Solis Holdings Limited — Proxy Solicitation & Information Statement 2022

Jan 24, 2022

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Solis Holdings Limited (the “ Company ”), 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 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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SOLIS HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2227)

MAJOR TRANSACTION IN RELATION TO THE DISPOSAL OF PROPERTY

Capitalised terms used on this cover page have the same meaning as defined in the section headed “Definitions” in this circular, unless the context requires otherwise.

A letter from the Board is set out on pages 4 to 8 of this circular.

The Disposal has been approved by written shareholders’ approval pursuant to Rule 14.44 of the Listing Rules in lieu of a general meeting of the Company. This circular is being despatched to the Shareholders for information only.

Hong Kong, 24 January 2022

CONTENTS

			Page
DEFINITIONS	. .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			4
APPENDIX I	–	FINANCIAL INFORMATION OF THE GROUP . . . . . . . . . .	I-1
APPENDIX II	–	PROPERTY VALUATION REPORT . . . . . . . . . . . . . . . . . . .	II-1
**APPENDIX III **	–	GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . .	III-1

– i –

DEFINITIONS

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

• “Board” the board of Directors of the Company

• “Close associate(s)” has the meaning ascribed thereto under the Listing Rules

• “Company” Solis Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange (stock code: 2227)

• “Completion” Completion of the Disposal in accordance with the terms and conditions of the Option Agreement

• “Consideration” the consideration in the amount of S$9,500,000 for the Disposal pursuant to the Option Agreement

• “Controlling Shareholder(s)” has the meaning ascribed thereto under the Listing Rules and means the controlling shareholders of the Company, namely, HMK Investment Holdings Limited, Mr. Tay, Mr. Tay Yong Meng and Mr. Kenneth Teo Swee Cheng (Kenneth Zhang Ruiqing)

• “Core Connected Person(s)” has the meaning ascribed thereto under the Listing Rules

• “Director(s)” the director(s) of the Company

• “Disposal” the sale and purchase of the Property pursuant to the Option Agreement

• “Group”

• the Company and its subsidiaries from time to time

• “HMK”

• HMK Investment Holdings Limited, a company incorporated in the British Virgin Islands with limited liability and the Company’s ultimate holding company, which is jointly owned by the controlling shareholdings of the Group, being Mr. Tay, Mr. Tay Yong Meng and Mr. Kenneth Teo Swee Cheng (Kenneth Zhang Ruiqing)

• “Hong Kong”

• the Hong Kong Special Administrative Region of the People’s Republic of China

– 1 –

DEFINITIONS

“Latest Practicable Date”	17 January 2022, being the latest practicable date prior	17 January 2022, being the latest practicable date prior	17 January 2022, being the latest practicable date prior
	to the printing of this circular for the purpose		of
	ascertaining certain information in this circular	prior to
	its publication
“Listing Rules”	the Rules Governing the Listing of Securities	on	the
	Stock Exchange, as amended, supplemented		or
	otherwise modified from time to time
“Mr. Tay”	Mr. Tay Yong Hua, the executive chairman, executive
	Director and the controlling shareholder	of	the
	Company
“Option”	the option to purchase the Property pursuant	to	the
	terms and conditions of the Option Agreement
“Option Agreement”	the option agreement entered into between the	Vendor
	and the Purchaser on 3 January 2022 in relation to		the
	grant and exercise of the Option
“Property”	14 Tagore Lane Singapore 787475
“Purchaser”	Soligen Construction and Engineering Pte	Ltd,	a
	company incorporated in Singapore with	limited
	liability
“SFO”	the Securities and Futures Ordinance (Chapter	571	of
	the Laws of Hong Kong) as amended, supplemented		or
	otherwise modified from time to time
“Share(s)”	ordinary share(s) of HK$0.01 each in the share	capital
	of the Company
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	the Stock Exchange of Hong Kong Limited
“Takeovers Code”	the Codes on Takeovers and Mergers and	Share
	Buy-backs
“Vendor”	Sing Moh Electrical Engineering Pte Ltd, a company
	incorporated in Singapore with limited liability	and	an
	indirect wholly-owned subsidiary of the Company,
	which is principally engaged in designing, building and
	installations of mechanical and electrical systems
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong

– 2 –

DEFINITIONS

“S$” Singapore dollars, the lawful currency of Singapore “%” per cent.

