KINGWELL GROUP LIMITED IMPORTANT
If you are in any doubt as to any aspect about this circular or as to the action to be taken, you should consult your licensed securities dealer, registered institution in securities, bank manager, solicitor, professional accountant or other professional adviser.
If you have sold or transferred all your shares in Kingwell Group Limited, you should at once hand this circular and the accompanying proxy form to the purchaser or the transferee or to the bank, licensed securities dealer, registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular and the accompanying proxy form, make no representation as to their 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 circular and the accompanying proxy form.
KINGWELL GROUP LIMITED
京 維 集 團 有 限 公 司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1195)
GENERAL MANDATE TO ISSUE SHARES,
RE-ELECTION OF RETIRING DIRECTORS,
PROPOSED ADOPTION OF NEW SHARE OPTION SCHEME AND
TERMINATION OF EXISTING SHARE OPTION SCHEME
AND
NOTICE OF ANNUAL GENERAL MEETING
Resolutions will be proposed at the annual general meeting (the "AGM") of the Company to be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 12 December 2019 at 11:00 a.m. to approve the matters referred to in this circular. If you are unable to attend the AGM in person, you are requested to complete and return the form of proxy enclosed with this circular in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting at the meeting or any adjournment thereof should you so wish.
31 October 2019
CONTENTS
Page | ||
Definitions . | . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 1 |
Letter from the Board | ||
1. | Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 4 |
2. | General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 5 |
3. | Re-election of Retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 5 |
4. Proposed Adoption of New Share Option Scheme and
Termination of Existing Share Option Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 8 | |
5. | Annual General Meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 11 |
6. | Voting by way of Poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 12 |
7. | Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 12 |
8 | Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 12 |
Appendix I | - Principal Terms of the New Share Option Scheme . . . . . . . . . . . . . . . . . . . . . . . | 13 |
Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 29 |
- i -
DEFINITIONS
In this circular, unless the context otherwise requires, the following expressions have the following meaning:
"2019 Annual Report"the audited consolidated financial statements and the reports of the Directors and auditor of the Company for the year ended 30 June 2019;
"Adoption Date"
"AGM"
the date on which the New Share Option Scheme is adopted by resolution of the Shareholders in AGM;
the annual general meeting of the Company to be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 12 December 2019 at 11:00 a.m. at which the 2019 Annual Report will be adopted;
"Articles of Association"
"Board"
"Company"
"Director(s)"
"Eligible Employee(s)"
"Eligible Participant(s)"
"Existing Share Option Scheme"
"Grantee"
"Group"
the articles of association of the Company;
the board of Directors;
Kingwell Group Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Stock Exchange;
director(s) of the Company;
any full-time employee, director (including any executive director but excluding any non-executive director) and part-time employee with weekly working hours of 15 hours or above of the Group;
the persons to whom the Directors may extend an Offer to take up Options as referred to Principal Terms of the New Share Option Scheme paragraph 4.1;
the share option scheme of the Company adopted on 11 February 2010;
any Eligible Participant who accepts the Offer in accordance with the terms of the New Share Option Scheme or (where the context so permits) a person entitled to any such Option in consequence of the death of the original Grantee;
the Company and its subsidiaries from time to time;
- 1 -
DEFINITIONS
"Hong Kong"
"HK$"
"Issue Mandate"
"Latest Practicable Date"
"Listing Rules"
"New Share Option Scheme" or the "Scheme"
"Offer"
"Offer Date"
"Option"
"Option Period"
"PRC" "SFO"
"Share(s)"
"Shareholder(s)" "Stock Exchange"
the Hong Kong Special Administrative Region of the PRC;
Hong Kong dollars, the lawful currency of Hong Kong;
the general mandate to allot, issue and deal with Shares not exceeding 20% of the issued shares of the Company as at the date of passing of the relevant ordinary resolution;
25 October 2019, being the latest practicable date prior to the printing of this circular;
the Rules Governing the Listing of Securities on the Stock Exchange;
the new share option scheme proposed to be adopted by the Company at the AGM;
an offer for the grant of an Option made in accordance with Principal Terms of the New Share Option Scheme paragraph 4.6;
the date, which must be a business day, on which the Board passes a resolution approving the making of an offer of grant of an Option to an Eligible Participant;
an option to subscribe for the Shares granted pursuant to the New Share Option Scheme;
in respect of any particular Option, a period (which may not expire later than 10 years from the Offer Date of that Option) to be determined and notified by the Directors to the Grantee thereof and, in the absence of such determination, from the Offer Date to the earlier of (i) the date on which such Option lapses under the provisions of the New Share Option Scheme paragraph 7; and (ii) 10 years from the Offer Date of that Option;
The People's Republic of China;
the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong);
ordinary shares of HK$0.10 each in the share capital of the Company;
holder(s) of Share(s);
The Stock Exchange of Hong Kong Limited;
- 2 -
DEFINITIONS
"Subscription Price"
"Subsidiary"
"Termination Date"
"%"
the price per Share at which a Grantee may subscribe for the Shares on the exercise of an Option pursuant to the New Share Option Scheme;
a company which is for the time being and from time to time a subsidiary or a subsidiary undertaking (within the meaning of the Companies Ordinance (Cap. 622 of the Laws of Hong Kong)) of the Company, whether incorporated in Hong Kong, Bermuda, the British Virgin Islands, the People's Republic of China or elsewhere or any entity which is accounted for or consolidated in the audited accounts of the Company pursuant to the applicable Hong Kong Financial Reporting Standards or International Financial Reporting Standards;
close of business of the Company on the date which falls ten (10) years after the Adoption Date; and
per cent.
- 3 -
LETTER FROM THE BOARD
KINGWELL GROUP LIMITED
京 維 集 團 有 限 公 司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1195)
Executive Directors: | Registered Office: |
Mr. Mu Dongsheng (Chairman and Chief Executive Officer) | Cricket Square |
Mr. Sze Ming Yee | Hutchins Drive |
P.O. Box 2681 | |
Independent Non-executive Directors: | Grand Cayman |
Mr. Cheung Chuen | KY1-1111 |
Mr. Ling Aiwen | Cayman Islands |
Mr. Lu Lin | |
Principal Office in Hong Kong: | |
Units 314-315 | |
Wing On Plaza | |
62 Mody Road | |
Tsimshatsui East | |
Kowloon | |
31 October 2019 | |
To the Shareholders | |
Dear Sirs or Madams, |
GENERAL MANDATE TO ISSUE SHARES,
RE-ELECTION OF RETIRING DIRECTORS,
PROPOSED ADOPTION OF NEW SHARE OPTION SCHEME AND
TERMINATION OF EXISTING SHARE OPTION SCHEME
AND
NOTICE OF ANNUAL GENERAL MEETING
1. INTRODUCTION
At the AGM, ordinary resolutions will be proposed to approve (i) the granting of the Issue Mandate;
- the re-election of the retiring Directors; and (iii) proposed adoption of New Share Option Scheme and termination of Existing Share Option Scheme.
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LETTER FROM THE BOARD
This circular contains all the information reasonably necessary to enable the Shareholders to make informed decisions on whether to vote for or against the resolutions approving the Company to issue Shares, to re-elect the retiring Directors and to adopt New Share Option Scheme and terminate Existing Share Option Scheme.
2. GENERAL MANDATE TO ISSUE SHARES
At the annual general meeting of the Company held on 12 December 2018, an ordinary resolution was passed by the Shareholders on granting the existing Issue Mandate to the Directors.
