Youzan Technology Limited — AGM Information 2016

Mar 31, 2016

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 China Innovationpay Group Limited (the “Company”), you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) 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.

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM 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.

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China Innovationpay Group Limited 中國創新支付集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 8083)

PROPOSED GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, REFRESHMENT OF SCHEME MANDATE LIMIT OF SHARE OPTION SCHEME, PROPOSED RE-ELECTION OF DIRECTORS, RE-APPOINTMENT OF AUDITOR AND

NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of the Company (the “AGM”) to be held at Yue Function Room, First Floor, City Garden Hotel, 9 City Garden Road, North Point, Hong Kong at 10:00 a.m. on Wednesday, 11 May 2016, is set out on pages 19 to 23 of this circular. A form of proxy for use by the shareholders of the Company at the AGM (or any adjournment thereof) is also enclosed. Whether or not you are able to attend the AGM, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the Secretary of the Company at the Company’s principal place of business and head office in Hong Kong at Unit 2708, 27/F., The Center, 99 Queen’s Road Central, Hong Kong as soon as possible, but in any event not less than 48 hours before the time appointed for the holding of the AGM (or any adjournment thereof). Completion and return of the form of proxy will not preclude you from attending and voting at the AGM (or any adjournment thereof) in person if you so wish. This circular will remain on the “Latest Company Announcements” page of the GEM website at www.hkgem.com for at least 7 days from the date of its publication and on the Company’s website at www.innovationpay.com.hk.

31 March 2016

CHARACTERISTICS OF THE GEM

GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM.

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TABLE OF CONTENTS

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from	the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
2.	Proposed Granting of the General Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
3.	General Mandate for Repurchase of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
4.	Proposed Refreshment of Scheme Mandate Limit of
	Share Option Scheme Adopted on 3 May 2012 . . . . . . . . . . . . . . . . . . . . . . .	6
5.	Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
6.	Re-appointment of Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
7.	Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
8.	Actions to be Taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
9.	Voting by Poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
10.	Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
11.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
Appendix I	– Explanatory Statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Appendix II	– Biographical Details of Directors Proposed to be Re-elected. . . . . . . .	16
Notice of AGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		19

Accompanying: Form of proxy for AGM

– ii –

DEFINITIONS

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

“AGM”

the annual general meeting of the Company to be held at Yue Function Room, First Floor, City Garden Hotel, 9 City Garden Road, North Point, Hong Kong at 10:00 a.m. on Wednesday, 11 May 2016, notice of which is setout on pages 19 to 23 of this circular

“Board”

the board of Directors

“Bye-Laws” the bye-laws of the Company as may be amended from time to time “close associate(s)” has the meaning ascribed thereto in the GEM Listing Rules “Company” China Innovationpay Group Limited, a company incorporated in Bermuda with limited liability, the shares of which are listed on GEM “core connected person(s)” has the meaning ascribed thereto in the GEM Listing Rules “Director(s)” the director(s) of the Company “GEM” the Growth Enterprise Market of the Stock Exchange “GEM Listing Committee” has the meaning ascribed thereto in the GEM Listing Rules “GEM Listing Rules” The Rules Governing the Listing of Securities on GEM “General Mandates” the Issue Mandate and the Repurchase Mandate “Group” the Company and its subsidiaries “HK$” Hong Kong dollars, the lawful currency of Hong Kong “Hong Kong” the Hong Kong Special Administrative Region of the PRC

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DEFINITIONS

“Issue Mandate”

the proposed general mandate to be granted to the Directors at the AGM to allot, issue and deal with new Shares up to 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the relevant ordinary resolution granting such mandate

“Latest Practicable Date” 30 March 2016, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained herein

• “Notice” the notice convening the AGM as set out on pages 19 to 23 of this circular

“PRC”

the People’s Republic of China, for the purpose of this circular, excluding Hong Kong

“Repurchase Mandate” the proposed general mandate to be granted to the Directors at the AGM to exercise the powers of the Company to repurchase Shares up to a maximum of 10% of the aggregate nominal amount of the issued share capital of the Company in issue as at the date of passing of the relevant ordinary resolution granting such mandate

• “Scheme Mandate Limit”

• being the maximum number of Shares which may be allotted and issued upon exercise of all options to be granted under the existing Share Option Scheme of the Company as stipulated in Rule 23.03(3) of the GEM Listing Rules

“SFO”

• the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong

“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)

