Newton Resources Ltd — AGM Information 2018

Apr 18, 2018

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, a bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Newton Resources Ltd, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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: 1231)

PROPOSALS FOR RE-ELECTION OF RETIRING DIRECTORS, GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE NEW SHARES AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening the Annual General Meeting of the Company to be held at Meeting Room S428 (Harbour Road Entrance), Hong Kong Convention and Exhibition Centre, 1 Expo Drive, Wanchai, Hong Kong on Wednesday, 23 May 2018 at 11:45 a.m. is set out on pages 19 to 22 of this circular. A form of proxy for use at the Annual General Meeting is also enclosed with this circular. Such form of proxy is also published on the websites of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) and the Company (www.newton-resources.com).

If you are not able to attend the Annual General Meeting, please complete and sign the enclosed form of proxy in accordance with the instructions printed thereon and return it to the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the Annual General Meeting (i.e. at or before 11:45 a.m. on Monday, 21 May 2018 (Hong Kong time)) or any adjournment thereof. Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the Annual General Meeting or any adjournment thereof if they so wish and, in such event, the form of proxy shall be deemed to be revoked.

19 April 2018

CONTENTS

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Re-election of Retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
General Mandates to Repurchase Shares and Issue New Shares. . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Annual General Meeting and Proxy Arrangement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Responsibility Statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Recommendation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
APPENDIX I – DETAILS OF THE RETIRING DIRECTORS
STANDING FOR RE-ELECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
APPENDIX II – EXPLANATORY STATEMENT FOR
THE SHARE REPURCHASE MANDATE . . . . . . . . . . . . . . . . . . . . . .	13
NOTICE OF ANNUAL GENERAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19

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DEFINITIONS

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

“2017 AGM”

the annual general meeting of the Company held on 23 May 2017

“Annual General Meeting” the annual general meeting of the Company to be held at or “AGM” Meeting Room S428 (Harbour Road Entrance), Hong Kong Convention and Exhibition Centre, 1 Expo Drive, Wanchai, Hong Kong on Wednesday, 23 May 2018 at 11:45 a.m., to consider and, if appropriate, to approve the resolutions contained in the notice of the AGM which is set out on pages 19 to 22 of this circular, or any adjournment thereof

“Articles” the articles of association of the Company “Board” the board of Directors “close associates” has the meaning ascribed thereto under the Listing Rules “Company” Newton Resources Ltd, a company incorporated in the Cayman Islands with limited liability, and the Shares of which are listed on the main board of the Stock Exchange “Controlling Shareholder” has the meaning ascribed thereto under the Listing Rules “core connected person(s)” has the meaning ascribed thereto under the Listing Rules “Director(s)” the director(s) of the Company “Group” the Company and its subsidiaries “HK$” Hong Kong dollar, the lawful currency of Hong Kong “Hong Kong” the Hong Kong Special Administrative Region of the PRC “Latest Practicable Date” 13 April 2018, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

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DEFINITIONS

“PRC” The People’s Republic of China for the purpose of this circular, excluding Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan “RMB” Renminbi, the lawful currency of the PRC “SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “Shares(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company

“Share Issuance Mandate” a general mandate proposed to be granted to the Directors at the AGM to exercise the power of the Company to allot, issue or deal with the Shares during the period and in the manner as set out in item 8(2) of the notice of the AGM not exceeding 20% of the total number of issued Shares of the Company as at the date of passing such proposed ordinary resolution

“Share Repurchase Mandate” a general mandate proposed to be granted to the Directors at the AGM to exercise the power of the Company to repurchase the Shares during the period and in the manner as set out in item 8(1) of the notice of the AGM not exceeding 10% of the total number of issued Shares of the Company as at the date of passing such proposed ordinary resolution “Shareholder(s)” holder(s) of the Share(s) “Stock Exchange” The Stock Exchange of Hong Kong Limited “Substantial Shareholder” has the meaning ascribed thereto under the Listing Rules “Takeovers Code” The Code on Takeovers and Mergers “%” per cent

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LETTER FROM THE BOARD

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(Incorporated in the Cayman Islands with limited liability) (Stock Code: 1231)

Executive Directors:

Mr. Chong Tin Lung, Benny (Chairman) Mr. Li Changfa Mr. Luk Yue Kan

Registered Office:

P.O. Box 309 Ugland House Grand Cayman, KY1-1104 Cayman Islands

Non-executive Director:

Mr. Wu Wai Leung, Danny

Independent Non-executive Directors:

Mr. Tsui King Fai Mr. Lee Kwan Hung Mr. Shin Yick, Fabian

Principal Place of Business in Hong Kong: Room 1505 15th Floor, New World Tower 16-18 Queen’s Road Central Central, Hong Kong

19 April 2018

To the Shareholders

Dear Sir/Madam,

PROPOSALS FOR RE-ELECTION OF RETIRING DIRECTORS, GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE NEW SHARES AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information in respect of certain resolutions to be proposed at the AGM for (i) the re-election of the retiring Directors; (ii) the granting of the Share Repurchase Mandate and the Share Issuance Mandate to repurchase Shares and to issue new Shares respectively, and to give you notice of the AGM.