An ordinary resolution will be proposed at the AGM to revoke the existing Issue Mandate and to grant to the Directors a fresh Issue Mandate, i.e. a general and unconditional mandate to allot, issue and deal with, otherwise by way of rights issue or any option scheme or similar arrangements for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of shares or rights to acquire shares in the Company or any shares of the Company issued as scrip dividends pursuant to the memorandum and articles of association of the Company, additional Shares with an aggregate value not exceeding 20% of the total number of issued shares of the Company in issue at the date of the passing of such resolution. Based on 2,884,091,737 Shares in issue as at the Latest Practicable Date and assuming no further Shares are issued and no Shares are repurchased after the Latest Practicable Date and up to the date of the AGM, the Directors will be able to allot, issue and deal with 576,818,347 Shares if the fresh Issue Mandate is granted at the AGM, which will remain in effect until the earliest of (i) the conclusion of the next annual general meeting of the Company; (ii) the expiration of the period within which the next annual general meeting of the Company is required to be held by the Articles of Association or any applicable laws of the Cayman Islands; and (iii) the date upon which such authority is revoked or varied by an ordinary resolution of the Shareholders in a general meeting of the Company.
3. RE-ELECTION OF RETIRING DIRECTORS
In relation to ordinary resolution number 2 set out in the notice of the AGM regarding the reelection of retiring Directors, Mr. Mu Dongsheng and Mr. Cheung Chuen shall retire as Directors by rotation at the AGM pursuant to article 87(1) of the Articles of Association, and, being eligible, will offer themselves for re-election.
Mr. Mu Dongsheng（穆東升）, aged 49, is an executive Director, chairman, authorised representative and chief executive officer of the Company. Mr. Mu has 22 years of working experience in management in both government and private sector in the PRC and abroad. Mr. Mu holds a Master's Degree in Laws from the Beijing Foreign Affairs College. Mr. Mu was appointed as an executive Director on 15 January 2016 and was a consultant of the Company prior to joining the Company. Mr. Mu is also a member of the remuneration committee of the Company and the chairman of the nomination committee of the Company. He is also a director of various subsidiaries of the Company.
Mr. Mu has 277,777,777 ordinary shares of 10.08% of the issued Shares within the meaning of Part XV of the SFO.
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LETTER FROM THE BOARD
Mr. Mu has entered into a service agreement with the Company for a term of one year commencing from 15 January 2016, and his appointment will continue thereafter until terminated by six months' notice in writing served by either party on the other. Mr. Mu is subject to retirement by rotation and re-election pursuant to the memorandum and Articles of Association. Mr. Mu does not receive director remuneration as an executive Director of the Company.
As at the Latest Practicable Date, save as disclosed above, Mr. Mu (i) did not hold other directorships in the last three years in public companies the securities of which are listed on any securities market in Hong Kong or overseas; (ii) does not have any other interests in the Shares, underlying shares and debentures of the Company within the meaning of Part XV of the SFO; and (iii) does not have any relationship with any directors, senior management or substantial or controlling shareholders of the Company.
Mr. Cheung Chuen（張全）, aged 45, is an independent non-executive Director of the Company. He is a certified public accountant practicing in the United States of America and Hong Kong. Mr. Cheung graduated from Hong Kong Shue Yan University in 1999 with majoring in accounting and obtained a master degree in professional accounting from the Hong Kong Polytechnic University in 2004. He is a member of the American Institute of Certified Public Accountants and an associate member of the Hong Kong Institute of Certified Public Accountants. Mr. Cheung has over the years gained extensive experience in accounting and auditing. He has been appointed as an independent non-executive Director of the Company since 30 September 2004. Mr. Cheung currently is an executive director of China High Precision Automation Group Limited (Stock Code: 591), a listed company in Hong Kong. Mr. Cheung is also a member of the audit committee, remuneration committee and corporate governance of the Company.
Mr. Cheung has entered into an appointment letter with the Company for a term of one year commencing from 1 January 2019 and is subject to retirement by rotation and offers himself for reelection in accordance with the Articles of Association. Mr. Cheung is entitled to a director's remuneration of HK$144,000 per annum, which is determined based on the prevailing market rate, without any bonus payment.
As at the Latest Practicable Date, save as disclosed above, Mr. Cheung (i) did not hold other directorships in the last three years in public companies the securities of which are listed on any securities market in Hong Kong or overseas and has not held other major or professional appointments or any other positions in the Company or its subsidiaries; (ii) does not have any other interests in the Shares, underlying shares and debentures of the Company within the meaning of Part XV of the SFO; and (iii) does not have any relationship with any directors, senior management or substantial or controlling shareholders of the Company.
- 6 -
LETTER FROM THE BOARD
Mr. Cheung Chuen, being independent non-executive Director of the Company eligible for reelection at the AGM, has made a confirmation of independence pursuant to the independence guidelines set out in Rule 3.13 of the Listing Rules. Pursuant to Rule 3.13 of the Listing Rules, Mr. Cheung (i) did not hold any issued shares of the Company; (ii) had not received an interest in any securities of the Company as a gift, or by means of other financial assistance, from a core connected person or the Company; (iii) did not hold any directorships of the Company's subsidiaries or core connected persons or controlling shareholders; (iv) did not have a material interest in any principal business activity of or is or was involved in any material business dealings with the Company, its holding company or their respective subsidiaries or with any core connected persons of the Company; (v) is not on the Board specifically to protect the interests of an entity whose interests are not the same as those of the shareholders as a whole;
- is not or was not connected with a director, the chief executive or a substantial shareholder of the Company within two years immediately prior to the date of his proposed appointment; (vii) is not, or has not at any time during the two years immediately prior to the date of his proposed appointment been, an executive or director (other than an independent non-executive director) of the Company, of its holding company or of any of their respective subsidiaries or of any core connected persons of the Company; and (viii) is not financially dependent on the Company, its holding company or any of their respective subsidiaries or core connected persons of the Company.
Mr. Cheung Chuen has served the Company for more than nine years. During his years of appointment, Mr. Cheung showed his independence that he proposed valuable suggestion or reverse advice base on his knowledges and experiences to the Board. Mr. Cheung has demonstrated his ability to provide an independent view to the Company's matters. The nomination committee of the Company (the "Nomination Committee") considered that his long service would not affect his exercise of independent judgment and was satisfied that Mr. Cheung Chuen has the required integrity and experience to continue fulfilling the role of independent non-executive Director.
Taking into consideration of the above, the Board is of the view that Mr. Cheung Chuen remains independent notwithstanding the length of his service and should be re-elected at the AGM. Furthermore, the Company is of the view that Mr. Cheung is independent in accordance with the independence guidelines and considers that he should be re-elected at the AGM. In accordance with the corporate governance code as set out in the Listing Rules, the re-election of Mr. Cheung Chuen will be subject to a separate resolution to be approved at the AGM.
Save as disclosed above, there are no other matters in relation to the re-election of Mr. Mu Dongsheng and Mr. Cheung Chuen that need to be brought to the attention of the Stock Exchange or the Shareholders. There is no information relating to all the retiring Directors that is required to be disclosed pursuant to Rule 13.51(2)(h)-(v) of the Listing Rules.
- 7 -
LETTER FROM THE BOARD
In accordance with the nomination policy of the Company and the objective criteria (including without limitation, gender, age, ethnicity, cultural and educational background, professional experiences and knowledge) with due regard for the benefits of diversity, as set out under the board diversity policy of the Company, the Nomination Committee has reviewed the re-election of the Directors through:
- evaluating the performance and contribution of the retiring Directors during the last financial year of the Company and the period thereafter up to the date of evaluation; and
- assessing the independence of the independent non-executive Directors, being Mr. Cheung Chuen, Mr. Ling Aiwen and Mr. Lu Lin, and considered whether they remained independent and suitable to continue to act in such roles.
