Persistence Gold Group Ltd — AGM Information 2014

Oct 30, 2014

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 immediately.

If you have sold or transferred all your securities in APAC Resources Limited, you should at once hand this circular, together with the accompanying form of proxy, to the purchaser or other 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 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.

APAC RESOURCES LIMITED

亞 太 資 源 有 限 公 司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1104)

PROPOSALS FOR

(1) RE-ELECTION OF DIRECTORS

(2) GENERAL MANDATES TO ISSUE SECURITIES AND TO REPURCHASE SHARES

(3) REDUCTION OF SHARE PREMIUM

A notice convening the annual general meeting of APAC Resources Limited to be held at Lower Lobby, Plaza 3, Novotel Century Hong Kong Hotel, 238 Jaffe Road, Wanchai, Hong Kong on Wednesday, 3 December 2014 at 2:30 p.m. is set out on pages 16 to 20 of this circular. Whether or not you are able to attend the said meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions thereon and return the same to the branch share registrar of the Company in Hong Kong, Tricor Secretaries 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 meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the meeting or any adjourned meeting should you so desire.

• For identification purpose only

31 October 2014

CONTENTS

	Pages
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
General Mandates to Issue Securities and to Repurchase Shares . . . . . . . . . . . . . . . . . . . . . . . .	4
Reduction of Share Premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Appendix I — Details of Retiring Directors proposed to be re-elected . . . . . . . . . . . . . . .	8
Appendix II — Explanatory Statement as to Repurchase Mandate . . . . . . . . . . . . . . . . . . .	11
Appendix III — Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

– i –

DEFINITIONS

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

‘‘Act’’	the Companies Act 1981 of Bermuda;
‘‘AGM’’	the annual general meeting of the Company to be held at Lower
	Lobby, Plaza 3, Novotel Century Hong Kong Hotel, 238 Jaffe
	Road, Wanchai, Hong Kong on Wednesday, 3 December 2014 at
	2:30 p.m.;
‘‘AGM Notice’’	the notice convening the AGM as set out in Appendix III to this
	circular;
‘‘Board’’	the board of Directors;
‘‘Bye-laws’’	the bye-laws of the Company;
‘‘Company’’	APAC Resources Limited, a company incorporated in Bermuda
	with limited liability, the Shares of which are listed on the Main
	Board of the Stock Exchange (Stock Code: 1104);
‘‘Director(s)’’	the director(s) of the Company;
‘‘Group’’	the Company and its subsidiaries;
‘‘Hong Kong’’	the Hong Kong Special Administrative Region of the PRC;
‘‘Issuance Mandate’’	as defined in paragraph 3(a) of the Letter from the Board in this
	circular;
‘‘Latest Practicable Date’’	27 October 2014, being the latest practicable date prior to the
	printing of this circular for the purpose of ascertaining certain
	information included herein;
‘‘Listing Rules’’	the Rules Governing the Listing of Securities on the Stock
	Exchange;
‘‘PRC’’	the People’s Republic of China;
‘‘Reduction of Share Premium’’	the proposed reduction of an amount of HK$2,500,000,000
	standing to the credit of the share premium account of the
	Company and the transfer of such amount to the contributed
	surplus account of the Company as at the date of passing of the
	relevant special resolution at the AGM;
‘‘Repurchase Mandate’’	as defined in paragraph 3(b) of the Letter from the Board in this
	circular;

– 1 –

DEFINITIONS

‘‘SFO’’ the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong); ‘‘Share(s)’’ ordinary share(s) of HK$0.10 each in the share capital of the Company; ‘‘Shareholder(s)’’ registered holder(s) of Shares; ‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited; ‘‘Takeovers Code’’ Hong Kong Code on Takeovers and Mergers; and ‘‘%’’ per cent.

– 2 –

LETTER FROM THE BOARD

APAC RESOURCES LIMITED

亞 太 資 源 有 限 公 司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1104)

Executive Directors:

Ms. Chong Sok Un (Chairman) Mr. Andrew Ferguson (Chief Executive Officer) Mr. Kong Muk Yin

Registered office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Non-Executive Directors:

Mr. Lee Seng Hui (Mr. Peter Anthony Curry as his alternate) Mr. So Kwok Hoo

Independent Non-Executive Directors:

Dr. Wong Wing Kuen, Albert Mr. Chang Chu Fai, Johnson Francis Mr. Robert Moyse Willcocks

Head office and principal place of business: 32/F, China Online Centre 333 Lockhart Road Wanchai Hong Kong

31 October 2014

To the Shareholders

Dear Sir or Madam,

PROPOSALS FOR

(1) RE-ELECTION OF DIRECTORS

(2) GENERAL MANDATES TO ISSUE SECURITIES

AND TO REPURCHASE SHARES

(3) REDUCTION OF SHARE PREMIUM

1. INTRODUCTION

The purpose of this circular is to provide you with the information regarding resolutions to be proposed at the AGM relating to (i) the re-election of Directors, (ii) the granting to the Directors of the Issuance Mandate and Repurchase Mandate, (iii) the Reduction of Share Premium and (iv) a notice to convene the AGM to approve, among other things, the re-election of Directors, the proposal for the granting of the Issuance Mandate and Repurchase Mandate and the Reduction of Share Premium.