RE-ELECTION OF RETIRING DIRECTORS

In accordance with the articles 106(1) and 106(2) of the Articles, Messrs. Wu Wai Leung, Danny, Shin Yick, Fabian and Li Changfa shall retire from their office by rotation at the AGM. In addition, pursuant to article 101(3) of the Articles, Mr. Chong Tin Lung, Benny, who has been appointed by the Board as an executive Director and the chairman of the Board with effect from 9 April 2018, will retire at the AGM. All the above retiring Directors, being eligible, shall offer themselves for re-election as the Directors at the AGM.

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LETTER FROM THE BOARD

Mr. Shin Yick, Fabian, independent non-executive Directors, has confirmed his independence with reference to the factors set out in Rule 3.13 of the Listing Rules. The Company considers Mr. Shin Yick, Fabian is still independent in accordance with the independence guideline as set out in the Listing Rules and will continue to bring valuable business experience, knowledge and professionalism to the Board for its efficient and effective functioning.

Details of these retiring Directors who are proposed to be re-elected at the AGM are set out in Appendix I to this circular.

GENERAL MANDATES TO REPURCHASE SHARES AND ISSUE NEW SHARES

At the 2017 AGM, general mandates were granted to the Directors to exercise the powers of the Company to repurchase Shares and issue new Shares respectively. Such mandates, to the extent not used by the date of AGM, will lapse at the conclusion of the AGM. In order to give the Directors the flexibility and discretion to exercise the powers of the Company to repurchase Shares and to issue new Shares if and when appropriate, the following ordinary resolutions will be proposed at the AGM to approve:

• (a) the granting of the proposed Share Repurchase Mandate to the Directors to exercise the power of the Company to repurchase Shares not exceeding 10% of the total number of issued Shares of the Company as at the date of passing the proposed ordinary resolution contained in item 8(1) of the notice of the AGM as set out on pages 19 to 22 of this circular, being a maximum of 400,000,000 Shares on the basis that no further Shares are issued or repurchased during the period from the Latest Practicable Date up to the date of the AGM;

• (b) the granting of the proposed Share Issuance Mandate to the Directors to exercise the power of the Company to allot, issue or deal with new Shares not exceeding 20% of the total number of issued Shares of the Company as at the date of passing the proposed ordinary resolution contained in item 8(2) of the notice of the AGM as set out on pages 19 to 22 of this circular, being a maximum of 800,000,000 Shares on the basis that no further Shares are issued or repurchased during the period from the Latest Practicable Date up to the date of the AGM; and

• (c) the extension of the Share Issuance Mandate such that the number of the Shares repurchased by the Company pursuant to the Share Repurchase Mandate as mentioned in item 8(1) of the notice of the AGM will also be added to the Share Issuance Mandate as mentioned in item 8(2) of the notice of the AGM.

With reference to the Share Repurchase Mandate and the Share Issuance Mandate, the Directors wish to state that they have no immediate plan to repurchase any Shares or issue any new Shares pursuant thereto.

An explanatory statement required by the Listing Rules to provide the Shareholders with all information reasonably necessary to enable them to make an informed decision on whether to vote for or against the granting of the Share Repurchase Mandate is set out in Appendix II to this circular.

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LETTER FROM THE BOARD

ANNUAL GENERAL MEETING AND PROXY ARRANGEMENT

The notice of the AGM is set out on pages 19 to 22 of this circular.

Pursuant to the Listing Rules and the Articles, any vote of the Shareholders at a general meeting must, subject to certain exceptions, be taken by poll. Accordingly, all the proposed resolutions will be put to vote by way of poll at the AGM. An announcement on the poll vote results will be published by the Company after the AGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

A form of proxy for use at the AGM is enclosed with this circular and such form of proxy is also published on the websites of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) and the Company (www.newton-resources.com). To be valid, the form of proxy must be completed and signed 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 that power of attorney or authority at the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for holding the AGM (i.e. at or before 11:45 a.m. on Monday, 21 May 2018 (Hong Kong time)) or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting in person at the AGM or any adjournment thereof if you so wish and, in such event, your form of proxy shall be deemed to be revoked.

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules 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 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.

RECOMMENDATION

The Directors consider that the proposals for the re-election of retiring Directors, the granting of the Share Repurchase Mandate and Share Issuance Mandate to repurchase Shares and to issue new Shares and the extension of the Share Issuance Mandate are in the best interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favour of the relevant resolutions to be proposed at the AGM.

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LETTER FROM THE BOARD

GENERAL

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

Your attention is also drawn to the additional information set out in the Appendices to this circular.

Yours faithfully, For and on behalf of the Board Newton Resources Ltd Luk Yue Kan

Executive Director, Chief Financial Officer and Company Secretary

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

The following are the details of the retiring Directors who will retire and, being eligible, offer themselves for re-election at the AGM:

Mr. Wu Wai Leung, Danny , aged 57, was appointed as a non-executive Director on 21 May 2015. He is currently a member of each of the audit committee and the investment committee of the Company and a director of several subsidiaries of the Company. Mr. Wu is also an executive director and the chief executive officer of Greenheart Group Limited (stock code: 94) and an independent non-executive director of Qianhai Health Holdings Limited (stock code: 911).

