or in the same area published by each city and town through analyzing the factors which will influence the price of the subject land parcel and utilizing the land price revision coefficient. The formula is as follows:
P = P1b × (1 ± ∑Ki) × Kj + D

Where:
P	-	Price of subject land parcel;
P1b	-	Benchmark land price for a particular purpose at a
		particular level (homogeneous region);
∑Ki	-	Land price revision coefficient;
Kj	-	Other revision coefficients including duration of
		valuation, plot ratio and land useful life;

1. - Land development level revision value.
Determination of Valuation Conclusion
Based on the above valuation conception, we sum the valuation results in respect of the designated assets of Hebei Hongsong Wind Power Co., Ltd. using the cost approach.

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APPENDIX IV	VALUATION REPORT

VIII. IMPLEMENTATION PROCESS AND SITUATION OF VALUATION PROCEDURES

For the purpose of understanding the value of certain assets, the entrusting party determined to engage our company to appraise the value of certain designated assets of Hebei Hongsong Wind Power Co., Ltd. after contacting us. Upon our acceptance of the valuation engagement, we determine the purpose of valuation and the value type of the subject of valuation according to the characteristics of the economic behavior underlying this valuation project. We had a preliminary understanding of the details of the subject and the scope of valuation, and determined the valuation reference date, prepared a valuation proposal and entered into a valuation engagement contract after negotiations with the entrusting party.
In accordance with the Assets Valuation Standards - Valuation Procedures, we provided the property holding entity with the information required for asset valuation, and helped the property holding entity in inspecting their assets, forecasting company profit and completing relevant forms. After the completion of such preliminary work, the professional asset appraisers were arranged to commence a site survey on 8 to 9 November 2019 by Mr. Jie Yan Ping, an asset appraiser, and conduct investigations, if necessary, through inquiries, verifications, surveys, inspections and etc. to understand the conditions of economic and technical use as well as legal ownership of assets; analyze the circumstances of the subject of valuation; collect the financial data of the company recently and as at the valuation reference date; check whether the valuation information submitted by the company is consistent with the accounting information provided; verify the truthfulness and completeness of the information obtained; and pay necessary attention to the legal ownership of the assets.
In accordance with the laws, standards and pricing basis in relation to the valuation, we adopted appropriate valuation methods on a case-by-case basis, and collected and used market price information as the basis for pricing, in order to determine the appraised value by using the verified book value.
We summarized the valuation results, analyzed the valuation conclusions, prepared a valuation report, implemented an internal three-level audit and submitted the valuation report.

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APPENDIX IV	VALUATION REPORT

IX. VALUATION ASSUMPTIONS

The valuation conclusion of the subject is made on the premise that the following assumptions and restrictions are found, and if such assumptions and restrictions cannot be met in a reasonable way, the valuation conclusion of this report normally tends to change to different extents.

It is assumed that the assets within the scope of valuation will continue to be used as they have been at the same premises subsequent to the valuation reference date.
It is assumed that both parties of the assets transaction or the proposed assets transaction in the market are in equal position and have opportunities and time to obtain sufficient market information, so as to make rational judgments on the transaction value of the subject of valuation.
There have been no significant changes in the existing relevant laws and regulations and policies and in the macroeconomic landscape in the PRC, as well as in the political, economic and social environment in the region where the parties of the transaction are located.
It is assumed that the company's operators are responsible and that the management of the company is capable of performing its duties.
It is assumed that the company maintains the existing management style and level, business scope and mode.
It is assumed that the company fully complies with all applicable laws and regulations unless otherwise stated.
It is assumed that the accountings policies to be adopted by the company in future are consistent with the accountings policies adopted in the preparation of this report in material aspects.
There have been no major changes in the interest rates, tax bases and rates and policy levies.
It is assumed that the purchase, acquisition and construction of the subject assets of valuation comply with the relevant laws and regulations in China.
There is no force majeure event and unforeseeable factors that may have material adverse impact on the company.
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APPENDIX IV	VALUATION REPORT

