Appotronics Corporation Limited(688007) : Announcement on the plan of repurchasing shares of the company by means of centralized bidding transaction

Securities code: Appotronics Corporation Limited(688007) securities abbreviation: Appotronics Corporation Limited(688007) Announcement No.: 2022021 Appotronics Corporation Limited(688007)

The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear legal responsibility for the authenticity, accuracy and integrity of its contents in accordance with the law. Important content tips:

Appotronics Corporation Limited(688007) (hereinafter referred to as “the company”) repurchase the company’s shares in the form of centralized bidding transaction. The main contents of the scheme are as follows:

1. Purpose of shares to be repurchased: the repurchased shares will be used for employee stock ownership plan or equity incentive at an appropriate time in the future, and will be transferred within three years after the implementation result of share repurchase and announcement of share change; If the company fails to use up the repurchased shares within three years after the implementation result of share repurchase and the announcement date of share change, the unused repurchased shares will be cancelled. If the state makes adjustments to relevant policies, the repurchase scheme shall be implemented according to the adjusted policies;

2. Repurchase scale: the total repurchase funds shall not be less than RMB 10 million (inclusive) and not more than RMB 20 million (inclusive);

3. Repurchase price: no more than 27 yuan / share (inclusive), which is no more than 150% of the average trading price of the company’s shares 30 trading days before the board of directors passed the repurchase resolution;

4. Repurchase period: within 6 months from the date when the general meeting of shareholders deliberates and approves the repurchase plan;

5. Source of repurchase funds: over raised funds.

● whether there is a reduction plan for relevant shareholders

Nantong Strait Guangfeng investment partnership (limited partnership), a shareholder holding more than 5% of the company’s shares, replied that up to now, there is no plan to reduce the company’s shares. If there is a subsequent reduction plan, it will fulfill the obligation of information disclosure in accordance with relevant regulations.

In addition to the above, the company’s controlling shareholders, actual controllers, repurchase proponents, other shareholders holding more than 5%, directors, supervisors and senior managers have no plans to reduce their shares in the company in the next three months and six months.

● relevant risk tips:

1. There is a risk that the stock price of the company continues to exceed the upper limit of the repurchase price during the repurchase period, resulting in the failure to implement the repurchase plan smoothly;

2. In case of major events that have a significant impact on the trading price of the company’s shares, or major changes in the company’s production and operation, financial conditions and external objective conditions, or other events that lead to the decision of the board of directors to terminate the repurchase plan, there is a risk that the repurchase plan cannot be implemented smoothly or the repurchase plan can be changed or terminated according to relevant regulations;

3. The repurchased shares of the company are intended to be used for employee stock ownership plan or equity incentive at an appropriate time in the future. If the company fails to implement the above purpose within the time limit specified by laws and regulations, there is a risk of starting the cancellation procedure of non transferred shares;

4. If the regulatory authorities issue new normative documents related to repurchase, it may lead to the risk that the corresponding terms of repurchase need to be adjusted according to the new regulatory regulations during the implementation of this repurchase.

During the repurchase period, the company will choose the opportunity to make the repurchase decision and implement it according to the market conditions, and fulfill the obligation of information disclosure in time according to the progress of the repurchase of shares.

1、 Review and implementation procedures of repurchase plan

(I) on March 18, 2022, the company held the ninth meeting of the second board of directors, deliberated and adopted the proposal on the scheme of repurchasing the company’s shares by means of centralized bidding transaction. All directors of the company attended the meeting and adopted the proposal with 6 affirmative votes, 0 negative votes and 0 abstention. The independent directors expressed their independent opinions on this matter.

(II) in accordance with the Appotronics Corporation Limited(688007) articles of Association (hereinafter referred to as the “articles of association”) and the self regulatory guidelines for companies listed on the science and Innovation Board of Shanghai Stock Exchange No. 1 – standardized operation, this repurchase shall be submitted to the general meeting of shareholders of the company for deliberation.

