China First Capital Group Limited — Proxy Solicitation & Information Statement 2016

Mar 17, 2016

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 licensed securities dealer or registered institution in securities, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in the Company, you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, 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.

CHINA FIRST CAPITAL GROUP LIMITED 中國首控集團有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1269)

REFRESHMENT OF GENERAL MANDATE AND NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

==> picture [111 x 54] intentionally omitted <==

Capitalised terms used in this cover page have the same meanings as those defined in this circular.

A letter from the Board is set out on pages 4 to 12 in this circular. A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 13 in this circular. A letter from Astrum Capital Management Limited containing its advice in respect of the Refreshed General Mandate to the Independent Board Committee and the Independent Shareholders is set out on pages 14 to 25 in this circular.

A notice convening the EGM to be held at 10:30 a.m. on Thursday, 7 April 2016 at Units 4501–02 & 12–13, 45/F, The Center, 99 Queen’s Road Central, Hong Kong is set out on pages EGM-1 to EGM-2 in this circular.

A form of proxy for use at the EGM is enclosed.

Whether or not you are able to attend the meeting, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to Hong Kong branch share registrar and transfer office of the Company, Tricor Investor Services 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 meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the meeting or any adjournment thereof should you so wish.

18 March 2016

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Letter from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Notice of EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

DEFINITIONS

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

“2015 AGM” the annual general meeting of the Company held on 9 June 2015

“2015 EGM” the extraordinary general meeting of the Company held on 8 December 2015

• “Announcement” the announcement of the Company dated 25 February 2016 in relation to the refreshment of the Existing General Mandate

• “associate” has the same meaning ascribed to it under the Listing Rules

• “Board” the board of Directors

• “Company”

China First Capital Group Limited, a company incorporated in the Cayman Islands with limited liability and the issued Shares of which are listed on the Stock Exchange

• “controlling shareholder(s)” has the meaning ascribed to it under the Listing Rules

“Directors” the directors (including the independent non-executive directors) of the Company

“EGM”

the extraordinary general meeting of the Company to be held at 10:30 a.m. on Thursday, 7 April 2016 at Unit 4501–02 & 12–13, 45/F., The Center, 99 Queen’s Road Central, Hong Kong for the purpose of considering and, if thought fit, approving the Refreshed General Mandate by the Independent Shareholders

• “Existing General Mandate”

the general mandate granted to the Directors by the resolution of the Independent Shareholders passed at the 2015 EGM to allot, issue and deal with Shares not exceeding 20% of the issued share capital of the Company as at the date of the 2015 EGM

“First Placing”

the placing of new Shares under the general mandate granted at the 2015 AGM announced by the Company on 5 October 2015

• “Group”

the Company and its subsidiaries

• “Hong Kong”

the Hong Kong Special Administrative Region of the PRC

– 1 –

DEFINITIONS

• “Independent Board Committee”

• “Independent Financial Adviser”

• “Independent Shareholders”

• “Latest Practicable Date”

• “Listing Rules”

• “PRC”

• “Refreshed General Mandate”

• “Second Placing”

• “Share(s)”

• “Shareholder(s)”

• an independent board committee of the Company comprising all the independent non-executive Directors to advise the Independent Shareholders on the proposed grant of the Refreshed General Mandate

• Astrum Capital Management Limited, a licensed corporation permitted to carry out type 1 (dealing in securities), type 2 (dealing in futures contracts), type 6 (advising on corporate finance) and type 9 (asset management) regulated activities under the Securities and Futures Ordinance (Cap. 571 of the Law of Hong Kong), being the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders in relation to the Refreshed General Mandate

• Shareholders other than any controlling Shareholders and their respective associates or, where there are no controlling shareholders, any Directors (excluding independent non-executive Directors) and the chief executive of the Company and their respective associates

• 16 March 2016, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained in this circular

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

• the People’s Republic of China which for the purpose of this circular, shall exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

• the new general mandate proposed to be granted at the EGM to authorise the Directors to allot, issue and deal with the Shares not exceeding 20% of the issued share capital of the Company as at date of passing of the relevant resolution

• the placing of new Shares under the Existing General Mandate announced by the Company on 10 December 2015

• ordinary share(s) of HK$0.10 each in the share capital of the Company

• holder(s) of the Share(s)

– 2 –

DEFINITIONS

“Stock	Exchange”	The Stock Exchange of Hong Kong Limited
“HK$”		Hong Kong dollars, the lawful currency for the time being
		of Hong Kong
“%”		per cent.

– 3 –

LETTER FROM THE BOARD

CHINA FIRST CAPITAL GROUP LIMITED 中國首控集團有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1269)

Executive Directors: Mr. Wilson Sea (Chairman) Mr. Zhao Zhijun (Chief Executive Officer) Mr. Yan Haiting Mr. Wang Wenbo Ms. Yang Weixia

Registered office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Independent non-executive Directors:

Mr. Chu Kin Wang, Peleus Mr. Li Zhiqiang Mr. Zhang Jinhua

Principal place of business in Hong Kong: Units 4501–02 & 12–13, 45/F The Center 99 Queen’s Road Central Hong Kong

18 March 2016

To the Shareholders

Dear Sir or Madam,

REFRESHMENT OF GENERAL MANDATE AND NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the Announcement relating to the proposed refreshment of the Existing General Mandate. The purpose of this circular is to provide you with (i) information in respect of the proposed grant of the Refreshed General Mandate; (ii) the recommendation of the Independent Board Committee to the Independent Shareholders in respect of the Refreshed General Mandate; (iii) a letter of advice from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the Refreshed General Mandate; and (iv) the notice of the EGM.

EXISTING GENERAL MANDATE

At the 2015 AGM, the Shareholders approved, among other things, a general mandate which authorised the Directors to issue not more than 76,800,000 Shares, being 20% of the issued share capital of the Company of 384,000,000 Shares as at the date of the 2015 AGM.

– 4 –

LETTER FROM THE BOARD

At the 2015 EGM, the Independent Shareholders approved the grant of the Existing General Mandate which authorised the Directors to issue not more than 92,160,000 Shares, being 20% of the issued share capital of the Company of 460,800,000 Shares as at the date of the 2015 EGM.

Reference is made to the announcements of the Company dated 10 December 2015 and 23 December 2015, respectively, in relation to the placing of new Shares under the Existing General Mandate. Upon completion of such placing of new Shares on 23 December 2015, the Existing General Mandate was fully utilized by the Company. No new Share can be issued under the Existing General Mandate.