VALUATION CONCLUSION
After applying various valuation methods and procedures as mentioned above, the following valuation conclusions have been made with respect to the market value of certain assets held by "Hongsong Wind Power" as at 31 October 2019, as requested by the entrusting party with an intention to understand the value of certain assets of Hebei Hongsong Wind Power Co., Ltd.:
The total book value of the assets before the valuation was RMB1,151,717,000 and the appraised value of the assets amounted to RMB1,644,478,400, representing an appreciation of RMB492,761,400 and an appreciation rate of 42.78%. Of which: the book value of the fixed assets was RMB1,146,071,800 and the appraised value amounted to RMB1,635,991,400, representing an appreciation of RMB489,919,600 and an appreciation rate of 42.75%; the book value of the intangible assets was RMB5,645,200 and the appraised value amounted to RMB8,487,100, representing an appreciation of RMB2,841,800 and an appreciation rate of 50.34%.

For the details of the valuation results, please refer to the breakdown list of asset valuation.

XI. SPECIAL NOTICES

1. On 29 November 2017, Hebei Hongsong Wind Power Co., Ltd. and Jiyin Financial Leasing Company Limited entered into a finance lease agreement, where Jiyin Financial Leasing Company Limited paid the consideration for the purchase of the wind power equipment assets of Hongsong Wind Power Phase 7 (Hebei Yunfeng wind power farm) of RMB102,200,000 to Hebei Hongsong Wind Power Co., Ltd., while Jiyin Financial Leasing Company Limited leased the asset to Hebei Hongsong Wind Power Co., Ltd. for a lease period of 73 months and paid in 73 installments commencing from the next month after start date, and the payment date of the rent was the fifteenth day of each month, where the rent was calculated with reference to the leasing cost per installment of RMB1,400,000 and the current actual lending interest rate. Hebei Hongsong Wind Power Co., Ltd. provided Hongsong Wind Power Phase 7 (Hebei Yunfeng wind farm) as property charge, the right on the electricity bills and other subsidies from Hongsong Phase 7 wind power energy project as charge guarantee for the right on the receivables incurred from 29 November 2017 to 15 December 2023, and Zhang Zhixiang and his spouse Mei Yuan and Chengde Beichen High New Technology Co., Ltd provided a joint-liability

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APPENDIX IV	VALUATION REPORT

guarantee. The start date was the day Jiyin Financial Leasing Company Limited paid the consideration for the purchase of the leased asset pursuant to the finance lease agreement, and upon the expiration of the agreed lease period and the fulfillment of all the obligations of the agreement by Hebei Hongsong Wind Power Co., Ltd., the leased asset will automatically belong to Hebei Hongsong Wind Power Co., Ltd..

On 4 September 2018, Hebei Hongsong Wind Power Co., Ltd. and Jiyin Financial Leasing Company Limited entered into a finance lease agreement, where Jiyin Financial Leasing Company Limited paid the purchase consideration of the wind power equipment assets of Hongsong Wind Power Phase 6 (Hebei Peifeng wind farm) of RMB120,000,000 to Hebei Hongsong Wind Power Co., Ltd., while Jiyin Financial Leasing Company Limited leased the asset to Hebei Hongsong Wind Power Co., Ltd. for a lease period of 36 months and paid in 36 installments commencing from the next month after start date, and the payment date of the rent was the fifteenth day of each month, where the rent was calculated with reference to the leasing cost per installment of RMB2,000,000 and the current actual lending interest rate. Hebei Hongsong Wind Power Co., Ltd. provided Hongsong Wind Power Phase 6 (Hebei Peifeng wind power farm) as property charge, the right on the electricity bills and other subsidies from Hongsong Wind Power Phase 6 wind power energy project as charge guarantee on the receivables, the right on the electricity bills from Hongsong Wind Power Phase 2 wind power energy project as charge guarantee on the receivables, and Zhang Zhixiang and his spouse Mei Yuan and Chengde Beichen High New Technology Co., Ltd provided a joint-liability guarantee. The start date was the day Jiyin Financial Leasing Company Limited paid the consideration for the leased asset pursuant to the finance lease agreement, and upon the expiration of the agreed lease period and the fulfillment of all the obligations of the agreement by Hebei Hongsong Wind Power Co., Ltd., the leased asset will automatically belong to Hebei Hongsong Wind Power Co., Ltd..
Pursuant to the maximum mortgage agreement (DY160801000703) between Hebei Hongsong Wind Power Co., Ltd. and Bank of Hebei Co., Ltd. Chengde Branch, Hebei Hongsong Wind Power Co., Ltd. pledged the office building of Hongsong Wind Power at Chengde Development Zone to Bank of Hebei Co., Ltd. Chengde Branch. The pledge amount was Renminbi forty million only and the pledge period was from 1 August 2016 to 1 August 2019.