• For identification purpose only

– 3 –

LETTER FROM THE BOARD

2. RE-ELECTION OF DIRECTORS

Pursuant to Bye-laws 87(1) and 87(2), at each annual general meeting, one-third of the Directors for the time being (or, if their number is not a multiple of three, the number nearest to but not less than one-third) shall retire from office by rotation. A retiring Director shall be eligible for re-election. The Directors to retire by rotation shall include (so far as necessary to ascertain the number of directors to retire by rotation) any Director who wishes to retire and not to offer himself for re-election. Any further Directors so to retire shall be those of the other Directors subject to retirement by rotation who have been longest in office since their last re-election or appointment and so that as between persons who became or were last re-elected Directors on the same day those to retire shall (unless they otherwise agree between themselves) be determined by lot.

Pursuant to Bye-law 86(2), the Directors shall have power from time to time and at any time to appoint any person as a Director either to fill a causal vacancy on the Board or, subject to authorisation by the Shareholders in general meeting, as an addition to the existing Board but so that the number of Directors so appointed shall not exceed any maximum number determined from time to time by the Shareholders in general meeting. Any Director so appointed by the Board shall hold office only until the next following general meeting (in the case of filling a casual vacancy) or until the next following annual general meeting of the Company (in the case of an addition to the Board) and shall then be eligible for re-election at that meeting. Pursuant to Bye-law 87(2), any Director appointed pursuant to Bye-law 86(2) shall not be taken into account in determining which particular Directors or the number of Directors who are to retire by rotation.

In accordance with Bye-law 87, Dr. Wong Wing Kuen, Albert, Mr. Chang Chu Fai, Johnson Francis and Mr. Robert Moyse Willcocks will retire at the forthcoming AGM and, being eligible, offer themselves for re-election.

Pursuant to Rule 13.74 of the Listing Rules, a listed issuer shall disclose the details required under Rule 13.51(2) of the Listing Rules of any directors proposed to be re-elected or proposed new director in the notice or accompanying circular to its shareholders of the relevant general meeting, if such reelection or appointment is subject to shareholders’ approval at that relevant general meeting. A brief biographical details of the retiring Directors proposed to be re-elected are set out in Appendix I to this circular.

3. GENERAL MANDATES TO ISSUE SECURITIES AND TO REPURCHASE SHARES

At the annual general meeting of the Company held on 5 December 2013, ordinary resolutions were passed for the granting of general mandates to the Directors, inter alia,

• (i) to allot, issue or otherwise deal with Shares not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company as at that date (the ‘‘Existing Issuance Mandate’’); and

• (ii) to repurchase Shares representing up to a maximum of 10% of the aggregate nominal amount of the issued share capital of the Company as at that date (the ‘‘Existing Repurchase Mandate’’).

– 4 –

LETTER FROM THE BOARD

The Existing Issuance Mandate and the Existing Repurchase Mandate will lapse upon the conclusion of the AGM. The Directors consider that the Existing Issuance Mandate and the Existing Repurchase Mandate increase the flexibility in the Company’s affairs and are in the interests of the Shareholders, and that the same should continue to be adopted by the Company.

It will therefore be proposed at the forthcoming AGM to approve the granting of new general mandates to the Directors to exercise the power of the Company:

• (a) to allot, issue and deal with new Shares and to make or grant offers, agreements and options, including warrants to subscribe for Shares and other rights of subscription for or conversion into Shares, of an aggregate nominal amount not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of such resolution (the ‘‘Issuance Mandate’’); and

• (b) to repurchase Shares on the Stock Exchange of an aggregate nominal amount not exceeding 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of such resolution (the ‘‘Repurchase Mandate’’).

Assuming that there is no further issuance, allotment of and dealing in new Shares of the Company from the Latest Practicable Date to the date of AGM, a maximum of 1,225,553,598 new Shares, representing 20% of the aggregate nominal amount of the issued share capital of the Company, shall be allotted, issued and dealt with under the Issuance Mandate.