After due evaluation and assessment, the Nomination Committee is of the opinion that:
- the performance of the retiring Directors was satisfactory and contributed effectively to the operation of the Board; and
- based on the information available to the Nomination Committee and the annual written independence confirmation received from the independent non-executive Directors, the Nomination Committee was satisfied that Mr. Cheung Chuen, Mr. Ling Aiwen and Mr. Lu Lin
- fulfill the requirements of an independent non-executive Director as stipulated under Rule 3.13 of the Listing Rules; and
- are the persons of integrity and independent in character and judgement.
Accordingly, the Nomination Committee recommended to the Board, and the Board has considered the re-election of Mr. Mu Dongsheng as the executive Director and Mr. Cheung Chuen and Mr. Lu Lin as the independent non-executive Director, is in the best interests of the Company and the Shareholders as a whole and has resolved to propose to re-elect each of the retiring Directors at the AGM.
4. PROPOSED ADOPTION OF NEW SHARE OPTION SCHEME AND TERMINATION OF EXISTING SHARE OPTION SCHEME
The Existing Share Option Scheme
The Existing Share Option Scheme was adopted on 11 February 2010 and will expire on 10 February 2020. In view of the expiration of the Existing Share Option Scheme and no further options can be granted pursuant to the Existing Share Option Scheme after its expiration even if the scheme mandate limit under the Existing Share Option Scheme is refreshed, the Directors propose to recommend to the Shareholders at the AGM to approve the termination of the operation of the Existing Share Option Scheme and the adoption of the New Share Option Scheme. The provisions of the Existing Share Option Scheme shall remain in full force and effect to the extent necessary to give effect to the exercise of options granted prior to its expiration or otherwise as may be required in accordance with the provisions of the Existing Share Option Scheme. Options granted prior to such expiration shall continue to be valid and exercisable in accordance with the provisions of the Existing Share Option Scheme. As at the Latest Practicable Date, there were 96,304,000 options granted but remained outstanding under the Existing Share Option Scheme.
- 8 -
LETTER FROM THE BOARD
The following table discloses movements in the Company's share options of the Existing Share Option Scheme from 1 July 2018 to 30 June 2019:
Cancelled/ | Outstanding | Market value | |||||||||||||||||
Outstanding | Granted | Exercised | Lapsed | as at | per share at | ||||||||||||||
Name or category | as at | during the | during the | during the | 30 June | Exercisable | Exercise | date of grant | |||||||||||
of participant | Date of grant | 1 July 2018 | Year | Year | Year | 2019 | period | price | of options | ||||||||||
HK$ | HK$ | ||||||||||||||||||
(a) | Director | ||||||||||||||||||
Mr. Mu Dongsheng | 14 October 2015 | 13,000,000 | - | - | - | 13,000,000 | 14 | October 2015 to | 0.300 | 0.300 | |||||||||
13 | October 2019 | ||||||||||||||||||
(b) | Eligible employees | 8 January 2014 | 12,891,840 | - | - | (12,891,840) | - | 8 | January 2014 to | 0.587 | 0.600 | ||||||||
7 | January 2019 | ||||||||||||||||||
9 January 2015 | 17,576,000 | - | - | (1,768,000) | 15,808,000 | 9 | January 2015 to | 0.560 | 0.550 | ||||||||||
8 | January 2020 | ||||||||||||||||||
14 October 2015 | 61,000,000 | - | - | - | 61,000,000 | 14 | October 2015 to | 0.300 | 0.300 | ||||||||||
13 | October 2019 | ||||||||||||||||||
(c) | Eligible consultants | 8 January 2014 | 38,896,000 | - | - | (38,896,000) | - | 8 | January 2014 to | 0.587 | 0.600 | ||||||||
7 | January 2019 | ||||||||||||||||||
9 January 2015 | 88,816,000 | - | - | (8,320,000) | 80,496,000 | 9 | January 2015 to | 0.560 | 0.550 | ||||||||||
8 | January 2020 | ||||||||||||||||||
14 October 2015 | 13,000,000 | - | - | - | 13,000,000 | 14 | October 2015 to | 0.300 | 0.300 | ||||||||||
13 | October 2019 | ||||||||||||||||||
245,179,840 | - | - | 61,875,840 | 183,304,000 | |||||||||||||||
The Company has not adopted any share option scheme other than the Existing Share Option Scheme. The Directors confirm that no further Options will be granted under the Existing Share Option Scheme prior to the date of AGM.
The New Share Option Scheme
The purpose of the New Share Option Scheme is to replace the Existing Share Option Scheme and to enable the Company with the flexibility to continue to grant Options to the Eligible Participants who, in the sole discretion of the Board, have made or may make contribution to the Group as well as to provide incentives and help the Group in retaining its existing employees and recruiting additional employees and to provide them with a direct economics interest in attaining the long term business objectives of the Group.
Save for the necessary modifications and/or amendments made pursuant to the Listing Rules, there will be no material difference between the terms of the Existing Share Option Scheme and the proposed New Share Option Scheme.
Set out on pages 13 to 28 of this circular are the principal terms of the New Share Option Scheme. The rules of the New Share Option Scheme proposed to be adopted by the Company at the AGM will be available for inspection at the principal place of business in Hong Kong at Units 314-315, Wing On Plaza, 62 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong during normal business hours from the Latest Practicable Date up to and including the date of AGM.
- 9 -
LETTER FROM THE BOARD
The maximum number of Shares which may be allotted and issued upon exercise of all outstanding options granted under the New Share Option Scheme and any other share option schemes of the Company (including the Existing Share Option Scheme) may represent up to 10% of the Shares in issue on the date of approval of the New Share Option Scheme by the Shareholders at the AGM (the "General Scheme Limit"), which maximum number may however be refreshed as detailed in paragraph 8.2 of "Principal Terms of the New Share Option Scheme" to this circular.
As at the Latest Practicable Date, there were 2,884,091,737 Shares in issue. Assuming that there is no change in the issued share capital of the Company between the period from the Latest Practicable Date and the Adoption Date, the number of Shares that may be issued pursuant to the New Share Option Scheme will be 288,409,173 Shares, being 10% of the issued shares of the Company as at the Latest Practicable Date.
The maximum number of Shares which may be allotted and issued upon exercise of all outstanding Options granted and yet to be exercised under the New Share Option Scheme and any other share option schemes adopted by the Group shall not exceed 30% of the issued shares of the Company in issue from time to time. And no Options may be granted under the New Share Option Scheme or any other share option scheme adopted by the Group if the grant of such Option will result in the limit above being exceeded.
To the best knowledge of the Directors, as at the Latest Practicable Date, no Shareholders have a material interest in the New Share Option Scheme different to that of any other Shareholders and accordingly, no Shareholders will have to abstain from voting at the AGM on the resolution approving the adoption of the New Share Option Scheme.
Conditions of the adoption of New Share Option Scheme
The adoption of the New Share Option Scheme is conditional upon (i) the passing of an ordinary resolution by the Shareholders approving the adoption of New Share Option Scheme; and
- the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the Shares which may be allotted and issued pursuant to the exercise of options which may be granted under the New Share Option Scheme.
Application will be made to the Listing Committee of the Stock Exchange for the approval of the listing of, and permission to deal in, the Shares representing 10% of the issued shares of the Company as at the date of the AGM which may fall to be allotted and issued upon the exercise of options to be granted under the New Share Option Scheme.
- 10 -
LETTER FROM THE BOARD
Reasons for the proposal
The purpose of New Share Option Scheme is to enable the Company to grant Options to the Eligible Participants as incentives or rewards for their contribution to the Group. The Directors consider that the adoption of the New Share Option Scheme is in the interest of the Company and the Shareholders as a whole because it enables the Company to reward and provide incentives to, and strengthen the Group's business relationship with, the prescribed classes of participants who may contribute to the growth and development of the Group.
