Brainhole Technology Limited — Capital/Financing Update 2024

Jan 31, 2024

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.

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BRAINHOLE TECHNOLOGY LIMITED ��������

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2203)

(1) MAJOR TRANSACTION IN RELATION TO FURTHER ACQUISITION OF LISTED SECURITIES; AND (2) MAJOR TRANSACTION IN RELATION TO FURTHER DISPOSAL OF LISTED SECURITIES

The Board announces that the Company has entered into the following transactions involving acquisition and disposal of listed securities.

Further Acquisition of Super Micro Shares

On 30 January 2024 (after trading hours of the Stock Exchange), further to the Previous Acquisitions of Super Micro Shares and the Previous Disposals of Super Micro Shares as disclosed in the relevant Previous Announcements, the Company has further acquired an aggregate of 1,960 Super Micro Shares through the open market at an aggregate consideration of approximately US$1.0 million (equivalent to approximately HK$8.0 million) (excluding transaction costs).

Further Disposal of NVIDIA Shares

On 30 January 2024 (after trading hours of the Stock Exchange), further to the Previous Acquisitions of NVIDIA Shares and the Previous Disposals of NVIDIA Shares as disclosed in the relevant Previous Announcements, the Company has further disposed of an aggregate of 1,430 NVIDIA Shares through the open market at an aggregate consideration of approximately US$0.9 million (equivalent to approximately HK$7.0 million) (excluding transaction costs).

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LISTING RULES IMPLICATION

Further Acquisition of Super Micro Shares

Pursuant to Rule 14.22 and Rule 14.23 of the Listing Rules for the purpose of classification of the transactions, as the Previous Acquisitions of Super Micro Shares, the Previous Disposals of Super Micro Shares and the Further Acquisition of Super Micro Shares involve the acquisitions and disposals of Super Micro Shares within a 12-month period, all transactions respectively contemplated thereunder are considered and are aggregated as one transaction at a total consideration of approximately US$2.5 million (equivalent to approximately HK$19.8 million).

The Further Acquisition of Super Micro Shares, on a standalone basis, constitutes a discloseable transaction since one or more of the applicable percentage ratios (as defined under the Listing Rules) are more than 5% but all of such ratios are less than 25%.

As the highest applicable percentage ratio under Rule 14.07 of the Listing Rules in respect of the Further Acquisition of Super Micro Shares, when aggregated with the Previous Acquisitions of Super Micro Shares and the Previous Disposals of Super Micro Shares by the Company in the preceding 12-month period, exceeds 25% but is less than 100%, the Further Acquisition of Super Micro Shares constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and will be subject to reporting, announcement, circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

Further Disposal of NVIDIA Shares

Pursuant to Rule 14.22 and Rule 14.23 of the Listing Rules for the purpose of classification of the transactions, as the Previous Acquisitions of NVIDIA Shares, the Previous Disposals of NVIDIA Shares and the Further Disposal of NVIDIA Shares involve the acquisitions and disposals of NVIDIA Shares within a 12-month period, all transactions respectively contemplated thereunder are considered and are aggregated as one transaction at a total consideration of approximately US$2.3 million (equivalent to approximately HK$17.7 million).

The Further Disposal of NVIDIA Shares, on a standalone basis, constitutes a discloseable transaction since one or more of the applicable percentage ratios (as defined under the Listing Rules) are more than 5% but all of such ratios are less than 25%.

As the highest applicable percentage ratio under Rule 14.07 of the Listing Rules in respect of the Further Disposal of NVIDIA Shares, when aggregated with the Previous Acquisitions of NVIDIA Shares and the Previous Disposals of NVIDIA Shares by the Company in the preceding 12-month period, exceeds 25% but is less than 75%, the Further Disposal of NVIDIA Shares constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and will be subject to reporting, announcement, circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

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WRITTEN SHAREHOLDER’S APPROVAL

Pursuant to Rule 14.44 of the Listing Rules, shareholders’ approval may be obtained by written shareholders’ approval in lieu of convening a general meeting if (a) no shareholder is required to abstain from voting if the Company were to convene a general meeting for the approval of each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares; and (b) written approval has been obtained from a shareholder or a closely allied group of shareholders who together hold more than 50% of the issued share capital of the Company giving the right to attend and vote at general meetings to approve each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder has any material interest in each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares. Thus, if the Company were to convene a general meeting to approve each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares, no Shareholder is required to abstain from voting on the resolutions in relation to the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares. As such, each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares may be approved by written Shareholders’ approval in accordance with Rule 14.44 of the Listing Rules.

