KOALA Financial Group Limited — Proxy Solicitation & Information Statement 2015

Sep 14, 2015

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 adviser.

If you have sold or transferred all your shares in Sunrise (China) Technology Group Limited (the “ Company ”), you should at once hand this circular and the accompanying form of proxy to the purchaser, the transferee, or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or 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.

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(incorporated in the Cayman Islands with limited liability) (Stock Code: 8226)

PROPOSED REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES AND NOTICE OF EXTRAORDINARY GENERAL MEETING

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

A letter from Veda Capital Limited, the independent financial adviser to the independent board committee of the Company, containing its opinion to the independent board committee of the Company, in relation to the proposed refreshment of general mandate to issue shares, is set out on pages 11 to 17 of this circular.

A letter from the independent board committee of the Company, in relation to the proposed refreshment of general mandate to issue shares, is set out on page 10 of this circular.

A notice convening the extraordinary general meeting of the Company to be held at 10:00 a.m. on Tuesday, 6 October 2015 at Units 01-03, 28th Floor, Shui On Centre, 6-8 Harbour Road, Wan Chai, Hong Kong is set out on pages EGM1 to EGM-3 of this circular. A form of proxy for use by the shareholders of the Company at the extraordinary general meeting at the Company is enclosed herein.

Whether or not you intend to attend the extraordinary general meeting, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to Union Registrars Limited at the Hong Kong branch share registrar and transfer office of the Company, at A18/F., Asia Orient Tower, Town Place, 33 Lockhart Road, Wanchai, Hong Kong as soon as possible but in any event no later than 48 hours before the time appointed for the holding of the extraordinary general meeting of the Company (or any adjournment thereof). Completion and delivery of the accompanying form of proxy will not preclude you from attending and voting in person at the extraordinary general meeting of the Company (or any adjournment thereof) if you so wish, and in such case, the form of proxy previously submitted shall be deemed to be revoked.

This circular will remain on the “Latest Company Announcements” page of the website of the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited at www.hkgem.com for at least 7 days from the date of its publication and on the Company’s website at www.sunrisechina-tech.com.

14 September 2015

CONTENTS

	Page
Characteristics of GEM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Letter from the Independent Board Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Letter from Veda Capital Limited. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Notice of the EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . EGM-1

i

CHARACTERISTICS OF GEM

GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

ii

DEFINITIONS

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

“AGM”	the annual general meeting of the Company held on 8 May 2015
“Articles”	the articles of association of the Company as amended from time
	to time
“associate(s)”	has the meaning ascribed thereto in the GEM Listing Rules
“Board”	the board of Directors
“Company”	Sunrise (China) Technology Group Limited, a company
	incorporated in the Cayman Islands with limited liability and the
	issued Shares of which are listed on GEM
“Director(s)”	the director(s) of the Company
“EGM”	the extraordinary general meeting of the Company to be held
	at 10:00 a.m. on Tuesday, 6 October 2015 for the purpose of
	considering, and if thought fit, approving the proposed grant of
	the Refreshed General Mandate, the notice of which is set out on
	pages EGM-1 to EGM-3 of this circular
“Existing General Mandate”	the general mandate approved and granted to the Directors at the
	AGM to allot, issue and deal with Shares up to a maximum of
	20% of the aggregate nominal amount of the share capital of the
	Company in issue as at the date of the AGM
“GEM”	the Growth Enterprise Market of the Stock Exchange
“GEM Listing Rules”	the Rules Governing the Listing of Securities on GEM
“Group”	the Company and its subsidiaries
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC
“Independent Board Committee”	the independent committee of the Board comprising the three
	independent non-executive Directors formed for the purpose
	of advising and giving recommendation to the Independent
	Shareholders in relation to the Refreshed General Mandate

1

DEFINITIONS

• “Independent Financial Adviser”

• or “Veda Capital Limited”

• Veda Capital Limited, a licensed corporation under the SFO licensed to conduct type 6 (advising on corporate finance) regulated activity under the SFO, being the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders in respect of the Refreshed General Mandate

• “Independent Shareholders” Shareholders other than any controlling Shareholders and their associates or, where there are no controlling Shareholders, any Directors (excluding independent non-executive Directors) and the chief executive of the Company who shall hold Shares as at the date of the EGM and their respective associates

• “Latest Practicable Date” 14 September 2015, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein

• “Placing” the issue of 103,623,000 Shares under the Existing General Mandate by way of placing, details of which are set out in the announcements of the Company dated 22 July 2015 and 7 August 2015

• “PRC” the Peoples’ Republic of China which, for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

• “Refreshed General Mandate” a general and unconditional mandate proposed to be granted to the Directors at the EGM to exercise the power of the Company to allot, issue or otherwise deal with the shares of the Company up to a maximum of 20% of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing the resolution

• “SFO” the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong

• “Share(s)” ordinary share(s) of HK$0.01 each in the share capital of the Company

• “Shareholder(s)” holder(s) of the Share(s)

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Takeovers Code” the Code on Takeovers and Mergers issued by the Securities and Futures Commission as amended from time to time

• “%”

per cent.

