Yantai North Andre Juice Co. Ltd. - Proxy Solicitation & Information Statement 2012

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Yantai North Andre Juice Co., Ltd.* , you should at once hand this circular, the enclosed form of proxy and reply slip to the purchaser or the transferee or to the bank, licensed dealer in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or the 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.

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 02218)

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT; PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

NOTICE OF SPECIAL GENERAL MEETING

INDEPENDENT FINANCIAL ADVISER TO THE INDEPENDENT BOARD COMMITTEE AND THE INDEPENDENT SHAREHOLDERS IN RELATION TO THE PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

A letter from the Board of the Company is set out on pages 4 to 10 of this circular. A letter from the Independent Board Committee of the Company is set out on pages 11 to 12 of this circular. A letter from the Independent Financial Adviser is set out on pages 13 to 19 of this circular, which contains its recommendations to the Independent Board Committee and the Independent Shareholders in relation to the proposed revision of the existing annual caps for the Product Purchase Framework Agreement.

The notice convening the SGM to be held at 2nd Floor, No. 18 Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC at 10:00 a.m. on Monday, 26 November 2012 is set out on pages 27 to 28 of this circular.

Whether or not you are able to attend such meeting, you are required to complete and sign the enclosed form of proxy in accordance with the instructions printed thereon. For H Shareholders, the proxy form shall be delivered to the Company’s H Share registrar, Tricor Tengis Limited at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong; and for Domestic Shareholders, the proxy form shall be delivered to the registered office of the Company at No. 18 Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC as soon as possible but in any event not later than 24 hours before the time appointed for the holding of the SGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjournment thereof if you so wish.

If you wish to attend the SGM in person or by proxy, you are required to complete and return the reply slip to the principal place of business of the Company in Hong Kong (for H Shareholders) or to the registered office of the Company (for Domestic Shareholders) on or before Monday, 5 November 2012.

* For identification purpose only

10 October 2012

		Page
DEFINITIONS	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM	THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
LETTER FROM	THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . .	11
LETTER FROM	MESSIS CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
APPENDIX I	– PROPOSED AMENDMENTS TO THE ARTICLES
	OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
APPENDIX II	– GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . .	21
NOTICE OF SPECIAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . .		27

– i –

DEFINITIONS

Unless the context otherwise requires, capitalized terms used in this circular shall have the following meanings:

“Articles of Association”

the articles of association of the Company

“Board”
the board of directors of the Company
“Company”
Yantai North Andre Juice Co., Ltd.*（烟台北方安德利果汁股份有限公司）, a joint stock company incorporated in the PRC with limited liability and whose H shares were initially listed on the Growth Enterprise Market of the Stock Exchange on 22 April 2003 and have been listed on the Main Board of the Stock Exchange since 19 January 2011 by way of transfer of listing from the Growth Enterprise Market of the Stock Exchange
“Company Law”
the Company Law of the People’s Republic of China (as amended from time to time)
“Director(s)”
the director(s) of the Company
“Domestic Share(s)”
the domestic invested share(s) in the share capital of the Company with a nominal value of RMB0.10 each, which are held in Renminbi
“Domestic Shareholder(s)”
the holder(s) of Domestic Shares
“Group”
the Company and its subsidiaries
“H Share(s)”
the overseas listed foreign share(s) in the ordinary share capital of the Company with a nominal value of RMB0.10 each listed on the Stock Exchange and traded in HK$ (Stock Code: 02218)
“H Shareholder(s)”
the holder(s) of H Shares
“HK$”
Hong Kong Dollars, the lawful currency of Hong Kong
“Hong Kong”

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

– 1 –

DEFINITIONS

“Independent Board Committee”
“Independent Financial Adviser”
“independent non-executive Director(s)”
“Independent Shareholder(s)”
“Latest Practicable Date”
“PRC”

“President”

“Product Purchase Framework Agreement”
“RMB”
“SGM”

“Shareholder(s)”

the board committee comprised of independent non-executive Directors, namely Ms. Yu Shou Neng, Ms. Qu Wen, Mr. Gong Fan and Mr. Chow Kam Hung for the purpose of advising the Independent Shareholders on the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) and connected transactions
the independent financial adviser to the Independent Board Committee and the Independent Shareholders
independent non-executive director(s) of the Company
Shareholder(s) other than President, a connected person of the Company, and its associates
7 October 2012, being the latest practicable date for ascertaining certain information contained in this circular prior to its publication
the People’s Republic of China, excluding, for the purpose of this circular only, Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan
President Enterprises (China) Investment Co., Ltd., a limited liability company established in the PRC and a substantial shareholder and a connected person of the Company which holds 15.59% equity interests in the Company as at the Latest Practicable Date
the Product Purchase Framework Agreement dated 30 March 2012 entered into between the Company and President, pursuant to which President agreed to purchase and the Company agreed to supply the Company’s products (including, but not limited to, different kinds of juice) for the three financial years ending 31 December 2014

Renminbi, the lawful currency of the PRC

the special general meeting of the Company to be held at 2nd Floor, No. 18 Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC at 10:00 a.m. on Monday, 26 November 2012

the registered holder(s) of shares of the Company

– 2 –

	DEFINITIONS
“Share(s)”	the ordinary share(s) of the Company of RMB0.10
	each, including Domestic Share(s) and H Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Supplemental Agreement”	a supplemental agreement to the Product Purchase
	Framework Agreement dated 17 September	2012
	entered into between the Company and President
“%”	percentage

– 3 –

LETTER FROM THE BOARD

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2218)

Executive Directors: Mr. Wang An Mr. Zhang Hui Mr. Wang Yan Hui

Non-executive Director: Mr. Lin Wu-Chung Mr. Liu Tsung-Yi

Independent non-executive Directors: Ms. Yu Shou Neng Ms. Qu Wen Mr. Gong Fan Mr. Chow Kam Hung

Registered Office: No. 18 Andre Avenue Muping Economic Development Zone Yantai City Shandong Province the PRC

Principal Place of Business in Hong Kong: Unit 2805, 28/F The Center 99 Queen’s Road C Hong Kong

10 October 2012

To the Shareholders

Dear Sir or Madam,

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT; PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND NOTICE OF SPECIAL GENERAL MEETING

1. INTRODUCTION

Reference is made to the announcements of the Company dated 18 June 2012 and 17 September 2012, in relation to, (1) proposed amendments to the Articles of Association; and (2) proposed revision of the annual caps for each of the three years ending 31 December 2014 for the transactions under the Product Purchase Framework Agreement.