PROPOSED REFRESHMENT OF THE EXISTING GENERAL MANDATE

The Company will convene the EGM at which an ordinary resolution will be proposed to the Independent Shareholders that the Directors be granted the Refreshed General Mandate to allot and issue Shares not exceeding 20% of the issued share capital of the Company as at the date of passing the relevant ordinary resolution at the EGM.

Subject to the approval of the Independent Shareholders of the Refreshed General Mandate, and assuming that no Shares will be issued and/or repurchased by the Company on or prior to the date of the EGM, the Shares in issue as at the date of the EGM would be 552,960,000 Shares. Under the Refreshed General Mandate, the Directors will be authorised to allot, issue and deal with a maximum of 110,592,000 Shares.

The Refreshed General Mandate will, if granted, expire at the earliest of: (i) the conclusion of the next annual general meeting of the Company; (ii) the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company or any applicable laws and regulations of the Cayman Islands to be held; or (iii) the date on which the authority set out in the resolution for the approval of the Refreshed General Mandate is revoked or varied by the passing of an ordinary resolution of the Shareholders in general meeting.

REASONS FOR THE REFRESHED GENERAL MANDATE

The Company is an investment holding company. The Group is principally engaged in the research and development, design, manufacturing and sale of various automobile shock absorbers and has more than 50 years of experience in the industry. Since the end of 2014, the Group has tapped into new business including investment migration advisory services and financial consultancy and advisory services, in order to facilitate the diversification of the Group’s business and further expand its asset portfolio and revenue sources.

The Company expects that its next annual general meeting will be held in or about June 2016, which is about three months from the Latest Practicable Date. Pursuant to the Listing Rules, should the Company wish to issue new Shares or any equity-linked securities before the grant of a new general mandate in the next annual general meeting of the Company, the Company should make an announcement, issue a circular and seek the Shareholders’ approval in an extraordinary general meeting. The procedures may hinder the progress of potential funding raising, investment and/or acquisition plans the Company may have. In the absence of the Refreshed General Mandate, the Company will not be able to issue new Shares or other equity-linked securities in a timely

– 5 –

LETTER FROM THE BOARD

manner. As at the Latest Practicable Date, the Company had not yet formulated any concrete plan for raising capital by issuing new Shares under the Refreshed General Mandate. Further, the Refreshed General Mandate, if approved by the Independent Shareholders at the EGM, will expire at the next annual general meeting of the Company. Nevertheless, the Board consider that it would be in the benefit of the Company and the Shareholders for the Company to maintain flexibility in issuing new Shares or other equity-linked securities in the period between the EGM and the next annual general meeting of the Company.

With respect to business and development plans, the Group will continue to diversify and develop new businesses with a view to enhancing its income stream. In 2015, the Group has tapped into the areas of consulting services for investment immigration and financial investment (“ New Businesses ”). As at the Latest Practicable Date, the Group was in preliminary discussions on a possible acquisition of certain equity interests in a company which is principally engaged in the provision of financial advisory services and investment in private equity funds in the PRC (“ Potential Acquisition ”). The estimated investment size for the Potential Acquisition amounts to approximately RMB400 million. As at the Latest Practicable Date, no binding agreements have been entered into by the Group in respect of the Potential Acquisition and the Potential Acquisition may or may not materialise. In view of the fact that the New Businesses are still at the initial stage, the Group expects that more time, effort and financial resources are required for the development of the New Businesses, and the Group has been pursuing further investments and/or acquisitions of business or companies which may bring synergy and growth to the New Businesses. The Refreshed General Mandate would provide the Company with the necessary flexibility essential for fulfilling any possible funding needs, settlement methods for future business development and/or investment decisions (including but not limited to the Potential Acquisition).

As disclosed in the paragraph “Equity fund raising activities involving the utilisation of the general mandate granted at the 2015 AGM or the Existing General Mandate” below, the majority of proceeds raised from the First Placing have been utilised as intended and HK$175.0 million out of HK$182.0 million raised from the Second Placing has been used to subscribe for 35% shares in Guolian Financial Holding Group Co., Limited (國聯金融控股集團有限公司) in March 2016, while the remaining unutilised proceeds from the First Placing and the Second Placing of approximately HK$38.8 million will be used as intended. It is therefore important for the Company to the have the financial flexibility necessary for the Group’s business development and expansion.

Having considered that (a) the Existing General Mandate has been fully utilised as at the Latest Practicable Date; and (b) the Refreshed General Mandate will empower the Directors to issue new Shares under the refreshed limit speedily and provide the Company with the flexibility and ability to capture any appropriate capital raising or business opportunities which may arise, the Directors consider that the grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole. Therefore, the Board proposes to seek the approval of Independent Shareholders to refresh the Existing General Mandate at the EGM.

– 6 –

LETTER FROM THE BOARD

OTHER FINANCING ALTERNATIVES

Apart from equity financing by issue of new Shares under the Refreshed General Mandate (if granted to the Directors), the Company will also consider other financing methods (such as debt financing, rights issue and/or open offer) to meet the financial requirements of the Group, as and when appropriate, after taking into account the then financial position, capital structure and cost of funding of the Group as well as the prevailing market condition.

However, debt financing such as bank borrowing may incur interest burden to the Group and may be subject to lengthy due diligence and negotiations. In addition, the ability of the Group to obtain bank borrowing usually depends on the Group’s profitability, financial position and the then prevailing market condition. Given the financial performance and position of the Group as disclosed in the published financial reports, the Company considers that it might be difficult for the Group to obtain bank borrowing at a reasonable interest rate.

In respect of rights issue or open offer, it usually involves substantial time and cost to complete as compared to equity financing through issuance of new Shares under the Refreshed General Mandate, which allows the Company to raise capital within specified number of Shares promptly and when necessary. Further, rights issues and open offers will incur payment of underwriting commission by the Company.

Having considered that (i) the proposed grant of the Refreshed General Mandate will provide the Company with an additional financing alternative to capture any capital raising or prospective investment, as and when it arises, in a timely manner; (ii) the equity financing by using the Refreshed General Mandate is less costly and time-consuming than raising fund by way of rights issue or open offer; and (iii) it is reasonable for the Company to maintain its flexibility in the selection of the best financing method for its future business development, the Company is of the view that the proposed grant of the Refreshed General Mandate is in the interest of the Company and the Shareholders as a whole.

– 7 –

LETTER FROM THE BOARD

EQUITY FUND RAISING ACTIVITIES INVOLVING THE UTILISATION OF THE GENERAL MANDATE GRANTED AT THE 2015 AGM AND THE EXISTING GENERAL MANDATE

Save for the equity fund raising activity set out below, the Company had not carried out any other equity fund raising activities involving the utilisation of the general mandate granted at the 2015 AGM or the Existing General Mandate during the period from the date of the 2015 AGM and up to the Latest Practicable Date.

