China Display Optoelectronics Technology Holdings Limited - Proxy Solicitation & Information Statement 2020

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Sunwah Kingsway Capital Holdings Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or the transferee or to the bank manager, licensed securities dealer or 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, 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.

==> picture [92 x 42] intentionally omitted <==

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

(1) PROPOSED SHARE CONSOLIDATION;

(2) PROPOSED CHANGE IN BOARD LOT SIZE;

(3) PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME; AND

NOTICE OF SPECIAL GENERAL MEETING

Capitalised terms used in this circular shall have the same meanings as defined in the section headed “Definitions” in this circular.

Notice of the SGM of Sunwah Kingsway Company Holdings Limited to be held at 7/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong at 10:30 a.m. on Tuesday, 24th November 2020, is set out on pages 29 to 32 of this circular.

A form of proxy for the SGM is also enclosed with this circular. Whether or not you are able to attend the SGM, you are requested to complete the form of proxy in accordance with the instructions stated thereon and return it to the Company’s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, as soon as possible but in any event not later than 48 hours before the time appointed for the holding of the SGM (i.e. no later than 10:30 a.m. on Sunday, 22nd November 2020 (Hong Kong time)) or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the SGM and at any adjournment thereof if you so wish. In such event, the form of proxy shall be deemed to be revoked.

PRECAUTIONARY MEASURES FOR THE SPECIAL GENERAL MEETING

Practical measures will be taken to try to avoid the spread of COVID-19 at the SGM, including:

compulsory temperature checks and health declarations for all attendees
compulsory wearing of surgical face masks throughout the SGM
maintaining proper distance between seats
no refreshments will be served at the SGM

Any person who does not comply with the precautionary measures will not be admitted to the venue of the SGM. The Company reminds the Shareholders, particularly those who are unwell or subject to quarantine in relation to COVID-19, that they may appoint any person or the chairman of the SGM as a proxy to vote on the resolutions to be proposed at the SGM, instead of attending the SGM in person.

20 October 2020

	Pages
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Expected Timetable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Appendix I – Principal Terms of the New Share Option Scheme . . . . . . . . . . .	17
Appendix II – Notice of SGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29

– i –

DEFINITIONS

In this circular, unless the context otherwise requires, capitalized terms used shall have the following meanings:

“2010 Share Option Scheme”

the share option scheme of the Company adopted on 10 November 2010;

“Adoption Date”

the date on which the New Share Option Scheme is to be adopted, conditionally or unconditionally, by the resolution of the Shareholders at the SGM;

“associate” has the meaning ascribed to it under the Listing Rules;
“Auditors” the auditors for the time being of the Company;
“Board” the board of Directors of the Company;
“Business Day” has the meaning ascribed to it under the Listing Rules;
“Bye-laws” bye-laws of the Company;
“CCASS”
Central Clearing and Settlement System established and operated by the HKSCC;

“Change in Board Lot Size” the proposed change in board lot size of the Shares for trading on the Stock Exchange from 10,000 Existing Shares to 5,000 Consolidated Shares;

“close associate”
has the meaning ascribed to it under the Listing Rules;
“Company”

Sunwah Kingsway Capital Holdings Limited, a company incorporated in Bermuda with limited liability, the shares of which are listed on the Main Board of the Stock Exchange;

“Companies Act” the Companies Act 1981 of Bermuda;
“Consolidated Share(s)”

ordinary share(s) of HK$0.10 each in the share capital of the Company immediately after the Share Consolidation becoming effective;

“core connected persons” has the meaning ascribed to it under the Listing Rules;
“Director(s)” the director(s) of the Company;

“Exercise Price” the price per Share at which a Grantee may subscribe for Shares on the exercise of an Option;

– 1 –

DEFINITIONS

“Existing Share(s)” ordinary share(s) of HK$0.01 each in the share capital of the Company prior to the Share Consolidation becoming effective; “Existing Share Certificate(s)” share certificate(s) for the Existing Shares;

“Grantee” any Participant who accepts an Offer in accordance with the terms of the New Share Option Scheme or (where the context so permits) a person who is entitled to any such Option in consequence of the death of the original Grantee or the legal personal representative of such person;
“Group” the Company and its subsidiaries from time to time and “ member(s) of the Group ” shall be construed accordingly;
“HKSCC” Hong Kong Securities Clearing Company Limited;
“HK$” Hong Kong dollars, the lawful currency of Hong Kong;
“Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China;
“Latest Practicable Date” 14 October 2020, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular;
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange;
“New Share Certificate(s)” share certificate(s) for the Consolidated Shares;
“New Share Option Scheme” the new share option scheme proposed to be adopted by the Company at the SGM, a summary of the principal terms of which is set out in Appendix I of this circular;
“Offer” the offer of the grant of an Option made in accordance with the New Share Option Scheme;
“Option”

an option to subscribe for Shares granted pursuant to the New Share Option Scheme and for the time being subsisting;

– 2 –

DEFINITIONS

“Option Period” in respect of any particular Option, the period during which the Grantee may exercise the Option, which is determined and notified by the Board to the Grantee at the time of making an Offer which shall not expire later than 10 years from the date of grant;
“Participants” the directors (including executive directors, non-executive directors and independent non-executive directors) and employees of any member of the Group and any advisers, consultants, distributors, contractors, contract manufacturers, suppliers, agents, customers, business partners, joint venture business partners, service providers of any member of the Group as determined by the Board, in its sole discretion, from time to time to have contributed or will contribute to the Group;
“SGM” the special general meeting of the Company to be held at 7/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong on Tuesday, 24 November 2020 at 10:30 a.m, notice of which is set out in this circular;
“Shareholder(s)” holder(s) of the Shares;
“Share(s)” Existing Share(s) or Consolidated Share(s), as the case may be;
“Share Consolidation” the proposed consolidation of every ten (10) issued and unissued Existing Shares into one (1) Consolidated Share;
“Stock Exchange” The Stock Exchange of Hong Kong Limited; and
“%” per cent.

– 3 –

EXPECTED TIMETABLE

The expected timetable for the implementation of the Share Consolidation and the Change in Board Lot Size is as follows:

Event

Time and date 2020 (unless specified otherwise)

Despatch of the Company’s circular with notice of	Despatch of the Company’s circular with notice of
SGM and form of proxy . . . . .	. . . . . . . . . . . . . . . . .	. . . . . . . . . . . Tuesday, 20 October
Latest time for lodging transfer documents of
the Existing Shares in order to qualify for
attending and voting at the SGM	. . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . 4:30 p.m. on
		Wednesday, 18 November
Closure of register of members for	the entitlement
to attend and vote at the SGM	. . . . . . . . . . . . . . . . .	. . From Thursday, 19 November to
		Tuesday, 24 November
		(both days inclusive)
Latest time and date for lodging forms of proxy for
the SGM (not less than 48 hours	prior
to the time of SGM) . . . . . . . .	. . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . 10:30 a.m. on
		Sunday, 22 November
Date and time of the SGM . . . . .	. . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . 10:30 a.m. on
		Tuesday, 24 November
Publication of announcement of poll results of the SGM		. . . . . . . . Tuesday, 24 November

The following events are conditional on the fulfillment of the conditions of the Share Consolidation and the Change in Board Lot Size:

Expected effective date of the Share Consolidation	. . . . . . . . . . . . Thursday, 26 November
First day for free exchange of
Existing Share Certificates for
New Share Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thursday, 26 November
Dealings in the Consolidated Shares commence . . . . . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 26 November
Original counter for trading in the Existing Shares
in board lots of 10,000 Existing Shares
(in the form of Existing Share Certificates)
temporarily closes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 26 November

– 4 –

EXPECTED TIMETABLE

Temporary counter for trading in the Consolidated
Shares in board lots of 1,000 Consolidated Shares
(in the form of Existing Share Certificates) opens	. . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 26 November
Original counter for trading in the Consolidated
Shares in board lots of 5,000 Consolidated Shares
(in the form of New Share Certificates) re-opens	. . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 10 December
Parallel trading in the Consolidated Shares
(in the form of New Share Certificates and
Existing Share Certificates) commences . . . . . . . . . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 10 December
Designated broker starts to stand in the market
to provide matching services for odd lots of
the Consolidated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9:00 a.m. on
	Thursday, 10 December
Temporary counter for trading in the Consolidated Shares
in board lots of 1,000 Consolidated Shares
(in the form of Existing Share Certificates) closes	. . . . . . . . . . . . . . . . . . 12:10 p.m. on
	Thursday, 31 December
Parallel trading in the Consolidated Shares
(in the form of New Share Certificates and
Existing Share Certificates) ends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12:10 p.m. on
	Thursday, 31 December
Designated broker ceases to stand in the market
to provide matching services for odd lots of
the Consolidated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12:10 p.m. on
	Thursday, 31 December
Last day for free exchange of Existing Share
Certificates for New Share Certificates for
the Consolidated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 5 January 2021

All times and dates in this timetable refer to Hong Kong local times and dates. The Shareholders should note that the dates and deadlines specified in this circular for events in the expected timetable for the Share Consolidation are subject to the satisfaction of all the conditions of the Share Consolidation, including but not limited to the approval of the Share Consolidation by the Shareholders at the SGM, and are therefore for indicative purposes only.