The purpose of this circular is to provide you with further information and the recommendations of the Board in respect of the proposed amendments to the Articles of Association and the proposed revision of the annual caps for each of the three years ending 31 December 2014 for the transactions under the Product Purchase Framework Agreement to enable you to make an informed decision on whether to vote for or against the proposed resolutions at the SGM.

* For identification purpose only

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LETTER FROM THE BOARD

2. PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

2.1 BACKGROUND

Reference is made to the announcements of the Company dated 30 March 2012 and 17 September 2012.

On 30 March 2012, the Company entered into the Product Purchase Framework Agreement with President, whereby President agrees to purchase and the Company agrees to supply the Company’s products (including but not limited to different kinds of juice), to regulate such product purchase between the Group and President for the three financial years ending 31 December 2014. More than approximately 90% of the products to be supplied by the Company to President under the Product Purchase Framework Agreement will be pear juice concentrate, while less than approximately 10% will be apple juice concentrate. Therefore, the annual caps for the relevant transactions are mainly determined with reference to the demand on pear juice concentrate from President. President will settle the invoices on the 45th day upon the receipt of the same.

The existing annual caps for the three years ending 31 December 2014 for the transactions under the Product Purchase Framework Agreement is RMB60,000,000, RMB72,000,000 and RMB86,000,000, respectively.

Based on internal estimation, the Directors are of the view that the existing 2012, 2013 and 2014 annual caps for the transactions under the Product Purchase Framework Agreement will not be sufficient for the Group’s current requirements. Therefore, the Company entered into the Supplemental Agreement with President on 17 September 2012 to revise the 2012, 2013 and 2014 annual caps to RMB100,000,000, RMB200,000,000 and RMB270,000,000, respectively. The effectiveness of the Supplemental Agreement is subject to the approval of the independent shareholders of the Company. Other than the above change, all existing terms and conditions of the Product Purchase Framework Agreement have remained unchanged. In arriving at such revised annual caps, the Directors have considered the following factors:

(i) the historical figure for the eight months ended 31 August 2012 was approximately RMB47,300,000 and it is estimated that the sales volume of the pear juice concentrate will increase significantly in 2012. The main reason for such increase is that President has developed a new product, the crystal sugar pear drink, which the Company’s pear juice concentrate is the major ingredient of such new product. For the first three quarters of 2012, President has received an approximately 200% increase in its orders on crystal sugar pear drink than that of the entire 2011, and President expects that the orders will continue to increase significantly starting from the forthcoming winter due to the peak season for the Chinese new year period, which results in a substantial increase in the sales volume of the Company’s pear juice concentrate;

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LETTER FROM THE BOARD

(ii) President’s crystal sugar pear drink was launched to the market in March 2011. The sales of such product are very promising and the market share in the PRC has increased from approximately 0.1% since then to approximately 4.3% as at the end of August 2012. Consequently, it is estimated that the sales volume of the Company’s pear juice concentrate with President will increase significantly in the three financial years ending 31 December 2014;
(iii) the Directors have discussed with President relating to the sales of its crystal sugar pear drink and its demand for the Company’s pear juice concentrate between 2012 and 2014. With reference to the proposed orders from President, the demand in terms of sales volume on the Company’s pear juice concentrate will increase by approximately 38% as compared with the amount originally contemplated in the existing annual caps for the year 2012. With reference to the internal forecast of President, the demand will further increase by approximately 100% and 33% in the years 2013 and 2014 respectively; and
(iv) the sales price based on the prevailing market prices of the Company’s products has also increased in 2012 due to the increase in the costs for the production of the Company’s products, such as the raw materials and labor costs, and there may be further increase by approximately 3% for each of the years 2013 and 2014.

The Company will ensure that the existing annual cap for the year ending 2012 for transactions under the Product Purchase Framework Agreement will not be exceeded before obtaining the independent shareholders’ approval, as required under Rule 14A.36 of the Listing Rules.

2.2 REASONS FOR THE CONTINUING CONNECTED TRANSACTIONS

The demand for the Company’s products (including pear juice concentrate) by President has increased substantially with the development of new products by President with the Company’s products as ingredients, while at the same time, the Company has sufficient production capacity and raw materials for production to satisfy the increase in demand by President. The supply of the Company’s products to President in the PRC will lower the freight costs as well as the exchange risks as compared to sales of the same products overseas. Besides, the supply of the Company’s products to President can expand the Company’s share in the domestic markets by maintaining close and stable business relationships with certain renowned beverage manufacturers in the PRC and broadening sales channels. Therefore, the Directors are of the opinion that the Product Purchase Framework Agreement as amended by the Supplemental Agreement is beneficial in raising the proportion of domestic sales of the Company’s pear juice products as well as product diversification, which will in turn increase the revenue and profits of the Company. For the same reasons, the Company is of the view that it is in the best interest of the Company and the Shareholders as a whole to give first priority to the purchase by President in the event that the purchase terms are the same as those of third parties.

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LETTER FROM THE BOARD

The Board (including the independent non-executive Directors, whose opinion is formed after taking into account the advice provided by the Independent Financial Adviser) considers that the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement are in the usual and ordinary course of business of the Company, and terms of which are fair and reasonable and in the interests of the Company and the shareholders as a whole.

The Board (including the independent non-executive Directors, whose opinion is formed after taking into account the advice provided by the Independent Financial Adviser) further considers that, the proposed revised annual caps for the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement for the three years ending 31 December 2014 are fair and reasonable.

Mr. Lin Wu-Chung and Mr. Liu Tsung-Yi, the Directors, have abstained from voting on the board resolution approving the Supplemental Agreement due to their management positions in President. Save as mentioned above, none of the Director has material interest in the transactions and hence no other Director has abstained from voting on such board resolution.

2.3 LISTING RULES IMPLICATIONS

As at the Latest Practicable Date, President holds 637,460,401 Domestic Shares of the Company, representing 15.59% of the total issued share capital of the Company. Under the Listing Rules, President is a substantial shareholder of the Company and thus is a connected person of the Company. Therefore, the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement between the Group and President constitute continuing connected transactions of the Company.

Since the applicable percentage ratios (other than the profit ratio) for the highest proposed revised annual caps for each of the three years ending 31 December 2014 for the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement are more than 5%, the continuing connected transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement are subject to the announcement, reporting and independent shareholders’ approval requirements under Rules 14A.45 to 14A.48 of the Listing Rules.

2.4 GENERAL INFORMATION

The Company is a joint stock limited company incorporated in the PRC with limited liability and whose H shares have been listed on the Stock Exchange, initially on the Growth Enterprise Market, since 22 April 2003. The Company has been listed on the Main Board of the Stock Exchange since 19 January 2011 by way of transfer of listing from the Growth Enterprise Market of the Stock Exchange. The Company is principally engaged in the business of manufacturing and sale of apple juice concentrate, pear juice concentrate, apple essence, bio-feedstuff and related products.