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DEFINITIONS

“Share Option(s)” the subscription right(s) attaching to the outstanding option(s) to subscribe for Shares granted by the Company under the existing Share Option Schemes “Share Option Scheme” the share option scheme adopted by the Company on 3 May 2012 “Stock Exchange” The Stock Exchange of Hong Kong Limited “Takeovers Code” The Codes on Takeovers and Mergers and Share Repurchases “%” per cent

– 3 –

LETTER FROM THE BOARD

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China Innovationpay Group Limited 中國創新支付集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 8083)

Executive Directors: Registered office: Guan Guisen Canon’s Court Cao Chunmeng 22 Victoria Street Yan Xiaotian Hamilton, HM 12 Bermuda Independent Non-Executive Directors: Fong Chi Wah Principal place of business Wang Zhongmin and head office in Hong Kong: Gu Jiawang Unit 2708, 27/F The Center 99 Queen’s Road Central Hong Kong 31 March 2016

To the Shareholders

Dear Sir or Madam,

PROPOSED GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, REFRESHMENT OF SCHEME MANDATE LIMIT OF SHARE OPTION SCHEME, PROPOSED RE-ELECTION OF DIRECTORS, RE-APPOINTMENT OF AUDITOR AND

NOTICE OF ANNUAL GENERAL MEETING

1. INTRODUCTION

The purpose of this circular is to provide you with information regarding certain resolutions to be proposed at the Annual General Meeting (the “AGM”) of the Company to be held on 11 May 2016.

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LETTER FROM THE BOARD

2. PROPOSED GRANTING OF THE GENERAL MANDATE

At the annual general meeting held on 6 May 2015, the Shareholders passed an ordinary resolution to give a general mandate to the Directors to allot, issue and deal with Shares. Such general mandate will lapse at the conclusion of the AGM. It is therefore proposed to renew such general mandate at the AGM. The Company proposes to obtain Shareholders’ approval for the General Mandate to allot, issue and otherwise deal with additional Shares up to the limit of 20% of the Shares in issue on the date of the passing of the relevant resolution. The Board has no present plan to issue new shares pursuant to the General Mandate. The General Mandate shall be effective from the date of passing the relevant resolution until whichever is the earliest of:

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

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or other applicable laws to be held; or

• (iii) the revocation or variation of the authority given under the relevant resolution by a special resolution of the Company in general meeting.

As at the Latest Practicable Date, the Company had in issue 6,015,766,457 Shares. Subject to the passing of the proposed resolution for the approval of the General Mandate and in accordance with the terms therein, the Company will be allowed to allot, issue and deal with up to a maximum of 1,203,153,291 Shares on the basis that no further Shares will be issued by the Company prior to the Annual General Meeting.

3. GENERAL MANDATE FOR REPURCHASE OF SHARES

Also at the annual general meeting held on 6 May 2015, the Shareholders passed an ordinary resolution to give a general mandate to the Directors to exercise the powers of the Company to repurchase its own Shares. Such general mandate will lapse at the conclusion of the AGM. It is therefore proposed to renew such general mandate at the AGM.

As at the Latest Practicable Date, the issued share capital of the Company comprised 6,015,766,457 Shares. Assuming that there is no change in the issued share capital between the period from the Latest Practicable Date and the date of passing the resolution approving the Repurchase Mandate, the maximum number of Shares which may be repurchased pursuant to the Repurchase Mandate as at the date of passing the resolution approving the Repurchase Mandate will be 601,576,645 Shares.

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LETTER FROM THE BOARD

An ordinary resolution will be proposed at the AGM to grant to the Directors the Repurchase Mandate, details of which are set out in ordinary resolution number 5 in the notice of AGM. The Shares which may be repurchased pursuant to the Repurchase Mandate is limited to a maximum of 10% of the issued share capital of the Company as at the date of passing of the resolution approving the Repurchase Mandate.

An explanatory statement as required under the GEM Listing Rules, giving certain information regarding the Repurchase Mandate, is set out in Appendix I to this circular.

4. PROPOSED REFRESHMENT OF SCHEME MANDATE LIMIT OF SHARE OPTION SCHEME ADOPTED ON 3 MAY 2012

The existing Share Option Scheme was adopted by the Company pursuant to the ordinary resolution passed by the shareholders of the Company on 3 May 2012. Save for the existing Share Option Scheme, the Company has no other share option scheme currently in force. The Scheme Mandate Limit was set at 10% of the Shares in issue as at the date of adoption of the Share Option Scheme in compliance with the GEM Listing Rules.

