AV Concept Holdings Limited — Proxy Solicitation & Information Statement 2015

Jan 23, 2015

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in AV Concept Holdings Limited (“ Company ”), you should at once hand this circular and the accompanying form of proxy to the purchaser, the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 595)

(1) REFRESHMENT OF THE 10% GENERAL LIMIT UNDER THE SHARE OPTION SCHEME; AND (2) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL AND NOTICE OF EXTRAORDINARY GENERAL MEETING

A notice convening the extraordinary general meeting of the Company to be held at 10:30 a.m. on Wednesday, 11 February 2015 at 6th Floor, Enterprise Square Three, 39 Wang Chiu Road, Kowloon Bay, Hong Kong is set out on pages EGM-1 to EGM-3 of this circular. Whether or not you are able to attend the meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time of the meeting to the office of the Company’s branch registrar in Hong Kong, Tricor Tengis Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong. Completion and return of the form of proxy will not preclude you from attending and voting at the meeting in person should you so wish, and in such case, the form of proxy previously submitted shall be deemed to be revoked.

26 January 2015

CONTENTS

	Page
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Notice of EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

– i –

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:

• “10% General Limit”

the limit imposed under the rules of the Share Option Scheme on the total number of Shares which may be issued upon the exercise of all options to be granted under the Share Option Scheme, being 10% of the Company’s issued share capital as at the date of adoption of the Share Option Scheme and thereafter, if refreshed, shall not exceed 10% of the Shares in issue as at the date of approval of the Proposed Refreshment by the Shareholders

“EGM”

the extraordinary general meeting of the Company to be held at 10:30 a.m. on Wednesday, 11 February 2015 at 6th Floor, Enterprise Square Three, 39 Wang Chiu Road, Kowloon Bay, Hong Kong, the notice of which is set out on pages EGM-1 to EGM-3 of this circular

“Board”

the board of Directors

“Company”

AV Concept Holdings Limited, a company incorporated in the Cayman Islands with limited liability and the issued shares of which are listed on the Main Board of the Stock Exchange

“Director(s)”

the director(s) of the Company

“Group”

the Company and its subsidiaries

“Hong Kong”

the Hong Kong Special Administrative Region of the People’s Republic of China

“HK$”

Hong Kong dollars, the lawful currency of Hong Kong

• “Increase in Authorised Share Capital”

the proposed increase in the authorised share capital of the Company from HK$80,000,000 (divided into 800,000,000 Shares) to HK$200,000,000 (divided into 2,000,000,000 Shares) by the creation of an additional 1,200,000,000 Shares

“Latest Practicable Date”

• 22 January 2015, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained herein

“Listing Rules”

the Rules Governing the Listing of Securities on the Stock Exchange

– 1 –

DEFINITIONS

“Proposed Refreshment”	the proposed refreshment of the 10% General Limit under the
	Share Option Scheme at the EGM
“Share(s)”	the ordinary share(s) of HK$0.10 each in the share capital of the
	Company
“Share Option Scheme”	the share option scheme of the Company adopted by the Company
	pursuant to an ordinary resolution of the Shareholders passed on 3
	August 2012
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“%”	per cent.

– 2 –

LETTER FROM THE BOARD

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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 595)

Executive Directors:

Dr. So Yuk Kwan (Chairman) Mr. So Chi On (Chief Executive Officer)

Mr. Ho Choi Yan, Christopher (Chief Financial Officer and Company Secretary)

Registered office: P.O. Box 309 Ugland House Grand Cayman, KY1-1104 Cayman Islands

Independent non-executive Directors:

Dr. Lui Ming Wah, SBS, JP Mr. Charles E. Chapman Mr. Wong Ka Kit

Head office and principal place of business in Hong Kong: 6th Floor Enterprise Square Three 39 Wang Chiu Road Kowloon Bay Hong Kong 26 January 2015

To the Shareholders

Dear Sir or Madam,

(1) REFRESHMENT OF THE 10% GENERAL LIMIT UNDER THE SHARE OPTION SCHEME; AND (2) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

INTRODUCTION

The purpose of this circular is to give you notice of the EGM and to provide you with information regarding (i) the Proposed Refreshment; and (ii) the Increase in Authorised Share Capital.

REFRESHMENT OF THE 10% GENERAL LIMIT UNDER THE SHARE OPTION SCHEME

Under the rules of the Share Option Scheme:

• (1) the maximum number of Shares which may be issued upon the exercise of all options to be granted under the Share Option Scheme and any other share option schemes of the Group is subject to the 10% General Limit; and

• (2) the maximum number of Shares which may be issued upon the exercise of all outstanding options granted and yet to be exercised under the Share Option Scheme and any other share option schemes of the Group must not in aggregate exceed 30% of the Shares in issue from time to time (“ 30% Overall Limit ”).