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LETTER FROM THE BOARD

President is a limited liability company established under the PRC laws and is principally engaged in the production and sales of beverages, a variety of food that uses flour as raw material, such as instant noodles, dairy products, processed meat products, seasoning and food sauces, biscuits and pastries, as well as other food and beverage products. As at the Latest Practicable Date, President holds 637,460,401 Domestic Shares of the Company, representing 15.59% of the total issued share capital of the Company.

Pursuant to Rule 14A.59(5) of the Listing Rules, where independent shareholders’ approval is required with regard to a connected transaction, any connected person with a material interest in such transaction and any shareholder with a material interest in such transaction and its associates, will not vote on such transaction. Accordingly, President and associate(s) (as defined under the Listing Rules) shall at the SGM abstain from voting on the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement and the proposed revised annual caps for the three years ending 31 December 2014, which will be taken on a poll as required under the Listing Rules. To the extent that the Company is aware having made all reasonable enquiries, as at the Latest Practicable Date:

(i) there was no voting trust or other agreement, arrangement or understanding entered into by or binding upon President;
(ii) President was not subject to any obligation or entitlement whereby it had or might have temporarily or permanently passed control over the exercise of the voting right in respect of its shares in the Company to a third party, whether generally or on a case-by-case basis; and
(iii) it was not expected that there would be any discrepancy between President’s beneficial shareholding interest in the Company, as disclosed in the Appendix II to this circular, and the number of shares in the Company in respect of which it would control or would be entitled to exercise control over the voting right at the SGM.

As far as the Directors are aware, other than President, no other Shareholder has a material interest in the above transaction and has to abstain from voting at the SGM on the relevant resolution.

The Independent Board Committee has been appointed to advise the Independent Shareholders on the terms of the Product Purchase Framework Agreement as amend by the Supplemental Agreement and the proposed revised annual caps for the three years ending 31 December 2014.

Messis Capital Limited was appointed by the Company as the Independent Financial Adviser to make recommendations to the Independent Board Committee and Independent Shareholders on the terms of the Product Purchase Framework Agreement as amend by the Supplemental Agreement and the revised annual caps.

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LETTER FROM THE BOARD

3. PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

In compliance with the requirements of the Company Law of the PRC, the Board proposes to make certain amendments to the Articles of Association, the proposed amendments by way of special resolution will be submitted to the SGM for Shareholders’ approval. The details of the proposed amendments to the Articles of Association are set out in Appendix I to this circular.

4. SGM

The form of proxy and reply slip for use at the SGM are enclosed.

If you wish to attend such meeting by proxy, you are required to complete the enclosed form of proxy in accordance with the instructions printed thereon and return them as soon as possible. For H Shareholders, the proxy form shall be delivered to the Company’s H Share registrar, Tricor Tengis Limited at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong; and for Domestic Shareholders, the proxy form shall be delivered to the registered office of the Company at No. 18 Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC, however, in any event not later than 24 hours before the time appointed for the holding of the SGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjournment thereof if you so wish.

If you intend to attend the SGM in person or by proxy, you are required to complete and return the reply slip to the principal place of business of the Company in Hong Kong (for H Shareholders) or to the registered office of the Company (for Domestic Shareholders) on or before Monday, 5 November 2012.

5. VOTING BY WAY OF POLL

In accordance with the provisions of the Listing Rules, any vote of shareholders at a general meeting must be taken by poll. As such, the resolutions set out in the notice convening the SGM will be voted by poll. Results of the poll voting will be published on the Company’s website at www.andre.com.cn and the website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk after the general meeting.

6. RECOMMENDATIONS

The Directors (including independent non-executive Directors) consider that the resolutions set out in the notice of the SGM are all in the best interests of the Company and the Shareholders as a whole. Accordingly, the Board recommends to vote in favour of all the proposed resolutions.

The Directors also draw your attention to the letter from the Independent Board Committee and a letter from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders which are set out on pages 11 to 19 of this circular. The Independent Board Committee, having taken into account the advice of the

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LETTER FROM THE BOARD

Independent Financial Adviser, considers that the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement are on normal commercial terms, and are fair and reasonable and the entering into the Supplemental Agreement is in the interests of the Company and the Independent Shareholders as a whole. The Independent Board Committee further considers that the proposed revised annual caps for the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement for the three years ending 31 December 2014 are fair and reasonable so far as the Company and the Independent Shareholders are concerned. Accordingly, the Independent Board Committee recommends the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the SGM.

7. ADDITIONAL INFORMATION

Your attention is also drawn to the other information set out in the Appendices of this circular.

By order of the Board Yantai North Andre Juice Co., Ltd.* Wang An Chairman

* For identification purpose only

– 10 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 02218)

10 October 2012

To the Independent Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTION

PROPOSED REVISION OF THE ANNUAL CAPS FOR THE THREE YEARS ENDING 31 DECEMBER 2014 FOR THE TRANSACTIONS UNDER THE PRODUCT PURCHASE FRAMEWORK AGREEMENT

We refer to the circular of the Company (the “Circular”) dated 10 October 2012 despatched to the Shareholders of which this letter forms a part. Unless the context requires otherwise, terms and expressions defined in the Circular shall have the same meanings in this letter.

We have been appointed to advise the Independent Shareholders on whether the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Messis Capital Limited has been appointed to advise the Independent Board Committee and Independent Shareholders in respect of the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement and the proposed revised annual caps for the three years ending 31 December 2014.

We wish to draw your attention to the letter from the Board set out on pages 4 to 10 of the Circular and the letter from the Independent Financial Adviser set out on pages 13 to 19 of the Circular.

* For identification purpose only

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having considered the advice given by Messis Capital Limited, we are of the opinion that the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are on normal commercial terms and are fair and reasonable and the entering into of the Supplemental Agreement with President is in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of such ordinary resolution to be proposed at the SGM.

Yours faithfully,

For and on behalf of the Independent Board Committee Yantai North Andre Juice Co., Ltd.*

Yu Shou Neng Qu Wen Independent Non-executive Director Independent Non-executive Director Gong Fan Chow Kam Hung Independent Non-executive Director Independent Non-executive Director

* For identification purpose only

– 12 –

LETTER FROM MESSIS CAPITAL

The following is the text of a letter from Messis in connection with the advice to the Independent Board Committee and the Independent Shareholders on the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps), which has been prepared for the purpose of inclusion in this circular:

10 October 2012

To the Independent Board Committee and the Independent Shareholders of the Company

Dear Sirs,

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

INTRODUCTION

We refer to our engagement as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the whether the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are on normal commercial terms and are fair and reasonable and the entering into of the Supplemental Agreement with President is in the interests of the Company and the Shareholders as a whole, details of which are set out in the letter from the Board (the “Board Letter”) contained in the circular of the Company dated 10 October 2012 (the “Circular”) of which this letter forms part. Terms defined in the Circular shall have the same meanings in this letter unless the context of this letter otherwise requires.

