IGG Inc — AGM Information 2018

Jul 25, 2018

IMPORTANT

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 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.

If you are in doubt as to any aspect of 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 Oriental Watch Holdings Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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ORIENTAL WATCH HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 398)

PROPOSALS RELATING TO GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES NOTICE OF ANNUAL GENERAL MEETING AND RE-ELECTION OF DIRECTORS

The notice convening the annual general meeting of the Company to be held at Victoria Room, 2nd Floor, Mandarin Oriental Hong Kong, 5 Connaught Road Central, Hong Kong on 29th August, 2018 at 3:00 p.m. is set out on pages 9 to 12 of this circular.

26th July, 2018

LETTER FROM THE BOARD

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ORIENTAL WATCH HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 398)

Directors:

Yeung Ming Biu [(Chairman)] Yeung Him Kit, Dennis [(Deputy Chairman and Managing Director)] Yeung Man Yee, Shirley Lam Hing Lun, Alain Choi Kwok Yum Sun Ping Hsu, Samson Li Sau Hung, Eddy Choi Man Chau, Michael*

Principal Office:

Room 312-8 China Insurance Group Building 141 Des Voeux Road Central Hong Kong

• Independent non-executive directors

26th July, 2018

To the shareholders

Dear Sir or Madam,

PROPOSALS RELATING TO

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES NOTICE OF ANNUAL GENERAL MEETING AND RE-ELECTION OF DIRECTORS

INTRODUCTION

At the annual general meeting of Oriental Watch Holdings Limited (the “Company”) for the year ended 31st March, 2018, resolutions will be proposed to grant to the directors of the Company general mandates to issue and repurchase shares of the Company.

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The purpose of this circular is to give you further details of the abovementioned proposals and notice of the annual general meeting of the Company for the year ended 31st March, 2018 (the “AGM”). In compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”), this circular also contains the explanatory statement and gives all the information reasonably necessary to enable shareholders to make an informed decision on whether to vote for or against the resolution to approve the purchase by the Company of its own shares, together with particulars of the directors proposed to be re-elected at the AGM.

GENERAL MANDATE TO ISSUE SHARES

At the AGM an ordinary resolution will be proposed to grant a general mandate to the directors of the Company to allot, issue and dispose of shares of the Company not exceeding 20 per cent of the share capital of the Company in issue on the date of the resolution to provide flexibility to the Company to raise fund by issue of shares efficiently. On 20th July, 2018 (the “Latest Practicable Date”), being the latest practicable date prior to printing of this circular, there were in issue an aggregate of 570,610,224 shares of HK$0.10 each of the Company (“Shares”) and outstanding options to subscribe for a total of 54,560,000 Shares (the “Outstanding Options”). On the assumption that (i) no Share will be issued or repurchased prior to the AGM, exercise in full of the mandate could result in up to 114,122,044 Shares being issued by the Company; or (ii) the Outstanding Options are fully exercised prior to the AGM, exercise in full of the mandate could result in up to 125,034,044 Shares being issued by the Company. The mandate allows the Company to allot, issue and dispose of shares during the period ending on the earliest of the date of the next annual general meeting, the date by which the next annual general meeting of the Company is required to be held by law or the date upon which such authority is revoked or varied by an ordinary resolution of the shareholders in a general meeting of the Company.

GENERAL MANDATE TO REPURCHASE SHARES

At the AGM, an ordinary resolution will also be proposed that the directors be given a general mandate to exercise all powers of the Company to repurchase issued and fully paid shares of the Company. Under such mandate, the number of shares that the Company may repurchase shall not exceed 10 per cent of the share capital of the Company in issue on the date of the resolution. The Company’s authority is restricted to purchases made on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) in accordance with the Listing Rules. Based on 570,610,224 Shares in issue as at the Latest Practicable Date and on the assumption that (i) no Share will be issued or repurchased prior to the AGM, exercise in full of the mandate could result in up to 57,061,022 Shares being repurchased by the Company; or (ii) the Outstanding Options are fully exercised prior to the AGM, exercise in full of the mandate could result in up to 62,517,022 Shares being repurchased by the Company. The mandate allows the Company to make or agree to make purchases only during the period ending on the earliest of the date of the next annual general

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meeting, the date by which the next annual general meeting of the Company is required to be held by law or the date upon which such authority is revoked or varied by an ordinary resolution of the shareholders in a general meeting of the Company.

The directors have no present intention to repurchase any Shares but consider that the mandate will provide the Company the flexibility to make such repurchase when appropriate and beneficial to the Company. Such repurchases may enhance the net value of the Company and/or earnings per Share. As compared with the financial position of the Company as at 31st March, 2018 (being the date of its latest audited accounts), the directors consider that there would be a material adverse impact on the working capital and on the gearing position of the Company in the event that the proposed purchases were to be carried out in full during the proposed purchase period. No purchase would be made in circumstances that would have a material adverse impact on the working capital or gearing ratio of the Company.

