GoFintech Quantum Innovation Limited — Proxy Solicitation & Information Statement 2003

Aug 6, 2003

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in New Times Group Holdings Limited, you should at once hand this circular to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

NEW TIMES GROUP HOLDINGS LIMITED （新時代集團控股有限公司）[*]

(Incorporated in Bermuda with limited liability)

DISCLOSEABLE TRANSACTION

6 August 2003

* For identification purpose only

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
The Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Information on Elegant Pool . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Reason for the Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Appendix – General Information
Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Directors’ Interests in Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Substantial Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Service Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10

DEFINITIONS

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

“Acquisition”	the acquisition of the Sale Shares and the Sale Loan by the
	Purchaser under the Agreement
“Agreement”	a conditional agreement dated 14 July 2003 entered into
	between the Vendor and the Purchaser in respect of the
	Acquisition
“associate(s)”	has the meaning ascribed to it under the Listing Rules
“Beijing Properties”	Shop spaces within Axes 1-10, 10-15, 16-22 and 28-32 on
	1st Level and Shop spaces within Axes 1-10, 10-15, 16-22
	and 28-32 on 2nd Level, Buildings Nos.1, 2 and 3, Wan Di
	Ming Yuan, No.39 Xi Si Huan Zhong Road, Hai Din District,
	Beijing, Hebei Province, PRC, which are of a total gross
	floor area of approximately 4,550.94 square meters and are
	all occupied and subject to the Beijing Tenancy Agreements
“Beijing Properties Agreement”	the contract which has been signed by Elegant Pool on
	30 April 2003 for acquiring the Beijing Properties
“Beijing Tenancy Agreements”	four tenancy agreements which all the Beijing Properties
	are and will be subject to upon Completion
“Board”	the board of Directors
“Business Day”	a day (other than Saturdays and days on which a tropic
	cyclone warning No. 8 or above or a rainstorm warning
	signal is hoisted in Hong Kong at any time between
	9:00 a.m. and 5:00 p.m.) on which banks in Hong Kong are
	generally open for the transaction of normal banking
	business
“Company”	New Times Group Holdings Limited, a company
	incorporated in Bermuda with limited liability, the shares
	of which are listed on the Stock Exchange
“Completion”	completion of the Agreement
“Completion Date”	the date of Completion, which is expected to be on or before
	6 February 2004
“Consideration”	the total sum of HK$70,000,000
“Directors”	the directors, including independent non-executive directors,
	of the Company

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DEFINITIONS

“Elegant Pool”	Elegant Pool Limited, a company incorporated in the British
	Virgin Islands with limited liability and is beneficially and
	wholly owned by the Vendor
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of PRC
“Latest Practicable Date”	1 August 2003, being the latest practicable date prior to the
	printing of this circular for ascertaining certain information
	in this circular
“Listing Rules”	The Rules Governing the Listing of Securities on the Stock
	Exchange
“PRC”	the People’s Republic of China
“Purchaser” or “Powerful Union”	Powerful Union Limited, a company incorporated in the
	British Virgin Islands with limited liability, which is an
	indirect wholly owned subsidiary of the Company
“Sale Loan”	all the shareholder loan and monies owing from Elegant
	Pool to the Vendor as at the Completion Date and to be
	assigned by the Vendor to the Purchaser pursuant to the
	Agreement
“Sale Shares”	100 shares of US$1 each in the issued share capital of
	Elegant Pool, which are beneficially owned by the Vendor
	and to be purchased by the Purchaser
“SFO”	Securities and Futures Ordinance, Chapter 571 of the laws
	of Hong Kong
“Share(s)”	share(s) of HK$0.10 each in the capital of the Company
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Vendor” or “Mr. Woo”	Mr. Woo Chun Kei, Jackie
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“RMB”	Renminbi, the lawful currency of the PRC
“%”	per cent.

Conversion of RMB into HK$ is based on the exchange rate of RMB1.06 = HK$1.00.

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LETTER FROM THE BOARD

NEW TIMES GROUP HOLDINGS LIMITED （新時代集團控股有限公司）[*]

(Incorporated in Bermuda with limited liability)

Executive Directors: Cheong Tin Yau (Chairman) Liu Jicheng (Deputy Chairman) Lam Kwan Sing

Independent Non-executive Directors: Lau Ching Yin, Judy Lo Kwok Hung, John

Registered Office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Head office and principal place of business:

22nd Floor

80 Gloucester Road Wanchai Hong Kong

6 August 2003

To the Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION

INTRODUCTION

The Company announced on 16 July 2003 that its indirect wholly owned subsidiary, Powerful Union, has entered into an agreement on 14 July 2003 with the Vendor for the acquisition of the entire issued share capital of Elegant Pool and the Sale Loan at a total consideration of HK$70,000,000.

