Proposed placing of non-listed warrants under specific mandate

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement is for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities of the Company.

CHINA RUIFENG RENEWABLE ENERGY HOLDINGS LIMITED ʕ਷๿ࠬอঐ๕છٰϞࠢʮ̡

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 00527)

PROPOSED PLACING OF NON-LISTED WARRANTS

UNDER SPECIFIC MANDATE

Placing Agent

Зࡋ⳪暲

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THE WARRANT PLACING AGREEMENT

On 3 March 2021 (after trading hours), the Company entered into the Warrant Placing Agreement with the Placing Agent in connection with the Warrant Placing, pursuant to which the Placing Agent has agreed to place, on a best effort basis, up to 395,828,160 Warrants conferring rights to subscribe for up to 395,828,160 Warrants Share at the initial Warrant Exercise Price of HK$0.205 per Warrant Share (subject to adjustment) to the Warrant Placee(s) who and whose ultimate beneficial owner(s) (if applicable) are Independent Third Parties. Each Warrant carries the right to subscribe for one Warrant Share.

The Warrants are to be placed at HK$0.015 each. The Warrant Placing is conditional upon several conditions as set out in the paragraph headed "Conditions of the Warrant Placing" in this announcement.

Assuming full exercise of the Subscription Rights attaching to the 395,828,160 Warrants at the initial Warrant Exercise Price of HK$0.205 per Warrant Share, a maximum of 395,828,160 Warrant Shares will be allotted and issued, representing approximately 20.00% of the existing issued share capital of the Company as at the date of this announcement; and approximately 16.67% of the issued share capital of the Company as enlarged by the allotment and issue of the 395,828,160 Warrant Shares.

The Subscription Rights attaching to the Warrants will be exercisable within eighteen (18) months from the date of the issue of the Warrants.

Assuming the maximum number of the Warrants are placed at the Warrant Placing Price, the gross proceeds and net proceeds from the issue of the Warrants will be approximately HK$5,900,000 and HK$5,630,000, respectively. Assuming the full exercise of the Subscription Rights attaching to the maximum number of Warrants at the initial Warrant Exercise Price, it is expected up to an additional of approximately HK$81,100,000 will be raised.

The aggregate net proceeds from the Warrant Placing and the allotment and issue of the Warrant Shares of up to approximately HK$86,730,000 are expected to be used for general working capital, future business development and potential acquisition of the Group as and when opportunities arise but no specific investment targets have been identified yet as at the date of this announcement.

The Company will apply to the Stock Exchange for the listing of, and permission to deal in, the Warrant Shares which may fall to be allotted and issued upon exercise of the Subscription Rights attaching to the Warrants. No listing of the Warrants will be sought on the Stock Exchange or any other stock exchanges.

SPECIFIC MANDATE

The Warrant Shares to be allotted and issued upon exercise of the Subscription Rights attaching to the Warrants will be allotted and issued pursuant to the Specific Mandate. The Company will seek the grant of the Specific Mandate at the EGM.

GENERAL

The EGM will be convened and held to consider and, if thought fit, pass the requisite resolution(s) to approve, among other things, the Warrant Placing Agreement and the transactions contemplated thereunder including the issue of the Warrants and the Specific Mandate for the allotment and issue of the Warrant Shares. A circular containing, among other things, further details relating to the Warrant Placing Agreement and the notice of EGM will be despatched to the Shareholders as soon as practicable in accordance with the Listing Rules.

THE WARRANT PLACING AGREEMENT

Below is a summary of the principal terms of the Warrant Placing Agreement:

Date

3 March 2021 (after trading hours)

Parties

Warrant Placing commission

The Placing Agent will charge the Company a placing commission in a fixed sum of HK$150,000 plus any other out-of-pocket charges and expenses by the Placing Agent in relation to the Warrant Placing in accordance with the Placing Agreement. The Warrant Placing commission was negotiated on arm's length basis between the Company and the Placing Agent with reference to the prevailing market rate. The Directors consider that the terms of the Warrant Placing, including the Warrant Placing commission, are fair and reasonable based on the current market conditions and Warrant Placing is in the interests of the Company and the Shareholders as a whole.

Warrant Placees

To the best information, belief and knowledge of the Directors, it is contemplated that there will be not less than six Warrant Placees who and whose ultimate beneficial owners (if applicable) are Independent Third Parties. In the event that there will be less than six (6) Warrant Placees, the Company will make further announcement in accordance with the Listing Rules requirements.

Number of Warrants

Up to 395,828,160 Warrants, each Warrant carries the right to subscribe for one (1) Warrant Share.