On 30 March 2012, the Company entered into the Product Purchase Framework Agreement with President, whereby President agrees to purchase and the Company agrees to supply the Company’s products (including but not limited to different kinds of juice), to regulate such product purchase between the Group and President for the three financial years ending 31 December 2014. Based on internal estimation, the Directors are of the view that the existing 2012, 2013 and 2014 annual caps for the transactions under the Product Purchase Framework Agreement will not be sufficient for the Group’s current requirements. Therefore, the Company entered into the Supplemental Agreement with President on 17 September 2012 to revise the 2012, 2013 and 2014 annual caps to RMB 100,000,000, RMB 200,000,000 and RMB 270,000,000, respectively.

As at the Latest Practicable Date, President holds 637,460,401 domestic shares of the Company, representing 15.59% of the total issued share capital of the Company. Under the Listing Rules, where independent shareholders’ approval is required with regard to a connected transaction. Accordingly, President and associate(s) (as defined under the Listing

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LETTER FROM MESSIS CAPITAL

Rules) shall at the SGM abstain from voting on the transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement and the proposed revised annual caps for the three years ending 31 December 2014.

An Independent Board Committee of the Company has been formed to advise the Independent Shareholders on whether the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are on normal commercial terms and are fair and reasonable and the entering into of the Supplemental Agreement with President is in the interests of the Company and the Shareholders as a whole.

In formulating our opinion, we have relied on the accuracy of statements, information, opinions and representations contained in the Circular and the information and representations provided to us by the Company and which the Directors consider to be complete and relevant, and have assumed that the statements made were true, accurate and complete at the time they were made and continue to be true on the date of the Circular. We have assumed that all information, representations and opinions contained or referred to in the Circular and all information, representations and opinions which have been provided by the Company are true at the time they were made and will continue to be true at the date of the despatch of the Circular.

We consider that we have received sufficient information to enable us to reach an informed view and to justify our reliance on the accuracy of the information and representations contained in the Circular and to provide a reasonable basis for our view and recommendation. We have no reason to suspect that any material information has been withheld by the Company or by the Directors. We have not, however, carried out any independent investigation into the business and affairs of the Company. Pursuant to the Listing Rules, we have taken reasonable steps to satisfy ourselves which include the following:

(a) obtained all the information and documents relevant to an assessment of the fairness and reasonableness of the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps), the Supplemental Agreement, including but not limited to, the Board Letter, the Product Purchase Framework Agreement, the announcement of the Company dated 30 March 2012, the Company’s projection of the sales of the products under the Supplemental Agreement, the first half of 2012 market research report of ACNielsen, the interim report for six months ended 30 June 2012 of Uni-President China Holdings Limited, the interim report for six months ended 30 June 2012 of the Company and the annual report of the Company for the year ended 31 December 2011;
(b) reviewed the reasons and background as well as the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps);
(c) reviewed the fairness and reasonableness of the assumptions and projections relevant to the annual caps; and

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LETTER FROM MESSIS CAPITAL

(d) confirmed that no third party expert opinion being relevant to the revised annual caps.

PRINCIPAL FACTORS TAKEN INTO ACCOUNT

In arriving at our opinions and recommendations to the Independent Board Committee and the Independent Shareholders in respect of whether the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are on normal commercial terms and are fair and reasonable and the entering into of the Supplemental Agreement with President is in the interests of the Company and the Shareholders as a whole, we have considered the principal factors and reasons set out below:

I. Background of and reasons for entering into the Product Purchase Framework Agreement

(i) the historical figure for the eight months ended 31 August 2012 was approximately RMB 47,300,000 and it is estimated that the sales volume of the pear juice concentrate will increase significantly in 2012. The main reason for such increase is that President has developed a new product, the crystal sugar pear drink, which the Company’s pear juice concentrate is the major ingredient of such new product. For the first three quarters of 2012, President has received an

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LETTER FROM MESSIS CAPITAL

approximately 200% increase in its orders on crystal sugar pear drink than that of the entire 2011, and President expects that the orders will continue to increase significantly starting from the forthcoming winter due to the peak season for the Chinese new year period, which results in a substantial increase in the sales volume of the Company’s pear juice concentrate;

(ii) President’s crystal sugar pear drink was launched to the market in March 2011. The sales of such product are very promising and the market share has increased from approximately 0.1% since then to approximately 4.3% as at the end of August 2012. Consequently, it is estimated that the sales volume of the Company’s pear juice concentrate with President will increase significantly in the three financial years ending 31 December 2014;
(iii) the Directors have discussed with President relating to the sales of its crystal sugar pear drink and its demand for the Company’s pear juice concentrate between 2012 and 2014. With reference to the proposed orders from President, the demand in terms of sales volume on the Company’s pear juice concentrate will increase by approximately 38% as compared with the amount originally contemplated in the existing annual caps for the year 2012. With reference to the internal forecast of President, the demand will further increase by approximately 100% and 33% in the years 2013 and 2014 respectively; and
(iv) the sales price based on the prevailing market prices of the Company’s products has also increased in 2012 due to the increase in the costs for the production of the Company’s products, such as the raw materials and labor costs, and there may be further increase by approximately 3% for each of the years 2013 and 2014.

We have researched on the market performance of the juice market in China. According to the latest market research of the first half of 2012 report of ACNielsen, the growth rate of the President Group’s juice drinks business for the first half of 2012 exceeded the general growth in the juice drinks market. Crystal Sugar Pear Drink of the President Group grew rapidly and led the performance of the whole juice drinks business with an increase in market share in terms of sales from 11.0% in the first half of 2011 to 11.9% in the first half of 2012, representing a growth of 0.9 percentage point.

We have also reviewed the interim report for six months ended 30 June 2012 of Uni-President China Holdings Limited and its subsidiaries. According the interim report for six months ended 30 June 2012 of Uni-President China Holdings Limited, Crystal Sugar Pear Drink, the first of its kind in the market, has become widely popular with its unique flavour and nourishing values. In 2012, flocks of juice manufacturers put crystal sugar pear products into the market, proving the Crystal Sugar Pear Drink is the new favourite beverage of the year.