The Board is pleased to announce that, in relation to written approval in lieu of holding a general meeting in respect of each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares, it obtained the Shareholder’s approval from Yoho Bravo Limited which holds 599,658,000 shares (representing approximately 74.96% of the total issued share capital of the Company as at the date of this announcement) pursuant to Rule 14.44 of the Listing Rules. As a result, no extraordinary general meeting will be convened to consider each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares.

A circular in relation to each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares and other information required to be disclosed under the Listing Rules will be dispatched to the Shareholders, for information purposes only within 15 business days after the publication of this announcement, i.e., on or before 23 February 2024.

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The Board announces that the Company has entered into the following transactions involving acquisition and disposal of listed securities.

Further Acquisition of Super Micro Shares

On 30 January 2024 (after trading hours of the Stock Exchange), further to the Previous Acquisitions of Super Micro Shares and the Previous Disposals of Super Micro Shares as disclosed in the relevant Previous Announcements, the Company has further acquired an aggregate of 1,960 Super Micro Shares through the open market at an aggregate consideration of approximately US$1.0 million (equivalent to approximately HK$8.0 million) (excluding transaction costs). The average price (excluding transaction costs) for the further acquisition of each Super Micro Share was approximately US$523.00 (equivalent to approximately HK$4,068.94). The aggregate consideration of approximately US$1.0 million (equivalent to approximately HK$8.0 million) (excluding transaction costs) was financed by the Group’s existing internal financial resources.

As the Further Acquisition of Super Micro Shares was conducted in the open market, the identities of the counterparties of the acquired Super Micro Shares cannot be ascertained. To the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the counterparties and the ultimate beneficial owner(s) of the counterparties of the acquired Super Micro Shares are Independent Third Parties.

Further Disposal of NVIDIA Shares

On 30 January 2024 (after trading hours of the Stock Exchange), further to the Previous Acquisitions of NVIDIA Shares and the Previous Disposals of NVIDIA Shares as disclosed in the relevant Previous Announcements, the Company has further disposed of an aggregate of 1,430 NVIDIA Shares through the open market at an aggregate consideration of approximately US$0.9 million (equivalent to approximately HK$7.0 million) (excluding transaction costs), which are receivable in cash on settlement. The average price (excluding transaction costs) for the disposal of each NVIDIA Share was approximately US$628.34 (equivalent to approximately HK$4,888.52).

As the Further Disposal of NVIDIA Shares was conducted in the open market, the identities of the counterparties of the disposed NVIDIA Shares cannot be ascertained. To the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the counterparties and the ultimate beneficial owner(s) of the counterparties of the disposed NVIDIA Shares are Independent Third Parties.

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INFORMATION ON SUPER MICRO AND NVIDIA

Super Micro

Super Micro is a Delaware corporation and a Silicon Valley-based provider of accelerated compute platforms that are application-optimized high-performance and high-efficiency server and storage systems for various markets, including enterprise data centers, cloud computing, artificial intelligence, 5G and edge computing. Super Micro’s solutions include complete servers, storage systems, modular blade servers, blades, workstations, complete rack scale plug and play solutions delivering pre-defined and pre-tested full rack scale solutions, networking devices, server sub-systems, system management and security software.