The Company is empowered by its Memorandum of Association and Bye-laws to purchase its shares. Bermuda law provides that the amount of capital repaid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant shares, or funds of the Company that would otherwise be available for dividend or distribution or the proceeds of a new issue of shares made for such purpose. The amount of premium payable on repurchase may only be paid out of either the funds of the Company that would otherwise be available for dividend or distribution or out of the share premium or contributed surplus accounts of the Company.

The directors intend to apply the capital paid up on the relevant Shares or the profit that would otherwise be available for distribution by way of dividend for any purchase of its shares.

Directors, their close associates and core connected persons

None of the directors nor, to the best of the knowledge and belief of the directors having made all reasonable enquiries, any of the close associates (as defined in the Listing Rules) of any of the directors has any present intention, in the event that the proposal is approved by shareholders, to sell Shares to the Company.

No core connected person of the Company (as defined in the Listing Rules) has notified the Company that he/she has a present intention to sell Shares to the Company nor has he/ she undertaken not to sell any of the Shares held by him/her to the Company in the event that the Company is authorised to make purchases of Shares.

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Undertaking of the directors

The directors have undertaken to the Stock Exchange to exercise the power of the Company to make purchases pursuant to the proposed resolution in accordance with the Listing Rules and all applicable laws of Bermuda, and in accordance with the regulations set out in the Memorandum of Association and Bye-laws of the Company.

Effect of Takeovers Code

A repurchase of Shares by the Company may result in an increase in the proportionate interest of a substantial shareholder of the Company in the voting rights of the Company, which could give rise to an obligation to make a mandatory offer in accordance with Rule 26 of the Hong Kong Code on Takeovers and Mergers (the “Code”).

As at the Latest Practicable Date, to the best of the knowledge and belief of the Company, Dr. Yeung Ming Biu (“Dr. Yeung”) (together with his associates), who held approximately 27.04 per cent of the issued share capital of the Company, was the only substantial shareholder holding more than 10 per cent of the issued share capital of the Company. In the event that the directors should exercise in full the power to repurchase Shares which is proposed to be granted pursuant to the resolution, the shareholding of such shareholder in the Company would be increased to approximately 30.04 per cent of the issued share capital of the Company and such increase would give rise to an obligation on Dr. Yeung (together with his associates) to make a mandatory offer under Rule 26 of the Code. The Company has no present intention to exercise the repurchase mandate to the extent that such obligation of will be triggered.

Stock Exchange Rules for repurchases of shares

The Listing Rules permit companies whose primary listings are on the Stock Exchange to repurchase their shares on the Stock Exchange subject to certain restrictions, the most important of which are summarised below:

(a) Shareholders’ approval

The Listing Rules provide that all shares repurchases on the Stock Exchange by a company with its primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, which may be by way of general mandate, or by special resolution in relation to specific transactions.

(b) Source of funds

Repurchases must be funded out of funds legally available for the purpose.

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General

During each of the six months preceding the date of this circular, no Share had been repurchased by the Company.

During each of the previous 12 months, the highest and lowest traded prices for Shares on the Stock Exchange were as follows:

		Per Share
	Highest		Lowest
Month	HK$		HK$
2017
July	1.70		1.49
August	1.80		1.62
September	1.82		1.64
October	1.75		1.64
November	1.84		1.65
December	1.82		1.69
2018
January	2.17		1.75
February	2.09		1.81
March	2.37		1.93
April	2.65		2.22
May	2.88		2.43
June	2.92		2.33
July (up to the Latest Practicable Date)	2.46		2.27

ANNUAL GENERAL MEETING

You will find on pages 9 to 12 of this circular a notice of the AGM to be held at 3:00 p.m. on 29th August, 2018 at Victoria Room, 2nd Floor, Mandarin Oriental Hong Kong, 5 Connaught Road Central, Hong Kong. Voting at the AGM will be taken by poll.

Resolution no. 5A will be proposed as an ordinary resolution to give a general mandate to the directors to allot, issue and deal with shares of the Company not exceeding 20 per cent of the total number of Shares in issue as at the date of the resolution.

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Resolution no. 5B will be proposed as an ordinary resolution to give a general mandate to the directors to make on-market purchases of shares of the Company not exceeding 10 per cent of the total number of Shares in issue as at the date of the resolution.

Resolution no. 5C will be proposed as an ordinary resolution to extend resolution no. 5A to include the total number of Shares which are repurchased by the Company under the authority granted to the directors pursuant to resolution no. 5B.