Mr. Wu was previously the chairman of the investment committee of the Company for the period from 7 October 2016 to 9 April 2018. He was also previously an independent non-executive Director, a member of each of the audit committee, the remuneration committee and the nomination committee of the Company, up to his retirement at the conclusion of the 2015 annual general meeting of the Company on 21 May 2015.

He graduated from the University of Hong Kong with a Bachelor’s degree in social sciences in 1985.

Mr. Wu has over 20 years of experience in investing and business operations in Asia. Since 2003, Mr. Wu has been a director of First Gateway Capital Limited which engages in early stage investment, and investment advisory services to small and medium enterprises in Asia, with a focus in transportation, resource, manufacturing, technology and telecommunication companies. From 1985 to 2002, Mr. Wu served various management positions in Hong Kong Trade Development Council, the Hong Kong office of Quanta Industries Ltd., Sino-Wood Partners, Limited and had been a director of Sino Automotive Parts Limited. Between 2003 and 2006, Mr. Wu was the Economic Advisor of Weifang Municipal Overseas Investment Promotion Bureau, Shandong Province, the PRC.

Save as disclosed above, Mr. Wu did not hold any position with the Company or other members of the Group, any directorship in other listed public companies in the three years preceding the Latest Practicable Date, or any other major appointment or professional qualification.

Mr. Wu entered into a letter of appointment with the Company on 20 May 2015 for a fixed term of three years commencing from 21 May 2015, subject to retirement by rotation and re-election at annual general meetings pursuant to the Articles, and subject to termination thereof by service of not less than three months’ notice by either party. In respect of his service to the Company as non-executive Director, Mr. Wu is entitled to a Director’s fee of HK$264,000 per annum pursuant to his letter of appointment. Save for the Director’s fee, he is not expected to receive any other remuneration for holding his office as a non-executive Director. Mr. Wu’s annual emoluments as non-executive Director was determined by the Board based on the recommendation from the remuneration committee of the Company with reference to the Company’s performance, his duties and responsibilities with the Company, and the prevailing market conditions. For the financial year ended 31 December 2017, his emoluments comprised a Director’s fee of HK$240,000.

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

As at the Latest Practicable Date, Mr. Wu does not have any interests in the Shares within the meaning of Part XV of the SFO. Save as disclosed above, Mr. Wu does not have any relationship with any other Director, senior management, Substantial Shareholder or Controlling Shareholder of the Company.

There is no information in relation to Mr. Wu that is required to be disclosed pursuant to any of the requirements under Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter in relation to Mr. Wu that needs to be brought to the attention of the Shareholders.

Mr. Shin Yick, Fabian , aged 49, was appointed as an independent non-executive Director on 14 August 2015 and is a member of each of the audit committee, the remuneration committee and the nomination committee of the Company.

Mr. Shin is currently the chief executive officer of Well Link International Capital Limited (previously known as Zhaobangji International Capital Limited), which is engaged in investment business, an independent non-executive director of Lisi Group (Holdings) Limited (stock code: 526), China Shun Ke Long Holdings Limited (stock code: 974) and Huabang Financial Holdings Limited (stock code: 3638), a non-executive director of Pak Tak International Limited (stock code: 2668), those companies are listed on the Stock Exchange, and a director of BIO-key International, Inc. (NASDAQ: BKYI), a company whose shares are traded at the Nasdaq stock market of the United States. He was the deputy chief executive officer of CMB International Capital Limited from February 2010 to July 2015. Mr. Shin has over 27 years of experience in investment banking and financial management. Prior to joining CMB International Capital Limited, he worked in several investment banks in Hong Kong.

Mr. Shin was appointed as a non-executive director of Qianhai Health Holdings Limited (stock code: 911) on 6 January 2016 and resigned on 3 February 2016.

Mr. Shin graduated from the University of Birmingham in England with a Bachelor’s degree in commerce. After graduation, he worked in the audit department of Deloitte Touche Tohmatsu. He had also worked in a listed company in Hong Kong as group financial controller. He is a fellow member of the Hong Kong Institute of Certified Public Accountants, The Association of Chartered Certified Accountants, The Institute of Chartered Secretaries and Administrators and The Hong Kong Institute of Chartered Secretaries.

Save as disclosed above, Mr. Shin did not hold any position with the Company or other members of the Group, any directorship in other listed public companies in the three years preceding the Latest Practicable Date, or any other major appointment or professional qualification.

