HC Group Inc. — Capital/Financing Update 2018

Jul 19, 2018

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

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HC GROUP INC. 慧聰集團有限公司

(formerly known as HC International, Inc.)

(incorporated in the Cayman Islands with limited liability) (Stock Code: 02280)

GRANT OF OPTIONS

This announcement is made pursuant to Rule 17.06A of the Rules Governing the Listing of Securities (the “ Listing Rules ”) on The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”).

The board (the “ Board ”) of directors (the “ Director(s) ”) of HC Group Inc. (the “ Company ”, together with its subsidiaries, the “ Group ”) hereby announces that on 19 July 2018 (the “ Date of Grant ”), an aggregate of 36,000,000 share options (the “ Options ”) to subscribe for the ordinary shares of HK$0.10 each in the share capital of the Company (the “ Share(s) ”) were granted to a total of 21 persons (the “ Grantees ”), who are the core management staff and officers of the Group, under the Company’s share option scheme adopted on 22 May 2015 (the “ Share Option Scheme ”), subject to the acceptance of the Grantees.

Details of the Options granted are set out below:

Date of Grant

19 July 2018

Number of the Options

36,000,000

Exercise price of Options granted

Each Option shall entitle the holder of the Option to subscribe for one Share upon exercise of such Option at an exercise price of HK$4.60 per Share, which represents the highest of (1) HK$0.10, the nominal value of a Share; (2) the closing price of HK$4.50 per Share as stated in the daily quotation sheets issued by the Stock Exchange on the Date of Grant; and (3) the average closing price of HK$4.60 per Share as stated in the daily quotation sheets issued by the Stock Exchange for the five business days immediately preceding the Date of Grant.

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Validity period of the Options

10 years, from the Date of Grant up to 18 July 2028, both dates inclusive, subject to the following vesting schedules and conditions.

Vesting periods and vesting conditions of the Options

The Options granted shall be vested and exercisable subject to the following vesting periods and conditions:

		Percentage of Shares
		comprised in the Option
		which is vested and
		exercisable (subject to
		fulfillment of
	Date when the	vesting conditions
	Options become	set out in
	exercisable	the next column)	Condition 1	Condition 2	Condition 3
		(Note)
First tranche of	First anniversary date	33.3%	The revenue of the	The Grantee has achieved	The Grantee shall remain
Options	of the Date of		Company for the year	the performance	as an employee of the
	Grant (the “First		2018 reaches RMB10	targets for the year	Group as at the First
	Anniversary		billion or above.	2018 set out by the	Anniversary Date
	Date”)			department or business
				unit where he/she
				belongs.
Second tranche of	Second anniversary	33.3%	The revenue of the	The Grantee has achieved	The Grantee shall remain
Options	date of the		Company for the year	the performance	as an employee of
	Date of Grant		2019 reaches RMB20	targets for the year	the Group as at the
	(the “Second		billion or above.	2019 set out by the	Second Anniversary
	Anniversary			department or business	Date
	Date”)			unit where he/she
				belongs.
Third tranche of	Third anniversary	33.4%	The revenue of the	The Grantee has achieved	The Grantee shall remain
Options	date of the		Company for the year	the performance	as an employee of the
	Date of Grant		2020 reaches RMB30	targets for the year	Group as at the Third
	(the “Third		billion or above.	2020 set out by the	Anniversary Date
	Anniversary			department or business
	Date”)			unit where he/she
				belongs.

Note:

1. If a Grantee fulfills Condition 1 and Condition 3 set out above in the respective vesting period, the Grantee will be entitled to exercise 40% of the respective tranche of Options;

2. If a Grantee fulfills Condition 2 and Condition 3 set out above in the respective vesting period, the Grantee will be entitled to exercise 40% of the respective tranche of Options;

3. If a Grantee fulfills Condition 3, the Grantee will be entitled to exercise 20% of the respective tranche of Options;

4. All the Options will be automatically cancelled if the Grantee fails to fulfil Condition 3 regardless of whether Condition 1 and/or Condition 2 are achieved.

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1. In addition to the above vesting conditions, if performance targets set out in Condition 1 or Condition 2 above cannot be fully achieved, the number of Options corresponding to fulfilment of Condition 1 and/or Condition 2 as referred to in notes 1 and 2 above which can be exercisable in the respective vesting period will be further adjusted in the following manner:

Percentage of Percentage of performance targets achieved the Options becoming exercisable 100% 100% 70%-99% Proportionate to the percentage of performance targets actually achieved Less than 70% Nil

Of the 36,000,000 Options, 6,200,000 Options were granted to the following Grantees:

		Number of
Name	Capacity	Share Options
Mr. Liu Xiaodong	Executive Director and president	4,000,000
Mr. Lee Wee Ong	Executive Director and chief financial officer	2,200,000

Save as disclosed above, none of the Options were granted to any Director, chief executive or substantial shareholder of the Company or their respective associates (as defined in the Rules Governing the Listing of Securities on the Stock Exchange (the “ Listing Rules ”)).

The grant of Options to each of the above Directors has been approved by the independent non-executive Directors in compliance with Rule 17.04(1) of the Listing Rules.

The grant of Options to any Grantee would not result in the Shares issued and to be issued upon exercise of all Options granted to such person (including exercised and outstanding) in the 12-month period up to and including the Date of Grant representing in aggregate over 1% of the Shares in issue.

By order of the Board HC Group Inc. Liu Jun Chairman and Chief Executive Officer

Beijing, the People’s Republic of China, 19 July 2018

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As at the date of this announcement, the Board comprises:

• Mr. Liu Jun (Executive Director, Chairman and Chief Executive Officer)

• Mr. Lee Wee Ong (Executive Director and Chief Financial Officer)

• Mr. Liu Xiaodong (Executive Director and President)

• Mr. Guo Fansheng (Non-executive Director)

• Mr. Li Jianguang (Non-executive Director)

• Mr. Wong Chi Keung (Non-executive Director)

• Mr. Zhang Ke (Independent non-executive Director)

• Mr. Zhang Tim Tianwei (Independent non-executive Director)

• Ms. Qi Yan (Independent non-executive Director)

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