In the event that any special circumstances arise, the Board may extend, or make adjustments to, the expected timetable if it considers appropriate. Any extension or adjustment to the expected timetable will be published or notified to the Shareholders and the Stock Exchange as and when appropriate.

– 5 –

LETTER FROM THE BOARD

==> picture [92 x 41] intentionally omitted <==

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

Directors:

Dr. Jonathan Koon Shum Choi (Chairman) Mr. Michael Koon Ming Choi (Chief Executive Officer)

Non-executive Directors: Ms. Janice Wing Kum Kwan Dr. Lee G. Lam

Independent Non-executive Directors:

Mr. Robert Tsai To Sze Ms. Elizabeth Law Mr. Huanfei Guan

Registered office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Principal place of business in Hong Kong: 7/F, Tower One Lippo Centre 89 Queensway, Hong Kong

Company Secretary:

Mr. Vincent Wai Shun Lai

20 October 2020

To the Shareholders

Dear Sir/Madam,

(1) PROPOSED SHARE CONSOLIDATION; (2) PROPOSED CHANGE IN BOARD LOT SIZE; (3) PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME; AND

NOTICE OF SPECIAL GENERAL MEETING

1. INTRODUCTION

Reference is made to the announcement of the Company dated 18 September 2020 in relation to the Share Consolidation, the Change in Board Lot Size and the proposed adoption of the New Share Option Scheme (the “ Announcement ”).

The purpose of this circular is to provide you with further information regarding, among other things, (i) the Share Consolidation; (ii) the Change in Board Lot Size; (iii) the proposed adoption of the New Share Option Scheme and (iv) the notice of the SGM.

– 6 –

LETTER FROM THE BOARD

2. PROPOSED SHARE CONSOLIDATION

The Board proposes to implement the Share Consolidation on the basis that every ten (10) issued and unissued Existing Shares be consolidated into one (1) Consolidated Share.

Conditions of the Share Consolidation

The Share Consolidation is conditional upon the following conditions:

(i) the passing of an ordinary resolution by the Shareholders to approve the Share Consolidation at the SGM;
(ii) the compliance with all relevant procedures and requirements under the laws of Bermuda (where applicable) and the Listing Rules to effect the Share Consolidation; and
(iii) the Listing Committee of the Stock Exchange granting the approval of the listing of, and permission to deal in, the Consolidated Shares.

Subject to the satisfaction of all of the above conditions, it is expected that the Share Consolidation will become effective on Thursday, 26 November 2020, being the second Business Day immediately after the date of the SGM.

Effects of the Share Consolidation

As at the Latest Practicable Date, the authorized share capital of the Company was HK$1,000,000,000.00 divided into 100,000,000,000 Existing Shares with a par value of HK$0.01 each, and 7,127,614,962 Existing Shares had been allotted and issued.

Upon the Share Consolidation becoming effective:

(i) on the assumption that there shall be no change in the authorized share capital of the Company from the Latest Practicable Date until the effective date of the Share Consolidation, the authorized share capital of the Company will become HK$1,000,000,000.00 divided into 10,000,000,000 Consolidated Shares with a par value of HK$0.10 each;
(ii) on the assumption that no further Existing Shares shall be allotted, issued or repurchased from the Latest Practicable Date until the effective date of the Share Consolidation, 712,761,496 Consolidated Shares will be in issue, which are fully paid or credited as fully paid; and
(iii) the Consolidated Shares shall rank pari passu in all respects with each other in accordance with the memorandum of association of the Company and the Bye-laws.

– 7 –

LETTER FROM THE BOARD

Other than the expenses to be incurred in relation to the Share Consolidation, the implementation thereof will not alter the underlying assets, business operations, management or financial position of the Company or the proportionate interests or rights of the Shareholders, save for any fractional Consolidated Shares to which the Shareholders would otherwise be entitled.

Listing application

An application has been made by the Company to the Listing Committee of the Stock Exchange for the listing of, and the permission to deal in, the Consolidated Shares upon the Share Consolidation becoming effective. Subject to the granting of approval by the Listing Committee of the Stock Exchange of the listing of, and permission to deal in, the Consolidated Shares on the Stock Exchange upon the Share Consolidation becoming effective, as well as compliance with the stock admission requirements of the HKSCC, the Consolidated Shares will be accepted as eligible securities by the HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Consolidated Shares on the Stock Exchange or such other date as determined by the HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time. All necessary arrangements will be made for the Consolidated Shares to be admitted into CCASS established and operated by the HKSCC.

None of the Existing Shares or debt securities of the Company are listed or dealt in on any other stock exchange, and at the time when the Share Consolidation becomes effective, the Consolidated Shares in issue will not be listed or dealt in on any other stock exchange other than the Stock Exchange. No such aforesaid listing or permission to deal is being or is proposed to be sought.

Fractional entitlement to the Consolidated Shares

Fractional Consolidated Shares, if any, arising from the Share Consolidation, will be disregarded and will not be issued to the Shareholders. In lieu of issuing fractional Consolidated Shares to the Shareholders so entitled, all such fractional Consolidated Shares will be aggregated and, if possible, sold for the benefit of the Company. Fractional Consolidated Shares would only arise in respect of the entire shareholding of a holder of the Existing Shares regardless of the number of share certificates held by such holder.

Arrangement in relation to the trading of odd lots

In order to alleviate the difficulties in the trading of the Consolidated Shares due to the odd lots brought about by the Share Consolidation, the Company has appointed Kingsway Financial Services Group Limited as its agent to provide the Shareholders with a matching service, whereby such Shareholders may acquire odd lots of the

– 8 –

LETTER FROM THE BOARD

Consolidated Shares to make up a full board lot, or dispose of their holding of odd lots of the Consolidated Shares. Shareholders who wish to take advantage of the aforesaid service may directly or through their brokers, contact Mr. Wesley So of Kingsway Financial Services Group Limited at 7/F., Tower 1, Lippo Centre, 89 Queensway, Hong Kong (telephone: (852) 2283 7698, during office hours from 9:00 a.m. Thursday, 10 December 2020 to 12:10 p.m. Thursday, 31 December 2020.

Holders of odd lots of the Consolidated Shares should note that the agent as referred to above will only provide the aforesaid matching service on a best efforts basis. As a result, the matching of the sale and purchase of odd lots of the Consolidated Shares is not guaranteed. Should any Shareholders be in any doubt about the above arrangement in relation to the trading of odd lots, it is recommended that they consult their own professional advisers.

Exchange of share certificates

Subject to the Share Consolidation becoming effective, the date of which is currently expected to be Thursday, 26 November 2020, being the second Business Day immediately after the date of the SGM, the Shareholders may, during the period from Thursday, 26 November 2020 to Tuesday, 5 January 2021 (both days inclusive), submit Existing Share Certificates in the color of blue to the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, to exchange for New Share Certificates in the color of purple at the expense of the Company, subject to its business hours.

Thereafter, the Existing Share Certificates will be accepted for exchange only upon payment of a fee of HK$2.50 (or such other amount as may from time to time be specified by the Stock Exchange) by the Shareholders for each Existing Share Certificate submitted for cancellation or each New Share Certificate issued, whichever the number of share certificates cancelled/ issued is higher.

