Securities code: 836171 Securities abbreviation: Shenma Huawei Host brokerage: Zhongyuan Securities

　　Henan Shenma Warwick Plastic Co., Ltd.

　　Announcement on Supplemental Confirmation of Incidental Related Party Transactions

　　The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete, and that there are no false records, misleading statements or major omissions, and bear individual and joint legal responsibility for the authenticity, accuracy and completeness of the contents.

　　1. Overview of related party transactions

　　(1) Overview of related party transactions

　　This related party transaction is an occasional related party transaction.

　　1. According to the agreement signed by the two parties in March 2018, the company sold goods for 164,102.56 yuan to the related party Pingdingshan Shenma Engineering Plastics Technology Development Co., Ltd.;

　　2. According to the agreement signed by the two parties in July 2018, the company purchases 2,274,025.86 yuan of goods from the related party Pingdingshan Shenma Engineering Plastics Technology Development Co., Ltd.;

　　3. According to the agreement signed by both parties in June and August 2018, the company purchased 1,468,467.07 yuan of goods from the related party Henan Shenma Nylon New Material Co., Ltd.

　　4. According to the agreement signed by the two parties in April 2018, the company sold goods for 207,265.64 yuan to the related party Henan Shenma Nylon New Material Co., Ltd.

　　The signing locations of the above agreements are all in Pingdingshan, Henan.

　　(2) Voting and deliberation

　　On August 22, 2018, the company held the second meeting of the second board of directors to deliberate the "Proposal on Supplemental Confirmation of Incidental Related Party Transactions". Related directors Wang Jun, Yang Jianzhong, and Cui Baoping abstained from voting because less than half of the non-related directors were non-associated directors. This proposal is directly submitted to the general meeting of shareholders for deliberation.

　　(3) There is no situation requiring approval by relevant departments in this connected transaction

　　2. Introduction to related parties

　　(1) Basic information about related parties

　　1. Legal persons and other economic organizations

　　Name: Pingdingshan Shenma Engineering Plastic Technology Development Co., Ltd.

　　Domicile: Gongdian Township Chemical Industry Cluster Area, Ye County, Pingdingshan City

　　Registered address: Gongdian Township Chemical Industry Cluster Area, Ye County, Pingdingshan City

　　Enterprise Type: State-owned Enterprise

　　Legal representative (if applicable): Yang Jianzhong

　　Actual controller: State-owned Assets Supervision and Administration Commission of Henan Province

　　Registered capital: 100 million yuan

　　Main business: manufacturing, processing, and selling plastics, chemical fibers and their products.

　　2. Legal persons and other economic organizations

　　Name: Henan Shenma Nylon New Material Co., Ltd.

　　Address: Phase I of Shenma Industry (Building 11), the middle section of Jianshe Road, Weidong District, Pingdingshan City

　　Registered address: Shenma Industrial Phase I (Building 11), the middle section of Jianshe Road, Weidong District, Pingdingshan City

　　Enterprise Type: State-owned Enterprise

　　Legal representative (if applicable): Huang Hejun

　　Actual controller: State-owned Assets Supervision and Administration Commission of Henan Province

　　Registered capital: 3509000 yuan

　　Main business: production and sales of nylon spigot cloth, nylon chips and injection molded products

　　(2) Associated relationship

　　Pingdingshan Shenma Engineering Plastics Technology Development Co., Ltd., Henan Shenma Nylon New Material Co., Ltd. and the company are all controlled by the same group.

　　3. The pricing policy, pricing basis and fairness of the transaction

　　(1) Pricing policy and pricing basis

　　The company’s transactions with related parties are fair and follow the principle of market pricing, fair and reasonable, and there is no behavior that harms the interests of the company and any other shareholders of the company, and the company’s independence is not affected by related transactions.

　　Fourth, the main content of the transaction agreement

　　1. The company sold goods for RMB 164,102.56 to the related party Pingdingshan Shenma Engineering Plastics Technology Development Co., Ltd.;

　　2. The company purchases 2,274,025.86 yuan of goods from the related party Pingdingshan Shenma Engineering Plastics Technology Development Co., Ltd.;

　　3. The company purchased 1,468,467.07 yuan of commodities from the related party Henan Shenma Nylon New Material Co., Ltd.

　　4. The company sold 207,265.64 yuan of goods to the related party Henan Shenma Nylon New Material Co., Ltd.

　　V. The purpose of related party transactions and their impact on the company

　　(1) Purpose and impact on the company

　　The purchase of goods and the sale of products in this connected transaction are normal marketing activities, with the purpose of maintaining production and normal operations.

　　This related party transaction is executed in strict accordance with the related party transaction pricing principles, and will not have an adverse impact on the company's current and future financial status and operating results. There is no circumstance that harms the interests of the company and other shareholders, and there is no transfer of interests, and the independence of the company has not been affected by the transaction.

　　6. List of documents available for inspection

　　"Resolutions of the Second Meeting of the Second Board of Directors of Henan Shenma Warwick Plastic Co., Ltd."

　　Henan Shenma Warwick Plastic Co., Ltd.

　　Board of Directors

　　August 22, 2018