The Issuance Mandate and Repurchase Mandate will continue to be in force until the conclusion of the next annual general meeting of the Company held after the AGM or any earlier date as referred to in ordinary resolutions 4 and 5 set out in the AGM Notice. Resolutions authorising the extension of the Issuance Mandate to include the aggregate nominal amount of Shares repurchased (if any) under the Repurchase Mandate will be proposed as ordinary resolution 6 set out in the AGM Notice. With reference to the Issuance Mandate and Repurchase Mandate, the Directors wish to state that they have no immediate plan to issue any Shares or repurchase any Shares pursuant thereto.

An explanatory statement containing the particulars required by the Listing Rules to enable the Shareholders to make an informed decision on whether to vote for or against the resolution to approve the granting of the Repurchase Mandate is set out in Appendix II to this circular.

4. REDUCTION OF SHARE PREMIUM

The Board proposes to put forward to the Shareholders a proposal to reduce the share premium account of the Company by an amount of HK$2,500,000,000 and to transfer such amount to the contributed surplus account of the Company where it may be utilised as the Board considers appropriate (including to set-off the accumulated losses of the Company, which amounted to approximately HK$863,117,000 as at 30 June 2014) in accordance with the Bye-laws and all applicable laws. The proposed Reduction of Share Premium is to be effected in compliance with all applicable laws and regulations as well as the constitutional documents of the Company.

– 5 –

LETTER FROM THE BOARD

Reasons for Reduction of Share Premium

According to section 40(2) of the Act, the share premium account of the Company may be applied for limited purposes without constituting a reduction of share capital of the Company, for instance, in paying up unissued Shares to be issued to the Shareholders as fully-paid bonus Shares or in writing off expenses of an issue of Shares. Whereas the contributed surplus account of the Company is a distributable reserve which may be applied by the Company in a more general manner as the Board may think fit, including but not limited to the payment of dividends to Shareholders and elimination of accumulated losses in accordance with the Act and the Bye-laws.

The transfer of an amount to the contributed surplus account of the Company will give the Company more flexibility in the use of the Company’s funds such as for the payment of dividends to Shareholders as and when the Board considers appropriate.

In view of the current financial condition of the Group, the Directors consider that the Reduction of Share Premium is beneficial to the Company and its Shareholders as a whole.

Effect of Reduction of Share Premium

The implementation of the Reduction of Share Premium does not involve any reduction in the authorised or issued share capital of the Company nor does it involve any reduction in the nominal value of the Shares or the trading arrangements concerning the Shares. The implementation of the Reduction of Share Premium will not affect the underlying assets, business operations, management or financial position of the Group or the proportionate interests of the Shareholders, other than related expenses to be incurred which are immaterial. Save for the aforesaid expenses, the Directors consider that the Reduction of Share Premium will not cause any loss in the Shareholders’ funds and will not have a material adverse effect on the financial position of the Group.

Conditions for Reduction of Share Premium

The proposed Reduction of Share Premium is conditional upon:

• (a) the publication of a notice in Bermuda in accordance with the provisions of the Act for the Reduction of Share Premium on a date not more than 30 days and not less than 15 days before the date on which the Reduction of Share Premium is to have effect; and

• (b) on the date the Reduction of Share Premium is to be effected, there being no reasonable grounds for believing that the Company is, or after such reduction would be, unable to pay its liabilities as they become due; and

• (c) the passing of a special resolution by the Shareholders at the AGM approving the Reduction of Share Premium.

Subject to all conditions being fulfilled, the Reduction of Share Premium will take effect on the date of the AGM approving the relevant special resolution.

– 6 –

LETTER FROM THE BOARD

5. ANNUAL GENERAL MEETING

The AGM Notice is set out in Appendix III to this circular. At the AGM, ordinary resolutions will be proposed to approve, inter alia, the re-election of Directors and the granting of the Issuance Mandate and the Repurchase Mandate and a special resolution will be proposed to approve the Reduction of Share Premium.

A form of proxy is enclosed with this circular for use at the AGM. Whether or not you are able to attend this meeting, you are requested to complete and return the enclosed form of proxy to the branch share registrar of the Company in Hong Kong, Tricor Secretaries 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. Completion and return of a form of proxy will not preclude you from attending and voting at the meeting in person if you so wish.

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of shareholders at a general meeting must be taken by poll (except where the chairman of the meeting, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands). Accordingly, all resolutions to be proposed at the AGM as set out in the AGM Notice shall be voted by poll.

6. RECOMMENDATION

The Directors consider that the proposed ordinary resolutions for approval of the re-election of Directors and the granting of the Issuance Mandate and the Repurchase Mandate and the special resolution for approval of the Reduction of Share Premium are each in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors recommend that the Shareholders vote in favour of all the relevant resolutions to be proposed at the AGM.