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APPENDIX IV	VALUATION REPORT

Pursuant to the fixed assets loan agreement between Hebei Hongsong Wind Power Co., Ltd. and Industrial and Commercial Bank of China Limited Chengde Taipingqiao Sub-branch(04110015-2013 (Tai Zhi) Zi No. 0026), an amount of Renminbi two hundred ninety seven million was borrowed and it was agreed that Hebei Hongsong Wind Power Co., Ltd. shall pledge all receivables and interests under the right on the electricity bills of the Phase 9 Yuanhui 49.5MW wind farm, if completed, to the ICBC for obtaining loans, and all income from electricity bills (including national subsidy) belongs to ICBC.
Pursuant to the mortgage agreement (2014 Che Zhi Di Ya No. 006), equity pledge agreement (2012 Che Zhi Zhi Ya No. 01) between Hebei Hongsong Wind Power Co., Ltd. and China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch, Hebei Hongsong Wind Power Co., Ltd. pledged the "Hongsong Wind Power Phase 8 Shanyuan wind power farm" to China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch and the collection right on the electricity bills was provided as charge guarantee. The pledge amount was Renminbi three hundred and two million three hundred sixty thousand, the charge amount was Renminbi four hundred sixty seven million nine hundred thirty thousand, and the pledge period was from October 2012 to December 2021.
Pursuant to the mortgage agreement (2009 Che Zhi Di Ya No. 001) between Hebei Hongsong Wind Power Co., Ltd. and China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch, Hebei Hongsong Wind Power Co., Ltd. pledged the "Hongsong Wind Power Phase 3 Songshan wind farm" to China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch. The pledge amount was Renminbi two hundred forty three million two hundred seventy thousand and the pledge period was from 28 August 2006 to 27 August 2019.
Pursuant to the mortgage agreement (2009 Che Zhi Di Ya No. 002) between Hebei Hongsong Wind Power Co., Ltd. and China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch, Hebei Hongsong Wind Power Co., Ltd. pledged the "Hongsong Wind Power Phase 4 Huifeng wind farm" to China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch and the collection right on the electricity bills was provided as charge guarantee. The pledge amount was Renminbi three hundred and two million seven hundred seventy thousand and the pledge period was from 27 August 2007 to 26 November 2021.

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APPENDIX IV	VALUATION REPORT

