Sinco Pharmaceuticals Holdings Limited — Proxy Solicitation & Information Statement 2018

Apr 23, 2018

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about this circular or as to the action to be taken, you should consult your stockbroker or other licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Sinco Pharmaceuticals Holdings Limited, you should at once hand this circular and the accompanying 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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Sinco Pharmaceuticals Holdings Limited 興科蓉醫藥控股有限公司

(Incorporated under the laws of the Cayman Islands with limited liability)

(Stock Code: 6833)

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

A notice convening the annual general meeting of Sinco Pharmaceuticals Holdings Limited to be held at E5–1805, Global Centre, No. 1700, North Section of Tianfu Avenue, High-Tech Zone, Chengdu, Sichuan, PRC on Friday, 25 May 2018 at 9:30 a.m. is set out on pages 14 to 18 of this circular. A form of proxy for use at the annual general meeting is also enclosed. Such form of proxy is also published on the website of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the website of the Company (www.sinco-pharm.com). Whether or not you are able to attend the annual general meeting, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return it to the Hong Kong share registrar of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, 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 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.

24 April 2018

CONTENTS

		Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD
Introduction . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	3
Issue Mandate to Issue Shares . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	4
Repurchase Mandate to Repurchase Shares	. . . . . . . . . . . . . . . . . . . . . . . . . .	4
Re-election of Directors . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	4
Notice of Annual General Meeting . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	5
Form of Proxy . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	5
Voting by Poll . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	6
Recommendation . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	6
Responsibility Statement . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	6
APPENDIX I — DETAILS OF DIRECTORS
PROPOSED FOR RE-ELECTION . . . . . . . . . . . . . . . . . . .		7
APPENDIX II — EXPLANATORY STATEMENT . . . . . . . . . . . . . . . . . . . . . .		11
NOTICE OF ANNUAL GENERAL MEETING . .	. . . . . . . . . . . . . . . . . . . . . . . . . .	14

– i –

DEFINITIONS

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

• “Annual General Meeting”

• the annual general meeting of the Company to be held at E5–1805, Global Centre, No. 1700, North Section of Tianfu Avenue, High-Tech Zone, Chengdu, Sichuan, PRC on Friday, 25 May 2018 at 9:30 a.m., or any adjournment thereof and notice of which is set out on pages 14 to 18 of this circular

• “Articles of Association”

• the amended and restated articles of association of the Company adopted on 1 February 2016 and effective on 10 March 2016, and as amended from time to time

• “Board”

• the board of Directors

• “Companies Law”

• the Companies Law, Cap. 22 (Law 3 of 1961, as consolidated and revised) of the Cayman Islands as amended, supplemented or otherwise modified from time to time

• “Company”

• Sinco Pharmaceuticals Holdings Limited (興科蓉醫藥 控股有限公司), an exempted company incorporated on 16 March 2015 in the Cayman Islands with limited liability, with its shares listed on the main board of the Stock Exchange

• “Director(s)”

• the director(s) of the Company

• “Group”

• the Company and its subsidiaries

• “HK$”

• Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the PRC

• “Issue Mandate”

• a general mandate proposed to be granted to the Directors at the Annual General Meeting to allot, issue and/or deal with Shares not exceeding 20% of the number of issued Shares as at the date of passing of the relevant resolution granting the Issue Mandate

– 1 –

DEFINITIONS

• “Latest Practicable Date”

• 16 April 2018, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained in this circular

• “Listing Date” 10 March 2016, being the date on which dealings in the Shares first commenced on the Stock Exchange

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange, as amended from time to time

• “PRC” the People’s Republic of China

• “Repurchase Mandate” a general mandate proposed to be granted to the Directors at the Annual General Meeting to repurchase Shares not exceeding 10% of the number of the issued Shares as at the date of passing of the relevant resolution granting the Repurchase Mandate

• “RMB” Renminbi, the lawful currency of the PRC

• “Securities and Futures Ordinance”

• the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong, as amended from time to time

• “Share(s)”

• ordinary share(s) of nominal value of HK$0.0001 each in the share capital of the Company

• “Shareholder(s)” the holder(s) of the Share(s)

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Takeovers Code”

• the Code on Takeovers and Mergers issued by the Securities and Futures Commission of Hong Kong, as amended from time to time

• “%”

• per cent

– 2 –

LETTER FROM THE BOARD

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Sinco Pharmaceuticals Holdings Limited 興科蓉醫藥控股有限公司

