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Lianlian DigiTech Co., Ltd. — Proxy Solicitation & Information Statement 2025
Apr 22, 2025
50703_rns_2025-04-22_64589f46-f865-406a-92ba-ece2ff8b219a.pdf
Proxy Solicitation & Information Statement
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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 what action to take in relation to this circular, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional public accountant or other professional adviser.
If you have sold or transferred all your shares in Lianlian DigiTech Co., Ltd., you should at once hand this circular, together with the enclosed proxy form, to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).
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.
LianLian 连连
Lianlian DigiTech Co., Ltd.
速速数字科技股份有限公司
(A joint stock company incorporated in the People's Republic of China with limited liability)
(Stock Code: 2598)
(1) 2024 REPORT OF THE BOARD
(2) 2024 REPORT OF THE SUPERVISORY COMMITTEE
(3) 2024 AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(4) 2024 ANNUAL REPORT
(5) ANNUAL LOSS RECOVERY PLAN
(6) APPLICATION FOR CREDIT LINES FROM BANKS AND OTHER FINANCIAL INSTITUTIONS AND PROVISION OF GUARANTEE IN FAVOUR OF WHOLLY-OWNED SUBSIDIARIES
(7) RE-APPOINTMENT OF AUDITORS FOR 2025
(8) GENERAL MANDATE TO ISSUE SHARES
(9) GENERAL MANDATE TO REPURCHASE SHARES AND NOTICE OF THE ANNUAL GENERAL MEETING
A notice convening the AGM of Lianlian DigiTech Co., Ltd. to be held on Friday, June 6, 2025 at 10:00 a.m. at the meeting room of the Company at 12/F, Block A, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC is set out on pages AGM-1 to AGM-3 of this circular. A proxy form for use at the AGM is also enclosed in this circular. Such proxy form is also published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.lianlian.com).
Shareholders who intend to appoint a proxy to attend the AGM shall complete and return the enclosed proxy form in accordance with the instructions printed thereon not less than 24 hours before the time fixed for holding the AGM or any adjournment thereof (as the case may be). Completion and return of the proxy form will not preclude Shareholders from attending and voting in person at the AGM or any adjourned meeting thereof if Shareholders so wish. For the avoidance of doubt, holders of Treasury Shares (if any) shall abstain from voting at the AGM.
April 23, 2025
CONTENTS
Page
DEFINITIONS ... 1
LETTER FROM THE BOARD ... 5
APPENDIX I - EXPLANATORY STATEMENT ON THE GENERAL
MANDATE ... 14
NOTICE OF THE ANNUAL GENERAL MEETING ... AGM-1
- i -
DEFINITIONS
In this circular, unless the context otherwise requires, the following expressions shall have the meanings set out below:
"2024 Annual Report"
the annual report of the Company for the year ended December 31, 2024, which has been published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.lianlian.com)
"2024 Audited Consolidated Financial Statements"
the audited consolidated financial statements of the Group for the year ended December 31, 2024, the full text of which is set out in the 2024 Annual Report
"2024 Report of the Board"
the report of Directors for the year ended December 31, 2024, the full text of which is set out in the 2024 Annual Report
"2024 Report of the Supervisory Committee"
the report of the Supervisory Committee for the year ended December 31, 2024, the full text of which is set out in the 2024 Annual Report
"AGM" or "Annual General Meeting"
the annual general meeting of the Company to be held on Friday, June 6, 2025 at 10:00 a.m. at the meeting room of the Company at 12/F, Block A, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC to consider and, if appropriate, to approve the resolutions contained in the notice of the meeting which is set out on pages AGM-1 to AGM-3 of this circular, or any adjournment thereof
"Articles of Association"
the articles of association of the Company currently in force
"Board"
the board of Directors of the Company
"China" or the "PRC"
the People's Republic of China, for the purpose of this circular and for geographical reference only, excluding Hong Kong Special Administrative Region of the People's Republic of China, Macau Special Administrative Region of the People's Republic of China and Taiwan Region
- 1 -
DEFINITIONS
| “Chuanglianzhixin” | Hangzhou Chuanglianzhixin Investment L.P. (杭州創建致新投資合夥企業(有限合夥)), a limited partnership established in the PRC on December 11, 2017, one of our Controlling Shareholders |
|---|---|
| “Company” | Lianlian DigiTech Co., Ltd. (連連數字科技股份有限公司), a joint stock company incorporated in the PRC with limited liability, the H Shares of which are listed on the Main Board of the Stock Exchange (stock code: 2598) |
