Ningbo Xianfeng New Material Co.Ltd(300163) : Notice on the risk of compulsory closing and passive reduction of some shares held by controlling shareholders and actual controllers

Securities code: Ningbo Xianfeng New Material Co.Ltd(300163) securities abbreviation: Ningbo Xianfeng New Material Co.Ltd(300163) Announcement No.: 2022015 Ningbo Xianfeng New Material Co.Ltd(300163)

Some shares held by controlling shareholders and actual controllers are forced to close

And risk suggestive announcement of passive reduction

The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.

Ningbo Xianfeng New Material Co.Ltd(300163) (hereinafter referred to as “the company”) recently inquired at Shenzhen Branch of China Securities Depository and Clearing Corporation Limited (hereinafter referred to as “csdct Shenzhen company”) and learned that there is a passive reduction risk in some Pledged Shares held by Mr. Lu Xianfeng, the controlling shareholder and actual controller of the company. Now the relevant information is announced as follows:

1、 Shareholding and pledge of shareholders

Mr. Lu Xianfeng, the controlling shareholder and actual controller of the company, and the persons acting in concert held 115213503 shares of the company, accounting for 24.31% of the total share capital of the company, of which Lu Xianfeng personally held 104924203 shares, accounting for 22.14% of the total share capital of the company.

Up to now, Lu Xianfeng has pledged 87582380 shares, accounting for 83.47% of the total shares of the company and 18.48% of the total share capital of the company, including 37.38 million shares pledged to Kyushu Securities Co., Ltd. (hereinafter referred to as “Kyushu securities”), accounting for 7.89% of the total share capital of the company. The shares held by Lu Xianfeng’s persons acting in concert are not pledged.

2、 Reasons why shareholders’ shares may be forced to close

On December 7, 2016, Kyushu Securities Co., Ltd. (hereinafter referred to as “Kyushu securities”) as the asset management plan manager signed the stock pledge type repurchase transaction business agreement with Mr. Lu Xianfeng, and subsequently signed the supplementary pledge agreement, extended repurchase agreement and partial de pledge. The latest extended repurchase agreement signed by both parties agreed that the repurchase period shall be September 30, 2020, The total number of Pledged Shares is 37.38 million. Up to now, the pledge has expired, and Mr. Lu Xianfeng has failed to repurchase as scheduled.

After checking the information on the shareholding change of major shareholders issued by China Securities Registration Shenzhen company, the Pledged Shares have been transferred to the pledge special trading unit, and the pledgee has the right to dispose of their breach of contract at any time. The disposal methods include:

Centralized bidding and block trading. The above default disposal may lead to the passive reduction of Mr. Lu Xianfeng’s 37.38 million Pledged Shares.

After learning of the above situation, Lu Xianfeng has actively communicated with Kyushu securities and learned that Kyushu securities, as the manager of the asset management plan, has returned all the corresponding creditor’s rights and other relevant interests and assets under the pledge, as well as the status quo of the rights and obligations that have not been fulfilled to Hua’an tairun information technology (Beijing) Co., Ltd. (hereinafter referred to as “Hua’an tairun”), and the disposal of this breach, Kyushu securities no longer has any rights, obligations and relevant responsibilities, and the relevant disposal and liquidation information (including but not limited to the number of shares disposed, the amount disposed, the time of disposal, etc.) shall be subject to the information sent by China Antai resources; Lu Xianfeng actively contacted with China Antai resources and learned that Lu Xianfeng failed to fulfill his repayment obligations due to the expiration of the pledge period. Therefore, China Antai resources started the default disposal procedure. During the disposal process, it will independently choose the way (such as secondary market, block trading, etc.), price, quantity, timing and order of selling the Pledged Shares. The number of shares to be disposed of shall not exceed 37.38 million until all debts owed by Lu Xianfeng are paid off, Hua’an tairun will notify Lu Xianfeng of the specific disposal in accordance with the requirements of laws and regulations. The company will keep close communication with Mr. Lu Xianfeng. If there is progress, the company will disclose it in time in strict accordance with the requirements of relevant laws, regulations and normative documents.

3、 Risk tips

1. The disposal of pledged stocks may be affected by factors such as capital market conditions, the company’s share price and Lu Xianfeng’s response measures, and the reduction time, reduction price, reduction quantity and reduction method are uncertain;

2. The disposal of pledged default shares still needs to comply with the principle that within any continuous 90 natural days, the reduction through centralized bidding trading shall not exceed 1% of the total share capital of the company, and the reduction through block trading shall not exceed 2% of the total share capital of the company. The company has urged relevant parties to reduce their holdings in accordance with laws and regulations.

3. Mr. Lu Xianfeng’s possible passive reduction will not have a direct impact on the company’s production, operation and management temporarily; If the passive reduction of shares is maximized, Lu Xianfeng’s personal shareholding ratio will be reduced to 14.25% and his personal shareholding pledge ratio will be reduced to 74.33%. This passive reduction will not lead to the change of control of the company for the time being.

4. The remaining 50202380 shares pledged by Mr. Lu Xianfeng have expired. At present, the possibility of default disposal by other pledgees is not ruled out. If other pledgees subsequently file default disposal, Lu Xianfeng will lose control of the company. The company will keep close communication with Mr. Lu Xianfeng. If there is progress, the company will disclose it in time in strict accordance with the requirements of relevant laws, regulations and normative documents.

5. As of the date of this announcement, the company has not received the information disclosure documents such as the stock reduction plan and the simplified equity change report submitted by Lu Xianfeng, This passive reduction may not comply with the relevant provisions of the Shenzhen Stock Exchange GEM Listing Rules, several provisions on the reduction of shares held by shareholders, directors, supervisors and senior managers of listed companies, and the implementation rules for the reduction of shares held by shareholders, directors, supervisors and senior managers of listed companies on the Shenzhen Stock Exchange.

6. The company will pay close attention to the changes of Lu Xianfeng’s shareholding, timely do a good job in relevant information disclosure, and try its best to urge shareholders to abide by the information disclosure rules and bear due responsibility for information disclosure.

Please invest rationally and pay attention to risks.

4、 Documents for future reference

1. List of daily shareholding changes of shareholders holding more than 5% of shares of China Securities Depository and Clearing Co., Ltd; 2. Details of daily shareholding changes of shareholders holding more than 5% of shares of China Securities Depository and Clearing Co., Ltd; 3. Detailed statement of securities pledge and judicial freezing of China Securities Depository and Clearing Co., Ltd.

It is hereby announced.

Ningbo Xianfeng New Material Co.Ltd(300163) board of directors April 17, 2022

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