(Incorporated under the laws of the Cayman Islands with limited liability)

(Stock Code: 6833)

Executive Directors: Registered office: Mr. Huang Xiangbin PO Box 309 Ms. Zhang Zhijie Ugland House Grand Cayman, KY1-1104 Independent Non-executive Directors: Cayman Islands Mr. Chow Siu Lui Mr. Wang Qing Corporate headquarters: Mr. Liu Wenfang E5-1805, Global Centre Mr. Chen David Yu No.1700, North Section of Tianfu Avenue Mr. Philip Wong Yee Teng High-Tech Zone, Chengdu Sichuan, PRC

Principal place of business in Hong Kong: Unit 4408A, 44/F, Cosco Tower 183 Queen’s Road Central Hong Kong

24 April 2018

To the Shareholders

Dear Sir or Madam

PROPOSALS FOR GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE SHARES, RE-ELECTION OF DIRECTORS

AND

NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to give you the notice of Annual General Meeting and the following proposals to be put forward at the Annual General Meeting: (a) granting of the Issue Mandate to issue Shares and the Repurchase Mandate to repurchase Shares; and (b) re-election of the Directors.

– 3 –

LETTER FROM THE BOARD

ISSUE MANDATE TO ISSUE SHARES

In order to ensure flexibility and give discretion to the Directors, in the event that it becomes desirable for the Company to issue any new Shares, approval is to be sought from the Shareholders, pursuant to the Listing Rules, for the Issue Mandate to issue Shares. At the Annual General Meeting, an ordinary resolution will be proposed to grant the Issue Mandate to the Directors to exercise the powers of the Company to allot, issue and deal with the additional Shares not exceeding 20% of the number of issued Shares as at the date of passing of the resolution in relation to the Issue Mandate.

As at the Latest Practicable Date, 1,691,890,585 Shares have been issued and fully paid. Subject to the passing of the ordinary resolution approving the Issue Mandate and on the basis that no further Shares are issued or repurchased after the Latest Practicable Date and up to the date of the Annual General Meeting, the Company will be allowed to issue a maximum of 338,378,117 Shares under the Issue Mandate.

In addition, subject to a separate approval of the ordinary resolution approving the extension of the Issue Mandate, the number of Shares purchased by the Company under Repurchase Mandate will also be added to extend the Issue Mandate. The Directors wish to state that they have no immediate plans to issue any new Shares pursuant to the Issue Mandate.

REPURCHASE MANDATE TO REPURCHASE SHARES

In addition, an ordinary resolution will be proposed at the Annual General Meeting to approve the granting of the Repurchase Mandate to the Directors to exercise the powers of the Company to repurchase Shares representing up to 10% of the number of issued Shares as at the date of passing of the resolution in relation to the Repurchase Mandate.

An explanatory statement required by the Listing Rules to be sent to the Shareholders in connection with the proposed Repurchase Mandate is set out in Appendix II to this circular.

RE-ELECTION OF DIRECTORS

As disclosed in the Company’s announcement dated 19 January 2018, Mr. Chen David Yu and Mr. Philip Wong Yee Teng have been appointed as independent non-executive Directors with effect from 19 January 2018. Pursuant to article 16.2 of the Articles of Association, any director appointed by the Board shall hold office only until the next following general meeting of the Company and shall then be eligible for re-election. Accordingly, Mr. Chen David Yu and Mr. Philip Wong Yee Teng, who were appointed as independent non-executive Directors by the Board, shall hold office only until the Annual General Meeting and, being eligible, have offered themselves for re-election at the Annual General Meeting.

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LETTER FROM THE BOARD

Pursuant to article 16.18 of the Articles of Association, (1) at every annual general meeting of the Company, one-third of the Directors for the time being shall retire from office by rotation provided that every Director shall be subject to retirement by rotation at least once every three years; (2) any director appointed by the Board shall not be taken into account in determining which Directors are to retire by rotation. Accordingly, Ms. Zhang Zhijie and Mr. Wang Qing indicated that they intend to retire at the Annual General Meeting and being eligible, will offer themselves for re-election at the Annual General Meeting.

Details of the above Directors who are standing for re-election at the Annual General Meeting are set out in Appendix I to this circular in accordance with the relevant requirements of the Listing Rules. Separate resolutions will be proposed for the re-election of each of the above Directors.