The following financial information is extracted from the published documents of the Super Micro Group:

	For the year ended	For the year ended
	30 June 2022	30 June 2023
	(audited)	(audited)
	US$’000 HK$’000	US$’000 HK$’000
Net sales	5,196,099 40,425,650	7,123,482 55,420,690
Income before income tax
provision	336,833 2,620,561	754,297 5,868,431
Net income	285,163 2,218,568	639,998 4,979,184

Based on Super Micro’s published documents, the Super Micro Group has an audited consolidated net assets value of approximately and US$1,426 million (equivalent to approximately HK$11,094 million) as at 30 June 2022 and US$1,972 million (equivalent to approximately HK$15,342 million) as at 30 June 2023.

Based on Super Micro’s published documents, the Super Micro Group has an unaudited consolidated net asset value of approximately US$2,166 million (equivalent to approximately HK$16,851 million) as at 30 September 2023.

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NVIDIA

NVIDIA is a Delaware corporation and a software and fabless company which designs graphics processing units (GPUs), application programming interface (APIs) for data science and high-performance computing as well as system on a chip units (SoCs) for the mobile computing and automotive market. NVIDIA is a dominant supplier of artificial intelligence hardware and software. Its professional line of GPUs are used in workstations for applications in such fields as architecture, engineering and construction, media and entertainment, automotive, scientific research, and manufacturing design. In addition to GPU manufacturing, NVIDIA provides an API called CUDA that allows the creation of massively parallel programs which utilize GPUs.

	For the year ended	For the year ended	For the year ended	For the year ended
	30 January 2022		29 January 2023
	(audited)		(audited)
	US$’000	HK$’000	US$’000	HK$’000
Revenue	26,914	209,391	26,974	209,858
Net income	9,752	75,871	4,368	33,398

Based on NVIDIA’s published documents, the NVIDIA Group has an audited consolidated net assets value of approximately US$26,612 million (equivalent to approximately HK$207,041 million) as at 30 January 2022 and US$22,101 million (equivalent to approximately HK$171,946 million) as at 29 January 2023.

Based on NVIDIA’s published documents, the NVIDIA Group has an unaudited consolidated net asset value of approximately US$33,265 million (equivalent to approximately HK$258,802 million) as at 29 October 2023.

REASONS FOR AND BENEFITS OF THE FURTHER ACQUISITION OF SUPER MICRO SHARES

The Group is principally engaged in the manufacturing and trading of semiconductors, broadband infrastructure construction and the provision of integrated solution for smart domain application (including smart home, smart campus and smart communities).

The Group believes that technological innovation is an important engine for future economic development, and it can also drive the emerging applications in the smart living sector. The Group always hopes to leverage our own advantages in the field of smart technology to actively diversify the investments in the field of innovative technologies, in order to facilitate the technological development and create greater value for the Shareholders.

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Super Micro is an information technology company in United States. The Board holds positive views towards the financial performance and future prospect of Super Micro. The Group considers that the Further Acquisition of Super Micro Shares represents a good opportunity to acquire attractive investment and to expand its investment portfolio with quality assets, which will enhance investment return for the Group.

As the Further Acquisition of Super Micro Shares was made in the open market at prevailing market prices, the Directors are of the view that the terms of the Further Acquisition of Super Micro Shares are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

REASONS FOR AND BENEFITS OF THE FURTHER DISPOSAL OF NVIDIA SHARES

As a result of the Further Disposal of NVIDIA Shares, the Group is expected to recognise a gain of approximately US$0.2 million (equivalent to approximately HK$1.4 million) being the difference between the consideration received from the Further Disposal of NVIDIA Shares and the acquisition cost of disposed NVIDIA Shares. The Group considers that the Further Disposal of NVIDIA Shares represents an opportunity to allow the Group to reallocate the resources and investment portfolio. The Group has applied all the proceeds from the Further Disposal of NVIDIA Shares of approximately US$0.9 million (equivalent to approximately HK$7.0 million) for the consideration for the Further Acquisition of Super Micro Shares.