There is enclosed a form of proxy for use at the AGM. You are requested to complete the form of proxy and return it to the principal office of the Company in accordance with the instructions printed thereon not less than 48 hours before the time fixed for holding the meeting, whether or not you intend to be present at the meeting. The completion and return of the form of proxy will not prevent you from attending and voting in person should you so wish.

RE-ELECTION OF DIRECTORS

Resolutions will be proposed at the AGM for re-election of Dr. Yeung, Mr. Yeung Him Kit, Dennis and Dr. Li Sau Hung, Eddy as directors according to the Company’s Bye-laws. Their particulars are as follows:

Dr. Yeung , aged 82, a co-founder of the Company and its subsidiaries (the “Group”), is the Chairman and an executive director of the Company. He has over 60 years’ experience in the watch business and is a Permanent Honorary Director of The Federation of Hong Kong Watch Trades and Industries Limited. He is an Honorary Fellow of The Chinese University of Hong Kong and holds Honorary Doctor degree awarded by Lansbridge University of New Brunswick of Canada.

Mr. Yeung Him Kit, Dennis (“Mr. Yeung”), aged 49, joined the Group in 1993 and has been the Deputy Chairman and the Managing Director of the Company since March 2003. He holds a bachelor degree in commerce from the University of Toronto, Canada. Mr. Yeung is the son of Dr. Yeung.

Dr. Li Sau Hung, Eddy (“Dr. Li”), G.B.S., J.P., aged 63, has over 40 years’ experience in the manufacturing business. He is the President of Hong Kong Economic & Trade Association and the Permanent Honorary President of The Chinese Manufacturers’ Association of Hong Kong. Dr. Li holds a Master Degree of Business Administration and a PhD Degree in Economics. He was the 1991 awardee of The Ten Outstanding Young Persons and the 1993 awardee of Young Industrialists of Hong Kong. He has been an Independent Non-executive Director of the Company since September 1993. He is currently an Independent Non-executive Director of Man Yue Technology Holdings Limited (stock code: 0894) and Chuang’s China Investments Limited (stock code 298), both of which are listed on the Stock Exchange. During the period from 5 August 2004 to 26 January 2018, Dr. Li had been an independent non-executive director of Midas International Holdings Limited (stock code 1172), a company listed on the Stock Exchange.

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None of the above directors has any service contract with the Company. They are not appointed for a specific term but are subject to retirement by rotation in annual general meetings of the Company in accordance with the Bye-laws of the Company. Dr. Yeung and Mr. Yeung receive basic monthly salaries of HK$204,000 and HK$235,000 respectively, and they are entitled to a discretionary year end bonus. Their emoluments are determined with reference to their experience and contribution to the Group. Dr. Li receives a director’s fee of HK$180,000 per annum, which is determined with reference to the prevailing range of fees for independent non-executive directors of listed companies in Hong Kong.

Dr. Li has served as an independent non-executive director of the Company for more than 9 years. The board of directors of the Company believes that he is still independent as he complies with Rule 3.13 of the Listing Rules and has acted independently in the discharge of his duty to the Company and should be re-elected so that the Company can continue to benefit from his extensive business experience.

The interests of the above named directors in Shares within the meaning of Part XV of the Securities and Futures Ordinance (the “SFO”) as at the Latest Practicable Date were as follows:

• (a) Dr. Yeung was interested in a total of 155,754,144 Shares (comprising personal interest in 19,669,583 Shares (including an option to subscribe for 1,440,000 Shares during the period from 6th April, 2011 to 5th April, 2021 at the price of HK$3.44 per Share), family interest in 7,920,000 Shares and corporate interest in 128,164,561 Shares);

• (b) Mr. Yeung was interested in 5,524,000 Shares (including an option to subscribe for 1,440,000 Shares during the period from 6th April, 2011 to 5th April, 2021 at the price of HK$3.44 per Share); and

• (c) Dr. Li had no interest in Shares.

Save as disclosed above, the above named directors confirm:

• (a) they have no relationships with any directors, senior management or substantial or controlling shareholders of the Company;

• (b) they have no interests in shares of the Company within the meaning of Part XV of the SFO; and

• (c) there is no information which is required to be disclosed pursuant to Rule 13.51(2) of the Listing Rules or any other matter that need to be brought to the attention of shareholders of the Company.

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RECOMMENDATION

The directors consider that the proposed granting of the mandates to issue and repurchase shares of the Company are in the interest of the Company and the shareholders as a whole and so recommend you to vote in favour of the relevant resolutions at the AGM. The directors will vote all their shareholdings in favour of such resolutions.

Yours faithfully, By order of the Board Yeung Ming Biu Chairman

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NOTICE OF ANNUAL GENERAL MEETING

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ORIENTAL WATCH HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 398)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the annual general meeting of the abovenamed company (the “Company”) will be held at 3:00 p.m. on 29th August, 2018 at Victoria Room, 2nd Floor, Mandarin Oriental Hong Kong, 5 Connaught Road Central, Hong Kong for the following purposes:

1. To receive and consider the audited financial statements and the reports of the directors and independent auditor for the year ended 31st March, 2018.

