Stock Code: 000553(200553) Stock Abbreviation: ADAMA A (B) NO. 2022-32
ADAMA Ltd.
Announcement on Credit Facility of USD 50
million from the Related Party
The Company and all members of the Company’s Board of Directors confirm that all information
disclosed herein is true, accurate and complete, with no false or misleading statement or material
omission.
The Company and all members of the Company’s Board of Directors confirm that all information
disclosed herein is true, accurate and complete, with no false or misleading statement or material
omission.Overview of the Related Party Transaction
On December 14, the 16th meeting of the 9th session of the Board of Directors of
ADAMA Ltd. (hereinafter referred to as the “Company”) approved a proposal on the
amendment of the previously approved Credit Facility Agreement, entered into by and
between Syngenta Group (NL) B.V. ( hereinafter referred to as "SG NL"), a subsidiary
of the Company's controlling shareholder, Syngenta Group Co., Ltd. (hereinafter
referred to as "SG"), and Adama Fahrenheit B.V. ( hereinafter referred to as "ADAMA
NL"), an indirectly wholly-owned subsidiary of the Company, according to which SG
NL shall provide an additional amount of USD 50 million (to an aggregate amount of
USD 100 million committed short-term credit facility) as part of the current
committed short-term credit facility approved in October 2021 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 related
party transaction.
Among the five directors of the Company, the related-party directors, Mr. Erik Fyrwald
and Mr. Chen Lichtenstein refrained from voting, while among the remaining votes of
the three directors, there were three (3) affirmative votes, and no negative votes and or
abstentions. The independent directors also issued their independent opinion.
The Transaction is within the approval line of the Board of Directors and is not subject
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to the approval of the shareholders.
The Transaction does not constitute a Material Assets Restructuring as stipulated by
the 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 its
registered address is Westeinde 62, 1601BK Enkhuizen, The Netherlands. It has
registered capital of EUR 1 and mainly undertakes the businesses related to holding
activities. The main financial data as of December 31, 2021 is: operating revenue of
USD 0, net profit of USD 383,747,000, total assets of USD 43,141,531,000, net assets
of USD 41,294,980,000.
Related-party relationship: Both SG NL and ADAMA NL are controlled by
SinoChem Holding, the actual controller of the Company. SG NL is related party of
the Company in accordance with Item 2, Paragraph 2 of Article 6.3.3 of 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 the
website of disclosure of enforcement information of China, it is not a debtor subject
to judicial enforcement.
III. Basic Information on the Target of the Related-Party Transaction
The Transaction is for the amendment of the previously signed committed short-term
credit facility in the aggregate amount of USD 50 million on market terms or
preferable terms, by way of increasing the facility by additional USD 50 million short-
term committed annually revolving credit line, at 3-month Libor + 1.6% - to an
aggregate USD 100 million committed short-term credit facility (the "Amendment to
the Credit Facility Agreement").
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 basis
of market practice.
V. Main Contents of the Amendment to the Credit Facility Agreement
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Contract Name: Amendment to the Credit Facility Agreement by and between Adama
Fahrenheit B.V. and Syngenta Group (NL) B.V.
Borrower: Adama Fahrenheit B.V.
Lender: Syngenta Group (NL) B.V.
Main Terms: committed short-term credit facility in the aggregate amount of USD
100 million (on market terms or on preferable terms) by way of increasing the current
USD 50 million short-term committed annually revolving credit line, at 3-month
Libor + 1.6% by an additional USD 50 million under same terms.
Effective Date of the Agreement: the date the Agreement is duly signed, following the
approval of the Board of Directors of the Company. The Board of Directors of the
Company will review the terms relating to the aggregated USD 100 million short-term
revolving credit line every three years.
Dispute Resolutions: Any controversy or claim that fails to be solved amicably shall
be finally submitted to the competent courts of Amsterdam under the laws of
Netherlands.
VI. Purpose of the Transaction and Its Impact on the Company
The Transaction expands and efficiently utilizes the Company's and its subsidiaries
funding sources with committed facilities providing an additional cash source not
included in bank covenants. The Amendment to the Credit Facility Agreement follows
the general practice of similar transactions in the market and doesn’t contain unfair
terms. The Transaction will not adversely 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 Kind of Related Party Transactions between the Company
and SinoChem Holding
The related party transactions between the Company and subsidiaries of Sinochem
Holding are as follows:
1. From January 1, 2022 till September 30, 2022, the occurred related party transactions
with subsidiaries of SinoChem Holding in the ordinary course of business is RMB
3,660.24m. The estimated related party transaction amount in the ordinary course of
business approved by the 2021 annual shareholders meeting is RMB 5,141.09m.
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2. Deposits of the Company and its wholly-owned subsidiary ADAMA Anpon (Jiangsu)
Ltd. deposited in the Sinochem Finance Co., Ltd.: As of the date of this announcement,
the balance of deposits remains RMB 353,440,000 and USD 740,000, which have
been approved by the 1st interim shareholders meeting of the Company in 2022.
VIII. Independent Directors’ Opinions
The Company’s independent directors have given separate opinions on the Transaction:
The Amendment to the Credit Facility Agreement is based on the funding needs of the
Company and is normal business operations. The Transaction conforms to relevant
national laws and regulations, as applicable, and market-oriented principles, and will not
impact the independence of the Company 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 of Shenzhen Stock Exchange for the Listing of Stocks, the
Articles of Association of the Company and other laws and regulations. Therefore, the
independent directors approved the Transaction.
IX. Documents for Future Reference
1. The resolution of the 16th Meeting of the 9th Session of the Board of Directors of the
Company;
2. Independent directors’ opinion and their prior written approval.
It is hereby announced.
The Board of Directors of ADAMA Ltd.
December 16, 2022
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