Pursuant to the GEM Listing Rules, the maximum number of Shares which may be issued upon exercise of all outstanding options granted and yet to be exercised under the Share Option Schemes and any other scheme(s) of the Company at any time must not in aggregate exceed 30% of the Shares in issue from time to time. No options shall be granted under any schemes of the Company if this will result in the 30% limit being exceeded.

The Shares which may be issued upon exercise of all Share Options to be granted under the existing Share Option Schemes shall not exceed the Scheme Mandate Limit, being 560,550,645 Shares, representing 10% of the Shares in issue when the scheme mandate limit was approved on 6 May 2015 by the Shareholders. In accordance with the GEM Listing Rules, the Scheme Mandate Limit can be refreshed by Shareholders in general meeting provided that the Scheme Mandate Limit as refreshed must not exceed 10% of the Shares in issue on the date of the Shareholders’ approval.

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LETTER FROM THE BOARD

As at the Latest Practicable Date, the Company has granted Options, since the adoption of the Share Option Scheme, to subscribe for 89,690,000 Shares, of which 30,260,000 Options were exercised and 582,000 Options were lapsed. There had been no cancellation of share options. Therefore 58,848,000 Options remain outstanding and not yet exercised. Assuming the total outstanding share options were fully exercised by the holders as at the Latest Practicable Date, it would require the Company to issue 58,848,000 Shares representing approximately 0.98% of the issued share capital of the Company.

Except the above, as at the Latest Practicable Date, the Company, under the Share Option Scheme, had granted Options on 11 June 2015 to subscribe for 202,714,000 Shares, of which 3,408,000 Options were lapsed. There had been no cancellation of share options. Therefore 199,306,000 Options remain outstanding and not yet exercised. Assuming the total outstanding share options were fully exercised by the holders as at the Latest Practicable Date, it would require the Company to issue 199,306,000 Shares representing approximately 3.31% of the issued share capital of the Company.

Save as disclosed above, save for such outstanding Share Options, no other share options had been granted under Share Option Scheme or any other schemes of the Company to the Directors, employees of the Group or such other eligible persons since the last AGM at 6 May 2015 to the Latest Practicable Date. The Directors have no present intention to grant any further Share Options under Share Option Scheme prior to the AGM.

Based on 6,015,766,457 Shares in issue as at the Latest Practicable Date and assuming that no Shares are issued or repurchased by the Company prior to the AGM, the Scheme Mandate Limit will be re-set to 601,576,645 Shares, representing approximately 10% of the issued share capital of the Company as at the date of the AGM in which the refreshed limit is approved and the Company will be allowed to grant further options under Share Option Scheme and any other schemes of the Company carrying the rights to subscribe for a maximum of 601,576,645 Shares or 10% of the issued share capital of the Company as at the date of the AGM. The total number of Shares which may be issued upon exercise of all outstanding Share Options granted and yet to be exercised under Share Option Scheme and any other schemes of the Company will not exceed 30% of the Shares in issue.

The Directors consider that, in order to provide the Company with greater flexibility in granting options to eligible person(s) under Share Option Scheme, the Board decides to seek the approval of the Shareholders to refresh the Scheme Mandate Limit so that the total number of Shares which may be issued upon exercise of all share options to be granted under Share Option Scheme and any other schemes of the Company shall not exceed 10% of the Shares in issue as at the date of passing the relevant resolution at the AGM.

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LETTER FROM THE BOARD

The refreshment of the Scheme Mandate Limit is conditional upon:

• (i) the passing of an ordinary resolution to approve the proposed refreshment of the Scheme Mandate Limit by the Shareholders at the AGM; and

• (ii) the GEM Listing Committee granting the listing of, and permission to deal in, the Shares (representing a maximum of 10% of the issued share capital of the Company as at the date of the AGM approving the proposed refreshment of the Scheme Mandate Limit) which fall to be issued upon the exercise of any options that may be granted under Share Option Scheme and any other schemes of the Company.

Application will be made by the Company to the GEM Listing Committee for the listing of, and permission to deal in, the new Shares (representing a maximum of 10% of the issued share capital of the Company as at the date of the AGM approving the proposed refreshment of the Scheme Mandate Limit) which fall to be issued upon the exercise of any options that may be granted under Share Option Scheme and any other schemes of the Company under the refreshed limit.

The details of the existing Share Option Scheme is set out below:

The purpose of Share Option Scheme is to provide incentives or rewards to participants hereunder for their contribution to the Group and/or to enable the Group to recruit and retain highcalibre employees and attract human resources that are valuable to the Group and any entity in which the Group holds any equity interest.