Exercise Period

The Subscription Rights attaching to the Warrants may be exercised at any time during the period of eighteen (18) months commencing from the date immediately after the date of issue of the Warrant.

Placing Price

The Placing Price is HK$0.015 for each Warrant. The Warrant Placing Price is determined after arm's length negotiations between the Company and the Placing Agent with reference to the current market conditions, the Group's financial positions and the historical share prices and liquidity of the Shares in the market. The Directors consider that the Warrant Placing Price is fair and reasonable and in the interests of the Shareholders and the Company as a whole.

Warrant Exercise Price

The initial Warrant Exercise Price is HK$0.205 per Warrant Share, subject to following adjustment:

(i) an alteration of the nominal amount of each Share by reason of any consolidation or sub-division of the Shares;

• (ii) an issue (other than in lieu of a cash dividend) by the Company of Shares credited as fully-paid by way of capitalisation of profits or reserves (including any share premium account or capital redemption reserve fund);

• (iii) a capital distribution being made by the Company to holders of the Shares or grant to such holders rights to acquisition of cash assets of the Group;

• (iv) an offer of new Shares for subscription by way of rights or a grant of options or warrants to subscribe for new Shares at a price which is less than 90% of the market price as at the date of the related announcement;

• (v) an issue wholly for cash or any securities convertible into or exchangeable for or carry rights of subscription for new Shares being made by the Company or any of its subsidiaries, and in any case the total effective consideration per Share is less than 90% of the market price as at the date of the related announcement, or the conversion, exchange or Subscription Rights of any such issue are altered so that the said total effective consideration is less than 90% of market price as at the date of the related announcement; and

(vi) an issue of Shares being made wholly for cash at a price per Share which is less than 90% of the market price at the date of the related announcement.

The initial Warrant Exercise Price of HK$0.205 per Warrant Share represents (i) a premium of approximately 15.82% over the closing price of HK$0.177 per Share as quoted on the Stock Exchange on the Last Trading Day; and (ii) a premium of approximately 13.26% over the average closing prices of HK$0.181 per Share as quoted on the Stock Exchange for the five consecutive Trading Days immediately prior to (but excluding) the Last Trading Day.

The aggregate of the Warrant Placing Price and the Warrant Exercise Price, i.e. HK$0.22 per Warrant Share, represents (i) a premium of approximately 24.29% over the closing price of HK$0.177 per Share as quoted on the Stock Exchange on the Last Trading Day; and (ii) a premium of approximately 21.55% over the average closing prices of HK$0.181 per Share as quoted on the Stock Exchange for the five consecutive Trading Days immediately prior to (but excluding) the Last Trading Day.

Both the Warrant Placing Price and the Warrant Exercise Price are determined after arm's length negotiation between the Company and the Placing Agent with reference to the current market conditions, the Group's financial position, the historical Share prices and liquidity of the Shares in the market. The Directors consider that the Warrant Placing Price and the Warrant Exercise Price are fair and reasonable.

Completion Date

Completion of the Warrant Placing is expected to take place on the fourth (4th) Business Day after the day on which the Conditions have been fulfilled (or such later time or date as the Company and the Placing Agent shall agree in writing) on which completion of the Warrant Placing shall take place pursuant to the Warrant Placing Agreement.

Information of the Warrants

The Warrants will be allotted and issued pursuant to the Warrant Placing Agreement free from all Liens and equities and will rank pari passu in all respects with the Shares in issue and in particular will have the right to receive all dividends or other distributions hereafter declared paid or made on such Shares with reference to a record date occurring on or after the Completion. The Subscription Rights attaching to the Warrants may be exercised at any time during the period of eighteen (18) months commencing from the date immediately after the date of issue of the Warrant.

Provided that the public float of the Shares shall not be less than 25% (or any given percentage as required by the Listing Rules) of the issued Shares at any one time in compliance with the Listing Rules and the holder(s) of the Warrant will not become a substantial Shareholder as a result of the exercise of the Warrants, each one (1) Warrant carries the right to subscribe for one (1) Warrant Share at the Warrant Exercise Price and is issued at the Warrant Placing Price.

Pursuant to Rule 15.02(1) of the Listing Rules, the Warrant Shares to be issued upon exercise of the Warrants must not, when aggregated with all other equity securities to be issued on exercise of any other Subscription Rights, if all such rights were immediately exercised, whether or not such exercise is permissible, exceed 20.00% of the total number of issued shares of the Company at the time the Warrants are issued. Options granted under employee or executive share schemes which comply with Chapter 17 of the Listing Rules are excluded for the purpose of such limit. As at the date of this announcement, the Company has no outstanding warrant.