– 16 –

LETTER FROM MESSIS CAPITAL

We have reviewed the confirmed orders from President and note that the existing annual cap for 2012 for the transactions under the Product Purchase Framework Agreement of RMB60,000,000 is barely enough for the confirmed orders which means there is no annual cap for additional orders to be confirmed for 2012 delivery. We have also reviewed indicative orders received from President and note that the existing annual cap for 2013 for the transactions under the Product Purchase Framework Agreement of RMB72,000,000 is also barely enough for the indicative orders received from President which means further orders cannot be delivered in 2013 under the existing annual caps. With reference to the proposed orders from President, the demand in terms of sales volume on the Company’s pear juice concentrate will increase by approximately 38% as compared with the amount originally contemplated in the existing annual caps for the year 2012. With reference to the internal forecast of President, the demand will further increase by approximately 100% in the years 2013.

We have reviewed the Company’s projection and the calculation of the sales of the products under the the Supplemental Agreement and note that the underlying assumptions in deriving the revised annual caps for the each of the three years ending 31 December 2014, including (i) the adjustment on unit price in 2013 and 2014 with reference to the historically averaged inflation rate in the PRC; (ii) the tax issue for sales of the products (including pear juice concentrate) to President; and (iii) the currency exchange issue between RMB and the US Dollars which affects the procurement decision of President due to the significant USD-dominated borrowings of the President Group; we are of the view that the assumptions of in deriving the revised annual caps for the each of the three years ending 31 December 2014 are reasonable and complete.

Having reviewed (i) the confirmed orders received from President; (ii) the Company’s projection and the calculation of the sales of the products under the the Supplemental Agreement; (iii) the underlying assumptions in deriving the revised annual caps for the each of the three years ending 31 December 2014; (iv) the latest market research of ACNielsen on the juice market; (v) the interim report of President in relation to Crystal Sugar Pear Drink; and (vi) the sufficiency of the annual caps between 2012 and 2014, we consider that the revised annual caps under the Product Purchase Framework Agreement as amended by the Supplemental Agreement of RMB100,000,000, RMB200,000,000 and RMB270,000,000, respectively for the three years ending 31 December 2014 are fair and reasonable.

Reasons for the continuing connected transactions

– 17 –

LETTER FROM MESSIS CAPITAL

proportion of domestic sales of the Company’s pear juice products as well as product diversification, which will in turn increase the revenue and profits of the Company. For the same reasons, the Company is of the view that it is in the best interest of the Company and the Shareholders as a whole to give first priority to the purchase by President in the event that the purchase terms are the same as those of third parties.

Basis of Pricing

Under the Produce Purchase Framework Agreement, the prices of products to be supplied by the Company shall be determined according to the following principles in orders:

the price prescribed by the PRC government (if any);
where there is no government-prescribed price, the guidance price set by the PRC government (if any);
where there is neither government-prescribed price nor government guidance price, the market price (including tender price); and
where any of the above prices is unavailable or inapplicable, the agreed price.

The market price means either the prevailing price being charged by independent third parties under ordinary course of business for the sales of the same type of products at the selling places or its nearby regions; or the prevailing price being charged by independent third parties under ordinary course of business for the sales of the same type of products in the PRC. The agreed price means the price determined on the basis of reasonable cost with reasonable profit. We are of the view that it is fair and reasonable, so far as the Independent Shareholders are concerned, the prices of products to be supplied by the Company under the Product Purchase Framework Agreement to be determined is according to the price prescribed by the PRC government, the guidance price set by the PRC government, the market price (including tender price) or the agreed price.

We have also reviewed other terms of the Product Purchase Framework Agreement other than the basis of pricing as stated above and the proposed revised annual caps as amended by the Supplemental Agreement, no extra-ordinary terms or less favourable terms to the Company being noted, we are of the view that the entering into the Product Purchase Framework Agreement on 30 March 2012 and the proposed entering into the Supplemental Agreement are on normal commercial terms.

Having considered each of the revised annual caps above have been determined by reference to (i) the sufficiency of the annual caps between 2012 and 2014; and (ii) the prices of products to be supplied by the Company according to the price prescribed by the PRC government, the guidance price set by the PRC government, the market price (including tender price) or the agreed price, we consider that the revised annual caps under the Product Purchase Framework Agreement as amended by the Supplemental Agreement are in the interest of the Independent Shareholders and the Company as a whole and fair and reasonable.

– 18 –

LETTER FROM MESSIS CAPITAL

III. RECOMMENDATION

Having considered the factors and reasons as stated above, we are of the view that the terms of the Product Purchase Framework Agreement as amended by the Supplemental Agreement (including the revised annual caps) are on normal commercial terms and are fair and reasonable and the entering into of the Supplemental Agreement with President is in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders and advise the Independent Board Committee to recommend the Independent Shareholders to vote in favour of such ordinary resolution to be proposed at the SGM.

Yours faithfully, For and on behalf of Messis Capital Limited Michael Leung Executive Director

– 19 –

APPENDIX I PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

Particulars of the proposed amendments to the Articles of Association are set out as follows:

Before amendment

After amendment

Articles Particulars

Article 15 Upon the approval of China Article 15 Securities Regulatory Commission, the Company issues totally 1,760,176,000 shares of H shares, accounting for 41.27% of the total amount of the issued ordinary shares of the Company.

Subject to the approval by the company examination and approval authority authorized by the State Council, the Company may issue a total number of 113,880,000 ordinary shares. The Company issued 113,880,000 shares to the promoters, accounting for 100% of the total ordinary shares of the Company to be issued, upon the establishment. On 26 June 2001, the Company was converted from a sino-foreign joint limited liability company into a sino-foreign joint stock limited company by way of net asset reduction. The subscription by the promoters are as follows:

Promoter Glory Cause Land Afforestation Co., Ltd. Korea Jeong Soo Andre Co., Ltd. Yantai Donghua Fruit Co., Ltd. Beijing RAJ Network Sales Co. Ltd. YUNG, Ka Hee Titus Kunyunshan Fruit Co., Ltd. Total	Number of Shares (Shares) 54,662,400 28,470,000 19,929,000 5,694,000 3,416,400 1,708,200 113,880,000	Percentage to the share capital (%) 48.00 25.00 17.50 5.00 3.00 1.50
		100.00

– 20 –

GENERAL INFORMATION

APPENDIX II

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.