Values of all options that can be granted under the New Share Option Scheme
The Directors consider that it is not possible to state the value of all options that may be granted pursuant to the New Share Option Scheme as if they had been granted on the Latest Practicable Date, because the calculation of the value of the options is based on a number of variables such as the exercise price, exercise period, interest rate, expected volatility and other relevant variables. As options have not been granted under the New Share Option Scheme, certain variables are not available for calculating the value of the options. The Directors believe that any calculation of the value of the options as at the Latest Practicable Date based on a great number of speculative assumptions would not be meaningful to the Shareholders.
5. ANNUAL GENERAL MEETING
The notice of the AGM is set out on pages 29 to 32 of this circular. At the AGM, resolutions will be proposed to approve, inter alia , the granting of the Issue Mandate and the re-election of retiring Directors.
A form of proxy for use at the AGM is enclosed with this circular and such form of proxy is also published on the website of the Stock Exchange (www.hkex.com.hk). In order to be valid, the form of proxy must be completed and signed in accordance with the instructions printed thereon and deposited at the Company's Hong Kong branch share registrar and transfer office, Hong Kong Registrars Limited of 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, together with a power of attorney or other authority, if any, under which it is signed or a certified copy of such power or authority, not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof. The completion and return of the form of proxy will not preclude any Shareholder from attending and voting at the meeting or any adjournment thereof if so wished.
- 11 -
LETTER FROM THE BOARD
6. VOTING BY WAY OF POLL
Pursuant to Rule 13.39(4) of the Listing Rules, all votes of Shareholders at general meetings must be taken by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. The chairman of the AGM will therefore demand a poll for every resolution put to the vote of the AGM pursuant to article 66 of the Articles of Association. The results of poll will be published on the websites of the Stock Exchange and the Company after the AGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.
7. RECOMMENDATION
The Directors consider that the Issue Mandate and the re-election of the retiring Directors are in the best interests of the Company and the Shareholders. The Directors therefore recommend the Shareholders to vote in favour of the relevant resolutions as set out in the notice of the AGM on pages 29 to 32 of this circular.
8. RESPONSIBILITY STATEMENT
This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.
Yours faithfully,
For and on behalf of
Kingwell Group Limited
Mu Dongsheng
Chairman
- 12 -
APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
Set out below is a summary of the principal terms and conditions of the New Share Option Scheme to provide sufficient information to the Shareholders for their consideration of the New Share Option Scheme proposed to be adopted at the AGM. The terms of the New Share Option Scheme are in accordance with the provisions of Chapter 17 of the Listing Rules.
- DEFINITIONS
- Capitalized terms used in this section shall have the same meaning as defined on page 1 to 3 in this circular unless otherwise stated.
- CONDITIONS
- The New Share Option Scheme is conditional upon:
- the Listing Committee of the Stock Exchange granting the listing of and permission to deal in such number of Shares representing the General Mandate Limit (as defined in paragraph 8.2) to be allotted and issued by the Company pursuant to the exercise of Options in accordance with the terms and conditions of the Scheme; and
- the passing of the necessary resolution to approve and adopt the Scheme in general meeting of the Company.
- PURPOSE, DURATION AND ADMINISTRATION
- The Scheme is formulated specifically for the purpose of further improving corporate compensation administration system, linking the interests of corporate management staff, core employees and business backbone to the interest of the Company, maintaining a long- term relationship with the external consulting teams of the Company, attracting and retaining core talents, so as to enhance the competitive strengths of the Company and promote its sustainable development.
- The principles of the Scheme is as follows:
- to reasonably determine the number of stock options allocated to Eligible Participants to avoid biased distribution;
- to reasonably determine the allocation proportion to ensure that every Eligible Participants can share the operating results of the Company according to actual efforts contributed;
- to determine the incentive method of the Company that is easy to operate and have incentive effect; and
- to reasonably determine the incentive cycle that would not make Eligible Employees feel unreachable and avoid certain short-term behaviour of them.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- The New Share Option Scheme shall be subject to the administration of the Directors whose decision on all matters arising in relation to the Scheme or their interpretation or effect shall (save for the grant of Options referred to in paragraph 4.4 which shall be approved in the manner referred to therein and save as otherwise provided herein) be final and binding on all persons who may be affected thereby.
- Subject to paragraphs 2 and 14, the New Share Option Scheme shall be valid and effective until the Termination Date, after which period no further Options may be issued but the provisions of the Scheme shall remain in force to the extent necessary to give effect to the exercise of any Options granted or exercised prior thereto or otherwise as may be required in accordance with the provisions of the Scheme.
- A Grantee shall ensure that the acceptance of an Offer, the holding and exercise of his Option in accordance with the New Share Option Scheme, the allotment and issue of Shares to him upon the exercise of his Option and the holding of such Shares are valid and comply with all laws, legislation and regulations including all applicable exchange control, fiscal and other laws to which he is subject. The Directors may, as a condition precedent of making an Offer and allotting Shares upon an exercise of an Option, require an Eligible Participant or a Grantee (as the case may be) to produce such evidence as it may reasonably require for such purpose.
4. GRANT OF OPTIONS
- Subject to paragraph 4.4, the Directors shall, in accordance with the provisions of the Scheme and the Listing Rules, be entitled but shall not be bound at any time within a period of ten (10) years commencing from the Adoption Date to make an Offer to any person belonging to the following classes of participants to subscribe, and no person other than the Eligible Participant named in such Offer may subscribe, for such number of Shares (being a board lot for dealings in the Shares on the Stock Exchange or an integral multiple thereof) at such Subscription Price as the Directors shall, subject to paragraph 5, determine:
- any Eligible Employee;
- any non-executive directors (including independent non-executive directors) of the Group; and
- any adviser (professional or otherwise) or consultant to any area of business or business development of the Group,
and, for the purposes of the Scheme, the Offer may be made to any company wholly owned by one or more Eligible Participants.
For the avoidance of doubt, the grant of any options by the Company for the subscription of Shares or other securities of the Group to any person who falls within any of the above classes of Eligible Participants shall not, by itself, unless the Directors otherwise determine, be construed as a grant of Option under the New Share Option Scheme.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- The basis of determining the eligibility of the Eligible Participants by inspecting three aspects, such as the added value of human capital, historical contribution and level of difficulty in replacement. The incentive momentum should be comprehensively determined after conducting the value assessment for human capital and consider as a whole regarding the realization of corporate results and individual performance. The different basis of determining the eligibility of the Eligible Participants is as follows:
- Eligible Employee: the employee who can generate significant impact on the sustainable development of the Company in the future; the employee should served the Company for more than one year and have made outstanding contributions to the growth in business performance or improvement in management capability of the Company; and the employee should hold the core of trade secrets and know-how.
- Non-executivedirectors of the Group: the director who can generate significant impact on the sustainable development of the Company in the future; the director should served the Company for more than one year and have made outstanding contributions to the growth in business performance or improvement in management capability of the Company; and the director should hold the core of trade secrets and know-how.
- External Adviser or consultant of the Group: the external adviser who can generate significant impact on the sustainable development of the Company in the future; the adviser should served the Company for more than five years and have made outstanding contributions to the growth in business performance or improvement in management capability of the Company; and the adviser should hold the core of trade secrets and know-how.
- Based on the equity-based incentive principles and qualifications accreditation standards, the Company will divide the Eligible Participants into three aspects and determine the equity proportion allocations:
Primary aspect: Core managements including directors and senior management who are strategic decision-makers of the Company, representing 45%;
Secondary aspect: Operating management including management staff holding the position as department manager or above and backbone staff who are employees making persistent and core contributions to the Company, representing 50%;
Tertiary aspect: External consulting teams of the Company who are external parties providing professional guidance and assistance to the operation of the Company, making consistent contributions to the development of the Company for not less than five years or above, making no annual upward adjustment to fee charges in light of actual inflationary situation while receiving professional service fees, demonstrating more competitiveness when comparing their relevant service teams, quotation and service quality provided with the market, and maintaining friendly-relationship with the Company, representing 5%.
