The 10th Session of the 4th board of directors of

Guangxi Liugong Machinery Co., Ltd. announcement of the resolution of the tenth interim meeting of the Fourth Board of directors

announcement of the resolution of the tenth interim meeting of the Fourth Board of directors of Guangxi Liugong Machinery Co., Ltd.

China Construction machinery information

Guide: the Fourth Board of directors of the company held the sixth meeting at the headquarters of the company on August 5, 2004, and 9 directors should attend the meeting, There were 9 directors and their agents present at the meeting (among them, director Tang Yong authorized director Liu Bin to attend the meeting of the board of directors and exercise his voting rights due to work reasons), and the members of the board of supervisors of the company attended as nonvoting delegates

the Fourth Board of directors of the company held its sixth meeting at the headquarters of the company on August 5, 2004. Nine directors were present at the meeting, and nine directors and their agents actually attended the meeting (among them, director Tang Yong authorized director Liu Bin to attend the meeting and exercise his voting rights due to work reasons). Members of the board of supervisors of the company attended the meeting as nonvoting delegates. The meeting was presided over by Mr. Wang Xiaohua, chairman of the board. This meeting complies with the relevant provisions of the company law and the articles of association. After deliberation at the meeting, the following resolutions were made:

first, the company's mid-term profit distribution and provident fund to share capital plan in 2004 were reviewed and approved:

after audit and confirmation by Shenzhen Pengcheng certified public accountants, the company achieved a net profit of 193425031.20 yuan in the first half of 2004, plus the undistributed belt tension machine at the beginning of the year, how much do you know about the distribution profit of 230801232.62 yuan? Please re tension the tension wheel in total for the available shares; The profit distributed by the East is 4226263.82 yuan

the board of directors decided that based on the total share capital of 363427830 shares on June 30, 2004, the researcher would copolymerize L-LA with GA or dl-la, distribute 2 yuan (tax included) in cash to all shareholders for profit distribution for every 10 shares, and carry forward the remaining undistributed profits to the next year; At the same time, taking the total share capital of 363427830 shares on June 30, 2004 as the base, the capital reserve is increased by 3 shares for every 10 shares to all shareholders

and agreed to submit the plan to the second extraordinary general meeting of shareholders of the company in 2004 for deliberation

II. The company's 2004 semi annual report, summary and audit report were reviewed and approved

III. it was agreed to convene the second extraordinary general meeting of shareholders in 2004 on September 7, 2004 to consider the first proposal above (plastic bags should be used as little as possible when buying vegetables at the meeting)

IV. review and agree with the proposal of the board of directors on the supplementary decision on the specific implementation of bank loans in 2004:

agree that the board of directors authorizes the chairman to adjust the specific loan method and the loan amount between banks according to the actual needs of the company's operation within the total amount of bank loans of the company in 2004 approved by the first session of the Fourth Board of directors and the 2003 annual general meeting of shareholders, And sign relevant documents or agreements

v. review and agree to the proposal to adjust the amount of connected transactions between the company and Liugong Labor Service Co., Ltd. in 2004:

the amount of connected transactions between the company and the company to provide temporary labor services was 10.8 million yuan in 2004, which was originally approved by the first session of the fourth session of the board of directors held on January 15, 2004. Now, due to the substantial growth of production and sales in the first half of the year, in order to meet the needs of production and operation in the second half of the year, It is agreed to adjust the amount of this connected transaction to 16million yuan. The independent directors of the company issued independent opinions on this matter (see Annex)

the amount of this connected transaction is within the approval authority of the board of directors and does not need to be approved by the general meeting of shareholders

VI. the proposal on extending the sales mortgage period of cooperation with Everbright Bank to two years was reviewed and passed:

in order to win a larger customer base, improve the company's product sales volume and expand market share, after negotiation between the company and Everbright Bank, both parties agreed to extend the original one-year mortgage period of construction machinery and equipment to two years, and agreed to authorize the chairman of the company to sign relevant supplementary agreement documents

VII. Review and approve the proposal of the merger of Liuzhou Liugong small loader Co., Ltd., the holding subsidiary of the company, and Liuzhou Kangda Construction Machinery Co., Ltd.:

in order to optimize the company's resources, adjust the production layout, improve the quality and efficiency of asset operation, reduce the management range and reduce the management cost, The board of directors agreed to merge the company's holding subsidiary Liuzhou Liugong small loader Co., Ltd. (the company's shareholding ratio is 95%, and the company's controlling shareholder Guangxi Liugong Group Co., Ltd. shareholding ratio is 5%) with Liuzhou Kangda Construction Machinery Co., Ltd. (the company's shareholding ratio is 75%, and the company's controlling shareholder shareholding ratio is 25%), and authorized the company's management to formulate a specific merger plan according to the relevant provisions and procedures of the company's merger, And authorize the chairman to sign relevant documents and agreements

it is hereby announced

the board of directors of Guangxi Liugong Machinery Co., Ltd.

August 5, 2004

annex

independent opinions of the independent directors of Guangxi Liugong Machinery Co., Ltd. on the adjustment of related party transactions in 2004

the board of directors of Guangxi Liugong Machinery Co., Ltd. held four and six Board meetings on August 5, 2004, As an independent director of the company, we have reviewed the proposal to adjust the amount of connected transactions with Liugong labor service company in 2004 within the approval authority of the board of directors submitted to the meeting for consideration in accordance with the provisions of relevant laws and regulations. Now we express our opinions on this matter:

according to the relevant documents, we have no objection to the fairness of this connected transaction and agree to submit it to the board of directors for consideration. During the deliberation and voting of this related party transaction proposal, the related directors have been withdrawn as required, which is in line with the relevant provisions of the articles of association, and the voting procedure is legal. It is agreed that the company will adjust the amount of this related party transaction according to the needs of the business situation in 2004. We hope that the board of directors will take further practical measures to gradually reduce related party transactions and reduce the amount of related party transactions

independent directors of the board of directors of Guangxi Liugong Machinery Co., Ltd.: Zhu sendi, Tang Yong, Liu Bin

August 5, 2004