Colour Life Services Group Co., Limited — Proxy Solicitation & Information Statement 2021

Jun 17, 2021

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, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Colour Life Services Group Co., Limited, you should at once hand this circular to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for onward 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.

COLOUR LIFE SERVICES GROUP CO., LIMITED �����������

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1778)

SCRIP DIVIDEND SCHEME

IN RELATION TO THE FINAL DIVIDEND FOR THE YEAR ENDED 31 DECEMBER 2020

18 June 2021

CONTENTS

	Page
Summary timetable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4

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SUMMARY TIMETABLE

• Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 June 2021 Latest time for submission of election forms . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:30 p.m. on 6 July 2021

• Expected date for the dispatch of cheques for cash dividend and share certificate for the Scrip Dividend Shares . . . . . . . . . . . . . . . . . . . . . . 21 July 2021

• Expected commencement date of dealing of the Scrip Dividend Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 July 2021

Notes:

1. All references to times are Hong Kong time.

2. If a tropical cyclone warning signal number 8 or above, or ‘‘extreme conditions’’ caused by a super typhoon, or a ‘‘black’’ rainstorm warning signal is/are in force in Hong Kong at any time prior to 4:30 p.m. on 6 July 2021, the latest time for submission of election forms will be extended. Further information is set out in the ‘‘Letter from the Board’’.

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DEFINITIONS

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

• ‘‘Articles’’

• the articles of association of the Company (as amended from time to time);

• ‘‘associate’’

has the meaning ascribed to it under the Listing Rules;

• ‘‘Board’’ the board of Directors;

• ‘‘Company’’

Colour Life Services Group Co., Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange;

• ‘‘Companies Law’’

the Companies Law, Cap. 22 (Law 3 of 1961, as consolidated and revised) of the Cayman Islands;

• ‘‘controlling shareholder’’

has the meaning ascribed to it under the Listing Rules;

• ‘‘Director(s)’’

• the director(s) of the Company;

• ‘‘Eligible Shareholder’’

Shareholders whose names appeared on the register of members of the Company on the Record Date;

• ‘‘Fantasia Holdings’’

Fantasia Holdings Group Co., Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 1777), the controlling shareholder of the Company;

• ‘‘Final Dividend’’

the final dividend of HK10.38 cents per Share for the year ended 31 December 2020 with a scrip alternative payable on or about 21 July 2021 to the Shareholders whose names appeared on the register of members of the Company on 8 June 2021;

• ‘‘HK$’’

Hong Kong dollar(s), the lawful currency of Hong Kong;

• ‘‘Hong Kong"

the Hong Kong Special Administrative Region of the PRC;

• ‘‘Listing Rules’’

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

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DEFINITIONS

‘‘Overseas Shareholders’’ Shareholder(s) whose name(s) appear(s) on the register of members of the Company at the close of business at 4:30 p.m. on the Record Date and whose address(es) as shown on such register is(are) outside Hong Kong; ‘‘PRC’’ the People’s Republic of China; ‘‘Record Date’’ 8 June 2021, being the date for determining the entitlement in Scrip Dividend Shares; ‘‘RMB’’ Renminbi, the lawful currency of the PRC; ‘‘Scrip Dividend Scheme’’ the scheme proposed by the Directors on 25 March 2021 in relation to the Final Dividend which offer the Eligible Shareholders an alternative to elect to receive such dividend wholly or in part by the allotment of new Shares credited as fully paid in lieu of cash; ‘‘Scrip Dividend Shares’’ new Shares to be issued under the Scrip Dividend Scheme; ‘‘Share(s)’’ ordinary share(s) in the share capital of the Company; ‘‘Shareholder(s)’’ holder(s) of the Share(s); ‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited; and ‘‘%’’ per cent.

Should there be any discrepancy between English and Chinese versions of this circular, the English version shall prevail.

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LETTER FROM THE BOARD

COLOUR LIFE SERVICES GROUP CO., LIMITED �����������

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1778)

Executive Directors:

Mr. Pan Jun (Chairman and Acting Chief Executive Officer) Mr. Chen Xinyu Mr. Zhu Guogang

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

Non-executive Directors:

Mr. Wu Qingbin (Vice Chairman) Mr. Zheng Hongyan Ms. Sun Dongni

Independent Non-executive Directors: Mr. Tam Chun Hung, Anthony Mr. Xu Xinmin Mr. Zhu Wuxiang

Headquarters and principal place of business in the PRC:

10/F, Tower B, the Platinum Tower No. 1 Tairan 7th Road Futian District Shenzhen, the PRC

Principal Place of Business in

Hong Kong:

Room 1202-03, New World Tower 1 16-18 Queen’s Road Central Hong Kong

18 June 2021

To the Shareholders

Dear Sir/Madam,

SCRIP DIVIDEND SCHEME IN RELATION TO THE FINAL DIVIDEND FOR THE YEAR ENDED 31 DECEMBER 2020

INTRODUCTION

On 25 March 2021, the Board announced and recommended the payment of the Final Dividend to the Shareholders whose names appeared on the register of members of the Company on 8 June 2021. It was also announced that the Eligible Shareholders could elect to receive the Final Dividend in the form of Scrip Dividend Shares in lieu of cash. At the annual general meeting of the Company held on 28 May 2021, the declaration of the Final Dividend was approved by the Shareholders.

