Harbin Electric Company Limited announced that 3 years term of the management entrustment agreement entered into between the company and Harbin Electric Corporation (Harbin Electric) on March 23, 2013 will expire soon. The Board of Directors of the company hereby announced that, on January 29, 2016, the Board has considered an approved the new management entrustment agreement entered into between the company and Harbin Electric, pursuant to which, the company will provide management services to Harbin Electric, including but not limited to administration management, human resources and labour wage management (including external affairs management), quality control on technology, asset and financial management, integrated planning management, statistics and economic operation management, auditing and internal control management, investment management, strategic development management, legal affairs management, information management, marketing management, project management, production safety management, compliance management, management of political work and other affairs, etc. Harbin Electric will pay management entrustment fee to the company.

The management entrustment agreement will be duly effective from March 23, 2016.