StockCode:000553(200553) StockAbbreviation:ADAMAA(B) NO.2019-9 ADAMALtd. AnnouncementonReceivingaNoticePriortoAdministrativePunishment (Hearing)andDecisionNoticeofProductionSuspensionandRectification TheCompanyandallmembersoftheCompany’sBoardofDirectorsconfirmthatallinformationdisclosedhereinistrue,accurateandcomplete,withnofalseormisleadingstatementormaterialomission. ADAMALtd.(hereinafterreferredtoasthe“Company”)receivedaNoticePriortoAdministrativePunishment(Hearing)andaDecisionNoticeofProductionSuspensionandRectificationissuedbytheLawEnforcementBureauofJingzhouEconomicandTechnologicalDevelopmentZone(hereinafterreferredtoasthe“Bureau”)onFebruary2,2019.Thefollowingisrelevantinformationinthisregard.I． MainContentsoftheTwoNotices 1.MainContentsoftheNoticePriortoAdministrativePunishment(Hearing) OnJanuary30thand31st,2019,theProvincialEnvironmentalInspectionTeam,togetherwithpersonnelfromitsmunicipalbranch,conductedaninspectionattheCompany’soldproductionsiteatNo.93,BeijingDongluRoad,JingzhouCity.Duringsuchinspection,theinspectorstookseveralsamples,someofwhichshowedelevatedlevelsofwaterpollutant,inexcessofdischargestandardsprescribedbytheStateintheproductionprocess. AccordingtotheNotice,onJanuary30th,2019,the"MonitoringReportbyJingzhouEnvironmentalProtectionMonitoringStation(Supervisory)(2019),FileNo.10"showedthatthetotalphosphorousatNo.2pumppoolofthewastewaterdischargereached5.32mg/L,exceededthemaximumallowableemissionlimitforthesecondcategoryofpollutantsinTable4oftheGeneralDischargeStandardofWastewater(GB8978-1996). BasedonItem2ofArticle83oftheLawonthePreventionandControlofWaterPollutionofthePeople'sRepublicofChina,theBureauintendstoimposean administrativepenaltyofafineofonemillionRMByuanfortheCompany’swastewaterdischargethatexceededthemaximumallowableemissionlimit. 2.MainContentsoftheDecisionNoticeofProductionSuspensionandRectificationTheallegedviolationintheDecisionNoticeofProductionSuspensionandRectificationisassameastheoneintheNoticePriortoAdministrativePunishment(Hearing)mentionedabove.Accordingtotheitem2ofArticle83oftheLawonthePreventionandControlofWaterPollutionofthePeople'sRepublicofChina,theBureauinstructedtheCompany: (1)tostopproductionimmediatelyattheoldsiteuponthereceiptofthedecisionnoticeandtakecorrectivemeasurestoformulateandimplementarectificationplan;(2)within15workingdaysafterreceivingthedecisionnotice,therectificationplanshouldbereportedtotheBureauforfilinganddisclosedtothepublic; (3)aftercompletingtherectification,theCompanyshouldreporttheachievementaswellasdiscloseinformationregardingtheprogressofrectificationtotheBureauforfilingwithin15workingdays. ThedecisionnoticeofproductionsuspensionandrectificationwillbeliftedonthedateonwhichtheabovefileissubmittedtotheBureau. II．MeasurestakenbytheCompany TheCompanyisdeeplycommittedtoenvironmentallysustainableproduction,hasastrongtrackrecordworldwideofcompliancewithrelevantregulations,andtakesseriouslyanypotentialinstanceofexceedingofemissionsthresholds.TheCompanyis,ofcourse,fullycooperatingwithallrelevantauthoritiesintheexecutionoftheirinspectionandhasalreadytakenspecificmeasuresasfollows: 1.Uponlearningofapotentialexceedingofanemissionsthreshold,theCompany immediatelyandvoluntarilydecidedtosuspendproductionattheoldsitein Jingzhou. 2.TheCompanysetupanenvironmentalemergencyresponseworkinggroupwhich includesseniormanagementandseniorexperts,fromChinaandglobally,to investigateandadvancerectification,andisdevotingallnecessaryresourcesto achievecompliancewithallrelevantlawsandregulationsandtoensurethesafe andenvironmentallysustainableoperationofthefacility. 3.TheCompanyhasalreadyputtogetheraproposedremediationplanwhichitis discussingwiththeauthorities.Onceitreceivestheapprovaloftheauthoritiesof theremediationplan,theCompanywillcompletetherectificationassoonas possibleandfiletheachievementsoftherectificationtotheauthorities. 4.SincethecombinationwhichbroughttheChinaassetsintotheglobalADAMA group,theCompanyhasbeenconductingacomprehensiveenvironmental self-examinationinthecourseofwhichitistakingsignificantactionandmaking investmenttoupgradealloperationsinChinaandachievebest-in-class environmentalstandards.Inthiscontext,inrecentyears,theCompanyhasalready invested$125millionintherelocationoftheJingzhouoldsite,andhasinstalled advancedproductionandenvironmentalfacilitiesatanewandalreadyoperational site,includinganinvestmentof$16millioninanew,state-of-the-artwastewater facility,whichisreadytocommenceoperation.TheCompanyiscommittedto augmentitseffortsinwhateverwaynecessarytorapidlybringitsChinese operationstothehighestinternationalstandard. III．ImpactontheCompany 1.NeithertheaforesaidviolationoftheCompanyiswithinthescopeofarticlestwo,fourandfiveoftheImplementingMeasuresoftheShenzhenStockExchangeforCompulsorilyDelistingListedCompanieswithMajorViolations,nordoesitconformtoitem7to9ofarticle13.2.1oftheListingRulesofShenzhenStockExchange. 2.BearinginmindthatSanonda’soldplantisnolongerthemainproductionassetoftheCompanytogetherwithitssubsidiaries,andgiventhattheglobalADAMAgrouphassignificantproductioncapabilitieselsewhereinChinaandworldwide,andassumingtherectificationprocessproceedsaccordingtotheplanbeingproposedbytheCompany,itdoesnotforeseeamaterialimpactofthesuspensiononitsoverallperformanceforthefinancialyear2019. TheCompanywillstrictlyfollowtherequirementsoftheListingRulesofShenzhen StockExchange,andtimelydisclosetherelevantinformation.Theinvestorsshallbeawareoftheinvestmentrisk. Itisherebyannounced. BoardofDirectorsoftheCompany February12,2019