China Baoli Tec (00164) announced that, as stated in the annual report as of March 31, 2024, the amount of unsecured debts payable to Chongqing Zifeng, totaling RMB 0.138 billion yuan (equivalent to HKD 0.1477 billion yuan) with interest calculated based on the benchmark interest rate of the People's Bank of China, has expired on March 27, 2019. After an agreement, on April 11, 2024, the group (including the company and Chongqing Baoli Youte) reached a settlement agreement with Chongqing Zifeng. The company, Chongqing Baoli Youte and Chongqing Zifeng agreed to issue convertible bonds to Chongqing Zifeng for the agreed amount, including the approval of the Chongqing First Intermediate People's Court (Chongqing Court). On August 13, 2024, the group received an execution ruling from the Chongqing Court for the execution of the settlement agreement.

The convertible bond has a principal amount of RMB 0.128 billion yuan (equivalent to approximately HKD 0.139 billion yuan) calculated by exchange rate. If all convertible rights are exercised, the company will issue and distribute a total of 11.6786 million shares of convertible stock at a preliminary conversion price of HKD 11.9024 per share, which is equivalent to approximately 11.99% of the total existing issued shares as of the date of this announcement; and the total number of issued shares after the distribution and issuance of convertible shares will be increased by approximately 10.70% (assuming that there is no other change in the total number of issued shares from the date of this announcement to the date when all convertible bonds are converted and the total number of issued shares). The initial conversion price of HKD 11.9024 per share represents a premium of approximately 2,025.43% compared to the closing price of HKD 0.560 per share reported by the Stock Exchange on the date of this announcement, and a premium of approximately 1,807.44% compared to the average closing price of HKD 0.624 per share reported by the Stock Exchange for the last five consecutive trading days immediately before the date of this announcement.

The preliminary exchange price for each share is HKD 11.9024, which represents a premium of approximately 2025.43% over the closing price of HKD 0.560 per share reported by the Stock Exchange on the date of this announcement, and a premium of approximately 1807.44% over the average closing price of HKD 0.624 per share reported by the Stock Exchange for the last five consecutive trading days prior to the date of this announcement.