Pursuant to Share Option Scheme, the Company may grant options to the participants of Share Option Scheme to subscribe for ordinary shares of $0.01 each, subject to, when aggregated under this scheme and any other share option schemes of the Company must not exceed 30% of the total number of shares in issue from time to time. The subscription price will be determined by the Company’s Board of Directors, and will not be less than the higher of (i) the nominal value of the ordinary shares, (ii) the average of the closing price of the ordinary shares quoted on the GEM on the five business days immediately preceding the date of grant, and (iii) the closing price of ordinary shares quoted on the GEM on the date of grant, which must be a business day. An offer of an option shall be deemed to have been granted and accepted when a duplicate letter comprising acceptance of the option duly signed by the participant, together with a remittance of HK$1 by way of consideration for the grant thereof, is received by the Company within a period of 28 days from the date of offer.

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LETTER FROM THE BOARD

The Directors may, at their absolute discretion, invite any person who has contributed to, or can contribute to the Group’s business value and/or technology from product development, sales and marketing, manufacturing to enhancing efficiency of operation to take up options to subscribe for ordinary shares of the Company.

No participant shall be granted an option which would result in the total number of shares issued and to be issued upon exercise of all the options granted and to be granted to such person (including exercised, cancelled and outstanding options) in any 12-month period up to and including the date of such grant representing in aggregate over 1 percent of the total number of shares in issue.

5. RE-ELECTION OF DIRECTORS

In accordance with Bye-Laws, Mr. Cao Chunmeng and Dr. Fong Chi Wah will retire by rotation at the forthcoming AGM and, being eligible, offer themselves for re-election.

Saved as disclosed in Appendix II to this Circular, Mr. Cao Chunmeng and Dr. Fong Chi Wah have no relationships with any directors, senior management, substantial shareholders, or controlling shareholders of the Company.

Pursuant to Rule 17.46A of the GEM Listing Rules, a listed issuer shall disclose the details required under Rule 17.50(2) of the GEM Listing Rules of any directors proposed to be re-elected or proposed new director in the notice or accompanying circular to its shareholders of the relevant general meeting, if such re-election and appointment is subject to shareholders’ approval at the relevant general meeting.

Brief biographical details of the retiring Directors proposed to be re-elected at the AGM are set out in Appendix II to this circular.

6. RE-APPOINTMENT OF AUDITORS

Messrs. RSM Hong Kong will retire as the auditors of the Company at the AGM and, being eligible, offer themselves for re-appointment. The Board proposes to re-appoint Messrs. RSM Hong Kong as the auditors of the Company and to hold office until the conclusion of the next annual general meeting of the Company to be held in 2017.

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LETTER FROM THE BOARD

7. ANNUAL GENERAL MEETING

Notice convening the AGM is set out on page 19 to 23 of this circular. A form of proxy for use by the Shareholders at the AGM is also enclosed.

Whether or not you intend to attend the AGM in person, you are requested to complete the proxy form in accordance with the instructions printed thereon and return the same to the Secretary of the Company at its principal place of business and head office in Hong Kong at Unit 2708, 27/F., The Center, 99 Queen’s Road Central, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding of the AGM or any adjournment thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the AGM or any adjournment thereof should you so wish.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder is required to abstain from voting on the resolutions to be proposed at the AGM.

8. ACTIONS TO BE TAKEN

A form of proxy is enclosed with this circular. Whether or not you are able to attend the Annual General Meeting, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed theron to the Registrar as soon as possible and in any event not less than 48 hours before the time appointed for holding the Annual General Meeting or any adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting at the Annual General Meeting or any adjourned meeting (as the case may be) should you so wish.

9. VOTING BY POLL

Pursuant to Rule 17.47(4) of the GEM Listing Rules, any vote of Shareholders at a general meeting must be taken by poll. Therefore, all resolutions proposed at the AGM shall be voted by poll.

An announcement on the poll results will be made by the Company after the AGM.

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LETTER FROM THE BOARD

10. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM 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.

11. RECOMMENDATION

The Directors consider that the granting of the Repurchase Mandate and the New Issue Mandate, the refreshment of Scheme Mandate Limit of the existing Share Option Scheme, the reelection of Directors and the re-appointment of auditors are in the best interests of the Company, the Group and the shareholders as a whole and so recommend the shareholders to vote in favour of the resolutions to be proposed at the AGM. The Directors will vote all their shareholdings in favour of the resolutions.