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

Mr. Shin entered into a letter of appointment with the Company on 10 August 2015 for a fixed term of three years commencing from 14 August 2015, subject to retirement by rotation and re-election at annual general meetings pursuant to the Articles, and subject to termination thereof by service of not less than three months’ notice by either party. In respect of his service to the Company as independent non-executive Director, Mr. Shin is entitled to a Director’s fee of HK$264,000 per annum pursuant to his letter of appointment. Save for the Director’s fee, he is not expected to receive any other remuneration for holding his office as an independent non-executive Director. Mr. Shin’s annual emoluments as independent non-executive Director was determined by the Board based on the recommendation from the remuneration committee of the Company with reference to the Company’s performance, his duties and responsibilities with the Company, and the prevailing market conditions. For the financial year ended 31 December 2017, his emoluments comprised a Director’s fee of HK$240,000.

As at the Latest Practicable Date, Mr. Shin does not have any interests in the Shares within the meaning of Part XV of the SFO. Save as disclosed above, Mr. Shin does not have any relationship with any other Directors, senior management, Substantial Shareholder or Controlling Shareholder of the Company.

There is no information in relation to Mr. Shin that is required to be disclosed pursuant to any of the requirements under Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter in relation to Mr. Shin that needs to be brought to the attention of the Shareholders.

Mr. Li Changfa , aged 71, was appointed as an executive Director and the chief operating officer of the Company on 1 March 2014. He is currently the chairman of the board of directors and legal representative of two PRC subsidiaries of the Company. He is responsible for the overall operation management and strategic development of the Group, and oversees the management, operation, sales and business development of the Yanjiazhuang Mine.

Mr. Li was professionally accredited economist by the Personnel Department of Henan Province（河 南省人事廳）in 1992, and graduated from the China University of Petroleum with a major in business administration in 2006.

Mr. Li has over 20 years of experience in business operations, project management and mergers and acquisitions. From 1964 to 1992, he held various management positions in China ShenMa Group and numerous enterprises. From 1992 to 1999, he worked in the subsidiaries of the Ministry of Textile Industry and China General Chamber of Textile（中國紡織工業部及中國紡織總會）, and participated in mergers and acquisitions, restructuring, establishment and management of corporations. From 2002 to 2008, he held various positions, including director and vice president of China Printed Circuit Association, mainly responsible for its policy study and industry development advisory.

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

Mr. Li was appointed as the vice-chairman of the China Chamber of International Commerce Guangzhou Chamber of Commerce in 2004. From 2006 to 2011, he was appointed as a member of the Eighth Guangzhou Baiyun District Committee of the Chinese People’s Political Consultative Conference of the People’s Republic of China.

Save as disclosed above, Mr. Li did not hold any position with the Company or other members of the Group, any directorship in other listed public companies in the three years preceding the Latest Practicable Date, or any other major appointment or professional qualification.

Mr. Li entered into a service contract with the Company on 13 January 2017 for a fixed term of three years commencing from 1 March 2017, subject to retirement by rotation and re-election at annual general meetings pursuant to the Articles, and subject to termination thereof by service of not less than three months’ notice by either party. Mr. Li is entitled to a remuneration of RMB130,000 per month and a discretionary bonus in respect of his service to the Company as an executive Director and chief operating officer of the Company pursuant to his service contract. Save for the above remuneration and discretionary bonus, he is not expected to receive any other remuneration for holding his office as an executive Director. Mr. Li’s annual emoluments as executive Director and chief operating officer of the Company was determined by the Board based on the recommendation from the remuneration committee of the Company with reference to the Company’s performance, his duties and responsibilities with the Company, and the prevailing market conditions. For the financial year ended 31 December 2017, his emoluments comprised salaries and discretionary bonus of approximately RMB1,877,000.

As at the Latest Practicable Date, Mr. Li does not have any interests in Shares within the meaning of Part XV of the SFO. Save as disclosed above, Mr. Li does not have any relationship with any other Director, senior management, Substantial Shareholder or Controlling Shareholder of the Company.

There is no information in relation to Mr. Li that is required to be disclosed pursuant to any of the requirements under Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter in relation to Mr. Li that needs to be brought to the attention of the Shareholders.

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

Mr. Chong Tin Lung, Benny , aged 45, was appointed as an executive Director, the chairman of the Board, the chairman of the investment committee and a member of each of the nomination committee and the remuneration committee of the Company with effect from 9 April 2018.

Mr. Chong is currently an executive director, the executive chairman and the chief executive officer of Auto Italia Holdings Limited (stock code: 720).

Mr. Chong is the founder of VMS Group and has served as its chairman since its establishment in 2006. He is also a director of VMS Investment Group Limited, which is a Substantial Shareholder of the Company. Mr. Chong has accumulated over 20 years of experience in the financial and investment industry. VMS Group is principally engaged in proprietary investments, private equity, asset management, securities brokerage and corporate finance advisory services.

Mr. Chong is a Chartered Financial Analyst. He obtained a Bachelor of Commerce from the University of Toronto in 1994 and a Master of Science in Investment Management from the Hong Kong University of Science and Technology in 2000.

Mr. Chong is the son of Ms. Mak Siu Hang, Viola, who is a Substantial Shareholder of the Company.