For the purpose of this circular, the exchange rate of S$1.00 = HK$5.68 has been used for currency translation, where applicable. Such an exchange rate is for illustrative purposes and does not constitute representations that any amount in HK$ or S$ has been, could have been or may be converted at such a rate.

– 3 –

LETTER FROM THE BOARD

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SOLIS HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2227)

Executive Directors:

• Mr. Tay Yong Hua (Chairman)

• Mr. Kenneth Teo Swee Cheng

(Kenneth Zhang Ruiqing) (Chief Executive Officer)

Non-executive Directors:

Registered Office:

Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Mr. Lu Xianglong

Independent Non-executive Directors:

• Mr. Cheung Garnok

• Ms. Zhang Xiuyan

• Mr. Kwong Choong Kuen (Huang Zhongquan)

Principal place of business in Hong Kong: Room 1302, 13/F., Perfect Commercial Building, No. 20 Austin Avenue, Tsim Sha Tsui, Kowloon, Hong Kong

24 January 2022

To the Shareholders

Dear Sirs or Madam,

MAJOR TRANSACTION IN RELATION TO THE DISPOSAL OF PROPERTY

INTRODUCTION

Reference is made to the announcement of the Company dated 3 January 2022. On 3 January 2022, the Purchaser accepted and exercised the Option granted by the Vendor under the Option Agreement, pursuant to which the Vendor agreed to sell, and the Purchaser agreed to purchase the Property at a consideration of S$9,500,000, subject to the terms and conditions of the Option Agreement.

– 4 –

LETTER FROM THE BOARD

THE DISPOSAL

The principal terms of the Option Agreement are set out below:

Date: 3 January 2022

• Parties: (1) Sing Moh Electrical Engineering Pte Ltd, as Vendor; and

• (2) Soligen Construction and Engineering Pte Ltd, as Purchaser.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, the Purchaser and its ultimate beneficial owner, Mr. Yan Chunlei, are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

Both the Purchaser and Vendor agreed that the Option Agreement shall constitute a binding contract for the sale and purchase of the Property between the parties and no further agreement shall be required to be entered into. The Option Agreement is not subject to fulfilment of any conditions precedent.

Property to be disposed of

The property is located at 14 Tagore Lane Singapore 787475. As at the Latest Practicable Date, the Vendor is the legal and beneficial owner of the Property. The use of the Property is office, warehouse and dormitory. Currently, the Group only uses the dormitory for its foreign workers, while the office and warehouse are leased to independent third parties. The Property will be vacated at Completion.

Consideration

The Consideration for the Disposal is S$9,500,000, which was determined after arm’s length negotiation between the Vendor and the Purchaser with reference to the market price of comparable properties at similar location and the audited carrying value of the Property as at 31 December 2020 of S$8,600,000. The estimated market value of the Property was S$8,700,000 as at 1 December 2021 with reference to the property valuation report as set out in Appendix II of this circular.

The Consideration has been/will be settled in the following manners:

• (a) S$95,000 was paid by the Purchaser to the Vendor at the time of granting the Option to the Purchaser;

• (b) S$380,000 was paid by the Purchaser to the Vendor as deposit upon the exercise and acceptance of the Option on 3 January 2022; and

• (c) S$9,025,000, being remaining balance of the Consideration, will be payable by the Purchaser to the Vendor on Completion.

– 5 –

LETTER FROM THE BOARD

Completion

Completion shall take place within twelve (12) weeks from 3 January 2022, being the date of exercise of the Option by the Purchaser.