NOTICE OF ANNUAL GENERAL MEETING

Set out on pages 14 to 18 of this circular is the notice of the Annual General Meeting at which, inter alia, ordinary resolutions will be proposed to Shareholders to consider and approve the granting of the Issue Mandate to issue Shares and the Repurchase Mandate to repurchase Shares and the re-election of the Directors.

The register of members of the Company will be closed from Monday, 21 May 2018 to Friday, 25 May 2018, both days inclusive, during which no transfer of Shares will be registered, in order to determine the identity of the Shareholders who are entitled to attend and vote at the Annual General Meeting. In order to be eligible to attend and vote at the Annual General Meeting, all transfers accompanied by the relevant share certificates and transfer forms must be lodged with the Hong Kong share registrar of the Company, Computershare Hong Kong Investor Services Limited, at Shops 1712–1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong before 4:30 p.m. on Friday, 18 May 2018.

FORM OF PROXY

A form of proxy is enclosed for use at the Annual General Meeting. Such form of proxy is also published on the website of the Stock Exchange (www.hkexnews.hk) and the website of the Company (www.sinco-pharm.com). Whether or not you intend to attend the Annual General Meeting, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return it to the Hong Kong share registrar of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time fixed for holding the Annual General Meeting or any adjournment thereof. Completion and delivery of the form of proxy shall not preclude a Shareholder 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.

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LETTER FROM THE BOARD

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules and article 13.5 of the Articles of Association, any resolution put to the vote of the Shareholders at a general meeting shall be decided on a poll except where the chairman of the Annual General 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, each of the resolutions set out in the notice of Annual General Meeting will be taken by way of poll.

On a poll, every Shareholder present in person or by proxy or, in the case of a Shareholder being a corporation, by its duly authorised representative, shall have one vote for every fully paid Share of which he/she is the holder. A Shareholder entitled to more than one vote needs not use all his/her votes or cast all the votes he/she uses in the same way.

RECOMMENDATION

The Directors consider that the proposed resolutions for the granting of the Issue Mandate to issue Shares and the Repurchase Mandate to repurchase Shares and the re-election of the Directors are in the interests of the Group and the Shareholders as a whole. The Directors therefore recommend the Shareholders to vote in favour of all the resolutions to be proposed at the Annual General Meeting.

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries that, to the best of their knowledge and belief, there are no other facts, the omission of which would make any statement in this circular misleading.

Yours faithfully By order of the Board Sinco Pharmaceuticals Holdings Limited Huang Xiangbin

Chairman and Executive Director

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APPENDIX I

DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

The following are the particulars of the Directors (as required by the Listing Rules) proposed to be re-elected at the Annual General Meeting.

Save as disclosed herein, none of the following Directors holds any position with the Company or any other member of the Group, or any directorships in other public companies, the securities of which are listed on any securities market in Hong Kong or overseas in the last three years. Save as disclosed herein, the following Directors are not otherwise related to any Directors, senior management, substantial Shareholders or controlling Shareholders (as defined in the Listing Rules).

Save as disclosed herein, there is no other matter in relation to the following Directors that needs to be brought to the attention of the holders of securities of the Company and there is no other information relating to the following Directors which is required to be disclosed pursuant to any of the requirements of Rule 13.51(2)(h) to (v) of the Listing Rules.

EXECUTIVE DIRECTOR

Ms. Zhang Zhijie (張志傑) , aged 49, joined our Group in November 2013 and is an executive Director and vice president for technics of our Company, mainly responsible for new pharmaceuticals research and development. Prior to joining our Group, Ms. Zhang successively served as a postdoctoral fellow of the research center, an associate chief physician (starting from July 2013) and a research fellow (starting from December 2014) of the pharmacognosy study center of the Institute of Chinese Medical Sciences from July 2008 up until now, and was responsible for the coordination and management of the daily researches of the pharmaceutical research centre and was also involved in the process of setting up the pharmaceuticals research centre. Although Ms. Zhang is concurrently working at the Institute of Chinese Medical Sciences, she is heavily involved in the Group’s research and development programme. Ms. Zhang is leading the Group’s Sinco I programme as a research fellow for the Institute of Chinese Medical Sciences.