As the Further Disposal of NVIDIA Shares was made in the open market at prevailing market price, the Directors are of the view that the terms of the Further Disposal of NVIDIA Shares are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

IMPLICATIONS UNDER THE LISTING RULES

Further Acquisition of Super Micro Shares

Pursuant to Rule 14.22 and Rule 14.23 of the Listing Rules for the purpose of classification of the transactions, as the Previous Acquisitions of Super Micro Shares, the Previous Disposals of Super Micro Shares and the Further Acquisition of Super Micro Shares involve the acquisitions and disposals of Super Micro Shares within a 12-month period, all transactions respectively contemplated thereunder are considered and are aggregated as one transaction at a total consideration of approximately US$2.5 million (equivalent to approximately HK$19.8 million).

The Further Acquisition of Super Micro Shares, on a standalone basis, constitutes a discloseable transaction since one or more of the applicable percentage ratios (as defined under the Listing Rules) are more than 5% but all of such ratios are less than 25%.

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As the highest applicable percentage ratio under Rule 14.07 of the Listing Rules in respect of the Further Acquisition of Super Micro Shares, when aggregated with the Previous Acquisitions of Super Micro Shares and the Previous Disposals of Super Micro Shares by the Company in the preceding 12-month period, exceeds 25% but is less than 100%, the Further Acquisition of Super Micro Shares constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and will be subject to reporting, announcement, circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

Further Disposal of NVIDIA Shares

Pursuant to Rule 14.22 and Rule 14.23 of the Listing Rules for the purpose of classification of the transactions, as the Previous Acquisitions of NVIDIA Shares, the Previous Disposals of NVIDIA Shares and the Further Disposal of NVIDIA Shares involve the acquisitions and disposals of NVIDIA Shares within a 12-month period, all transactions respectively contemplated thereunder are considered and are aggregated as one transaction at a total consideration of approximately US$2.3 million (equivalent to approximately HK$17.7 million).

The Further Disposal of NVIDIA Shares, on a standalone basis, constitutes a discloseable transaction since one or more of the applicable percentage ratios (as defined under the Listing Rules) are more than 5% but all of such ratios are less than 25%.

As the highest applicable percentage ratio under Rule 14.07 of the Listing Rules in respect of the Further Disposal of NVIDIA Shares, when aggregated with the Previous Acquisitions of NVIDIA Shares and the Previous Disposals of NVIDIA Shares by the Company in the preceding 12-month period, exceeds 25% but is less than 75%, the Further Disposal of NVIDIA Shares constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and will be subject to reporting, announcement, circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

WRITTEN SHAREHOLDER’S APPROVAL

Pursuant to Rule 14.44 of the Listing Rules, shareholders’ approval may be obtained by written shareholders’ approval in lieu of convening a general meeting if (a) no shareholder is required to abstain from voting if the Company were to convene a general meeting for the approval of each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares; and (b) written approval has been obtained from a shareholder or a closely allied group of shareholders who together hold more than 50% of the issued share capital of the Company giving the right to attend and vote at general meetings to approve each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares.

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To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder has any material interest in each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares. Thus, if the Company were to convene a general meeting to approve each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares, no Shareholder is required to abstain from voting on the resolutions in relation to the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares. As such, each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares may be approved by written Shareholders’ approval in accordance with Rule 14.44 of the Listing Rules.

The Board is pleased to announce that, in relation to written approval in lieu of holding a general meeting in respect of each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares, it obtained the Shareholder’s approval from Yoho Bravo Limited which holds 599,658,000 shares (representing approximately 74.96% of the total issued share capital of the Company as at the date of this announcement) pursuant to Rule 14.44 of the Listing Rules. As a result, no extraordinary general meeting will be convened to consider each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares.

A circular in relation to each of the Further Acquisition of Super Micro Shares and the Further Disposal of NVIDIA Shares and other information required to be disclosed under the Listing Rules will be dispatched to the Shareholders, for information purposes only within 15 business days after the publication of this announcement, i.e., on or before 23 February 2024.