| “Controlling Shareholder(s)” | has the meaning ascribed to it under the Listing Rules and in the context of this circular, refers to the controlling shareholders of our Company, namely Mr. Zhang Zhengyu (章微宇), Chuanglianzhixin, Mr. Lu Zhonglin (呂鐘霖) and Ms. Xiao Seqiu (肖瑟秋) |
| “Director(s)” | the director(s) of the Company |
| “Group” | the Company and its subsidiaries |
| “H Share(s)” | overseas listed foreign shares in the ordinary share capital of the Company with a nominal value of RMB1.00 each, which are subscribed for and traded in Hong Kong dollars and listed on the Main Board of the Stock Exchange |
| “H Shareholder(s)” | holders of H Share(s) |
| “HK$” or “Hong Kong dollars” | Hong Kong dollars, the lawful currency of Hong Kong |
| “Hong Kong” | the Hong Kong Special Administrative Region of the PRC |
| “Issue Mandate” | a general mandate to be granted to the Board to exercise the powers of the Company to allot, issue and/or deal with new Shares of the Company (including any sale or transfer of Treasury Shares), if permitted by the Listing Rules, not exceeding 20% of the aggregate number of the issued Shares of the Company (excluding Treasury Shares) at the date of passing the relevant resolution, subject to the conditions set out in the resolution to be proposed at the AGM for approving such general mandate |
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DEFINITIONS
"Latest Practicable Date"
April 17, 2025, 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 as amended or supplemented from time to time
"Repurchase Mandate"
a repurchase mandate to be granted to the Board to exercise the powers of the Company to repurchase the H Shares of the Company, if permitted by the Listing Rules, not exceeding 10% of the aggregate number of the H Shares in issue (excluding Treasury Shares) at the date of passing the relevant resolution, subject to conditions set out in the resolution to be proposed at the AGM for approving such repurchase mandate
"RMB" or "Renminbi"
Renminbi, the lawful currency of the PRC
"SAFE"
State Administration of Foreign Exchange of the PRC (中國國家外匯管理局)
"SFO"
the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong, as amended from time to time
"Share(s)"
ordinary shares in the share capital of the Company, with a nominal value of RMB1.00 each, comprising Unlisted Shares and H Shares
"Shareholder(s)"
holder(s) of Share(s)
"Stock Exchange"
The Stock Exchange of Hong Kong Limited
"Supervisor(s)"
supervisor(s) of the Company
"Supervisory Committee"
the supervisory committee of the Company
"Takeovers Code"
the Code on Takeovers and Mergers issued by the Securities and Futures Commission
"Treasury Shares"
has the meaning ascribed to it under the Listing Rules
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DEFINITIONS
"Unlisted Share(s)"
ordinary shares in the share capital of the Company, with a nominal value of RMB1.00 each, which are subscribed for and paid up in Renminbi and are unlisted shares which are currently not listed or traded on any stock exchange
"%
per cent
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LETTER FROM THE BOARD
LianLian 连连
Lianlian DigiTech Co., Ltd.
連連數字科技股份有限公司
(A joint stock company incorporated in the People's Republic of China with limited liability)
(Stock Code: 2598)
Executive Directors:
Mr. Zhang Zhengyu (章徵宇) (Chairman)
Mr. Xin Jie (辛潔)
Ms. Wei Ping (魏萍)
Mr. Zhu Xiaosong (朱曉松)
Mr. Wang Yu (王愚)
Independent Non-executive Directors:
Mr. Chun Chang
Mr. Wong Chi Kin (黃志堅)
Ms. Lin Lanfen (林蘭芬)
Registered office in the PRC:
B3, 12/F, Building 1
79 Yueda Lane
Binjiang District, Hangzhou
Zhejiang Province
PRC
Principal place of business in the PRC:
B3, 12/F, Building 1
79 Yueda Lane
Binjiang District, Hangzhou
Zhejiang Province
PRC
Principal place of business in Hong Kong:
46/F, Hopewell Centre
183 Queen's Road East
Wan Chai
Hong Kong
April 23, 2025
To the Shareholders:
Dear Sir or Madam,
(1) 2024 REPORT OF THE BOARD
(2) 2024 REPORT OF THE SUPERVISORY COMMITTEE
(3) 2024 AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(4) 2024 ANNUAL REPORT
(5) ANNUAL LOSS RECOVERY PLAN
(6) APPLICATION FOR CREDIT LINES FROM BANKS AND OTHER
FINANCIAL INSTITUTIONS AND PROVISION OF GUARANTEE
IN FAVOUR OF WHOLLY-OWNED SUBSIDIARIES
(7) RE-APPOINTMENT OF AUDITORS FOR 2025
(8) GENERAL MANDATE TO ISSUE SHARES
(9) GENERAL MANDATE TO REPURCHASE SHARES
AND
NOTICE OF THE ANNUAL GENERAL MEETING
1. INTRODUCTION
The purpose of this circular is to provide you with the notice of the AGM and the information reasonably necessary to enable you to make an informed decision on whether to vote for or against the proposed resolutions at the AGM.