Subject to and upon the Share Consolidation becoming effective, after 4:10 p.m. on Tuesday, 5 January 2021, Existing Share Certificates will remain effective as documents of title and may be exchanged for New Share Certificates at any time but will not be accepted for delivery, trading and settlement purposes.

Adjustments in relation to other securities of the Company

As at the Latest Practicable Date, the Company had no other outstanding options, warrants or other securities in issue which are convertible into or giving rights to subscribe for, convert or exchange into, any Shares.

– 9 –

LETTER FROM THE BOARD

3. PROPOSED CHANGE IN BOARD LOT SIZE

As at the Latest Practicable Date, the Existing Shares were traded on the Stock Exchange in the board lot size of 10,000 Existing Shares. The Board proposed to change the board lot size for trading on the Stock Exchange from 10,000 Existing Shares to 5,000 Consolidated Shares conditional upon the Share Consolidation becoming effective.

Based on the closing price of HK$0.041 per Existing Share (equivalent to the theoretical closing price of HK$0.41 per Consolidated Share) as at the Latest Practicable Date, (i) the value of each existing board lot of Existing Shares is HK$410; (ii) the value of each board lot of 10,000 Consolidated Shares would be HK$4,100 on the assumption that the Share Consolidation becomes effective; and (iii) the estimated value per board lot of 5,000 Consolidated Shares would be HK$2,050 on the assumption that the Change in Board Lot Size had also become effective.

The Change in Board Lot Size will not result in change in the relative rights of the Shareholders.

Reasons for the Share Consolidation and the Change in Board Lot Size

Pursuant to Rule 13.64 of the Listing Rules, where the market price of the securities of an issuer approaches the extremities of HK$0.01 or HK$9,995.00, the issuer may be required either to change the trading method or to proceed with a consolidation or splitting of its securities. Reference is also made to the “Guide on Trading Arrangements for Selected Types of Corporate Actions” issued by the Hong Kong Exchanges and Clearing Limited on 28 November 2008 and updated on 30 August 2019 (the “ Guide ”), which provides that the expected value per board lot should be greater than HK$2,000 taking into account the minimum transaction costs for a securities trade.

The Board resolved to propose the Share Consolidation and the Change in Board Lot Size having taken into account the facts that: (i) the closing prices of the Existing Shares throughout the period commencing from 18 September 2019, being the twelve-month period prior to the date of the Announcement, up to and including the Latest Practicable Date (the “ Relevant Period ”) were below HK$0.10; (ii) the average closing price of the Existing Shares during the Relevant Period was HK$0.0493 per Existing Share (the “ Average Closing Price ”); and (iii) based on the Average Closing Price and the current board lot size of 10,000, the value per board lot during the Relevant Period was far lower than HK$2,000.

It is expected that upon the Share Consolidation becoming effective, the market price will, theoretically, increase by ten (10) times and the nominal value of the Shares likewise will increase to HK$0.1 each. Based on the closing price as quoted on the Stock Exchange on the Latest Practicable Date of HK$0.041 per Existing Share and thus theoretically HK$0.41 per Consolidated Share, the value per board lot of 5,000 Consolidated Shares would be HK$2,050, which would be in compliance with the requirements regarding trading arrangements as specified under the Guide.

– 10 –

LETTER FROM THE BOARD

The Share Consolidation is expected to bring about a corresponding upward adjustment in the trading price per Consolidated Share on the Stock Exchange. In view of the closing price of HK$0.041 per Existing Share as at the Latest Practicable Date, the proposed consolidation ratio of the Share Consolidation (i.e. every ten (10) issued and unissued Existing Shares consolidated into one (1) Consolidated Share) was determined by the Board primarily to allow for a reasonable margin above the extremity of HK$0.1 per share as set forth under the Guide, which the Company would otherwise be faced with, as well as to minimize the odd lot effect as a result of the Share Consolidation itself.

Subject to and upon the Share Consolidation becoming effective, assuming that there was no change to the board lot of 10,000 Consolidated Shares based on the theoretical price of HK$0.41 per Consolidated Share as mentioned above, the value per board lot would be HK$4,100. The Board considers that the Change in Board Lot Size will reduce the board lot value of the Consolidated Shares after the Share Consolidation becomes effective, and may result in higher liquidity of the Consolidated Shares and broaden the Company’s shareholder base. The Board is also of the view that the Change in Board Lot Size will help reduce the number of odd lot shares created per new board lot compared to the other board lot size options.

In view of the above reasons, the Board considers that the Share Consolidation and the Change in Board Lot Size are justifiable notwithstanding the potential costs and the impact arising from the creation of odd lots to the Shareholders. Accordingly, the Board is of the view that the Share Consolidation is beneficial to and in the interests of the Company and the Shareholders as a whole.

As at the Latest Practicable Date, the Company has no intention to carry out other corporate actions in the next 12 months which may have an effect of undermining or negating the intended purpose of the Share Consolidation, and the Company does not have any concrete plan to conduct any fundraising activities in the next 12 months.

4. PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME

The 2010 Share Option Scheme

As the 2010 Share Option Scheme expired on 9 November 2020, the Board considers that it is in the interests of the Company to adopt the New Share Option Scheme so as to continue to be able to provide incentives or rewards to the Participants thereunder for their contributions to the success of the Group. There is no material difference between the terms of the 2010 Share Option Scheme and the New Share Option Scheme.

As at the Latest Practicable Date, the Company had granted 99,000,000 options under the 2010 Share Option Scheme and all have lapsed. As at the Latest Practicable Date, the Company had no outstanding share options under the 2010 Share Option Scheme. There was no other share option scheme put in place by the Company as at the Latest Practicable Date.

– 11 –

LETTER FROM THE BOARD

Details of 99,000,000 options granted under the 2010 Share Option Scheme are as follows:

		Number of
		Shares to be
		issued upon
		exercise of		Status of
The	Position held with	the options	Validity period of the	the options
grantee	the Company	in full	options	granted
1.	Director	30,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
2.	Director	30,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
3.	Former Director	10,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
4.	Former employee	10,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
5.	Employee	10,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
6.	Employee	3,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
7.	Employee	3,000,000	From 11 January 2011	Lapsed
			to 10 January 2014
8.	Former employee	3,000,000	From 11 January 2011	Lapsed
			to 10 January 2014

For details, please refer to the announcement made by the Company dated 11 January 2011, the circular made by the Company dated 14 February 2011 and the announcement of poll results of the Company dated 4 March 2011.

Proposed adoption of the New Share Option Scheme

In view of the expiry of the 2010 Share Option Scheme, the Board proposes to recommend to the Shareholders to consider and, if thought fit, approve the adoption of the New Share Option Scheme, which will constitute a share option scheme under Chapter 17 of the Listing Rules. The New Share Option Scheme, if so adopted, will be valid for 10 years from the Adoption Date, so that share options to subscribe for the Shares may be granted to the Participants pursuant to the terms thereof. The purpose of the New Share Option Scheme is to provide the Participants to subscribe for Shares of the Company with the opportunity to acquire proprietary interests in the Company with a view to encouraging the Participants to work towards enhancing the value of the Company and its Shares for the benefit of the Company and its Shareholders as a whole.

The Board may make an Offer to any Participant, as the Board may in its absolute discretion select, to take up an option. Such Offer shall specify the terms on which the Option is to be granted, and such terms may include any minimum period(s)

– 12 –

LETTER FROM THE BOARD

after the expiry of which, and/or any minimum performance target(s) that must be reached before the Option can be exercised in whole or in part, and may include at the discretion of the Board other terms, conditions, restrictions or limitations imposed either on a case by case basis or generally. Save as specified in the Offer by the Board, there is no pre-determined minimum period for which the Option must be held before it can be exercised nor is there any pre-determined performance target which must be achieved before the Options can be exercised under the New Share Option Scheme. The Board will also determine the Exercise Price in its absolute discretion. Any person whom the Board has resolved to be qualified to become a Participant must remain eligible during the period when any Option granted to him remains outstanding. In assessing such Grantee’s continuing eligibility under the New Share Option Scheme, the requirements set out in the definition of Participant and the views, if any, of the independent non-executive directors of the Company shall be given due and careful consideration by the Board. The Board considers that these provisions will give the Board flexibility to impose conditions suitable for fulfilling the purposes of the New Share Option Scheme on a case-by-case basis, and that the New Share Option Scheme will potentially provide the Participants with a personal stake in the Group, as a result of which (i) Participants will be motivated to optimize their performance efficiency for the benefit of the Group; and (ii) the Group will be able to attract, retain, or otherwise maintain an ongoing business relationship with the Participants other than directors and employees of any member of the Group, whose contributions are or will be beneficial to the long-term growth of the Group.