The Acquisition constitutes a discloseable transaction of the Company under the Listing Rules. The purpose of this circular is to provide the Shareholders with further information of the Acquisition.

THE AGREEMENT

Date

14 July 2003

Parties

Vendor : Mr. Woo, who is independent of and not connected with the Directors, chief executive or substantial shareholders of the Company or its subsidiaries or any of their respective associates as defined under the Listing Rule. Save for the entering into the Agreement, Mr. Woo has no business relationship or other relationship with the Company, the Directors or their associates.

* For identification purpose only

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LETTER FROM THE BOARD

Purchaser : Powerful Union

Assets to be acquired

Under the Agreement, the Purchaser agreed to purchase and the Vendor agreed to sell:

• (1) 100 shares of US$1 each in the issued capital of Elegant Pool, representing the entire issued share capital of Elegant Pool, at a consideration of HK$8,671,026; and

• (2) all the shareholder loan and monies owing from Elegant Pool to the Vendor as at the Completion Date at a consideration of HK$61,328,974.

As at the date of the Agreement, the Sale Loan was in the aggregate principal sum of HK$61,328,974.72.

Total Consideration

The total consideration of the Acquisition is HK$70,000,000, as to HK$8,671,026 being consideration for the Sale Shares and as to the balance of HK$61,328,974 being consideration for the Sale Loan.

The Consideration is to be satisfied by the Purchaser in cash in the following manner and by way of cheques or by other payment method as the Vendor and the Purchaser may agree:

• (1) HK$10,000,000 of the Consideration shall be paid by the Purchaser to the Vendor upon signing of the Agreement; and

• (2) balance of the Consideration in the sum of HK$60,000,000 shall be paid by the Purchaser to the Vendor upon Completion.

The said sum of HK$10,000,000 referred to in paragraph (1) above has been paid by the Purchaser to the Vendor on 14 July 2003, the date of signing of the Agreement.

The Consideration was determined by the parties after arm’s length negotiations by reference to the market value of the Beijing Properties indicated in a valuation report issued by Chung, Chan & Associates, Chartered Surveyors, a professional valuer appointed by the Purchaser, who is not connected person as defined under the Listing Rules and has relevant experience in valuation for property in the PRC, at about RMB80 million (equivalent to approximately HK$75.5 million) as at 8 July 2003 with reference to market comparables as well as by capitalization of the net income from the Beijing Tenancy Agreements for the tenancy periods, which is the methodology adopted in valuation when a property is subject to tenancy agreement, and with allowance given for outgoings and where appropriate with provisions made for reversionary income potential (being an assumption adopted for assessing a higher rental income received after the expiry of the existing tenancy under normal market conditions) and the amount of the Sale Loan to be assigned to the Purchaser.

The Consideration will be funded by internal resources of the Company, which includes all proceeds from the rights issue of the Company as referred to in the Company’s announcement dated 7 May 2003.

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LETTER FROM THE BOARD

Conditions

Completion is conditional on the following conditions:

• (a) the Purchaser having completed its due diligence (including without limitation, legal, financial and commercial aspects) in respect of Elegant Pool and (if any) all members of Elegant Pool group of companies and the results of which are, in the absolute opinion of the Purchaser, satisfactory and acceptable to the Purchaser in all respects;

• (b) the Beijing Properties Agreement having been duly registered with the relevant government authorities in the PRC and the real estate ownership certificates of the Beijing Properties having been issued to and in the name of Elegant Pool within 6 months of the signing of the Agreement;

• (c) the Beijing Tenancy Agreements having been varied to such terms and conditions as the Purchaser shall in its sole discretion request and Elegant Pool having signed all the variation or supplemental agreements relating to the Beijing Tenancy Agreements with the respective tenants;

• (d) the Vendor having provided the Purchaser with a certificate of good standing and a certificate of incumbency of Elegant Pool (which form and contents are subject to the prior approval of the Purchaser at its absolute discretion) by a British Virgin Islands law firm (acceptable to the Purchaser);

• (e) all necessary consents, permits and approval (whether governmental, regulatory or otherwise) as may be required for Elegant Pool in respect of the Agreement and the transactions contemplated hereunder having been obtained by the Vendor; and

• (f) all necessary consents, permits and approval (whether governmental, regulatory or otherwise) as may be required in respect of the Agreement and the transactions contemplated hereunder having been obtained by the Purchaser.

The Purchaser may at any time by notice in writing to the Vendor waive any of the above conditions (other than conditions (e) and (f)). However, the Purchaser currently has no intention to do so.

If the conditions set out above are not fulfilled or so waived on or before 5:00 p.m. on 31 January 2004 or such later date as the Purchaser may agree in writing, the Agreement will cease and determine and the parties to the Agreement shall not have any obligations and liabilities thereunder save for any antecedent breaches of the terms of the Agreement and all monies paid by the Purchaser to the Vendor thereunder shall be repaid to the Purchaser in full without any deduction forthwith. In such circumstances, the Company will immediately make an appropriate announcement.