LETTER FROM THE BOARD
At the AGM, ordinary resolutions will be proposed as follows:
(1) to consider and approve the 2024 Report of the Board;
(2) to consider and approve the 2024 Report of the Supervisory Committee;
(3) to consider and approve the 2024 Audited Consolidated Financial Statements;
(4) to consider and approve the 2024 Annual Report;
(5) to consider and approve the Annual Loss Recovery Plan;
(6) to consider and approve the application for credit lines from banks and other financial institutions and the provision of guarantee in favour of wholly-owned subsidiaries of the Company;
(7) to consider and approve the re-appointment of auditors for 2025, and to authorize the Board to fix their remuneration;
At the AGM, special resolutions will be proposed as follows:
(8) to consider and approve the proposal to grant the general mandate to issue shares to the Board; and
(9) to consider and approve the proposal to grant the general mandate to repurchase shares to the Board.
In order to enable you to have a better understanding of the resolutions to be proposed at the AGM and to make an informed decision in the circumstance where sufficient and necessary information is available, we have provided detailed information to Shareholders in this circular.
2. MATTERS TO BE RESOLVED AT THE AGM
Ordinary Resolutions
2.1 To consider and approve the 2024 Report of the Board
The full text of the 2024 Report of the Board is set out in the section headed "Report of Directors" in the 2024 Annual Report.
The 2024 Report of the Board was considered and approved by the Board on March 18, 2025 and is hereby proposed at the AGM for consideration and approval.
LETTER FROM THE BOARD
2.2 To consider and approve the 2024 Report of the Supervisory Committee
The full text of the 2024 Report of the Supervisory Committee is set out in the section headed “Report of Supervisory Committee” in the 2024 Annual Report.
The 2024 Report of the Supervisory Committee was considered and approved by the Supervisory Committee on March 18, 2025 and is hereby proposed at the AGM for consideration and approval.
2.3 To consider and approve the 2024 Audited Consolidated Financial Statements
The full text of the 2024 Audited Consolidated Financial Statements has been set out in the 2024 Annual Report.
The 2024 Audited Consolidated Financial Statements were considered and approved by the Board on March 18, 2025 and are hereby proposed at the AGM for consideration and approval.
2.4 To consider and approve the 2024 Annual Report
The 2024 Annual Report was considered and approved by the Board on March 18, 2025 and is hereby proposed at the AGM for consideration and approval.
2.5 To consider and approve the Annual Loss Recovery Plan (where necessary)
The Annual Loss Recovery Plan was considered and approved by the Board on March 18, 2025 and is hereby proposed at the AGM for consideration and approval.
2.6 To consider and approve the application for credit lines from banks and other financial institutions and the provision of guarantee in favour of wholly-owned subsidiaries of the Company
In order to meet the production, operation and business development needs of the Group in 2025, the Company and its subsidiaries (including wholly-owned subsidiaries and controlled subsidiaries) intend to apply to financial institutions for a credit line with a balance of no more than RMB2 billion (subject to the final credit line approved by financial institutions). The credit methods of financial institutions include but are not limited to: letter of guarantee, overdraft of legal person accounts, working capital loans, mortgage loans, merger and acquisition loans and other credit business varieties. The above-mentioned credit line does not equal to the actual financing amount of the Company. The specific financing amount will be determined based on the actual needs of the Company’s working capital, and the financing term will be subject to the actual signed contract.
LETTER FROM THE BOARD
The Company intends to provide mortgage, pledge and guarantee (if applicable) for the credit of financial institutions of its subsidiaries during the validity period of the above resolution at the general meeting. The specific guarantee content and guarantee period shall be subject to the guarantee contract actually signed.
In order to improve the efficiency of decision-making, the Company will propose to the AGM to authorize the management of the Company to handle specific business on behalf of the Company at their full discretion, including but not limited to signing contracts, agreements and other legal documents in relation to credit extension (including but not limited to credit extension, loan, financing, etc.). The authorization period will commence from the date of consideration and approval at the AGM to the date of convening the next annual general meeting of the Company. Within the authorization period, the comprehensive credit line can be recycled. The Board and the general meeting no longer review the single credit and loan business separately.
The above comprehensive credit facilities will be subject to certain agreements to be finally signed with the relevant banks and financial institutions, and may not be equal to the actual financing amount of the Company. The management of the Company will adjust the number of credit financial institutions based on the actual situation and adjust the credit lines among credit financial institutions. The Company will actively obtain credit resources from banks and other financial institutions in accordance with the principle of maximizing and appropriately adjusting; When used, it will be operated according to the conditions that meet the needs of the Company and are most favorable to the Company.