2

LETTER FROM THE BOARD

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(incorporated in the Cayman Islands with limited liability) (Stock Code: 8226)

Executive Directors:

Mr. Ma Arthur On-hing Mr. Shan Biao Mr. Mui Wai Sum Ms. Kwan Kar Ching

Non-executive Director: Mr. Chen Wai Chung Edmund

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

Independent Non-executive Directors: Mr. Ho Chun Kit Gregory Mr. Ho Wai Shing Mr. Hung Cho Sing

Head Office and Principal Place of Business in Hong Kong: Units 01-03, 28th Floor Shui On Centre 6-8 Harbour Road Wan Chai, Hong Kong

14 September 2015

To the Shareholders

Dear Sir/Madam,

PROPOSED REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES AND NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with (i) information in respect of the resolution to be proposed at the EGM regarding the proposed grant of the Refreshed General Mandate; (ii) the recommendation of the Independent Board Committee to the Independent Shareholders; (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.

A notice convening the EGM is set out on pages EGM-1 to EGM-3 to this circular.

3

LETTER FROM THE BOARD

PROPOSED REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

Pursuant to an ordinary resolution passed by the Shareholders at the AGM, the Directors were granted the Existing General Mandate to allot and issue up to 103,623,394 Shares, representing 20% of the issued share capital of the Company as at the date of the AGM. There had not been any refreshment of the Existing General Mandate since the AGM up to the Latest Practicable Date.

Equity fund raising activities under the Existing General Mandate

Save for the equity fund raising activities mentioned below, the Company has not carried out other equity fund raising activities under the Existing General Mandate since the AGM and up to the Latest Practicable Date.

Actual use of Net proceeds Intended use of proceeds as at the Date Event (approximately) proceeds Latest Practicable Date 16 July 2015 Issue of HK$77.5 million Intended to be used for The net proceeds had been convertible bonds repayment of certain used as follows: liabilities, as general working (i) capital and for future million was applied potential investment for repayment to the opportunities of noteholder; the Group.

The net proceeds had been used as follows:

• (i) approximately HK$23.6 million was applied for repayment to the noteholder;

• (ii) approximately HK$22.9 million was applied for repayment to other borrowings and corporate bonds;

• (iii) approximately HK$22.5 million was applied for investment of listed shares; and

• (iv) approximately HK$8.5 million was applied as general working capital of the Group.

4

LETTER FROM THE BOARD

Date

Event

Net proceeds Intended use of (approximately) proceeds

Actual use of proceeds as at the Latest Practicable Date

7 August 2015 Placing of 103,623,000 new Shares under general mandate

HK$43.2 million Intended to be used as general working capital of the Group.

The net proceeds had been/ was to be used as follows:

• (i) approximately HK$19.9 million had been used as general working capital of the Group; and

• (ii) approximately HK$23.3 million was to be used as general working capital of the Group:

• (a) approximately HK$3.3 million were cash deposits in the Company’s savings account with a licensed bank in Hong Kong; and

• (b) approximately HK$20.0 million were cash deposits in the Company’s investment account with its broker.

Extent of Existing General Mandate utilised

As at the Latest Practicable Date, the Placing was completed and 103,623,000 new Shares had been allotted and issued under Existing General Mandate, representing approximately 99.999% of the Existing General Mandate.