A total of up to 395,828,160 Warrants are proposed to be issued. Upon full exercise of the Subscription Rights attaching to the Warrants at the initial Warrant Exercise Price, a total of up to 395,828,160 Warrant Shares will be issued, representing (i) 20.00% of the total number of issued shares of the Company as at the date of this announcement; and (ii) approximately 16.67% of the total number of issued shares of the Company as enlarged by the allotment and issue of the Warrant Shares upon full exercise of the Subscription Rights attaching to the Warrants assuming there being no other changes in the issued share capital of the Company.

Transferability

The Warrants may, subject to the provisions of the terms and conditions of the Warrants and the Listing Rules, be transferred to any person. The Warrants may not be assigned or transferred to a connected person of the Company without prior written consent of the Company.

Conditions of the Warrant Placing Agreement

Completion of the Warrant Placing is conditional on, among the other matters, the fulfillment of the following conditions on or before the Long Stop Date:

• (i) the Shareholders shall have passed the requisite resolution(s) at the general meeting approving the Warrant Placing Agreement and the transactions contemplated thereunder including the issue of the Warrants and the Specific Mandate for allotment and issue of the Warrant Shares;

• (ii) the listing of and permission to deal in all the Warrant Shares being granted (subject only to allotment) by the Listing Committee of the Stock Exchange in principle and dealings of the Warrant Shares being allowed by the Stock Exchange (and such listing and permission not subsequently being revoked);

• (iii) all necessary consents and approvals to be obtained on the part of each of the Placing Agent and the Company in respect of the Warrant Placing Agreement and the transactions contemplated thereunder having been obtained;

• (iv) all necessary consents and approvals to be obtained on the part of each of the Warrant Placee in respect of the subscription of the Warrants and the terms and conditions contemplated thereunder having been obtained; and

• (v) no relevant government, governmental, quasi-governmental, statutory or regulatory body, court or agency having granted any order or made any decision that would make the Warrant Placing void, unenforceable or illegal, or restrict or prohibit the implementation of, or impose any additional material conditions or obligations with respect to the Warrant Placing (other than such orders or decisions as would not have a material adverse effect on the legal ability of the Company to proceed with the Warrant Placing).

In the event that, any of the above condition is not fulfilled by the Long Stop Date, the Warrant Placing Agreement will lapse. The obligations and liabilities of the Company under the Warrant Placing shall be null and void and the Company shall be released from all rights and obligations pursuant to the Warrant Placing.

Voting rights for the holders of the Warrants

The holders of the Warrants will not have any right to attend or vote at any meeting of the Company by virtue of them being the holders of the Warrants. The holders of the Warrants shall not have the right to participate in any distributions and/or offers of further securities made by the Company.

Rights of the holders of the Warrants on the liquidation of the Company

If the Company is wound up before the end of Exercise Period, all exercise rights which have not been exercised prior to the commencement of the winding-up shall lapse and the Warrants will cease to be valid for the purpose of exercising any exercise rights.

Specific Mandate to issue the Warrant Shares

The Warrant Shares to be allotted and issued upon exercising of the Subscription Rights attaching to the Warrants will be allotted and issued pursuant to the Specific Mandate. The Company will seek the grant of the Specific Mandate at the EGM.

Application for listing

The Company will apply to the Stock Exchange for the listing of, and permission to deal in, the Warrant Shares which may fall to be allotted and issued upon exercise of the Subscription Rights attaching to the Warrants. No listing of the Warrants will be sought on the Stock Exchange or any other stock exchanges.

REASONS FOR THE WARRANT PLACING

The Group is principally engaged in the business of wind farm operation and is continuing to search for investment opportunities in the energy sectors.

The Board considers that the Warrant Placing represents good opportunities to raise additional funds for the Group while broadening the Shareholder base and capital base of the Company. In addition, the Warrants are not interest bearing and the Warrant Placing will not be resulted in any immediate dilution effect on the shareholding of the existing Shareholders. In addition to the net proceeds that will be raised upon completion of the Warrant Placing, further capital will be raised upon the exercise of the Subscription Rights attaching to the Warrants by the holders thereof during the Exercise Period.

