WH Group Limited — Share Issue/Capital Change 2018

Feb 8, 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.

This announcement appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of the Company.

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China Baoli Technologies Holdings Limited 中國寶力科技控股有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 164)

FURTHER ANNOUNCEMENT GRANT OF AWARDED SHARES UNDER THE SHARE AWARD SCHEME AND CONNECTED TRANSACTION PROPOSED ISSUE OF NEW SHARES TO CONNECTED PERSONS UNDER THE SHARE AWARD SCHEME PURSUANT TO SPECIFIC MANDATE

Reference is made to the announcement of China Baoli Technologies Holdings Limited (the “ Company ”) dated 26 January 2018 (the “ Announcement ”) in relation to the grant of Awarded Shares under the Share Award Scheme and the proposed issue of new Shares to connected persons under the Share Award Scheme pursuant to the Specific Mandate. Capitalised terms used herein have the same meanings as in the Announcement unless the context otherwise requires.

The Company wishes to provide further details of the grant as follows.

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FURTHER DETAILS OF THE SELECTED EMPLOYEES AND THEIR CONTRIBUTION TO THE GROUP

In April 2016, the Company acquired 30% equity interest in Yota, a company engaged in the design, research and development, production and marketing and sales of smartphones and other connectivity devices and was granted an exclusive intellectual property license to market and sell any connectivity devices and ancillary products in the Greater China. Since then, the Company has allocated significant resources to the development of the mobile technologies business.

During the period, the Selected Employees have made significant contributions to the development of the mobile technologies business of the Company, from the development of a new generation of the dual-screen phones to the sales and marketing and strategic cooperation with various partners. Some of the Selected Employees are from Yota Russia and Finland who work as consultants to assist in the research and development of dual-screen smartphone for the China market. The IPs and technologies surrounding the dual-screen feature of the smartphone is a unique technology with strong technical barrier. In addition, building up a mobile technologies business is not an easy task and it requires a lot of funding to expand the business. Some of the Selected Employees assisted in the fund raising by looking for and meeting with different strategic and financial partners in order to explore collaboration and cooperation opportunities.

Through the above efforts and contributions, YOTA 3 was launched in China at the end of October 2017 as stated in the interim report of the Company as at 30 September 2017. In future, the Group would continue to strengthen its research and development capabilities, improving the brand awareness and expanding customer base for its mobile technologies business.

In order to recognise the above efforts and contributions made by the Selected Employees and to provide incentives to them and to allow the Group to retain talents for the continual operation and development of the Group, the Company granted the Awards to the Selected Employees according to their seniority and contribution to the mobile technologies business.

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The Board determined to remunerate the Selected Employees (i.e. Independent Selected Employees and Connected Selected Employees) with the Awarded Shares after considering their respective roles, contributions and remuneration packages.

Among the Selected Employees, Ms. Chu Wei Ning (“ Ms. Chu ”), Mr. Yeung Chun Wai, Anthony (“ Mr. Yeung ”), Mr. Xue Wei Sen (“ Mr. Xue ”) and Ms. Huang Huang (“ Ms. Huang ”), who were appointed into the directors and/or senior management of the Company and/or certain subsidiaries between 2015 and 2018, have made remarkable contributions to the Group’s business transformation implemented in recent years together with other members of the management team and staff. The Group’s transformation into the mobile technologies business is essential to the Group’s future sustainability, given the gloomy performance of the Group’s tourism and hospitality (especially the management of cruise ship) business. As such, the contributions made by the new management have not just growth potentials but have also re-engineered the Group in a broader and long-term context by introducing a more competitive strategic focus and positioning of the Group’s businesses.

Leveraging their professional expertise, solid experience and business network, the new management has significantly contributed to a series of major developments in connection with the Group’s business transformation, which include (i) the successful acquisition of 30% equity interest of Yota and an exclusive intellectual property licence to market and sell “YOTAPHONE” in the Greater China Region for 7 years announced in April 2016; (ii) the framework agreement in relation to the strategic cooperation with Shanghai Yuewen Information Technology Co., Ltd. as announced in July 2017; (iii) the launch of the third generation of dual-screen smartphone, YOTA 3, in October 2017 at one of the leading online retailers channel JD.com in the People’s Republic of China (the “ PRC ”); and (iv) the cooperation in relation to the development of the YotaPhone with People’s Government of Tongnan County of Chongqing City in the PRC.

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Ms. Chu sits on the board of Yota on behalf of the Company. She is responsible for the Group’s overall business development, formulation of growth strategies in the Group’s mobile technologies business, identification and analysis of suitable investment opportunities, strategic partnership discussion and monitoring of the Group’s continuous sustainability and profitability. Mr. Xue is responsible for the business development of the Group’s mobile technologies business in the PRC, identification of suitable business opportunities, conduct of commercial negotiations with business partners and supervision of the business operations of certain subsidiaries of the Company. Ms. Huang is responsible for the fund raising activities, leveraging her solid experience and strong business network to seek different investors for the mobile communications business so as to provide sufficient fund to expand the business. Mr. Yeung is responsible for the Group’s business development, identification and analysis of suitable investment opportunities and fund raising activities. He has proven track records and extensive experience in corporate restructuring and rescuing, consulting, corporate finance and business negotiation with well-versed business and people network.

Selected Employees No. 10-38 referred to in the Announcement belong to the mobile technologies business of the Group. They work in Hong Kong, the PRC, Russia and Finland. Mr. Xue is a director of certain subsidiaries of the Company in the mobile technologies business.

