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:
? Number of Independent Directors present at the BOD meeting: 6 (100%)
? Attendance of Audit Committee: Y
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