RemeGen Co., Ltd. — Capital/Financing Update 2018

Sep 11, 2018

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

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Overseas Chinese Town (Asia) Holdings Limited 華僑城（亞洲）控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 03366)

DISCLOSEABLE TRANSACTION SALE AND LEASEBACK ARRANGEMENT

SALE AND LEASEBACK ARRANGEMENT

(I) The Acquisition Agreement

The Board is pleased to announce that on 11 September 2018 (after trading hours), OCT Financial Leasing, a wholly-owned subsidiary of the Company, entered into the Acquisition Agreement with Yibin Grace, pursuant to which OCT Financial Leasing agreed to acquire the Equipment at the consideration of RMB300 million.

(II) The Leaseback Agreement

On the same date, OCT Financial Leasing also entered into the Leaseback Agreement with Yibin Grace, pursuant to which OCT Financial Leasing agreed to lease the Equipment to Yibin Grace at the interest rate of 5.45% per annum for a term of 60 months.

LISTING RULES IMPLICATIONS

As one or more of the relevant applicable percentage ratios calculated pursuant to the Listing Rules in respect of each of the Acquisition Agreement and the Leaseback Agreement are more than 5% but less than 25%, the respective transactions contemplated thereunder constitute a discloseable transaction of the Company for the purpose of the Listing Rules and are subject to the reporting and announcement requirements but is exempt from the Shareholders’ approval requirement under Chapter 14 of the Listing Rules.

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THE ACQUISITION AGREEMENT

The Board is pleased to announce that on 11 September 2018 (after trading hours), OCT Financial Leasing, a wholly-owned subsidiary of the Company, entered into the Acquisition Agreement with Yibin Grace. The principal terms of the Acquisition Agreement are set out as follows:

Date: 11 September 2018 (after trading hours) Parties: OCT Financial Leasing (as purchaser); and

Yibin Grace (as vendor)

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, Yibin Grace and its ultimate beneficial owner are independent of and not connected with the Company and its connected persons.

Subject Matter:

Pursuant to the Acquisition Agreement, OCT Financial Leasing agreed to acquire the Equipment.

Consideration and Payment Manner:

The total consideration of the Equipment is RMB300 million. OCT Financial Leasing shall settle the consideration by two installments:

• (i) the first installment of RMB30 million shall be offset by the security deposit payable by Yibin Grace under the Leaseback Agreement; and

• (ii) the second installment of RMB270 million shall be paid by wire transfer within 7 business days after the Acquisition Agreement, the Leaseback Agreement and other related documents has become effective, and the parties having obtained the resolutions, approval, consent and authorization in relation to the transactions contemplated thereunder, and OCT Financial Leasing having received the payment notice and the relevant payment receipt issued by Yibin Grace.

The consideration will be financed from internal resources of the Group.

Basis of Consideration:

The abovementioned consideration was determined after arm’s length negotiations between OCT Financial Leasing and Yibin Grace with reference to the value of the Equipment of approximately RMB307,996,100 as at 31 August 2018 according to an asset valuation report prepared by an independent valuer using replacement cost method.

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THE LEASEBACK AGREEMENT

On 11 September 2018 (after trading hours), OCT Financial Leasing also entered into the Leaseback Agreement with Yibin Grace. The principal terms of the Leaseback Agreement are set out as follows:

Date: 11 September 2018 (after trading hours) Parties: OCT Financial Leasing (as lessor); and

Yibin Grace (as lessee)

Subject Matter:

Pursuant to the Leaseback Agreement, OCT Financial Leasing agreed to lease the Equipment to Yibin Grace.

Lease Period:

60 months commencing from the date when OCT Financial Leasing has paid the first installment of the consideration under the Acquisition Agreement to Yibin Grace.