If the above matters involve connected transactions at that time, the Company shall perform separate review procedures for connected transactions.
2.7 To consider and approve the re-appointment of auditors for 2025 and to authorize the Board to fix their remuneration
PricewaterhouseCoopers (腰兵咸永道會計師事務所) will retire as the auditors of the Company with effect from the conclusion of the AGM and, being eligible, offer themselves for re-appointment.
The Board, upon the recommendation of the audit committee of the Company, proposed to re-appoint PricewaterhouseCoopers (腰兵咸永道會計師事務所) as the auditors of the Company for the year of 2025, to hold office until the conclusion of the next annual general meeting of the Company, and to authorize the Board to determine their remuneration.
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LETTER FROM THE BOARD
Special Resolutions
2.8 To consider and approve the general mandate to issue shares
In order to meet the capital requirements of the Company for its continuous business development, to utilise financing platforms effectively and flexibly and to take advantage of capital market windows in a timely manner, the Board intends to propose the Shareholders to, on the premise of compliance with the securities regulatory requirements of the place where the Shares of the Company are listed or other applicable laws and regulations, authorize the Board and its authorized persons, on a general basis, to decide to separately or concurrently allot, issue and/or deal with new Shares (including any sale or transfer of Treasury Shares), not exceeding 20% of the total number of the Shares in issue (excluding any Treasury Shares) of the Company as at the Latest Practicable Date.
As at the Latest Practicable Date, there were 660,391,236 Unlisted Shares and 418,668,764 H Shares in issue and the Company did not hold any treasury shares. Subject to the passing of the proposed special resolution approving the grant of the Issue Mandate to the Board and on the basis that no Shares will be issued by the Company prior to the AGM, a maximum of 215,812,000 Shares (including both Unlisted Shares and H Shares), can be separately or concurrently allotted, issued and/or dealt with by the Board (including any sale or transfer of Treasury Shares), pursuant to the Issue Mandate to be granted by the Shareholders.
The Issue Mandate will expire upon the earliest of:
(a) the passing of the relevant resolution by the next annual general meeting of the Company;
(b) the expiration of a 12-month period following the passing of the relevant resolution at the AGM; or
(c) the date on which the authority set out in this resolution is revoked or varied by a special resolution of the Shareholders in a general meeting.
A special resolution will be proposed at the AGM in relation to the granting of the Issue Mandate to the Directors to issue, allot and/or deal with additional Shares (including any sale or transfer of Treasury Shares), details of which are set out in special resolution numbered (8) of the notice of the AGM.
LETTER FROM THE BOARD
2.9 To consider and approve the general mandate to repurchase shares
According to the Company Law and the Articles of Association, the Company purchases its own shares under any of the following circumstances, it may, in accordance with the Articles of Association or the authorization of the shareholders' general meeting, make a resolution at a board meeting attended by more than two-thirds of the directors: (i) using the shares for employee stock ownership plan or equity incentive; (ii) using the shares for conversion of convertible corporate bonds issued by the Company; and (iii) when it is necessary for the Company to protect the company value and the shareholders' equity.
Where the Company acquires its shares due to the above circumstances, the acquisition shall be conducted through a public centralized trading, or through other means recognized by the laws, administrative regulations, the Listing Rules and the securities regulatory rules of the place where the Company's shares are listed, and the China Securities Regulatory Commission (the "CSRC").
After the Company acquires its shares in accordance with the above regulations, the cumulative Shares repurchased by the Company shall not exceed 10% of the total number of H Shares in issue (excluding Treasury Shares) and shall be transferred or deregistered within three years.
The Listing Rules permit shareholders of a joint stock limited company duly incorporated in the PRC to grant a general mandate to its directors to repurchase H shares of such company that are listed on the Stock Exchange. Such mandate is required to be given by way of a special resolution passed by shareholders in general meeting.
As the H Shares are traded on the Stock Exchange in Hong Kong dollars, the amount payable by the Company upon any repurchase of its H Shares will, therefore, be paid in Hong Kong dollars, the approvals of SAFE and other relevant government authorities are required for any repurchase of H Shares.
In accordance with the requirements of Article 177 of the Articles of Association applicable to capital reduction, the Company is required to prepare a balance sheet and a schedule of assets upon the reduction of its registered capital. The Company shall notify its creditors of the passing of such special resolution and the reduction of the registered capital of the Company that would occur should the Company decide to exercise the Repurchase Mandate. Such notification should be given in writing to the Company's creditors and be published by way of an announcement within 10 days and 30 days after the passing of such special resolution, respectively. Creditors then have a period of up to 30 days after receipt of the Company's written notification or if no such notification has been received, up to 45 days after the publication of the announcement to require the Company to repay amounts due to them or to provide guarantees thereof.