The Directors are of the view that Ms. Zhang has been and will continue to be able to allocate sufficient time to fulfill her duties and responsibilities as an executive Director based on the following reasons: (i) as Ms. Zhang is responsible for overseeing the Group’s new pharmaceuticals research and development, her position as a researcher at the Institute of Chinese Medical Sciences, in particular her involvement in the development of Sinco I, is directly related to her role as an executive Director. By working as a researcher at the Institute of Chinese Medical Sciences, Ms. Zhang is, at the same time, also fulfilling her responsibilities as an executive Director; (ii) to enable Ms. Zhang to allocate sufficient time to carry out her duties as an executive Director, the Group has assigned four personnel to assist Ms. Zhang with the development of Sinco I with respect to clinical trials, patent applications and manufacturing processes, including two researchers each with over 15 years of experience in the production and quality control of pharmaceuticals, a researcher with a master’s degree in clinical pharmacology specialising in the design and implementation of pharmaceutical testing and a researcher with a bachelor’s degree in business administration focusing on pharmaceutical laws who is in charge of drafting reports and registration-related matters; and (iii) Ms. Zhang has been diligently attending

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APPENDIX I

DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

the Board meetings held by the Company since she was appointed as an executive Director. In the event that Ms. Zhang is unable to attend a Board meeting in person, according to the Articles of Association, she is able to participate in such Board meeting by way of telephone conference.

Ms. Zhang served as the general manager of Zhaoye Bio-Technology Co., Ltd (兆業 生物科技有限公司), a subsidiary of Nanjing Xiaoying Pharmaceuticals Group Co., Ltd (南 京小營藥業集團有限公司), from July 2006 to October 2008, mainly responsible for new drug research and development. She has also engaged in national research projects, which involved contributing to the testing of mineral medicine and its quality control. Ms. Zhang was the co-editor of two books and published several research papers in national and international academic journals. Ms. Zhang has also been awarded Second Prize for Science and Technology by the China Association of Chinese Medicine in November 2005. Ms. Zhang obtained her Ph.D degree in June 2006 from Nanjing University of Chinese Medicine (南京中醫藥大學). Ms. Zhang worked as a pharmacist in Henan Provincial Pingdingshan City Chinese Medicine Hospital (河南省平頂山市中醫院) from September 1990 to August 2003. She obtained a bachelor’s degree in Chinese medicine from Henan University of Traditional Chinese Medicine (河南中醫學院) in July 1990.

Ms. Zhang entered into a service contract with the Company for a term of 3 years from 2 June 2015, which may be terminated by not less than three months’ notice in writing served by either party on the other and is subject to retirement by rotation and re-election at the annual general meeting of the Company in accordance with the Articles of Association. Ms. Zhang is entitled to receive a fixed director’s fee of RMB160,000 per annum, as determined by the Board with reference to the prevailing market conditions, her experience, responsibility, workload and fees paid by the comparable companies.

In accordance with the meaning of Part XV of the Securities and Future Ordinance, as at the Latest Practicable Date, Ms. Zhang is deemed to be interested in 300,000 shares representing 30% of the registered share capital of Sichuan Sinco Biotechnology Co., Ltd, an associated corporation of the Company through her 60% owned company Beijing Kang Tai Yun Dao Technology Co., Ltd..

INDEPENDENT NON-EXECUTIVE DIRECTORS

Mr. Wang Qing (汪晴) , aged 53, was appointed as an independent non-executive Director with effect from 1 February 2016, mainly responsible for supervising and providing independent judgement to the Board.

Mr. Wang worked at Dalian University of Technology (大連理工大學) from April 2003 up until now. Mr. Wang served as an associate professor when he first joined Dalian University of Technology and was later promoted to professor in November 2010 and he was responsible for research and development and teaching. From July 1986 to September 1997, Mr. Wang worked as a pharmacist supervisor at Liaoning Provincial Medical Company Limited (遼寧省藥材有限責任公司), where he was responsible for drugs inspection and evaluation and participated in research and technical renovation.

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APPENDIX I

DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

Mr. Wang obtained his Ph.D. in treatment therapy system at Kyushu Institute of Technology (九州工業大學) in Japan in March 2003 and a master’s degree in treatment therapy system at Kyushu Institute of Technology in March 2000. Mr. Wang obtained his bachelor’s degree in medicinal plants at Jilin Agricultural University (吉林農業大學) in July 1986.