The proportion allocation of options will be generally implemented according to the bases above. There is no assurance that incentives will be granted to each aspect during actual implementation, and the Company will make adjustment within the proportional range based on practical circumstances.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- Without prejudice to paragraph 8.4 below, the making of an Offer to any Director, chief executive or substantial shareholder of the Company, or any of their respective associates must be approved by the independent non-executive Directors (excluding any independent non-executive Director who or whose associate is the proposed Grantee of an Option).
- The eligibility of any of the Eligible Participants to an Offer shall be determined by the Directors from time to time on the basis of the Directors' opinion as to his contribution to the development and growth of the Group.
- An Offer shall be made to an Eligible Participant in writing (and unless so made shall be invalid) in such form as the Directors may from time to time determine, either generally or on a case-by-case basis, specifying the number of Shares under the Option and the Option Period in respect of which the Offer is made and further requiring the Eligible Participant to undertake to hold the Option on the terms on which it is to be granted and to be bound by the provisions of the Scheme and shall remain open for acceptance by the Eligible Participant concerned (and by no other person) for a period of up to 7 days from the Offer Date or such other period as the Board may decide from the date on which the letter containing the Offer is delivered to that Eligible Participant.
- An Offer shall state, in addition to the matters specified in paragraph 4.6, the following:
- the name, address and position of the Eligible Participant;
- the number of Shares under the Option in respect of which the Offer is made and the Subscription Price for such Shares;
- the Option Period in respect of which the Offer is made or, as the case may be, the Option Period in respect of separate parcels of Shares under the Option comprised in the Offer;
- the last date by which the Offer must be accepted (which may not be later than 7 days from the Offer Date or such other period as the Board may decide from the date on which the letter containing the Offer is delivered to that Eligible Participant);
- the procedure for acceptance;
- the performance target(s) (if any) that must be attained by the Eligible Participant before any Option can be exercised;
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- such other terms and conditions of the Offer as may be imposed by the Directors as are not inconsistent with the Scheme; and
- a statement requiring the Eligible Participant to undertake to hold the Option on the terms on which it is to be granted and to be bound by the provisions of the Scheme including, without limitation, the conditions specified in paragraphs 3.4, 6.1, 15.8 to 15.11, inclusive.
- An Offer shall have been accepted by an Eligible Participant in respect of all Shares under the Option which are offered to such Eligible Participant when the duplicate letter comprising acceptance of the Offer duly signed by the Eligible Participant together with a remittance in favour of the Company of HK$1.00 by way of consideration for the grant thereof is received by the Company within such time as may be specified in the Offer (which shall not be later than 7 days from the Offer Date or such other period as the Board may decide from the date on which the letter containing the Offer is delivered to that Eligible Participant). Such remittance shall in no circumstances be refundable.
- Any Offer may be accepted by an Eligible Participant in respect of less than the number of Shares under the Option which are offered provided that it is accepted in respect of a board lot for dealings in the Shares on the Stock Exchange or an integral multiple thereof and such number is clearly stated in the duplicate letter comprising acceptance of the Offer duly signed by such Eligible Participant and received by the Company together with a remittance in favour of the Company of HK$1.00 by way of consideration for the grant thereof within such time as may be specified in the Offer (which shall not be later than 7 days from the Offer Date or such other period as the Board may decide from the date on which the letter containing the Offer is delivered to that Eligible Participant). Such remittance shall in no circumstances be refundable.
- Upon an Offer being accepted by an Eligible Participant in whole or in part in accordance with paragraph 4.8 or 4.9, an Option in respect of the number of Shares in respect of which the Offer was so accepted will be deemed to have been granted by the Company to such Eligible Participant on the Offer Date. To the extent that the Offer is not accepted within the time specified in the Offer in the manner indicated in paragraph 4.8 or 4.9, it will be deemed to have been irrevocably declined.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- The Option Period of an Option may not end later than ten (10) years after the Offer Date of that Option.
- Options will not be listed or dealt in on the Stock Exchange.
- For so long as the Shares are listed on the Stock Exchange:
- an Offer may not be made after an inside information event has occurred or an inside information matter has been the subject of a decision until such inside information has been announced in accordance with the requirements of the Listing Rules. In particular, during the period commencing one month immediately preceding the earlier of:
- the date of the board meeting (as such date is first notified to the Stock Exchange in accordance with the Listing Rules) for the approval of the Company's results for any year, half-year, quarter or any other interim period) whether or not required under the Listing Rules); and
- the deadline for the Company to publish an announcement of its results for any year or half-year, quarter or any other interim period (whether or not required under the Listing Rules),
and ending on the date of the results announcement, no Offer may be made; and
- the Directors may not make any Offer to an Eligible Participant who is subject to the Model Code during the periods or times in which such Eligible Participant is prohibited from dealing in Shares pursuant to the Model Code.
5. SUBSCRIPTION PRICE
The Subscription Price in respect of any Option shall, subject to any adjustments made pursuant to paragraph 9, be at the discretion of the Directors, provided that it shall not be less than the highest of:
- the closing price of the Shares as stated in the Stock Exchange's daily quotations sheet for trade in one or more board lots of the Shares on the Offer Date;
- the average closing price of the Shares as stated in the Stock Exchange's daily quotations sheets for the five Business Days immediately preceding the Offer Date; and
- the nominal value of a Share.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
6. EXERCISE OF OPTIONS
- An Option shall be personal to the Grantee and shall not be transferable or assignable and no Grantee shall in any way sell, transfer, charge, mortgage, encumber or otherwise dispose of or create any interest whatsoever in favour of any third party over or in relation to any Option or enter into any agreement so to do. Any breach of the foregoing by a Grantee shall entitle the Company to cancel any Option granted to such Grantee to the extent not already exercised.
- Unless otherwise determined by the Directors and stated in the Offer to a Grantee, a Grantee is not required to hold an Option for any minimum period nor achieve any performance targets before the exercise of an Option granted to him.