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LETTER FROM THE BOARD
The registered capital of the Company after the capital reduction shall not be lower than the statutory minimum level required by laws.
In order to ensure flexibility and discretion to the Directors in the event that it becomes desirable to repurchase any H Shares, approval is proposed to be sought from the Shareholders for the Repurchase Mandate. In accordance with the legal and regulatory requirements described above, the Directors have given notices to convene the AGM. At the AGM, a special resolution will be proposed to grant to the Directors the Repurchase Mandate, i.e. a conditional general mandate to repurchase H Shares up to a maximum of 10% of the total number of H Shares in issue (excluding Treasury shares) as at the Latest Practicable Date.
As at the Latest Practicable Date, there were 418,668,764 H Shares in issue and the Company did not hold any treasury shares. Subject to the passing of the proposed special resolution approving the grant of the Repurchase Mandate to the Board and on the basis that no Shares will be issued by the Company prior to the AGM, a maximum of 41,866,876 H Shares can be repurchased by the Board pursuant to the Repurchase Mandate to be granted by the Shareholders.
The Repurchase Mandate will be conditional upon:
(a) the passing of the special resolution approving the grant of the Repurchase Mandate at the AGM;
(b) the obtaining of the approvals of the relevant regulatory authorities as required by the laws, rules and regulations; and
(c) the compliance with the requirements by laws, regulations and the Articles of Association, including but not limited to Chapter 10 of the Listing Rules, and the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to any of them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount).
If the Company determines to repay any amount to any of its creditors in the circumstances described under condition (c) above, it expects to do so out of its internal generated fund. If the conditions are not fulfilled, the Repurchase Mandate will not be exercised by the Directors.
The Repurchase Mandate, if approved at the AGM, would expire on the earliest of:
(a) the conclusion of the next annual general meeting of the Company following the passing of the relevant resolution; or
(b) the expiration of a 12-month period following the passing of the relevant resolution at the AGM; or
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LETTER FROM THE BOARD
(c) the date on which the authority set out in the relevant resolutions approved at a general meeting is revoked or varied by special resolutions of the Shareholders in a general meeting.
An explanatory statement containing all relevant information relating to the Repurchase Mandate is set out in Appendix I to this circular. The information in the explanatory statement is to provide you with the information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolution to grant to the Directors the Repurchase Mandate.
A special resolution will be proposed at the AGM in relation to the grant of the Repurchase Mandate of H Shares to the Directors, details of which are set out in special resolution numbered (9) of the notice of the AGM.
3. AGM AND PROXY ARRANGEMENT
The proxy form of the AGM is enclosed herewith. Such proxy form is also published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.lianlian.com).
If you intend to appoint a proxy to attend the AGM, you are required to complete and return the accompanying proxy form in accordance with the instructions printed thereon. H Shareholders are required to return the proxy form to the Company's H Share registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong and Unlisted Shareholders are required to return the proxy form to the Company's principal place of business in the PRC at B3, 12/F, Building 1, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC by personal delivery or by post not less than 24 hours before the time fixed for holding the AGM or any adjourned meeting thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the AGM or at any adjourned meeting should you so wish.
4. VOTING BY POLL
According to Rule 13.39(4) of the Listing Rules, any vote of Shareholders at a general meeting must be taken by poll. Accordingly, the chairman of the AGM will exercise his power under the Articles of Association to demand a poll in relation to all the proposed resolutions at the AGM.
An ordinary resolution shall be passed by votes representing at least 1/2 of the voting rights held by the Shareholders (including proxies thereof) attending the AGM.
Special resolutions shall be passed by votes representing at least 2/3 of the voting rights held by the Shareholders (including proxies thereof) attending the AGM.
LETTER FROM THE BOARD
For the avoidance of doubt and for the purposes of the Listing Rules, holders of Treasury Shares (if any) shall abstain from voting on matters that require shareholders’ approval at the AGM.
To the best of the Directors’ knowledge, information and belief, none of the Shareholders is required to abstain from voting on the resolutions at the AGM.
5. CLOSURE OF REGISTER OF MEMBERS
For the purpose of determining the entitlement of the Shareholders to attend and vote at the Annual General Meeting, the register of members of the Company will be closed from Tuesday, June 3, 2025 to Friday, June 6, 2025 (both days inclusive), during which period no transfer of Shares will be registered. The record date for determining the entitlement of the Shareholders to attend and vote at the AGM will be Friday, June 6, 2025. Shareholders should lodge all completed transfer documents accompanies by the relevant share certificates to Computershare Hong Kong Investor Services Limited, the H Share Registrar of the Company at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong (for holders of H Shares), or to the Company’s registered office at B3, 12/F, Building 1, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC (for holders of Unlisted Shares) no later than 4:30 p.m. on June 2, 2025 for handling registration procedures.