Reasons for the proposed grant of the Refreshed General Mandate

The Company is an investment holding company. The Group is principally engaged in (i) manufacturing and sales of straw briquettes, (ii) trading of commodities, (iii) trading of garment accessories, (iv) manufacturing and trading of LED digital display products, and (v) investment in securities. Given that the Company currently does not have a target/need to use the Refreshed General Mandate, and the Refreshed General Mandate merely provide an alternative source of funding should any investment opportunity arises, there shall not have immediate dilution impact on the Shareholders. Without prejudice to the aforesaid, the Board is also aware of the issue of news Share under the Refreshed General Mandate may cause dilution impact on the Shareholders. The Board will be prudent in issuing new Shares under the Refreshed General Mandate in future. The Directors will well balance the benefit of the potential investment opportunity that brings to the Company, the need of fund and the dilution impact caused by the issue of new Shares. The Directors are of the view that the proposed grant of the Refreshed General Mandate is justifiable and in the interest of the Company and its Shareholders as a whole.

5

LETTER FROM THE BOARD

The Board would like to provide flexibility for the Company to raise funds for its future business development and/or opportunities to be identified by the Company through equity financing. Given that equity financing (i) does not incur any interest expenses on the Group as compared with bank financing; (ii) is less costly and time-consuming than raising funds by way of rights issue or open offer; and (iii) provides the Company with the capability to capture any capital raising and/or prospective investment opportunity as and when it arises, the Board proposes the Refreshed General Mandate shall be granted to the Directors.

In addition, as the net proceeds from the Placing has partly been utilised and the remaining proceeds have been planned its intended use as set out in the paragraph headed “ Equity fund raising activities under the Existing General Mandate” above, the Group will still need funds when opportunities arise and the Director consider that the Refreshed General Mandate will enable the Company to raise funds for capturing opportunities with funding available to be used. As at the Latest Practicable Date, the Company has not identified any such business development and/or opportunities.

Based on the total number of issued Shares as at the Latest Practicable Date (i.e. 832,266,289 Shares) and assuming that there is no change in the issued share capital of the Company prior to the date of the EGM, the Refreshed General Mandate, if granted, will allow the Directors to allot and issue up to 166,453,257 new Shares.

As at the Latest Practicable Date, the Directors had no intention to utilise the Refreshed General Mandate, if granted, to allot and issue Shares but may do so if new business opportunities arise and/or if the Company is in need of funds for its operations in the future. The Company currently does not have a target/need which requires the utilisation of the Refreshed General Mandate. The Company is merely reserving its right to one alternative source of funding should any investment opportunity arises.

The Refreshed General Mandate, if granted, will expire at the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by the Articles or any applicable law to be held; or (c) the revocation and variation of the Refreshed General Mandate by an ordinary resolution of the Shareholders in a general meeting prior to the next annual general meeting of the Company.

6

LETTER FROM THE BOARD

Effects on Shareholding Structure of the Company

The table below illustrates the shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) immediately upon the allotment and issue of Shares by the Company pursuant to the Refreshed General Mandate (assuming the Refreshed General Mandate is utilised in full and no further Shares are issued or repurchased by the Company):

Shareholders Wong Ka Man Hua R Sheng Technology Company Limited_(Note)_ Public Shareholders Shares to be issued under the Refreshed General Mandate Total:	(i) As at the Latest Practicable Date No. of Approximate Shares % 210,526,315 25.30 60,000,000 7.21 561,739,974 67.49 – – 832,266,289 100.00	(ii) Immediately upon the allotment and issue of Shares by the Company pursuant to the Refreshed General Mandate (assuming the Refreshed General Mandate is utilised in full and no further Shares are issued or repurchased by the Company) No. of Approximate Shares % 210,526,315 21.08 60,000,000 6.01 561,739,974 56.24 166,453,257 16.67 998,719,546 100.00	(ii) Immediately upon the allotment and issue of Shares by the Company pursuant to the Refreshed General Mandate (assuming the Refreshed General Mandate is utilised in full and no further Shares are issued or repurchased by the Company) No. of Approximate Shares % 210,526,315 21.08 60,000,000 6.01 561,739,974 56.24 166,453,257 16.67 998,719,546 100.00
			100.00

Note: The entire issued share capital of Hua R Sheng Technology Company Limited is wholly and beneficially owned by Mr. Yan Qiyu.

EGM

The EGM will be held at 10:00 a.m. on Tuesday, 6 October 2015 at Units 01-03, 28th Floor, Shui On Centre, 6-8 Harbour Road, Wan Chai, Hong Kong for the Independent Shareholders to consider and approve, if thought fit, the proposed grant of the Refreshed General Mandate. The notice of the EGM is set out on pages EGM-1 to EGM-3 of this circular.