Mr. Chong was reprimanded by the Securities and Futures Commission of Hong Kong for misconduct in 2003, as an ex-securities dealer’s representative, among other things, for giving an impression to a person that he would help that person to manipulate the shares of a company listed on the Stock Exchange. No prosecution has been brought against Mr. Chong in this incident. The above incident has been drawn to the attention of the Board. Having considered that (i) Mr. Chong has extensive experience in the financial sector through his position in the VMS Group which will enable him to make valuable contribution to the Group’s future strategic development; (ii) the above incident occurred over a decade ago and no further action has been taken against Mr. Chong other than the above incident; and (iii) Mr. Chong is able to demonstrate a standard of competence commensurate with his position as an executive Director and the chairman of the Board given that he has founded and built up the VMS Group, the Board is satisfied that Mr. Chong has demonstrated the requisite character, experience and integrity to take up the positions of an executive Director and the chairman of the Board.

Save as disclosed above, Mr. Chong did not hold any position with the Company or other members of the Group, any directorship in other listed public companies in the three years preceding the Latest Practicable Date, or any other major appointment or professional qualification.

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DETAILS OF THE RETIRING DIRECTORS STANDING FOR RE-ELECTION

APPENDIX I

Mr. Chong entered into a service agreement with the Company on 27 March 2018 in relation to his appointment as an executive Director and the chairman of the Board for a fixed term of three years commencing from 9 April 2018, subject to retirement by rotation and re-election at annual general meetings pursuant to the Articles, and subject to termination thereof by service of not less than three months’ notice by either party. Mr. Chong is entitled to a remuneration of HK$150,000 per month and a discretionary bonus in respect of his service to the Company as an executive Director and the chairman of the Board pursuant to his service agreement. Save for the above remuneration and discretionary bonus, he is not expected to receive any other remuneration for holding his office as an executive Director. Mr. Chong’s annual emoluments as executive Director and the chairman of the Board was determined by the Board based on the recommendation from the remuneration committee of the Company with reference to the Company’s performance, his duties and responsibilities with the Company, and the prevailing market conditions.

As at the Latest Practicable Date, Mr. Chong does not have any interests in the Shares within the meaning of Part XV of the SFO. Save as disclosed above, Mr. Chong does not have any relationship with any other Director, senior management, Substantial Shareholder or Controlling Shareholder of the Company.

Save as disclosed above, there is no information in relation to Mr. Chong that is required to be disclosed pursuant to any of the requirements under Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter in relation to Mr. Chong that needs to be brought to the attention of the Shareholders.

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

The following is an explanatory statement required by the Listing Rules to provide the Shareholders with all information reasonably necessary to enable them to make an informed decision on whether to vote for or against the ordinary resolution to be proposed at the AGM in relation to the granting of the Share Repurchase Mandate.

1. SHARE CAPITAL

As at the Latest Practicable Date, the total number of issued Shares of the Company comprised 4,000,000,000 Shares.

Subject to the passing of the ordinary resolution granting the proposed Share Repurchase Mandate as set out in item 8(1) of the notice of the AGM and on the basis that no further Shares are issued or repurchased during the period from the Latest Practicable Date up to the date of the AGM, the Directors would be authorised to exercise the power of the Company under the Share Repurchase Mandate to repurchase, during the period in which the Share Repurchase Mandate remains in force, up to a maximum of 400,000,000 Shares, representing 10% of the total number of issued Shares of the Company as at the date of the AGM.

2. REASONS FOR REPURCHASE

The Directors believe that the granting of the Share Repurchase Mandate is in the best interests of the Company and the Shareholders as a whole. Such repurchases of Shares may, depending on the market conditions and funding arrangements at the relevant time, result in an enhancement of the net asset value per Share and/or earnings per Share and will only be made when the Directors believe that such a repurchase will benefit the Company and the Shareholders.

3. FUNDING OF REPURCHASE

Repurchases of Shares pursuant to the proposed Share Repurchase Mandate would be financed out of funds legally available for such purpose in accordance with the memorandum and articles of association of the Company, the laws of the Cayman Islands and/or any other applicable laws, as the case may be.

Repurchases will be funded from the Company’s available cash flow or working capital facilities.

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

4. IMPACT OF REPURCHASE

There might be a material adverse impact on the working capital and/or gearing position of the Company (as compared with the financial position disclosed in the latest audited accounts contained in the annual report of the Company for the year ended 31 December 2017) in the event that the Share Repurchase Mandate was to be carried out in full at any time during the proposed repurchase period. However, the Directors do not intend to exercise the Share Repurchase Mandate to such extent and in circumstances that would have a material adverse impact on the working capital or the gearing levels of the Company which in the opinion of the Directors are from time to time appropriate for the Company.