The Board considers that the terms of the Warrant Placing Agreement, are on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

USE OF PROCEEDS

Assuming the maximum of the Warrants are placed at the Warrant Placing Price, the gross proceeds and net proceeds from the issue of the Warrants will be approximately HK$5,900,000 and HK$5,630,000, respectively. Accordingly, the net price per Warrant would be approximately HK$0.014. Assuming the full exercise of the Subscription Rights attaching to the maximum number of Warrants at the initial Warrant Exercise Price, it is expected up to an additional of approximately HK$81,100,000 will be raised. The aggregate net proceeds of up to approximately HK$86,730,000 is expected to be used for general working capital, future business development and potential acquisition of the Group as and when opportunities arise but no specific investment targets have been identified yet as at the date of this announcement.

EQUITY FUND RAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Group has not conducted any equity fund raising activities in the past twelve months before the date of this announcement.

SHAREHOLDING STRUCTURE

As at the date of this announcement, the Company has 1,979,140,800 Shares in issue. The shareholding structure of the Company (i) as at the date of this announcement; and (ii) immediately after full exercise of the Subscription Rights attaching to the Warrants (assuming that there will be no further changes in the issued share capital of the Company prior to such exercise) are as follows:

ShareholdersAs at the date of this announcement

Immediately after the full exercise of the Subscription Rights attaching to the Warrants

Number of

%

Number of

%shares (approximately)shares (approximately)

As at the date of this announcement Number of shares and underlying % shares (approximately)

Immediately after the full exercise of the Subscription Rights attaching to the Warrants

Number of shares and underlying % shares (approximately)

Zhang Zhixiang ("Mr. Zhang")

(Notes 1, 2 and 3)

• - Diamond Era Holdings Limited

  (Note 2)

  448,910,325 448,910,325

  22.68% 22.68%

  448,910,325 448,910,325

  • 18.90% 1,087,942,956

  38.58% 1,087,942,956 33.83%

  18.90%

• - Filled Converge Limited

(Note 3)

-

-

-

-

448,910,325 619,332,631

15.92% 21.96%

448,910,325 13.96%

619,332,631 19.26%

Other Directors, save as Mr. Zhang, who were the grantees of the share options scheme of the Company adopted on 1 June 2015 (Note 4)

-

-

-

-

51,300,000

1.82%

51,300,000 1.60%

Public Shareholders Warrant Placees

Well Foundation (Note 5)

- -

• - 395,828,160

-

-

16.67% -

- 41,288,421

- 1.46%

395,828,160 12.31%

41,288,421 1.28%

Other grantees under the share option scheme of the Company adopted on 1 June 2015 (Note 6)

-

-

-

-

108,900,000

3.86%

108,900,000 3.39%Other public ShareholdersTotal

1,530,230,475 1,979,140,800

77.32%

100.00%

1,530,230,475 2,374,968,960

• 64.43% 1,530,230,475

  54.27%

  1,530,230,475 47.59%

• 100.00% 2, 819,661,852

100.00%

3,215,490,012 100.00%

Notes:

• 1. Mr. Zhang, an executive Director, holds 19,700,000 share options granted by the Company under the share option scheme of the Company on 29 January 2021. For further details, please refer to the

• announcement of the Company dated 29 January 2021.

• 2. Diamond Era Holdings Limited, which is beneficially and wholly-owned by Mr. Zhang, an executive Director, holds 448,910,325 Shares. Mr. Zhang is deemed, or taken to be, interested in the Shares in which Diamond Era Holdings Limited is interested for the purpose of the SFO.

• 3. Filled Converge Limited, which is beneficially and wholly-owned by Mr. Zhang, an executive Director, holds convertible bonds issued by the Company on 25 March 2019. Assuming the conversion right of such convertible bonds were exercised in full, the total of 619,332,631 new Shares will be issued to Filled Converge Limited. Mr. Zhang is deemed, or taken to be, interested in the Shares in which Filled Converge Limited is interested for the purpose of the SFO.

• 4. 51,300,000 share options of the Company were granted to the Directors, save as Mr. Zhang under the share option scheme of the Company adopted on 1 June 2015. For further details, please refer to the

• announcement of the Company dated 29 January 2021.

• 5. Well Foundation, which is an Independent Third Party, holds the convertible bonds issued by the Company on 25 March 2019. Assuming the conversion right of such convertible bonds were exercised in full, the total of 41,288,421 new Shares will be issued to Well Foundation.

• 6. 108,900,000 share options of the Company were granted to other grantees under the share option scheme of the Company adopted on 1 June 2015. None of such grantees is a Director, chief executive of the Company or substantial shareholder nor an associate (as defined in the Listing Rules) of any of them. For further details, please refer to the announcement of the Company dated 29 January 2021.

