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.

ZHEJIANG SHIBAO COMPANY LIMITED*

浙江世寶股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1057)

  1. PROPOSED WAIVER OF SHARE LOCK-UP UNDERTAKINGS OF THE ACTUAL CONTROLLERS OF THE COMPANY

AND

(B) EXTRAORDINARY GENERAL MEETING AND CLASS MEETINGS

On 20 November 2019, the sixth session of the Board of the Company resolved by way of written resolution to waive the share lock-up undertakings of the Actual Controllers of the Company subject to approval of the Shareholders. Mr. Zhang Shi Quan, Mr. Zhang Bao Yi, Mr. Tang Hao Han, Ms. Zhang Lan Jun and Mr. Zhang Shi Zhong, all of whom are connected Directors of the Company, withdrew from voting on the resolution of the Board. The proposal shall be submitted at the 2020 First EGM for consideration and approval, at which the Connected Shareholders will withdraw from voting on the proposal.

GENERAL

Reference is made to the announcement of the Company dated 1 November 2019, in relation to the proposed termination of some investment projects financed by proceeds from private placement and use of relevant proceeds from private placement to permanently replenish the working capital, and proposed amendments to the Articles of Association. The proposals shall be submitted at the general meeting of the Company for consideration and approval, in accordance with the Articles of Association. The proposal on amendments to the Articles of Association shall also be submitted at the class meeting of the Company for consideration and approval, in accordance with the Articles of Association.

The Company will convene the 2020 First EGM to, among others, seek Shareholders approval for (i) the proposal on termination of some investment projects financed by proceeds from private placement and use of relevant proceeds from private placement to permanently replenish the working capital; (ii) the proposal on amendments to the Articles of Association; and (iii) the proposal on waiver of share lock-up undertakings of the Actual Controllers of the Company.

The Company will hold the 2020 First A Shareholders' Class Meeting and the 2020 First H Shareholders' Class Meeting at the same time, to (among other things) seek approval of the class shareholders on the proposal on amendments to the Articles of Association.

A circular, containing details of the above proposals, will be despatched to the H Shareholders in accordance with the requirements of the Listing Rules.

* For identification purposes only

- 1 -

On 20 November 2019, the sixth session of the Board of the Company resolved by way of written resolution to waive the share lock-up undertakings of the Actual Controllers of the Company subject to approval of the Shareholders. Mr. Zhang Shi Quan, Mr. Zhang Bao Yi, Mr. Tang Hao Han, Ms. Zhang Lan Jun and Mr. Zhang Shi Zhong, all of whom are connected Directors of the Company, withdrew from voting on the resolution of the Board. The proposal shall be submitted at the 2020 First EGM for consideration and approval, at which the Connected Shareholders will withdraw from voting on the proposal.

WAIVER OF SHARE LOCK-UP UNDERTAKINGS OF THE ACTUAL CONTROLLERS OF THE COMPANY

Recently, the Company received the Letter in Relation to Application for a Waiver of Share Lock-up Undertakings from Mr. Zhang Shi Quan, an Actual Controller of the Company. Mr. Zhang Shi Quan applies for a waiver of certain undertakings in relation to share lock-up which were made upon A Share IPO of the Company.

  1. CONTENTS AND FULFILLMENT OF SHARE LOCK-UP UNDERTAKINGS
    In accordance with relevant representations in paragraph 1 of "Notice on Significant Matters" in the Prospectus for A Share IPO of the Company, the contents and fulfillment of undertakings made by Mr. Zhang Shi Quan are as follows:

Contents of the Undertakings

Term

Fulfillment

1. Zhang Shi Quan, Zhang Bao Yi, Tang Hao

2 November

Being fulfilled

Han, Zhang Lan Jun and Zhang Shi Zhong,

2015 and

all of whom are the actual controllers of

the period in

the issuer (the "Actual Controller(s)"), also

which they

undertake that within thirty-six months

act as Actual

following the date of listing of A Shares

Controllers,

issued by the Company, he/she will not

Directors

transfer the capital contribution held by

and senior

him/her in Shibao Holding; and that after

management

the expiry of the aforesaid term, the capital

members of

contribution to Shibao Holding which is

the Company

transferred in each year during his/her term

thereafter

of office shall not exceed 25% of capital

contributions held by him/her in Shibao

Holding; and that within half a year after

he/she resigns as a Director and senior

management member of Zhejiang Shibao,

he/she will not transfer capital contributions

held by him/her in Shibao Holding.