– 3 –

LETTER FROM THE BOARD

The Company may seek approval from the Shareholders in general meeting for refreshing the 10% General Limit so that the maximum number of Shares which may be issued upon the exercise of all options to be granted under the Share Option Scheme and any other share option schemes of the Group shall be re-set at 10% of the Shares in issue as at the date of approval of the limit as “refreshed”. In this connection, options previously granted under the Share Option Scheme and any other share option schemes of the Group (including options outstanding, cancelled, lapsed or exercised) will not be counted for the purpose of calculating the 10% General Limit as “refreshed”.

The existing 10% General Limit is 60,419,241 Shares, being 10% of the Shares in issue as at 3 August 2012 being the date of the adoption of the Share Option Scheme and the existing 10% General Limit was approved by the Shareholders. Share options entitling the holders thereof to subscribe for up to 43,110,000 Shares have been granted under the existing 10% General Limit. Of all such share options, share options entitling the holders thereof to subscribe for 7,710,000 Shares have remained outstanding as at the Latest Practicable Date. As to such outstanding options: (1) outstanding options to subscribe for an aggregate of 600,000 Shares were granted to Dr. So Yuk Kwan, executive Director and chairman of the Company, on 13 March 2013 at an exercise price of HK$0.435 per Share and exercisable by such grantee for a period of 5 years from the aforesaid date of grant; and (2) outstanding options to subscribe for an aggregate of 7,110,000 Shares were granted to ten eligible persons, being employees of the Group, on 12 December 2014 at an exercise price of HK$0.519 per Share and exercisable by such grantees for a period of 2 years from the aforesaid date of grant.

As disclosed above, the existing 10% General Limit has been utilised to a substantial extent and if the 10% General Limit is not refreshed, the Board can only grant further share options entitling the holders thereof to subscribe for 17,309,241 Shares, representing approximately 2.24% of the issued share capital of the Company as at the Latest Practicable Date, under the existing 10% General Limit.

The Directors consider that it is in the interests of the Company and the Shareholders as a whole to refresh the 10% General Limit so as to provide the Company with greater flexibility in granting share options to eligible participants under the Share Option Scheme, who, in the sole discretion of the Board, have made or may make contribution to the Group as well as to provide incentives to those persons and help the Group in retaining its existing employees and recruiting additional employees and to provide them with a direct interest in attaining the long term business objectives of the Group. For these reasons, the Directors will propose the passing of an ordinary resolution at the EGM for “refreshing” the 10% General Limit.

On the basis of 772,944,419 Shares being in issue as at the Latest Practicable Date and assuming that the issued share capital of the Company will not change prior to the EGM, the maximum number of Shares which may be issued upon exercise of all share options that may be granted under the 10% General Limit so refreshed is 77,294,441.

– 4 –

LETTER FROM THE BOARD

The refreshment of the 10% General Limit is conditional upon:

• (1) the passing of an ordinary resolution by the Shareholders at the EGM to approve the Proposed Refreshment; and

• (2) the Stock Exchange granting the listing of, and permission to deal in, such number of Shares, representing 10% of the issued Shares as at the date of the EGM, which may fall to be allotted and issued pursuant to the exercise of the options to be granted under the Share Option Scheme within the 10% General Limit so refreshed.

As at the Latest Practicable Date, the Directors had no intention to grant further share options under the existing 10% General Limit and no present intention to grant any share options under the refreshed 10% General Limit upon the Proposed Refreshment comes into effect.

Application will be made to the Stock Exchange for the listing of, and permission to deal in, such number of Shares, representing 10% of the issued Shares as at the date of the EGM, which may fall to be issued pursuant to the exercise of the options to be granted under the Share Option Scheme within the 10% General Limit so refreshed.

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

The Company has an authorised share capital of HK$80,000,000 divided into 800,000,000 Shares of which 772,944,419 Shares were in issue as at the Latest Practicable Date. The Board proposes to increase the authorised share capital of the Company from HK$80,000,000 divided into 800,000,000 Shares to HK$200,000,000 divided into 2,000,000,000 Shares by the creation of an additional 1,200,000,000 new Shares. The new Shares shall rank pari passu with the existing Shares upon issue.

In order to provide for future expansion in the share capital of the Company, as and when necessary, the Board proposed the Increase in Authorised Share Capital. The Directors have no present intention to issue any part of the increased authorised share capital of the Company.

The Board believes that the Increase in Authorised Share Capital provides the Company with greater flexibility to accommodate future issue of new Shares and is in the interest of the Company and the Shareholders as a whole.

Condition of the Increase in Authorised Share Capital

The Increase in Authorised Share Capital is conditional upon the passing of an ordinary resolution by the Shareholders at the EGM.

– 5 –

LETTER FROM THE BOARD

EGM

The notice of EGM is set out on pages EGM-1 to EGM-3 of this Circular. At the EGM, resolutions will be proposed to approve the Proposed Refreshment and the Increase in Authorised Share Capital.

A form of proxy for use at the EGM is enclosed with this circular. Whether or not you are able to attend the EGM, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon and return it to the office of the Company’s branch registrar and transfer office in Hong Kong, Tricor Tengis Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish, and in such case, the form of proxy previously submitted shall be deemed to be revoked.