Scope of Participants

The Participants include the directors (including executive directors, non-executive directors and independent non-executive directors) and employees of any member of the Group and any advisers, consultants, distributors, contractors, contract manufacturers, suppliers, agents, customers, business partners, joint venture business partners, service providers of any member of the Group as determined by the Board, in its sole discretion, from time to time to have contributed or will contribute to the Group. In determining the basis of eligibility of each Participant, the Board would take into account such factors as the Board may at its discretion consider appropriate.

The Board considers it appropriate to include as Participants those persons who are not directors or employees of any member of the Group, but who may otherwise contribute to the business affairs, technical development and growth of the Group, as the long-term growth and development of the Group requires the co-operation and contributions from such parties who play a vital role as advisers, consultants (whether on an employment or contractual or honorary basis or otherwise and whether paid or unpaid) to any area of business or business development of any member of the Group, i.e. senior professionals who provide strategic advisory or consulting services for the Group’s new business, new customers and new model of business development, distributors, contractors, contract manufacturers, suppliers, agents, customers, business partners, joint venture business partners and service providers of any member of the Group. The Board considers that the Participants other than directors or employees of any member of the Group will share common interests and objectives with the Group upon their exercise of the Options. The grant of Options under the New Share Option

– 13 –

LETTER FROM THE BOARD

Scheme serves to offer incentives for the aforesaid parties to provide the Group with quality goods, improved services and/or more valuable advice, thereby cultivating sustainable relationships with the Group, which in turn contribute to the long-term development and growth of the Group.

As at the Latest Practicable Date, the Company had a total of 7,127,614,962 Existing Shares in issue. Assuming that there is no change in the total number of Existing Shares in issue during the period from the Latest Practicable Date up to the Adoption Date, the maximum number of Shares which may be allotted and issued pursuant to the New Share Option Scheme will be 712,761,496 Existing Shares, representing 10% of the total number of Existing Shares in issue as at the date of SGM. Based on the above, it is expected that upon the Share Consolidation becoming effective, the maximum number of Consolidated Shares which may be allotted and issued pursuant to the New Share Option Scheme will be 71,276,149 Consolidated Shares, representing 10% of the total number of Consolidated Shares in issue.

As at the Latest Practicable Date, no Option has been granted or agreed to be granted pursuant to the New Share Option Scheme and the Company does not have any plan to grant Options under the New Share Option Scheme. The Directors consider that it is not appropriate to state the value of all Options that can be granted pursuant to the New Share Option Scheme as if they had been granted at the Latest Practicable Date. The Directors believe that any statement regarding the value of the Options as at the Latest Practicable Date will not be meaningful to the Shareholders, taking into account the number of variables which are crucial for the calculation of the option value which have not been determined. Such variables include the exercise price, exercise period, any performance targets set and other relevant variables.

Listing application

An 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 on the Stock Exchange which may fall to be allotted and issued by the Company pursuant to the exercise of the Options to be granted under the New Share Option Scheme.

Conditions of the New Share Option Scheme

The New Share Option Scheme shall take effect subject to the following conditions:

(1) the passing of an ordinary resolution to approve and adopt the New Share Option Scheme by the Shareholders at the SGM and to authorise the Board to grant the Options thereunder and to allot and issue the Shares pursuant to the exercise of any Options under the New Share Option Scheme; and
(2) the Listing Committee of the Stock Exchange granting the approval of the listing of, and permission to deal in, the Shares which fall to be issued by the Company pursuant to the exercise of any Options under the New Share Option Scheme.

– 14 –

LETTER FROM THE BOARD

If the above condition (2) is not satisfied on or before the date following six (6) months after the Adoption Date (or such later date as the Board may decide), this Scheme shall forthwith terminate, and any Option granted or agreed to be granted pursuant to the New Share Option Scheme and any Offer shall be of no effect and no person shall be entitled to any rights or benefits or be under any obligations under or in respect of the New Share Option Scheme or any such Option.

Principal Terms of the New Share Option Scheme

A summary of the principal terms of the New Share Option Scheme is set out in the Appendix I to this circular. A copy of the New Share Option Scheme will be available for inspection at the Company’s principal place of business in Hong Kong at 7/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong for a period of 14 days before the date of the SGM and at the SGM.

None of the Directors is a trustee of the New Share Option Scheme or has a direct or indirect interest in the trustee of the New Share Option Scheme, if any. As at the Latest Practicable Date, to the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder is required under the Listing Rules to abstain from voting on the ordinary resolution to approve and adopt the New Share Option Scheme.

5. SGM

A notice of the SGM is set out on pages 29 to 32 of this circular. The SGM will be convened and held to consider, if thought fit, approve the Share Consolidation and the adoption of the New Share Option Scheme.

Pursuant to Rule 13.39(4) of the Listing Rules, any votes of the Shareholders at a general meeting must be taken by poll. Accordingly, the resolutions to be proposed at the SGM will be voted by way of poll by the Shareholders.

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, no Shareholders are required to abstain from voting on the resolutions to be proposed at the SGM.

A form of proxy for use at the SGM is enclosed. If you are unable to attend the SGM in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not later than 48 hours before time appointed for holding of the SGM. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or any adjournment thereof should you so wish.

– 15 –

LETTER FROM THE BOARD

6. RECOMMENDATION

The Directors (including the independent non-executive Directors) consider that the Share Consolidation, the Change in Board Lot Size and the adoption of the New Share Option Scheme are all in the interests of the Company and the Shareholders as a whole. The Board therefore recommends that the Shareholders vote in favour of the resolutions to be proposed at the SGM.

7. 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 the Board of Sunwah Kingsway Capital Holdings Limited Vincent Wai Shun Lai

Company Secretary

– 16 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

The following is a summary of the principal terms of the New Share Option Scheme:

1. PURPOSE

The purpose of the New Share Option Scheme is to provide the Participants (who have been granted Options) to subscribe for Shares of the Company with the opportunity to acquire proprietary interests in the Company with a view to encouraging the Participants to work towards enhancing the value of the Company and its Shares for the benefit of the Company and its Shareholders as a whole. The New Share Option Scheme will provide the Company with a flexible means of retaining, incentivising, rewarding, remunerating, compensating and/or providing benefits to the Participants.

2. WHO MAY JOIN AND BASIS OF DETERMINING ELIGIBILITY OF PARTICIPANTS

The Participants are the directors (including executive directors, non-executive directors and independent non-executive directors) and employees of any member of the Group and any advisers, consultants, distributors, contractors, contract manufacturers, suppliers, agents, customers, business partners, joint venture business partners, service providers of any member of the Group as determined by the Board, in its sole discretion, from time to time to have contributed or will contribute to the Group.

In determining the basis of eligibility of each Participant, the Board would take into account such factors as the Board may at its discretion consider appropriate.

3. ADMINISTRATION

This New Share Option Scheme shall be subject to the administration of the Board, and the decisions of the Board shall be final and binding on all parties. The Board shall have the right to (i) interpret and construe the provisions of the New Share Option Scheme, (ii) determine the persons who will be offered Options under the New Share Option Scheme, and the number of Shares and the Exercise Price, subject to paragraph 7 below, in relation to such Options, (iii) subject to paragraphs 16 and 17 below, make such appropriate and equitable adjustments to the terms of the Options granted under this New Share Option Scheme as it deems necessary, and (iv) make such other decisions or determinations as it shall deem appropriate in the administration of the New Share Option Scheme.

The Board shall have the power from time to time to make or vary regulations for the administration and operation of the New Share Option Scheme, provided that the same are not inconsistent with the provisions of the New Share Option Scheme. The Board shall also have the power to delegate its powers to grant Options to Participants and to determine the Exercise Price, to the designated Directors from time to time.