- 2 -

Contents of the Undertakings

Term

Fulfillment

2. Zhang Shi Quan, who is a Shareholder of

2 November

Being fulfilled

the issuer, undertakes that within thirty-six

2015 and

months following the date of listing of A

the period

Shares issued by the Company, he will not

in which he

transfer or appoint other persons to manage

acts as Actual

the Shares held by him in the Company, or

Controller,

have the Shares purchased by the Company,

Director

meanwhile, as a Director and senior

and senior

management member of the Company,

management

Zhang Shi Quan also undertakes that

member of

after the expiry of the aforesaid term, the

the Company

number of the Shares which are transferred

thereafter

in each year during his term of office will

not exceed 25% of the total number of

Shares held by him in the Company, and

that within half a year after his resignation,

he will not transfer the Shares held by him

in the Company.

  1. MATTERS IN RELATION TO SHARE LOCK-UP UNDERTAKINGS, THE WAIVER OF WHICH IS REQUESTED
    1. Contents of Share Lock-up Undertakings, the Waiver of Which is Requested
      Mr. Zhang Shi Quan applies for a waiver of "1....the capital contribution to Shibao Holding which is transferred in each year during his/her term of office shall not exceed 25% of capital contributions held by him/her in Shibao Holding..." in the aforesaid undertakings.
      The share lock-up undertakings, the waiver of which is requested by Mr. Zhang Shi Quan exclude statutory share lock-up undertakings, which are additional share lock-up undertakings voluntarily made by him in the capital market environment for the time being. The contents of the voluntary lock-up undertakings are not pre-conditions or required terms for implementation and completion of A Share IPO of a company specified by the Company Law, the Security Law and other laws and regulations.

- 3 -

  1. Reasons and Bases for Applying for a Waiver of Share Lock-up Undertakings
    As at the date of this announcement, Mr. Zhang Shi Quan holds 40% equity interest in Shibao Holding, and Shibao Holding holds 341,786,098 A Shares (accounting for 43.28% of the total share capital of the Company) in the Company. As Mr. Zhang Shi Quan is entitled to exercise one-third or more of the controlling interests in Shibao Holding, therefore, Mr. Zhang Shi Quan is deemed to be interested in all of the 341,786,098 A Shares in the Company held by Shibao Holding. As at the date of this announcement, Mr. Zhang Shi Quan directly holds 26,391,580 A Shares (accounting for 3.34% of the total share capital of the Company) in the Company. Due to his advanced years, Mr. Zhang Shi Quan intends to gradually transfer enterprise management work to, among others, young members of the family. Therefore, Mr. Zhang Shi Quan entered into the equity transfer agreements with each of his son (Mr. Zhang Bao Yi), his daughter (Ms. Zhang Lan Jun), his son-in-law (Mr. Tang Hao Han) and his brother (Mr. Zhang Shi Zhong), whereby, he intended to transfer 10%, 10%, 5% and 5% equity interest held by him in Shibao Holding to Mr. Zhang Bao Yi, Ms. Zhang Lan Jun, Mr. Tang Hao Han and Mr. Zhang Shi Zhong, respectively. The Actual Controllers of the Company remained unchanged before and after the equity transfer, namely Mr. Zhang Shi Quan, Mr. Zhang Bao Yi, Ms. Zhang Lan Jun, Mr. Tang Hao Han and Mr. Zhang Shi Zhong. In addition, as stated in the Prospectus for A Share IPO of the Company, Mr. Zhang Bao Yi, Ms. Zhang Lan Jun, Mr. Tang Hao Han and Mr. Zhang Shi Zhong have undertaken that "the capital contribution to Shibao Holding which is transferred in each year during his/her term of office shall not exceed 25% of capital contributions held by him/her in Shibao Holding", therefore, Mr. Zhang Bao Yi, Ms. Zhang Lan Jun, Mr. Tang Hao Han and Mr. Zhang Shi Zhong will takeover the share lock-up undertakings, the waiver of which is requested by Mr. Zhang Shi Quan, after the equity transfer.
    The share lock-up undertakings, the waiver of which is requested by Mr. Zhang Shi Quan, are voluntary undertakings made when the Company prepared for A Share IPO, and are not statutory undertakings made under mandatory provisions of the Company Law, the Security Law and other laws and regulations or unchangeable undertakings under existing rules, and Mr. Zhang Shi Quan did not declare that the undertakings could not be changed or waived, when making the undertakings.
    In accordance with the Rules Governing Listing of Stocks on the Shenzhen Stock Exchange, the Regulatory Guidelines for Listed Companies No.4 - Undertakings and Performance by Listed Companies and Listed Companies' De Facto Controllers, Shareholders, Related Parties and Acquirers, and relevant provisions, Mr. Zhang Shi Quan applies to the Board, the Supervisory Committee and the general meeting for a waiver of the aforesaid share lock-up undertakings.
    • 4 -

