Xinjiang Xinxin Mining Industry : ANNOUNCEMENT - DISCLOSEABLE TRANSACTION IN RELATION TO THE PROVISION OF GUARANTEE

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Xinjiang Xinxin Mining Industry Co., Ltd.*

อᖛอ㒥ᘤٰุ΅Ϟࠢʮ̡

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

(Stock code: 3833)

ANNOUNCEMENT

DISCLOSEABLE TRANSACTION

IN RELATION TO THE PROVISION OF GUARANTEE

PROVISION OF GUARANTEE

On 29 March 2021, the Company, as a guarantor, entered into the Guarantee Agreement in favour of the Bank, pursuant to which the Company agreed to provide guarantee, in proportion to its equity holding in Hami Hexin (a joint venture owned as to 50% equity interests by each of the Company and Qinghai Precious Metal), for the due performance of the repayment obligations of Hami Hexin to the Bank up to RMB10 million in respect of the Facility Amounts granted by the Bank. The Facility will be utilised for daily business operation and supplementing the working capital of Hami Hexin.

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Bank and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect to the provision of the Guarantee, together with the amount of guarantees provided by the Company to the Creditors of Hami Hexin within 12 months from the date of the Guarantee Agreement, are in aggregate more than 5% but less than 25% and all other applicable percentage ratios are less than 5%, it constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements but exempt from the Shareholders' approval requirement under Chapter 14 of the Listing Rules.

PROVISION OF GUARANTEE

On 29 March 2021, the Company, as a guarantor, entered into the Guarantee Agreement in favour of the Bank, pursuant to which the Company agreed to provide guarantee, in proportion to its equity holding in Hami Hexin (a joint venture owned as to 50% equity interests by each of the Company and Qinghai Precious Metal), for the due performance of the repayment obligations of Hami Hexin to the Bank up to RMB10 million in respect of the Facility Amounts granted by the Bank. The Facility will be utilised for daily business operation and supplementing the working capital of Hami Hexin.

Principal terms of the Guarantee Agreement

Date:

29 March 2021

Parties:

• (1) the Company; and

• (2) the Bank.

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Bank and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons.

Scope of Guarantee:

the Facility Amounts of RMB10 million, the interest, penalty interest, compound interest, liquidated damages, damages, and the expenses incurred by the Bank from realisation of debt (including but not limited to litigation cost, arbitration costs, legal fees, travel expenses, execution fees, preservation fees, valuation fees, auction or sale fees, transfer fees, announcement fees etc.) and other relevant expenses

Term of the Guarantee:

commencing from the effective date of the Guarantee Agreement and ending on the date of three years after the expiry of the repayment obligation of the debts under the Facility Agreement

Method of the Guarantee: joint and several liability

EFFECTIVE DATE OF THE GUARANTEE AGREEMENT

The Guarantee Agreement becomes effective when it is duly signed by both parties or the parties' company seals have been duly affixed thereon.

REASONS AND BENEFITS OF THE PROVISION OF GUARANTEE

As the Facility Amounts granted to Hami Hexin by the Bank is RMB20 million, the Guarantee provided by the Company, being RMB10 million, is in proportion to its equity interest in Hami Hexin. The other joint venture partner, Qinghai Precious Metal, has also agreed to provide guarantee for the repayment obligation of Hami Hexin to the Bank under the same terms and conditions.

The Directors consider that the provision of the Guarantee can facilitate Hami Hexin meeting its financial needs in fulfilling the working capital requirement for the mining of mineral resources in the Hami Tularergen area, Xinjiang ( อᖛ۞੗ྡזဧ࣬ ზᕃᘤ ), which is expected to provide the Company with abundant nickel and copper raw materials for its production of major products and thereby benefiting the Company in the development of its principal business, and in line with its business strategy and overall interest.

The Directors (including the independent non-executive Directors) are of the view that the terms of the Guarantee Agreement are on normal commercial terms, are fair and reasonable and in the interests of the Company and its Shareholders as a whole.

INFORMATION RELATING TO THE COMPANY, THE BANK AND HAMI HEXIN

Information relating to the Company

The Company is principally engaged in the mining, ore processing, smelting and refining of nickel, copper and other non-ferrous metals, which include cobalt and precious metals such as gold, silver, platinum and palladium.