No shareholder is required to abstain from voting on the resolutions to be proposed at the EGM under the Listing Rules. All the resolutions put to vote at the EGM will be decided by way of poll as required by the Listing Rules (except where the chairman of the meeting, 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).

RECOMMENDATION

The Board is of the opinion that the Proposed Refreshment and the Increase in Authorised Share Capital are in the best interests of the Company and the Shareholders as a whole and recommend the Shareholders to vote in favour of all the resolutions proposed at the EGM.

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, have 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.

By order of the Board AV Concept Holdings Limited So Yuk Kwan

Chairman

– 6 –

NOTICE OF EGM

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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 595)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the extraordinary general meeting (“ EGM ”) of AV Concept Holdings Limited (“ Company ”) will be held at 10:30 a.m. on Wednesday, 11 February 2015 at 6th Floor, Enterprise Square Three, 39 Wang Chiu Road, Kowloon Bay, Hong Kong to consider and, if thought fit, pass each of the following resolutions as an ordinary resolution:

ORDINARY RESOLUTIONS

1. “ THAT subject to and conditional upon The Stock Exchange of Hong Kong Limited (“ Stock Exchange ”) granting the listing of, and permission to deal in, such number of shares of the Company which may fall to be allotted and issued pursuant to the exercise of the options which may be granted under the share option scheme adopted by the Company pursuant to an ordinary resolution of the Shareholders passed on 3 August 2012 (“ Share Option Scheme ”), representing 10 per cent. of the issued share capital of the Company as at the date on which this resolution is passed, pursuant to the rules of the Share Option Scheme:

2. (a) approval be and is hereby granted for refreshing the 10 per cent. mandate under the Share Option Scheme (“ Refreshed Scheme Mandate ”) provided that the total number of shares of the Company which may be allotted and issued upon the exercise of all options to be granted under the Share Option Scheme and any other share option schemes of the Company and its subsidiaries (“ Group ”) under the limit as refreshed hereby shall not exceed 10 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date on which this resolution is passed (options previously granted under the Share Option Scheme and any other share option schemes of the Group (including options outstanding, cancelled, lapsed or exercised in accordance with the terms of the Share Option Scheme or any other share option schemes of the Group) shall not be counted for the purpose of calculating the Refreshed Scheme Mandate); and

3. (b) the directors of the Company or a duly authorised committee thereof be and is/are hereby authorised: (i) at its/their absolute discretion, to grant options to subscribe for shares of the Company within the Refreshed Scheme Mandate in accordance with the rules of the Share Option Scheme, and (ii) to allot, issue and deal with shares of the Company pursuant to the exercise of options granted under the Share Option Scheme within the Refreshed Scheme Mandate.”

EGM – 1

NOTICE OF EGM

1. “ THAT :

2. (a) the authorised share capital of the Company be and is hereby increased from HK$80,000,000 divided into 800,000,000 ordinary shares of HK$0.10 each (“ Shares ”) to HK$200,000,000 divided into 2,000,000,000 Shares by the creation of an additional 1,200,000,000 Shares (“ Increase in Authorised Share Capital ”); and

3. (b) the directors of the Company be and are hereby authorised to do all such acts and things and execute all such documents which they consider necessary, desirable or expedient for the purpose of, or in connection with, the implementation of and giving effect to the Increase in Authorised Share Capital.”

By order of the Board AV Concept Holdings Limited So Yuk Kwan Chairman

Hong Kong, 26 January 2015

Head office and principal place of business in Hong Kong: 6th Floor Enterprise Square Three 39 Wang Chiu Road Kowloon Bay Hong Kong

EGM – 2

NOTICE OF EGM

Notes:

1. Any member entitled to attend and vote at the meeting convened by the above notice is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a member of the Company. If more than one proxy is appointed, the appointment shall specify the number of Shares in respect of which each such proxy is appointed.

2. In order to be valid, the form of proxy must be duly completed and signed in accordance with the instructions printed thereon and deposited together with a power of attorney or other authority, if any, under which it is signed or a notarially certified copy of such power or authority, at the office of the Company’s Hong Kong branch share registrar and transfer office, Tricor Tengis Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time for holding the meeting or adjourned meeting.

3. Completion and return of the form of proxy will not preclude a member of the Company from attending and voting in person at the EGM convened or any adjourned meeting and in such event, the form of proxy will be deemed to be revoked.

4. Where there are joint registered holders of any share of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the meeting personally or by proxy, that one of the said persons so present whose name stands first on the register in respect of such shares shall alone be entitled to vote in respect of the relevant joint holding and, for this purpose, seniority shall be determined by reference to the order in which the names of the joint holders stand on the register in respect of the relevant joint holding. Several executors or administrators of a deceased member in whose name any share stands shall be deemed joint holders thereof.

As at the date of this notice, the board of directors of the Company comprises three executive directors, Dr. So Yuk Kwan (Chairman), Mr. So Chi On and Mr. Ho Choi Yan Christopher and three independent non-executive directors, Dr. Lui Ming Wah, SBS, JP, Mr. Charles E. Chapman and Mr. Wong Ka Kit.

EGM – 3