DISCLOSURE OF INTERESTS

Directors’, Supervisors’ and Chief Executive’s Interests and Short Positions in the Shares, Underlying Shares and Debentures of the Company

As at the Latest Practicable Date, the interests and short positions of the Directors, supervisors and chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance (“SFO”)) which were (a) 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 are taken or deemed to have under such provisions of the SFO); and (b) required to be recorded in the register kept by the Company pursuant to section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to the required standard of dealings by the directors of the Company as referred to in Appendix 10 of the Listing Rules were as follows:

					Approximate
					percentage of	Approximate
					Domestic	percentage of
Name of		Number of		Type of	Shares/H	total share
Directors	Class of shares	shares held	Capacity	interest	Shares	capital
Wang An	Domestic Shares	1,188,105,006 (L)	Interest of controlled	Personal	47.42% (L)	29.05% (L)
(Note 1)			corporations (Note 2)
	H Shares	17,085,000 (L)	Interest of controlled	Personal	1.08% (L)	0.42% (L)
			corporations (Note 3)
Liu Tsung-Yi	H Shares	1,954,000 (L)	Beneficial owner	Personal	0.12% (L)	0.048% (L)

Notes: The letter “L” denotes a long position.

1) As at the Latest Practicable Date, Mr. Wang An, a Director, controlled (a) 90% interest in China Pingan Investment Holdings Limited, which held 441,519,606 Domestic Shares and 17,085,000 H Shares, representing 10.80% and 0.42% interests in the total issued share capital of the Company, respectively; and (b) 90% interest in Shandong Andre Group Co., Ltd.* （山東安德利集團有限公司）, which held 746,585,400 Domestic Shares, representing 18.25% interest in the total issued share capital of the Company.
2) Mr. Wang An was deemed to be interested in these Domestic Shares through his interests in China Pingan Investment Holdings Limited and Shandong Andre Group Co., Ltd.*（山東安德利集團有限公司）.

* For identification purpose only

– 21 –

GENERAL INFORMATION

APPENDIX II

3) The long position in 17,085,000 H Shares was held by China Pingan Investment Holdings Limited. Mr. Wang An was deemed to be interested in these H Shares through his 90% interest in China Pingan Investment Holdings Limited.

At the Latest Practicable Date, none of the Directors, supervisors or chief executive had any interests or short positions 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 are (a) 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 are taken or deemed to have under such provisions of the SFO); and (b) required to be recorded in the register kept by the Company pursuant to Section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to Appendix 10 of the Listing Rules.

Substantial Shareholders’ Interests and Short Positions in the Shares, Underlying Shares and Debentures of the Company

As at the Latest Practicable Date, so far as the Directors are aware, the following persons (other than the Directors, supervisors and chief executive of the Company) had interests and short positions in the shares, underlying shares and debentures of the Company which were discloseable under Divisions 2 and 3 of Part XV of the SFO and recorded in the register kept by the Company pursuant to section 336 of the SFO:

					Approximate
					percentage of	Approximate
					Domestic	percentage of
		Number of		Type of	Shares/H	total share
Name of Shareholders	Class of shares	shares held	Capacity	interest	Shares	capital
China Pingan	Domestic Shares	441,519,606 (L)	Beneficial owner	Corporate	17.62% (L)	10.80% (L)
Investment Holdings		(Note 1)
Limited
	H Shares	17,085,000 (L)	Beneficial owner	Corporate	1.08% (L)	0.42% (L)
Shandong Andre Group	Domestic Shares	746,585,400 (L)	Beneficial owner	Corporate	29.80% (L)	18.25% (L)
Co., Ltd.*（山東安德利		(Note 2)
集團有限公司）
Donghua Fruit Industry	Domestic Shares	657,794,593 (L)	Beneficial owner	Corporate	26.26% (L)	16.08% (L)
Co., Ltd.		(Note 3)
Uni-President	Domestic Shares	637,460,401 (L)	Interests of	Corporate	25.44% (L)	15.59% (L)
Enterprises Corp.		(Note 4)	controlled
			corporations
			(Note 5)
Atlantis Capital	H Shares	320,000,000 (L)	Interests of	Corporate	20.20% (L)	7.82% (L)
Holdings Limited		(Note 6)	controlled
			corporations
Norges Bank	H Shares	123,360,000 (L)	Beneficial owner	Corporate	7.79% (L)	3.02% (L)
Mitsui & Co., Ltd.	H Shares	213,400,000 (L)	Beneficial owner	Corporate	13.47 % (L)	5.22% (L)
		(Note 7)
JP Morgan Chase & Co.	H Shares	123,360,000 (L)	Custodian	Corporate	7.79% (L)	3.02% (L)
			corporation/
		123,360,000 (P)	approved lending		7.79% (P)	3.02% (P)
		(Note 8)	agent

– 22 –

GENERAL INFORMATION

APPENDIX II

					Approximate
					percentage of	Approximate
					Domestic	percentage of
		Number of		Type of	Shares/H	total share
Name of Shareholders	Class of shares	shares held	Capacity	interest	Shares	capital
HSBC Global Asset	H Shares	100,000,000 (L)	Investment manager	Corporate	6.31% (L)	2.45% (L)
Management (Hong
Kong) Limited
(Formerly known as
HSBC Investments
(Hong Kong)
Limited)

Notes: The letter “L” denotes a long position. The letter “P” denotes interests in a lending pool.

1) Mr. Wang An, a Director of the Company, was deemed to be interested in these Domestic Shares through his 90% interest in China Pingan Investment Holdings Limited.
2) Mr. Wang An, a Director, was deemed to be interested in these Domestic Shares through his 90% interest in Shandong Andre Group Co., Ltd.*（山東安德利集團有限公司）.
3) The long position in 657,794,593 Domestic Shares was directly held by Donghua Fruit Industry Co., Ltd.. Based on the information provided by Donghua Fruit Industry Co., Ltd., Mr. Zhang Jiaming is deemed to be interested in these 657,794,593 Domestic Shares.
4) The long position in 637,460,401 Domestic Shares was held by Uni-President China Holdings Ltd., a non wholly-owned subsidiary of Uni-President Enterprises Corp.（統一企業股份有限公司）, through its two wholly-owned subsidiaries, namely, Chengdu President Enterprises Food Co., Ltd.（成都統一企業食品有限公司）, which held 424,183,601 Domestic Shares, and Guangzhou President Enterprises Co., Ltd.（廣州統一企業有限公司）, which held 213,276,800 Domestic Shares.
5) Pursuant to Part XV of the SFO, Uni-President Enterprises Corp.（統一企業股份有限公司）was deemed to be interested in such 637,460,401 Domestic Shares. The 637,460,401 Domestic Shares were held by a series of controlled corporations of Uni-President Enterprises Corp.（統一企業股份有限公司）, of which 424,183,601 Domestic Shares, representing approximately 10.37% of the total issued share capital of the Company, were held directly by Chengdu President Enterprises Food Co., Ltd.（成都統一企業食品有限公司）and 213,276,800 Domestic Shares, representing approximately 5.21% of the total issued share capital of the Company, were held directly by Guangzhou President Enterprises Co., Ltd.
（廣州統一企業有限公司）.
6) According to the public information available on the website of the Stock Exchange, Atlantis Capital Holdings Limited was a 100% controlled corporation of Liu Yang; Liu Yang was deemed to be interested in such 320,000,000 H Shares.
7) After the capitalization issue of shares by the Company in 2007, the number of H Shares held by Mitsui & Co., Ltd. was adjusted from 97,000,000 H shares to 213,400,000 H shares.
8) According to the public information available on the website of the Stock Exchange, these H Shares were held directly by JP Morgan Chase Bank N.A., a wholly-owned subsidiary of JP Morgan Chase & Co.

