PegBio Co., Ltd. — Share Issue/Capital Change 2000

Mar 6, 2000

Listed Company Information

HUNG FUNG GROUP<1141> - Announcement The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. Hung Fung Group Holdings Limited (the "Company") (Incorporated in Bermuda with limited liability) PROPOSALS FOR SUBDIVISION OF SHARES, CHANGE IN BOARD LOT SIZE OF SHARES FOR TRADING AND RENEWAL OF GENERAL MANDATES TO REPURCHASE SECURITIES AND TO ISSUE NEW SHARES The Board of the Company proposes that each of the existing issued and unissued shares of HK$0.10 in the share capital of the Company be subdivided into ten Subdivided Shares of HK$0.01 each. The Share Subdivision is conditional. Each board lot of shares of the Company will be increased from 2,000 Shares to 20,000 Subdivided Shares. The Board also proposes to renew the general mandates granted to the Board on 28 September 1999 to allot, issue and repurchase securities of the Company. This announcement is also made in response to the recent increases in the price and trading volumn of the Shares. SHARE SUBDIVISION The board of directors of the Company (the "Board") proposes that each of the existing issued and unissued ordinary shares of HK$0.10 each ("Shares") be subdivided ("Share Subdivision") into ten shares of HK$0.01 each ("Subdivided Shares"). With the intention to improve liquidity of the trading in the Shares on the Stock Exchange of Hong Kong Limited (the "Stock Exchange"), the Board is of the view that the Share Subdivision is in the interests of the Company and its shareholders (the "Shareholders"). As at the date of this announcement, the authorised share capital of the Company is HK$100,000,000 which is divided into 1,000,000,000 Shares, of which 247,120,800 Shares are in issue and fully paid or credited as fully paid. Immediately upon completion of the Share Subdivision and presuming that the issued share capital remains unchanged, the authorised share capital of the Company will be HK$100,000,000 comprising 10,000,000,000 Subdivided Shares, of which 2,471,208,000 Subdivided Shares will be in issue and fully paid or credited as fully paid. The Subdivided Shares will rank pari passu in all respects with each other and the Share Subdivision will not result in any change in the relative rights of the Shareholders. CHANGE IN BOARD LOT SIZE Currently, the Shares are traded in board lots of 2,000 Shares. Upon the Share Subdivision becoming effective, the Subdivided Shares will be traded in board lots of 20,000 Subdivided Shares. CONDITIONS OF THE SHARE SUBDIVISION The Share Subdivision is conditional upon, inter alia: (a) the passing of an ordinary resolution by the Shareholders at a special general meeting to be held at 9:00 a.m. on 5 April 2000 (the "SGM"); and (b) the Listing Committee of the Stock Exchange granting the listing of and permission to deal in the Subdivided Shares. EXPECTED TIMETABLE The expected timetable for the Share Subdivision is as follow: Year 2000 SGM circular despatched on or about Monday, 20 March Latest time for lodging form of proxy in respect of the SGM 9:00 a.m. on Monday, 3 April SGM 9:00 a.m. on Wednesday, 5 April Effective date of Share Subdivision Thursday, 6 April Dealing in Subdivided Shares commences 10:00 a.m. on Thursday, 6 April Existing counter for trading in existing Shares in board lots of 2,000 Shares temporarily closes 10:00 a.m. on Thursday, 6 April Temporary counter for trading in Subdivided Shares in board lots of 20,000 Subdivided Shares (in the form of existing Share certificates) opens 10:00 a.m. on Thursday, 6 April First day of free exchange of certificates for existing Shares for new certificates for the Subdivided Shares Thursday, 6 April Existing counter for trading in Subdivided Shares in board lots of 20,000 Subdivided Shares (in the form of new certificates for the Subdivided Shares) reopens 10:00 a.m. on Thursday, 20 April Parallel trading in Subdivided Shares (in the form of new certificates for Subdivided Shares and existing Share certificates) commences 10:00 a.m. on Thursday, 20 April Temporary counter of trading in Subdivided Shares in board lots of 20,000 Subdivided Shares (in the form of certificates for existing Shares) closes 4:00 p.m. on Friday, 12 May Parallel trading in Subdivided Shares (in the form of new certificates for Subdivided Shares and existing Share certificates) ends 4:00 p.m. on Friday, 12 May Last day for free exchange of certificates for existing Shares for new certificates for Subdivided Shares 4:00 p.m. on Wednesday, 17 May Subject to the fulfilment of the conditions listed above, the Shareholders are requested