To the best knowledge, information and belief of the Directors, none of the Selected Employees has any relationship with the two vendors (and their associates) of the Company’s acquisition/proposed acquisition as announced on 26 January and 11 August 2017.

The Board is of the view that the grant of the Awarded Shares to the management and staff is justifiable having considered their contributions to the Group’s long-term competitiveness and growth potential. Furthermore, the independent financial adviser has been appointed to give an independent opinion for the award of the Connected Awarded Shares to the Connected Selected Employees.

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The number of Awarded Shares granted to each of the Connected Selected Employees is as follows:

	Number of
Name	Awarded Shares	Note
1. Zhang Yi	800,000	with lock up period
2. Chu Wei Ning	300,000,000	with lock up period
3. Yeung Chun Wai, Anthony	300,000,000	with lock up period
4. Wong King Shiu, Daniel	800,000	with lock up period
5. Chan Chi Yuen	800,000	with lock up period
6. Chan Kee Huen, Michael	250,000
7. Wong Hoi Kuen	800,000	with lock up period
8. Han Chunjian	250,000
9. Xue Wei Sen	300,000,000	with lock up period

Note: Such Connected Selected Employees shall undertake to the Company that from the issue date to the date falling six months after the issue date of the Awarded Shares (both dates inclusive) (the “ First Six-month Period ”), each of them shall not transfer or dispose of the Awarded Shares held by each of them and from the day next immediately after the First Six-month Period to the date falling twelve months after the issue date of the Awarded Shares (both dates inclusive), each of them shall not transfer or dispose of 50% of the Awarded Shares held by each of them.

APPOINTMENT OF INDEPENDENT FINANCIAL ADVISER

As mentioned in the Announcement, an independent financial adviser will be appointed to advise the Independent Shareholders in relation to the award of the Connected Awarded Shares to the Connected Selected Employees. Well Link International Capital Limited has been engaged as the independent financial adviser in this regard.

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SHAREHOLDING STRUCTURE

To the best knowledge, information and belief of the Directors, the shareholding structure of the Company as at the date of this announcement and immediately after the issuance of the Awarded Shares (assuming no other change in the issued share capital of the Company other than the issuance of the Awarded Shares) is as follows:

			Immediately after the	Immediately after the
			issuance of the Awarded
			Shares (assuming no
			other change in the
	As at the	date	issued share capital
Name of shareholder	of this announcement		of the Company)
		% to the total		% to the total
	Number of	issued	Number of	issued
	Shares	share capital	Shares	share capital
Lui Lai Yan (Note 1)	152,000,000	0.44%	152,000,000	0.43%
Yeung Chun Wai, Anthony (Note 1)	748,112,205	2.17%	1,048,112,205	2.95%
Rising Elite Global Limited (Note 1)	90,000,000	0.26%	90,000,000	0.25%
Nova Investment Group Limited (Note 1)	1,521,007,187	4.41%	1,521,007,187	4.28%
Sub-total	2,511,119,392	7.28%	2,811,119,392	7.91%
Zhang Yi (Note 2)	–	0.00%	800,000	0.00%
One Faith Investments Limited (Note 2)	2,153,475,000	6.24%	2,153,475,000	6.06%
Sub-total	2,153,475,000	6.24%	2,154,275,000	6.06%
Chu Wei Ning (Note 3)	–	0.00%	300,000,000	0.85%
Wong King Shiu, Daniel (Note 3)	200,000	0.00%	1,000,000	0.00%
Chan Chi Yuen (Note 3)	4,750,000	0.01%	5,550,000	0.02%
Chan Kee Huen, Michael (Note 3)	–	0.00%	250,000	0.00%
Wong Hoi Kuen (Note 3)	–	0.00%	800,000	0.00%
Han Chunjian (Note 3)	–	0.00%	250,000	0.00%
Public Shareholders
Other Selected Employees	737,275,000	2.14%	1,164,115,000	3.28%
Other public shareholders	29,098,225,062	84.33%	29,098,225,062	81.88%
Sub-total	29,835,500,062	86.47%	30,262,340,062	85.16%
Total	34,505,044,454	100%	35,535,584,454	100%

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Notes:

• (1) Mr. Yeung Chun Wai, Anthony is an executive Director. Rising Elite Global Limited and Nova Investment Group Limited is beneficially wholly owned by Mr. Yeung Chun Wai, Anthony. Ms. Lui Lai Yan is the spouse of Mr. Yeung Chun Wai, Anthony.

• (2) Mr. Zhang Yi is an executive Director and the Chairman of the Board. One Faith Investments Limited is beneficially wholly owned by Mr. Zhang Yi.

• (3) Each of Ms. Chu Wei Ning, Mr. Wong King Shiu, Daniel, Mr. Chan Chi Yuen, Mr. Chan Kee Huen, Michael, Mr. Han Chunjian and Mr. Wong Hoi Kuen is a Director.

By order of the Board China Baoli Technologies Holdings Limited Zhang Yi Chairman

Hong Kong, 8 February 2018

As at the date of this announcement, the executive Directors are Mr. Zhang Yi (Chairman), Ms. Chu Wei Ning (Chief Executive Officer), Mr. Yeung Chun Wai, Anthony and Mr. Wong King Shiu, Daniel; and the independent non-executive Directors are Mr. Chan Chi Yuen, Mr. Chan Kee Huen, Michael, Mr. Han Chunjian and Mr. Wong Hoi Kuen.

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