2. To declare a final dividend of 8.0 Hong Kong cents per share and a special dividend of 15.0 Hong Kong cents per share for the year ended 31st March, 2018.

3. To elect directors and to authorise the board of directors to fix their remuneration.

4. To appoint auditor and to authorise the board of directors to fix its remuneration.

5. As special business, to consider and, if thought fit, pass the following resolutions as ordinary resolutions:

ORDINARY RESOLUTIONS

• A. “ THAT :

• (a) subject to paragraph (c), the exercise by the directors of the Company during the Relevant Period of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant offers, agreements and options which might require the exercise of such power be and is hereby generally and unconditionally approved;

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• (b) the approval in paragraph (a) shall authorise the directors of the Company during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such power after the end of the Relevant Period;

• (c) the total number of shares allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the directors of the Company pursuant to the approval in paragraph (a), otherwise than pursuant to a Rights Issue or scrip dividend scheme or similar arrangement of the Company or the exercise of the subscription rights under the share option scheme of the Company shall not exceed 20 per cent of the total number of shares of the Company in issue as at the date of this resolution and the said approval shall be limited accordingly; and

• (d) for the purposes of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earlier 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 Bye-laws of the Company or any applicable law to be held; and

• (iii) the revocation or variation of this resolution by an ordinary resolution of the shareholders of the Company in general meeting; and

“Rights Issue” means an offer of shares open for a period fixed by the directors of the Company to holders of shares on the register of members of the Company on a fixed record date in proportion to their then holdings of such shares (subject to such exclusion or other arrangements as the directors of the Company 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 outside Hong Kong).”

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B. “ THAT :

• (a) the exercise by the directors of the Company during the Relevant Period of all powers of the Company to purchase its own shares, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

• (b) the total number of shares of the Company purchased by the Company pursuant to the approval in paragraph (a) during the Relevant Period shall not exceed 10 per cent of the total number of shares of the Company in issue as at the date of this resolution and the said approval be limited accordingly; and

• (c) for the purposes of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earlier 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 Bye-laws of the Company or any applicable law to be held; and

• (iii) the revocation or variation of this resolution by an ordinary resolution of the shareholders of the Company in general meeting.”

• C. “ THAT conditional upon resolution no. 5B above being passed, the total number of shares of the Company which are repurchased by the Company under the authority granted to the directors as mentioned in resolution no. 5B above shall be added to the total number of shares that may be allotted or agreed conditionally or unconditionally to be allotted by the directors of the Company pursuant to resolution no. 5A above.”

By Order of the Board Lam Hing Lun, Alain Company Secretary

Hong Kong, 26th July, 2018

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Principal Office: Room 312-8 China Insurance Group Building 141 Des Voeux Road Central

Hong Kong

Notes:

• (1) A member entitled to attend and vote at the meeting convened by the above notice is entitled to appoint proxies to attend and, in the event of a poll, vote in his stead. A proxy need not be a member of the Company. In order to be valid, the form of proxy must be deposited at the Company’s principal office in Hong Kong together with a power of attorney or other authority, if any, under which it is signed or a certified copy of that power or authority, not less than 48 hours before the time for holding the meeting or adjourned meeting.

• (2) The register of members of the Company will be closed from 24th August, 2018 to 29th August, 2018, both days inclusive, during which period no transfer of shares will be effected. In order to be entitled to attend and vote at the annual general meeting, all transfers accompanied by the relevant share certificates must be lodged with the Company’s branch share registrars in Hong Kong, Tricor Secretaries Limited, Level 22, Hopwell Centre, 183 Queen’s Road East, Hong Kong not later than 4:30 p.m. on 23rd August, 2018.

• (3) The register of members of the Company will be closed from 4th September, 2018 to 6th September, 2018, both days inclusive, during which period no transfer of shares will be effected. In order to qualify for the final dividend and the special dividend to be approved at the annual general meeting, all transfers accompanied by the relevant share certificates must be lodged with the Company’s branch share registrars in Hong Kong, Tricor Secretaries Limited, Level 22, Hopwell Centre, 183 Queen’s Road East, Hong Kong not later than 4:30 p.m. on 3rd September, 2018.

As at the date of this notice, the executive directors of the Company are Dr. Yeung Ming Biu (the Chairman), Mr. Yeung Him Kit, Dennis, Madam Yeung Man Yee, Shirley, Mr. Lam Hing Lun, Alain and Mr. Choi Kwok Yum, and the independent non-executive directors are Dr. Sun Ping Hsu, Samson, Dr. Li Sau Hung, Eddy and Mr. Choi Man Chau, Michael.

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