		Estimated net			Actual use of proceeds	Actual use of proceeds
Date of	Fund raising	proceeds	Proposed used of		as at the Latest
announcement	activities	(approximately)	proceeds		Practicable Date
5 October 2015	Placing of 76,800,000	HK$151.6 million	(i)	Approximately	(i)	Approximately
	new Shares at the			HK$60.4 million		HK$42.9 million
	placing price of			shall be used to		has been used to
	HK$2.00 per placing			finance the		finance the
	share			development of		development of
				investment migration		investment
				advisory services and		migration advisory
				financial consultancy		services and
				and advisory services		financial
				of the Group;		consultancy and
						advisory services of
						the Group;
			(ii)	approximately	(ii)	approximately
				HK$50.0 million		HK$53.0 million
				shall be used for the		has been used for
				development of		the development of
				financing and		financing and
				financial credit		financial credit
				business; and		business; and
			(iii)	approximately	(iii)	approximately
				HK$41.2 million		HK$23.9 million
				shall be used for		has been used for
				general working		general working
				capital of the Group.		capital of the
						Group.
					The remaining proceeds
					which had not been
					utilised will be used as
					intended and had been
					maintained at a bank as
					at the Latest
					Practicable Date.

– 8 –

LETTER FROM THE BOARD

Estimated net Actual use of proceeds Date of Fund raising proceeds Proposed used of as at the Latest announcement activities (approximately) proceeds Practicable Date 10 December 2015 Placing of 92,160,000 HK$182.0 million Shall be used for general HK$175.0 million has new Shares at the working capital of the been used to subscribe placing price of Group and/or for funding for 35% shares in HK$2.00 per placing of business or investment Guolian Financial share opportunities if so arise. Holding Group Co., Limited (國聯金融控股 集團有限公司) as disclosed in the announcement of the Company date 29 December 2015 in March 2016. The remaining proceeds which had not been utilised will be used as intended and had been maintained at a bank as at the Latest Practicable Date.

SHAREHOLDING DILUTION EFFECTS

The following table sets out (i) the dilution effects of the First Placing and the Second Placing, being the fund raising activities carried out by the Company in the twelve months immediately prior to the Latest Practicable Date; and (ii) the cumulative dilution effects to the shareholding held by public Shareholders of 220,970,000 Shares (the “ Initial Public Shareholding ”), representing approximately 57.54% of the then issued Share, prior to the completion of the First Placing:

		Initial Public
		Shareholding	Dilution effects		Cumulative
		(being	of fund raising		dilution effects
		220,970,000	activity to the		to the Initial
	Total no. of	Shares) to total	Initial Public		Public
	Shares	no. of Shares	Shareholding		Shareholding
		Approximate %	Approximate %		Approximate %
Immediately prior to
completion of the
First Placing	384,000,000	57.54		–	–
Immediately after completion
of the First Placing	460,800,000	47.95		16.67	16.67
Immediately after completion
of the Second Placing	552,960,000	39.96		16.67	30.56
Immediately after full
utilisation of the Refreshed
General Mandate	663,552,000	33.30		16.67	42.13

– 9 –

LETTER FROM THE BOARD

The following table sets out the shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) upon full utilisation of the Refreshed General Mandate, assuming that no Shares will be issued and/or repurchased during the period commencing from the Latest Practicable Date and up to the date of the EGM:

Shareholders Hongkong Chuang Yue Co., Limited(1) Wealth Max Holdings Limited(2) Mr. Wang Wenbo(3) Ms. Yang Weixia(4) Public Shareholders Shares that may be issued under the Refreshed General Mandate Total	As at the Latest Practicable Date Shares % 129,932,000 23.50 102,104,000 18.46 1,200,000 0.22 960,000 0.17 318,764,000 57.65 – – 552,960,000 100.00	Upon full utilisation of the Refreshed General Mandate Shares % 129,932,000 19.58 102,104,000 15.39 1,200,000 0.18 960,000 0.14 318,764,000 48.04 110,592,000 16.67 663,552,000 100.00	Upon full utilisation of the Refreshed General Mandate Shares % 129,932,000 19.58 102,104,000 15.39 1,200,000 0.18 960,000 0.14 318,764,000 48.04 110,592,000 16.67 663,552,000 100.00
			100.00

Notes:

1. Hongkong Chuang Yue Co., Limited is owned as to 90% by Shenmane.D Co., Limited, which in turn is wholly owned by Golden Cloud Co., Limited, and which in turn is wholly owned by Mr. Tang Mingyang.

2. Wealth Max Holdings Limited is wholly owned by Mr. Wilson Sea, the chairman of the Company and an executive Director.

3. Mr. Wang Wenbo is an executive Director.

4. Ms. Yang Weixia is an executive Director.

Having considered that, assuming that none of the new Shares to be issued under the Refreshed General Mandate will be issued to any of the existing Shareholders, the shareholding interests of all Shareholders will be decreased in proportion to their respective shareholdings upon any utilisation of the Refreshed General Mandate, the Company considers that the potential dilution of the shareholding of the existing public Shareholders is justifiable.

LISTING RULES IMPLICATIONS

As the grant of the Refreshed General Mandate is to be proposed to the Shareholders before the Company’s next annual general meeting, pursuant to the Listing Rules, this proposal is subject to the Independent Shareholders’ approval by way of poll at the EGM. According to Rule 13.36(4) of the Listing Rules, any controlling shareholders and their associates or, where there are no controlling shareholders, Directors (excluding independent non-executive Directors) and the chief executive of the Company and their respective associates shall abstain from voting in favour of the resolution to approve the grant of the Refreshed General Mandate.

As at the Latest Practicable Date, to the best knowledge, information and belief of the Directors, the Company has no controlling shareholders. As at the Latest Practicable Date, (i) Mr. Wilson Sea indirectly held 102,104,000 Shares, representing approximately 18.46% of the total

– 10 –

LETTER FROM THE BOARD

issued share capital of the Company; (ii) Mr. Wang Wenbo directly held 1,200,000 Shares, representing approximately 0.22% of the total issued share capital of the Company; and (iii) Ms. Yang Weixia directly held 960,000 Shares, representing approximately 0.17% of the total issued share capital of the Company. As at the Latest Practicable Date, Mr. Zhao Zhijun and Mr. Yan Haiting did not hold any Share. As a result, Mr. Wilson Sea, Mr. Wang Wenbo and Ms. Yang Weixia, being executive Directors, together with their respective associates are required to abstain from voting in favour of the ordinary resolution to approve the grant of the Refreshed General Mandate at the EGM. If any Share is held by any Directors (excluding independent non-executive Directors) on the date of the EGM, such Director together with his/her respective associates are required to abstain from voting in favour of the ordinary resolution to approve the grant of the Refreshed General Mandate at the EGM.