7. GENERAL INFORMATION

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

Yours faithfully, By Order of the Board APAC Resources Limited Chong Sok Un Chairman

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DETAILS OF RETIRING DIRECTORS PROPOSED TO BE RE-ELECTED

APPENDIX I

The details of the retiring Directors proposed to be re-elected at the AGM are set out below:

Dr. Wong Wing Kuen, Albert (王永權), aged 63, has been appointed as an Independent NonExecutive Director of the Company since 6 July 2004. Dr. Wong holds a Doctor of Philosophy in Business Administration degree from the Bulacan State University, Republic of the Philippines. He is a fellow member of The Institute of Chartered Secretaries and Administrators, The Hong Kong Institute of Chartered Secretaries, The Taxation Institute of Hong Kong, Association of International Accountants and Society of Registered Financial Planners. He is a member of Hong Kong Securities Institute, The Chartered Institute of Arbitrators and The Chartered Institute of Bankers in Scotland and a full member of Macau Society of Certified Practising Accountants. Currently, Dr. Wong is the principal consultant of KND & Co. CPA Limited, a private professional accounting firm in Hong Kong. He is also an independent non-executive director of Solargiga Energy Holdings Limited (Stock Code: 757), China Merchants Land Limited (Stock Code: 978) and China VAST Industrial Urban Development Company Limited (Stock Code: 6166). These three companies are listed on the Main Board of the Stock Exchange. He is a non-executive director of Rare Earths Global Limited, which was delisted on the London Stock Exchange AIM Market on 2 May 2014.

Save as disclosed herein, Dr. Wong did not hold any directorship in other listed public companies in the past three years and does not have any relationship with any Directors, senior management, substantial or controlling Shareholders of the Company.

A letter of appointment was entered into between the Company and Dr. Wong for a term of three years which took effect from 1 June 2012. Dr. Wong is entitled to receive an annual remuneration of HK$190,000 which was determined with reference to his duties and responsibilities within the Group and the prevailing market conditions. Dr. Wong is subject to retirement by rotation and re-election at least once every three years at the annual general meeting of the Company in accordance with the Byelaws.

As at the Latest Practicable Date, Dr. Wong does not have any interest in the securities of the Company within the meaning of Part XV of the SFO.

In addition, Dr. Wong is not aware of any other matters that are required to be disclosed pursuant to Rules 13.74 and Rule 13.51(2)(a) to 13.51(2)(v) of the Listing Rules or any other matters that need to be brought to the attention of the Shareholders.

Mr. Chang Chu Fai, Johnson Francis (鄭鑄輝), aged 60, was appointed as an Independent NonExecutive Director of the Company on 6 July 2007. Mr. Chang obtained a Bachelor’s Degree in Commerce from Concordia University in Montreal, Canada in 1976 and a Master’s Degree in Business Administration from York University in Toronto, Canada in 1977. He has over 36 years of experience in banking, corporate finance, investment and management and has held various executive positions at financial institutions and directorships of listed companies. Mr. Chang is currently the Managing Director of Ceres Consultancy Limited and a registered person under the Securities and Futures Ordinance. He is also an independent non-executive director of Tian An China Investments Company Limited (Stock Code: 28) and the vice chairman and executive director of Royale Furniture Holdings Limited (Stock Code: 1198). He was the deputy chairman and an independent non-executive director of SkyOcean International Holdings Limited (formerly known as Allied Overseas Limited) (Stock Code: 593) from 28 October 2004 to 27 January 2014. These three companies are listed on the Main Board of the Stock Exchange.

– 8 –

DETAILS OF RETIRING DIRECTORS PROPOSED TO BE RE-ELECTED

APPENDIX I

Save as disclosed herein, Mr. Chang did not hold any directorship in other listed public companies in the past three years and does not have any relationship with any Directors, senior management, substantial or controlling Shareholders of the Company.

A letter of appointment was entered into between the Company and Mr. Chang for a term of three years which took effect from 1 June 2012. Mr. Chang is entitled to receive an annual remuneration of HK$190,000 which was determined with reference to his duties and responsibilities within the Group and the prevailing market conditions. Mr. Chang is subject to retirement by rotation and re-election at least once every three years at the annual general meeting of the Company in accordance with the Byelaws.

As at the Latest Practicable Date, Mr. Chang does not have any interest in the securities of the Company within the meaning of Part XV of the SFO.

In addition, Mr. Chang is not aware of any other matters that are required to be disclosed pursuant to Rules 13.74 and Rule 13.51(2)(a) to 13.51(2)(v) of the Listing Rules or any other matters that need to be brought to the attention of the Shareholders.