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LETTER FROM THE BOARD

The purpose of this circular is to set out the procedures and conditions which apply in relation to the Scrip Dividend Scheme and the action which should be taken by the Eligible Shareholders if they wish to participate in the Scrip Dividend Scheme.

PARTICULARS OF THE SCRIP DIVIDEND SCHEME

Eligible Shareholders may receive the Final Dividend in one of the following ways:

• (a) wholly in cash at HK10.38 cents (equivalent to RMB8.73 cents) per Share; or

• (b) wholly by way of an allotment of the Scrip Dividend Shares credited as fully paid and having an aggregate market value (as described below) equal to the total amount of the Final Dividend, save for any adjustment for fractions; or

• (c) partly in cash and partly in the form of Scrip Dividend Shares.

The Scrip Dividend Shares will be allotted by way of capitalisation of profits to the Eligible Shareholders electing to receive new Shares in lieu of cash dividend and will rank pari passu in all respects with the existing issued Shares, and will rank in full for all future dividends and distribution which may be declared, made or paid after the date of issue thereof. The Scrip Dividend Shares, when allotted, are not renounceable. No new class of Shares will be issued under the Scrip Dividend Scheme.

BASIS OF ALLOTMENT OF THE SCRIP DIVIDEND SHARES

For the purpose of calculating the number of Scrip Dividend Shares to be allotted, the market value of the Scrip Dividend Shares has been set at HK$3.29 per Share, which is equivalent to the average of the closing prices of the Shares (the ‘‘Average Closing Price’’) on the Stock Exchange for the five consecutive trading days from 2 June 2021 to 8 June 2021. The number of Scrip Dividend Shares which an Eligible Shareholder will be entitled to in respect of his/her pro-rata entitlement to the number of the existing Shares registered in his/her name as at 8 June 2021 will be calculated as follows:

HK$0.1038 Number of Scrip Number of Shares (Final Dividend) Dividend Shares to = × held on 8 June 2021 HK$3.29 be received (Average Closing Price)

If all Eligible Shareholders elect to receive their Final Dividend entitlements in Scrip Dividend Shares, based on 1,454,867,299 Shares in issue on 8 June 2021 not more than 45,901,284 Scrip Dividend Shares will be issued under the Scrip Dividend Scheme. The number of Scrip Dividend Shares to be received by each Eligible Shareholder pursuant to his/her election

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LETTER FROM THE BOARD

will be rounded down to the nearest whole number of Scrip Dividend Share. No fractional shares will be issued under the Scrip Dividend Scheme. Fractional entitlements to Shares will not be issued but will be aggregated and sold for the benefit of the Company.

The last day on which Eligible Shareholders will be entitled to elect their form of dividend is 6 July 2021. Elections to receive the Scrip Dividend Shares must be submitted to the Company’s branch share registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on 6 July 2021.

The latest time for submission of election forms will not be valid if a tropical cyclone warning signal no. 8 or above, or ‘‘extreme conditions’’ caused by a super typhoon, or a ‘‘black’’ rainstorm warning is:

• a. in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on 6 July 2021. Instead the deadline for the submission of election forms will be 5:00 pm on the same business day;

• b. in force in Hong Kong at any local time between 12:00 noon and 4:30 pm on 6 July 2021. Instead the deadline for the submission of election forms will be rescheduled to 4:30 pm on the next business day which does not have either of those warnings in force at any time between 9:00 am and 4:30 pm.

ADVANTAGES OF THE SCRIP DIVIDEND SCHEME

The Scrip Dividend Scheme will give the Shareholders an opportunity to increase their investment in the Company at market value without incurring brokerage fees, stamp duty and related dealing costs. The Scrip Dividend Scheme will also be to the advantage of the Company because, to the extent that the Shareholders elect to receive the Scrip Dividend Shares, in whole or in part in lieu of a cash dividend, such cash which would otherwise have been paid to the Shareholders will be retained for use as general working capital by the Company.

