Stock Code: 000553(200553) Stock Abbreviation: ADAMA A (B) NO. 2024-24
ADAMA Ltd.Announcement on Credit Facility of USD 200
million from a Related Party
I. Overview of the Related Party Transaction
On April 25, 2024, the 33
rd
meeting of the 9
th
session of the Board of Directors ofADAMA Ltd. (hereinafter referred to as the “Company”) approved entering into anadditional Facility Agreement, entered into by and between Syngenta Group (NL) B.V.(hereinafter referred to as "SG NL"), a subsidiary of the Company's controllingshareholder, Syngenta Group Co., Ltd. (hereinafter referred to as "SG"), and AdamaFahrenheit B.V. ( hereinafter referred to as "ADAMA NL"), an indirectly wholly-owned subsidiary of the Company, according to which SG NL shall provide a newand additional amount of USD 200 million in favor of ADAMA NL (the"Transaction").Since SG NL and ADAMA NL are both controlled by SinoChem Holding Co., Ltd.(hereinafter referred to as "SinoChem Holding”), the Transaction constitutes a relatedparty 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. All the Company’s independent directors provided opinions andpreapproved the Transaction.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, 2022 is: operatingrevenue of USD 426,615,000, net profit of USD 420,092,000, total assets of USD43,242,400,000, net assets of USD 41,315,072,000.Related-party relationship: Both SG NL and ADAMA NL are controlled bySinoChem Holding, the ultimate controlling shareholder of the Company. SG NL isrelated party of the Company in accordance with Item 2, Paragraph 2 of Article 6.3.3of the Listing Rules 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%, subject to theFacility Agreement 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 by and between Adama Fahrenheit B.V. andSyngenta Group (NL) B.V. (Dated April 2024)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%.
The Lender shall be entitled to request an immediate repayment of the outstandingbalance of the facility, upon a prior notice of fifteen (15) business days.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 HoldingThe related party transactions between the Company and subsidiaries of SinochemHolding are as follows:
1.
The occurred amount of related party transactions with subsidiaries of SinoChemHolding in the ordinary course of business is around RMB 800.89 million. Theestimated related party transaction amount in the ordinary course of business approvedby the 2023 annual shareholders meeting is RMB 4,143.71m.
2. Deposits of the Company and its subsidiaries in the Sinochem Finance Co., Ltd.: Asof the date of this announcement, the balance of deposits remains RMB544,670,374.05 and USD 6,486,452.39, which have been approved by the 1st interim
shareholders meeting of the Company in 2022.VIII. Independent Directors’ Pre-approval
The Company’s independent directors have preapproved the Transaction: The Transactionis based on the funding needs of the Company and is normal business operations. TheTransaction conforms to relevant national laws and regulations, as applicable, and market-oriented principles, and will not impact the independence of the Company or harm theinterests of the Company and its other shareholders. The decision-making procedures forthe Transaction conform to the Company Law, the Rules of Shenzhen Stock Exchange forthe Listing of Stocks, the Articles of Association of the Company and other laws andregulations. Therefore, the independent directors pre-approved the Transaction andagree to submit it to the Board of Directors.IX. Documents for Future Reference
1.
The resolution of the 33
rd
Meeting of the 9
thSession of the Board of Directors of the
Company;2.
Independent directors’ prior written approval.
It is hereby announced.
The Board of Directors of ADAMA Ltd.
April 26, 2024