Save as disclosed above, as at the Latest Practicable Date, the Directors were not aware of any other person who had an interest or short position in the shares or underlying shares which would fall to be disclosed to the Company under the provisions of Divisions 2

* For identification purpose only

– 23 –

GENERAL INFORMATION

APPENDIX II

and 3 of Part XV of the SFO, or, who is expected, directly or indirectly, to be interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meeting of any other member of the Group.

Mr. Wang An, an executive Director, is a director of China Pingan Investment Holdings Limited and Shandong Andre Group Co., Ltd.*, respectively.

Mr. Lin Wu-Chung, a non-executive Director, is the vice president of the general manager office of Uni-President Enterprises Corp., which is listed on the Taiwan Stock Exchange.

Mr. Liu Tsung-Yi, a non-executive Director, is the vice president of the business integration division of Uni-President Enterprises Corp. and also the president/director/ supervisor of 14 member companies of Uni-President Enterprises Corp., amongst which Tait Marketing and Distribution Co., Ltd. is a company listed on the Taiwan Gretai Securities Market.

Save as disclosed above, as at the Latest Practicable Date, the Directors were not aware of any Director who is also a director or employee of a company which has an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Division 2 and 3 of Part XV of the SFO.

MATERIAL LITIGATION

As at the Latest Practicable Date, the Directors were not aware of any litigation or claim of material importance pending or threatened against any member of the Group.

COMPETING INTEREST

As at the Latest Practicable Date, so far as the Directors were aware, none of the Directors, the management shareholders of the Company, substantial shareholders of the Company and their respective associates had any interest in a business which competed or might compete with the businesses of the Group or had or might have any other conflicts of interest with the Group.

SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors or supervisors of the Company had any existing or proposed service contract with any member of the Group (excluding contracts expiring or terminable by the employer within a year without payment of any compensation (other than statutory compensation)).

MISCELLANEOUS

(a) The registered office of the Company is at No. 18, Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC.

– 24 –

GENERAL INFORMATION

APPENDIX II

(b) The Company’s principal place of business in Hong Kong is at Unit 2805, 28/F, The Center, 99 Queen’s Road C, Hong Kong.
(c) The qualified accountant and the company secretary of the Company is Miss Ng Man Yee, who is a fellow member of the Association of Chartered Certified Accountants, Chartered Accountant of the Institute of Chartered Accountants in England and Wales and Certified Public Accountant of the Hong Kong Institute of Certified Public Accountants.
(d) The compliance officer of the Company is Mr. Zhang Hui who is also an executive Director.
(e) The English text of this circular and the proxy form shall prevail over their respective Chinese text in the case of inconsistency.

MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2011, the date to which the latest published audited consolidated financial statements of the Group were made up.

DIRECTORS’ INTERESTS IN ASSETS AND/OR CONTRACTS AND OTHER INTERESTS

As at the Latest Practicable Date, none of the Directors had any direct or indirect interests in any assets which had been acquired or disposed of by, or leased to, or which were proposed to be acquired or disposed of by, or leased to, the Company or any of its subsidiaries since 31 December 2011, the date of which the latest published accounts of the Group were made up.

No contract or arrangement in which a Director was materially interested and which was significant in relation to the business of the Group subsisted as at the Latest Practicable Date.

CONSENT AND QUALIFICATION OF EXPERT

The following is the qualification of the professional adviser who has given the Company opinions and provided advices referred to and contained in this circular:

Name Qualifications Messis Capital Limited A licensed corporation under the SFO to engage in Type 6 regulated activities under the SFO

– 25 –

GENERAL INFORMATION

APPENDIX II

As at the Latest Practicable Date, the above expert was not beneficially interested in the share capital of any member of the Group and did not have any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, the above expert did not have any direct or indirect interest in any asset which had been, since 31 December 2011, being the date to which the latest audited financial statements of the Group were made up, acquired, or disposed of by, or leased to, or were proposed to be acquired, or disposed of by, or leased to, any member of the Group.

The above expert has given on 10 October 2012 and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter, report and references to its names included in this circular in the form and context in which it is included.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the principal place of business of the Company in Hong Kong at Unit 2805, 28/F, The Center, 99 Queen’s Road C, Hong Kong during normal business hours from up to the date which is 14 days from the date of this circular:

(a) the Product Purchase Framework Agreement;
(b) the Supplemental Agreement;
(c) the letter of recommendation dated 10 October 2012 from the Independent Board Committee to the Independent Shareholders, the text of which is set out on pages 11 to 12 of this circular;
(d) the letter of advice dated 10 October 2012 from Messis Capital Limited to the Independent Board Committee and the Independent Shareholders, the text of which is set out on pages 13 to 19 of this circular; and
(e) the written consent of Messis Capital Limited referred to in this Appendix.

– 26 –

NOTICE OF SPECIAL GENERAL MEETING

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 02218)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the special general meeting (the “ SGM ”) of Yantai North Andre Juice Co., Ltd.（烟台北方安德利果汁股份有限公司）(the “ Company ”) will be held at 2nd Floor, No. 18 Andre Avenue, Muping Economic Development Zone, Yantai City, Shandong Province, the PRC at 10:00 a.m. on Monday, 26 November 2012 to consider and, if though fit, pass the following resolutions (unless otherwise defined herein, the terms herein shall have the same meanings as defined in the circular to the shareholders of the Company dated 10 October 2012 (the “ Circular* ”)):

ORDINARY RESOLUTION

To consider and approve the continuing connected transactions under the Product Purchase Framework Agreement as amended by the Supplemental Agreement and proposed revised annual caps for each of the three years ending 2014, details of which are set out in the Circular.

SPECIAL RESOLUTION

To consider and approve the resolution in relation to the amendments to the Articles of Association, details of which are set out in the Circular.