EGM

A notice convening the EGM to be held at Units 4501–02 & 12–13, 45/F, The Center, 99 Queen’s Road Central, Hong Kong at 10:30 a.m., Thursday, on 7 April 2016 is set out on pages EGM-1 to EGM-2 of this circular.

The Independent Board Committee, comprising all the independent non-executive Directors, namely Mr. Chu Kin Wang, Peleus, Mr. Li Zhiqiang and Mr. Zhang Jinhua has been established to advise the Independent Shareholders on the proposed grant of the Refreshed General Mandate. The Independent Financial Adviser was appointed to advise the Independent Board Committee and the Independent Shareholders in respect of the proposed grant of the Refreshed General Mandate.

Whether or not you are able to attend the meeting, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the Hong Kong branch share registrar and transfer office of the Company, Tricor Investor Services 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 shall not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

RECOMMENDATION

Your attention is drawn to (i) the letter from the Independent Board Committee set out on page 13 of this circular which contains its recommendation to the Independent Shareholders on the proposed grant of the Refreshed General Mandate; and (ii) the letter of advice from the Independent Financial Adviser set out on pages 14 to 25 of this circular which contains its advice to the Independent Board Committee and the Independent Shareholders in relation to the proposed grant of the Refreshed General Mandate and the principal factors considered by it in arriving at its advice.

The Directors (including the independent non-executive Directors) consider that the grant of the Refreshed General Mandate is fair and reasonable and is in the interests of the Company and the Shareholders as a whole. The Directors (including the independent non-executive Directors) recommend the Independent Shareholders to vote in favour of the resolution to approve the grant of the Refreshed General Mandate to be proposed at the EGM.

– 11 –

LETTER FROM THE BOARD

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.

By Order of the Board China First Capital Group Limited Wilson Sea

Chairman and Executive Director

– 12 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

CHINA FIRST CAPITAL GROUP LIMITED 中國首控集團有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1269)

18 March 2016

To the Independent Shareholders

Dear Sir or Madam,

REFRESHMENT OF GENERAL MANDATE

We have been appointed as the Independent Board Committee to advise the Independent Shareholders in connection with the proposed grant of the Refreshed General Mandate, details of which are set out in the circular of the Company dated 18 March 2016 (“Circular”), of which this letter forms part. Terms defined in the Circular shall have the same meanings when used herein unless the context otherwise requires.

We wish to draw your attention to the letter from the Board set out on pages 4 to 12 of the Circular and the letter from the Independent Financial Adviser containing its advice to us and the Independent Shareholders regarding the proposed grant of the Refreshed General Mandate set out on pages 14 to 25 of the Circular.

Having considered the reasons for the Refreshed General Mandate as disclosed in the letter from the Board and the principal factors, reasons and advice of Independent Financial Adviser in relation thereto as set out in its letter to the Independent Board Committee and the Independent Shareholders, we are of the view that the grant of the Refreshed General Mandate is fair and reasonable so far as the Independent Shareholders are concerned and that the grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole.

Accordingly, we recommend the Independent Shareholders to vote in favour of the resolution to be proposed at the EGM to approve the grant of the Refreshed General Mandate.

Yours faithfully,

For and on behalf of the Independent Board Committee Mr. Chu Kin Wang, Peleus Mr. Li Zhiqiang Mr. Zhang Jinhua Independent Independent Independent non-executive Director non-executive Director non-executive Director

– 13 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

==> picture [230 x 113] intentionally omitted <==

Room 2704, 27/F, Tower 1, Admiralty Centre, 18 Harcourt Road, Admiralty, Hong Kong

18 March 2016

• To the Independent Board Committee and the Independent Shareholders of China First Capital Group Limited

Dear Sirs,

REFRESHMENT OF GENERAL MANDATE

INTRODUCTION

We refer to our engagement as the independent financial adviser to make recommendations to the independent board committee (the “ Independent Board Committee ”) and the independent shareholders (the “ Independent Shareholders ”) of China First Capital Group Limited (the “ Company ”) in relation to the proposed grant of the Refreshed General Mandate, details of which were disclosed in the announcement of the Company dated 25 February 2016 (the “ Announcement ”) and in the letter from the Board (the “ Letter from the Board ”) set out on page 4 to page 12 of the circular of the Company dated 18 March 2016 (the “ Circular ”) to its shareholders (the “ Shareholders ”), of which this letter forms part. Terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

The EGM will be held to consider, and if thought fit, pass the ordinary resolution to approve the proposed grant of the Refreshed General Mandate. As the grant of the Refreshed General Mandate is to be proposed to the Shareholders before the Company’s next annual general meeting, pursuant to the Listing Rules, this proposal is subject to the Independent Shareholders’ approval by way of poll at the EGM. According to Rule 13.36(4) of the Listing Rules, any controlling Shareholders and their associates or, where there are no controlling Shareholders, the Directors (excluding independent non-executive Directors) and the chief executive of the Company and their respective associates shall abstain from voting in favour of the resolution to approve the proposed grant of the Refreshed General Mandate.

– 14 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As at the Latest Practicable Date, to the best knowledge, information and belief of the Directors, the Company had no controlling Shareholders. As at the Latest Practicable Date, (i) Mr. Wilson Sea indirectly held 102,104,000 Shares, representing approximately 18.46% of the total issued share capital of the Company; (ii) Mr. Wang Wenbo directly held 1,200,000 Shares, representing approximately 0.22% of the total issued share capital of the Company; and (iii) Ms. Yang Weixia directly held 960,000 Shares, representing approximately 0.17% of the total issued share capital of the Company. As at the Latest Practicable Date, Mr. Zhao Zhijun and Mr. Yan Haiting did not hold any Share. As a result, Mr. Wilson Sea, Mr. Wang Wenbo and Ms. Yang Weixia, being executive Directors, together with their respective associates, are required to abstain from voting in favour of the ordinary resolution to approve the grant of the Refreshed General Mandate at the EGM. If any Share is held by any Directors (excluding independent non-executive Directors) on the date of the EGM, such Director together with his/her respective associates are required to abstain from voting in favour of the ordinary resolution to approve the grant of the Refreshed General Mandate at the EGM.