(III) on March 18, 2022, the controlling shareholder of the company, Shenzhen Guangfeng Holding Co., Ltd. (hereinafter referred to as “controlling shareholder” or “Guangfeng holding”) proposed to buy back the company’s shares to the board of directors of the company. The proposal is to propose that the company repurchase part of the issued RMB common shares (A shares) of the company through the trading system of Shanghai stock exchange with over raised funds through centralized bidding trading. For details, please refer to the website of Shanghai Stock Exchange (www.sse. Com. CN.) on March 21, 2022 Announcement of Appotronics Corporation Limited(688007) on the proposal of the controlling shareholder of the company to repurchase shares of the company (Announcement No.: 2022020) disclosed on the. On March 18, 2022, the company held the ninth meeting of the second board of directors to consider the above share repurchase proposal. The meeting deliberated and adopted the proposal on the share repurchase scheme of the company by means of centralized bidding transaction with 6 affirmative votes, 0 negative votes and 0 abstention votes. The independent directors of the company expressed their independent opinions on the share repurchase.

The above-mentioned proposal time and procedures, as well as the deliberation time and procedures of the board of directors, comply with the relevant provisions of the self regulatory guidelines for listed companies of Shanghai Stock Exchange No. 7 – share repurchase and so on.

2、 Main contents of repurchase plan

(I) purpose and purpose of the company’s share repurchase

Based on the confidence in the company’s future development prospects and high recognition of the company’s value, in order to enhance investors’ confidence in the company, safeguard the interests of the majority of investors, and on the basis of the company’s operation, main business development prospects, financial status and future profitability, the company plans to repurchase the company’s shares with over raised funds, and use the repurchased shares for employee stock ownership plan or equity incentive at an appropriate time in the future, In order to further improve the corporate governance structure, build an innovative long-term incentive and restraint mechanism for the shareholding of the management team, ensure the realization of the company’s long-term business objectives, promote the consistency of interests and income sharing of all shareholders, and enhance the overall value of the company.

(II) types of shares to be repurchased

RMB ordinary shares (A shares) issued by the company.

(III) method of share repurchase

Centralized bidding transaction method.

(IV) repurchase period

Within 6 months from the date when the repurchase plan is considered and approved by the general meeting of shareholders. During the implementation of the repurchase, if the trading of the company’s shares is suspended for more than 10 consecutive trading days due to the planning of major events, the repurchase plan will be postponed and disclosed in time after the resumption of trading.

If the following conditions are met, the repurchase period will expire in advance:

1. If the use amount of repurchase funds reaches the upper limit within the repurchase period, the implementation of the repurchase plan is completed, and the repurchase period expires in advance from that date.

2. If the board of directors of the company decides to terminate the repurchase plan, the repurchase period shall expire in advance from the date when the board of directors decides to terminate the repurchase plan.

3. The company shall not repurchase shares during the following periods:

(1) If the announcement date is delayed due to special reasons within 10 trading days before the annual report, semi annual report and quarterly report of the listed company, it shall be calculated from 10 trading days before the original scheduled announcement date to the day before the announcement;

(2) Within 10 trading days before the announcement of the performance forecast or performance express of the listed company;

(3) From the date of occurrence of major events that may have a great impact on the trading price of the company’s shares or in the process of decision-making to the date of disclosure according to law;

(4) Other circumstances prescribed by the CSRC and the Shanghai Stock Exchange.

(V) purpose, total capital, quantity and proportion of the shares to be repurchased in the total share capital of the company

The shares repurchased this time will be used for employee stock ownership plan or equity incentive at an appropriate time in the future, and will be transferred within three years after the completion of the repurchase. If the company fails to use up the repurchased shares within three years after the implementation result of share repurchase and the announcement date of share change, the unused repurchased shares will be cancelled. If the state makes adjustments to relevant policies, the repurchase plan shall be implemented according to the adjusted policies.

Total repurchase funds: no less than 10 million yuan (inclusive) and no more than 20 million yuan (inclusive).

Number of shares repurchased: Based on the current total share capital of 452756901 shares of the company, calculated according to the upper limit of the repurchase amount of 20 million yuan and the upper limit of the repurchase price of 27.00 yuan / share, the number of shares repurchased this time is 740700 shares, accounting for 0.16% of the total share capital of the company. According to the calculation of the lower limit of the repurchase amount of RMB 10 million and the upper limit of the repurchase price of RMB 27.00/share, the number of the repurchase is 370400 shares, accounting for 0.08% of the total share capital of the company.