Yours faithfully,

For and on behalf of China Innovationpay Group Limited Guan Guisen

Chairman

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EXPLANATORY STATEMENT

APPENDIX I

The following is the explanatory statement given to all shareholders which is required by Rule 13.08 of the GEM Listing Rules and under the Share Buy Back Rules in connection with the proposed Repurchase Mandate.

(I) GEM LISTING RULES RELATING TO THE REPURCHASE OR SHARES

The GEM Listing Rules permit companies whose primary listing is on the Stock Exchange to repurchase their shares on the Stock Exchange and any other stock exchange on which the securities of the company are listed and such exchange is recognized by the Securities and Future Commission of Hong Kong subject to certain restrictions. Among such restrictions, the GEM Listing Rules provide the shares of such company must be fully paid up and all repurchase of shares by such company must be approved in advance by an ordinary resolution of shareholders, either by way of a general repurchase mandate or by specific approval of a particular transaction.

(II) SHARE CAPITAL

As the Latest Practicable Date, the issued share capital of the Company comprised 6,015,766,457 Shares.

(III) THE REPURCHASE PROPOSAL

The resolution set out in Resolution 5 in the notice convening the AGM which will be proposed at the AGM relates to the granting of a general and unconditional mandate (the “Repurchase Mandate”) to the Directors to repurchase, on GEM or any other stock exchange on which the Shares may be listed and recognised by the Securities and Futures Commission, Shares up to a maximum of 10% of the issued share capital of the Company at the date of passing the resolution (the “Repurchase Proposal”). Exercise in full of the Repurchase Mandate, on the basis of 6,015,766,457 shares in issue as at the Latest Practicable Date, would result in 601,576,645 shares (representing 10% of the total issued share capital of the Company).

Subject to the passing of the ordinary resolution granting the Repurchase Mandate and on the basis that no further Shares are issued or repurchased prior to the AGM, the Company would be allowed to repurchase a maximum of 601,576,645 fully paid-up Shares (representing 10% of the issued share capital of the Company as at the date of passing of the relevant resolution at the AGM) during the period ending on the earliest of (i) the conclusion of the next annual general meeting of the Company; or (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws or the Companies Act 1981 of Bermuda (as amended) to be held; or (iii) the date upon which such authority is revoked or varied by an ordinary resolution of Shareholders in general meeting.

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EXPLANATORY STATEMENT

APPENDIX I

(IV) REASONS FOR REPURCHASE

Although the Directors have no present intention of repurchasing the Shares, they believe that it is in the best interests of the Company and the Shareholders for the Directors to have a general authority from the Shareholders to enable the Company to repurchase Shares in the market. Such repurchase may, depending on the market conditions and funding arrangement at the time, lead to an enhancement of the net assets value of the Company and/or its earnings per Share and will only be made when the Directors believe that such a repurchase will benefit the Company and the Shareholders.

(V) FUNDING OF REPURCHASES

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with its Bye-Laws, the GEM Listing Rules and the applicable laws of Bermuda.

It is envisaged that the funds required for any repurchase of Shares would be derived from the capital paid up on the Shares being repurchased and from the distributable profits of the Company.

An exercise of the Repurchase Mandate in full might have a material adverse impact on the working capital and gearing position of the Company (as compared with the position disclosed in its most recent published audited accounts as at 31 December 2015) in the event that the Repurchase Mandate were to be carried out in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Repurchase Mandate to such extent as would, in the circumstances, have a material adverse impact on the working capital requirements or the gearing levels of the Company which in the opinion of the Directors are from time to time appropriate for the Company.

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EXPLANATORY STATEMENT

APPENDIX I

(VI) SHARE PRICES

The highest and lowest prices at which the Shares have been traded on GEM during each of the twelve months preceding the Latest Practicable Date were as follows:

	Share Prices
	Highest	Lowest
	HK$	HK$
2015
March	0.670	0.550
April	0.930	0.670
May	1.460	0.820
June	1.460	0.950
July	1.140	0.370
August	0.650	0.400
September	0.590	0.430
October	0.560	0.495
November	0.520	0.440
December	0.480	0.395
2016
January	0.415	0.280
February	0.405	0.250
March (up to the Latest Practicable Date)	0.385	0.33

(VII) GENERAL INFORMATION

• (a) None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their close associates, have any present intention to sell any Shares to the Company or any of its subsidiaries under the Repurchase Mandate if such is approved by the Shareholders.