Mr. Wang signed an appointment letter with the Company for a term of 3 years from 1 February 2016, which may be terminated by not less than three months’ notice in writing served by either party on the other and is subject to retirement by rotation and re-election at the annual general meeting of the Company in accordance with the Articles of Association. Mr. Wang is entitled to receive a fixed director’s fee of RMB160,000 per annum, as determined by the Board with reference to the prevailing market conditions, his experience, responsibility, workload and fees paid by the comparable companies. As at the Latest Practicable Date, Mr. Wang did not have any interest in Shares within the meaning of Part XV of the Securities and Future Ordinance.

Mr. Chen David Yu (陳宇) , aged 50, was appointed as an independent non-executive Director with effect from 19 January 2018.

Mr. Chen has been an executive director and the vice chairman of the board of directors of Hengxing Gold Holding Company Limited, a company listed on the main board of the Stock Exchange with stock code of 2303 (“ Hengxing ”), since March 2013 and the president of Hengxing since September 2013. Mr. Chen founded Huashan Capital, a venture investment company in China. He is also a venture partner at a private equity firm Tripod Capital. Mr. Chen began his career in sales marketing positions with international media companies. He has over 15 years of experience in venture investment and corporate development. Mr. Chen was an independent director of Zhonglu Co., Ltd. (中路股份有限公司), a company listed on the Shanghai Stock Exchange (stock code: 600818) from May 2009 to November 2014. He has been a non-executive Chairman of Range Resources Ltd, a company dual listed on the Australian Securities Exchange (stock code: RRS) and the AIM market of the London Stock Exchange (stock code: RRL), from December 2014 to November 2016. He is also a board member of numerous technology venture companies.

Mr. Chen obtained a Bachelor of Economics degree from Monash University in Australia in 1992.

Mr. Chen entered into a letter of appointment with the Company for an initial fixed term of three years from 19 January 2018. Either the Company or Mr. Chen may give at least three months’ written notice to the other party for early termination of the letter of appointment. Pursuant to the letter of appointment, Mr. Chen’s directorship is also subject to retirement by rotation and re-election pursuant to the Articles of Association and he is entitled to receive a director’s fee of RMB160,000 per annum, as determined by the Board based on his qualifications, experience, level of responsibilities undertaken and prevailing market conditions.

As at the Latest Practicable Date, Mr. Chen holds 2,292,000 Shares, representing approximately 0.14% of the issued share capital of the Company.

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APPENDIX I

DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

Mr. Philip Wong Yee Teng (黃已艇) , aged 40, was appointed as an independent non-executive Director with effect from 19 January 2018.

Mr. Wong has more than 15 years of international investment experience specializing in alternative investments. Mr. Wong has been serving as chief executive officer since August 2017 and as executive director since September 2017 at Pine Capital Group Ltd., a company listed on the Singapore Stock Exchange (stock code: ADJ.SI) (“ PCG ”). Mr. Wong is responsible for PCG’s strategic planning and day-to-day management decisions.

Mr. Wong has been serving on the board of directors of both Advance Capital Partners Asset Management Private Limited, a regulated fund management company regulated by the Monetary Authority of Singapore since April 2017 and Pine Asia Asset Management Inc. (“ Pine Asia ”), an asset management company regulated by the Financial Supervisory Service of South Korea, since April 2015.

Mr. Wong served as co-chief executive officer of One Asia Investment Partners, an asset and wealth management firm headquartered in Singapore, from October 2016 to January 2017. He also served as chairman and chief executive officer of Shanghai Tongjia Asset Management in the People’s Republic of China from May 2014 to January 2017.

Mr. Wong graduated from St. Ignatius of Loyola Secondary School with Ontario Secondary School Diploma in June 1997.

Mr. Wong entered into a letter of appointment with the Company for an initial fixed term of three years from 19 January 2018. Either the Company or Mr. Wong may give at least three months’ written notice to the other party for early termination of the letter of appointment. Pursuant to the letter of appointment, Mr. Wong’s directorship is also subject to retirement by rotation and re-election pursuant to the articles of association of the Company and he is entitled to receive a director’s fee of RMB160,000 per annum, as determined by the Board based on his qualifications, experience, level of responsibilities undertaken and prevailing market conditions.

As at the Latest Practicable Date, Mr. Wong did not have any interests in the Shares within the meaning of Part XV of the Securities Futures Ordinance.

– 10 –

APPENDIX II

EXPLANATORY STATEMENT

The following is an explanatory statement required to be sent to the Shareholders under the Listing Rules in connection with the proposed Repurchase Mandate.