- Subject to paragraphs 3.4 and 15.8 and the fulfillment of all terms and conditions set out in the Offer, including the attainment of any performance targets stated therein (if any), an Option shall be exercisable in whole or in part in the circumstances and in the manner as set out in paragraphs 6.4 and 6.5 by giving notice in writing to the Company stating that the Option is thereby exercised and the number of Shares in respect of which it is so exercised (which, except where the number of Shares in respect of which the Option remains unexercised is less than one board lot or where the Option is exercised in full, must be for a board lot for dealings in Shares on the Stock Exchange or an integral multiple thereof). Each such notice must be accompanied by a remittance for the full amount of the Subscription Price for Shares in respect of which the notice is given. Within 10 business days after receipt of the notice and, where appropriate, receipt of the certificate of the auditors or the independent financial advisers pursuant to paragraph 9, the Company shall accordingly allot and issue the relevant number of Shares to the Grantee (or, in the event of an exercise of Option by a Personal Representative pursuant to paragraph 6.4(a), to the estate of the Grantee) fully paid and issue to the Grantee (or his estate in the event of an exercise by his Personal Representative as aforesaid) a share certificate for every board lot of Shares so allotted and issued and a share certificate for the balance (if any) of the Shares so allotted and issued which do not constitute a board lot.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
6.4 Subject as hereinafter provided, an Option may (and may only) be exercised by the Grantee at any time or times during the Option Period provided that:
- if the Grantee is an Eligible Employee and in the event of his ceasing to be an Eligible Employee by reason of his death in accordance with his contract of employment before exercising the Option in full, his Personal Representative(s) or, as appropriate, the Grantee may exercise the Option (to the extent not already exercised) in whole or in part in accordance with the provisions of paragraph 6.3 within a period of 12 months following the date of cessation of employment which date shall be the last day on which the Grantee was at work with the Company or the relevant Subsidiary whether salary is paid in lieu of notice or not, or such longer period as the Directors may determine or, if any of the events referred to in paragraph 6.4(c) or 6.4(d) occur during such period, exercise the Option pursuant to paragraph 6.4(c) or 6.4(d) respectively;
- if the Grantee is an Eligible Employee and in the event of his ceasing to be an Eligible Employee for any reason other than his death, ill-health or retirement in accordance with his contract of employment or the termination of his employment on one or more of the grounds specified in paragraph 7.1(c) before exercising the Option in full, the Option shall lapse on the date of cessation of such employment and not be exercisable unless the Board otherwise determines in which event the Option shall be exercisable to the extent and within such period as the Board may determine. The date of cessation or termination as aforesaid shall be the last day on which the Grantee was actually at work with the Company or the relevant Subsidiary whether salary is paid in lieu of notice or not;
- if a general or partial offer, whether by way of take-over offer, share re-purchase offer, or scheme of arrangement or otherwise in like manner is made to all the holders of the Shares, or all such holders other than the offeror and/or any person controlled by the offeror and/or any person acting in association or concert with the offeror, the Company shall use all reasonable endeavours to procure that such offer is extended to all the Grantees on the same terms, mutatis mutandis, and assuming that they will become, by the exercise in full of the Options granted to them, shareholders of the Company. If such offer becomes or is declared unconditional or such scheme of arrangement is formally proposed to shareholders in the Company, the Grantee shall, notwithstanding any other terms on which his Options were granted, be entitled to exercise the Option (to the extent not already exercised) to its full extent or to the extent specified in the Grantee's notice to the Company in accordance with the provisions of paragraph 6.3 at any time thereafter and up to the close of such offer (or any revised offer) or the record date for entitlements under scheme of arrangement, as the case may be;
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- in the event of a resolution being proposed for the voluntary winding-up of the Company during the Option Period, the Grantee may, subject to the provisions of all applicable laws, by notice in writing to the Company at any time thereafter (but before such time as shall be notified by the Company), exercise his Option (to the extent not already exercised) either to its full extent or to the extent specified in such notice in accordance with the provisions of paragraph 6.3 and the Company shall allot and issue to the Grantee the Shares in respect of which such Grantee has exercised his Option not less than three (3) days before the date on which such resolution is to be considered and/or passed whereupon he shall accordingly be entitled, in respect of the Shares allotted and issued to him in the aforesaid manner, to participate in the distribution of the assets of the Company available in liquidation pari passu with the holders of the Shares in issue on the day prior to the date of such resolution. Subject thereto, all Options then outstanding shall lapse and determine on the commencement of the winding-up; and
- if the Grantee is a company wholly owned by one or more Eligible Participants:
- the provisions of paragraphs 6.4(a), 6.4(b), 7.1(c) and 7.1(d) shall apply to the Grantee and to the Options granted to such Grantee, mutatis mutandis, as if such Options had been granted to the relevant Eligible Participant, and such Options shall accordingly lapse or fall to be exercisable after the event(s) referred to in paragraphs 6.4(a), 6.4(b), 7.1(c) and 7.1(d) shall occur with respect to the relevant Eligible Participant; and
- the Options granted to the Grantee shall lapse and determine on the date the Grantee ceases to be wholly owned by the relevant Eligible Participant provided that the Directors may in their absolute discretion decide that such Options or any part thereof shall not so lapse or determine subject to such conditions or limitations as they may impose.
6.5 Shares to be allotted and issued upon the exercise of an Option will be subject to all the provisions of the Articles of Association for the time being in force and will rank pari passu in all respects with the then existing fully paid Shares in issue on the date on which the Option is duly exercised or, if that date falls on a day when the register of members of the Company is closed, the first day of the re-opening of the register of members ("Exercise Date") and accordingly will entitle the holders thereof to participate in all dividends or other distributions paid or made on or after the Exercise Date other than any dividend or other distribution previously declared or recommended or resolved to be paid or made if the record date therefor shall be before the Exercise Date. A Share allotted and issued upon the exercise of an Option shall not carry voting rights until the name of the Grantee has been duly entered on the register of members of the Company as the holder thereof.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
7. EARLY TERMINATION OF OPTION PERIOD
- The Option Period in respect of any Option shall automatically terminate and that Option (to the extent not already exercised) shall lapse on the earliest of:
- the expiry of the Option Period;
- the expiry of any of the periods referred to in paragraph 6.4;
- in respect of a Grantee who is an Eligible Employee, the date on which the Grantee ceases to be an Eligible Employee by reason of a termination of his employment on the grounds that he has been guilty of persistent or serious misconduct, or has committed any act of bankruptcy or has become insolvent or has made any arrangement or composition with his creditors generally, or has been convicted of any criminal offence (other than an offence which in the opinion of the Directors does not bring the Grantee or the Group into disrepute);
- in respect of a Grantee other than an Eligible Employee, the date on which the Directors shall at their absolute discretion determine that (i)(aa) such Grantee or his associate has committed any breach of any contract entered into between such Grantee or his associate on the one part and the Group on the other part; or (bb) such Grantee has committed any act of bankruptcy or has become insolvent or is subject to any winding-up, liquidation or analogous proceedings or has made any arrangement or composition with his creditors generally; or (cc) such Grantee could no longer make any contribution to the growth and development of the Group by reason of the cessation of its relations with the Group or by any other reason whatsoever; and (ii) the Option shall lapse as a result of any event specified in sub-paragraph (aa), (bb) or (cc) above; and
- the date on which the Directors shall exercise the Company's right to cancel the Option by reason of a breach of paragraph 6.1 by the Grantee in respect of that or any other Option.
- A resolution of the Directors to the effect that the employment of a Grantee has been terminated on one or more of the grounds specified in paragraph 7.1(c) or that any event referred to in paragraph 7.1(d)(i) has occurred shall be conclusive and binding on all persons who may be affected thereby.
- Transfer of employment of a Grantee who is an Eligible Employee from one member of the Group to another member of the Group shall not be considered a cessation of employment. It shall not be considered a cessation of employment if a Grantee who is an Eligible Employee is placed on such leave of absence which is considered by the directors of the relevant member of the Group not to be a cessation of employment of the Grantee.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
8. MAXIMUM NUMBER OF SHARES AVAILABLE FOR SUBSCRIPTION
- The maximum number of Shares which may be allotted and issued upon exercise of all outstanding Options granted and yet to be exercised under the Scheme and any other share option schemes adopted by the Group shall not exceed 30%. of the share capital of the Company in issue from time to time. No options may be granted under the Scheme or any other share option scheme adopted by the Group if the grant of such option will result in the limit referred to in this paragraph 8.1 being exceeded.
- The total number of Shares which may be allotted and issued upon exercise of all Options (excluding, for this purpose, options which have lapsed in accordance with the terms of the Scheme and any other share option scheme of the Group) to be granted under the Scheme and any other share option scheme of the Group must not in aggregate exceed 10%. of the Shares in issue at the time dealings in the Shares first commence on the Stock Exchange ("General Mandate Limit") provided that:
- subject to paragraph 8.1 and without prejudice to paragraph 8.2(b), the Company may seek approval of its shareholders in general meeting to refresh the General Mandate Limit provided that the total number of Shares which may be allotted and issued upon exercise of all Options to be granted under the Scheme and any other share option scheme of the Group must not exceed 10%. of the Shares in issue as at the date of approval of the limit and for the purpose of calculating the limit, options (including those outstanding, cancelled, lapsed or exercised in accordance with the Scheme and any other share option scheme of the Group) previously granted under the Scheme and any other share option scheme of the Group will not be counted; and
- subject to paragraph 8.1 and without prejudice to paragraph 8.2(a), the Company may seek separate shareholders' approval in general meeting to grant Options under the Scheme beyond the General Mandate Limit or, if applicable, the extended limit referred to in paragraph 8.2(a) to Eligible Participants specifically identified by the Company before such approval is sought.