INFORMATION OF THE GROUP

The Company was incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange. The Group is principally engaged in designing, building and installations of mechanical and electrical systems.

INFORMATION OF THE PURCHASER

The Purchaser is a company incorporated in Singapore with limited liability which is principally engaged in building construction including major upgrading works. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, the Purchaser and its ultimate beneficial owner, Mr. Yan Chunlei, are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiry, there is, and in the past twelve months, there has been, no material loan arrangement between (a) the Purchaser, any of its directors and legal representatives and/or any ultimate beneficial owner(s) of Purchaser who can exert influence on the transaction; and (b) as the Purchaser and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons, there is, and in the past twelve months, there has been, no material loan arrangement between the Company, any connected person at the Company’s level and/or any connected person at the subsidiary level (to the extent that such subsidiary/subsidiaries is/are involved in the transaction).

REASONS FOR AND BENEFITS OF THE DISPOSAL

The Directors have considered the current financial position and business operation of the Group and the overall economy and property market in Singapore, and are of the opinion that the current market presents a good opportunity for the Company and the Disposal represents a favourable opportunity to realise the further value of the Property at a reasonable price. In addition, the proceeds from the Disposal will enhance the financial position of the Group and increase the general working capital of the Group. In addition, the Group is recently tendering for projects which are of significant values and the proceeds will enhance the Group to have higher cashflows and be more liquid in cash.

The Property has been used as the Group’s dormitory, while the office and warehouse are rented to independent third parties. It is considered that the number of existing foreign workers are currently not utilizing the dormitory at full capacity, and hence it would be more cost efficient if the Group rent more dormitory spaces whenever it is necessary instead of owning a whole property. As the head office and principal place of business of the Group in Singapore is situated at 85 Tagore Lane Singapore 787527, which is owned by the Company, the Disposal will not have material impact on the operation of the Group.

– 6 –

LETTER FROM THE BOARD

The Directors (including the independent non-executive Directors) consider that the terms of the Option Agreement and the Disposal are on normal commercial terms, and believe that the Consideration is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

FINANCIAL EFFECTS OF THE DISPOSAL AND INTENDED USE OF PROCEEDS

The audited carrying value of the Property as at 31 December 2020 was approximately S$8,600,000. The Group is expected to record a gain on Disposal of approximately S$900,000, which is calculated based on the Consideration received by the Group for the Disposal less the carrying value of the Property as at 31 December 2020.

As a result of the Disposal, the consolidated net assets of the Group will be increased by approximately S$900,000.

The Group has used part of the Property as dormitory for foreign workers, and rented out the office and warehouse to independent third parties which generated rental income of S$125,500 and S$215,970 for the two years ended 31 December 2019 and 2020, respectively. Therefore, the net profits attributable to the Property was S$119,386 and S$210,267 for the two years ended 31 December 2019 and 2020, respectively.

Save for the aforementioned, the Disposal (except for related expenses) does not have any financial effect on the other asset and/or liability items of the group nor any material impact on the future earnings of the Group.

The net proceeds from the Disposal, after deducting related transaction costs, are estimated to be approximately S$9,464,000. The Company intends to use the net proceeds from the Disposal as general working capital of the Group.

IMPLICATIONS OF THE LISTING RULES

As the highest applicable percentage ratio for the Company in respect of the Disposal exceeds 25% but is less than 75%, the Disposal constitutes a major transaction for the Company and is subject to the reporting, announcement, circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

To the best of the knowledge, information and belief of the Directors, after having made all reasonable enquiries, as at the Latest Practicable Date, the Purchaser and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons.

To the best knowledge, information and belief of the Directors having made all reasonable enquiries, no Shareholder is required to abstain from voting if the Company were to convene a general meeting for the approval of the Disposal. Accordingly, pursuant to Rule 14.44 of the Listing Rules, written Shareholders’ approval may be accepted in lieu of holding a general meeting for approving the Disposal. The Company has obtained the written approval from a closely allied group of Shareholders, comprising HMK and Mr. Tay, which are beneficially interested in an aggregate of 549,792,000 Shares, representing

– 7 –

LETTER FROM THE BOARD

approximately 60.05% of the total number of issued Shares, to approve the Disposal. Mr. Tay is one of the shareholders of HMK. Accordingly, no general meeting of the Company will be convened for the purpose of approving the Disposal.