III. OPINIONS OF INDEPENDENT DIRECTORS

The application by Mr. Zhang Shi Quan for a waiver of certain undertakings in relation to share lock-up complies with relevant provisions of the Rules Governing Listing of Stocks on the Shenzhen Stock Exchange, and the Regulatory Guidelines for Listed Companies No.4 - Undertakings and Performance by Listed Companies and Listed Companies' De Facto Controllers, Shareholders, Related Parties and Acquirers, and the waiver of the share lock-up undertakings facilitates the long-term strategic development of the Company, without damage to the interests of the Company and minority Shareholders. During the course of consideration of the proposal by the Board, connected Directors withdrew from voting, and the consideration and decision-making procedures for the matter comply with the Company Law, the Rules Governing Listing of Stocks on the Shenzhen Stock Exchange and other laws and regulations, and the Articles of Association. The independent Directors agree with the proposal on the Waiver of Share Lock-up Undertakings of the Actual Controllers of the Company and submit it at the general meeting of the Company for consideration.

IV. OPINIONS OF THE SUPERVISORY COMMITTEE

The application by Mr. Zhang Shi Quan for a waiver of certain undertakings in relation to share lock-up complies with relevant provisions of the Rules Governing Listing of Stocks on the Shenzhen Stock Exchange, and the Regulatory Guidelines for Listed Companies No.4 - Undertakings and Performance by Listed Companies and Listed Companies' De Facto Controllers, Shareholders, Related Parties and Acquirers. The consideration and decision-making procedures for the waiver of the share lockup undertakings comply with the Company Law, the Rules Governing Listing of Stocks on the Shenzhen Stock Exchange and other laws and regulations, and the Articles of Association. The waiver of the share lock-up undertakings facilitates the long-term strategic development of the Company, without damage to the interests of the Company and minority Shareholders. The Supervisory Committee agrees with the proposal on the Waiver of Share Lock-up Undertakings of the Actual Controllers of the Company.

The proposal is subject to consideration and approval at the 2020 First EGM, at which the Connected Shareholders will withdraw from voting on the proposal.

GENERAL

Reference is made to the announcement of the Company dated 1 November 2019, in relation to the proposed termination of some investment projects financed by proceeds from private placement and use of relevant proceeds from private placement to permanently replenish the working capital, and proposed amendments to the Articles of Association. The proposals shall be submitted at the general meeting of the Company for consideration and approval, in accordance with the Articles of Association. The proposal on amendments to the Articles of Association shall also be submitted at the class meeting of the Company for consideration and approval, in accordance with the Articles of Association.

- 5 -

The Company will convene the 2020 First EGM to, among others, seek Shareholders approval for (i) the proposal on termination of some investment projects financed by proceeds from private placement and use of relevant proceeds from private placement to permanently replenish the working capital; (ii) the proposal on amendments to the Articles of Association; and (iii) the proposal on waiver of share lock-up undertakings of the Actual Controllers of the Company.