Mr. Robert Moyse Willcocks, aged 66, was appointed an Independent Non-Executive Director of the Company on 27 July 2007. Mr. Willcocks holds a Bachelor’s Degree in Arts and a Bachelor’s Degree in Laws from the Australian National University in Australia and a Master’s Degree in Laws from the University of Sydney in Australia. He has been an advisor to companies in the mining and resources industry for more than 31 years. He is a former partner with the law firm now called King & Wood Mallesons. He is a former director of Ban-Pu Australia Pty Ltd, Oakbridge Pty Ltd and Bond University Limited and was a member of the Australian Government’s International Legal Advisory Committee for the term of its programme. He has held directorships in a number of companies listed on the Australian Stock Exchange, including Emperor Mines Limited, RIMCapital Limited (Chairman), eStar Online Trading Limited, Energy World Corporation Limited, CBH Resources Limited, Orion Petroleum Limited (Chairman) and Mount Gibson Iron Limited (Alternate Director). He is currently an independent director of Living Cell Technologies Limited (Stock Code: LCT) and a non-executive director of ARC Exploration Limited (Stock Code: ARX), both of which are listed on the Australian Stock Exchange. He is non-executive chairman of Trilogy Funds Management Limited, a Responsible Entity under Australian Law.

Save as disclosed herein, Mr. Willcocks did not hold any directorship in other listed public companies in the past three years and does not have any relationship with any Directors, senior management, substantial or controlling Shareholders of the Company.

A letter of appointment was entered into between the Company and Mr. Willcocks for a term of three years which took effect from 1 June 2012. Mr. Willcocks is entitled to receive an annual remuneration of HK$190,000 which was determined with reference to his duties and responsibilities within the Group and the prevailing market conditions. Mr. Willcocks is subject to retirement by rotation and re-election at least once every three years at the annual general meeting of the Company in accordance with the Bye-laws.

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DETAILS OF RETIRING DIRECTORS PROPOSED TO BE RE-ELECTED

APPENDIX I

As at the Latest Practicable Date, Mr. Willcocks does not have any interest in the securities of the Company within the meaning of Part XV of the SFO.

In addition, Mr. Willcocks is not aware of any other matters that are required to be disclosed pursuant to Rules 13.74 and Rule 13.51(2)(a) to 13.51(2)(v) of the Listing Rules or any other matters that need to be brought to the attention of the Shareholders.

The Company adopted the model set out in Code Provision B.1.2(c)(ii) of Appendix 14 to the Listing Rules as its remuneration model. This model stipulates that the remuneration committee shall make recommendations to the board on the remuneration packages of individual executive directors and senior management. The remuneration committee of the Company would take into consideration, among other things, the duties and responsibilities of the Directors and the prevailing market conditions when determining their remuneration.

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EXPLANATORY STATEMENT AS TO REPURCHASE MANDATE

APPENDIX II

This appendix contains the particulars that are required by the Listing Rules to be included in an explanatory statement to enable the Shareholders to make an informed decision on whether to vote for or against the resolution to be proposed at the AGM in relation to the Repurchase Mandate.

LISTING RULES FOR REPURCHASE OF SECURITIES

The Listing Rules permit companies whose primary listings are on the Stock Exchange to repurchase their securities (which shall include, where the context permits, shares of all classes and securities which carry a right to subscribe or purchase shares) on the Stock Exchange subject to certain restrictions amongst which the Listing Rules provided that the shares proposed to be repurchased by a company must be fully-paid up and all repurchases of shares by a company with a primary listing on the Stock Exchange must be approved in advance by an ordinary resolution of shareholders either by way of general mandate to the Directors to make such repurchases or by specific approval of a particular transaction.

SHARE CAPITAL

As at the Latest Practicable Date, there were in issue an aggregate of 6,127,767,990 Shares. Subject to the passing of the proposed resolution in respect of the granting of the Repurchase Mandate and on the basis that no further Shares are issued and repurchased prior to the AGM, the Company would be permitted under the Repurchase Mandate to repurchase a maximum of 612,776,799 Shares, representing 10% of the Shares in issue as at the date of granting of the Repurchase Mandate.

REASONS FOR REPURCHASES

The Directors believe that an authority to repurchase Shares is in the best interests of the Company and the Shareholders.

Repurchases may, depending on the market conditions and funding arrangement of the Company at the time, result in an increase in earnings per share. The Directors are seeking the Repurchase Mandate so as to give the Company additional flexibility to do so if and when appropriate. The number of Shares to be repurchased on occasion and the price and other terms upon which the same are repurchased will be decided by the Directors at the relevant time having regard to the circumstances then pertaining.