SHARE CAPITAL

As at the Latest Practicable Date, there were a total of 1,691,890,585 Shares in issue. Subject to the passing of the resolution granting the Repurchase Mandate and on the basis that no further Shares are issued or repurchased before the Annual General Meeting, the Company will be allowed to repurchase a maximum of 169,189,058 Shares (which represent 10% of the issued Shares) during the period ending on the earlier of (i) the conclusion of the next annual general meeting of the Company; or (ii) the expiry of the period within which the next annual general meeting of the Company is required by any applicable laws or the Articles of Association to be held; or (iii) the passing of an ordinary resolution by Shareholders in general meeting of the Company revoking or varying such mandate.

REASONS FOR AND FUNDING OF REPURCHASES

The Directors believe that it is in the best interests of the Company and the Shareholders to have a general authority from the Shareholders to enable the Company to repurchase its Shares in the market. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the Company’s net asset value and/or its earnings per Share and will only be made when the Directors believe that such repurchases will benefit the Company and the Shareholders as a whole.

Repurchase of the Shares must be funded out of funds legally available for such purpose in accordance with the Articles of Association and the applicable laws of the Cayman Islands. The Directors may not repurchase the Shares on the Stock Exchange for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange. Subject to the foregoing, the Directors may make repurchases with profits of the Company or out of a new issuance of shares made for the purpose of the repurchase or, if authorized by the Articles of Association and subject to the Companies Law, out of capital and, in the case of any premium payable on the repurchase, out of profits of the Company or from sums standing to the credit of the share premium account of the Company or, if authorized by the Articles of Association and subject to the Companies Law, out of capital.

The Directors have no present intention to repurchase any Shares and they would only exercise the power to repurchase in circumstances where they consider that the repurchase would be in the best interests of the Company. The Directors believe that if the Repurchase Mandate is exercised in full, it may have a material adverse impact on the working capital or gearing position of the Company, as compared with the positions disclosed in the audited consolidated financial statements of the Company as at 31 December 2017, being the date to which the latest published audited consolidated financial statements of the Company were made up. The Directors do not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or its gearing levels which, in the opinion of the Directors, are from time to time appropriate for the Company.

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APPENDIX II

EXPLANATORY STATEMENT

DIRECTORS, THEIR CLOSE ASSOCIATES AND CORE CONNECTED PERSONS

None of the Directors nor, to the best of their knowledge, having made all reasonable enquiries, their respective close associates (as defined in the Listing Rules), have any present intention, if the Repurchase Mandate is approved by the Shareholders, to sell any Shares to the Company.

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the Repurchase Mandate in accordance with the Listing Rules, the Articles of Association and the applicable laws of the Cayman Islands.

No core connected person (as defined in the Listing Rules) has notified the Company that he or she has a present intention to sell any Shares to the Company, or has undertaken not to do so, if the Repurchase Mandate is approved by the Shareholders.

TAKEOVERS CODE

If as a result of a repurchase of Shares pursuant to the Repurchase Mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, 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 in the Shareholder’s interest, could obtain or consolidate control of the Company and thereby become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code. Save as aforesaid, the Directors are not aware of any consequences which would arise under the Takeovers Code as a result of any repurchase of Shares pursuant to the Repurchase Mandate.

As at the Latest Practicable Date, to the best knowledge and belief of the Directors, Mr. Huang Xiangbin, an executive Director, chairman and co-chief executive officer of the Company, Fullwealth Holdings Limited (“ Fullwealth ”) and Wickhams Cay Trust Company Limited (“ Wickhams ”) had deemed interests in 1,050,000,000 Shares, representing approximately 62.06% of the existing issued share capital of the Company. The 1,050,000,000 Shares were held by Risun Investments Limited, which is wholly owned by Fullwealth. Fullwealth in turn is wholly owned by a discretionary trust with Wickhams acting as the trustee and Mr. Huang as settlor of the said trust. In the event that the Directors should exercise in full the Repurchase Mandate, Mr. Huang’s, Fullwealth’s and Wickhams’s interests in the Company through Risun Investments Limited would be increased to approximately 68.96% of the issued share capital of the Company and such increase would not give rise to an obligation to make a mandatory general offer under the Takeovers Code. The Directors are not aware of any consequences which may arise under the Takeovers Code as a result of any repurchase made.

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APPENDIX II

EXPLANATORY STATEMENT

The Listing Rules prohibit a company from making repurchase on the Stock Exchange if the result of the repurchase would be that less than 25% (or such other prescribed minimum percentage as determined by the Stock Exchange) of the total number of issued shares of the Company would be in public hands. The Directors do not propose to repurchase Shares which would result in less than the prescribed minimum percentage of Shares in public hands.