Pursuant to the mortgage agreement (2012 Che Zhi Di Ya No. 001) between Hebei Hongsong Wind Power Co., Ltd. and China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch, Hebei Hongsong Wind Power Co., Ltd. pledged the "Hongsong Wind Power Phase 5 Zefeng wind farm" to China Construction Bank Corporation Chengde Che Zhan Lu Sub-branch. The pledge amount was Renminbi four hundred eighty five million eight hundred ninety thousand and the pledge period was from 3 February 2008 to 2 March 2022.
Pursuant to the maximum mortgage agreement (13080901-2010 Cheng Wei Di Zi No. 0009) between Hebei Hongsong Wind Power Co., Ltd. and Agricultural Development Bank of China Weichang Manchu and Mongol Autonomous County Sub-branch, Hebei Hongsong Wind Power Co., Ltd. pledged the "Hongsong Wind Power Phase 7 Yunfeng wind farm" to Agricultural Development Bank of China Weichang Manchu and Mongol Autonomous County Sub-branch. The pledge amount was Renminbi two hundred million only and the pledge period was from 26 May 2010 to 31 December 2020.
Pursuant to the finance lease agreements (Jiyin 2018 Hui Zi No. 0048 - Di No. 01), (Jiyin 2017 Hui Zi No. 0082 - Di No. 02) between Hebei Hongsong Wind Power Co., Ltd. and Jiyin Financial Leasing Company Limited, Hebei Hongsong Wind Power Co., Ltd. pledged the" Phase 6 Peifeng wind farm" and "Phase 7 Yunfeng wind farm" to Jiyin Financial Leasing Company Limited. The right on the electricity bills and other subsidies from Hongsong Wind Power Phase 6 and Phase 7 was provided as charge guarantee on the receivables and the right on the electricity bills and other collection rights of Hongsong Wind Power Phase 2 were provided as charge guarantee on the receivables. The pledge period were 36 months and 73 months respectively.
This valuation has not taken into account the impact of potential contingent liabilities for the above matters on the valuation conclusion.
There are 17 items (excluding 1 item of demolished building) of total 13 buildings with a gross floor area of 20,753.13 sq.m. No building ownership certificate has been obtained for 4 items of buildings with a gross floor area of 1,220.00 sq.m. That ownership information of these properties are incomplete. The property holding entity has provided the relevant building information, construction contracts, invoices and payment certificates, giving a full account of the ownership information, and undertook that they have ownership of such buildings and properties and assume the corresponding legal liabilities in case of ownership dispute of any kind. The gross floor areas of the buildings

- IV-33 -

APPENDIX IV	VALUATION REPORT

without building ownership certificates are mainly confirmed by on-site measurements, consultation of drawings and information on the completion of works. If the areas stated in the future building ownership certificates of the above buildings and properties are inconsistent with the ones in this report, the areas as measured by the regulatory bodies shall prevail and the assessed value shall be adjusted accordingly. This valuation is made on the basis of the assumptions of complete ownership information and clear titles, and has not taken into account the impact of the subsequent license fees and potential contingent liabilities for the above matters on the valuation conclusion.

A total of 5 land parcels with an area of 97,613.86 sq.m. have obtained state- owned land use rights certificates. There is 1 parcel with certificate stating that the right of use belongs to Hebei Hongsong Electricity Power Co., Ltd. while there is defect in respect of its ownership information. The property holding entity has given a full account of the ownership information, undertaking that it has ownership of the land use rights and will assume the corresponding legal liabilities in case of ownership dispute of any kind.
The book value of the assets of Hebei Hongsong Wind Power Co., Ltd. as at the valuation reference date has not been audited by a certified public accountant.
Due to the restraints of objective circumstances, the piping, concealed works and electric wirings to be valued were not explored or measured on-site. This valuation has relied on the data reported by the property holding entity and certain project settlement information, construction agreement and proof of payment as the alternative procedure.
The valuation institute and the professional asset appraisers assume no responsibility for any other defects which may have an influence on the valuation conclusion, in the case where no special direction has been given by the entrusting party and the property holding entity, which the professional asset appraisers was unable to acquire after conducting due valuation procedures.
This valuation conclusion does not take into account those matters that may affect the valuation conclusion, such as pledge and guarantee that may be undertaken in the future, and increase or decrease in the price paid by special transaction parties, nor has it taken into account the impact of change in national macroeconomic policy as well as natural force and other force

- IV-34 -

APPENDIX IV	VALUATION REPORT

majeure on the value of the subject of valuation. In the event of any change of the aforesaid conditions as well as other assumptions and pre-conditions of the going concern principle as abided during the appraisal, the valuation conclusion will, in general, becomes invalid and the users of the report should not use this valuation report, or they shall bear all the consequences arising therefrom.

During the period from the valuation reference date to the date of this valuation report, the entrusting party and property right holding entity did not report any subsequent event that would have significant impact, nor was the professional asset appraisers able to discover any subsequent event that would have a significant impact.
In the event of any material change in the quantity of assets between the date of valuation report and the validity period of the valuation report, the assets amount should be adjusted accordingly. In the event that there are changes in the pricing standard of assets that have an obvious impact on the asset valuation conclusion, a revaluation should be conducted.