- Subject to paragraph 8.4, the total number of Shares issued and which may fall to be issued upon exercise of the Options and the options granted under any other share option scheme of the Group (including both exercised or outstanding options) to each Grantee in any 12-month period shall not exceed 1%. of the issued share capital of the Company for the time being. Where any further grant of Options to a Grantee under the Scheme would result in the Shares issued and to be issued upon exercise of all options granted and proposed to be granted to such person (including exercised, cancelled and outstanding options) under the Scheme and any other share option schemes of the Group in the 12-month period up to and including the date of such further grant representing in aggregate over 1%. of the Shares in issue, such further grant must be separately approved by shareholders of the Company in general meeting with such Grantee and his associates abstaining from voting.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
8.4 Without prejudice to paragraph 4.4, where any grant of Options to a substantial shareholder or an independent non-executive Director or any of their respective associates, would result in the Shares issued and to be issued upon exercise of all Options already granted and to be granted (including Options exercised, cancelled and outstanding) to such person in the
12-month period up to and including the date of such grant:
- representing in aggregate over 0.1%. of the Shares in issue; and
- having an aggregate value, based on the closing price of the Shares at the Offer Date of each Offer, in excess of HK$5 million;
such further grant of options must be approved by the shareholders of the Company in general meeting.
- For the purpose of seeking the approval of the shareholders of the Company under paragraphs 8.2, 8.3 and 8.4, the Company must send a circular to the shareholders containing the information required under the Listing Rules and where the Listing Rules shall so require, the vote at the shareholders' meeting convened to obtain the requisite approval shall be taken on a poll with those persons required under the Listing Rules abstaining from voting.
- Shareholders' approval as required under paragraph 8.4 is also required for any change in terms of options granted to an Eligible Participant who is a substantial shareholder of the Company or an independent non-executive Director, or any of their respective associates.
9. ADJUSTMENTS TO THE SUBSCRIPTION PRICE
- In the event of any alteration in the capital structure of the Company whilst any Option remains exercisable or the Scheme remains in effect, and such event arises from a capitalisation of profits or reserves, rights issue, consolidation or subdivision of the Shares, or reduction of the share capital of the Company, then, in any such case the Company shall instruct the auditors or an independent financial adviser to certify in writing the adjustment, if any, that ought in their opinion fairly and reasonably to be made either generally or as regards any particular Grantee, to:
- the number or nominal amount of Shares to which the Scheme or any Option(s) relates (insofar as it is/they are unexercised); and/or
- the Subscription Price of any Option; and/or
- (unless the relevant Grantee elects to waive such adjustment) the number of Shares comprised in an Option or which remain comprised in an Option,
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
and an adjustment as so certified by such auditors or independent financial adviser shall be made, provided that:
- any such adjustment shall give the Grantee the same proportion of the issued share capital of the Company for which such Grantee would have been entitled to subscribe had he exercised all the Options held by him immediately prior to such adjustment;
- no such adjustment shall be made the effect of which would be to enable a Share to be issued at less than its nominal value;
- the issue of Shares or other securities of the Group as consideration in a transaction shall not be regarded as a circumstance requiring any such adjustment; and
- any such adjustment shall be made in compliance with such rules, codes and guidance notes of the Stock Exchange from time to time.
In respect of any adjustment referred to in this paragraph 9.1, other than any adjustment made on a capitalisation issue, such auditors or independent financial adviser must confirm to the Directors in writing that the adjustments satisfy the requirements of the relevant provisions of the Listing Rules.
- If there has been any alteration in the capital structure of the Company as referred to in paragraph 9.1, the Company shall, upon receipt of a notice from a Grantee in accordance with paragraph 6.3, inform the Grantee of such alteration and shall either inform the Grantee of the adjustment to be made in accordance with the certificate of such auditors or the independent financial adviser obtained by the Company for such purpose or, if no such certificate has yet been obtained, inform the Grantee of such fact and instruct such auditors or the independent financial adviser as soon as practicable thereafter to issue a certificate in that regard in accordance with paragraph 9.1.
- In giving any certificate under this paragraph 9, such auditors or the independent financial adviser appointed under paragraph 9.1 shall be deemed to be acting as experts and not as arbitrators and their certificate shall, in the absence of manifest error, be final, conclusive and binding on the Company and all persons who may be affected thereby.
10. CANCELLATION OF OPTIONS
- Subject to paragraph 6.1 and Chapter 17 of the Listing Rules, any Option granted but not exercised may not be cancelled except with the prior written consent of the relevant grantee and the approval of the Directors.
- Where the Company cancels any Option granted to a Grantee but not exercised and issues new Option(s) to the same Grantee, the issue of such new Option(s) may only be made with available unissued Options (excluding, for this purpose, the Options so cancelled) within the General Mandate Limit or the limits approved by the shareholders of the Company pursuant to paragraph 8.2(a) or 8.2(b).
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- SHARE CAPITAL
The exercise of any Option shall be subject to the shareholders of the Company in general meeting approving any necessary increase in the authorised share capital of the Company. Subject thereto, the Directors shall make available sufficient authorised but unissued share capital of the Company to allot and issue the Shares on the exercise of any Option. - DISPUTES
Any dispute arising in connection with the number of Shares the subject of an Option, or any adjustment under paragraph 9.1 shall be referred to the decision of the auditors who shall act as experts and not as arbitrators and whose decision shall, in the absence of manifest error, be final, conclusive and binding on all persons who may be affected thereby. - ALTERATION OF THE SCHEME
- The terms and conditions of the Scheme relating to the matters set out in Rule 17.03 of the Listing Rules shall not be altered to the advantage of grantees of the options except with the approval of the Shareholders in general meeting.
- Any alterations to the terms and conditions of the Scheme which are of a material nature or any change to the terms of options granted must be approved by the Shareholders in general meeting. No alteration will take effect automatically under the existing terms of the Scheme.
- The amended terms of the Scheme or the options must still comply with the relevant requirements of Chapter 17 of the Listing Rules.
- Any change to the authority of the Directors or the scheme administrators in relation to any alteration to the terms of the Scheme shall be approved by the Shareholders in general meeting.
- TERMINATION
- The Company by resolution in general meeting may at any time terminate the operation of the Scheme and in such event no further Options will be offered but in all other respects the provisions of the Scheme shall remain in force to the extent necessary to give effect to the exercise of any Options (to the extent not already exercised) granted prior thereto or otherwise as may be required in accordance with the provisions of the Scheme and Options (to the extent not already exercised) granted prior to such termination shall continue to be valid and exercisable in accordance with the Scheme.
- Upon such termination, details of the Options granted (including Options exercised or outstanding) under the Scheme are required under the Listing Rules to be disclosed in the circular to shareholders seeking approval of the first new scheme established thereafter.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
15. MISCELLANEOUS
- The Scheme shall not form part of any contract of employment between the Company, any Subsidiary and any Eligible Employee and the rights and obligations of any Eligible Employee under the terms of his office or employment shall not be affected by his participation in the Scheme or any right which he may have to participate in it and the Scheme shall afford such an Eligible Employee no additional rights to compensation or damages in consequence of the termination of such office or employment for any reason.
- The Scheme shall not confer on any person any legal or equitable rights (other than those constituting the Options themselves) against the Company directly or indirectly or give rise to any cause of action at law or in equity against the Company.
- The Company shall bear the costs of establishing and administering the Scheme, including any costs of the auditors or any independent financial adviser in relation to the preparation of any certificate by them or provision of any other service in relation to the Scheme.
- A Grantee shall be entitled to receive copies of all notices and other documents sent by the Company to Shareholders at the same time or within a reasonable time of any such notices or documents being sent to Shareholders.