Beijing Tenancy Agreements

The Beijing Properties are subject to the Beijing Tenancy Agreements, being three 5-year tenancy agreements commencing from 15 March 2003, 30 March 2003 and 20 April 2003

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LETTER FROM THE BOARD

respectively, and a 4-year tenancy agreement commencing from 10 April 2003, and the total rent receivable is approximately RMB593,000 (equivalent to approximately HK$559,000) per month. The use of the Beijing Properties under the Beijing Tenancy Agreements is for commercial purpose. The Beijing Tenancy Agreements can be terminated on certain circumstances such as non-payment of rent or subletting by the respective tenants. As such, the rental income is not guaranteed. Upon Completion, the Beijing Properties will continue to be subject to the Beijing Tenancy Agreements.

Completion

Completion will take place on the fifth Business Day after all the conditions set out in the paragraph headed “Conditions” in this circular are satisfied or waived as the case may be, or such other date as the parties may agree.

INFORMATION ON ELEGANT POOL

Elegant Pool is a company incorporated with limited liability in the British Virgin Islands on 7 January 2003. Since its incorporation, it has been engaged solely in acquiring the Beijing Properties by entering into the Beijing Properties Agreement with an independent third party who is not a connected person to the Company as defined under the Listing Rules and settled the related consideration in full. As at the date of this circular, Elegant Pool is applying for the issue of the real estate ownership certificates of the Beijing Properties in its name and it will become the legal and beneficial owner of the Beijing Properties upon completion of all relevant procedures with the PRC authorities. As confirmed by the Company’s PRC legal adviser, the title of Elegant Pool to the Beijing Properties will be evidenced by the issue of the real estate ownership certificates of the Beijing Properties in Elegant Pool’s name.

Based on the unaudited management accounts of Elegant Pool: a) its profit before and after taxation for the period from 7 January 2003 to 31 May 2003 were both approximately HK$551,000 which was derived from the rental income of the Beijing Properties received for the month of May 2003 less operating expenses incurred; and b) its unaudited net asset value as at 31 May 2003 was approximately HK$552,000 calculated as total assets which comprised the cost of the Beijing Properties and the rental receivables minus the total liabilities which comprised the Sale Loan to be acquired and the rental deposit received. There was no extraordinary items for the period from 7 January 2003 to 31 May 2003.

REASON FOR THE ACQUISITION

The Group is principally engaged in the provision of corporate finance and investment advisory services, trading of precision components processing equipment, and investment activities.

The Board considers that the terms of the Agreement are fair and reasonable and in the best interests of the Company. The Board also considers that the Acquisition will give the Group the opportunity to diversify its business in the PRC property market and broaden the earnings base of the Group with a view to maximize the return on the assets of the Group. It is also expected that through the leasing of the Beijing Properties pursuant to the Beijing Tenancy Agreements, the Acquisition will contribute additional operating profit to the Group and hence gives a positive effect on the overall earnings in future. In view of the above and the rental yield of the Beijing

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LETTER FROM THE BOARD

Properties, the Board considers that it is now a suitable time for the Company to engage in the Acquisition. In addition, as a result of the Acquisition, there is no adverse effect on the assets and liabilities of the Company. Elegant Pool will be an indirect wholly owned subsidiary of the Company after Completion. The Board expects that the Company will hold the Beijing Properties through Elegant Pool as a long term investment.

ADDITIONAL INFORMATION

Your attention is drawn to the general information set out in the appendix to this circular.

Yours faithfully, For and on behalf of

New Times Group Holdings Limited Cheong Tin Yau Chairman

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquires, that to the best of their knowledge and belief, there are no other facts concerning the Group the omission of which would make any statement herein misleading.

2. DIRECTORS’ INTERESTS IN SECURITIES

As at the Latest Practicable Date, the interests or short positions of the Directors or chief executives of the Company in the shares, underlying shares and debentures of the Company or any associated corporations (within the meaning of Part XV of the SFO) which require notification to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which any such Director or chief executive is taken or deemed to have under such provisions of the SFO) or which are required, pursuant to Sections 352 of SFO, to be entered in the register maintained by the Company under Section 352 of the SFO or which are required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies contained in the Listing Rules, to be notified to the Company and the Stock Exchange were as follows:

Name of Directors	Nature of interests	Number of Shares
Cheong Tin Yau	Corporate_(Note)_	242,366,000

Note: This corporate interest was held by Kandy Profits Limited, a company wholly owned by Mr. Cheong Tin Yau.