– 17 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

4. LIFE OF THE NEW SHARE OPTION SCHEME

Subject to paragraphs 9 and 18, this New Share Option Scheme shall be valid and effective for a period of 10 years commencing on the Adoption Date. After the expiry of the 10 year period, no further Options shall be offered or granted, but in all other respects the provisions of this New Share Option Scheme shall remain in full force and effect to the extent necessary to give effect to the exercise of any Options granted prior thereto or otherwise as may be required in accordance with the New Share Option Scheme. Options complying with the provisions of the Listing Rules which are granted during the life of the New Share Option Scheme shall continue to be exercisable in accordance with their terms of issue after the end of the said 10 year period.

5. GRANT OF OPTIONS

On and subject to the terms of this New Share Option Scheme and the Listing Rules, the Board shall be entitled at any time on a business day within 10 years after the Adoption Date to make an Offer to any Participant, as the Board may in its absolute discretion select, to take up an Option pursuant to which such Participant may, during the Option Period, subscribe for such number of Shares as the Board may determine at the Exercise Price. The Offer shall specify the terms on which the Option is to be granted. Such terms may include any minimum period(s) after the expiry of which, and/or any minimum performance target(s) that must be reached before the Option can be exercised in whole or in part, and may include at the discretion of the Board other terms, conditions, restrictions or limitations imposed either on a case by case basis or generally. Where an Option was granted subject to certain continuing conditions, restrictions or limitations on the Grantee’s eligibility and the Board resolves that the Grantee has failed to or otherwise is or has been unable to meet such continuing eligibility criteria, the Option (to the extent it has not already been exercised) shall lapse.

Each grant of Options to any director, chief executive or substantial shareholder of the Company (or any of their respective associates) (the aforesaid terms have the meanings ascribed to them under the applicable provisions of the Listing Rules) shall be subject to the prior approval of the independent non-executive Directors (excluding any independent non-executive Director who is a proposed recipient of the grant of Options). 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 total number of 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:–

(a) representing in aggregate over 0.1% (or such other percentage as may from time to time be specified by the Stock Exchange) of the Shares then in issue; and
(b) having an aggregate value, based on the closing price of the Shares as stated in the daily quotations sheets issued by the Stock Exchange on the date of grant, in excess of HK$5 million (or such other amount as may from time to time be specified by the Stock Exchange), such further grant of Options shall be subject

– 18 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

to prior approval by the Shareholders. The Company must send a circular to its Shareholders. The proposed Grantee, his associates and all core connected persons (as such terms are defined in the Listing Rules) of the Company shall abstain from voting in favor of the relevant resolution. Any vote taken at the meeting to approve the grant of such Options must be taken on a poll in accordance with the Listing Rules. The Shareholders’ approval as described above will also be required for any change in the terms of the Options granted to a substantial shareholder of the Company or an independent non-executive Director of the Company or any of their respective associates.

No Offer shall be made and no Option shall be granted to any Participant in circumstances prohibited by the Listing Rules or at a time when the Participant would or might be prohibited from dealing in the Shares by the Listing Rules or by any applicable rules, regulations or law. In particular, (a) after an inside information (as the aforesaid term has the meaning ascribed to it under the applicable provisions of the Listing Rules) has come to the Company’s knowledge and until such inside information has been announced pursuant to the relevant requirements of the Listing Rules; and (b) during the period commencing 1 month immediately preceding the earlier of:–

(a) the date of the meeting of the Board meeting (as such date is first notified to the Stock Exchange in accordance with the requirements of the Listing Rules) for the approval of the Company’s results for any year, half year, quarterly or any other interim period (whether or not required under the Listing Rules); and
(b) the deadline for the Company to publish an announcement of its results for any year or half year as required by Listing Rules, or quarterly or any other interim period (whether or not required under the Listing Rules), and ending on the date of the results announcement, no Option may be granted. For the avoidance of doubt, no Option may be granted during any period of delay in publishing a results announcement.

6. PAYMENT ON ACCEPTANCE OF OPTION OFFER

An Offer shall be made to a Participant by letter in duplicate in such form as the Board may from time to time determine requiring the 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 New Share Option Scheme and shall remain open for acceptance by the Participant to whom the Offer is made for a period of 10 business days from the date on which the letter containing the Offer is issued to that Participant, provided that no such Offer shall be open for acceptance after the 10th anniversary of the Adoption Date or after this New Share Option Scheme has been terminated in accordance with the provisions hereof or after the person/ entity to whom the Offer is made has ceased to be a Participant.

An Offer shall be deemed to have been accepted by the Grantee and the Option to which the Offer relates shall be deemed to have been granted and accepted and to have taken effect when the Company receives the duly signed offer letter from the Grantee with the number of Shares in respect of which the Offer is accepted clearly stated therein,

– 19 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

together with a payment in favour of the Company of HK$1.00 (or other sum in any currency as the Board may determine) by way of consideration for the grant thereof. Such payment shall not be refundable in any circumstances.

7. EXERCISE PRICE

The Exercise Price shall be such price determined by the Board at its absolute discretion and notified to the Participant in the Offer and shall be no less than the higher of:–

(a) the closing price of the Shares as stated in the daily quotations sheet issued by the Stock Exchange on the date of grant;
(b) the average closing price of the Shares as stated in the daily quotations sheets issued by the Stock Exchange for the 5 business days immediately preceding the date of grant; and
(c) the nominal value of a Share on the date of grant.

The Exercise Price shall be subject to adjustment in accordance with paragraph 16.

8. OPTION PERIOD

The Option Period of an Option is the period during which the Grantee may exercise the Option, which is determined and notified by the Board to the Grantee at the time of making an Offer and must not be more than 10 years from the date of grant.

9. CONDITIONS OF THE NEW SHARE OPTION SCHEME

The New Share Option Scheme shall take effect subject to the following conditions:

(a) the passing of an ordinary resolution at a general meeting of the Shareholders approving the adoption of the New Share Option Scheme and authorizing the Board to grant Options to subscribe for Shares and to allot and issue Shares pursuant to the exercise of any Options, and
(b) the Listing Committee of the Stock Exchange granting approval of the listing of and permission to deal in any Shares to be issued pursuant to the exercise of Options.

If the above condition (b) is not satisfied on or before the date following 6 months after the Adoption Date (or such later date as the Board may decide), the New Share Option Scheme shall forthwith terminate, and any Option granted or agreed to be granted pursuant to the New Share Option Scheme and any Offer shall be of no effect and no person shall be entitled to any rights or benefits or be under any obligations under or in respect of the New Share Option Scheme or any such Option.

– 20 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

10. RIGHTS ARE PERSONAL TO GRANTEE

An Option shall be personal to the Grantee and shall not be transferrable or assignable and no Grantee shall in any way sell, transfer, charge, mortgage, encumber or create any interest (legal or beneficial) in favour of any other person over or in relation to any Option (where the Grantee is a company, any change of its major shareholder or any substantial change in its management as determined by the Board at its sole discretion will be deemed to be a sale or transfer of interest as aforesaid, if so determined by the Board at its sole discretion), except that the Grantee may nominate a nominee (the “ Nominee ”), in whose name the Shares issued pursuant to the New Share Option Scheme of which the Grantee is the sole beneficial owner may be registered in the register of members of the Company provided that evidence of such trust arrangement between the Grantee and the Nominee has been provided to the satisfaction of, and on terms acceptable by, the Board and except for the transmission of an Option on the death of the Grantee to his personal representative(s) on terms of and as permitted by the New Share Option Scheme. Any breach of the foregoing shall entitle the Company to cancel, revoke or terminate any outstanding Option or part thereof granted to such Grantee without incurring any liability on the part of the Company.

11. RIGHTS ATTACHING TO SHARES ALLOTTED

The Shares to be allotted and issued upon the exercise of an Option shall be subject to all the provisions of the memorandum of association and bye-laws of the Company for the time being in force and will rank pari passu in all respects with the existing fully paid Shares in issue on the date the name of the Grantee or the Nominee (where applicable) as the holder thereof is registered on the register of shareholders/members of the Company and accordingly shall entitle the holder to participate in all dividends or other distributions (including those arising on a liquidation of the Company) paid or made after the date the name of the Grantee or the Nominee (where applicable) is registered on the register of shareholders/members of the Company other than any dividend or other distribution (including those arising on a liquidation of the Company) previously declared or recommended or resolved to be paid or made if the record date therefor shall be on or before such date. Prior to the Grantee or the Nominee (where applicable) being duly registered on the register of shareholders/members of the Company, the Grantee or the Nominee (where applicable) shall not have any voting rights, or rights to participate in any dividends or distributions (including those arising on a liquidation of the Company), in respect of the Shares to be issued upon the exercise of the Option.

