Stock Code: 000553(200553) Stock Abbreviation: ADAMA A (B) NO. 2024-52
ADAMA Ltd.Announcement on New Credit Facility from the
Related Party
I. Overview of the Related Party Transaction
The 33
rd
meeting of the 9
th
session of the Board of Directors of ADAMA Ltd.(hereinafter referred to as the “Company”) and the 1st Interim Shareholders Meetingin 2024 approved the Proposal on Credit Facility from the Related Party, according towhich Adama Fahrenheit B.V. (hereinafter referred to as "ADAMA NL"), anindirectly wholly-owned subsidiary of the Company signed an Facility Agreementwith Syngenta Group (NL) B.V. (hereinafter referred to as "SG NL"), a subsidiary ofthe Company's controlling shareholder, Syngenta Group Co., Ltd. (hereinafterreferred to as "SG"), and SG NL provided an amount of USD 200 million in favor ofADAMA NL. For details, please refer to the Announcement on Credit Facility of USD200 million from a Related Party (Announcement No.2024-24) disclosed on April 26,2024 (the "Previous Credit Facility").In order to meet the capital requirements for its operation and development, ADAMANL intends to apply to SG NL for a new credit line with an estimated amount of nomore than USD 200 million and sign a new facility agreement (the "Transaction").Since SG NL and ADAMA NL are both controlled by Sinochem HoldingsCorporation Ltd. (hereinafter referred to as " Sinochem Holdings”), the Transactionconstitutes a related party transaction.Among the five directors of the Company, the related-party directors, Mr. Qin Hengdeand Mr. Liu Hongsheng refrained from voting, while among the remaining votes of thethree directors, there were three (3) affirmative votes, and no negative votes and orabstentions. The Transaction has been reviewed by the Specialized Meeting of
Independent Directors of the Company and approved by all independent directors.The Transaction requires the approval of the Company’s shareholders. SG will refrainfrom voting.The Transaction does not constitute a Material Assets Restructuring as stipulated bythe Administrative Measures on Significant Asset Restructuring of Listed Companies.II. Introduction to the Related Party
SG NL was established in 2016. Its legal representative is Edwin Pool, and itsregistered address is Westeinde 62, 1601BK Enkhuizen, The Netherlands. It hasregistered capital of USD 2 and mainly undertakes the businesses related to holdingand financing activities. The main financial data as of December 31, 2023 is: operatingrevenue of USD 0, net profit of USD 501,249,000, total assets of USD 638,658,000,net assets of USD 10,827,000.Related-party relationship: Both SG NL and ADAMA NL are controlled by SinochemHoldings, the ultimate controlling shareholder of the Company. SG NL is related partyof the Company in accordance with Item 2, Paragraph 2 of Article 6.3.3 of the ListingRules of Shenzhen Stock Exchange.Analysis of contract performance capability: To the best of the Company’s knowledge,SG NL operates normally and is in good operational condition. After searching on thewebsite of disclosure of enforcement information of China, it is not a debtor subjectto judicial enforcement.III. Basic Information on the Target of the Related-Party Transaction
The Transaction is an engagement in a USD 200 million short-term annually revolvingcredit facility, at 3-month CME Term SOFR Reference Rate + 1.55% plus acommitment fee of 0.70% per annum on the undrawn amount (for the entire amountof USD 400 million, including on the Previous Credit Facility), subject to the FacilityAgreement signed between the two parties.IV. Pricing Basis of the Related-Party Transaction
The Transaction is made on the principles of voluntariness, equality, mutual benefit,justice and fairness. The terms of the Transaction were negotiated fairly on the basisof market practice.
V. Main Contents of the Facility Agreement
Contract Name: Facility Agreement between Adama Fahrenheit B.V. and SyngentaGroup (NL) B.V.Borrower: Adama Fahrenheit B.V.Lender: Syngenta Group (NL) B.V.Main Terms: annually revolving credit facility in the aggregate amount of USD 200million (on market terms), at 3-month CME Term SOFR Reference Rate + 1.55%plus a commitment fee of 0.70% per annum on the undrawn amount (for the entireamount of USD 400 million, including on the Previous Credit Facility).Both parties may assign their rights and obligations under the Facility Agreement toanother entity within their respective group according to the terms of the FacilityAgreement.Effective Date of the Agreement: following the approval of the Parties’ requisiteorgans, as required. The requisite organs of the Company will review the terms of thisAgreement every three years.Dispute Resolutions: Any controversy or claim that fails to be solved amicably shallbe finally submitted to the competent courts of Amsterdam under the laws ofNetherlands.VI. Purpose of the Transaction and Its Impact on the Company
The Transaction expands and efficiently utilizes the Company's and its subsidiariesfunding sources with additional facilities providing an additional cash source notincluded in bank covenants, and further supports the Company’s ongoing workingcapital needs. The Facility Agreement follows the general practice of similartransactions in the market and doesn’t contain unfair terms. The Transaction will notadversely affect the interests of the Company and its non-related party shareholders,nor will it affect the independence of the Company.VII. Status of the Different Kinds of Related Party Transactions between the Company
and Sinochem HoldingsThe related party transactions between the Company and subsidiaries of SinochemHoldings are as follows:
1.
As of June 30, 2024, the occurred amount of related party transactions withsubsidiaries of Sinochem Holdings in the ordinary course of business is around RMB1,335.25 million. The estimated related party transaction amount in the ordinary courseof business approved by the 2023 annual shareholders meeting is RMB 4,143.71million.
2. The Company and its subsidiaries’ Deposits and Loans in the Finance Company:
As of the date of this announcement, the balance of deposits remains RMB 379.79million and USD 2.14 million, and the loan amount is RMB 50 million, which havebeen approved by the 1
st
Interim Shareholders Meeting in 2022.
3. The 33rd meeting of the 9th session of the Board of Directors approved the Proposalon Credit Facility from the Related Party according to which SG NL shall enter intoan Facility Agreement and provide an amount of USD 200 million credit facility infavor of Adama NL, and the transaction has been approved by the 2024 1st InterimShareholders Meeting.
4. The 3rd meeting of the 10th session of the Board of Directors considered the Proposalon the Purchase of Liability Insurance for Directors, Supervisors and SeniorExecutives and the Related-party Transaction, according to which the Company willpurchase a Directors and Officers liability insurance policy by way of adding theCompany to the Directors and Officers liability insurance policy of SG, and thetransaction has been approved by the 2024 2nd Interim Shareholders Meeting.VIII. Independent Directors’ Prior Approval
The Company’s Specialized Meeting of Independent Directors approved theTransaction, and the independent directors have given approval opinions on theTransaction: The Transaction is based on the funding needs of the Company and is normalbusiness operations. The Transaction conforms to relevant national laws and regulations,as applicable, and market-oriented principles, and will not impact the independence of theCompany or harm the interests of the Company and its other shareholders. The decision-making procedures for the Transaction conform to the Company Law, the Rules ofShenzhen Stock Exchange for the Listing of Stocks, the Articles of Association of theCompany and other laws and regulations. Therefore, the independent directors pre-approved the Transaction and agree to submit it to the Board of Directors.
IX. Documents for Future Reference
1.
The resolutions of the 7
th
Meeting of the 10
th
Session of the Board of Directors of theCompany.2.
The resolutions of the Specialized Meeting of Independent Directors.
It is hereby announced.
The Board of Directors of ADAMA Ltd.
November 7, 2024