Lease Consideration and Payment Manner:

The lease consideration payable by Yibin Grace to OCT Financial Leasing comprises:

(i) Security Deposit

Yibin Grace shall pay a security deposit of RMB30 million to OCT Financial Leasing. Such deposit will be offset against the first installment of the consideration payable by OCT Financial Leasing to Yibin Grace under the Acquisition Agreement. The security deposit can be used to offset the payables owed by Yibin Grace to OCT Financial Leasing under the Leaseback Agreement. After fulfilment of all obligations on the part of Yibin Grace under the Leaseback Agreement, OCT Financial Leasing shall refund the security deposit to Yibin Grace without interest.

(ii) Service Fee

Yibin Grace shall pay a service fee of RMB9 million to OCT Financial Leasing for the leasing service provided. Such service fee shall be paid by way of wire transfer within 7 business days from the date of the Leaseback Agreement.

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(iii) Lease Payments

The aggregate lease payments payable by Yibin Grace to OCT Financial Leasing under the Leaseback Agreement shall be approximately RMB342.9 million, comprising (i) the principal amount of RMB300 million, which is equal to the consideration under the Acquisition Agreement; and (ii) an aggregate interest of approximately RMB42.9 million, representing an annual interest rate of approximately 5.45% (subject to adjustment), payable on a quarterly basis in 20 installments during the term of the Leaseback Agreement.

The annual interest rate of 5.45% was determined by using the current benchmark loan interest rate of the People’s Bank of China plus 0.7%. If there is any change to the current benchmark loan interest rate of the People’s Bank of China, the interest rate of the next lease installments payment will be adjusted as the revised current benchmark loan interest rate plus 0.7%.

The service fee and the lease payments were determined after arm’s length negotiations between the parties to the Leaseback Agreement with reference to the prevailing market rates for finance leases for similar assets.

Ownership of the Equipment

During the term of the Leaseback Agreement, the ownership of the Equipment will vest in OCT Financial Leasing and Yibin Grace will be entitled to occupy and use the Equipment.

Upon expiry of the Leaseback Agreement and subject to full payment of all the rents and other payables by Yibin Grace under the Leaseback Agreement, OCT Financial Leasing shall transfer the ownership of the Equipment to Yibin Grace at a nominal purchase price of RMB1,000.

Conditions Precedent

The effectiveness of the Leaseback Agreement is conditional upon, inter alia, that:

• (i) The Acquisition Agreement having been signed; and

• (ii) OCT Financial Leasing having received the guarantee signed by Yibin Grace Group Company Limited (宜賓絲麗雅集團有限公司).

Guarantee

Yibin Grace Group Company Limited (宜賓絲麗雅集團有限公司), the controlling shareholder of Yibin Grace, shall provide guarantee to OCT Financial Leasing for Yibin Grace’s performance of its obligations under the Leaseback Agreement.

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Early Termination

Within the first 6 months from the date of the Leaseback Agreement, Yibin Grace shall not suspend, terminate or request to amend the Leaseback Agreement. Upon expiry of the 6-month period, Yibin Grace may terminate the Leaseback Agreement before expiry of the lease term if it has provided a one-month written notice to OCT Financial Leasing and obtained consent from OCT Financial Leasing. Subject to OCT Financial Leasing’s consent, Yibin Grace shall pay OCT Financial Leasing the early termination payment, other payables and OCT Financial Leasing’s expenses for the recovery and management of the Equipment (if any). After having received the above payments, OCT Financial Leasing will transfer the ownership of the Equipment to Yibin Grace.

The early termination payment payable by Yibin Grace shall include the followings (subject to the early termination agreement to be signed by both parties):

• (i) All lease payment payable up to the early termination date (including interest to the early termination date);

• (ii) All remaining lease principals after the early termination date;

• (iii) 20% of all remaining interest after the early termination date;

• (iv) the nominal purchase price of the Equipment.

INFORMATION ON THE EQUIPMENT

The Equipment comprise 41 type of machines or equipment which are used for the manufacturing textile related products.

As at 31 August 2018, the unaudited net asset value of the Equipment was approximately RMB308 million.