A form of proxy for use at the EGM is enclosed with this circular. Whether or not you are able to attend the EGM, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return it to the branch share registrar and transfer office of the Company in Hong Kong, Union Registrars Limited, at A18/F., Asia Orient Tower, Town Place, 33 Lockhart Road, Wanchai, 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 will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish, and in such case, the form of proxy previously submitted shall be deemed to be revoked.

7

LETTER FROM THE BOARD

Pursuant to Rule 17.47(4) of the GEM Listing Rules, any vote of shareholders at a general meeting must be taken by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. As such, the resolution set out in the notice of the EGM will be voted on by way of poll.

As the proposed grant of the Refreshed General Mandate is to be proposed to the Shareholders before the Company’s next annual general meeting, pursuant to the GEM Listing Rules, this proposal is subject to the Independent Shareholders’ approval by way of poll at the EGM. According to Rule 17.42A(1) of the GEM 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 proposed grant of the Refreshed General Mandate. Given that the Company has no controlling Shareholder and neither the Directors (excluding independent non-executive Directors) nor the chief executive of the Company and their respective associates have any interest in the Shares, no Shareholders are required to abstain from voting in favour of the proposed resolution(s) at the EGM.

The Independent Board Committee, comprising Mr. Ho Chun Kit Gregory, Mr. Ho Wai Shing and Mr. Hung Cho Sing, all being independent non-executive Directors, has been established to advise the Independent Shareholders on the proposed grant of the Refreshed General Mandate. Veda Capital Limited has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the proposed grant of the Refreshed General Mandate.

GENERAL

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder is required to abstain from voting on the resolution to be proposed at the EGM.

RECOMMENDATION

Your attention is drawn to the letter of recommendation from the Independent Board Committee set out on page 10 of this circular and the letter of advice from the Independent Financial Adviser set out on pages 11 to 17 of this circular, which contains, among other matters, 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 recommendation.

The Independent Board Committee, having taken into account the advice of the Independent Financial Adviser, is of the opinion that the proposed grant of the Refreshed General Mandate is fair and reasonable so far as the Independent Shareholders are concerned and is in the best interests of the Company and the Shareholders and accordingly recommends the Independent Shareholders to vote in favour of the resolution relating to the proposed grant of the Refreshed General Mandate to be proposed at the EGM.

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

8

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 GEM Listing Rules for the purpose of giving information with regard to the Group. 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.

Yours faithfully, On behalf of the Board

Sunrise (China) Technology Group Limited Ma Arthur On-hing Executive Director

9

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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(incorporated in the Cayman Islands with limited liability) (Stock Code: 8226)

14 September 2015

To the Independent Shareholders

Dear Sir/Madam

PROPOSED REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

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 to the Shareholders dated 14 September 2015 (the “ 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.

Having considered the advice of Independent Financial Adviser in relation thereto as set out in the Circular, we are of the view that the proposed grant of the Refreshed General Mandate is fair and reasonable so far as the Independent Shareholders are concerned and that the proposed 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 proposed grant of the Refreshed General Mandate.

Yours faithfully,

For and on behalf of the Independent Board Committee

Mr. Ho Chun Kit Gregory Mr. Ho Wai Shing Mr. Hung Cho Sing

Independent non-executive Directors

10

LETTER FROM VEDA CAPITAL LIMITED

The following is the text of the letter of advice from Veda Capital Limited in connection with the proposed grant of the Refreshed General Mandate which has been prepared for the purpose of inclusion in this circular.

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Veda Capital Limited Suite 3711, 37/F Tower II, Times Square 1 Matheson Street Causeway Bay, Hong Kong

14 September 2015

To the Independent Board Committee and the Independent Shareholders of Sunrise (China) Technology Group Limited

Dear Sirs,

PROPOSED REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

INTRODUCTION

We refer to our appointment to advise the Independent Board Committee and the Independent Shareholders in relation to the proposed grant of the Refreshed General Mandate, details of which are set out in the letter from the Board (the “ Board Letter ”) contained in the circular dated 14 September 2015 (the “ Circular ”) to the Shareholders, of which this letter forms part. Terms used herein have the same meanings as those defined in the Circular unless the context requires otherwise.

As the proposed grant of the Refreshed General Mandate is to be proposed to the Shareholders before the Company’s next annual general meeting, pursuant to the GEM Listing Rules, the proposed grant of the Refreshed General Mandate is subject to the Independent Shareholders’ approval by way of poll at the EGM. According to Rule 17.42A(1) of the GEM 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 proposed grant of the Refreshed General Mandate. As at the Latest Practicable Date, as confirmed by the Company, to the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder is required to abstain from voting on the resolutions to be proposed at the EGM. Should any of the Directors and their respective associates hold any interests in the Shares at the date of the EGM, they will be required to abstain from voting in favor of the relevant resolution to approve the proposed grant of the Refreshed General Mandate.