EFFECT OF THE SCRIP DIVIDEND SCHEME

As at the close of business on 8 June 2021, the number of issued Shares of the Company was 1,454,867,299 Shares, and the Company has 61,608,549 share options outstanding under the share option scheme of the Company. Save for such outstanding share options, the Company has no other warrants, options or other securities convertible into shares of the Company. As the outstanding share options have not been converted into Shares as at the Record Date, only the 1,454,867,299 Shares in issue as at the Record Date are entitled to participate in the Scrip Dividend Scheme. If no elections for the Scrip Dividend Shares are received, the total cash dividend payable by the Company will be approximately HK$151,015,225.64. If all Eligible Shareholders elect to receive their entitlement in Scrip Dividend Shares, not more than 45,901,284 Scrip Dividend Shares will be issued under the Scrip Dividend Scheme, representing approximately 3.16% of the existing issued share capital of the Company and approximately 3.06% of the issued share capital of the Company as enlarged by the issue of Scrip Dividend Shares.

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LETTER FROM THE BOARD

Fantasia Holdings, the controlling shareholder of the Company, and its associates holding in aggregate 982,640,851 Shares, representing approximately 67.54% of the issued share capital of the Company as at the Record Date, has indicated to the Company that they will elect to receive the Final Dividend in Scrip Dividend Shares. Assuming that no other Shareholder would elect to receive the Final Dividend in Scrip Dividend Shares, the shareholding of Fantasia Holding and its associates in the Company would increase to approximately 68.22%. The Company would still be able to meet the public float requirement under Rule 8.08 of the Listing Rules in such a case.

Shareholders should note that the receipt of the Scrip Dividend Shares may give rise to notification obligations under Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). Shareholders who are in any doubt as to how these provisions may affect them are recommended to seek their own professional advice. Shareholders who are in any doubt as to their taxation position are also recommended to seek their own professional advice.

FORM OF ELECTION

A form of election for Eligible Shareholders to elect to receive the Final Dividend in Scrip Dividend Shares is enclosed with this circular.

If you elect to receive your Final Dividend wholly in cash, you do not need to take any action.

If you elect to receive Scrip Dividend Shares, or partly in cash and partly in the form of Scrip Dividend Shares, you should use the enclosed form of election. If you complete the form of election but do not specify the number of Shares in respect of which you wish to receive Scrip Dividend Shares, or if you elect to receive Scrip Dividend Shares in respect of a greater number of Shares than your registered holding on 8 June 2021, you will be deemed to have exercised your election to receive Scrip Dividend Shares in respect of all the Shares of which you were then registered as holder.

Any Shareholder who wishes to elect to receive Scrip Dividend Shares in lieu of cash in respect of the Final Dividend entitlement, either in whole or in part, must complete the enclosed form of election in accordance with the instructions printed thereon and return it to the Company’s branch share registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on 6 July 2021. No acknowledgement of receipt of the form of election will be issued.

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LETTER FROM THE BOARD

OVERSEAS SHAREHOLDERS

None of this circular, the form of election nor the Scrip Dividend Shares will be registered or filed under the securities laws or equivalent legislation of any jurisdiction other than, if applicable, Hong Kong.

The participation in the Scrip Dividend Scheme by Overseas Shareholders may be affected by the laws of their relevant jurisdictions. Receipt of this circular and/or a form of election will not constitute an offer in those jurisdictions in which it would be illegal to make such an offer and, in those circumstances, this circular and/or the form of election will be deemed to have been sent for information only. This circular and the form of election do not constitute or form part of an offer or solicitation of any offer to buy securities of the Company, and the form of election is non-transferable. Accordingly, the Scrip Dividend Scheme will not be made available directly or indirectly, and neither this circular nor any other material or advertisement in connection with the Scrip Dividend Scheme may be distributed or published, in or from any country or jurisdiction except under circumstances that will result in compliance with any applicable rules and regulations of any such country or jurisdiction.

The Company has one Overseas Shareholder in the Cayman Islands and one Overseas Shareholder in the British Virgin Islands in its register of members holding in aggregate 829,405,111 Shares (the ‘‘Registered Overseas Shareholders’’), representing approximately 57.01% of the issued share capital of the Company, on the Record Date. Pursuant to Rule 13.36(2) of the Listing Rules, the Company had made enquiries in the relevant jurisdictions regarding the legal restrictions and requirements of regulatory body or stock exchange of extending the Scrip Dividend Scheme to such Overseas Shareholders. The Directors were advised that there was no legal restriction under the applicable legislations of the jurisdictions of the Registered Overseas Shareholders for them to participate in the Scrip Dividend Scheme.