5. SHARE PRICES

The highest and lowest prices per Share at which Shares traded on the Stock Exchange during each of the previous 12 months, and up to the Latest Practicable Date were as follows:

	Highest	Lowest
Month	Price	Price
	HK$	HK$
2017
April	0.75	0.67
May	0.71	0.62
June	0.81	0.55
July	0.75	0.60
August	0.71	0.61
September	0.75	0.54
October	0.80	0.67
November	1.30	0.63
December	0.95	0.65
2018
January	0.97	0.80
February	0.90	0.77
March	0.89	0.65
April (up to the Latest Practicable Date)	0.72	0.65

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

6. EFFECT OF TAKEOVERS CODE

If a Shareholder’s proportionate interest in the voting rights of the Company increases as a result of a repurchase of Shares pursuant to the Share Repurchase Mandate, such increase will be treated as an acquisition of voting rights for the purposes of the Takeovers Code. Accordingly, a Shareholder or a group of Shareholders acting in concert (within the meaning under the Takeovers Code), depending on the level of increase of the Shareholder’s interest, could obtain or consolidate control of the Company and become(s) obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code.

As at the Latest Practicable Date, if the Share Repurchase Mandate is exercised in full and assuming that (i) there would not be any changes in the issued share capital of the Company prior to such repurchase of Shares; and (ii) each of the Shareholders below would not dispose of or acquire any Shares prior to such repurchase, the shareholding percentage of the Shareholders, who, so far as is known to the Directors, before such repurchase had and/or would after such repurchase have an interest in 10% or more of the total number of issued Shares of the Company would be as follows:

			Percentage of
		Percentage of	shareholding
		shareholdings	if Share
		before exercise	Repurchase
		of Share	Mandate is
	Number of	Repurchase	exercised
Name of Shareholder	Shares held	Mandate	in full
Mak Siu Hang, Viola(1)	1,149,744,000	28.74%	31.94%
VMS Investment Group Limited (“VMSIG”)(1)	1,149,744,000	28.74%	31.94%
Fast Fortune Holdings Limited (“Fast Fortune”)(1)	360,000,000	9.00%	10.00%
Shougang Group Co., Ltd.(2)	1,098,570,000	27.46%	30.52%
Shougang Holding (Hong Kong) Limited
(“Shougang Hong Kong”)(2)	1,098,570,000	27.46%	30.52%
Lord Fortune Enterprises Limited (“Lord Fortune”)(2)	370,000,000	9.25%	10.28%
Plus All Holdings Limited (“Plus All”)(2)	728,570,000	18.21%	20.24%
Cheng Yu Tung Family (Holdings) Limited(3)	620,000,000	15.50%	17.22%
Cheng Yu Tung Family (Holdings II) Limited(4)	620,000,000	15.50%	17.22%
Chow Tai Fook Capital Limited (“CTF Capital”)(5)	620,000,000	15.50%	17.22%
Chow Tai Fook (Holding) Limited
(“CTF Holding”)(6)	620,000,000	15.50%	17.22%

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

			Percentage of
		Percentage of	shareholding
		shareholdings	if Share
		before exercise	Repurchase
		of Share	Mandate is
	Number of	Repurchase	exercised
Name of Shareholder	Shares held	Mandate	in full
Chow Tai Fook Enterprises Limited
(“CTF Enterprises”)(7)	620,000,000	15.50%	17.22%
New World Development Company Limited
(“NWD”)(8)	620,000,000	15.50%	17.22%
NWS Holdings Limited (“NWS”)(9)	620,000,000	15.50%	17.22%
NWS Resources Limited (“NWS Resources”)(9)	620,000,000	15.50%	17.22%
NWS Mining Limited (“NWS Mining”)(9)	620,000,000	15.50%	17.22%
Modern Global Holdings Limited
(“Modern Global”)(9)	620,000,000	15.50%	17.22%
Perfect Move Limited (“Perfect Move”)(9)	620,000,000	15.50%	17.22%
Faithful Boom Investments Limited
(“Faithful Boom”)(9)	620,000,000	15.50%	17.22%

Notes:

• (1) Fast Fortune and VMSIG held 360,000,000 Shares and 789,744,000 Shares as beneficial owners, respectively. Ms. Mak Siu Hang, Viola held a 100% direct interest in VMSIG. Fast Fortune was a whollyowned subsidiary of VMSIG. Therefore, Ms. Mak Siu Hang, Viola was deemed to be interested in all the Shares held by each of VMSIG and Fast Fortune, and VMSIG was deemed to be interested in all the Shares held by Fast Fortune.

• (2) Shougang Group Co., Ltd. held a 100% direct interest in Shougang Hong Kong. Lord Fortune and Plus All were wholly-owned subsidiaries of Shougang Hong Kong. Therefore, Shougang Group Co., Ltd. and Shougang Hong Kong were both deemed to be interested in all the Shares held by Lord Fortune and Plus All.

• (3) Cheng Yu Tung Family (Holdings) Limited held approximately 48.98% direct interest in CTF Capital and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by CTF Capital.

• (4) Cheng Yu Tung Family (Holdings II) Limited held approximately 46.65% direct interest in CTF Capital and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by CTF Capital.

• (5) CTF Capital held approximately 81.03% direct interest in CTF Holding and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by CTF Holding.

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

• (6) CTF Holding held 100% direct interest in CTF Enterprises and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by CTF Enterprises.