The Independent Board Committee, comprising Mr. Ho Chun Kit Gregory, Mr. Ho Wai Shing and Mr. Hung Cho Sing, all being the independent non-executive Directors, has been established to advise the Independent Shareholders as to whether the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole and the terms of the proposed grant of the Refreshed General Mandate are fair and reasonable so far as the Independent Shareholders are concerned. We have been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

11

LETTER FROM VEDA CAPITAL LIMITED

BASIS OF OUR OPINION

In formulating our opinion and advice, we have relied upon accuracy of the information and representations contained in the Circular and information provided to us by the Company, the Directors and the management of the Company. We have assumed that all statements, information and representations made or referred to in the Circular and all information and representations which have been provided by the Company, the Directors and the management of the Company, for which they are solely and wholly responsible, were true at the time they were made and continue to be true as at the Latest Practicable Date. We have also assumed that all statements of belief, opinion and intention made by the Directors in the Circular were reasonably made after due and careful enquiry and were based on honestly-held opinions.

The Directors have collectively and individually accepted full responsibility for the accuracy of the information contained in the Circular and have confirmed, having made all reasonable enquiries that, to the best of their knowledge and belief, there are no other facts the omission of which would make any statements in the Circular misleading. We have no reason to believe that any information and representations relied on by us in forming our opinion is untrue, inaccurate or misleading, nor are we aware of any material facts the omission of which would render the information provided and the representations made to us untrue, inaccurate or misleading. We have not, however, conducted any independent in-depth investigation into the business affairs, financial position or future prospects of the Group, nor have we carried out any independent verification of the information provided by the Directors and management of the Company.

As at the Latest Practicable Date, we were not aware of any relationships or interest between us and the Company or any other parties that could be reasonably be regarded as hindrance to our independence as defined under Rule 17.96 of the GEM Listing Rules to act as the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the undertaking and the transactions contemplated thereunder. We are not associated with the Company, its subsidiaries, its associates or their respective substantial shareholders or associates, and accordingly, are eligible to give independent advice and recommendations on the terms of the undertaking and the transactions contemplated thereunder. Apart from normal professional fees payable to us in connection with this appointment as the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders, no arrangement exists whereby we will receive any fees from the Company, its subsidiaries, its associates or their respective substantial shareholders or associates.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion in relation to the proposed grant of the Refreshed General Mandate, we have taken the following principal factors and reasons into consideration:

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

As set out in the Board Letter, pursuant to the ordinary resolution passed by the Shareholders at the AGM, the Directors were granted the Existing General Mandate to allow and issue up to 103,623,394 Shares, representing 20% of the issued share capital of the Company as at the date of the AGM.

12

LETTER FROM VEDA CAPITAL LIMITED

On 7 August 2015, the Company announced to place 103,623,000 new Shares (the “ Placing ”) for net proceeds of approximately HK$43.2 million which is intended to be applied for general working capital of the Group. As at the Latest Practicable Date, the Placing was completed and 103,623,000 new Shares had been allotted and issued under the Existing General Mandate.

The Company confirms there had not been any refreshment of the Existing General Mandate since the AGM up to the Latest Practicable Date and as a result of the Placing, the Existing General Mandate has been fully utilised.

Based on the total number of issued Shares as at the Latest Practicable Date (i.e. 832,266,289 Shares) and assuming that there is no change in the issued share capital of the Company prior to the date of the EGM, the Refreshed General Mandate, if granted, will allow the Directors to allot and issue up to 166,453,257 new Shares.

As noted from the Board Letter, as at the Latest Practicable Date, the Directors had no intention to utilise the Refreshed General Mandate, if granted, to allot and issue Shares but may do so if new business opportunities arise and/or if the Company is in need of funds for its operations in the future.

The Company is an investment holding company. The Group is principally engaged in (i) manufacturing and sales of straw briquettes; (ii) trading of commodities; (iii) trading of garment accessories; (iv) manufacturing and trading of LED digital display products; and (v) investment in securities.