For the treatment of the above special issues and the possible impact of these special issues on the valuation conclusion, the users of the valuation report are advised to pay attention to the impact on the economic behavior.

XII. RESTRICTIONS FOR THE USE OF THE VALUATION REPORT

The asset valuation report shall only be used for the purpose and application as specified in the report.
The asset valuation report shall be only used by the users as specified in the asset valuation report, unless otherwise required by the laws and regulations of the PRC. If the entrusting party or other asset valuation report users fail to use it in accordance with the scope of use specified in the laws, administrative regulations and asset valuation report, the asset valuation agency and its assets appraisers shall not be liable. Except for the entrusting party, other asset valuation report users as specified in the asset valuation engagement contract and the asset valuation report users as stipulated in the laws and administrative regulations, other entities or individuals shall not become the users of the asset valuation report.

- IV-35 -

APPENDIX IV	VALUATION REPORT

The users of the asset valuation report should correctly understand the valuation conclusions. The valuation conclusions are not equivalent to the realizable value of the subject of valuation, and its conclusion should not be considered as a guarantee of the realizable value of the subject of valuation.
The asset valuation report shall only be used officially after obtaining prior approval from the relevant competent authorities if the valuation report is required to be submitted for review by or filed with the competent authorities in accordance with the current statutory requirements of the PRC.
Unless otherwise provided by the laws and regulations and agreed by relevant parties, the contents of the asset valuation report shall not be extracted, referenced to or disclosed to public media without the consent from the asset valuation institute.
The asset valuation report can be used for a validity period of one year as stated herein, commencing from 31 October 2019, the valuation reference date, to 30 October 2020, after which and the valuation report shall not be used.
The right to construe the asset valuation report shall be vested in the valuation institution of this project only, unless otherwise required by the laws and regulations of the PRC.

XIII. DATE OF THE VALUATION REPORT

29 November 2019.

- IV-36 -

APPENDIX IV	VALUATION REPORT

(No text on this page)

Asset Appraiser: Jie Yan Ping

Asset Appraiser: Sun Lin

Beijing Zhuoxindahua Appraisal Co., Ltd.

29 November 2019

- IV-37 -

APPENDIX IV	VALUATION REPORT

Certificate of Professional Asset Appraiser

Registration Card

(Personnel of APPRAISAL INSTITUTION)

Name:	Jie Yan Ping（解彥平）
Gender:	Male
Registration number:	11001103
Name of company:	Beijing Zhuoxindahua Appraisal Co., Ltd.
Date of initial	31 December 1998
registration:
Information of annual	Pass (7 August 2019)

review:

Industry Association: China Appraisal Society

Personnel's Signature:

Personnel's Seal:

China Appraisal Society

Printing date: 8 August 2019

The information of the asset appraiser is based on the results shown on the official website

of China Appraisal Society

Official website for enquiry: http://cx.cas.org.cn

- IV-38 -

APPENDIX IV	VALUATION REPORT

Certificate of Professional Asset Appraiser

Registration Card

(Personnel of APPRAISAL INSTITUTION)

Name:	Sun Lin（孫林）
Gender:	Male
Registration number:	51100042
Name of company:	Beijing Zhuoxindahua Appraisal Co., Ltd.
Date of initial	15 December 2010
registration:
Information of annual	Pass (7 August 2019)

review:

Industry Association: China Appraisal Society

Personnel's Signature:

Personnel's Seal:

China Appraisal Society

Printing date: 8 August 2019

The information of the asset appraiser is based on the results shown on the official website

of China Appraisal Society

Official website for enquiry: http://cx.cas.org.cn

- IV-39 -

APPENDIX IV	VALUATION REPORT

BEIJING ZHUOXINDAHUA Appraisal Co., Ltd.