REASONS FOR AND BENEFITS OF THE SALE AND LEASEBACK ARRANGEMENT

OCT Financial Leasing principally engages in finance lease business. The Acquisition Agreement and the Leaseback Agreement are entered in the ordinary and usual course of business of OCT Financial Leasing which will bring in revenue and cash flow for the Group.

The Directors are of the view that the terms of the Acquisition Agreement and the Leaseback Agreement are agreed by the parties after arm’s length negotiation on normal commercial terms and are fair and reasonable, and the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole.

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INFORMATION ON THE GROUP, OCT FINANCIAL LEASING AND YIBIN GRACE

The principal business activity of the Company is investment holding. The Group is principally engaged in the comprehensive development business and investment in the urbanisation industrial ecosphere business.

OCT Financial Leasing is a wholly-owned subsidiary of the Company which is incorporated in the PRC. It is principally engaged in financial leasing.

Yibin Grace is a company incorporated in the PRC. It is principally engaged in the manufacture and sale of viscose filaments, staple fibers, cotton pulp (including the by-products) and textile.

LISTING RULES IMPLICATIONS

As one or more of the relevant applicable percentage ratios calculated pursuant to the Listing Rules in respect of each of the Acquisition Agreement and the Leaseback Agreement are more than 5% but less than 25%, the respective transactions contemplated thereunder constitute a discloseable transaction of the Company for the purpose of the Listing Rules and are subject to the reporting and announcement requirements but is exempt from the Shareholders’ approval requirement under Chapter 14 of the Listing Rules.

DEFINITIONS

“Acquisition Agreement”	the acquisition agreement dated 11 September 2018 entered into
	between OCT Financial Leasing and Yibin Grace in relation to the
	acquisition of the Equipment by OCT Financial Leasing
“Board”	the board of Directors
“Company”	Overseas Chinese Town (Asia) Holdings Limited, an exempted
	company incorporated in the Cayman Islands with limited
	liability, the shares of which are listed on the Main Board of the
	Stock Exchange
“connected person(s)”	has the same meaning ascribed to it under the Listing Rules
“Director(s)”	the director(s) of the Company
“Equipment”	equipment and machinery used for manufacturing textile related
	products
“Group”	the Company and its subsidiaries
“HK$” or	Hong Kong dollar, the lawful currency of Hong Kong
“Hong Kong Dollar”
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC

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“Leaseback Agreement”	the leaseback agreement dated 11 September 2018 entered into
	between OCT Financial Leasing and Yibin Grace in relation to the
	lease of the Equipment to Yibin Grace by OCT Financial Leasing
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“OCT Financial Leasing”	OCT Financial Leasing Co., Ltd (華僑城融資租賃有限公司), a
	company incorporated in the PRC with limited liability and is
	wholly-owned by the Company
“PRC”	the People’s Republic of China excluding Hong Kong, the Macau
	Special Administrative Region of the PRC and Taiwan for the
	purposes of this announcement
“RMB”	Renminbi, the lawful currency of the PRC
“Share(s)”	existing ordinary share(s) of HK$0.10 each in the issued share
	capital of the Company
“Shareholder(s)”	holder(s) of Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Yibin Grace”	Yibin Grace Co., Ltd a company incorporated in the PRC with
	limited liability

In this announcement, the English names of the PRC entities or enterprises are translation of their Chinese names. In the event of any inconsistency, the Chinese names shall prevail.

By order of the Board Overseas Chinese Town (Asia) Holdings Limited He Haibin Chairman

Hong Kong, 11 September 2018

As at the date of this announcement, the Board of the Company comprises seven Directors, including three executive Directors namely Mr. He Haibin, Ms. Xie Mei and Mr. Lin Kaihua; one non-executive Director namely Mr. Zhang Jing; three independent non-executive Directors namely Mr. Lu Gong, Ms. Wong Wai Ling, and Professor Lam Sing Kwong Simon.

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