6. RECOMMENDATION
The Board considers that the resolutions set out in the notice of the AGM are in the interests of the Company and its Shareholders as a whole. Accordingly, the Board recommends all Shareholders to vote in favour of such resolutions to be proposed at the AGM.
7. RESPONSIBILITY STATEMENT
This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, 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 statement herein misleading.
By order of the Board
Lianlian DigiTech Co., Ltd.
Zhang Zhengyu
Chairman
APPENDIX I
EXPLANATORY STATEMENT ON THE GENERAL MANDATE
In accordance with the Listing Rules, this appendix serves as the explanatory statement to provide you with requisite information reasonably necessary to enable you to make an informed decision on whether to vote for or against the special resolution(s) to be proposed at the AGM for the grant of the Repurchase Mandate to the Directors.
REASONS FOR REPURCHASE OF THE H SHARES
The Directors believe that the flexibility afforded by the Repurchase Mandate would be beneficial to and in the best interest of the Company and its Shareholders. Such repurchases may, depending on market conditions and funding arrangements at such time, lead to an enhancement of the net asset value per Share and/or earnings per Share. Such repurchases will only be made when the Directors believe that such repurchases will benefit the Company and its Shareholders.
REGISTERED CAPITAL
As at the Latest Practicable Date, the total registered share capital of the Company was RMB1,079,060,000 comprising 418,668,764 H Shares and 660,391,236 Unlisted Shares of RMB1.00 each, and the Company did not hold any treasury shares.
EXERCISE OF THE H SHARE REPURCHASE MANDATE
Subject to the passing of the relevant special resolution in relation to the grant of the H Share Repurchase Mandate to the Board proposed at the Annual General Meeting, the Board will be granted the H Share Repurchase Mandate until the earlier of: (a) the conclusion of the next annual general meeting of the Company following the passing of the relevant special resolution at the Annual General Meeting; (b) the expiration of a period of twelve months following the passing of the relevant special resolution at the Annual General Meeting; or (c) the date on which the authority conferred by the relevant special resolution is revoked or varied by a special resolution of the Shareholders at a general meeting (the "Relevant Period"). The exercise of the H Share Repurchase Mandate is subject to the approval of the relevant PRC regulatory authorities as required by the laws, rules and regulations of the PRC being obtained (if applicable).
In accordance with the Listing Rules, the Company will not repurchase H Shares if the purchase price is higher by 5% or more than the average closing market price for the 5 preceding trading days on which H Shares were traded on the Stock Exchange.
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APPENDIX I
EXPLANATORY STATEMENT ON THE GENERAL MANDATE
The exercise in full of the Repurchase Mandate (on the basis of 418,668,764 H Shares in issue as at the Latest Practicable Date and no H Shares will be allotted and issued or repurchased by the Company on or prior to the date of the Annual General Meeting) would result in a maximum of 41,866,876 H Shares that may be repurchased by the Company during the Relevant Period, being the maximum of 10% of the total number of H Shares in issue (excluding Treasury Shares) as at the Latest Practicable Date.
FUNDING OF REPURCHASES
In repurchasing its H Share, the Company intends to apply funds from the Company's internal resources (which may include surplus funds, retained profits and proceeds from the listing of H Shares on the Stock Exchange) legally available for such purpose in accordance with the Articles of Association and the laws of the PRC and/or any other applicable laws, as the case may be. The Company may not repurchase securities on the Stock Exchange for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange from time to time.
STATUS OF REPURCHASED OF H SHARES
Under the Listing Rules, if the Company purchases any H Shares pursuant to the Repurchase Mandate, the Company will either (i) cancel the H Shares repurchased and reduce the Company's registered capital by an amount equivalent to the aggregate nominal value of the H Shares so cancelled, and/or (ii) hold such H Shares in treasury, subject to market conditions and the Company's capital management needs at the relevant time any repurchases of H Shares are made.
To the extent that any Treasury Shares are deposited with Central Clearing and Settlement System ("CCASS") pending resale, the Company will adopt appropriate measures to ensure that it does not exercise any shareholders' rights or receive any entitlements which would otherwise be suspended under the applicable laws if those Shares were registered in the Company's own name as treasury shares. These measures may include approval by the Board that (i) the Company will not (or will procure its broker not to) give any instructions to Hong Kong Securities Clearing Company Limited to vote at general meetings for the Treasury Shares deposited with CCASS; and (ii) in the case of dividends or distributions, the Company will withdraw the Treasury Shares from CCASS, and either re-register them in its own name as treasury shares or cancel them, in each case before the record date for the dividends or distributions.