DEFINITIONS

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

“Board”	the board of Directors of the Company
“Company”	Brainhole Technology 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 (stock
	code: 2203)
“connected person(s)”	has the meaning ascribed to it under the Listing Rules
“Director(s)”	the director(s) of the Company
“Further Acquisition of	further acquisition of 1,960 Super Micro Shares by the
Super Micro Shares”	Company as disclosed in this announcement
“Further Disposal of	further disposal of 1,430 NVIDIA Shares by the Company as
NVIDIA Shares”	disclosed in this announcement

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• “Group” the Company and its subsidiaries “HK$” Hong Kong dollars, the lawful currency of Hong Kong “Hong Kong” means the Hong Kong Special Administrative Region of the PRC

• “Independent Third third party(ies) independent of and not connected with the Party(ies)” Company and its connected persons and is not acting in concert (as defined in the Codes on Takeovers and Mergers and Share Buy-backs) with any of the connected persons of the Company or any of their respective associates (as defined under the Listing Rules)

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

• “Nasdaq” National Association of Securities Dealers Automated Quotations Stock Market

• “NVIDIA” NVIDIA Corporation, a Delaware corporation whose common stocks are listed on Nasdaq (trading symbol: NVDA)

• “NVIDIA Group” NVIDIA and its subsidiaries “NVIDIA Share(s)” Common stock(s) of NVIDIA

• “Previous Acquisitions of the series of acquisitions of an aggregate of 9,470 NVIDIA NVIDIA Shares” Shares by the Company during the period from 4 August 2023 (after trading hours the Stock Exchange) and 24 January 2024 (after trading hours the Stock Exchange), as set out in the relevant Previous Announcements

• “Previous Acquisitions of the series of acquisitions of an aggregate of 10,530 Super Micro Super Micro Shares” Shares by the Company during the period from 15 August 2023 (after trading hours the Stock Exchange) and up to (and inclusive of) 24 January 2024 (after trading hours the Stock Exchange) as set out in the relevant Previous Announcements

• “Previous Announcements” the announcements of the Company dated 16 August 2023, 25 August 2023, 19 September 2023, 15 December 2023, 20 December 2023, 28 December 2023, 24 January 2024 and 25 January 2024 in relation to, inter alia , the Previous Acquisitions of Super Micro Shares, the Previous Acquisitions of NVIDIA Shares, the Previous Disposals of NVIDIA Shares and the Previous Disposals of Super Micro Shares

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“Previous Disposals of	the series of disposals of an aggregate of 3,530 NVIDIA Shares
NVIDIA Shares”	by the Company during the period from 4 December 2023 (after
	trading hours the Stock Exchange) and 19 December 2023 (after
	trading hours the Stock Exchange) respectively, as set out in the
	relevant Previous Announcements
“Previous Disposals of	the series of disposals of an aggregate of 6,620 Super Micro
Super Micro Shares”	Shares by the Company during the period from 18 September
	2023 (after trading hours the Stock Exchange) and up to (and
	inclusive of) 27 December 2023 (after trading hours the Stock
	Exchange) as set out in the relevant Previous Announcements
“PRC”	the People’s Republic of China
“Shareholders”	holder(s) of the Share(s)
“Share(s)”	ordinary share(s) in the issued share capital of the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Super Micro”	Super Micro Computer, Inc., a Delaware corporation whose
	common stocks are listed on Nasdaq (trading symbol: SMCI)
“Super Micro Group”	Super Micro and its subsidiaries
“Super Micro Share(s)”	Common stock(s) of Super Micro
“United States”	the United States of America
“US$”	United States dollars, the lawful currency of the United States
“%”	per cent.
	By order of the Board
	Brainhole Technology Limited
	Zhang Liang Johnson
	Chairman and Executive Director

Hong Kong, 31 January 2024

For the purpose of this announcement, all amounts denominated in US$ have been translated (for information only) into HK$ using the exchange rate of US$1.00:HK$7.78. Such translations shall not be construed as a representation that amounts of US$ were or may have been converted.

As at the date of this announcement, the Board comprises Mr. Zhang Liang Johnson and Ms. Wan Duo as executive Directors and Mr. Xu Liang, Mr. Chen Johnson Xi and Ms. Zhang Yibo as independent non-executive Directors.

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