RECOMMENDATION

The Board consider that the terms and conditions of the Option Agreement are on normal commercial terms and are fair and reasonable and the Disposal is in the interests of the Company and the Shareholders as a whole. Accordingly, notwithstanding that no general meeting will be convened by the Company to approve the Disposal, the Board recommend the Shareholders to vote in favour of the relevant ordinary resolution regarding the Disposal if the Company were to convene a general meeting for the approval of the Disposal.

ADDITIONAL INFORMATION

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

Yours faithfully, For and on behalf of the Board of Solis Holdings Limited Tay Yong Hua

Executive Chairman and Executive Director

– 8 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. STATEMENT OF INDEBTEDNESS

As at the close of business on 30 November 2021, being the latest practicable date for the purpose of this statement of indebtedness prior to the publication of this circular, the Group had the following indebtedness:

(a) Banking Facilities

As at 30 November 2021, the Group’s approved banking credit facilities amounted to approximately S$6,780,000 with approximately S$2,323,000 being utilised. The Group’s banking facilities were secured by:

• (i) pledge over the Group’s freehold property;

• (ii) pledges over certain of the Group’s fixed deposits; and

(iii) corporate guarantee provided by the Company.

(b) General

Save as disclosed above and apart from intra-group liabilities and normal trade payables in the normal course of business, at the close of business on 30 November 2021, the Group did not have any other debt securities issued and outstanding or authorised or otherwise created but unissued, bank overdrafts, loans or other similar indebtedness, liabilities under acceptances (other than normal trade bills) or acceptance credits, debentures, mortgages, charges, lease liabilities, hire purchase commitments, guarantees or other material contingent liabilities.

The Directors have confirmed that, save as disclosed above, there has not been any material change in the indebtedness and contingent liabilities of the Group since 30 November 2021.

2. RECENT DEVELOPMENT AND FINANCIAL AND TRADING PROSPECT OF THE GROUP

As disclosed in the annual report of the Company, for the year ended 31 December 2020, the audited consolidated revenue was S$7.2 million (for the year ended 31 December 2019: S$19.9 million) and audited consolidated net loss after tax was S$3.1 million (for the year ended 31 December 2019: S$7.6 million).

The first half of financial year 2021 so far has proven to be as challenging as year 2020. The subsequent waves of COVID-19 during the six months ended 30 June 2021 which hit hard on the countries that form the traditional sources of construction workers in Singapore have resulted in the tightening of controls by the Singapore Government (introduction of Phase 2 – Tightened Alert on 16 May 2021) which cancelled the workers’ work-pass applications in their effort to minimise the risk of another wave of infection in our dormitories and protect the wider community. In near term, the Group expects its

– I-1 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

operations will continue to face a challenging landscape as presented by the shortage of manpower and compliance with the stringent safety requirements at work sites under COVID-19.

Given the current level of uncertainty in the construction market, the Group has also adopted a more prudent approach in tendering for new projects in view of the potential disruption in the supply chain of construction materials, driving the material prices higher. The Group will still have to cope with the lower gross profits due to the probable cost overrun of the ongoing projects and the intense competition from other contractors for new projects.

Nevertheless, the Group will continue to pay close attention to the macroeconomic environment and implement contingency plans in a timely manner. Meanwhile, it will continue to ensure smooth progress of its projects and practice tight cost controls through recovery of debts, careful utilisation of the grants and assistance from the Singapore Government, which will help defray costs incurred from prolongation of projects and compliance with the stringent pandemic safety measures. The Group will be well-equipped to rise to new challenges that may appear and will remain dedicated to preserving its market leadership while creating greater value for its shareholders.