- Any notice or other communication between the Company and a Grantee may be given by sending the same by prepaid post or by personal delivery to, in the case of the Company, its principal place of business in Hong Kong and, in the case of the Grantee, his address in Hong Kong as notified to the Company from time to time or, if none or incorrect or out of date, his last place of employment with the Company or the Company's principal place of business in Hong Kong from time to time.
- Any notice or other communication if sent by the Grantee shall be irrevocable and shall not be effective until actually received by the Company.
- Any notice or other communication if sent to the Grantee shall be deemed to be given or made:
- one (1) day after the date of posting, if sent by mail; and
- when delivered, if delivered by hand.
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APPENDIX I | PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME |
- A Grantee shall, before accepting an Offer or exercising his Option, obtain all necessary consents that may be required to enable him to accept the Offer or to exercise the Option and the Company to allot and issue to him in accordance with the provisions of the Scheme the Shares falling to be allotted and issued upon the exercise of his Option. By accepting an Offer or exercising his Option, the Grantee thereof is deemed to have represented to the Company that he has obtained all such consents. Compliance with this paragraph shall be a condition precedent to an acceptance of an Offer by a Grantee and an exercise by a Grantee of his Options. A Grantee shall indemnify the Company fully against all claims, demands, liabilities, actions, proceedings, fees, costs and expenses which the Company may suffer or incur (whether alone or jointly with other party or parties) for or in respect of any failure on the part of the Grantee to obtain any necessary consent or to pay tax or other liabilities referred therein.
- A Grantee shall pay all tax and discharge all other liabilities to which he may become subject as a result of his participation in the Scheme or the exercise of any Option.
- By accepting an Offer, an Eligible Participant shall be deemed irrevocably to have waived any entitlement, by way of compensation for loss of office or otherwise howsoever, to any sum or other benefit to compensate him for loss of any rights under the Scheme.
- The Scheme and all Options granted hereunder shall be governed by and construed in accordance with the laws of Hong Kong.
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NOTICE OF ANNUAL GENERAL MEETING
KINGWELL GROUP LIMITED
京 維 集 團 有 限 公 司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1195)
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Kingwell Group Limited (the "Company") will be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 12 December 2019 at 11:00 a.m. for the following purposes:
ORDINARY RESOLUTIONS
- to receive and consider the audited consolidated financial statements and the reports of the directors and the auditor for the year ended 30 June 2019;
- to re-elect the retiring directors and to authorise the board of directors to fix their remuneration;
- to re-appoint Ernst & Young as auditor of the Company and to authorise the board of directors to fix their remuneration; and
- as special businesses, to consider, and if thought fit, pass the following ordinary resolutions: "THAT
- subject to paragraph (c) below, the exercise by the directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional Shares and to make or grant offers, agreements and options which might require the exercise of such power be and is hereby generally and unconditionally approved;
- the approval in paragraph (a) shall authorise the directors of the Company during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such power after the end of the Relevant Period;
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NOTICE OF ANNUAL GENERAL MEETING
- the total number of issued shares allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the directors of the Company pursuant to the approval in paragraph (a), otherwise than pursuant to (i) a Rights Issue (as hereinafter defined) or (ii) the exercise of the subscription rights or conversion under the terms of any warrants or other securities issued by the Company as at the date of this resolution carrying a right to subscribe for or purchase Shares or otherwise convertible into Shares, or (iii) the exercise of the subscription rights under the share option scheme of the Company, or (iv) any scrip dividend or similar arrangements providing for the allotment of Shares in lieu of the whole or part of a dividend on Shares in accordance with the memorandum and articles of association of the Company, from time to time shall not exceed 20% of the total number of issued shares of the Company as at the date of passing of this Resolution and the said approval shall be limited accordingly; and
-
for the purposes of this resolution:
"Relevant Period" means the period from the passing of this Resolution until whichever is the earliest of: - the conclusion of the next annual general meeting of the Company;
- the expiration of the period within which the next annual general meeting of the Company required by the Articles of Association or any applicable laws of the Cayman Islands to be held; and
- the revocation or variation of the authority given under this resolution by an ordinary resolution of the shareholders of the Company in general meeting.
"Rights Issue" means an offer of Shares or an offer of warrants, options or other securities giving right to subscribe for Shares, open for a period fixed by the directors of the Company to holders of Shares on the register of members of the Company on a fixed record date in proportion to their then holdings of such Shares (subject to such exclusion or other arrangements as the directors of the Company may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognized regulatory body or any stock exchange in any territory outside Hong Kong applicable to the Company)."
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NOTICE OF ANNUAL GENERAL MEETING
5. as special businesses, to consider, and if thought fit, pass the following ordinary resolutions: "THAT
- subject to and conditional upon The Stock Exchange of Hong Kong Limited granting approval of the listing of, and permission to deal in, the shares in the capital of the Company (the "Shares") falling to be issued by the Company pursuant to the exercise of any options under the proposed share option scheme of the Company (the "New Share Option Scheme"), the rules of which are set out in the document marked "A" produced to the meeting and signed by the Chairman for the purpose of identification, the New Share Option Scheme be and is hereby approved and adopted as the Company's share option scheme and the directors of the Company be and are hereby authorised to do all such acts and to enter into all such transactions, arrangements and agreements as may be necessary, desirable or expedient to give full effect to the New Share Option Scheme, including but without limitation to: (i) administer the New Share Option Scheme under which options will be granted to participants eligible under the New Share Option Scheme to subscribe for Shares; and (ii) issue and allot from time to time such number of Shares in the capital of the Company as may be required to be issued pursuant to the exercise of the options granted under the New Share Option Scheme provided that the total number of Shares which may be issued upon exercise of all options to be granted under the New Share Option Scheme and any other share option schemes of the Company shall not exceed 10% of the total number of Shares of the Company in issue as at the date of passing this resolution; and
- the existing share option scheme adopted by the Company on 11 February 2010 (the "Existing Share Option Scheme") be terminated upon the New Share Option Scheme becoming unconditional such that thereafter no further options shall be offered under the Existing Share Option Scheme but in all other respects the provisions of the Existing Share Option Scheme shall remain in full force and effect and options granted thereunder prior to such termination shall continue to be valid and exercisable in accordance with their terms of issue."
The register of members of the Company will be closed from 6 December 2019 to 12 December 2019, both days inclusive, during which period no transfer of Shares will be effected. In order to qualify for attending and voting at the forthcoming annual general meeting, all transfers accompanied by the relevant share certificates and transfer forms must be lodged with the Company's Hong Kong branch share registrar, Hong Kong Registrars Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong for registration not later than 4:30 p.m. on 5 December 2019.
Yours faithfully,
For and on behalf of
Kingwell Group Limited
Mu Dongsheng
Chairman
Hong Kong, 31 October 2019
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NOTICE OF ANNUAL GENERAL MEETING
Notes:
- A shareholder of the Company entitled to attend and vote at the meeting convened by the above notice is entitled to appoint proxies to attend and vote in his stead. A shareholder of the Company entitled to attend and vote at the above meeting may appoint one or more than one proxy to attend and to vote in his stead. A proxy need not be a shareholder of the Company. In order to be valid, the form of proxy must be completed and deposited at the Company's Hong Kong branch share registrar and transfer office, Hong Kong Registrars Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong together with a power of attorney or other authority, if any, under which it is signed or a certified copy of such power or authority, not less than 48 hours before the time for holding the meeting or any adjournment thereof. The completion and return of the form of proxy will not preclude any shareholder from attending and voting at the meeting or any adjournment thereof if so wished.
- Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the annual general meeting or any adjournment thereof.
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Kingwell Group Ltd. published this content on 30 October 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 October 2019 09:16:02 UTC
