Securities code: 002180 securities abbreviation: Ninestar Corporation(002180) Announcement No.: 2022-007 Ninestar Corporation(002180)
Announcement of resolutions of the 28th meeting of the 6th board of directors
The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete, and are liable for false records, misleading statements or major omissions in the announcement.
The 28th meeting (emergency meeting) of the sixth board of directors of Ninestar Corporation(002180) (hereinafter referred to as “company”, “listed company” or ” Ninestar Corporation(002180) “) was held by means of communication on January 30, 2022. The notice of the meeting was sent to all directors by e-mail, wechat and other means on January 30, 2022. Nine directors should be present and nine directors actually attended the meeting, Nine directors participated in the voting, and related directors avoided voting on related matters. The convening and voting procedures of the meeting comply with the relevant provisions of the company law, the articles of association and the rules of procedure of the board of directors. The following proposals were considered and passed at the meeting:
1、 The proposal on the provision of loans and related party transactions by the company and its controlling shareholders to Ninestar Holdings Company Limited, an overseas holding subsidiary, was considered and adopted by 6 votes in favor, 0 against and 0 abstention
In November 2016, the company jointly acquired 100% equity of Lexmark international, Inc. (hereinafter referred to as “Lexmark international”) with joint investors PAG Asia Capital Lexmark Holding Limited (hereinafter referred to as “taimeng”) and Shanghai Shuoda Investment Center (limited partnership) (hereinafter referred to as “Shuoda”).
Ninestar Holdings Company Limited, the overseas holding subsidiary of the listed company (hereinafter referred to as “Cayman joint venture”, holding 100% equity of Lexmark International), as the borrower, plans to sign a loan agreement of US $367 million, And Ninestar Corporation(002180) and its controlling shareholder Zhuhai Saina Printing Technology Co., Ltd. (hereinafter referred to as “Saina technology”) as the lenders, with loans of US $167 million and US $200 million respectively.
Mr. Wang Dongying and Mr. Yan Wei, the directors of the company, are the directors of sina technology. Mr. Kong Dezhu, the director, has served as the senior management of Sina Technology in the past 12 months. They are all affiliated directors and need to avoid voting on this proposal. The other six non affiliated directors (including three independent directors) voted on this proposal.
Independent directors have expressed independent opinions and prior approval opinions on this. For details of independent directors’ independent opinions on matters related to the 28th meeting of the 6th board of directors and independent directors’ prior approval opinions on matters related to the 28th meeting of the 6th board of directors, see http://www.cn.info.com.cn. The independent financial consultant issued the verification opinions. For details of the verification opinions of Huatai United Securities Co., Ltd. on Ninestar Corporation(002180) and the company’s controlling shareholder’s provision of loans and related party transactions to Ninestar Holdings Company Limited, an overseas holding subsidiary, see http://www.cn.info.com.cn.
The announcement on the provision of loans and related party transactions by the company and its controlling shareholders to Ninestar Holdings Company Limited, an overseas holding subsidiary, is detailed in securities times, China Securities News, Securities Daily, Shanghai Securities News and cninfo (www.cn. Info. Com. CN) on February 8, 2022.
This proposal needs to be submitted to the second extraordinary general meeting of shareholders of the company in 2022 for deliberation and approval.
2、 The proposal on capital increase of its subsidiaries by Ninestar Holdings Company Limited, an overseas holding subsidiary, was considered and adopted by 9 votes in favor, 0 against and 0 abstention. In order to optimize the asset liability structure of Lexmark international, The board of directors agreed that the Cayman joint venture company would increase the capital of Lexmark International (hereinafter referred to as “this foreign investment”) by using the US $290 million of the loan in the above proposal on the company and its controlling shareholders providing loans and related party transactions to Ninestar Holdings Company Limited, an overseas holding subsidiary. This foreign investment does not involve related party transactions, nor does it constitute a major asset reorganization stipulated in the administrative measures for major asset reorganization of listed companies.
Independent directors have expressed independent opinions on this. See http://www.cn.info.com.cn for the independent opinions of independent directors on matters related to the 28th meeting of the 6th board of directors.
