Luzhou Xinglu Water (Group) Co., Ltd. — Proxy Solicitation & Information Statement 2021

Dec 12, 2021

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 a stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Luzhou Xinglu Water (Group) Co., Ltd., you should at once hand this circular, together with the accompanying form of proxy and reply slip to the purchaser or the transferee, or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or 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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(a joint stock company incorporated in the People’s Republic of China with limited liability) (Stock code: 2281)

(1) PROPOSED CHANGE OF INTERNATIONAL AUDITOR; (2) PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

(3) NOTICE OF 2021 SECOND EXTRAORDINARY GENERAL MEETING

A letter from the Board is set out on pages 4 to 8 of this circular. Notice of convening the EGM to be held at the meeting room of 6th Floor, 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the PRC at 9:30 a.m. on Tuesday, 28 December 2021 is set out on pages 9 to 11 of this circular.

Form of proxy for use at the EGM are also enclosed with this circular. If you intend to attend the EGM by proxy, you are required to complete and return the enclosed form(s) of proxy in accordance with the instructions printed thereon to the H share registrar of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong (in respect of H Shareholders), or to the office of the Board located at the Company’s registered office in the PRC at 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the PRC (in respect of Domestic Shareholders) as soon as possible but in any event by not later than 24 hours before the time appointed for holding of the EGM (i.e. not later than 9:30 a.m. on Monday, 27 December 2021) or any adjournment thereof. Completion and return of the form(s) of proxy shall not preclude you from attending and voting in person at the EGM or any adjourned meeting(s) if you so wish.

• For identification purposes only

10 December 2021

CONTENTS

	Page
PRECAUTIONARY MEASURES FOR THE EGM . . . . . . . . . . . . . . . . . . . . . . . .	1
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
LETTER FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
NOTICE OF THE EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9

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PRECAUTIONARY MEASURES FOR THE EGM

In view of the current development of the Novel Coronavirus (“ COVID-19 ”), the Company will implement the following measures at its EGM;

• (i) All participants (including Shareholders or their proxy) in the EGM are required to wear appropriate face masks at all times during their attendance.

• (ii) No refreshments will be served, and there will be no corporate gifts. Seating will be arranged to ensure adequate physical distancing between attendees in order to reduce person-to-person contact.

To the extent permitted under the laws of the PRC, the Company reserves the right to deny entry into the EGM venue or require any person to leave the EGM venue in order to ensure the safety of the attendees at the EGM.

Although Shareholders are welcome to attend in person to vote at the EGM, the Company reminds all Shareholders that physical attendance in person at the EGM is not necessary for the purpose of exercising voting rights. As an alternative, by using proxy forms with voting instructions inserted, Shareholders may appoint the Chairman of the EGM as their proxy to vote on the relevant resolutions at the EGM instead of attending in person. The proxy form will be despatched to the Shareholders and can be downloaded from the websites of the Stock Exchange and the Company.

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DEFINITIONS

Unless the context otherwise requires, the following expressions in this circular shall have the meanings set out below:

• “Articles of Association”

the articles of the Company as amended, modified or otherwise supplemental from time to time

• “Board” the board of Directors

• “CABSE” China Accounting Standards for Business Enterprises

• “Chairman” the chairman of the Board

• “Company”

Luzhou Xinglu Water (Group) Co., Ltd.*（瀘州市興瀘水 務（集團）股份有限公司）, a joint stock company with limited liability incorporated in the PRC, whose H Shares are listed on the Main Board of the Stock Exchange

• “Director(s)” the director(s) of the Company

• “Domestic Share(s)”

• the ordinary share(s) in the capital of the Company with a nominal value of RMB1.00 each, which are subscribed for or credited as paid up in RMB by PRC nationals and/or PRC legal entities

• “Domestic Shareholder(s)” the holder(s) of Domestic Shares

• “EGM”

• the 2021 second extraordinary general meeting of the Company to be convened and held at 9:30 a.m. on Tuesday, 28 December 2021

• “Group” the Company and its subsidiaries

• “H Share(s)”