– 21 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

12. EXERCISE OF OPTION

Subject to the terms and conditions upon which such Option is granted, an Option may be exercised by the Grantee at any time during the Option Period, provided that:–

(a) in the event the Grantee (being a director or employee of any member of the Group) ceases to be a Participant for any reason other than (i) his or her death or (ii) on one or more of the grounds of termination of employment or engagement specified in paragraph 13(e) (and the date on which the Grantee so ceased to be a Participant shall be referred to as the “ Cessation Date ”), the Option shall lapse on the Cessation Date 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 Cessation Date shall be the last actual working day on which the Grantee was physically at work under his contract of employment or engagement with the Company or the relevant Subsidiary, whether salary is paid in lieu of notice or not;
(b) in the event the Grantee dies before exercising the Option in full and none of the events for termination of employment or engagement under paragraph 13(e) below then exists with respect to such Grantee, the personal representative(s) of the Grantee shall be entitled within a period of 12 months from the date of death to exercise the Option up to the entitlement of such Grantee as at the date of death;
(c) if a general offer by way of takeover offer or scheme of arrangement (within the meaning ascribed to it under the Companies Act) or otherwise in like manner is made to all the holders of Shares (or all such holders other than the offeror and/or any person controlled by the offeror and/or any person acting in concert with the offeror) and such offer becomes or is declared unconditional (within the meaning of the Codes on Takeovers and Mergers and Share Buy-backs (the “ Takeovers Code ”)), the Grantee shall be entitled to exercise the Option in full or in part at any time within 1 month after the date on which the offer becomes or is declared unconditional (within the meaning of the Takeovers Code) or, if the Company shall give the relevant notification, to the extent notified by the Company;
(d) in the event a notice is given by the Company to its Shareholders to convene a Shareholders’ meeting for the purpose of considering and, if thought fit, approving a resolution to voluntarily wind-up the Company, the Company shall on the same date as or soon after it despatches such notice to each Shareholder of the Company give notice thereof to the Grantee and the Grantee may, by notice in writing to the Company accompanied by the remittance for the total Exercise Price payable in respect of the exercise of the relevant Option (such notice to be received by the Company not later than 2 business days (excluding any period(s) of closure of the Company’s share registers) prior to the proposed meeting or such time as shall be notified by the Company) exercise the Option (to the extent exercisable as at the date of the notice to the Grantee and not exercised) either in full or in part or, if the Company shall give the relevant notification, and the Company shall, as soon as possible and in any event no later than three (3)

– 22 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

business days (excluding any period(s) of closure of the Company’s share registers) immediately prior to the date of the proposed Shareholders’ meeting, allot and issue such number of Shares to the Grantee which falls to be issued to on such exercise and register the Grantee as holder thereof; and

(e) in the event of a compromise or arrangement, other than a scheme of arrangement contemplated in paragraph 12(c) above, between the Company and its Shareholders and/or creditors being proposed in connection with a scheme for the reconstruction or amalgamation of the Company, the Company shall give notice thereof to all Grantees on the same day as it first gives notice of the meeting to its Shareholders and/or creditors to consider such a scheme or arrangement and the Grantee may, by notice in writing to the Company accompanied by the remittance for the total Exercise Price payable in respect of the exercise of the relevant Option (such notice to be received by the Company not later than 2 business days (excluding any period(s) of closure of the Company’s share registers) prior to the proposed meeting or such time as shall be notified by the Company) exercise the Option (to the extent exercisable as at the date of the notice to the Grantee and not exercised) either in full or in part or, if the Company shall give the relevant notification, and the Company shall, as soon as possible and in any event no later than 3 business days (excluding any period(s) of closure of the Company’s share registers) immediately prior to the date of the proposed meeting, allot and issue such number of Shares to the Grantee which falls to be issued on such exercise credited as fully paid and register the Grantee as holder thereof.

13. LAPSE OF OPTION

An Option (to the extent not already exercised) shall lapse and not be exercisable on the earliest of:–

(a) the expiry of the Option Period (subject to the provisions of paragraphs 9 and 18);
(b) the date or the expiry of the periods for exercising the Option as referred to in paragraphs 12(a) and (b) (as the case may be);
(c) the date of commencement of winding-up of the Company;
(d) the date on which the proposed compromise or arrangement becomes effective in respect of the situation contemplated in paragraph 12(e);
(e) the date on which the Grantee (being a director or an employee of any member of the Group when an Offer is made to him/her) ceases to be a Participant by reason of the termination of his/her employment or engagement on any one or more of the grounds that he/she has been guilty of serious misconduct, or has been convicted of any criminal offence involving his/her integrity or honesty, or (if so determined by the Board) on any other ground on which an employer would be

– 23 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

entitled to terminate his/her employment or engagement at common law or pursuant to any applicable laws or regulatory requirements or under the Grantee’s service contract with the Group, and a resolution of the Board to the effect that the employment or engagement on any one or more of a Grantee has or has not been terminated on one or more of the grounds specified in this sub-paragraph shall be conclusive and binding on the Grantee;

(f) the happening of any of the following events, unless otherwise waived by the Board:
(i) any liquidator, provisional liquidator, receiver or any person carrying out any similar function has been appointed anywhere in the world in respect of the whole or any part of the asset or undertaking of the Grantee (being a corporation);
(ii) the Grantee (being a corporation) has ceased or suspended payment of its debts, become unable to pay its debts (within a meaning of section 178 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Chapter 32 of the Laws of Hong Kong) or any similar provisions under the Companies Act) or otherwise become insolvent or has made any arrangement or composition with its creditors generally;
(iii) there is unsatisfied judgment, order or award outstanding against the Grantee or the Company has reason to believe that the Grantee is unable to pay or to have no reasonable prospect of being able to pay his/her/its debts;
(iv) there are circumstances which entitle any person to take any action, appoint any person, commence proceedings or obtain any order of the type mentioned in sub-paragraphs (i), (ii) and (iii) above;
(v) a bankruptcy order has been made against the Grantee or any director of the Grantee (being a corporation) in any jurisdiction; or
(vi) a petition for bankruptcy has been presented against the Grantee or any director of the Grantee (being a corporation) in any jurisdiction;
(g) the date on which a situation as contemplated under paragraph 10 arises;
(h) the date on which the Grantee commits a breach of any terms or conditions attached to the grant of the Option, unless otherwise resolved to the contrary by the Board;
(i) the date on which the Board resolves that the Grantee has failed or otherwise is or has been unable to meet the continuing eligibility criteria as may be prescribed pursuant to paragraph 5;

– 24 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

(j) where the Grantee is a director or an employee of a member of the Group (other than the Company), the date on which such member ceases to be a Subsidiary; and
(k) unless the Board otherwise determines, and other than in the circumstances referred to in paragraphs 12(a) or (b), the date the Grantee ceases to be a Participant (as determined by a Board resolution) for any reason.

14. CANCELLATION OF OPTION

The Board shall have the absolute discretion to cancel any Options granted at any time if the Grantee so agrees provided that where an Option is cancelled and a new Option is proposed to be granted to the same Grantee, the issue of such new Option may only be made with available but unissued Shares in the authorised share capital of the Company, and available ungranted Options (excluding for this purpose all the cancelled Options) within the limits prescribed by paragraph 15 below and otherwise comply with the terms of the New Share Option Scheme.

15. MAXIMUM NUMBER OF SHARES SUBJECT TO OPTIONS

(a) The maximum number of Shares in respect of which options may be granted under the New Share Option Scheme and any other schemes involving the issue or grant of options or similar rights over Shares or other securities by the Company shall not, in aggregate, exceed 10% of the Shares in issue as at the Adoption Date (the “ Scheme Mandate Limit ”) unless approved by the Shareholders pursuant to paragraph 15(c) below. Options lapsed in accordance with the terms of the New Share Option Scheme or any other schemes referred to above will not be counted for the purpose of calculating the Scheme Mandate Limit.
(b) The Scheme Mandate Limit may be renewed by the Shareholders in general meeting from time to time provided always that the Scheme Mandate Limit so renewed must not exceed 10% of the Shares in issue as at the date of approval of such renewal by Shareholders in general meeting. Upon such renewal, all options granted under the New Share Option Scheme and any other share option schemes of the Company (including those exercised, outstanding, cancelled, lapsed in accordance with the terms of the Scheme or any other share option schemes of the Company) prior to the approval of such renewal shall not be counted for the purpose of calculating the Scheme Mandate Limit as renewed. A circular must be sent to the Shareholders containing such relevant information from time to time as required by the Listing Rules in connection with the general meeting at which their approval is sought.