The specific repurchase quantity and proportion in the total share capital of the company shall be subject to the actual repurchase situation of the company when the repurchase is completed or the repurchase implementation period expires. If the company implements ex rights and ex interests matters such as conversion of capital reserve into share capital, distribution of stock dividends, stock subdivision, stock reduction or allotment during the repurchase period, the company will adjust the number of repurchased shares accordingly in accordance with the relevant provisions of China Securities Regulatory Commission and Shanghai Stock Exchange.

(VI) repurchase price

The price of the shares repurchased this time shall not exceed 27 yuan / share (inclusive), and the price shall not be higher than 150% of the average trading price of the company’s shares 30 trading days before the board of directors adopted the repurchase resolution. The specific repurchase price shall be submitted to the general meeting of shareholders to authorize the management of the company to determine the stock price in the secondary market during the implementation of the repurchase. If the company has implemented ex rights and ex interest matters such as conversion of capital reserve into share capital, cash dividends, distribution of stock dividends, allotment of shares, stock subdivision or stock reduction during the repurchase period, the company will adjust the upper limit of repurchase price accordingly in accordance with the relevant provisions of China Securities Regulatory Commission and Shanghai Stock Exchange.

(VII) total amount and source of funds of this repurchase

The total amount of funds for this repurchase is no less than RMB 10 million (inclusive) and no more than RMB 20 million (inclusive). The source of funds is the over raised funds of the company.

For details on the deposit and use of the company’s raised funds, see the company’s disclosure on the website of Shanghai Stock Exchange (www.sse. Com. CN.) on August 25, 2021 Special report on the deposit and use of raised funds in the half year of 2021 (Announcement No.: 2021066).

The total amount of over raised funds (including interest income) of the company is RMB 667551 million. The maximum amount to be used for share repurchase this time is RMB 20 million, which does not exceed 30% of the total amount of over raised funds, and does not violate the relevant provisions of China Securities Regulatory Commission and Shanghai Stock Exchange on the use of raised funds of listed companies.

(VIII) expected changes in the company’s equity structure after repurchase

The total capital of the company’s share repurchase this time shall not be less than RMB 10 million (inclusive) and not more than RMB 20 million (inclusive). If the upper limit of the repurchase price is 27.00 yuan / share, assuming that all the repurchased shares are used for employee stock ownership plan or equity incentive and locked up, the changes in the company’s equity structure are expected to be as follows:

Before the repurchase, the shares shall be repurchased according to the upper limit of the repurchase amount and after the shares are repurchased according to the lower limit of the repurchase amount

Number of shares in total share capital number of shares in total share capital number of shares in total share capital proportion (%) (share) proportion (%) (share) proportion (%)

Restricted sale 16673676636.8316747750636.9916710713636.91 conditional tradable shares

Unlimited sale of 28602013563.1728527939563.0128564976563.09 conditional tradable shares

Total share capital 452756901100.00452756901100.00452756901100.00

Note: the above changes do not take into account the impact of other factors. The above calculation data are for reference only. The specific number of shares repurchased and the actual changes in the company’s equity structure shall be subject to the subsequent implementation.

(IX) analysis of the possible impact of this share repurchase on the company’s daily operation, finance, R & D, profitability, debt performance, future development and maintaining its listing status

1. The implementation of share repurchase has little impact on the daily operation of the company. As of December 31, 2021 (Unaudited), the total assets of the company are 4097614900 yuan, and the net assets attributable to the shareholders of the listed company are 2432971500 yuan. According to the calculation of the maximum repurchase fund of 20 million yuan, accounting for 0.49% and 0.82% of the above financial data respectively. According to the repurchase plan, the source of repurchase funds is over raised funds and will be paid at an appropriate time within the repurchase period. Combined with the company’s future operation and R & D planning, the company believes that the repurchase shares will not have a significant impact on the company’s operation, finance, R & D and future development, and the company is able to pay the repurchase price;

2. The share repurchase has little impact on the company’s solvency. As of December 31, 2021 (Unaudited), the overall asset liability ratio of the company is 36.12%. The share repurchase will not have a significant impact on the company’s solvency;

3. The repurchased shares are intended to be used for the company’s employee stock ownership plan or equity incentive, which is conducive to improving team cohesion, R & D ability and the company’s core competitiveness, improving the company’s business performance in the future and promoting the company’s long-term, healthy and sustainable development. After the completion of share repurchase, the company will not change its control

(x) opinions of independent directors on compliance, necessity, rationality and feasibility of the share repurchase scheme

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