As stated in the interim report of the Company for the six months ended 30 June 2015 (the “ IR 2015 ”), the Group recorded a net loss of approximately HK$48.8 million for the six months ended 30 June 2015, representing approximately 7 times of the net loss of approximately HK$7.2 million (excluding a gain of HK$50.9 million from the disposal of a subsidiary of the Company in first quarter of 2014) for the six months ended 30 June 2014. The increase in loss was mainly attributable to the provision for impairment on the plant and equipment, trade and other receivables of the Company’s subsidiary of approximately HK$25.5 million, the legal and profession fees of HK$3.9 million and the finance costs of HK$4.0 million paid to the noteholder.

Also disclosed in the IR 2015, the Group’s major business operations took place in the PRC and Hong Kong, and financed mainly by the cash revenue generated from operating activities and by corporate borrowings. As advised by the Company, the Group is expected to continue to strengthen its existing business, proactively explore new business scope and continuously seek other suitable investment opportunities.

As set out in the Board Letter, the Company has conducted equity fund-raising activities since the AGM and up to the Latest Practicable Date. On 16 July 2015, the Company announced the completion of the issue of convertible bonds in the principal amount of HK$80,000,000 to a subscriber for net proceeds of approximately HK$77.5 million and as previously mentioned the Company completed the Placing for net proceeds of approximately HK$43.2 million (collectively, the “ Previous Fund-Raising Activities ”). These proceeds were partly utilised and the details of which are described in the sub-section headed “Equity fund raising activities under the Existing General Mandate” in the Board Letter.

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LETTER FROM VEDA CAPITAL LIMITED

As advised by the Company, the Company has a total unutilised fund from the Previous FundRaising Activities of approximately HK$23.3 million (the “ Unutilised Fund ”). The Company is expected to apply most of the Unutilised Fund (approximately HK$20.0 million) for securities investment which in lines with the Group’s intention to commence new business activity involving investment in securities (the “ New Business ”) to generate additional investment returns on the available funds of the Company from time to time as set out in the announcement dated 14 August 2015 of the Company. In addition, further advised by the Company, the nature of the New Business is viewed as to be capital intensive and as at 10 September 2015, the Group’s cash and bank balance amounts to be approximately HK$23.3 million but the Group has also reached a gearing ratio of 56.0%. The latest financial results of the Company for the six months ended 30 June 2015 combined with the high gearing ratio of the Group may affect the ability of the Group to obtain bank borrowings if and when necessary.

As further noted from the IR 2015, benefited from the enormous support given by the PRC government towards environmental related industry, the environmental sector is filled with promising development opportunities and clear, direct guidelines, which further fortified the Group’s objective to develop the environmental related industry. The Group will continue to strengthen the existing business of Shengyan, proactively explore new business scope and continuously seek other suitable investment opportunities.

As set out in the Board Letter, the Board would like to provide flexibility for the Company to raise funds for its future business development and/or opportunities to be identified by the Company through equity financing. Given that equity financing (i) does not incur any interest expenses on the Group as compared with bank financing; (ii) is less costly and time-consuming than raising funds by way of rights issue or open offer; and (iii) provides the Company with the capability to capture any capital raising and/ or prospective investment opportunity as and when it arises, the Board proposes the Refreshed General Mandate shall be granted to the Directors. In addition, as advised by the Company, it currently does not have a target/need which requires the utilisation of the Refreshed General Mandate and it is merely reserving its right to one alternative source of funding should the Group needs available funds when opportunities arise and the Director consider that the Refreshed General Mandate will enable the Company to raise funds for capturing opportunities with funding available to be used. As at the Latest Practicable Date, the Company has not identified any such business development and/or opportunities.

Having considered (i) the Existing General Mandate has been fully utilised; (ii) the financial performance and position of the Group may affect the Group’s ability to obtain bank borrowings if and when necessary; (iii) most of the Unutilised Fund from the Previous Fund-Raising Activities has already been planned its intended use; (iv) the Group is proactively exploring new business scope and continuously seeking other suitable investment opportunities and that the proposed grant of the Refreshed General Mandate will strengthen the capital base and financial position and improve flexibility for the Group in the future should opportunistic investment arise (if any); (v) the Refreshed General Mandate merely provides the Company an alternative source of funding and supplementary flexibility which is comprehensible and in the interests of the Company; and (vi) the grant of the Refreshed General Mandate would strengthen the capital base and financial position of the Company, we concur with the view of the Directors that the proposed grant of the Refreshed General Mandate is in the interests of the Company and the Shareholders as a whole.