The Independent Board Committee, comprising all the independent non-executive Directors, namely Mr. Chu Kin Wang, Peleus, Mr. Li Zhiqiang and Mr. Zhang Jinhua, has been formed to advise the Independent Shareholders as to whether or not the proposed grant of the Refreshed General Mandate is fair and reasonable, and in the interests of the Company and the Shareholders as a whole, and to make recommendations to the Independent Shareholders in respect thereof. We, Astrum Capital Management Limited, have been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

BASIS OF OUR OPINION

In formulating our opinion and recommendations, we have reviewed, inter alia , (i) the Announcement; (ii) the Circular; (iii) the announcements of the Company dated 5 October 2015 and 26 October 2015 (the “ First Placing Announcements ”) in relation to the placing of 76,800,000 new Shares (the “ First Placing ”) under the general mandate granted to the Directors at the 2015 AGM (the “ AGM General Mandate ”); (iv) the announcements of the Company dated 10 December 2015 and 23 December 2015 (the “ Second Placing Announcements ”) in relation to the placing of 92,160,000 new Shares (the “ Second Placing ”) under the Existing General Mandate; (v) the announcements of the Company dated 29 December 2015 and 27 January 2016 (the “ JV Announcements ”) in relation to the formation of a joint venture company; and (vi) the annual report of the Company for the financial year ended 31 December 2014 (the “ 2014 Annual Report ”) and the interim report of the Company for the six months ended 30 June 2015 (the “ 2015 Interim Report ”). We have also reviewed certain information provided by the management of the Company (the “ Management ”) relating to the operations, financial condition and prospects of the Group. We have also (i) considered such other information, analysis and market data which we deemed relevant; and (ii) conducted verbal discussions with the Management regarding the proposed grant of the Refreshed General Mandate, the businesses and future outlook of the Group. We have assumed that such information and statements, and any representation made to us, are true, accurate and complete in all material respects as of the date hereof and we have relied upon them in formulating our opinion.

– 15 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

All Directors collectively and individually accept full responsibility in providing information of the Company in the Announcement and the Circular and, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in the Announcement and the Circular is accurate and complete in all material respects and not misleading or deceptive, and that there are no other matters not contained in the Announcement and the Circular, the omission of which would make any statement herein or in the Announcement and the Circular misleading. We consider that we have performed all necessary steps to enable us to reach an informed view regarding the reasons for the proposed grant of the Refreshed General Mandate and to justify our reliance on the information provided so as to provide a reasonable basis of our opinion. We have no reasons to suspect that any material information has been withheld by the Directors or the Management, or is misleading, untrue or inaccurate. We have not, however, for the purpose of this exercise, conducted any independent detailed investigation or audit into the businesses or affairs or future prospects of the Group. Our opinion is necessarily based on financial, economic, market and other conditions in effect, and the information made available to us, as at the Latest Practicable Date. This letter is issued to provide information for the Independent Board Committee and the Independent Shareholders solely in connection with their consideration of the proposed grant of the Refreshed General Mandate. Except for the inclusion in the Circular, this letter should not be quoted or referred to, in whole or in part, nor shall it be used for any other purposes, without our prior written consent.

INDEPENDENCE DECLARATION

As at the Latest Practicable Date, Astrum Capital Management Limited did not have any relationships or interests with the Company that could reasonably be regarded as relevant to the independence of Astrum Capital Management Limited. In the last two years, except for the independent financial adviser engagement (in relation to the refreshment of the AGM General Mandate, details of which were set out in the circular of the Company dated 20 November 2015), there was no other engagement between the Group and Astrum Capital Management Limited. Accordingly, we do not consider the past and existing engagements give rise to any conflict for Astrum Capital Management Limited acting as the independent financial adviser in relation to the proposed grant of the Refreshed General Mandate. Apart from normal professional fees paid or payable to us in connection with this appointment as the independent financial adviser, no arrangement exists whereby we will receive any fees or benefits from the Company.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion in respect of the proposed grant of the Refreshed General Mandate, we have considered the following principal factors and reasons:

1. Background of and reasons for the proposed grant of the Refreshed General Mandate

The Company is an investment holding company. The Group is principally engaged in the research and development, design, manufacturing and sale of various automobile shock absorbers and has more than 50 years of experience in the industry. Since the end of 2014, the Group has tapped into new businesses including investment migration advisory services and financial consultancy and advisory services with an aim to diversify the Group’s businesses and further expand its asset portfolio and revenue sources.

– 16 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

At the 2015 EGM, the Shareholders approved the refreshment of the AGM General Mandate which authorised the Directors to issue not more than 92,160,000 Shares, being 20% of the issued share capital of the Company of 460,800,000 Shares as at the date of the 2015 EGM (i.e. the Existing General Mandate), details of which were disclosed in the poll results announcement of the Company dated 8 December 2015 and the circular of the Company dated 20 November 2015. The Existing General Mandate was subsequently fully utilised by the Company on 23 December 2015 as a result of completion of the Second Placing and no more new Share can be issued under the Existing General Mandate. For further details of the Second Placing, please refer to the Second Placing Announcements.

As disclosed in the Letter from the Board, having considered that (i) the Existing General Mandate has been fully utilised as at the Latest Practicable Date; and (ii) the Refreshed General Mandate will empower the Directors to issue new Shares under the refreshed limit speedily and provide the Company with the flexibility and ability to capture any appropriate capital raising or business opportunities, which may arise, the Directors consider that the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole.

We have enquired with the Management and were advised that the next annual general meeting of the Company is expected to be held in or about June 2016, which is about 3 months away from the Latest Practicable Date. In accordance with the Listing Rules, should the Company wish to issue new Shares or any equity-linked securities before the grant of a new general mandate in the next annual general meeting of the Company, the Company should make an announcement, issue a circular and seek the Shareholders’ approval in an extraordinary general meeting, which we consider to be a lengthy process and may therefore hinder the progress of any potential funding raising exercise or investment or acquisition plan. We are of the view that in the absence of the Refreshed General Mandate, the Company lacks the flexibility to issue new Shares or other equity-linked securities in a timely manner.

In addition, we have discussed with the Management regarding the Group’s business and development plan and were given to understand that the Group will continue to diversify and develop new businesses with a view to enhancing its income stream. In 2015, the Group has tapped into the areas of consulting services for investment immigration and financial investment (the “ New Businesses ”) through the following acquisitions and formation of a joint venture company:

• (i) On 16 April 2015, the Group entered into an agreement to acquire 51% equity of 深圳君拓移民諮詢服務有限公司 (Shenzhen Juntour Immigration Consultancy Service Limited) and 65% equity of 深圳冠橋移民諮詢有限公司 (Shenzhen Crown Bridge Immigration Consultancy Limited) from an independent third party, with an aggregate consideration of RMB5.80 million. These two target companies are principally engaged in migration advisory service business. As advised by the Management, the aforementioned acquisitions were completed on 3 June 2015.