to lodge the relevant certificates with Tengis Limited, the Company's branch registrar, at Room 1601, Hutchison House, 10 Harcourt Road, Hong Kong as soon as possible after 6 April 2000 to exchange their existing Share certificates for new share certificates. New share certificates for the Subdivided Shares will be issued to the Shareholders free of charge for the period from 6 April 2000 to 17 May 2000, both dates inclusive. The Shareholders are reminded that subject to satisfaction of the conditions listed above, after 4:00 p.m. on Friday, 12 May 2000 when parallel trading in the Subdivided Shares (in the form of new certificates for the Subdivided Shares and existing Share certificates) ends, existing Share certificates in board lots of 2,000 Shares will cease to be marketable and will not be acceptable for dealing purposes. However, such certificates will continue to be good evidence of legal title to the Subdivided Shares on the basis of one Share for ten Subdivided Shares and may be lodged with Tengis Limited in exchange for new certificates for the Subdivided Shares at any time (a charge is required to be paid if they are lodged with Tengis Limited after 4:00 p.m. on 17 May 2000). ADJUSTMENT TO THE SUBSCRIPTION PRICE OF THE WARRANTS OF THE COMPANY The Board refers to the announcement of the Company dated 8 February 2000 in respect of, among other things, the issue of 10,000,000 new Shares (the "Subscription Shares") to Baxter Resources S.A., the controlling shareholder of the Company, at the price of HK$1.23 per Share. It is noted that the issue of the Subscription Shares has not led to an adjustment to the subscription price of the warrants of the Company (the "Warrants") granted pursuant to the instrument constituting the Warrants conferring rights to subscribe for new shares in the Company at any time from the date of issue up to and including 28 September 2001 (the "Warrant Instrument"). Subject to the Share Subdivision becoming unconditional and effective, the Share Subdivision will constitute an event giving rise to an adjustment to the subscription price of the Warrants in accordance with the Warrant Instrument. Further details of such adjustment will be contained in the circular to be despatched to the Shareholders and the holders of the Warrants ("Warrant Holders") as referred to below. ADJUSTMENT TO THE EXERCISE PRICE AND NUMBER OF SHARE OPTIONS OF THE COMPANY As at the date of this announcement, there are outstanding share options granted by the Company which entitle the holders thereof to subscribe for a total of 7,470,000 Shares at the option price of HK$0.46 per Share. Upon the Share Subdivision becoming unconditional and effective, it is expected that the number of shares and the option price in respect of the outstanding share options of the Company will be adjusted. Further details of such adjustment will be contained in the circular to be despatched to the Shareholders and the Warrant Holders as referred to below. RENEWAL OF GENERAL MANDATES TO REPURCHASE SECURITIES AND TO ISSUE NEW SHARES The Board also proposes to renew the general mandates granted to the Board at the Annual General Meeting of the Company held on 28 September 1999 to allot, issue and repurchase securities of the Company. The Board will seek approval of the relevant resolutions to be proposed at the SGM. GENERAL An application will be made to the Stock Exchange for the listing of and permission to deal in the Subdivided Shares. A circular containing, among other things, details of the Share Subdivision, adjustment to the subscription price of the Warrants, adjustment to the exercise price and number of share options of the Company, the renewal of the general mandates and a notice convening the SGM will be despatched to the Shareholders and the Warrant Holders on or about 20 March 2000. The directors of the Company have noted the recent increases in the price and trading volume of the Shares of the Company and wish to state that we are not aware of any reasons for such increase. Save for the Share Subdivision and the other information set out in this announcement, the directors of the Company also confirm that there are no negotiations or agreements relating to intended acquisitions or realizations which are discloseable under paragraph 3 of Listing Agreement, neither is the Board aware of any matter discloseable under the general obligation imposed by paragraph 2 of the Listing Agreement, which is or may be of a price-sensitive nature. For and on behalf of the Board Hung Fung Group Holdings Limited Chan Chun Hung Chairman Hong Kong SAR, 5 March 2000