Stock Code: 000055, 200055 Stock ID: Fangda Group, Fangda B
Announcement No. 2012-11
China Fangda Group Co., Ltd.
Resolutions of the 8th Meeting of the 6th Term of Board
The members of the Board and the Company acknowledge being responsible for the
truthfulness, accuracy, and completeness of the announcement. Not any false record,
misleading statement or significant omission carried in this announcement.
The Board of Directors of China Fangda Group Co., Ltd. (“The Company”
hereinafter) delivered the meeting circulars by means of written and fax notices on
March 12, 2012. The 8th meeting of the 6th term of Board of Directors was held in the
meeting room of the Company in the morning of March 20, 2012. All of the 7
directors presented the meeting. The meeting is complying with the provisions set out
by the Company Law and the Article of Association of the Company. Chairman Xiong
Jianming presided the meeting. The following resolutions were adopted:
I. The proposal to terminate the plan to issue A-shares privately in year 2011
The plan to issue A-shares privately in 2011 was adopted on the 5th meeting of
the 6th term of Board held on October 27, 2011. According to the plan, the proceeds
will be invested to the curtain wall production bases in Chengdu and Beijing, and
construction of sales networks. With great effort made by the Company, the
investment memorandum has been signed with Xinjin County Government, but the
land-using certificate is not obtained yet. Thus it is hard to predict the progress of this
project. The project in Beijing has not been proceeding up to present. Therefore the
Company has decided to seize the plan of private issuing in year 2011. Capital needed
for the curtain wall projects in Chengdu and Beijing and the sales network project will
be financed by the Company in other ways to ensure rapid growth of the Company’s
business.
II. The proposal on satisfying of the conditions to apply for issuing of A
shares privately;
Basing on the Company Law of PRC, Securities Law of PRC, Administration Rules of PLCs
and Share Listing, Detailed Regulations of Private Issuing of Shares, and related laws, regulations
and documents, with reference to related qualifications, conditions, and requirements of private
share issuing, the Company is considered qualified to issue A-shares privately.
III. The proposal on the plan to issue A-shares privately in 2012 (voted
separately)
(I). Way of issuing
Private issuing to the largest shareholder of the Company.
(II). Category and face value of the shares to be issued
Shares issued are RMB common shares (A shares) with face value of RMB1.00
per share.
(III). Amount to be issued
The total amount of A-shares to be issued this time will not more than 35 million
shares (included). If the Company conducted dividend distribution, bonus share
distribution, capitalizing of common reserves during the period from the pricing
ex-date to the issuing date, the amount and price to be issued will be adjusted
accordingly.
(IV). The subscriber and way of subscribing
Shenzhen Banglin Technology Development Co., Ltd. (Banglin Technology) –
the largest shareholder of the Company, will be the only subscriber this time.
(V). Benchmark day and the price
The pricing ex-date will be the day when the announcement of resolutions of the
8th meeting of the 6th term of Board (March 21, 2012). The price will be 90% of the
average price in 20 days prior to the pricing ex-date, namely RMB4.27 per share.
In case ex-dividend or ex-interest events happened during the period from
pricing ex-day to issuing day, such as dividend distribution, bonus shares, or
capitalizing of common reserves, the price shall be adjusted correspondingly.
The average price in 20 days prior to the ex-day = Total value of share trading in
20 days prior to the ex-day ?total amount of shares traded in 20 days prior to the
ex-day.
(VI). Arrangement of trade-limitation period
Shares subscribed by Banglin Technology at this private issuing are not allowed
to be transferred in 36 months since the closing day of this private issuing.
(VII). Place of listing
Upon expiration of the above mentioned limitation period, the said shares will be
listed and traded in Shenzhen Stock Exchange.
(VIII). Amount and usage of proceeds
A-shares issued this time will not be more than 35 million shares (included). If
the Company conducted dividend distribution, bonus share distribution, capitalizing
of common reserves during the period from the pricing ex-date to the issuing date, the
amount to be issued will be adjusted accordingly.
Proceed raised from this private issuing will not more than RMB149.45 million,
which will be used to support the working capital of the Company.
(IX). Distribution preplan of the retained profit before this issuing of A-shares
Upon accomplishing of the issuing, the new shareholders will share the retained
profit of the current year and accumulated from previous years along with the existing
shareholders.
(X). Effective period of the resolution
The resolution will be effective for 12 months since it was approved by the
Shareholders’ Meeting.
IV. Preplan of private issuing of A-shares in 2012;
“The preplan to issue new A shares privately in 2012 of China Fangda Group Co.,
Ltd.” is available with Securities Times, China Securities Journal, Shanghai Securities
Daily, Hong Kong Commercial Daily (English), and http://www.cninfo.com.cn dated
March 21, 2012.
V. The proposal of feasibility report on the application of proceeds from
issuing of A-shares privately in 2012
The full text of the “Feasibility Report on the Application of Proceeds From
Issuing of A-shares Privately in 2012” is available hereafter.