By Order of the Board Yantai North Andre Juice Co., Ltd.* Wang An Chairman

Yantai, the PRC

10 October 2012

As at the date of this notice, the executive Directors of the Company are Messrs. Wang An, Zhang Hui and Wang Yan Hui, the non-executive Directors are Messrs. Lin Wu-Chung and Liu Tsung-Yi, and the independent non-executive Directors are Ms. Yu Shou Neng, Ms. Qu Wen, Mr. Gong Fan and Mr. Chow Kam Hung.

* For identification purpose only

– 27 –

NOTICE OF SPECIAL GENERAL MEETING

Notes:

For the purpose of determining who may attend the SGM to be held on Monday, 26 November 2012, the register of H Shareholders will be closed from Saturday, 27 October 2012 to Monday, 26 November 2012 (both dates inclusive), during which no transfer of H Shares will be registered. In order to qualify for entitlement to attending and voting in the SGM, all transfers of H Shares accompanied by the relevant share certificates and transfer forms must be lodged with the Company’s H Share registrar, Tricor Tengis Limited for registration not later than 4:30 p.m. on Friday, 26 October 2012.

The address of Tricor Tengis Limited is as follows:

26th Floor Tesbury Centre 28 Queen’s Road East, Wanchai Hong Kong Fax: (852) 2810 8185

In accordance with the Listing Rules, any vote of Shareholders at a general meeting must be taken by poll. As such, the resolutions set out in the notice of SGM will be voted by poll. Results of the poll voting will be published on the Company’s website at www.andre.com.cn and the website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk after the SGM.
Any Shareholder entitled to attend and vote at the SGM convened by the above notice is entitled to appoint one or more proxies to attend and vote instead of him/her. A proxy need not be a Shareholder.
In order to be valid, the instrument appointing a proxy together with the power of attorney or other authority, if any, under which it is signed, or a notarially certified copy of such power of attorney or authority, must be completed and deposited at the Company’s H Share registrar, Tricor Tengis Limited (for H Shareholders) or the registered office of the Company (for Domestic Shareholders), at least 24 hours before the SGM or any adjourned meeting thereof. The Company’s registered office is located at No. 18 Andre Avenue, Muping Economic Development Zone Yantai City, Shandong Province, the PRC (Fax no. (86-535) 421-8858). The Company’s H Share registrar, Tricor Tengis Limited, is located at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong (Fax no. (852) 2810 8185).
Completion and return of a proxy form will not preclude you from attending and voting at the SGM or any adjourned meeting thereof if you so wish.
In case of joint shareholdings, the vote of the senior joint shareholder who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the votes of the other joint shareholder(s) and for this purpose seniority will be determined by the order in which the names stand in the register of members of the Company in respect of the joint shareholding.
Shareholders who intend to attend the SGM in person or by proxy should return the reply slip for the SGM to the registered office of the Company (for Domestic Shareholders) or the principal place of business of the Company in Hong Kong (for H Shareholders), by hand, by post or by fax on or before Monday, 5 November 2012. The Company’s registered office is located at No. 18 Andre Avenue, Muping Economic Development Zone Yantai City, Shandong Province, the PRC (Fax no. (86-535) 421-8858). The principal place of business of the Company in Hong Kong, is located at Unit 2805, 28/F, The Center, 99 Queen’s Road C, Hong Kong (Fax no. (852) 2587 9166).
The SGM is expected to last for about half a day. Shareholders who attend the meeting in person or by proxy shall bear their own travelling and accommodation expenses. Shareholders or their proxies shall produce their identity documents when attending the SGM.

– 28 –

AI assistant

Yantai North Andre Juice Co. Ltd. — Proxy Solicitation & Information Statement 2012

50453_rns_2012-10-10_59ff5ec5-251e-4001-80a2-ee0b72b8c27b.pdf

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT; PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

NOTICE OF SPECIAL GENERAL MEETING

INDEPENDENT FINANCIAL ADVISER TO THE INDEPENDENT BOARD COMMITTEE AND THE INDEPENDENT SHAREHOLDERS IN RELATION TO THE PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

CONTENTS

DEFINITIONS

DEFINITIONS

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT; PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND NOTICE OF SPECIAL GENERAL MEETING

1. INTRODUCTION

2. PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

2.1 BACKGROUND

2.2 REASONS FOR THE CONTINUING CONNECTED TRANSACTIONS

LETTER FROM THE BOARD

2.3 LISTING RULES IMPLICATIONS

2.4 GENERAL INFORMATION

LETTER FROM THE BOARD

3. PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

4. SGM

5. VOTING BY WAY OF POLL

6. RECOMMENDATIONS

LETTER FROM THE BOARD

7. ADDITIONAL INFORMATION

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

CONTINUING CONNECTED TRANSACTION

PROPOSED REVISION OF THE ANNUAL CAPS FOR THE THREE YEARS ENDING 31 DECEMBER 2014 FOR THE TRANSACTIONS UNDER THE PRODUCT PURCHASE FRAMEWORK AGREEMENT

Yours faithfully,

PROPOSED REVISION OF THE EXISTING ANNUAL CAPS FOR PRODUCT PURCHASE FRAMEWORK AGREEMENT

INTRODUCTION

PRINCIPAL FACTORS TAKEN INTO ACCOUNT

I. Background of and reasons for entering into the Product Purchase Framework Agreement

LETTER FROM MESSIS CAPITAL

Reasons for the continuing connected transactions

LETTER FROM MESSIS CAPITAL

Basis of Pricing

LETTER FROM MESSIS CAPITAL

III. RECOMMENDATION

Before amendment

After amendment

Articles Particulars

Articles Particulars

RESPONSIBILITY STATEMENT

DISCLOSURE OF INTERESTS

Directors’, Supervisors’ and Chief Executive’s Interests and Short Positions in the Shares, Underlying Shares and Debentures of the Company

Substantial Shareholders’ Interests and Short Positions in the Shares, Underlying Shares and Debentures of the Company

MATERIAL LITIGATION

COMPETING INTEREST

SERVICE CONTRACTS

MISCELLANEOUS

MATERIAL ADVERSE CHANGE

DIRECTORS’ INTERESTS IN ASSETS AND/OR CONTRACTS AND OTHER INTERESTS

CONSENT AND QUALIFICATION OF EXPERT

APPENDIX II

DOCUMENTS AVAILABLE FOR INSPECTION

烟台北方安德利果汁股份有限公司 Yantai North Andre Juice Co., Ltd.[*]

NOTICE OF SPECIAL GENERAL MEETING

ORDINARY RESOLUTION

SPECIAL RESOLUTION

NOTICE OF SPECIAL GENERAL MEETING

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Yantai North Andre Juice Co. Ltd. Proxy Solicitation & Information Statement 2012