Address: 12/F, Building No. 7, No. 16 Yuan, Xisihuanzhonglu, Haidian District, Beijing

Postal code: 100039

Telephone no.: (010) 58350539

58350462

58350098

Fax: (010) 58350099

- IV-40 -

APPENDIX V	GENERAL INFORMATION

RESPONSIBILITY STATEMENT
This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.
DIRECTORS' INTERESTS
As at the Latest Practicable Date, the interests and short positions of the Directors and the chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to the provisions of Divisions 7 and 8 of Part XV of the SFO (including interests and short positions in which he was deemed or taken to have under such provisions of the SFO), or which were required, pursuant to section 352 of the SFO, to be entered in the register maintained by the Company referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers in Appendix 10 to the Listing Rules, to be notified to the Company and the Stock Exchange were as follows:

	Number of		Approximate
Name of	Shares held/		percentage of
Director	interested	Nature/capacity	shareholding
Mr. Zhang	495,174,325	Interest of controlled	27.52%
		corporation (L) (Note)

Note:

Mr. Zhang is the beneficial owner of the entire issued shares of Diamond Era Holdings Limited ("Diamond Era") which was interested in 495,174,325 Shares. As at the Latest Practicable Date, 308,867,000 Shares held by Diamond Era were pledged to a commercial bank in relation to a borrowing by the bank to the Group. Mr. Zhang is deemed, or taken to be, interested in the Shares in which Diamond Era is interested for the purpose of the SFO.

- V-1 -

APPENDIX V	GENERAL INFORMATION

Save as disclosed above, so far as is known to the Directors and the chief executive of the Company, as at the Latest Practicable Date, no other person (other than a Director or chief executive of the Company) had, or was deemed or taken to have, an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or held any option in respect of such capital. As at the Latest Practicable Date, none of the Directors is a director or employee of a company which had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

DIRECTORS' SERVICE CONTRACTS
As at the Latest Practicable Date, none of the Directors had entered, or proposed to enter into, a service contract with the Company or any member of the Group which does not expire or is not determinable by the Company or such member of the Group within one year without payment of compensation, other than statutory compensation.
COMPETING INTERESTS
As at the Latest Practicable Date, none of the Directors and their respective close associate(s) was interested in any business apart from the business of the Group, which competes or is likely to compete, either directly or indirectly, with the business of the Group.

5. D I R E C T O R S ' I N T E R E S T I N A S S E T S O R C O N T R A C T S O R ARRANGEMENTS

As at the Latest Practicable Date, (i) none of the Directors nor their respective close associate(s) had any direct or indirect interest in any assets which had been, since 31 December 2018 (being the date of which the latest published audited consolidated financial statements of the Group were made up), acquired, disposed of by, or leased to any member of the Group, or were proposed to be acquired, disposed of by, or leased to any member of the Group; and (ii) none of the Directors was materially interested in any contract or arrangement which was significant in relation to the business of the Group.

- V-2 -

APPENDIX V	GENERAL INFORMATION

6. MATERIAL CONTRACTS

As at the Latest Practicable Date, the following contracts (not being contracts entered into in the ordinary course of business of the Group) were entered into by members of the Group within the two years immediately preceding the date of this circular and are, or may be, material:

the placing agreement dated 4 December 2019 and supplemental agreement dated 10 December 2019 entered into between the Company and a placing agent in respect of a placing of 180,000,000 placing shares at the placing price of HK$0.25 per placing share on a best effort basis;
the Sale and Leaseback Agreements;
the agreement dated 18 September 2019 and the side letter dated 30 September 2019 entered into between Leading Win Resources Limited, a direct wholly- owned subsidiary of the Company as vendor and Beijing Enterprises City Development (Hong Kong) Limited as purchaser relating to the proposed disposal of Team Mega Limited ("Team Mega"), an indirect wholly-owned subsidiary of the Company;
the Second Amendment Deed dated 22 August 2019 entered into among the Company and all the noteholders of the Convertible Notes to further extend the maturity date, amend the interest rate and require the Company to pay on the date of the Second Amendment Deed interest accrued and to be accrued from (and including) 15 June 2019 to (but excluding) 15 December 2019;
the agreement dated 17 June 2019 entered into among Team Mega, Beijing Enterprises City Development Company Limited*（北控城市開發有限公司）, Laizhou City Investment Development Company Limited*（萊州市城市投資發展有限公司）and Laizhou Chengkai Investment Comapny Limited*（萊州城開投資有限公司）in relation to the formation of the joint venture company proposed to be established in the PRC and named as Beikong Stone Laizhou Co., Ltd.*（北控石業（萊州）有限公司）;
the sale and purchase agreement dated 3 May 2019 entered into between On Win Corporation Limited (as seller) and Candice Group (as purchaser) on the disposal of approximately 12.5% of the issued share capital of the purchaser;
the subscription agreement in respect of the Convertible Bonds dated 31 December 2018;