– 17 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• (ii) On 29 December 2015, the Group and two independent third parties (collectively, the “ JV Parties ”) entered into a joint venture agreement (as supplemented by the supplemental agreement dated 27 January 2016) (the “ JV Agreement ”) in respect of the formation of a joint venture company (the “ JV Company ”), namely Guolian Financial Holding Group Co., Limited (國聯金 融控股集團有限公司), engaging in investment and financial service business in Hong Kong. Pursuant to the JV Agreement, the Company’s capital contribution for the formation of the JV Company is HK$175 million, which has been paid in March 2016 in cash by funds raised from the Second Placing. The JV Parties further agreed that the JV Parties shall (i) subscribe for further shares; or (ii) use their best efforts to procure loans or facilities be granted to the JV Company and provide guarantees, indemnities and undertakings for such loans and facilities; or (iii) if the foregoing loans and facilities cannot satisfy the requirements of the Joint Venture, provide shareholders’ loan to the JV Company, each in proportion to their shareholding in the JV Company in the event that the financial resources of the JV Company cannot satisfy its working capital requirements.

The Management further advised us that the Group is currently in preliminary discussions with a vendor in relation to the proposed acquisition of certain equity interests in a target company, which is principally engaged in the provision of financial advisory services and investment in private equity funds in the PRC (the “ Potential Acquisition ”). The estimated investment size for the Potential Acquisition amounts to approximately RMB400 million. As at the Latest Practicable Date, no binding terms or agreements have been entered into between the Group and the vendor in respect of the Potential Acquisition and the Potential Acquisition may or may not be materialised. In view of the fact that the New Businesses are still at the initial stage, the Management expects that more time, effort and financial resources are required for the development of the New Businesses, and the Group has been pursuing further investments and/ or acquisitions of business or companies, which may bring synergy and growth to the New Businesses.

In view of the Group’s business and development plan as mentioned above, we have reviewed, and discussed with the Management, the liquidity and cash position of the Group. According to the latest published unaudited financial statements of the Company, as at 30 June 2015, the Group’s current assets and current liabilities amounted to approximately RMB709.9 million and approximately RMB887.2 million, respectively, resulting in a net current liabilities position of approximately RMB177.3 million. The Group’s bank balances and cash as at 30 June 2015 was approximately RMB32.8 million and short-term bank borrowings due within one year was approximately RMB386.4 million. In order to strengthen the Group’s financial position, the Group has conducted two equity fund raising exercises (i.e. the First Placing and the Second Placing) in the second half of 2015 and raised an aggregate net proceeds of approximately HK$333.6 million. According to the Letter from the Board, the majority part of proceeds raised from the First Placing and the Second Placing have been utilised as intended, while the remaining unutilised proceeds from the First Placing and the Second Placing of approximately HK$38.8 million will be

– 18 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

used as intended. Please refer to the paragraph headed “ 2. Equity fund raising activities of the Group in the past twelve months ” below for further details of the First Placing and the Second Placing.

Taking into account (i) the Group’s business and development plan as detailed above; (ii) the Group’s unsatisfactory financial position (in particular, the net current liabilities position of approximately RMB177.3 million as at 30 June 2015); and (iii) the ever-changing merger and acquisition market, we consider that it is important for the Group to maintain flexible fund raising availability so as to make prompt decisions and to solicit funding in a relatively short period of time when investment opportunities arise. With the availability of general mandate on hand, the Group will have more options for payment/settlement of the consideration of the investment opportunities (including but not limited to the Potential Acquisition) in a timely and efficient manner such as undergoing equity fund raising exercise in the financial market for cash or settling the consideration by issue of equity or convertible securities to the counterparties. In addition, it is considered the equity financing to be an important avenue of financial resources to the Company since it does not create any interest payment obligations on the Group. As such, we are of the opinion that the Refreshed General Mandate would provide the Company with the necessary flexibility essential for fulfilling any possible funding needs or settlement methods for future business development and/or investment decisions (including but not limited to the Potential Acquisition), and that the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole.

Taking into consideration the facts that (i) the Existing General Mandate has been fully utilised; (ii) it is expected that the next annual general meeting of the Company, in which grant of a new general mandate will be proposed, will be held in or about June 2016, which is about 3 months away from the Latest Practicable Date; (iii) it is the Group’s business strategy to diversify and develop new businesses; and (iv) the Group’s unsatisfactory financial position (in particular, the net current liabilities position of approximately RMB177.3 million) as at 30 June 2015, we concur with the Management that the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole by increasing the financial flexibility necessary for the Group’s future business development and expansion.

– 19 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

2. Equity fund raising activities of the Group in the past twelve months

The following table summarizes the equity fund raising activity of the Company in the past twelve months immediately prior to the Latest Practicable Date:

				Actual use of proceeds
Date of	Fund raising	Estimated net	Proposed use of	as at the Latest
announcement	activity	proceeds	proceeds	Practicable Date
10 December	Placing of	Approximately	Shall be used as general	HK$175.0 million has
2015	92,160,000 new	HK$182.0	working capital of	been used to
	Shares at the	million	the Group and/or for	subscribe for 35%
	placing price of		funding of business	shares in the JV
	HK$2.00 per		or investment	Company as
	placing Share		opportunities if so	disclosed in the JV
	under the		arise	Announcements in
	Existing General			March 2016.
	Mandate

The remaining proceeds which had not been utilised will be used as intended and had been maintained at a bank as at the Latest Practicable Date.

5	October	Placing of	Approximately	(i)	Approximately	(i)	Approximately
	2015	76,800,000 new	HK$151.6		HK$60.4 million		HK$42.9 million
		Shares at the	million		shall be used to		has been used to
		placing price of			finance the		finance the
		HK$2.00 per			development of		development of
		placing Share			investment		investment
		under the AGM			migration advisory		migration advisory
		General Mandate			services and		services and
					financial		financial
					consultancy and		consultancy and
					advisory services		advisory services
					of the Group;		of the Group;
				(ii)	approximately	(ii)	approximately
					HK$50.0 million		HK$53.0 million
					shall be used for		has been used for
					the development of		the development of
					financing and		financing and
					financial credit		financial credit
					business; and		business; and

– 20 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Actual use of proceeds Date of Fund raising Estimated net Proposed use of as at the Latest announcement activity proceeds proceeds Practicable Date (iii) approximately (iii) approximately HK$41.2 million HK$23.9 million shall be used for has been used for general working general working capital of the capital of the Group Group. The remaining proceeds which had not been utilised will be used as intended and had been maintained at a bank as at the Latest Practicable Date.