APPENDIX I
EXPLANATORY STATEMENT ON THE GENERAL MANDATE
H SHARES PRICES
The highest and lowest traded prices for H Shares recorded on the Stock Exchange during each of the twelve months preceding the Latest Practicable Date were as follows:
| Month | Highest prices
HK$ | Lowest prices
HK$ |
| --- | --- | --- |
| 2024 | | |
| April | 10.22 | 8.60 |
| May | 10.10 | 9.08 |
| June | 10.06 | 9.25 |
| July | 9.84 | 9.10 |
| August | 9.60 | 8.90 |
| September | 9.57 | 8.89 |
| October | 10.88 | 8.51 |
| November | 10.28 | 9.00 |
| December | 10.20 | 9.03 |
| 2025 | | |
| January | 10.60 | 8.19 |
| February | 10.38 | 6.66 |
| March | 12.10 | 6.50 |
| April (up to the Latest Practicable Date) | 7.00 | 5.50 |
EFFECT OF THE TAKEOVER CODE
If as a result of a share repurchase by the Company, a substantial shareholder's proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purpose of the Takeovers Code. Accordingly, a shareholder, or group of shareholders acting in concert, could obtain or consolidate control of the Company or become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.
As at the Latest Practicable Date, Mr. Zhang Zhengyu, whose interest in the Company are notifiable under Part XV (Disclosure of Interests) of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), held approximately 26.84% of the total number of issued Shares. In the event that the Directors exercised in full the power to repurchase H Shares in accordance with the terms of the Repurchase Mandate proposed at the AGM, the shareholding of Mr. Zhang Zhengyu would increase to approximately 27.93% of the total number of issued Shares. The Directors are not aware of any consequences which will arise under the Takeovers Code and/or any similar applicable law, as a result of any repurchases to be made under the Repurchase Mandate. Moreover, the Directors will not make share repurchase on the Stock Exchange if such repurchase would result in the requirements under Rule 8.08 of the Listing Rules not being complied with.
APPENDIX I
EXPLANATORY STATEMENT ON THE GENERAL MANDATE
None of the Directors nor, to the best of their knowledge, having made all reasonable enquiries, any of their close associates (as defined in the Listing Rules) presently intends to sell H Shares to the Company under the Repurchase Mandate in the event that the Repurchase Mandate is approved by the Shareholders and the conditions (if any) to which the Repurchase Mandate is subject are fulfilled.
The Company has not been notified by any core connected persons (as defined in the Listing Rules) of the Company that they have a present intention to sell any H Shares to the Company, or that they have undertaken not to sell any H Shares held by them to the Company in the event that the Repurchase Mandate is approved by its Shareholders and the conditions (if any) to which the Repurchase Mandate is subject are fulfilled.
SHARE REPURCHASE MADE BY THE COMPANY
No repurchase of H Shares has been made by the Company in the previous six months preceding the Latest Practicable Date (whether on the Stock Exchange or otherwise).
IMPACT OF REPURCHASES
An exercise of the Repurchase Mandate in full could have a material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the latest published audited accounts contained in the annual report of the Company for the year ended 31 December 2024) at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Repurchase Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital needs of the Company or the gearing level of the Company. The number of H Shares to be repurchased on any occasion and the price and other terms upon which the same are repurchased will be decided by the Directors at the relevant time having regarded to the circumstances then prevailing, in the best interests of the Company.
GENERAL
The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the powers of the Company to make repurchase under the Repurchase Mandate in accordance with the Listing Rules, the Articles of Association and the applicable laws, rules and regulations of the PRC.
To the best knowledge and belief of the Directors, neither the explanatory statement nor the proposed repurchase of Shares pursuant to the Repurchase Mandate has any unusual features.
- 17 -
NOTICE OF THE ANNUAL GENERAL MEETING
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this notice, 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 notice.
LianLian 连连
Lianlian DigiTech Co., Ltd.
連連數字科技股份有限公司
(A joint stock company incorporated in the People's Republic of China with limited liability)
(Stock Code: 2598)
NOTICE OF THE ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN THAT the annual general meeting (the "AGM") of Lianlian DigiTech Co., Ltd. (the "Company") will be held at the meeting room of the Company at 12/F, Block A, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC on Friday, June 6, 2025 at 10:00 a.m. for the purposes of considering and, if thought fit, approving the following resolutions. In this notice, unless the context otherwise requires, terms used herein shall have the same meanings as defined in the Company's circular dated April 23, 2025 (the "Circular").