For details of the announcement on capital increase of its subsidiaries by Ninestar Holdings Company Limited, an overseas holding subsidiary, see securities times, China Securities News, Securities Daily, Shanghai Securities News and cninfo (www.cn. Info. Com. CN.) on February 8, 2022.
This proposal needs to be submitted to the second extraordinary general meeting of shareholders of the company in 2022 for deliberation and approval.
3、 The proposal on share repurchase of Ninestar Holdings Company Limited, an overseas holding subsidiary, was considered and adopted by 9 votes in favor, 0 against and 0 abstention
The board of directors agreed that the Cayman joint venture company would repurchase 25875 shares and 3543 shares of the Cayman joint venture company held by taimeng and Shuoda respectively, with a repurchase price of US $2617 per share, using the US $77 million of the loan in the above proposal on the loan and related party transactions provided by the company and its controlling shareholders to Ninestar Holdings Company Limited, an overseas holding subsidiary. If the Cayman joint venture fails to pay the full purchase price on or before February 28, 2022, the total purchase price of US $77 million will remain unchanged, but the number of shares repurchased by the Cayman joint venture shall be revised downward, That is, the repurchase price per share paid by the Cayman joint venture for such repurchased shares is equal to the following amount: (I) the subscription price paid by the repurchased party for the repurchased shares on the date of the original investment in the Cayman company, Plus (II) the return calculated at the annual interest rate of 6% (compound interest per year) during the period from the date of the repurchased Party’s original investment in the Cayman joint venture to the date of withdrawal of this loan.
Independent directors have expressed independent opinions on this. See http://www.cn.info.com.cn for the independent opinions of independent directors on matters related to the 28th meeting of the 6th board of directors.
The announcement on share repurchase of Ninestar Holdings Company Limited, an overseas holding subsidiary, is detailed in securities times, China Securities News, Securities Daily, Shanghai Securities News and cninfo (www.cn. Info. Com. CN.) on February 8, 2022.
This proposal needs to be submitted to the second extraordinary general meeting of shareholders of the company in 2022 for deliberation and approval.
4、 The proposal on Amending the shareholders’ agreement of Ninestar Holdings Company Limited was considered and adopted by 9 votes in favor, 0 against and 0 abstention
In order to further promote the development of Lexmark international and enhance the profitability of Lexmark international, as well as to fulfill the agreement on the repurchase of part of the equity of the Cayman joint venture held by taimeng and Shuoda in the shareholders’ agreement, the Cayman joint venture plans to borrow from Ninestar Corporation(002180) and its controlling shareholder Saina technology. For this purpose and based on the requirements of applicable laws, the company amended the shareholders’ agreement in accordance with the provisions of the shareholders’ agreement and the articles of association of the Cayman joint venture. The main contents of the amendment are as follows:
1. US $367 million loan agreement (“phase I loan agreement”) and partial equity repurchase a) Cayman joint venture, as the borrower, signed the phase I loan agreement with the principal amount of US $367 million. It is proposed that Ninestar Corporation(002180) and the controlling shareholder Zhuhai Saina Printing Technology Co., Ltd. borrow us $167000000 and US $200000000 respectively. The loan term is 5 years.
b) About US $290000000 in the first phase of the loan will be used as the capital injection of the Cayman joint venture to its subsidiaries and finally to Lexmark international to optimize the debt structure of Lexmark international.
c) The remaining approximately US $77000000 (the “total amount of the first equity repurchase”) will be used for the Cayman joint venture to repurchase part of its equity from taimeng and Shuoda in a relative proportion (the “first equity repurchase”), provided that the phase I loan agreement is successfully delivered.
d) Based on the compound interest of 6% of the annual return on the principal of all the funds actually invested by taimeng and Shuoda (including equity and shareholder bonds), the price of the first equity repurchase is US $2617 per share, provided that the delivery is completed no later than February 28, 2022. If the delivery is later than this date, the total amount of the first equity repurchase will remain unchanged. In order to ensure the compound interest return of 6% of the annual return on the principal of all the funds actually invested by taimeng and Shuoda (including equity and shareholder bonds), the number of shares actually repurchased will be reduced accordingly.