• the overseas listed foreign invested ordinary share(s) in the capital of the Company with a nominal value of RMB1.00 each, which are subscribed for and traded in HK$ and listed on the Stock Exchange

• “H Shareholder(s)”

the holder(s) of H Shares

• “HK$”

• Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the PRC

• “IFRS”

the International Financial Reporting Standards issued by the International Accounting Standards Board

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DEFINITIONS

“Listing Rules”	the Rules Governing the Listing of Securities on	the
	Stock Exchange, as amended, supplemented	or
	otherwise modified from time to time
“PRC”	the People’s Republic of China, for the purposes of	this
	circular, excluding Hong Kong, the Macau Special
	Administrative Region of the PRC and Taiwan
“RMB”	Renminbi, the lawful currency of the PRC
“Share(s)”	the Domestic Share(s) and the H Share(s)
“Shareholder(s)”	the holder(s) of the Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited

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LETTER FROM THE BOARD

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(a joint stock company incorporated in the People’s Republic of China with limited liability) (Stock code: 2281)

Executive Directors: Mr. ZHANG Qi（張歧先生） Mr. LIAO Xingyue（廖星樾先生）

Non-executive Directors: Mr. CHEN Bing（陳兵先生） Ms. XU Yan（徐燕女士） Mr. XIE Xin（謝欣先生）

Independent non-executive Directors: Mr. GU Ming’an（辜明安先生） Mr. LIN Bing（林兵先生） Mr. CHENG Hok Kai, Frederick（鄭學啟先生）

Registered office: 16 Baizi Road Jiangyang District, Luzhou Sichuan Province The PRC

Principal place of business in Hong Kong: 40th Floor, Dah Sing Financial Centre No. 248 Queen’s Road East Wan Chai, Hong Kong

10 December 2021

To the Shareholders,

Dear Sir/Madam,

(1) PROPOSED CHANGE OF INTERNATIONAL AUDITOR; (2) PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

(3) NOTICE OF 2021 SECOND EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the announcement of the Company dated 9 December 2021 (the “ Announcement ”) in relation to (i) a proposal on the change of the Company’s accounting standards; (ii) a proposal on change of the Company’s international auditor; and (iii) a proposal on amendments to the articles of association of the Company (the “ Articles of Association ”) approved at the Board meeting convened on 9 December 2021. The purpose of this circular is to give you notice of the EGM and to provide you with information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolutions to be proposed at the EGM as set out below.

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LETTER FROM THE BOARD

At the EGM, an ordinary resolution will be proposed to consider and approve the proposed change of the international auditor of the Company, and a special resolution will be proposed to consider and approve the proposed amendments to the Articles of Association.

PROPOSED CHANGE OF INTERNATIONAL AUDITOR

Deloitte Touche Tohmatsu has been acting as the Company’s international auditor since the listing of H Shares on the Main Board of the Stock Exchange, being responsible for auditing the consolidated financial statements of the Group prepared in accordance with the IFRS. In view of the change of the accounting standards of the consolidated financial statements of the Group for reporting under the Listing Rules, the Board proposed to change the Company’s international auditor from Deloitte Touche Tohmatsu to ShineWing Certified Public Accountants LLP (the “ Proposed Change of International Auditor ”), subject to the approval of the Shareholders at the general meeting of the Company. ShineWing Certified Public Accountants LLP is recognized by the Ministry of Finance of the People’s Republic of China and the China Securities Regulatory Commission and is qualified to serve as the reporting accountant for mainland incorporated companies listed in Hong Kong. Subject to the approval of the Shareholders at the general meeting of the Company on the Proposed Change of the International Auditor, ShineWing Certified Public Accountants LLP will become the sole auditor of the Company auditing the consolidated financial statements of the Group prepared in accordance with CASBE, and also undertake the role of international auditor of the Company.