Save as disclosed above, the Company had not conducted any other equity fund raising activities in the past twelve months immediately preceding the Latest Practicable Date. As mentioned in the Letter from the Board, the Company had not formulated any concrete plan for raising capital by issuing new Shares under the Refreshed General Mandate as at the Latest Practicable Date.

3. Other financing alternatives

Apart from equity financing by issue of new Shares under the Refreshed General Mandate (if granted to the Directors), the Management advised us that the Company will also consider other financing methods (such as debt financing, rights issue and/or open offer) to meet the financial requirements of the Group, as and when appropriate, after taking into account the then financial position, capital structure and cost of funding of the Group as well as the prevailing market condition.

However, debt financing such as bank borrowing may incur interest burden to the Group and may be subject to lengthy due diligence and negotiations. In addition, the ability of the Group to obtain bank borrowing usually depends on the Group’s profitability, financial position and the then prevailing market condition. According to the 2015 Interim Report, the Group recorded an unaudited loss of approximately RMB10.6 million for the six months ended 30 June 2015, and maintained at a net current liabilities position of approximately RMB177.3 million as at 30 June 2015. Given the current unsatisfactory financial performance and position of the Group, we consider that it might be difficult for the Group to obtain bank borrowing at a reasonable interest rate.

– 21 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In respect of rights issue or open offer, it usually involves substantial time and cost to complete as compared to equity financing through issuance of new shares under general mandate, which allows the Company to raise capital within specified number of Shares promptly and when necessary. With reference to the recent fund raising activities by companies listed on the Stock Exchange, in general, (i) rights issues and open offers incurred underwriting commission in the range of around 1.5% to 3.5%; and (ii) the subscription prices were determined at deep discount so as to increase the attractiveness of the equity fund raising exercises. In addition, the success of rights issue and open offer is highly dependent on the then market condition and sentiment. We noted from the announcement of the Company dated 4 May 2015 that the Group intended to raise fund of approximately HK$153.6 million, before expenses, by way of open offer. Subsequently, the open offer lapsed due to, among other things, the volatility in the local stock market.

In view of the above, together with the facts that (i) the proposed grant of the Refreshed General Mandate will provide the Company with an additional financing alternative to capture any capital raising or prospective investment, as and when it arises, in a timely manner; (ii) the equity financing by way of general mandate is less costly and time-consuming than raising fund by way of rights issue or open offer; and (iii) it is reasonable for the Company to maintain its flexibility in the selection of the best financing method for its future business development, we are of the view that the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole.

– 22 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

4. Shareholding dilution effects and cumulative dilution effects of fund raising activities over the past twelve months and potential dilution to shareholding of the Independent Shareholders

As mentioned above, the Group conducted two fund raising activities over the past twelve months immediately prior to the Latest Practicable Date (namely, the First Placing and the Second Placing). According to the First Placing Announcements in relation to the First Placing (being placing of 76,800,000 new Shares under the AGM General Mandate), immediately prior to completion of the First Placing, public Shareholders held 220,970,000 Shares (the “ Initial Public Shareholding ”), representing approximately 57.54% of the then issued share capital of the Company. After completion of the First Placing, the Company announced the Second Placing (being placing of 92,160,000 new Shares under the Existing General Mandate) on 10 December 2015. The table below sets forth (i) the dilution effects of each respective fund raising activity in the past twelve months immediately prior to the Latest Practicable Date; (ii) the potential dilution effects of the Refreshed General Mandate; and (iii) the cumulative dilution effects to the Initial Public Shareholding:

			Dilution
		Initial Public	effects of
		Shareholding	each respective	Cumulative
		(being	fund raising	dilution
		220,970,000	activity to the	effects to the
	Total no. of	Shares) to total	Initial Public	Initial Public
	Shares	no. of Shares	Shareholding	Shareholding
		Approximate %	Approximate %	Approximate %
Immediately prior to
completion of the First
Placing	384,000,000	57.54	N/A	N/A
Immediately after
completion of the First
Placing	460,800,000	47.95	16.67	16.67
Immediately after
completion of the
Second Placing	552,960,000	39.96	16.67	30.56
Immediately after full
utilisation of the
Refreshed General
Mandate	663,552,000	33.30	16.67	42.13

– 23 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following table sets out the shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) upon full utilisation of the Refreshed General Mandate, assuming that no Shares will be issued and/or repurchased during the period commencing from the Latest Practicable Date and up to the date of the EGM:

Shareholders Hongkong Chuang Yue Co., Limited (Note 1) Wealth Max Holdings Limited (Note 2) Mr. Wang Wenbo (Note 3) Ms. Yang Weixia (Note 4) Public Shareholders Shares that may be issued under the Refreshed General Mandate Total	As at the Latest Practicable Date Shares % 129,932,000 23.50 102,104,000 18.46 1,200,000 0.22 960,000 0.17 318,764,000 57.65 – – 552,960,000 100.00	Upon full utilisation of the Refreshed General Mandate Shares % 129,932,000 19.58 102,104,000 15.39 1,200,000 0.18 960,000 0.14 318,764,000 48.04 110,592,000 16.67 663,552,000 100.00	Upon full utilisation of the Refreshed General Mandate Shares % 129,932,000 19.58 102,104,000 15.39 1,200,000 0.18 960,000 0.14 318,764,000 48.04 110,592,000 16.67 663,552,000 100.00
			100.00

Notes:

1. Hongkong Chuang Yue Co., Limited is owned as to 90% by Shenmane.D Co., Limited, which in turn is wholly owned by Golden Cloud Co., Limited, and which in turn is wholly owned by Mr. Tang Mingyang.