GENERAL

The EGM will be convened and held to consider and, if thought fit, pass the requisite resolution(s) to approve, among other things, the Warrant Placing Agreement and the transactions contemplated thereunder including the issue of the Warrants and the Specific Mandate for the allotment and issue of the Warrant Shares. A circular containing, among other things, further details relating to the Warrant Placing Agreement and the transactions contemplated thereunder, and the notice of EGM will be despatched to the Shareholders as soon as practicable in accordance with the Listing Rules.

WARNING NOTICE

Completion of the Warrant Placing Agreement is subject, among other things, fulfillment of the conditions precedent in the Warrant Placing Agreement. As the Warrant Placing may or may not complete, Shareholders and potential investors are advised to exercise caution when dealing in the Shares.

DEFINITIONS

Unless the context requires otherwise, the following terms have the following meanings in this announcement:

"Board"

board of the Directors

"Business Day"

any day (excluding Saturday, Sunday or public holiday in Hong Kong) on which commercial banks generally are open for business in Hong Kong

"Company"

China Ruifeng Renewable Energy Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the issued Shares of which are listed on the Main Board of the Stock Exchange

"Completion"

"Completion Date"

completion of the Warrant Placing on the terms and subject to the conditions set out in the Warrant Placing Agreement the fourth (4th) Business Day after the day on which the Conditions have been fulfilled (or such later time or date as the Company and the Placing Agent shall agree in writing) on which the Completion shall take place pursuant to the Warrant Placing Agreement

"connected person(s)"

has the meaning ascribed to it in the Listing Rules

"Director(s)"

Director(s) of the Company

"EGM"

the extraordinary general meeting of the Company to be convened and held to approve, among others, the Warrant Placing Agreements and the transactions contemplated thereunder including the issue of the Warrants and the grant of the Specific Mandate

"Exercise Period"

the period during which the Subscription Rights attaching to the Warrants could be exercised at any time during the period of eighteen (18) months commencing from the date immediately after the date of issue of the Warrant

"Group"

the Company and its subsidiaries

"HK$"

"Hong Kong"

Hong Kong dollar(s), the lawful currency of Hong Kong the Hong Kong Special Administrative Region of the People's Republic of China

"Independent Third Party"

parties which are independent of and not connected with the Directors, chief executive, or substantial Shareholders or its subsidiaries or any of their respective associates (as defined under the Listing Rules) or parties acting in concert with any of them (as defined under the Takeovers Code) or connected persons of the Company

"Trading Day"

a day when the Stock Exchange or the case may be, an alternative stock exchange, is open for dealing business, provided that if no closing price is reported for one or more consecutive dealing days such day or days will be disregarded in any relevant calculation and shall be deemed not have existed when ascertaining any period of dealing days

"Warrant(s)"

up to 395,828,160 non-listed warrants to be issued by the Company at the Placing Price, each entitles the holder thereof initially to subscribe for Warrant Shares at the Warrant Exercise Price (subject to adjustment) at any time during the Exercise Period

"Warrant Exercise Price"

an initial exercise price of HK$0.205 per Warrant Share (subject to adjustment) at which holder of the Warrants may subscribe for the Warrant Share(s)

"Warrant Placee(s)"

any individual(s), institutional or other professional investor(s) or any of their respective subsidiaries or associates procured by the Placing Agent to subscribe for any of the Warrants pursuant to the Warrant Placing Agreement

"Warrant Placing"

the placing, on a best effort basis, of up to 395,828,160 Warrants pursuant to the terms of the Warrant Placing Agreement

"Warrant Placing Agreement"

the conditional placing agreement dated 3 March 2021 and entered into between the Company and the Placing Agent in relation to the Warrant Placing

"Warrant Placing Price"

HK$0.015 per Warrant, being the issue price for each Warrant, payable in full on application under the Warrant Placing Agreement

"Warrant Share(s)"

up to 395,828,160 new Shares to be allotted and issued upon exercise of the Subscription Rights attaching to the Warrants

"Well Foundation"

Well Foundation Company Limited, a company incorporated under the laws of Hong Kong with limited liability. Well Foundation is a wholly-owned subsidiary of China Tonghai International Financial Limited, the shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 952)

"%"

per cent.

By Order of the Board

China Ruifeng Renewable Energy Holdings Limited

Zhang Zhixiang

Executive Director and Chief Executive Officer

Hong Kong, 3 March 2021

As at the date of this announcement, the executive Directors are Mr. Zhang Zhixiang (Chief Executive Officer), Mr. Ning Zhongzhi, Mr. Li Tian Hai and Mr. Peng Ziwei; and the independent non-executive Directors are Mr. Jiang Senlin, Mr. Qu Weidong and Ms. Hu Xiaolin.

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.