ADAMA Ltd.Announcement on Providing Guarantee by a Wholly-
owned Subsidiary to its Subsidiary
The Company and all members of the Company’s Board of Directors confirm that allinformation disclosed herein is true, accurate and complete, with no false or misleadingstatement or material omission.
I．OverviewMakhteshim Agan of North America Inc. (hereinafter referred to as “Seller”), a wholly-ownedsubsidiary of Adama Agricultural Solutions Ltd. (hereinafter referred to as "Solutions"), thewholly-owned subsidiary of ADAMA Ltd. (hereinafter referred to as "the Company"), intendto sell real property assets located at (i) 7745 Magnolia Industrial Blvd., Tifton, GA, (ii) 83Vernon Drive, Tifton, GA, and (iii) 364 Fitzgerald Hwy., Ocilla, GA (hereinafter referred toas “the target assets”) to FNLR Debugged LLC or an affiliate (hereinafter referred to as “theCounterparty”).Following the closing and delivery of the target assets, the Seller intends to sign a leaseagreement with the Counterparty, to lease back the target assets, with an estimated base rentof approximately USD 45.43 million over the initial term of 20 years (RMB 321.7 million),which requires guarantee by Solutions. Solutions agrees to provide the Counterparty with ajoint and several liability guarantee in favor of the Seller, for the payment of all rent andrelated costs under the above lease agreement.According to the Guidelines of Shenzhen Stock Exchange on Self-discipline Supervision ofListed Companies No.1: Standardized Operation of Main Board Listed Companies, the aboveguarantee is provided by the wholly-owned subsidiary of the Company for the legal entityconsolidated in the financial statements of the Company, and have fulfilled the internaldecision-making procedures of Solutions, therefore, it does not need to be submitted to theCompany’s board of directors or shareholders’ meeting for approval.II. Basic Information of the WarranteeName of the Warrantee: Makhteshim Agan of North America Inc.
Established Date: May 29, 1991Registered Address: 8601 Six Forks Rd., Suite 300, Raleigh, NC 27615Legal Representative: J. Mark HoughBusiness Scope: Agrichemical manufacturing and distributionRelationship with the Company: Solutions is the Company’s wholly-owned subsidiary, andthe Seller is an indirectly wholly-owned subsidiary of Solutions.Credit status: After searching the website of disclosure of enforcement information of China,the Seller is not a debtor subject to judicial enforcement.The most recent financial situation of the Seller is as follows:
Unit: ’000 USD
| At Jun 30 2024 (unaudited) | At Dec 31,2023 (audited) | |
| Total Assets | 364,713 | 461,202 |
| Total Liabilities | 210,310 | 314,857 |
| Bank Loans | 0 | 0 |
| Other Current Liabilities | 187,076 | 279,155 |
| Contingency | 0 | 0 |
| Net Assets | 154,403 | 146,345 |
| January to June 2024 (unaudited) | 2023 (audited) | |
| Revenue | 138,133 | 299,991 |
| Gross Profit | 17,892 | 40,151 |
| Net Profit / (Loss) | 8,058 | 12,351 |
III．Main Contents of the GuaranteeAccording to the guarantee agreement, Solutions approved providing the Counterparty withthe joint and several liability guarantee in favor of the Seller, to guarantee all rent, costs,expenses, liabilities, indemnities, damages and other monetary payment obligations for whichthe Seller as the Lessee is liable to the Lessor under the lease agreement. The estimated baserent under the lease agreement of approximately USD 45.43 million over the initial term of20 years (RMB 321.7 million) is the principal obligation guaranteed by Solutions. The Leaseautomatically renews a five (5) year term unless either party gives notice of termination. Thisautomatic renewal has a maximum of 4 renewal periods for a total potential of twenty (20)years. The guarantee will be terminated automatically six months after the date on which theleased property has actually been vacated in accordance with the lease agreement, and thelease agreement has been terminated.
The guarantor and the guaranteed party involved in this guarantee are all wholly-ownedsubsidiaries within the scope of the Company's consolidated statements, and the Company hascontrol over its production and operation, so the guarantee risk is under control. The purposeof this guarantee is to provide support to meet the actual business needs of the guaranteedparty, which is in line with the overall interests of the Company and will not adversely affectthe normal operation and business development of the Company, and there is no harm to theinterests of the Company and all shareholders.IV. Accumulated Quantity of External Guarantees and Overdue GuaranteesAs of June 30, 2024, the balance of the guarantees that have been provided by the Companyand/or its subsidiaries is RMB 4,554.53 million. After providing the above guarantees, thebalance of the guarantees provided by the Company and its subsidiaries will be RMB 4,876.23million, accounting for approximately 22.24% of the latest audited net assets of the Company.No guarantee is provided by the Company and/or its subsidiaries for the favor of entities notconsolidated in the Company’s financial statements.The Company and its controlled subsidiaries do not have overdue guarantees.V. List of Reference Documents
1. Guarantee Agreement signed by Solutions.
The Announcement is hereby made.
The Board of Directors of ADAMA Ltd.
September 28, 2024