• (7) CTF Enterprises held more than one-third of the issued shares of NWD and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by NWD.

• (8) NWD held more than 60% direct interest in NWS and was accordingly deemed to have an interest in the Shares interested by or deemed to be interested by NWS.

• (9) NWS held a 100% direct interest in NWS Resources, which held a 100% direct interest in NWS Mining. NWS Mining held a 100% interest in Modern Global, which held a 100% direct interest in Perfect Move. Faithful Boom was a wholly-owned subsidiary of Perfect Move. Therefore, NWS, NWS Resources, NWS Mining, Modern Global and Perfect Move were all deemed to be interested in all the Shares held by Faithful Boom.

In the event that the Share Repurchase Mandate is exercised in full and assuming that no Shares are issued or repurchased between the Latest Practicable Date and the date of repurchase and no Shares are disposed of or acquired by these Shareholders as aforesaid, the shareholding of these Shareholders in the Company would be increased to approximately the respective percentage as shown in the last column of the table above. Such increases will give rise to an obligation by Ms. Mak Siu Hang, Viola, VMSIG, Shougang Group Co., Ltd. and Shougang Hong Kong to make a mandatory offer for all the issued Shares under Rules 26 and 32 of the Takeovers Code. The Directors will not exercise the Share Repurchase Mandate to such an extent that would give rise to such obligation, or reduce the amount of Shares held by the public to less than 25% of the total number of issued Shares of the Company.

7. SHARE REPURCHASE MADE BY THE COMPANY

During the 6 months immediately prior to the Latest Practicable Date, the Company had not repurchased any of the Shares (whether on the Stock Exchange or otherwise).

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EXPLANATORY STATEMENT FOR THE SHARE REPURCHASE MANDATE

APPENDIX II

8. UNDERTAKING OF THE DIRECTORS

To the best of their knowledge and having made all reasonable enquiries, none of the Directors nor any of their respective close associates (as defined in the Listing Rules) has any present intention to sell any Shares to the Company in the event that the granting of the Share Repurchase Mandate is approved by the Shareholders.

The Company has not been notified by any core connected persons of the Company that they have a present intention to sell any Shares to the Company, or that they have undertaken not to sell any Shares held by them to the Company in the event that the granting of the Share Repurchase Mandate is approved by the Shareholders.

The Directors have undertaken to the Stock Exchange to exercise the power of the Company to make repurchases of Shares pursuant to the Share Repurchase Mandate in accordance with the Listing Rules and the applicable laws of the Cayman Islands and in accordance with the regulations set out in the memorandum and articles of association of the Company.

– 18 –

NOTICE OF ANNUAL GENERAL MEETING

==> picture [177 x 39] intentionally omitted <==

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1231)

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT an Annual General Meeting of Newton Resources Ltd (the “Company”) will be held at Meeting Room S428 (Harbour Road Entrance), Hong Kong Convention and Exhibition Centre, 1 Expo Drive, Wanchai, Hong Kong on Wednesday, 23 May 2018 at 11:45 a.m. for the following purposes:

ORDINARY RESOLUTIONS

1. To receive and consider the audited consolidated financial statements of the Company and the reports of the directors and independent auditor for the year ended 31 December 2017.

2. To re-elect Mr. Wu Wai Leung, Danny as a non-executive director of the Company.

3. To re-elect Mr. Shin Yick, Fabian as an independent non-executive director of the Company.

4. To re-elect Mr. Li Changfa as an executive director of the Company.

5. To re-elect Mr. Chong Tin Lung, Benny as an executive director of the Company.

6. To authorise the board of directors of the Company to fix the directors’ remuneration.

7. To re-appoint Messrs. Ernst & Young as the auditor of the Company and to authorise the board of directors of the Company to fix the auditor’s remuneration.

8. To consider as specific business and, if thought fit, pass with or without amendment(s), the following resolutions as ordinary resolutions:

9. (1) “ THAT :

   • (a) subject to paragraph (b) of this resolution, a general mandate be and is hereby generally and unconditionally given to the directors of the Company (the “Directors”) to exercise all the powers of the Company during the Relevant Period (as hereinafter defined) to repurchase its shares on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the shares of the Company may be listed and recognised by the Securities and Futures Commission and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws, rules and regulations including but not limited to the requirements of the Rules Governing the Listing of Securities on the Stock Exchange or that of any other stock exchange as amended from time to time;

– 19 –

NOTICE OF ANNUAL GENERAL MEETING

• (b) the total number of shares of the Company to be repurchased by the Company pursuant to the mandate in paragraph (a) of this resolution shall not exceed 10% of the total number of issued shares of the Company as at the date of passing this resolution and the said mandate shall be limited accordingly; and

• (c) for the purposes of this resolution:

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

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the shareholders in general meeting.”