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LETTER FROM VEDA CAPITAL LIMITED

2. Other financing alternatives

The Directors confirmed that apart from equity financing, the Group will also consider debt financing, such as bank borrowings and issue of bonds, to be other possible fund raising alternatives available to the Group. However, the Directors are of the view that the ability of the Group to obtain bank borrowings usually depends on the Group’s profitability, financial position and the then prevailing market condition. Furthermore, such alternative may be subject to lengthy due diligence and negotiations with banks. In light of also that debt financing will usually incur interest burden on the Group, the Directors consider debt financing to be relatively uncertain and time-consuming as compared to equity financing, such as placing of new Shares, for the Group to obtain additional funding.

Besides, the Directors also considered that other forms of equity fund raising such as rights issue and open offer would incur additional costs in underwriting commission or placing commission and possibly require relatively longer time to complete.

We consider that the grant of the Refreshed General Mandate will provide the Company with an additional alternative and it is reasonable for the Company to have the flexibility in deciding the financing methods for its business operations and future development as well as any potential future investment opportunities when arise, including equity financing. As such, we are of the view that the grant of the Refreshed General Mandate will be in the interests of the Company and the Shareholders as a whole. We also consider it is prudent and reasonable for the Group to maintain a strong capital base while additional funding may be needed for investment and business expansion purposes from time to time. We consider that the proposed grant of the Refreshed General Mandate is fair and reasonable so far as the Independent Shareholders are concerned and is an effective equity financing alternative for the Group to raise capital in a timely manner.

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LETTER FROM VEDA CAPITAL LIMITED

3. Potential dilution to the shareholdings of the public Shareholders

The table below illustrates the shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) immediately upon the allotment and issue of Shares by the Company pursuant to the Refreshed General Mandate (assuming the Refreshed General Mandate is utilised in full and no further Shares are issued or repurchased by the Company):

			(ii) Immediately upon
			the allotment and
			issue of Shares by the
			Company pursuant
			to the Refreshed General
			Mandate (assuming the
			Refreshed General Mandate
			is utilised in full and
			no further Shares are
	(i)As at the Latest		issued or repurchased
Shareholders	Practicable Date		by the Company)
	Number of Shares	%	Number of Shares	%
Wong Ka Man	210,526,315	25.30	210,526,315 21.08
Hua R Sheng Technology	60,000,000	7.21	60,000,000	6.01
Company Limited_(Note)_
Public Shareholders	561,739,974	67.49	561,739,974 56.24
Shares to be issued	–	–	166,453,257 16.67
under the Refreshed
General Mandate
Total	832,266,289	100.00	998,719,546 100.00

Note: The entire issued share capital of Hua R Sheng Technology Company Limited is wholly and beneficially owned by Mr. Yan Qiyu.

As illustrated in the above table, the shareholdings of the existing public Shareholders would decrease from approximately 67.49% as at the Latest Practicable Date to approximately 56.24% immediately upon the allotment and issue of Shares by the Company pursuant to the Refreshed General Mandate (assuming the Refreshed General Mandate is utilised in full and no further Shares are issued or repurchased by the Company) and the potential dilution to shareholdings of the existing Shareholders represents a dilution of approximately 16.67%.

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LETTER FROM VEDA CAPITAL LIMITED

Taken into account that the Refreshed General Mandate will (i) provide alternative means for the Company to raise capital; (ii) provide more options of financing to the Group for further development of its business as well as in other potential future investments as and when such opportunities arise; and (iii) the fact that the shareholding of the Shareholders will be diluted in proportion to their respective shareholdings upon any utilisation of the Refreshed General Mandate, we consider such potential dilution to the shareholdings of the public Shareholders to be justifiable.

RECOMMENDATION

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

Yours faithfully, For and on behalf of Veda Capital Limited Julisa Fong Managing Director

Notes: Ms. Julisa Fong is a licensed person under the SFO to engage in Type 6 (advising on corporate finance) regulated activity and has over 18 years of experience in investment banking and corporate finance.