ORDINARY RESOLUTIONS
- To consider and approve the 2024 Report of the Board.
- To consider and approve the 2024 Report of the Supervisory Committee.
- To consider and approve the 2024 Audited Consolidated Financial Statements.
- To consider and approve the 2024 Annual Report.
- To consider and approve the Annual Loss Recovery Plan.
- To consider and approve the application for credit lines from banks and other financial institutions and the provision of guarantee in favour of wholly-owned subsidiaries of the Company.
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To consider and approve the re-appointment of PricewaterhouseCoopers (羅兵咸永道會計師事務所) as the auditor of the Company for 2025, for a term until the conclusion of the next annual general meeting of the Company, and to authorize the Board to fix their remuneration.
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AGM-1 -
NOTICE OF THE ANNUAL GENERAL MEETING
SPECIAL RESOLUTIONS
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To consider and approve the proposal to grant the general mandate to issue shares to the Board.
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To consider and approve the proposal to grant the general mandate to repurchase shares to the Board.
By order of the Board
Lianlian DigiTech Co., Ltd.
Zhang Zhengyu
Chairman
Hong Kong, April 23, 2025
As at the date of this notice, the board of directors of the Company comprises Mr. Zhang Zhengyu, Mr. Xin Jie, Ms. Wei Ping, Mr. Zhu Xiaosong and Mr. Wang Yu as executive directors, Mr. Chun Chang, Mr. Wong Chi Kin and Ms. Lin Lanfen as independent non-executive directors.
- AGM-2 -
NOTICE OF THE ANNUAL GENERAL MEETING
Notes:
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For further details of resolutions, please refer to the circular of the Company dated April 23, 2025.
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All resolutions at the AGM will be taken by poll pursuant to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"). The results of the poll will be published on the websites of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") (www.hkexnews.hk) and the Company (www.lianlian.com) in accordance with the Listing Rules. For the avoidance of doubt and for the purposes of the Listing Rules, holders of treasury shares of the Company (if any) are not entitled to vote at the AGM.
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All Shareholders are eligible for attending the AGM. Any Shareholder of the Company entitled to attend and vote at the AGM convened by the above notice is entitled to appoint a proxy or more than one proxy to attend the AGM and vote instead of him/her. A proxy need not be a Shareholder. If more than one proxy is appointed, the number of Shares in respect of which each such proxy so appointed must be specified in the relevant proxy form. Every Shareholder present in person or by proxy shall be entitled to one vote for each Share held by him/her.
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In order to be valid, the proxy form together with the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy thereof, must be completed and returned to (i) the Company's principal place of business in the People's Republic of China (the "PRC") at B3, 12/F, Building 1, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC (for Unlisted Shareholders) or (ii) the Company's H Share Registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong (for H Shareholders) not less than 24 hours before the time appointed for the AGM. Completion and return of the proxy form will not preclude a Shareholder from attending and voting at the AGM or any adjourned meeting thereof should he/she so wish.
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For the purpose of determining the Shareholders' eligibility to attend and vote at the AGM (and any adjourned meeting thereof), the register of members of the Company will be closed from Tuesday, June 3, 2025 to Friday, June 6, 2025, both days inclusive, during which period no transfer of the Shares will be registered. The record date for determining the entitlement of the Shareholders to attend and vote at the AGM will be Friday, June 6, 2025. Shareholders should lodge all completed transfer documents accompanies by the relevant share certificates to Computershare Hong Kong Investor Services Limited, the H Share Registrar of the Company at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong (for holders of H Shares), or to the Company's registered office at B3, 12/F, Building 1, 79 Yueda Lane, Binjiang District, Hangzhou, Zhejiang Province, PRC (for holders of Unlisted Shares) no later than 4:30 p.m. on June 2, 2025 for handling registration procedures.
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The AGM is expected to take no more than half a day. Shareholders who attend the AGM (in person or by proxy) shall bear their own travelling and accommodation expenses.
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Shareholders who are entitled to attend and vote at the AGM may appoint one or more proxies to attend and vote on their behalf. A proxy need not be a Shareholder.
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Shareholders or their proxies shall provide their identification documents when attending the AGM. In case of a corporate Shareholder, its proxy or other person authorized to attend the meeting with a resolution passed by the board of directors or other decision-making authorities of such corporate Shareholder, should provide a copy of such resolution.
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In case of joint holders, the vote of the senior joint Shareholder who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the votes of the other joint Shareholder(s) and for this purpose seniority will be determined by the order in which the names stand on the register of members of the Company in respect of the joint shareholding.
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AGM-3 -