PRC SOUTHBOUND TRADING INVESTORS

As at the Record Date, 60,401,812 Shares of the Company, representing approximately 4.15% of the total issued Shares of the Company, were held by China Securities Depository and Clearing Corporation Limited (‘‘ChinaClear’’). Pursuant to the Frequently Asked Questions Series 29 issued by the Stock Exchange on 14 November 2014 and updated on 4 November 2016 and 13 July 2018 on the interpretation of the Listing Rules, investors from the PRC who hold shares of the Company through ChinaClear as nominee under Shanghai Connect and Shenzhen Connect (the ‘‘PRC Southbound Trading Investors’’) can participate in the Scrip Dividend Scheme through ChinaClear. ChinaClear will provide nominee services for the PRC Southbound Trading Investors to elect to receive the Scrip Dividend Shares in respect of all or part of his/her holding of shares of the Company in accordance with the relevant laws and regulations.

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LETTER FROM THE BOARD

The PRC Southbound Trading Investors should seek advice from their intermediary (including broker, custodian, nominee or ChinaClear participants) and/or other professional advisers for details of the logistical arrangements as required by ChinaClear, and provide instructions with such intermediary in relation to the election to receive the Scrip Dividend Shares.

Shareholders are reminded that it is the responsibility of any Shareholder wishing to join the Scrip Dividend Scheme to satisfy himself as to full observance of the laws of the relevant territory, including obtaining any governmental or other consents which may be required, complying with any other necessary formality and paying any issue, transfer or other taxes due in respect of such jurisdiction. For the avoidance of doubt, the Scrip Dividend Shares are not being offered to the public and the forms of election are nontransferable. Overseas Shareholders who are in doubt as to their position should consult their own professional advisers without delay.

LISTING AND DEALINGS AND DESPATCH OF SHARE CERTIFICATES

The Scrip Dividend Scheme is conditional upon listing approval being granted by the Stock Exchange in respect of the Scrip Dividend Shares to be issued pursuant thereto. Application will be made to the Stock Exchange for the listing of, and permission to deal in, the Scrip Dividend Shares.

The register of members has been closed from 3 June 2021 to 8 June 2021, both days inclusive, during which period no transfers of Shares were effected. The Record Date of the Scrip Dividend Scheme is 8 June 2021. Deadline for the form of election to be returned is scheduled to be 6 July 2021. It is expected that share certificates with respect to the Scrip Dividend Shares, and cheques for cash entitlements, will be despatched to Shareholders at the risk of those entitled thereto on or about 21 July 2021. Dealings in the Scrip Dividend Shares are expected to commence on the Stock Exchange at 9:00 a.m. on 22 July 2021. Subject to the granting of the listing of, and permission to deal in, the Scrip Dividend Shares issued pursuant to the Scrip Dividend Scheme on the Stock Exchange, such Scrip Dividend Shares will be accepted as eligible securities by Hong Kong Securities Clearing Company Limited for deposit, clearance and settlement in the Central Clearing and Settlement System. Shareholders should seek the advice of their licensed securities dealer or other professional adviser for details of these settlement arrangements and how such arrangements will affect their rights and interests.

The Shares are listed on the Stock Exchange. No Shares of the Company are listed or dealt in on any other stock exchange nor is listing or permission to deal in on any other stock exchange being or proposed to be sought.

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LETTER FROM THE BOARD

CONDITION OF THE SCRIP DIVIDEND SCHEME

The Scrip Dividend Scheme is conditional upon the approval of the Stock Exchange for the listing of, and permission to deal in, the Scrip Dividend Shares. If the condition is not satisfied, Shareholders will receive the Final Dividend wholly in cash. Apart from this condition, there are no other conditions to the Final Dividend.

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.

RECOMMENDATION AND ADVICE

Whether or not it is to your advantage to elect to receive cash or the Scrip Dividend Shares or a combination thereof depends upon your own individual circumstances, and the decision in this regard and all effects and consequences resulting therefrom are your sole responsibility. No financial product advice is given in this circular (or any other material) in relation to the Scrip Dividend Scheme and that nothing in this circular (or any other material) should be taken to constitute a recommendation or opinion that is intended to influence any Shareholders in making a decision to participate in the Scrip Dividend Scheme.

If you are in any doubt as to what to do, you should consult your professional advisers as to whether or not you are permitted to receive the Final Dividend in scrip form or if any government or other consent is required. Shareholders who are trustees are recommended to take professional advice as to whether the choice of the Scrip Dividend Shares is within their powers and as to its effect having regard to the terms of the relevant trust instrument.

By Order of the Board Colour Life Services Group Co., Limited 彩生活服務集團有限公司 Pan Jun

Chairman and Acting Chief Executive Officer

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