VI. Proposal on requesting the Shareholders’ Meeting to authorize the
Board with full responsibility and power on the practical issues related to the
private issuing of new shares in 2012
In view of smooth implementation of the private issuing, the Board request the
Shareholders’ Meeting to authorize the Board with full responsibility and power on
the practical issues related to the private issuing of new shares in 2012, including but
not limited to:
(1) Produce and implement operational plans for the private issuing according to
the practical situation regarding timing, amount of issuing, start and terminate date,
and deciding of the issuing price.
(2) To enter major contracts (including the subscribing contract with the
subscriber) or other legal papers regarding this private issuing
(3) To employ agencies such as sponsors and undertake filing procedures for the
private issuing;
(4) To modify the capital registration, the related clauses of Articles of Association, and alter
the business registration according to the results of this private issuing;
(5) Upon accomplishing of the private issuing, to undertake procedures with Shenzhen Stock
Exchange regarding the locking of listing date of the newly issued shares;
(6) To handle other issues related to the private issuing;
(7) If the regulatory department of the government has new regulations on private issuing of
shares, to make corresponding adjustment on the practical plan of private issuing in accordance
with the new policies or regulations.
This authorization is effective in 12 months since it was approved by the
Shareholders’ Meeting.
VII. The proposal to enter the conditional share subscribing contract with Shenzhen
Banglin Technology Development Co., Ltd.
VIII. The proposal about subscribing of shares privately by the largest shareholder that is a
related transaction.
The announcement about subscribing of shares privately by the largest shareholder that is a
related transaction is available with Securities Times, China Securities Journal, Shanghai
Securities Daily, Hong Kong Commercial Daily (English), and
http://www.cninfo.com.cn dated March 21, 2012.
IX. The proposal to call up the 2nd provisional shareholders’ meeting 2012
The Company has decided to call up the 2nd provisional shareholders’ meeting
2012 on April 5, 2012, the public notice is available with Securities Times, China
Securities Journal, Shanghai Securities Daily, Hong Kong Commercial Daily
(English), and http://www.cninfo.com.cn dated March 21, 2012.
Mr. Xiong Jianming and Mr. Xiong Jianwei avoided the voting on proposal
III, IV, VII, and VIII, which were passed with 5 votes in favor, 0 waive, and 0
objection respectively. The proposal I, II, V, VI, and IX were passed with 7 votes
in favor, 0 objection, and 0 waive respectively.
The above proposal II to VIII are subject to the examination of the 2nd
provisional shareholders’ meeting 2012.
The above is for the attention of the shareholders.
China Fangda Group Co., Ltd.
The Board of Directors
March 21, 2012
Attachment:
China Fangda Group Co., Ltd.
The feasibility report on application of the proceeds from issuing of A-shares
privately in year 2012
I. Application plan of the proceeds
Proceed raised from this private issuing will not more than RMB149.45 million,
which will be used to support the working capital of the Company.
II. Necessity and feasibility of using the proceeds
(I) Necessity and feasibility of using the proceeds
1. Along with the growth of the curtain wall and PSD market in recent years, the
Company’s business kept growing constantly, and brought greater demand in capital.
Shortness of working capital has been greatly limiting the rapid developing of the
Company’s business. And the market effect has not been fully developed.
2. As the characteristics of the curtain wall and PSD projects, the capital circulation
periods are relatively long. Furthermore, a number of contracting and warranty
deposits have occupied a large amount of working capital. Although the Company has
used all measures to increase the effectiveness of capital operation, but still facing
shortage of working capital.
3. Influenced by the restricting monetary policies of the national government, the
deposit reserve ratio is at the historical high level and the benchmark interest rate has
been rising. The Company is under great pressure of financial expenses and financial
resources.
(II) Feasibility of the usage of proceeds
Benefit from the national policies, the Company’s curtain wall and PSD products are
expecting a good trend in the market. This issuing of shares will support the
Company’s working capital and reinforce the competition. It will greatly help to
empower the business operation and ensure a sustainable development. It is for the
greatest benefit for the shareholders.
III. Influences on the administration and financial situation
(I) Influences on the administration practice
Usage of the proceeds from this private issuing of A-shares is complying with the
national policies and strategy approach. It will bring good perspective and economical
efficiency. Upon completion of the projects, the Company will be further reinforced
for its competition power and leading position in the industry. Greater profitability
will not only contribute to the Company’s growth, but also to the benefits of the
shareholders.
(II) Influences on financial situation
The following calculations are based on the assumption of proceeds amounted to
RMB149.45 million, and the financial data are provide basing on the consolidated
financial statements.
1. Lift the scales of total asset and net asset, increase risk-resistance power
Upon completion of this private issuing, the total asset and net asset will both increase
by RMB149.45 million. As soon as the economical effectiveness has realized, both of
the total asset and net asset will be growing continuously. And the Company’s
risk-resistance will be increased simultaneously.
2. Increase business income and profitability
Proceeds of this private issuing will be used to support the working capital. On the
one side, it may satisfy the needs of business development, further reinforce the main
businesses of the Company; on the other side, it will contribute to the achieving of
economy of scale, and lower the costs, as well as increasing the profitability.
IV. Filing and approving issues involved
No land using, environmental issues, or project approval issues involved for the
proceeds of this private issuing will be used as working capital.