While it is not possible to anticipate any specific circumstances in which the Directors might think it appropriate to repurchase Shares, Shareholders can be assured that the Directors would only make repurchases in circumstances where they consider it to be in the best interests of the Company and the Shareholders as a whole.

FUNDING OF REPURCHASES

In repurchasing Shares, the Company must fund the repurchase entirely from the Company’s available cash flow or working capital facilities legally available for such purpose in accordance with its memorandum of association and the Bye-laws, the Listing Rules and the laws of Bermuda.

The Act provides that the amount of capital paid in connection with a share repurchase may only be paid out of the capital paid up on the relevant shares, or out of funds of the Company which would otherwise be available for dividend or distribution or out of the proceeds of a fresh issue of shares made

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EXPLANATORY STATEMENT AS TO REPURCHASE MANDATE

APPENDIX II

for the purpose of the share repurchase. The Act further provides that the amount of premium (if any) payable on repurchase may only be paid out of either the funds that would otherwise be available for distribution or dividend or out of the share premium account of the Company. The shares repurchased will be treated as cancelled and the amount of the Company’s issued share capital will be diminished by the nominal value of such shares, but the aggregate amount of the Company’s authorised share capital will not be thereby reduced.

On the basis of the consolidated statement of financial position of the Company as at 30 June 2014 (being the date to which the latest published audited financial statements of the Company have been made up) and in particular the working capital position of the Group at that time and the number of Shares in issue as at the Latest Practicable Date, the Directors consider that there would not be a material adverse impact on the working capital position and the gearing position of the Group in the event that repurchases of all the Shares pursuant to the Repurchase Mandate were to be carried out in full during the proposed mandate period. However, no repurchase would be made in circumstances that would have a material adverse impact on the working capital position and the gearing position of the Group (as compared with the financial position disclosed in its latest published audited consolidated financial statements) unless the Directors consider that such repurchases are in the best interest of the Company.

DIRECTORS’ UNDERTAKING

The Directors have undertaken to the Stock Exchange to exercise the power of the Company to make repurchases pursuant to the proposed resolution in accordance with the Listing Rules and all applicable laws of Bermuda and in accordance with the memorandum of association of the Company and the Bye-laws.

DIRECTORS AND CONNECTED PERSONS

None of the Directors nor (to the best of the knowledge and belief of the Directors and having made all reasonable enquiries) any close associates (as defined in the Listing Rules) of the Directors who have any present intention, in the event that the grant to the Directors of the Repurchase Mandate is approved by the Shareholders, of selling Shares to the Company.

No core connected persons of the Company (as defined in the Listing Rules) have notified the Company that they have a present intention to sell Shares to the Company, nor have they undertaken not to sell any of Shares held by them to the Company in the event that the Company is authorised to make repurchases of Shares.

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EXPLANATORY STATEMENT AS TO REPURCHASE MANDATE

APPENDIX II

HONG KONG CODE ON TAKEOVERS AND MERGERS

If, on the exercise of the power to repurchase the Shares pursuant to the Repurchase Mandate, a Shareholder’s proportionate interest in the voting capital of the Company increases, such increase will be treated as an acquisition for the purposes of Rule 32 of the Takeovers Code and, if such increase results in a change of control, may in certain circumstances give rise to an obligation to make a mandatory offer for the securities of the Company under Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, according to the register kept by the Company pursuant to Section 336(1) of the SFO and to the best of the knowledge and belief of the Directors:

• (i) Shougang Fushan Resources Group Limited (‘‘Shougang Fushan’’), a substantial Shareholder together with parties acting in concert with it, held 956,000,000 Shares, representing approximately 15.60% of the issued share capital of the Company.

• (ii) COL Capital Limited (‘‘COL’’), a substantial Shareholder together with parties acting in concert with it, held 2,040,039,562 Shares, representing approximately 33.29% of the issued share capital of the Company. COL is 73.65% indirectly owned by Ms. Chong Sok Un and therefore Ms. Chong is deemed to have interests in the Shares in which COL is interested.

On the basis of 6,127,767,990 Shares in issue as at the Latest Practicable Date and assuming no further issue or repurchase of Shares prior to the date of the AGM, if the Repurchase Mandate were exercised in full, the shareholding percentage (if the present shareholding remains the same) of Shougang Fushan and COL, together with all their respective concerted parties would increase to approximately 17.33% and 36.99% respectively. Such increase will give rise to an obligation on the part of COL to make a general offer for all the shares not already owned by it and agreed to be acquired by it under Rules 26 and 32 of the Takeovers Code.

Save as aforesaid, the Directors are not aware of any other consequences which will arise under the Takeovers Code as a result of the exercise of the power in full under the Repurchase Mandate.