- V-3 -

APPENDIX V	GENERAL INFORMATION

1. the share purchase agreement dated 7 November 2018 entered into among the Company, Longe International Investment Limited (as purchaser), Suzlon Tianjin (as warrantor) and LongiTech Smart Energy Holding Limited on the disposal of the entire issued share capital of Sino Renewable Energy Holdings Company Limited, a wholly-owned subsidiary of the Company;
2. the finance lease agreements dated 11 September 2018 entered into among Hongsong (as seller/lessee) and Jiyin Leasing (as purchaser/lessor) in relation to the finance leasing and purchase of the wind power generators and the ancillaries of the phase 6 of a wind power energy project undertaken at the Hebei Pui Feng wind power farm*（河北沛楓風電場）;
3. the placing agreement of the Convertible Notes 2 dated 24 April 2018; and
4. the equipment purchase agreements and the finance lease agreement dated 7 February 2018 entered into between Baotou Yinfeng, Hengqin FI, Tianshun and Suzlon Tianjin in relation to certain machinery and equipment for the construction project of a wind farm in the PRC.
LITIGATION
As at the Latest Practicable Date, so far as the Directors were aware, no litigation or claim of material importance was pending or threatened against any member of the Group.
EXPERTs AND CONSENTs
The following are the qualifications of the experts who have given opinions or advice contained in this circular:

Name	Qualifications
ZHONGHUI ANDA CPA Limited	Certified Public Accountants
Beijing Zhuoxindahua Appraisal	Valuer
Co., Ltd.

As at the Latest Practicable Date, the experts did not have any shareholding, directly or indirectly, in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

- V-4 -

APPENDIX V	GENERAL INFORMATION

As at the Latest Practicable Date, the experts did not have any direct or indirect interest in any assets which have been acquired, or disposed of by, or leased to any member of the Group, or were proposed to be acquired, or disposed of by, or leased to any member of the Group since 31 December 2018, the date to which the latest published audited consolidated financial statements of the Group were made up.

Each of the experts has given and has not withdrawn its written consent to the issue of this circular, with the inclusion therein of its report and/or the references to its name in the form and context in which it appears.

MISCELLANEOUS
1. The company secretary of the Company is Mr. Lo, Gordon, who is a member of the Hong Kong Institute of Certified Public Accountants.
2. The registered office of the Company is situated at Clifton House, 75 Fort Street, P.O. Box 1350, Grand Cayman KY1-1108, Cayman Islands and the principal place of business of the Company in Hong Kong is situated at Room 1801, 18/F., Great Eagle Centre, No. 23 Harbour Road, Wanchai, Hong Kong.
3. The Hong Kong branch share registrar and transfer office of the Company is Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong.
4. Save for the valuation report, the English text of this circular shall prevail over the Chinese text in the event of inconsistency.
DOCUMENTS AVAILABLE FOR INSPECTION
Copies of the following documents will be available for inspection during normal business hours at the principal place of business of the Company in Hong Kong at Room 1801, 18/F., Great Eagle Centre, No. 23 Harbour Road, Wanchai, Hong Kong on any weekday (except Saturdays, Sundays and public holidays) from the date of this circular up to and including the date of the EGM:
1. the memorandum of association and articles of association of the Company;
2. the annual reports of the Company for the years ended 31 December 2016, 31 December 2017 and 31 December 2018, and the interim report of the Company for the six months ended 30 June 2019;

- V-5 -

APPENDIX V	GENERAL INFORMATION

the written consents referred to in the paragraph headed "Experts and consents" in this appendix;
the letter from ZHONGHUI ANDA CPA Limited reporting on the unaudited pro forma financial information of the Group, the text of which is set out in Appendix III to this circular;
the valuation report, the text of which is set out in Appendix IV to this circular;
the material contracts referred to in the paragraph headed "Material Contracts" in this appendix;
the circular of the Company dated 30 January 2019; and
this circular.