3. WORKING CAPITAL

The Directors, after due and careful enquiry and consideration, are of the opinion that, in the absence of unforeseeable circumstances, after taking into account the Group’s business prospects, internal resources, available credit facilities and the impact of the disposal of the property, the Group has sufficient working capital for its requirements for at least twelve months from the date of this circular.

The Company has obtained the relevant confirmations as required under Rule 14.66(12) of the Listing Rules.

4. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors confirmed that there had been no material adverse change in the financial or trading position or prospects of the Group since 31 December 2020, the date to which the latest published audited financial statements of the Group were made up.

– I-2 –

PROPERTY VALUATION REPORT

APPENDIX II

Cushman & Wakefield VHS Pte. Ltd. 3 Church Street #09-03 Samsung Hub Singapore 049483 Tel +65 6535 3232 Fax +65 6535 1028 cushmanwakefield.com Company Registration No. 200709839D

24 January 2022

Solis Holdings Limited 85 Tagore Lane Singapore 787527

Dear Sirs

VALUATION OF 14 TAGORE LANE SINGAPORE 787475

Cushman & Wakefield VHS Pte. Ltd. (“Cushman & Wakefield”) have been instructed by Solis Holdings Limited (the “Client”), to provide the market value as at 1 December 2021 and valuation certificate in respect of the above mentioned property (the “Property”), for the purpose of sale.

Cushman & Wakefield have prepared valuation certificate in accordance with the requirements of the instructions and the following international definition of Market Value:

“Market Value” is the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.

The valuation certificate has been prepared in accordance with the Singapore Institute of Surveyors and Valuers’ Valuation Standards and Practice Guidelines, 2015 Edition and International Valuation Standards published by the International Valuation Standards Council (“ IVSC ”).

The valuation have been made on the assumption that the owner sells the property on the open market in its existing state, but without the benefit of any other joint venture, management agreement or any similar arrangement which would affect the value of the property.

The valuation certificate is provided with a brief description of the property together with the key factors that have been considered in determining the market value of the property. The value conclusion reflects all information known by the valuers of Cushman & Wakefield who worked on the valuation in respect to the property, market conditions and available data.

– II-1 –

PROPERTY VALUATION REPORT

APPENDIX II

The valuation contained in the valuation certificate is not a guarantee or prediction but is based on the information obtained from reliable and reputable agencies and sources, the Client and other related parties. Whilst Cushman & Wakefield have endeavored to obtain accurate information, it has not independently verified all the information provided by the Client or other reliable and reputable agencies.

Where applicable, information as to ownership, site area and zoning has been obtained from our searches at the relevant government or local authorities. Cushman & Wakefield have also relied to a considerable extent the property data provided by the Client on matters such as site and floor areas, building plans, dates of completion and all other relevant matters.

Also, in the course of the valuation, we have assumed that all the leases are legally valid and enforceable and the Property have proper legal titles that can be freely transferable, leased and sub-leased in the market without being subject to any land premium or any extra charges. Cushman & Wakefield have no reason to doubt the truth and accuracy of the information provided to us by the Client which is material to the valuation.

No allowance has been made in the valuation for any charges, mortgages or amounts owing on the property. Cushman & Wakefield have assumed that the Property are free from encumbrances, restrictions or other outgoings of an onerous nature which would affect their market value, other than those which have been made known to Cushman & Wakefield.

We have inspected the exterior of the property only due to COVID-19 restrictions on access into premises with foreign workers dormitory. No structural survey has been made, but in the course of our inspection, we did not note any serious defect to the building externally as it is relatively new. We are not, however, able to report that the Property are free from rot, infestation or any structural defect. No tests were carried out to any of the services.

We have also not carried out investigations on site in order to determine the suitability of ground conditions, nor have we undertaken archaeological, ecological or environmental surveys. Our valuation is on the basis that these aspects are satisfactory.