Deloitte Touche Tohmatsu has confirmed in writing that there are no matters relating to the Proposed Change of International Auditor that need to be brought to the attention of the Shareholders. The Board also confirms that it is not aware of any matters relating to the Proposed Change of International Auditor that need to be brought to the attention of the Shareholders. The Board and the audit committee of the Company also confirm that there is no disagreement between the Company and Deloitte Touche Tohmatsu in relation to the Proposed Change of International Auditor.

The Board would like to take this opportunity to express its sincere gratitude to Deloitte Touche Tohmatsu for its professional services rendered to the Group during the past years.

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

Due to the change of accounting standards as mentioned in the Announcement, the Company proposes to make corresponding amendments to certain provisions in relation to accounting standards in the Articles of Association (the “ Proposed Amendments to the Articles of Association ”).

The Proposed Amendments to the Articles of Association are compared against the existing Articles of Association as follows for ease of reference.

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LETTER FROM THE BOARD

Before Amendment After Amendment Article 227 The financial statements of Article 227 The financial statements of the Company shall be prepared in the Company shall be prepared in accordance with PRC accounting accordance with PRC accounting standards and regulations, and shall also standards and regulations ~~, and shall also~~ be prepared in accordance with the ~~be prepared in accordance with the~~ international accounting standards or the ~~international accounting standards or the~~ accounting standards of the place ~~accounting standards of the place outside~~ outside the PRC where the shares of the ~~the PRC where the shares of the~~ Company are listed. If there is any ~~Company are listed. If there is any~~ material discrepancy in the financial ~~material discrepancy in the financial~~ statements prepared in accordance with ~~statements prepared in accordance with~~ these two sets of accounting standards, ~~these two sets of accounting standards,~~ such discrepancy shall be specified in ~~such discrepancy shall be specified in the~~ the notes to such financial statements. ~~notes to such financial statements. For~~ For the purpose of distributing after-tax ~~the purpose of distributing after-tax~~ profits by the Company for a given ~~profits by the Company for a given~~ accounting year, the lesser of the ~~accounting year, the lesser of the amounts~~ amounts of after-tax profits shown in ~~of after-tax profits shown in the~~ the aforementioned two kinds of ~~aforementioned two kinds of financial~~ financial statements shall govern. ~~statements shall govern~~ . Article 228 Interim results or financial Article 228 Interim results or financial information published or disclosed by information published or disclosed by the the Company shall be prepared Company shall be prepared according to according to PRC accounting standards PRC accounting standards and and regulations, and shall also be regulations ~~, and shall also be prepared in~~ prepared in accordance with ~~accordance with international accounting~~ international accounting standards or the ~~standards or the accounting standards of~~ accounting standards of the place ~~the place outside the PRC where the~~ outside the PRC where the shares of the ~~shares of the Company are listed~~ . Company are listed.

The English version of the Proposed Amendments to the Articles of Association is an unofficial translation of its Chinese version for reference purpose only. In case of any discrepancies, the Chinese version shall prevail.

EXTRAORDINARY GENERAL MEETING

The EGM will be held at 9:30 a.m. on Tuesday, 28 December 2021 at the meeting room of 6th Floor, 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the PRC. The notice of the EGM is set out on pages 9 to 11 of this circular. The form of proxy and reply slip for the EGM are enclosed herewith.

Whether or not you are able to attend the EGM, you are advised to complete and return as soon as possible the enclosed form of proxy in accordance with the instructions printed thereon. The form of proxy for H Shareholders should be returned to the Company’s H share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited, at

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LETTER FROM THE BOARD

17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, and the form of proxy for Domestic Shareholders should be returned to the office of the Board located at 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the PRC by no later than 24 hours before the time appointed for convening the EGM (i.e. not later than 9:30 a.m. on Monday, 27 December 2021) or any adjourned meeting thereof. Completion and return of the form of proxy will not preclude you from attending and voting at the EGM, or any adjourned meeting, in person if you so wish.

