BOE Precision Signed a Lease Framework Contract with BOE

On May 1, BOE Precision and BOE entered into a leasing framework contract from May 1, 2026 to April 30, 2029.

According to the agreement, BOE Precision will lease properties owned by BOE or its subsidiaries, and the lessor will charge rent based on the interests of all parties, market conditions and other factors.

The transactions contemplated under the Lease Framework Contract are new transactions with BOE, so there is no historical transaction data. For the financial years from May 1, 2026 to December 31, 2026, ending on December 31, 2027 and December 31, 2028, and for the period from January 1, 2029 to April 30, 2029, the annual caps stipulated in the Lease Framework Contract are HK$19 million, HK$15.5 million, HK$16 million and HK$5.5 million, respectively.

BOE Precision stated that the company plans to further integrate and optimize the existing operating structure and infrastructure configuration by leasing properties under the BOE Group. The board of directors believes that entering into the leasing framework contract will provide the Group with a set of real estate resource solutions that combine stability and flexibility. Given that BOE Group has a diversified property portfolio that is widely distributed and strategically located, this arrangement not only ensures that the company can obtain high-quality space that meets its production and office needs in a timely manner during its business expansion, but also helps reduce potential disruptions to daily operations caused by unstable property supply or frequent relocations.

By making good use of BOE Group's existing property resources and management capabilities, BOE Fine Electric is able to obtain the required properties on fair and reasonable terms with reference to independent third-party market leasing levels in similar regions, ensuring that relevant arrangements are in line with the overall interests of shareholders.

In addition, the above arrangement is highly consistent with BOE Precision's "asset-light" operating strategy, which eliminates the company's need to bear the huge initial capital expenditure required for the purchase of properties and related infrastructure construction, thus optimizing the overall capital allocation efficiency. As a result, BOE Precision has been able to focus its financial resources on high value-added areas such as technology research and development, production capacity improvement and other core business development, thereby enhancing the company's competitive advantage in the market.