Information relating to Hami Hexin

Hami Hexin is a company established in the PRC and is a joint venture of the Company and Qinghai Precious Metal. To the best knowledge, information and belief of the Directors having made all reasonable enquiries, as at the date of this announcement, the ultimate beneficial owner of Qinghai Precious Metal is Mr. Luo Zhehong ( Ꭳࡪ҃), and Qinghai Precious Metal and Mr. Luo Zhehong are independent third parties of the Company and not connected with the Company or its connected persons (as defined under the Listing Rules).

Each of the Company and Qinghai Precious Metal holds 50% equity interest in Hami Hexin. Hami Hexin is currently engaging in the development and production of the mineral resources in the Hami Tulaergen area, Xinjiang. Hami Hexin is not a connected person of the Company.

Information relating to the Bank

The Bank is a financial institution established in the PRC.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect to the provision of the Guarantee under the Guarantee Agreement, together with the amount of guarantees provided by the Company to the Creditors of Hami Hexin within 12 months from the date of the Guarantee Agreement, are in aggregate more than 5% but less than 25% and all other applicable percentage ratios are less than 5%, it constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements but exempt from the Shareholders' approval requirement under Chapter 14 of the Listing Rules.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following terms shall have the following meanings:

"Bank"

Urumqi Branch of China Guangfa Bank Co., Ltd* (ᄿ ೯ვБٰ΅Ϟࠢʮ̡ढኁ˝ᄁʱБ ), a financial institution established in the PRC

"Board"

the board of Directors

"Company"

Xinjiang Xinxin Mining Industry Co., Ltd.* ( อᖛอ 㒥ᘤٰุ΅Ϟࠢʮ̡ ), joint stock limited company incorporated in the PRC with limited liability, the H Shares of which are listed on the Stock Exchange

"Creditors"

the Bank, Urumqi Mingyuan Sub-branch of China Construction Bank Co., Ltd.* ( ʕ਷ܔணვБٰ΅ Ϟࠢʮ̡ढኁ˝ᄁ׼෤˕Б ), Urumqi Branch of China CITIC Bank Corporation Limited* ( ʕڦვБ ٰ΅Ϟࠢʮ̡ढኁ˝ᄁʱБ ), Xinjiang District Branch of Bank of Communications Co., Ltd.* ( ʹஷ ვБٰ΅Ϟࠢʮ̡อᖛਜʱБ ) and Hami City

Commercial Bank Co., Ltd.* ( ۞੗̹ਠุვБٰ΅

Ϟࠢʮ̡)

"Directors"

directors of the Company

"Facility"

facility up to the maximum of RMB 120 million (of which the facility up to the maximum of RMB 20 million (without collateral)) granted by the Bank to Hami Hexin under the Facility Agreement

"Facility Amounts"

the uncollateral portion of the Facility (i.e. RMB20 million) borrowed by Hami Hexin

"Facility Agreement"	the facility agreement dated 29 March 2021 entered
into between the Bank and Hami Hexin in respect of the
grant of the Facility by the Bank to Hami Hexin
"Guarantee"	guarantee provided by the Company under the
Guarantee Agreement
"Guarantee Agreement"	the guarantee agreement dated 29 March 2021 entered
into between the Company and the Bank, pursuant to
which the Company agrees to guarantee the repayment
obligations of Hami Hexin to the Bank up to RMB10
million in respect of the Facility Amounts
"Hami Hexin"	Hami Hexin Mining Company Limited* ( ۞੗ձ㒥ᘤ
ุϞࠢʮ̡ ), a limited liability company established
in the PRC on 26 October 2006, which is held as to 50%
by each of the Company and Qinghai Precious Metal
"Listing Rules"	the Rules Governing the Listing of Securities on the
Stock Exchange
"PRC"	the People's Republic of China (for the purpose of this
Announcement, excluding Hong Kong, Taiwan and the
Macau Special Administrative Region of the PRC)
"Qinghai Precious Metal"	Qinghai Western Precious Metal Company Limited*
( ڡऎГ௅೽൮ږ᙮Ϟࠢʮ̡ ), a company
incorporated in the PRC with limited liability
"Shareholders"	shareholders of the Company
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"%"	per cent

By order of the Board

Xinjiang Xinxin Mining Industry Co., Ltd.*

Li Zhenzhen, Lam Cheuk Fai

Joint Company Secretaries

Xinjiang, the PRC, 29 March 2021

As at the date of this announcement, the executive Director is Mr. Qi Xinhui; the non-executive Directors are Mr. Zhang Guohua, Mr. Zhou Chuanyou, Mr. Guo Quan and Mr. Hu Chengye; and the independent non-executive Directors are Mr. Hu Benyuan, Mr. Wang Qingming and Mr. Lee Tao Wai.

* For identification purpose only