If you intend to attend the EGM in person, you are required to complete and return the reply slip to the Company’s H share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited (for H Shareholders) or to the office of the Board (for Domestic Shareholders) on or before Saturday, 25 December 2021 for the Company to assess whether or not it is necessary to announce the notice of the EGM again. If the number of voting Shares as represented by the reply slips collected by Saturday, 25 December 2021 reaches no less than one half of the total number of the issued Shares, the Company may hold the EGM as stipulated in the notice of the EGM. If not, the Company shall within five days notify the Shareholders again, by public notice or otherwise required in the Articles of Association, of the matters to be considered as well as the date and place of the EGM. Upon such notification, the Company may hold the EGM.

CLOSURE OF REGISTER OF MEMBERS

In order to determine the entitlement to attend and vote at the EGM, the register of members of the Company will be closed from Saturday, 25 December 2021 to Tuesday, 28 December 2021 (both days inclusive), during which period no transfer of Shares will be effected. The record date for entitlement to attend and vote at the EGM is Saturday, 25 December 2021. In order to be qualified to attend and vote at the EGM, all transfers accompanied by the relevant share certificates must be lodged with the H share registrar of the Company, namely Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong (in respect of H Shareholders), or to the office of the Board located at the Company’s registered office in the PRC at 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the PRC (in respect of Domestic Shareholders) no later than 4:30 p.m. on Friday, 24 December 2021.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, the resolutions to be proposed at the EGM as set out in the notice of the EGM set out at the end of this circular must be taken by poll. The Chairman of the EGM will therefore demand a poll for every such resolution put to the vote at the EGM. On a poll, every Shareholder present in person or by proxy or (being a corporation) by its duly authorized representative shall have one vote for each Share registered in his or her name in the register of Shareholders. A Shareholder entitled to more than one vote need not use all his or her votes or cast all the votes he or she uses in the same way.

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LETTER FROM THE BOARD

RECOMMENDATION

The Board considers that all resolutions set out in the notice of the EGM for Shareholders’ consideration and approval are in the best interests of the Company and its Shareholders. As such, the Board recommends the Shareholders to vote in favor of the resolutions set out in the notice of the EGM which are to be proposed at the EGM.

By order of the Board Luzhou Xinglu Water (Group) Co., Ltd.* Zhang Qi Chairman

• For identification purposes only

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NOTICE OF THE EGM

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(a joint stock company incorporated in the People’s Republic of China with limited liability) (Stock code: 2281)

NOTICE OF 2021 SECOND EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the 2021 second extraordinary general meeting (the “ EGM ”) of Luzhou Xinglu Water (Group) Co., Ltd. (the “ Company ”) will be held at 9:30 a.m. on Tuesday, 28 December 2021 at the meeting room of 6th Floor, 16 Baizi Road, Jiangyang District, Luzhou, Sichuan Province, the People’s Republic of China (the “ PRC* ”) to consider and, if thought fit, approve the following resolutions:

ORDINARY RESOLUTION

1. To consider and approve the proposal on change of the Company’s international auditor from Deloitte Touche Tohmatsu to ShineWing Certified Public Accountants LLP for the year 2021 to hold office until the conclusion of the next annual general meeting of the Company and to authorize the board of directors of the Company to fix their remuneration; and

SPECIAL RESOLUTION

1. To consider and approve the proposal on amendments to the articles of association of the Company.

By order of the Board Luzhou Xinglu Water (Group) Co., Ltd.* Zhang Qi Chairman

Luzhou, Sichuan Province, the PRC 10 December 2021

Notes:

1. Pursuant to the Rules Governing the Listing of Securities (the “ Listing Rules ”) on the Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”), voting on all resolutions at a general meeting shall be by way of poll. The poll results of the EGM will be published on the websites of the Stock Exchange and the Company in accordance with the requirements of the Listing Rules.

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NOTICE OF THE EGM

1. For the purpose of ascertaining eligibility to attend and vote at the EGM, the register of members of the Company will be closed from Saturday, 25 December 2021 to Tuesday, 28 December 2021 (both dates inclusive) during which registration for transfer of shares will be suspended. Holders of H shares of the Company who intend to attend and vote at the EGM shall deliver all transfer forms together with the relevant share certificates to the Company’s H share registrar, Computershare Hong Kong Investor Services Limited, no later than 4:30 p.m. on Friday, 24 December 2021.