SHARE REPURCHASE MADE BY THE COMPANY

No repurchases of Shares have been made by the Company during the 6 months immediately preceding the Latest Practicable Date (whether on the Stock Exchange or otherwise).

SHARE PRICES

The highest and lowest prices at which the Shares have been traded on the Stock Exchange during each of the previous 12 calendar months preceding the Latest Practicable Date were as follows:

	Highest	Lowest
Month	prices	prices
	HK$	HK$
2017
April	0.560	0.480
May	0.540	0.490
June	0.520	0.385
July	0.510	0.430
August	0.530	0.385
September	0.510	0.370
October	0.690	0.460
November	0.800	0.630
December	0.810	0.485
2018
January	0.850	0.560
February	0.750	0.520
March	0.710	0.540
April (up to and including the Latest
Practicable Date)	0.570	0.550

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NOTICE OF ANNUAL GENERAL MEETING

==> picture [82 x 39] intentionally omitted <==

Sinco Pharmaceuticals Holdings Limited 興科蓉醫藥控股有限公司

(Incorporated under the laws of the Cayman Islands with limited liability)

(Stock Code: 6833)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the annual general meeting (the “ Annual General Meeting ”) of Sinco Pharmaceuticals Holdings Limited (the “ Company ”) will be held at E5–1805, Global Centre, No. 1700, North Section of Tianfu Avenue, High-Tech Zone, Chengdu, Sichuan, PRC on Friday, 25 May 2018 at 9:30 a.m. for the following purposes:

1. To receive and adopt the audited consolidated financial statements of the Company for the year ended 31 December 2017 and the reports of the directors and auditors thereon.

2. (a) To re-elect the following directors of the Company (the “ Directors ”):

   • (i) Ms. Zhang Zhijie as executive Director;

   • (ii) Mr. Wang Qing as independent non-executive Director;

   • (iii) Mr. Chen David Yu as independent non-executive Director;

   • (iv) Mr. Philip Wong Yee Teng as independent non-executive Director; and

3. (b) To authorise the board of Directors (the “Board”) to fix the remuneration of the Directors.

4. To re-appoint Ernst & Young as auditors of the Company to hold office until the conclusion of the next annual general meeting of the Company and to authorise the Board to fix their remuneration for the year ending 31 December 2018.

5. To consider and, if thought fit, pass with or without modification the following resolutions as ordinary resolutions:

6. (A) “That:

   • (i) subject to paragraph (iii) below, the exercise by the Directors during the Relevant Period (as defined hereinafter) of all the powers of the Company to allot, issue and/or otherwise deal with

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NOTICE OF ANNUAL GENERAL MEETING

additional shares of the Company, securities convertible into shares of the Company, or options, warrants or similar rights to subscribe for any shares or such convertible securities of the Company and to make or grant offers, agreements and/or options which may require the exercise of such powers, be and is hereby generally and unconditionally approved;

• (ii) the approval in paragraph (i) above shall be in addition to any other authorisation given to the Directors and shall authorise the Directors during the Relevant Period (as defined hereinafter) to make or grant offers, agreements and/or options which may require the exercise of such power after the end of the Relevant Period;

• (iii) the aggregate number of shares of the Company allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to options or otherwise) by the Directors during the Relevant Period (as defined hereinafter) pursuant to paragraph (i) above, otherwise than pursuant to:

• (1) any Rights Issue (as defined hereinafter);

• (2) the grant or exercise of any option under any share option scheme of the Company (if applicable) or any other option, scheme or similar arrangements for the time being adopted for the grant or issue to the Directors, officers and/or employees of the Company and/or any of its subsidiaries and/or other eligible participants specified thereunder of options to subscribe for Shares or rights to acquire Shares;

• (3) any scrip dividend or similar arrangement providing for the allotment and issue of Shares in lieu of the whole or part of a dividend on Shares in accordance with the articles of association of the Company; or

• (4) any issue of Shares upon the exercise of rights of subscription or conversion under the terms of any existing convertible notes issued by the Company or any existing securities of the Company which carry rights to subscribe for or are convertible into Shares,

shall not exceed 20% of the issued share capital of the Company as at the date of the passing of this resolution and the authority pursuant to paragraph (i) of this resolution shall be limited accordingly; and