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NOTICE OF EGM

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(incorporated in the Cayman Islands with limited liability) (Stock Code: 8226)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (“ Meeting ”) of Sunrise (China) Technology Group Limited (the “ Company ”) will be held at 10:00 a.m. on Tuesday, 6 October 2015 at Units 01-03, 28th Floor, Shui On Centre, 6-8 Harbour Road, Wan Chai, Hong Kong, for the purpose of considering and, if thought fit, passing the following resolution as an ordinary resolution of the Company:

ORDINARY RESOLUTION

• (1) “ THAT :

• (a) the general mandate granted to the directors of the Company (the “ Directors ”) to allot, issue and deal with the unissued shares of the Company pursuant to an ordinary resolution passed at the annual general meeting of the Company held on 8 May 2015 be and is hereby revoked (without prejudice to any valid exercise of such general mandate prior to the passing of this resolution);

• (b) subject to the following provisions of this resolution, the exercise by the Directors during the Relevant Period (as defined below) of all the powers of the Company to allot, issue and deal with additional shares in the share capital of the Company (“ Shares ”), and to make or grant offers, agreements and options (including warrants, bonds and debentures convertible into Shares) which would or might require the exercise of such powers, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

• (c) the approval in paragraph (b) of this resolution shall authorise the Directors during the Relevant Period (as defined below) to make or grant offers, agreements and options (including warrants, bonds and debentures convertible into Shares) which would or might require the exercise of such powers after the end of the Relevant Period (as defined below);

• (d) the aggregate nominal amount of share capital of the Company 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 paragraph (b) of this resolution, otherwise than pursuant to (i) a Rights Issue (as defined below); or (ii) the exercise of the conversion rights attaching to any convertible securities issued by the Company; (iii) the exercise of warrants to subscribe for Shares; (iv) the exercise of options granted under any share option scheme or similar arrangement for the time being adopted by the Company; or (v) an issue of Shares in lieu of the whole or part of a dividend on Shares in accordance with the articles of association of the Company (the “ Articles ”); shall not exceed 20% of the aggregate nominal amount of the share capital of the Company in issue as at the date of the passing of this resolution, and the said approval shall be limited accordingly; and

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NOTICE OF EGM

• (e) for the purposes of this resolution:

“ Relevant Period ” means the period from 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 law to be held; or

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

“ Rights Issue ” means an offer of Shares open for a period fixed by the Directors to the holders of Shares or any class of Shares whose names appear on the registers of members of the Company on a fixed record date in proportion to their then holdings of such Shares as at that date (subject to such exclusions 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).”

On behalf of the Board Sunrise (China) Technology Group Limited Ma Arthur On-hing Executive Director

Hong Kong, 14 September 2015

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

Head Office and Principal place of business in Hong Kong: Units 01-03 28th Floor Shui On Centre 6-8 Harbour Road Wan Chai, Hong Kong

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NOTICE OF EGM

Notes:

• (1) Any member of the Company entitled to attend and vote at the Meeting shall be entitled to appoint another person (who must be an individual) as his proxy to attend and vote instead of him and a proxy so appointed shall have the same right as the member to speak at the Meeting. A proxy need not be a member of the Company. A member may appoint any number of proxies to attend in his stead at the Meeting.

• (2) A form of proxy for use at the Meeting is enclosed. To be valid, the form of proxy must be duly completed in accordance with the instructions printed thereon and deposited, together with the power of attorney or other authority (if any) under which it is signed or a certified copy of such power of attorney or authority, at the Company’s branch share registrar and transfer office in Hong Kong, Union Registrars Limited at A18/F., Asia Orient Tower, Town Place, 33 Lockhart Road, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the Meeting or adjourned meeting.

• (3) Completion and delivery of the form of proxy will not preclude a member of the Company from attending and voting in person at the Meeting or any adjournment thereof should such member so wishes, and in such event, the instrument appointing a proxy shall be deemed revoked.

• (4) Where there are joint holders of any share of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he were solely entitled to vote, but if more than one of such joint holders are present at the meeting, the most senior holder shall alone be entitled to vote, whether in person or by proxy. For this purpose, seniority shall be determined by reference to the order in which the names of the joint holders stand first on the register of members of the Company in respect of the joint holding.

• (5) In compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited, the resolution to be proposed at the Meeting convened by this notice will be voted on by way of poll.

• As at the date of this notice, the Board comprises eight Directors namely Mr. Ma Arthur On-hing, Mr. Shan Biao, Mr. Mui Wai Sum and Ms. Kwan Kar Ching, being the executive Directors, Mr. Chen Wai Chung Edmund, being the non-executive Director, Mr. Ho Chun Kit Gregory, Mr. Ho Wai Shing and Mr. Hung Cho Sing, being the independent non-executive Directors.

This notice, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited 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 notice 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 notice misleading.

This notice will remain on the “Latest Company Announcements” page of the website of Growth Enterprise Market at www.hkgem.com for at least 7 days from the date of its publication and on the Company’s website at www.sunrisechina-tech.com.

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