2. Wealth Max Holdings Limited is wholly owned by Mr. Wilson Sea, the chairman of the Company and an executive Director.

3. Mr. Wang Wenbo is an executive Director.

4. Ms. Yang Weixia is an executive Director.

As illustrated in the table above, assuming no Shares will be issued and/or repurchased by the Company during the period commencing from the Latest Practicable Date and up to the date of the EGM, 110,592,000 new Shares can be issued upon full utilisation of the Refreshed General Mandate, representing 20% of the entire issued share capital of the Company as at the date of the EGM. The aggregate shareholding of the existing public Shareholders will decrease from approximately 57.65% as at the Latest Practicable Date to approximately 48.04% upon full utilisation of the Refreshed General Mandate (assuming that none of the new Shares to be issued under the Refreshed General Mandate will be issued to any of the existing Shareholders). The potential maximum dilution effect to the existing public Shareholders arising from the issue of new Shares under the Refreshed General Mandate will be approximately 16.67%.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Taking into account that (i) the Refreshed General Mandate will (a) provide an alternative to the Group to increase the amount of capital which may be raised under the Refreshed General Mandate; (b) provide more flexibility and options of financing to the Group for future business development as well as for other potential future investments as and when such opportunities arise; (c) enable the Company to respond in a timely and effective manner to take advantages of any business opportunities for the benefits of the Company and the Shareholders as a whole; and (d) broaden shareholders’ base; (ii) the majority part of proceeds raised from the First Placing and the Second Placing have been utilised as intended while the remaining unutilised proceeds from the First Placing and the Second Placing of approximately HK$38.8 million will be used as intended; (iii) the shareholding interests of all Shareholders will be decreased in proportion to their respective shareholdings upon any utilisation of the Refreshed General Mandate assuming that none of the new Shares to be issued under the Refreshed General Mandate will be issued to any of the existing Shareholders; and (iv) the dilution effect of the Refreshed General Mandate to shareholding of the existing Shareholders is the same as that of the AGM General Mandate and the Existing General Mandate, we are of the opinion that the potential dilution of the shareholding of the existing public Shareholders is justifiable.

RECOMMENDATION

Having taken into account the principal factors and reasons as mentioned above, we are of the opinion that the proposed grant of the Refreshed General Mandate is fair and reasonable so far as the Company and the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole. Accordingly, we advise the Independent Shareholders, and recommend the Independent Board Committee to advise the Independent Shareholders, to vote in favour of the ordinary resolution approving the proposed grant of the Refreshed General Mandate to be proposed at the EGM.

Yours faithfully, For and on behalf of Astrum Capital Management Limited Hidulf Kwan Rebecca Mak Managing Director Director

Note: Mr. Hidulf Kwan has been a responsible officer of Type 6 (advising on corporate finance) regulated activity under SFO since 2006 and has participated in and completed various independent financial advisory transactions.

Ms. Rebecca Mak has been a responsible officer of Type 6 (advising on corporate finance) regulated activity under SFO since 2012 and has participated in and completed various independent financial advisory transactions.

– 25 –

NOTICE OF EGM

CHINA FIRST CAPITAL GROUP LIMITED 中國首控集團有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1269)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “ Meeting ”) of China First Capital Group Limited (the “ Company ”) will be held at 10:30 a.m., on Thursday, 7 April 2016 at Units 4501–02 & 12–13, 45/F, The Center, 99 Queen’s Road Central, Hong Kong for the purposes of considering and, if thought fit, passing the following resolution:

ORDINARY RESOLUTION

“ THAT

• (a) subject to sub-paragraph (c) of this resolution, pursuant to the Rules (the “ Listing Rules ”) Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”) as amended from time to time, the exercise by the directors of the Company (the “ Directors ”) during the Relevant Period (as defined below) of all the powers of the Company to allot, issue and deal with additional shares of the Company (the “ Shares ”) and to make or grant offers, agreements and options, including warrants to subscribe for shares, which might require the exercise of such powers be and the same is hereby generally and unconditionally approved;

• (b) the approval in sub-paragraph (a) of this resolution shall authorise the Directors during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such powers after the end of the Relevant Period;

• (c) the aggregate number of Shares allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) and issued by the Directors pursuant to the approval in sub-paragraph (a) of this resolution, otherwise than pursuant to (i) a Rights Issue (as defined below); or (ii) any issue of Shares upon the exercise of rights of subscription or conversion under the terms of any warrants issued by the Company or any securities which are convertible into Shares; or (iii) the exercise of any options granted under the share option scheme of the Company; or (iv) any scrip dividend or similar arrangement providing for the allotment and issue of Shares in lieu of the whole or part of the dividend on Shares in accordance with the memorandum and articles of association of the Company (the “ Articles ”) shall not exceed 20% of the issued share capital of the Company as at the date of the passing of this resolution and the said approval shall be limited accordingly; and

– EGM-1 –

NOTICE OF EGM

• (d) for the purposes of this resolution:

“ Relevant Period ” means the period from the date of the passing of this resolution until whichever is the earliest of:

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Articles or any applicable laws and regulations of the Cayman Islands to be held; or

• (iii) the date on which the authority set out in this resolution is revoked or varied by the passing of an ordinary resolution of the shareholders of the Company (the “ Shareholders ”) in general meeting.

“ Rights Issue ” means an offer of Shares, or offer or issue of warrants, options or other securities of the Company giving rights to subscribe for Shares, open for a period fixed by the Directors to holders of Shares or any class thereof on the register on a fixed record date in proportion to their then holdings of such Shares or class thereof (subject to such exclusion or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any territory applicable to the Company).”

By Order of the Board of China First Capital Group Limited Wilson Sea Chairman and Executive Director

Hong Kong, 18 March 2016

Notes:

• (1) Any Shareholder entitled to attend and vote at the Meeting is entitled to appoint another person as his proxy to attend and vote instead of him. A Shareholder who is the holder of two or more Shares may appoint more than one proxy to attend on the same occasion. A proxy need not be a Shareholder.

• (2) In order to be valid, a form of proxy and the power of attorney (if any) or other authority (if any) under which it is signed, or a certified copy of such power or authority, must be deposited at the Hong Kong branch share registrar and transfer office of the Company, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time fixed for holding the meeting or any adjournment thereof.

• (3) Delivery of the form of proxy will not preclude a Shareholder from attending and voting in person at the meeting convened and in such event, the form of proxy shall be deemed to be revoked.

• (4) In the case of joint registered holders of any Share, any one of such joint registered holders may vote at the meeting, 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 registered holders be present at the meeting, the vote of the senior who tenders a vote either personally or by proxy shall be accepted to the exclusion of the votes of the other joint registered holders and, for this purpose, seniority shall be determined by the order in which the names stand in the register in respect of the joint holding.

• (5) As at the date of this notice, the Company’s executive Directors are Mr. Wilson Sea, Mr. Zhao Zhijun, Mr. Yan Haiting, Mr. Wang Wenbo and Ms. Yang Weixia, and the Company’s independent non-executive Directors are Mr. Chu Kin Wang, Peleus, Mr. Li Zhiqiang and Mr. Zhang Jinhua.

– EGM-2 –