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NOTICE OF ANNUAL GENERAL MEETING

• (iv) for the purpose of this resolution:

• (a) “Relevant Period” means the period from the passing of this resolution until whichever is the earliest of:

  • (1) the conclusion of the next annual general meeting of the Company;

  • (2) the expiry of the period within which the next annual general meeting of the Company is required by any applicable laws or the articles of association of the Company to be held; and

  • (3) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the Directors by this resolution; and

• (b) “Rights Issue” means an offer of shares of the Company or an issue of warrants, options or other securities giving rights to subscribe for shares of the Company, open for a period fixed by the Directors to holders of shares of the Company on the register of members on a fixed record date in proportion to their then holdings of such shares of the Company (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, or the requirements of, or the expense or delay which may be involved in determining the exercise or extent of any restrictions or obligations under the laws of, or the requirements of, any jurisdiction applicable to the Company, any recognised regulatory body or any stock exchange applicable to the Company).”

(B) “That:

• (i) subject to paragraph (ii) of this resolution, the exercise by the Directors during the Relevant Period (as defined hereinafter) of all the powers of the Company to repurchase shares of the Company 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 which is recognised for this purpose by the Securities and Futures Commission and the Stock Exchange under the Code on Share Buy-backs and, subject to and in accordance with all applicable laws and the Rules

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NOTICE OF ANNUAL GENERAL MEETING

Governing the Listing of Securities on the Stock Exchange (the “ Listing Rules ”), be and is hereby generally and unconditionally approved;

• (ii) the aggregate number of the shares to be repurchased pursuant to the approval in paragraph (i) of this resolution shall not exceed 10% of the number of issued shares of the Company as at the date of passing of this resolution, and the said approval shall be limited accordingly; and

• (iii) for the purpose of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earliest of:

• (a) the conclusion of the next annual general meeting of the Company;

• (b) the expiry of the period within which the next annual general meeting of the Company is required by any applicable laws or the articles of association of the Company to be held; and

• (c) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the Directors by this resolution.”

• (C) “That subject to the passing of ordinary resolutions numbered 4(A) and 4(B) set out in this notice convening this meeting, the general mandate granted to the Directors to exercise the powers of the Company to allot, issue and deal with additional shares of the Company pursuant to ordinary resolution numbered 4(A) set out in the notice convening this meeting be and is hereby extended by the addition thereto of an amount representing the number of issued shares repurchased by the Company under the authority granted pursuant to ordinary resolution numbered 4(B) set out in the notice convening this meeting.”

By order of the Board Sinco Pharmaceuticals Holdings Limited

Huang Xiangbin Chairman and Executive Director

Sichuan, the PRC, 24 April 2018

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NOTICE OF ANNUAL GENERAL MEETING

Notes:

• (i) A shareholder entitled to attend and vote at the above meeting is entitled to appoint one or more proxies to attend, speak and vote in his/her/its stead. The proxy does not need to be a shareholder of the Company.

• (ii) Where there are joint registered holders of any shares, any one of such persons may vote at the above meeting (or at any adjournment of it), either personally or by proxy, in respect of such shares as if he/she/it were solely entitled thereto but the vote of the senior holder who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the vote(s) 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 relevant joint holding.

• (iii) In order to be valid, the completed form of proxy, must be deposited at the Hong Kong share registrar of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong 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 (such certification to be made by either a notary public or a solicitor qualified to practice in Hong Kong), at least 48 hours before the time appointed for holding the above meeting or any adjournment thereof (as the case may be). The completion and return of the form of proxy shall not preclude shareholders of the Company from attending and voting in person at the above meeting (or any adjourned meeting thereof) if they so wish.

• (iv) The register of members of the Company will be closed from Monday, 21 May 2018 to Friday, 25 May 2018, both days inclusive, in order to determine the eligibility of shareholders to attend the above meeting, during which period no share transfers will be registered. To be eligible to attend the above meeting, all properly completed transfer forms accompanied by the relevant share certificates must be lodged for registration with the Hong Kong share registrar of the Company, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not later than 4:30 p.m. on Friday, 18 May 2018.

• (v) In respect of resolutions numbered 2 above, the biographical details of the directors proposed to be re-elected are set out in Appendix I to the circular dated 24 April 2018.

• (vi) Pursuant to Rule 13.39(4) of the Listing Rules, voting for all the resolutions set out in this notice will be taken by poll at the above meeting.

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