The Company will hold the 2020 First A Shareholders' Class Meeting and the 2020 First H Shareholders' Class Meeting at the same time, to (among other things) seek approval of the class shareholders on the proposal on amendments to the Articles of Association.

A circular containing, among others, details of (i) the proposal on termination of some investment projects financed by proceeds from private placement and use of relevant proceeds from private placement to permanently replenish the working capital; (ii) the proposal on amendments to the Articles of Association; and (iii) the proposal on waiver of share lock-up undertakings of the Actual Controllers of the Company, will be despatched to the H Shareholders in accordance with the requirements of the Listing Rules.

DEFINITIONS

In this announcement, the following expressions shall have the meanings set out below unless the context requires otherwise.

"2020 First A

the 2020 first A Shareholders' class meeting of the Company

Shareholders' Class

to be held on Monday, 13 January 2020 to consider and, if

Meeting"

thought fit, to approve, among other things, the proposal on

amendments to the Articles of Association

"2020 First EGM"

the 2020 first extraordinary general meeting of the Company

to be held by the Company on Monday, 13 January 2020

"2020 First H

the 2020 first H Shareholders' class meeting of the Company

Shareholders' Class

to be held on Monday, 13 January 2020 to consider and, if

Meeting"

thought fit, to approve, among other things, the proposal on

amendments to the Articles of Association

"A Share IPO"

the Company completed the initial public offering of 15,000,000

new A Shares on 2 November 2012, which was listed on the

SME Board of the Shenzhen Stock Exchange

"A Shareholder(s)"

holder(s) of A Shares

"A Shares"

PRC listed A Shares of the Company, with nominal value of

RMB1.00 each, which are listed and traded on the Shenzhen

Stock Exchange

- 6 -

"Articles of Association"

the articles of association of the Company, as amended from

time to time

"Board"

the board of Directors of the Company

"Company" or "Zhejiang

浙江世寶股份有限公司 (Zhejiang Shibao Company Limited*),

Shibao"

a joint stock limited company incorporated in the PRC

"Connected Shareholders"

Shibao Holding and Mr. Zhang Shi Quan

"CSRC"

China Securities Regulatory Commission

"Director(s)"

director(s) of the Company

"H Shareholder(s)"

holder(s) of H Shares

"H Shares"

overseas listed foreign shares of the Company, with nominal

value of RMB1.00 each, which are listed and traded on the

Hong Kong Stock Exchange

"Hong Kong"

the Hong Kong Special Administrative Region of the PRC

"Hong Kong Stock

The Stock Exchange of Hong Kong Limited

Exchange"

"Listing Rules"

the Rules Governing the Listing of Securities on Hong Kong

Stock Exchange

"PRC"

the People's Republic of China, but for the purposes of this

announcement, excludes Hong Kong, the Macau Special

Administrative Region and Taiwan

"RMB"

Renminbi, the lawful currency of the PRC for the time being

"Shareholder(s)"

Holder(s) of Shares

"Shibao Holding"

Zhejiang Shibao Holding Group Co., Ltd., the controlling

shareholder of the Company, and Mr. Zhang Shi Quan, Mr.

Zhang Bao Yi, Mr. Tang Hao Han, Ms. Zhang Lan Jun and

Mr. Zhang Shi Zhong holds 40%, 20%, 20%, 15% and 5%

equity interest in Shibao Holding, respectively

- 7 -

"Share(s)"

A Share(s) and/or H Share(s)

"Supervisory Committee" the supervisory committee of the Company

By order of the Board

Zhejiang Shibao Company Limited

Zhang Shi Quan

Chairman

Hangzhou, Zhejiang, the PRC

21 November 2019

As at the date of this announcement, the Board comprises Mr. Zhang Bao Yi, Mr. Tang Hao Han, Ms. Zhang Lan Jun and Ms. Liu Xiao Ping as executive Directors; Mr. Zhang Shi Quan and Mr. Zhang Shi Zhong as non-executive Directors; and Mr. Lin Yi, Mr. Guo Kong Hui and Mr. Shum Shing Kei as independent non-executive Directors.

- 8 -

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Zhejiang Shibao Company Limited published this content on 20 November 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 November 2019 12:24:09 UTC