– 25 –

APPENDIX I

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

(c) The Board may seek separate Shareholders’ approval in general meeting to grant Options beyond the Scheme Mandate Limit or the Scheme Mandate Limit as renewed provided that the Options in excess of the Scheme Mandate Limit or the Scheme Mandate Limit as renewed are granted only to the Participants specified by the Company before such approval is sought and the Company must issue a circular to the Shareholders containing such relevant information from time to time required by the Listing Rules in relation to any such proposed grant to such Participants.
(d) The maximum number of Shares which may be issued upon exercise of all outstanding Options granted and yet to be exercised under the Scheme and any other schemes involving the issue or grant of options or similar rights over Shares or other securities by the Company must not, in aggregate, exceed 30% of the Shares in issue from time to time. Notwithstanding anything contrary to the terms of the New Share Option Scheme, no Options may be granted under any scheme of the Company (including the Scheme) if this will result in the said 30% limit being exceeded.
(e) No Option may be granted to any Participant which, if exercised in full, would result in the total number of Shares issued and to be issued upon exercise of the Options already granted or to be granted to such Participant under the Scheme (including exercised, cancelled and outstanding share Options) in the 12-month period up to and including the date of such new grant exceeding 1% in aggregate of the Shares in issue as at the date of such grant. Any grant of further Options above this limit shall be subject to the requirements set out under Rule 17.03(4) and other applicable provisions under the Listing Rules. The number and terms of Options to be granted to such Participants shall be fixed before Shareholders’ approval is sought and the date of the Board meeting for proposing such further grant shall be the date of grant for the purpose of calculating the Exercise Price.
(f) The maximum number of Shares referred to in this paragraph shall be adjusted, in such manner as the Auditors or the independent financial adviser of the Company shall certify as fair and reasonable in accordance with paragraph 16 below.

– 26 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

16. REORGANISATION OF CAPITAL STRUCTURE

In the event of capitalisation issue, rights issue, consolidation, sub-division, or reduction of the share capital of the Company, other than any alteration in the capital structure of the Company as a result of an issue of Shares as consideration in a transaction to which the Company is a party, whilst any Option remains exercisable, corresponding alterations (if any) shall be made to:

(a) the number or nominal amount of Shares which are the subject of unexercised Options;
(b) the Exercise Price;
(c) the method of exercise of the Options; and/or
(d) the maximum number of Shares subject to the New Share Option Scheme.

Any adjustments required under this paragraph must give a Grantee the same proportion of the equity capital as that to which that Grantee was previously entitled but no such adjustments may be made to the extent that Shares would be issued at less than nominal value. For the avoidance of doubt, the issue of securities as consideration in a transaction may not be regarded as a circumstance requiring adjustment. In respect of any such adjustments, other than any made on a capitalisation issue, the independent financial adviser of the Company or the Auditors must confirm to the Directors in writing that the adjustments satisfy the requirements set out in this paragraph and Rule 17.03(13) of the Listing Rules. Any adjustment to be made to the Exercise Price of, and/or the number of Shares subject to, and any Options to be granted under, the New Share Option Scheme will comply with Chapter 17 of the Listing Rules and all guidance/interpretation of the Listing Rules from time to time. The capacity of the Auditors or the approved independent financial adviser, as the case may be, in this paragraph is that of experts and not arbitrators and their certificate shall, in the absence of manifest error, be final and conclusive and binding on the Company and the Grantee.

– 27 –

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

APPENDIX I

17. ALTERATION OF THE NEW SHARE OPTION SCHEME

(a) The New Share Option Scheme may be altered in any respect by a resolution of the Board except that alterations relating to matters contained in Rule 17.03 of the Listing Rules (or any other relevant provisions of the Listing Rules from time to time applicable) to the advantage of the Participants or the Grantees shall not be made except with the prior approval of the Shareholders in general meeting (with those Participants and the Grantees to whose advantage the New Share Option Scheme is proposed to be altered abstaining from voting at such general meeting).
(b) Any alteration to the terms and conditions of the New Share Option Scheme which is of a material nature must be approved by the Shareholders in general meeting, except where the alterations take effect automatically under the existing terms of the New Share Option Scheme.
(c) The amended terms of the New Share Option Scheme or the Options must still comply with the relevant requirements of Chapter 17 of the Listing Rules.
(d) Any change to the authority of the Board in relation to any alteration to the terms of the New Share Option Scheme must first be approved by the Shareholders in general meeting.
(e) Any amendment to the terms of Options granted must be approved by the Shareholders in general meeting, except where such amendment takes effect automatically under the existing terms of the New Share Option Scheme.
(f) Notwithstanding any approval obtained from the general meeting, no amendment shall operate to adversely affect the terms of issue of any Option granted or agreed to be granted prior to such amendment except with the consent or sanction in writing of such number of Grantees as shall together hold options in respect of not less than three-fourths in nominal value of all Shares then subject to the options granted under the New Share Option Scheme, except where such amendment takes effect automatically under the existing terms of the New Share Option Scheme.

18. TERMINATION OF THE NEW SHARE OPTION SCHEME

The Company by ordinary resolution in general meeting or the Board may at any time terminate the operation of the New Share Option Scheme and in such event no further Options will be offered or granted but in all other respects the provisions of the New Share Option Scheme shall remain in full force and effect to the extent necessary to give effect to the exercise of any Options granted prior thereto or otherwise as may be required in accordance with the provisions of the New Share Option Scheme. Options which are unexercised and unexpired immediately prior to the termination of the operation of this New Share Option Scheme shall continue to be valid and exercisable in accordance with their terms of issue after the termination of the New Share Option Scheme.

– 28 –

NOTICE OF SGM

APPENDIX II

==> picture [92 x 41] intentionally omitted <==

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

NOTICE IS HEREBY GIVEN THAT a special general meeting (“ SGM ”) of Sunwah Kingsway Capital Holdings Limited (the “ Company ”) will be held at 7/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong on Tuesday, 24 November 2020 at 10:30 a.m. (or at such time immediately following the conclusion (or adjournment) of the annual general meeting of the Company to be held on the same day and at the same place, whichever is later) for the purpose of considering and, if thought fit, with or without amendments, passing the following resolutions as ordinary resolutions:

ORDINARY RESOLUTIONS

“ THAT subject to and conditional upon the granting of approval by the Listing Committee of The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”) of the listing of, and permission to deal in, the issued and unissued shares of the Company consolidated in the manner as set out in paragraph (a) of this resolution below (the “ Share Consolidation ”):
(a) with effect from the second business day immediately following the date on which this resolution is passed:
- (i) every ten (10) issued and unissued ordinary shares of par value of HK$0.01 each in the share capital of the Company be consolidated into one (1) share of par value of HK$0.10 each (each a “ Consolidated Share ”);
- (ii) the Consolidated Shares shall rank pari passu in all respects with each other and have the rights and privileges and be subject to the restrictions as contained in the memorandum of association and bye-laws of the Company; and
- (iii) all fractional Consolidated Shares will be disregarded and not issued to the shareholders of the Company but all such fractional Consolidated Shares will be aggregated and, if possible, sold for the benefit for the Company; and
(b) the board of directors of the Company (the “ Directors ”) and such person or persons authorized by the Directors be and are hereby authorized to do all such acts and things and execute all such documents, including under seal

– 29 –

NOTICE OF SGM

APPENDIX II

where applicable, as the Directors shall, in their absolute discretion, consider necessary, desirable or expedient to give effect to the foregoing arrangement for the Share Consolidation.”