Save as disclosed above, none of the Directors or their associates have, as at the Latest Practicable Date, any interests in the shares, underlying shares and debentures of the Company or any associated corporations (within the meaning of Part XV of the SFO) which require notification to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which any such Director or chief executive is taken or deemed to have under such provisions of the SFO) or which are required, pursuant to Sections 352 of SFO, to be entered in the register maintained by the Company under Section 352 of the SFO or which are required, pursuant to the Model Code for Securities Transaction by Directors of Listed Companies, to be notified to the Company or the Stock Exchange.

3. SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, according to the register kept by the Company pursuant to Section 336 of SFO, and so far as is known to the Directors, the Shareholders, other than a Director or chief executive of the Company, who had an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who were directly or indirectly

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GENERAL INFORMATION

APPENDIX

interested in 10 per cent. or more of the issued share capital of the Company carrying rights to vote in all circumstances at general meetings of the Company together with the number of shares in which they were deemed to be interested were:

Name	Number of Shares	Percentage of holding
Kandy Profits Limited	242,366,000_(Note 1)_	55.9%
Kistefos Investment A.S.	62,400,000_(Note 2)_	14.4%

Note:

1. Details of the interest of these 242,366,000 Shares are set out in the paragraph headed “Directors’ Interests in Securities” of this appendix.

2. Kistefos Investment A.S. is wholly owned by A.S. Kistefos Traesliberi, in which Christen Sveaas has an 85% beneficial interest.

4. SERVICE CONTRACT

As at the Latest Practicable Date, there is no service contract between the Directors and members of the Group which does not expire or is not determinable by the employer within one year without payment of compensation (other than statutory compensation).

5. LITIGATION

On 8 March 2001, Kistefos Investment A.S. (“Kistefos”), a substantial Shareholder, filed a petition (“Petition”) against the Company and a former Director of the Company, in the Supreme Court of Bermuda (“Court”) under Section 111(1) of the Companies Act 1981 of Bermuda. The Petition was based on a claim that certain affairs of the Company had been conducted in a manner which was oppressive or unfairly prejudicial to the interests of certain Shareholders, including Kistefos itself.

In the Petition, Kistefos sought an order from the Court to:–

• (1) compel the Company or the former Director to purchase Kistefo’s shareholding in the Company at a fair value to be determined by the Court; or

• (2) wind up the Company.

The Company and the former Director sought to strike out the Petition. In October 2001, the Court struck out the claim of Kistefos to wind up the Company but refused to strike out the claim of Kistefos for an order compelling the Company or the former Director to repurchase the shareholding of Kistefos. This latter claim remains to be tried in the Court.

In June 2002, following the hearing of an appeal brought by the Company against the decision of October 2001, the Court of Appeal of Bermuda (“Court of Appeal”) confirmed the earlier order of the Court. Accordingly, the claim of Kistefos to wind up the Company remains struck out, but the claim of Kistefos to compel the Company or the former Director to repurchase its shareholding remains to be tried.

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GENERAL INFORMATION

APPENDIX

Following the decision of the Court of Appeal in June 2002, the proceedings were dormant until recently. Kistefos filed a summons dated 7 March 2003 in the Court seeking directions for the future conduct of the litigation. In addition, Kistefos sought in its summons to re-amend the Petition. The application by Kistefos to make the amendments to the Petition was heard by the Court on 27 March 2003. On 28 March 2003, the Company announced that it was informed by its legal adviser in Bermuda that Kistefos did not proceed with the summons for directions at the Court hearing of 27 March 2003 but had instead asked that the existing Petition, as it currently stands, be set down for trial. Consequently, the Petition was not re-amended and the Court ordered that the Petition, as it currently stands, be set down for trial but no date has yet been fixed for any further Court hearing.

The Petition remains at a preliminary stage. The Directors, after considering the advice from the Company’s Bermuda legal advisers, consider that the Company has a reasonably good defence to the original claim by Kistefos that the Company or the former Director should buy out the shareholding of Kistefos in the Company.

With regard to the Group’s contingent liabilities in respect of the litigation brought by Kistefos on the Company and a former Director of the Company, the Directors are of the view that given the ongoing status of the litigation brought by Kistefos, the Group is unable to quantify the amount of contingent liabilities which may arise from the litigation brought by Kistefos.

Save as the aforesaid, as far as the Directors are aware, no member of the Group is engaged in any litigation or arbitration of material importance and the Directors are not aware of any litigation or claims of material importance pending or threatened against any member of the Group.

6. MISCELLANEOUS

• (a) The registered office of the Company is at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda and the principal place of business is at 22nd Floor, 80 Gloucester Road, Wanchai, Hong Kong.

• (b) The branch share registrars is Tengis Limited at G/F, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong.

• (c) The company secretary of the Company is Ms. Yim Lai Wa, ACS, ACIS .

• (d) The English text of this circular shall prevail over the Chinese text for the purpose of interpretation.

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