Tengzhou Eastern and Jiaxing Eastern announced that, on 13 April 2023, NV Bekaert SA and the companies entered into the Patent License Agreement, pursuant to which Bekaert, being the owner of the Licensed Patent, agreed to grant the License Rights to Tengzhou East and Jiaxing Eastern subject to the terms and conditions therein. The Licensed Patent is a patent for invention registered in the PRC for certain steel cord constructions. Tengzhou Eastern and Jiaxing Eastern have applied the Licensed Patent in the Licensed Products manufactured in their respective plants in operation.

Unless terminated earlier in accordance with the terms of the Patent License Agreement, the Patent License Agreement shall be effective retroactively from 1 January 2023 to 31 December 2023. Pursuant to the Patent License Agreement, Tengzhou Eastern and Jiaxing Eastern shall pay to Bekaert a royalty which is calculated by multiplying the net sales amount of the Licensed Products by the applicable tiered royalty rate. Different specified royalty rates are payable for different average monthly sales volume of the Licensed Products.

Reports about the sales of the Licensed Products sold are required to be submitted by Tengzhou Eastern and Jiaxing Eastern to Bekaert on a quarterly basis.