“ THAT subject to and conditional upon the granting of approval by the Listing Committee of the Stock Exchange of the listing of, and permission to deal in, the shares of HK$0.01 each in the ordinary share capital of the Company, or the Consolidated Shares, as the case may be (collectively, “ Shares ”), to be issued pursuant to the exercise of the share options which may be granted under the proposed new share option scheme (the “ New Share Option Scheme ”), a copy of which is tabled at the SGM and marked “ A ”:
(a) the New Share Option Scheme be and is hereby approved and adopted; and

(b) the Directors be and are hereby authorized to, subject to the applicable laws, rules and regulations, including but not limited to the Rules Governing the Listing of Securities on the Stock Exchange (the “ Listing Rules ”) and the rules of the New Share Option Scheme:

(i) grant options to subscribe for the Shares in accordance with the rules of the New Share Option Scheme;
(ii) allot, issue and deal with from time to time such number of Shares as may be required to be issued pursuant to the exercise of the options under the New Share Option Scheme;
(iii) modify and/ or amend the New Share Option Scheme from time to time;
(iv) administer the New Share Option Scheme generally;
(v) do all such acts and to enter into all such transactions, arrangements and agreements as the Directors in their sole discretion consider necessary, desirable or expedient in order to give full effect to the New Share Option Scheme; and
(vi) consent, if the Directors in their sole discretion consider necessary, desirable or expedient, to such conditions, alteration and/or modification as may be required or imposed by the relevant authorities in relation to the New Share Option Scheme.”

Yours faithfully,

For and on behalf of the Board of

Sunwah Kingsway Capital Holdings Limited Vincent Wai Shun Lai Company Secretary

Hong Kong, 20 October 2020

– 30 –

NOTICE OF SGM

APPENDIX II

Notes:

All resolutions at the SGM will be taken by poll pursuant to the Listing Rules. The results of the poll will be published on the Stock Exchange’s website (www.hkex.com.hk) and the Company’s website (www.sunwahkingsway.com) in accordance with the Listing Rules.
A member of the Company entitled to attend and vote at the SGM is entitled to appoint one or more proxies, to attend and vote on his/her behalf. A proxy need not be a member of the Company. If more than one proxy is so appointed, the appointment shall specify the number of shares in respect of which each such proxy is so appointed.
To be valid, the form of proxy together with the authorization letter or other authority (if any) under which is signed or a notarially certified copy thereof, must be deposited at the branch share registrar of the Company, in Hong Kong, Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the SGM, or any adjournment hereof.
Completion and delivery of the form of proxy will not preclude a member from attending and voting in person at the SGM if the member so desires and in such event, the instrument appointing a proxy shall be deemed to be revoked.
For the purposes of determining members’ eligibility to attend, speak and vote at the SGM, the latest time to lodge transfer documents for registration with the Company’s registrar will be 4:30 p.m. on Wednesday, 18th November 2020.
Where there are joint registered holders of any share, any one of such persons may vote at the SGM, either personally or by proxy, in respect of such share as if he/she was solely entitled thereto, but if more than one of such joint holders be present at the SGM, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the register of members of the Company in respect of the joint holding.
If a Black Rainstorm Warning Signal is in force at or at any time after 9:00 a.m. on the date of the SGM, the SGM will be postponed or adjourned. The Company will post an announcement on the Stock Exchange’s website (www.hkex.com.hk) and the Company’s website (www.sunwahkingsway.com) to notify members of the date, time and place of the rescheduled SGM.

The SGM will be held as scheduled when an Amber or a Red Rainstorm Warning Signal is in force. Members should decide on their own whether they would attend the SGM under bad weather condition bearing in mind their own situations.

The translation into Chinese language of the above notice is for reference only. In case of any inconsistency, the English version shall prevail.
Due to the recent development of the epidemic COVID-19, the Company will implement the following precautionary measures at the SGM against the epidemic to protect the members of the Company from the risk of infection:
(i) compulsory body temperature check will be conducted for every member or proxy at the entrance of the venue. Any person with a body temperature of over 37.5 degrees Celsius will not be admitted to the venue;
(ii) every member or proxy is required to (a) fill in health declaration form with information including travelling record and health condition; and (b) wear surgical facial mask throughout the SGM. Any person who refuses to follow the aforesaid will not be admitted to the venue;
(iii) every member or proxy who has travelled from jurisdictions, which according to the Department of Health of Hong Kong would render such person subject to a quarantine order, within 14 days immediately prior to the SGM will not be admitted to the venue; and

– 31 –

NOTICE OF SGM

APPENDIX II

(iv) no refreshments will be served at the SGM.

Furthermore, the Company wishes to strongly advise the members, particularly those who are unwell or subject to quarantine in relation to COVID-19, that they may appoint any person or the chairman of the SGM as a proxy to vote on the resolutions to be proposed at the SGM, instead of attending the SGM in person.

As at the date of this notice, the directors of the Company are Jonathan Koon Shum Choi as Chairman, Michael Koon Ming Choi as Chief Executive Officer & Executive Director, Janice Wing Kum Kwan and Lee G. Lam as Non-Executive Directors, Robert Tsai To Sze, Elizabeth Law and Huanfei Guan as Independent Non-Executive Directors.

– 32 –

AI assistant

China Display Optoelectronics Technology Holdings Limited — Proxy Solicitation & Information Statement 2020

49136_rns_2020-10-20_798abb44-bd66-4aa6-aa63-9c514be18aab.pdf

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(1) PROPOSED SHARE CONSOLIDATION;

(2) PROPOSED CHANGE IN BOARD LOT SIZE;

(3) PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME; AND

NOTICE OF SPECIAL GENERAL MEETING

PRECAUTIONARY MEASURES FOR THE SPECIAL GENERAL MEETING

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

EXPECTED TIMETABLE

Event

EXPECTED TIMETABLE

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(1) PROPOSED SHARE CONSOLIDATION; (2) PROPOSED CHANGE IN BOARD LOT SIZE; (3) PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME; AND

NOTICE OF SPECIAL GENERAL MEETING

1. INTRODUCTION

2. PROPOSED SHARE CONSOLIDATION

Conditions of the Share Consolidation

Effects of the Share Consolidation

LETTER FROM THE BOARD

Listing application

Fractional entitlement to the Consolidated Shares

Arrangement in relation to the trading of odd lots

LETTER FROM THE BOARD

Exchange of share certificates

Adjustments in relation to other securities of the Company

3. PROPOSED CHANGE IN BOARD LOT SIZE

Reasons for the Share Consolidation and the Change in Board Lot Size

LETTER FROM THE BOARD

4. PROPOSED ADOPTION OF THE NEW SHARE OPTION SCHEME

The 2010 Share Option Scheme

LETTER FROM THE BOARD

Proposed adoption of the New Share Option Scheme

LETTER FROM THE BOARD

Scope of Participants

LETTER FROM THE BOARD

Listing application

Conditions of the New Share Option Scheme

Principal Terms of the New Share Option Scheme

5. SGM

6. RECOMMENDATION

7. RESPONSIBILITY STATEMENT

1. PURPOSE

2. WHO MAY JOIN AND BASIS OF DETERMINING ELIGIBILITY OF PARTICIPANTS

3. ADMINISTRATION

4. LIFE OF THE NEW SHARE OPTION SCHEME

5. GRANT OF OPTIONS

APPENDIX I

6. PAYMENT ON ACCEPTANCE OF OPTION OFFER

APPENDIX I

7. EXERCISE PRICE

8. OPTION PERIOD

9. CONDITIONS OF THE NEW SHARE OPTION SCHEME

10. RIGHTS ARE PERSONAL TO GRANTEE

11. RIGHTS ATTACHING TO SHARES ALLOTTED

12. EXERCISE OF OPTION

13. LAPSE OF OPTION

APPENDIX I

APPENDIX I

14. CANCELLATION OF OPTION

15. MAXIMUM NUMBER OF SHARES SUBJECT TO OPTIONS

APPENDIX I

SUMMARY OF THE PRINCIPAL TERMS OF THE NEW SHARE OPTION SCHEME

16. REORGANISATION OF CAPITAL STRUCTURE

APPENDIX I

17. ALTERATION OF THE NEW SHARE OPTION SCHEME

18. TERMINATION OF THE NEW SHARE OPTION SCHEME

SUNWAH KINGSWAY CAPITAL HOLDINGS LIMITED 新華滙富金融控股有限公司

(Stock Code: 00188)

ORDINARY RESOLUTIONS

More from China Display Optoelectronics Technology Holdings Limited

China Display Optoelectronics Technology Holdings Limited Proxy Solicitation & Information Statement 2020