The Directors have no intention to exercise the Repurchase Mandate to an extent that the aggregate amount of the share capital of the Company in public hands would be reduced to less than 25% of the issued share capital of the Company.

– 13 –

EXPLANATORY STATEMENT AS TO REPURCHASE MANDATE

APPENDIX II

SHARE PRICES

During each of the twelve months preceding the Latest Practicable Date, the highest and lowest traded prices for Shares on the Stock Exchange were as follows:

	Share	Price
	Highest	Lowest
	HK$	HK$
2013
October	0.162	0.146
November	0.160	0.142
December	0.153	0.144
2014
January	0.166	0.136
February	0.171	0.147
March	0.170	0.153
April	0.176	0.160
May	0.194	0.168
June	0.180	0.165
July	0.185	0.163
August	0.248	0.176
September	0.255	0.180
October (up to the Latest Practicable Date)	0.212	0.190

SHARE REPURCHASE MADE BY THE COMPANY

During the six months preceding the Latest Practicable Date, the Company repurchased a total of 684,160,000 Shares at an aggregate consideration of HK$123,142,960. Details of the repurchase of such Shares are as follows:

• (a) On the Stock Exchange:

Date of Repurchase 10 July 2014 11 July 2014 14 July 2014 15 July 2014 18 July 2014 21 July 2014 Total	Price per Share No. of Shares Highest Lowest HK$ HK$ 1,760,000 0.179 0.173 460,000 0.180 0.178 120,000 0.180 0.178 100,000 0.180 0.180 20,000 0.180 0.180 1,700,000 0.180 0.179 4,160,000	Aggregate Consideration HK$ 311,320 82,680 21,460 18,000 3,600 305,900
		742,960

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EXPLANATORY STATEMENT AS TO REPURCHASE MANDATE

APPENDIX II

(b) Through a conditional cash offer:

680,000,000 Shares were repurchased at HK$0.18 per Share for an aggregate consideration of HK$122,400,000.

Save as disclosed herein, there was no other repurchase by the Company, or any of its subsidiaries, of any listed securities of the Company during the six months preceding the Latest Practicable Date.

– 15 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX III

APAC RESOURCES LIMITED

亞 太 資 源 有 限 公 司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1104)

NOTICE IS HEREBY GIVEN that the annual general meeting of APAC Resources Limited (the ‘‘Company’’) will be held at Lower Lobby, Plaza 3, Novotel Century Hong Kong Hotel, 238 Jaffe Road, Wanchai, Hong Kong on Wednesday, 3 December 2014 at 2:30 p.m. for the following purposes:

ORDINARY BUSINESS

1. To receive and adopt the audited consolidated financial statements of the Company and the reports of the directors of the Company (the ‘‘Directors’’) and the auditor of the Company for the year ended 30 June 2014.

2. (a) To re-elect the following persons:

   • i. Dr. Wong Wing Kuen, Albert as independent non-executive Director

   • ii. Mr. Chang Chu Fai, Johnson Francis as independent non-executive Director

   • iii. Mr. Robert Moyse Willcocks as independent non-executive Director

3. (b) To authorise the board of Directors (the ‘‘Board’’) to fix the Directors’ remuneration.

4. To re-appoint Deloitte Touche Tohmatsu as the auditor of the Company and to authorise the Board to fix their remuneration.

5. For identification purpose only

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NOTICE OF ANNUAL GENERAL MEETING

APPENDIX III

SPECIAL BUSINESS

ORDINARY RESOLUTIONS

The following resolutions 4 to 6 will be proposed to be considered and, if thought fit, passed as ordinary resolutions of the Company:

1. ‘‘THAT:

2. (a) subject to the provisions of paragraphs (b) and (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company (‘‘New Shares’’) and to make or grant offers, agreements and options which might require the exercise of such powers, be and is hereby generally and unconditionally approved;

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

4. (c) the aggregate nominal amount of the share capital allotted and issued or agreed conditionally or unconditionally to be allotted, issued (whether pursuant to an option or otherwise) and dealt with by the Directors pursuant to the approval in paragraph (a) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); (ii) an issue of New Shares upon the exercise of rights of subscription or conversion under the terms of warrants of the Company or any securities which are convertible into shares; (iii) an issue of New Shares as scrip dividends or similar arrangement providing for the allotment of New Shares in lieu of the whole or part of a dividend on shares of the Company in accordance with the Bye-laws of the Company from time to time; (iv) an issue of New Shares under any share option scheme or similar arrangement of the Company and/or any of its subsidiaries; or (v) a specific mandate granted by the shareholders of the Company in general meeting, shall not exceed 20% of the aggregate nominal amount of the issued share capital of the Company at the date of passing of this resolution, and the said approval shall be limited accordingly; and