- V-6 -

NOTICE OF The EGM

CHINA RUIFENG RENEWABLE ENERGY HOLDINGS LIMITED

中國瑞風新能源控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 527)

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the "EGM") of China Ruifeng Renewable Energy Holdings Limited (the "Company") will be held at Room 1801, 18/F, Great Eagle Centre, No. 23 Harbour Road, Wanchai, Hong Kong at 11:00 a.m. on 13 January 2020 for the purpose of considering and, if thought fit, passing (with or without amendments) the following ordinary resolution:

ORDINARY RESOLUTION

"THAT:

the sale and leaseback agreements and the transactions contemplated thereunder (the "Sale and Leaseback Agreements") dated 29 November 2019 entered into among between (i) Hebei Hongsong Wind Power Co., Ltd.* ("Hongsong")（河北紅松風力發電股份有限公司）, an indirect non wholly-owned subsidiary of the Company, as seller and lessee; and (ii) Huaneng Tiancheng Financial Leasing Co., Ltd.*（華能天成融資租賃有限公司）, as purchaser and lessor, in relation to the sale and leaseback of certain wind power generators, ancillaries, buildings and land use rights of a wind farm in Chengde City, Hebei Province, the PRC be and are hereby approved, confirmed and ratified; and
the board of directors of the Company (the "Directors") be and is hereby generally and unconditionally authorised to do all such acts and things and execute all such documents and to take all such steps as it considers necessary or expedient or desirable or to give effect to or in connection with paragraph (a), and all such acts and things the Directors have done, all such documents the Directors have executed, and all such steps the Directors have taken are hereby approved, confirmed and ratified."

By order of the Board

China Ruifeng Renewable Energy Holdings Limited

Zhang Zhixiang

Executive Director and Chief Executive Officer

Hong Kong, 24 December 2019

- EGM-1 -

NOTICE OF The EGM

Notes:

Any member of the Company entitled to attend and vote at the EGM shall be entitled to appoint another person as his proxy to attend and vote instead of him. A member who is the holder of two or more shares may appoint more than one proxy to attend and vote on his behalf at the EGM provided that if more than one proxy is so appointed, the appointment shall specify the number of shares of the Company in respect of which each such proxy is so appointed. A proxy need not be a member of the Company. On a poll, votes may be given either personally or by proxy.
The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer, attorney or other person duly authorised to sign the same.
To be valid, the instrument appointing a proxy and (if required by the board of directors of the Company) the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, shall be delivered to the Company's branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited of Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong not less than 48 hours before the time appointed for holding the EGM or any adjournment thereof (as the case may be).
No instrument appointing a proxy shall be valid after expiration of 12 months from the date named in it as the date of its execution, except at an adjourned meeting or on a poll demanded at the EGM or any adjournment thereof in cases where the EGM was originally held within 12 months from such date.
Where there are joint holders of any shares, any one of such joint holder may vote at the EGM, either in person or by proxy, in respect of such share as if he were solely entitled thereto, but if more than one of such joint holders be present at the EGM, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of other joint holders, and for this purpose, seniority shall be determined by the order in which the names stand in the Register of Members of the Company in respect of the joint holding.
Completion and return of an instrument appointing a proxy will not preclude a member from attending and voting in person at the EGM if the member so desire and in such event, the instrument appointing a proxy should be deemed to be revoked.
As at the date hereof, the executive Directors are Mr. Zhang Zhixiang (Chief Executive Officer), Mr. Ning Zhongzhi, Mr. Li Tian Hai and Mr. Peng Ziwei; and the independent non-executive Directors are Mr. Jiang Senlin, Mr. Qu Weidong and Ms. Hu Xiaolin.
A form of proxy for use at the EGM is enclosed.

For identification purpose only

- EGM-2 -

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China Ruifeng Renewable Energy Holdings Ltd. published this content on 23 December 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 December 2019 13:30:10 UTC

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