In arriving at our valuation, we have adopted the Comparable Sales Method. In this method, comparison is made with sales of similar property in the vicinity and in similar standard localities. Adjustments are made for differences in location, size, age and condition, and dates of transaction, amongst other factors, before arriving at the value of the Property.

Disclaimer

The valuation certificate enclosed was prepared for purposes of this circular. We specifically disclaim liability to any person in the event of any omission from or false or misleading statement included in this circular, other than in respect of the information presented in this valuation summary and certificate. We do not make any warranty or representation as to the accuracy of the information in any other part of this circular other than as expressly made or given in this valuation summary and valuation certificate.

– II-2 –

PROPERTY VALUATION REPORT

APPENDIX II

All information provided to us by the Client is treated as correct and true and we accept no responsibility for subsequent changes in information and reserve the right to change our valuation if any information provided were to materially change.

We have no present or prospective interest in the Property and are not a related corporation of nor do we have a relationship with the Client or other party/parties whom the Client is contracting with.

The valuers’ compensation is not contingent upon the reporting of a predetermined value or direction in value that favours the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event.

We hereby certify that the valuers undertaking the valuation are authorized to practice as valuers and have the necessary experience in valuing similar types of property in the respective localities.

Yours faithfully For and on behalf of Cushman & Wakefield VHS Pte. Ltd. Chew May Yenk Executive Director, Valuation & Advisory – Singapore MSISV Licensed Appraiser No AD41-2004419H

The signatory has over 32 years of valuation and consultancy experience.

Enc: Valuation Certificate

– II-3 –

PROPERTY VALUATION REPORT

APPENDIX II

VALUATION CERTIFICATE

Property held by the Group for owner-occupation in Singapore

Market value in Particulars of existing state as at Property Description and Tenure occupancy 1 December 2021 14 Tagore Lane The Property comprises a parcel of land As at the valuation date, SGD8,700,000 Singapore 787475 (Lot No. MK20-3132X) with a 4-storey the Property was intermediate terrace factory with owner-occupied. ancillary workers’ dormitory. According to information provided, the property was completed Circa 2013 with Addition and Alteration works completed Circa 2016. The Property is located along Tagore Lane, off Tagore Road, approximately 12 kilometres north from the city centre at Raffles Place. Surrounding developments are mixed in nature, comprising light industrial buildings, private housing estates and nature parks. The Property has a land area of 498.6 sq m and gross floor area of approximately 992.76 sq m (according to information provided).

The Property has an estate in perpetuity (freehold) tenure.

Notes:–

• (1) The registered proprietor for the Property is Sing Moh Electrical Engineering Pte Ltd. The Property was owner-occupied.

• (2) According to the Urban Redevelopment Authority’s Master Plan 2019, the Property is zoned for B1 industrial use, which is deemed the highest and best use of the Property.

• (3) The Property is subject to a restrictive covenant lodged on 3 November 1998.

• (4) A caveat was lodged against the Property on 15 November 2021 by Standard Chartered Bank (Singapore) Limited claiming interest as mortgagee/chargee.

• (5) According to a Grant of Written Permission (Temporary) (Decision No: P101110-28E4-E021) dated 31 January 2018 issued by Urban Redevelopment Authority (URA), the 2nd storey and part of 3rd storey of the Property was permitted to be used as temporary ancillary workers’ dormitory (49 persons) for a period of 5 years commencing from 27 October 2017. Upon expiry of the temporary permission for the temporary secondary workers’ dormitory, the premises shall be used for industrial or warehouse purposes.

• (6) An inspection of the Property was carried out by Thomas Teh, a licensed appraiser with the Inland Revenue Authority of Singapore, a member of the Singapore Institute of Surveyors & Valuers (SISV), on 26 November 2021.