5. (d) for the purpose 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 Bye-laws of the Company, the Companies Act 1981 of Bermuda (as amended from time to time) (the ‘‘Companies Act’’) or any applicable law to be held; or

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

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NOTICE OF ANNUAL GENERAL MEETING

APPENDIX III

‘‘Rights Issue’’ means the allotment, issue or grant of New Shares pursuant to an offer of New Shares open for a period fixed by the Directors to holders of issued shares of the Company (‘‘Shares’’) whose names on the register of members of the Company on a fixed record date in proportion to their then holdings of such Shares (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 restriction or obligations under the laws of, or the requirements of, any recognised regulatory body or any stock exchange in any territory applicable to the Company).’’

1. ‘‘THAT:

2. (a) subject to the provisions of paragraphs (b) and (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to repurchase the Shares on The Stock Exchange of Hong Kong Limited (the ‘‘Stock Exchange’’) or any stock exchange on which the Shares may be listed and recognised for this purpose by the Securities and Futures Commission of Hong Kong and the Stock Exchange under the Hong Kong Code on Share Buy-backs, subject to and in accordance with all applicable laws and requirements of the Rules Governing the Listing of Securities on the Stock Exchange (the ‘‘Listing Rules’’) or listing rules of any other stock exchange as amended from time to time and the Bye-laws of the Company, be and is hereby generally and unconditionally approved;

3. (b) the aggregate nominal amount of Shares hereby authorised to be repurchased by the Company pursuant to the approval in paragraph (a) above shall not exceed 10% of the issued share capital of the Company as at the date of the passing of this resolution, and the said approval shall be limited accordingly;

4. (c) for the purpose 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 Bye-laws of the Company, the Companies Act or any applicable law to be held; or

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

• ‘‘THAT conditional on the passing of resolutions 4 and 5 in the notice convening this meeting, the general mandate granted to the Directors and for the time being in force to exercise all the powers of the Company pursuant to paragraph (a) of resolution 4 above be and is hereby extended by the addition thereto an amount representing the aggregate nominal amount of the Shares repurchased by the Company under the authority granted pursuant to

– 18 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX III

paragraph (a) of resolution 5 above, provided that such extended amount shall not exceed 10% of the issued share capital of the Company as at the date of the passing of this resolution.’’

SPECIAL RESOLUTION

The following resolution will be proposed to be considered and, if thought fit, passed as a special resolution of the Company:

1. ‘‘THAT, conditional upon the compliance with the relevant legal and regulatory procedures and requirements under Bermuda laws and the Bye-laws of the Company, with effect from the date of passing this resolution, the share premium account of the Company as at the date of this resolution be reduced by an amount of HK$2,500,000,000 (the ‘‘Share Premium Reduction’’) and the entire amount of the credit arising from the Share Premium Reduction be transferred to the contributed surplus account of the Company (within the meaning of the Companies Act) where it may be utilised by the Directors in accordance with the Bye-laws of the Company and all applicable laws and any Director or officer of the Company be and is hereby authorised to execute (under the common seal of the Company if necessary and appropriate) and deliver any agreements, instruments and other documents, and do any other things and sign such documents as such director or officer shall in his/her absolute discretion deem necessary or desirable in connection with any of the matters contemplated by the foregoing.’’

By Order of the Board APAC Resources Limited Chong Sok Un Chairman

Hong Kong, 31 October 2014

Notes:

1. Any member entitled to attend and vote at the meeting is entitled to appoint a proxy or, if such member is a holder of two or more shares, proxies to attend and vote in his stead. A proxy need not be a member of the Company but must attend the meeting in person to represent the appointing member.

2. To be valid, the form of proxy must be deposited with the branch share registrar of the Company in Hong Kong, Tricor Secretaries Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for the meeting or any adjournment thereof.

3. Where there are joint holders of any share, any one of such joint holder may vote, either in person or by proxy, in respect of such share as if he were solely entitled thereto, but if more than one of such joint holders be present at the meeting, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the register of members of the Company in respect of the joint holding.

– 19 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX III

As at the date of this notice, the Directors of the Company are:

Executive Directors:

Ms. Chong Sok Un (Chairman)

Mr. Andrew Ferguson (Chief Executive Officer)

Mr. Kong Muk Yin

Non-Executive Directors:

Mr. Lee Seng Hui (Mr. Peter Anthony Curry as his alternate)

Mr. So Kwok Hoo

Independent Non-Executive Directors:

• Dr. Wong Wing Kuen, Albert

• Mr. Chang Chu Fai, Johnson Francis

Mr. Robert Moyse Willcocks

– 20 –