2. Any shareholder of the Company (the “ Shareholder ”) who is entitled to attend and vote at the EGM may appoint one or more proxies to attend and vote on his/her behalf. A proxy needs not be a Shareholder. If the Shareholder appoints more than one proxy, his/her proxies may only vote by poll.

3. The instrument appointing a proxy shall be in writing under the hand of the appointor or his/her attorney duly authorized in writing. If the Shareholder is a legal entity, then the relevant appointing document must be either under seal or under the hand of its director or attorney duly authorized. If the instrument appointing a proxy is signed by a person duly authorized by the Shareholder, the powers of attorney or other instruments of authorization shall be notarized.

4. The form of proxy together with the power of attorney or other authorization documents, if any, must be delivered to the office of the Board located at the registered office of the Company in the PRC (for holders of domestic shares of the Company) or the Company’s H share registrar, Computershare Hong Kong Investor Services Limited (for holders of H shares of the Company) not later than 24 hours before the time appointed for the holding of the EGM (i.e. not later than 9:30 a.m. on Monday, 27 December 2021) or any adjourned meeting thereof (as the case may be) in order to be effective.

5. Any Shareholder who wishes to attend the EGM in person or by proxy is required to complete and return the reply slip to the office of the Board located at the registered office of the Company in the PRC (for holders of domestic shares of the Company) or to the Company’s H share registrar, Computershare Hong Kong Investor Services Limited (for holders of H shares of the Company), by hand or by post, on or before Saturday, 25 December 2021.

6. The H share registrar of the Company in Hong Kong is Computershare Hong Kong Investor Services Limited and its address and contact information are as follows:

Shops 1712-1716, 17th Floor Hopewell Centre 183 Queen’s Road East Wan Chai, Hong Kong

Tel: (+852) 2862 8686 Fax: (+852) 3186 2419

1. The address and contact information of the office of the Board located at the registered office of the Company in the PRC are as follows:

16 Baizi Road, Jiangyang District, Luzhou Sichuan Province The PRC

Contact person: Zhang Hailiang（張海良） Tel: +86 (830) 319 4768 Fax: +86 (830) 258 0239

1. Pursuant to the articles of association of the Company, for joint registered Shareholders consisting of two or more persons, only the Shareholder whose name appears first on the register of members of the Company is entitled to receive this notice, attend the EGM and exercise the entire voting rights conferred by the relevant shares of the Company, and this notice shall be deemed to have served all such joint registered Shareholders.

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NOTICE OF THE EGM

1. The EGM is expected to last for no more than half a day. Shareholders who attend the EGM in person or their proxies shall be responsible for their own travelling and accommodation expenses. Shareholders or their proxies who attend the EGM must produce their identity documents for identification.

2. In view of the ongoing COVID-19 pandemic, the Company strongly recommends Shareholders to exercise their voting rights by appointing the chairman of the EGM as their proxy to vote on the relevant resolutions at the EGM as an alternative to attending the meeting in person.

The following prevention and control measures will be implemented at the EGM in order to cooperate with the prevention and control of the pandemic so as to safeguard the health and safety of the Shareholders and the participants of the meeting:

• (a) Compulsory body temperature check will be conducted for every Shareholder or proxy at the entrance of the venue. Any person with abnormal body temperature will not be admitted to the venue;

• (b) Every Shareholder or proxy is required to wear surgical facial mask throughout the meeting;

• (c) No refreshment will be served; and

• (d) No souvenirs will be distributed.

As at the date of this notice, the Board comprises of (i) two executive directors, namely Mr. Zhang Qi and Mr. Liao Xingyue (ii) three non-executive directors, namely Mr. Chen Bing, Ms. Xu Yan and Mr. Xie Xin; and (iii) three independent non-executive directors, namely Mr. Gu Ming’an, Mr. Lin Bing and Mr. Cheng Hok Kai, Frederick.

• For identification purposes only

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