– II-4 –

GENERAL INFORMATION

APPENDIX III

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERESTS

(a) Interests and short positions of directors and chief executives of the Company and its associated corporations

As at the Latest Practicable Date, the interests or short positions of the Directors and the chief executive of the Company in the Shares, underlying Shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which (i) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); or (ii) were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) contained in the Listing Rules, were as follows:

• (I) Long position in the ordinary shares and underlying shares of the Company

• (i) Interests in the Company

Interests in ordinary shares

							% of the
				Total	Total		Company’s
				interests in	interests in		issued
	Personal	Family	Corporate	ordinary	underlying	Aggregate	voting
Name of director	interests	interests	interests	shares	shares	interests	shares
Mr. Tay Yong Hua Note 1	20,000,000	–	529,792,000	549,792,000	–	549,792,000	60.05%
Mr. Kenneth Teo Swee	–	–	529,792,000	529,792,000	–	529,792,000	57.86%
Cheng Note 2
Mr. Kwong Choong	2,144,000	–	2,144,000	2,144,000	–	2,144,000	0.23%
Kuen

– III-1 –

GENERAL INFORMATION

APPENDIX III

Notes:

1. Mr. Tay Yong Hua holds 90% shares in HMK Investment Holdings Limited (“HMK”) and he is therefore deemed to be interested in the 529,792,000 Shares held by HMK under the SFO.

2. Mr. Kenneth Teo Swee Cheng holds 4% shares in HMK and he is therefore deemed to be interested in the 529,792,000 Shares held by HMK under the SFO.

3. (ii) Interests in the associated corporation

				% of the
				issued
				voting
	Name of		No. of	shares of
	associated	Capacity/	shares	associate
Name of directors	corporation	Nature	held	corporation
Mr. Tay Yong Hua	HMK	Beneficial	90	90%
		owner
Mr. Kenneth Teo	HMK	Beneficial	4	4%
Swee Cheng		owner

Save as disclosed above, as at the Latest Practicable Date, none of the directors and chief executive of the Company had any interests and short positions in the shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) as recorded in the register required to be kept under Section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to standards of dealing by Directors contained in the Listing Rules.

(b) Interests of substantial shareholders

As at the Latest Practicable Date, the following persons/entities (not being Directors or chief executive of our Company) have an interest or a short position in the shares or the underlying shares which were disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register of the Company required to be kept under section 336 of the SFO, were as follows:

Long position in the ordinary shares and underlying shares of the Company

				% of the
				Company’s
				issued
			Number of	voting
**Name **	of shareholders	Capacity	shares held	shares
HMK	Note 1	Beneficial owner	529,792,000	57.86%

– III-2 –

GENERAL INFORMATION

APPENDIX III

			% of the
			Company’s
			issued
		Number of	voting
Name of shareholders	Capacity	shares held	shares
Mr. Tay Yong Meng Note 2	Interest in a	529,792,000	57.86%
	controlled
	corporation
Ms. Lim Sim Swee	Deem interest by	549,792,000	60.05%
(“Mrs. Tay”) Note 3	virtue of interest
	held by spouse
Mr. Zheng MingQiang	Beneficial owner	67,073,714	7.33%
(“Mr Zheng”) Note 4

Notes:

1. The 529,792,000 shares are beneficially held by HMK which is owned as to 90% by Mr. Tay Yong Hua, 6% by Mr. Tay Yong Meng and 4% by Mr. Kenneth Teo Swee Cheng (Kenneth Zhang Ruiqing), and they are deemed to be interested in 529,792,000 Shares held by HMK by virtue of the SFO.

2. Mr. Tay Yong Meng holds 6% shares in HMK and he is therefore deemed to be interested in the 529,792,000 Shares held by MHK under the SFO.

3. Mrs. Tay, the spouse of Mr. Tay Yong Hua, is deemed to be interested in the interests held by Mr. Tay Yong Hua under the SFO.

4. According to the individual substantial shareholder notice filed on 8 April 2020 by Mr. Zheng, 67,073,714 Shares are beneficially held by him.