2. Potential second equity repurchase
a) Ninestar Corporation(002180) shall use reasonable commercial efforts to promote the third-party investors to sign an additional loan agreement with the Cayman joint venture as soon as practical after the successful completion of the first phase loan agreement (the “second phase loan agreement”), with a target principal amount of US $178800000. However, Ninestar Corporation(002180) does not guarantee the successful delivery of the second phase loan and the achievement of the target principal amount.
b) After the successful closing of the phase II loan agreement, the Cayman joint venture will repurchase part of the remaining shares of taimeng and Shuoda in a relative proportion (“second equity repurchase”).
c) The price of potential second equity repurchase is still calculated based on the compound interest of 6% of the annual return on the principal of all funds actually invested by taimeng and Shuoda (including equity and shareholder bonds).
3. The third equity repurchase (“early partial put right”)
a) During the period from January 1, 2023 to March 31, 2023, taimeng has the right to exercise the early part of the put right on its remaining equity and require Ninestar Corporation(002180) to purchase the equity with the corresponding total amount of USD 75000000 (“taimeng early part of the put value”). If Shuoda chooses to exercise the early part of the sale right with taimeng in the same period, Shuoda has the right to require nastar to purchase the corresponding equity with a total amount of US $10.3 million (the “early part of the sale value of Shuoda”) from it in a relative proportion. “Early part sale value of taimeng” and “early part sale value of Shuoda” are collectively referred to as “total early part sale value”. If the total amount of funds loaned under the phase II loan agreement exceeds US $178800000, the excess will be deducted from the total amount of early sales.
b) The price per share of taimeng and Shuoda exercising the early part of the put right will be calculated according to the compound interest of 6% of the annual rate of return of the principal of all the funds actually invested by them (including share capital and shareholder bonds). If it is supported by the valuation of the third-party evaluation agency legally decided by the board of directors of the Cayman joint venture and approved by the majority of the board of directors of the Cayman joint venture, the compound interest of the above 6% can be adjusted to 10% at the highest.
4. As a condition precedent to the closing of the corresponding event, the shareholders of the Cayman joint venture shall take all necessary steps to enable the Cayman joint venture to repay the loan when the following events occur (the “mandatory repayment event”):
a) Lexmark International’s sale or initial public offering (“Lexmark strategic event”);
b) Change of control of the Cayman joint venture or its subsidiaries; or
c) Taimeng exercises the selling right under the shareholders’ agreement.
5. When the following events occur, which are related to the compulsory repayment event, or will directly or indirectly lead to the occurrence of the compulsory repayment event, as a condition for the completion of the settlement of the corresponding events, the loan shall be repaid:
a) Taimeng exercises the selling right or alternative selling right under the shareholders agreement;
b) Taimeng exercises the right of tag along sale under the shareholders agreement;
c) Taimeng exercises the above-mentioned first equity repurchase;
d) Taimeng exercises the above-mentioned early part of the selling right;
e) Shuoda elects to exercise the above-mentioned early part of the put right; or
f) Shuoda chooses to exercise the tag along right under the shareholders’ agreement.
6. Within 90 calendar days from the delivery date of the first phase loan agreement, taimeng and Shuoda shall not exercise the preemptive right, put right, alternative put right, early part put right, follow-up put right and lead put right, nor claim the second equity repurchase.
7. The agreements in Items 1 to 6 above shall come into force after the successful delivery of the first phase loan agreement.
8. The alternative put right originally agreed under the shareholders’ agreement, starting from the third anniversary (November 29, 2019) and finally the sixth anniversary (November 29, 2022) after the transaction settlement of the acquisition of Lexmark international, is extended to September 30, 2024.
The listed company agrees to the above proposed amendments and agrees to make amendments in accordance with the shareholders’ agreement and its provisions when necessary
This proposal needs to be submitted to the second extraordinary general meeting of shareholders of the company in 2022 for deliberation and approval.
5、 The proposal on convening the second extraordinary general meeting of shareholders in 2022 was considered and adopted by 9 votes in favor, 0 against and 0 abstention
The board of directors agreed that the company would hold the 2022 meeting on February 24, 2022 by combining on-site voting and online voting