(2) “ THAT :

• (a) subject to paragraph (c) of this resolution, a general mandate be and is hereby generally and unconditionally approved and given to the Directors during the Relevant Period (as hereinafter defined) to allot, issue and deal with additional shares in the capital of the Company or securities convertible into such shares or options, warrants, or similar rights to subscribe for any shares or convertible securities and to make or grant offers, agreements and options which would or might require the exercise of such powers;

• (b) the mandate in paragraph (a) of this resolution shall authorise the Directors to make or grant offers, agreements and options during the Relevant Period which would or might require the exercise of such powers after the end of the Relevant Period;

• (c) the aggregate number of share allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) and issued by the Directors pursuant to the mandate in paragraph (a) of this resolution, otherwise than pursuant to:

• (i) a Rights Issue (as hereinafter defined);

• (ii) the exercise of any conversion rights attaching to any securities which are convertible into shares of the Company;

• (iii) the exercise of the rights under any option scheme of the Company or similar arrangement for the time being adopted for the grant or issue to Directors and/or employees of the Company and/or any of its subsidiaries of options to subscribe for, or rights to acquire, shares of the Company; or

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NOTICE OF ANNUAL GENERAL MEETING

• (iv) any issue of shares as scrip dividends or similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on the shares of the Company in accordance with the articles of association of the Company from time to time,

shall not exceed 20% of the total number of issued shares of the Company as at the date of passing this resolution and the said mandate shall be limited accordingly; and

• (d) for the purposes of this resolution:

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

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the shareholders in general meeting.

“Rights Issue” means an offer of shares open for a period fixed by the Directors to holders of shares of the Company or any class thereof on the register of members on a fixed record date in proportion to their then holdings of such shares or class thereof (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 any relevant jurisdiction or the requirements of any recognised regulatory body or any stock exchange).”

• (3) “ THAT conditional upon the passing of the ordinary resolutions set out in items 8(1) and 8(2) of the notice convening this meeting (the “Notice”), the general mandate referred to in the ordinary resolution set out in item 8(2) of the Notice be and is hereby extended by the addition to the aggregate number of shares which may be allotted, issued and dealt with or agreed conditionally or unconditionally to be allotted, issued and dealt with by the Directors pursuant to such general mandate of an amount representing the aggregate number of shares of the Company repurchased by the Company pursuant to the mandate referred to in the ordinary resolution set out in item 8(1) of the Notice, provided that such amount shall not exceed 10% of the aggregate number of issued shares of the Company as at the date of passing the ordinary resolution set out in item 8(1).”

By Order of the Board Newton Resources Ltd

Luk Yue Kan

Executive Director, Chief Financial Officer and Company Secretary

Hong Kong, 19 April 2018

– 21 –

NOTICE OF ANNUAL GENERAL MEETING

Notes:

1. All resolutions at the meeting 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”) and the articles of association of the Company and the poll voting results will be published on the websites of the Hong Kong Exchanges and Clearing Limited and the Company in accordance with the Listing Rules.

2. Any member of the Company entitled to attend and vote at the meeting is entitled to appoint another person as his proxy to attend and vote instead of him/her/it. A member of the Company who is the holder of two or more shares of the Company may appoint more than one proxy to represent him/her/it and vote on his/her/its behalf at the meeting or any adjournment thereof. A proxy (who must be an individual) need not be a member of the Company. If more than one proxy is so appointed, the appointment shall specify the number and class of shares in respect of which each such proxy is so appointed. In addition, a proxy or proxies representing either a member of the Company who is an individual or a member of the Company which is a corporation is entitled to exercise the same powers on behalf of the member of the Company which he or they represent(s) as such member of the Company could exercise.

3. In order to be valid, the form of proxy together with the power of attorney or other authority, if any, under which it is signed or a certified copy of that power of attorney or authority, shall be deposited at the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for the holding of the meeting (i.e. at or before 11:45 a.m. on Monday, 21 May 2018 (Hong Kong time)) or any adjournment thereof. Delivery of the form of proxy shall not preclude a member of the Company from attending and voting in person at the meeting and, in such event, the instrument appointing a proxy shall be deemed to be revoked.

4. For determining the entitlement to attend and vote at the meeting, the register of members of the Company will be closed from Thursday, 17 May 2018 to Wednesday, 23 May 2018, both dates inclusive, during which period no transfer of shares will be registered. In order to qualify for attending and voting at the meeting, all transfers of shares of the Company accompanied by the relevant properly completed transfer forms and the relevant share certificates must be lodged with the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong for registration not later than 4:30 p.m. on Wednesday, 16 May 2018.

5. An explanatory statement containing further details regarding the ordinary resolution item 8(1) above in this Notice is set out in Appendix II to the circular of the Company dated 19 April 2018.

6. If a Typhoon Signal No. 8 or above is hoisted or a Black Rainstorm Warning Signal is in force at or at any time after 9:00 a.m. on the date of the meeting, the meeting will be postponed or adjourned. The Company will post an announcement on the websites of the Hong Kong Exchanges and Clearing Limited and the Company to notify shareholders of the date, time and place of the rescheduled meeting.

The meeting will be held as scheduled when an Amber or Red Rainstorm Warning Signal is in force. Shareholders should decide on their own whether they would attend the meeting under bad weather condition bearing in mind their own situation.

– 22 –