Save as disclosed above, as at the Latest Practicable Date, the Company had not been notified by any persons (other than directors or chief executive of the Company) who had interests or short positions in the shares or underlying shares of the Company which would fall under the provisions of Divisions 2 and 3 of Part XV of the SFO to be disclosed to the Company, or which were recorded in the register required to be kept by the Company under Section 336 of the SFO.

3. COMPETING BUSINESS

As at the Latest Practicable Date, none of the Directors or their respective close associates (as defined in the Listing Rules) had any interests in a business which competes or is likely to compete, either directly or indirectly, with the business of the Group.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which will not expire or be determinable by the relevant member of the Group within one year without payment of compensation (other than statutory compensation).

– III-3 –

GENERAL INFORMATION

APPENDIX III

5. DIRECTORS’ INTEREST IN ASSETS

As at the Latest Practicable Date, save as disclosed above, none of the Directors had any direct or indirect interest in any asset which had been, since 31 December 2020 (being the date to which the latest published audited consolidated financial statements of the Company were made up) and up to the Latest Practicable Date, acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Group.

6. DIRECTORS’ INTEREST IN CONTRACT

There was no contract or arrangement entered into by any member of the Group subsisting at the Latest Practicable Date in which any Director was materially interested and which was significant to the business of the Group.

7. LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or claim of material importance and no litigation or claim of material importance was known to the Directors to be pending or threatened against any member of the Group.

8. QUALIFICATION AND CONSENTS OF EXPERTS

• (a) The following is the qualification of the expert who has given opinion or advice contained in this circular:

Name

Qualification

Cushman & Wakefield VHS Pte Ltd Independent property valuer

• (b) As at the Latest Practicable Date, the above expert did not have any shareholding in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

• (c) As at the Latest Practicable Date, the above expert has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which it appear.

• (d) As at the Latest Practicable Date, the above expert did not have any interest, direct or indirect, in any assets which have been, since 31 December 2020, being the date to which the latest published audited accounts of the Company were made up, acquired or disposed of by or leased to any member of the Group, or proposed to be acquired or disposed of by or leased to any member of the Group.

– III-4 –

GENERAL INFORMATION

APPENDIX III

9. MATERIAL CONTRACTS

The following contracts (not being contracts entered into in the ordinary course of business of the Group) have been entered into by the Group within the two years immediately preceding the Latest Practicable Date which are, or may be, material:

• (a) The Option Agreement; and

• (b) The option agreement entered into between the Vendor and Chuang Xin Engineering Pte Ltd (as purchaser) on 8 October 2021 in relation to the grant of the option for the sale and purchase of 202 Tagore Lane Singapore 787591.

10. MISCELLANEOUS

• (a) The registered office of the Company is at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands.

• (b) The head office and principal place of business of the Company is at 85 Tagore Lane, Singapore, 787527.

• (c) The principal place of business in Hong Kong is at Room 1302, 13/F., Perfect Commercial Building No. 20 Austin Avenue, Tsim Sha Tsui, Kowloon, Hong Kong.

• (d) The Hong Kong branch share registrar and transfer office of the Company is Boardroom Share Registrars (HK) Limited located at Room 2103B, 21F., 148 Electric Road, North Point, Hong Kong.

• (e) The company secretary of the Company is Mr. Lee Kwok Lun, who is a member of the Association of Chartered Certified Accountants and the Hong Kong Institute of Certified Public Accountants.

• (f) The English text of this circular shall prevail over the Chinese text, in case of any inconsistency.

11. DOCUMENTS ON DISPLAY

Copies of the following documents will be published on the websites of the Stock Exchange (http://www.hkexnews.hk) and the Company (http://www.TheSolisGrp.com) from the date of this circular up to 14 days thereafter:

• (a) the valuation report from Cushman & Wakefield VHS Pte Ltd, the text of which is set out on Appendix II to this circular;

• (b) the material contracts referred to in the paragraph under the heading “Material Contracts” in this appendix; and

• (c) the written consent referred to in the paragraph headed “Qualification and Consent of Experts” in this appendix.

– III-5 –