Transactions with Affiliated Companies

Samsung Electronics Co. Ld

31 October 2023

 

Transaction with Affiliate Company

Samsung Electronics Co., Ltd. (KS005930, KS005935, SMSN, SMSD) ("SEC"), on October 31, 2023, announced that its Board of Directors ("BOD") has authorized the following related-party transaction with an affiliated company.

1. Real estate lease agreement

Owner of property	Samsung Electronics
Lessee	Samsung Display Co., Ltd.
Lease period	August 1, 2022-July 31, 2024
Transaction amount	KRW 15,692 million/year
Purpose of transaction	Lease of land or building
Terms and conditions	- Deposit: None - Annual rental payment: KRW 15,692 million - The annual rental payment is an average of appraisals calculated by multiple assessment institutions, considering asset price, expected profit, and other factors.   - The annual rental payment is calculated to be KRW 16,554 million for the first year (August 1, 2022 to July 31, 2023); and KRW 15,692 million for the second year (August 1, 2023 to July 31, 2024). - This is a correcting disclosure of the disclosure released on July 28, 2022, as the annual rental payment for the second year prescribed herein has been increased by 20% or more due to changes in the leased area.

2. Transaction with Samsung Display Co., Ltd

Company	Samsung Display Co., Ltd
Date	November 1, 2023
Purpose	Grant of a non-exclusive license for the process technology for the development and manufacturing of OLEDoS owned by SEC.
Amount	KRW 39.1 billion
Other	-The above date refers to the contract date of a non-exclusive license agreement with Samsung Display Co., Ltd. -Regarding the end date of the agreement, the term for the grant of a non-exclusive license is perpetual. -The above amount presents the total amount for the grant of the license during the agreement term and it is expected to be paid within 30 days after signing the agreement.

3. Purchase of assets

Transferee	Samsung Display Co., Ltd.
Scheduled purchase date	November 1, 2023
Purchased assets	Buildings and mechanical equipment owned by Samsung Display within SEC's Cheonan Site
Expected purchase price	KRW 10.5 billion
Purpose of transfer	Secure land for the construction of supplementary production facilities within the Cheonan Site
Others	- The scheduled purchased date above refers to the scheduled contract date, and the transfer of ownership is scheduled to take place within 30 days after signing the contract, subject to adjustments upon mutual agreement between parties.

Other Information:

ž Number of Independent Directors present at the BOD meeting: 6 (100%)

ž Attendance of Audit Committee: Y

 

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