• (b) The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the powers of the Company to make repurchases pursuant to the Repurchase Mandate in accordance with the Bye-Laws, the GEM Listing Rules and the applicable laws of Bermuda.

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EXPLANATORY STATEMENT

APPENDIX I

• (c) No core connected persons (as defined in the GEM Listing Rules) of the Company has notified the Company that they have a present intention to sell Shares to the Company or its subsidiaries, or have undertaken not to do so, if the Repurchase Mandate is exercised.

(VIII) TAKEOVERS CODE

If as the result of a repurchase of the Shares, a Shareholder ‘s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of the Takeovers Code. As a result, a Shareholder, or group of Shareholders acting in concert, depending on the level of increase of the Shareholder ‘s interest, could obtain or consolidate control of the Company and become obliged to make a mandatory general offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, to the best of the knowledge and belief of the Directors, Mighty Advantage Enterprises Limited, wholly owned by Mr. Guan Guisen, a substantial shareholder of the Company and an executive Director, held 1,311,792,000 Shares, representing approximately 21.81% of the existing issued share capital of the Company. In the event that the Directors exercise in full the Repurchase Mandate, the interest of Mighty Advantage Enterprises Limited in the Company would be increased to approximately 24.23% of the issued share capital of the Company. No obligation to make a mandatory offer under the Takeovers Code would arise.

As at the Latest Practicable Date, the Directors have no present intention to exercise the Repurchase Mandate.

(IX) SHARES PURCHASE MADE BY THE COMPANY

The Company had not purchased any Shares (whether on the GEM or otherwise) in the previous six months prior to the Latest Practicable Date.

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APPENDIX II

BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

The biographical details of the retiring Directors proposed to be re-elected at the AGM are set out as follows:

Mr. Cao Chunmeng, aged 44, joined the Company in March 2011 and acted as Vice President of the Company. Mr. Cao was appointed as executive Director and Chief Executive Officer of the Company on 11 July 2012. Mr. Cao held a bachelor’s degree in Computer Science from Shandong University in 1994. And he obtained a master’s degree in business administration from Peking University in 2006. He worked at Shandong Branch of Industrial and Commercial Bank of China Limited, acted as General Manager in 濟南先得科技有限公司 (Jinan Xiande Technology Limited), Senior Deputy President in 豐元信（中國）有限公司 (Fengyuanxin (China) Limited), General Manager in 縱橫天地（北京）資訊技術有限公司 (Zongheng Tiandi (Beijing) Information Technology Limited) and as Vice President in 北控易碼通（北京）電子商務有限公 司 (Beikong Easycode (Beijing) Electric Commerce Ltd). And from April of 2010, Mr. Cao acts as Vice President of Beijing Shangyin Investment Consultancy Co., Limited（商銀融通（北京）投資 諮詢有限公司）. From July 2012, Mr. Cao acts as executive director of Kopu (Beijing) Technology Co., Ltd.（靠譜輝程（北京）科技有限公司）. Mr. Cao has over 19 years of financialinformation technology Internet industry managementexperience.

Pursuant to a service contract entered into between the Company and Mr. Cao, his appointment as an executive Director is for a term of three years and shall continue thereafter subject to retirement by rotation at least once every three years in accordance with the Company’s Bye-laws 99 and is eligible offer himself for re-election as director in the AGM. He is entitled to a director ‘s fee of HK$1,440,000 per annum, which is determined by the prevailing market conditions and his roles and responsibilities in the Company.

As at the date of this circular, the interests or short positions of Mr. Cao in the Shares, underlying shares and debentures of the Company or any associated corporation (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 or 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, pursuant to Rules 5.46 to 5.67 of the GEM Listing Rules relating to securities transactions by Directors to be notified to the Company and the Stock Exchange, were as follows:

		Interest in	Total
	Interest in	underlying	interest	%
Name of Director	shares	shares	in shares	Shareholding
Mr. Cao Chunmeng	47,620,000	55,800,000	103,420,000	1.72%
		(Note)

Note: The Company granted the share options under New Share Option Scheme on 6 July 2012 and 11 June 2015.

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APPENDIX II

BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

Save as disclosed above, as at the Latest Practicable Date Mr. Cao Chunmeng does not have any interests or short positions in any Shares, underlying Shares or debentures of the Company and its associated corporations within the meaning of Part XV of the SFO. He has confirmed that there is no other information relating to his appointment which is required to be disclosed pursuant to Rule 17.50(2)(h) to (v) of the GEM Listing Rules or matters needed to be brought to the attention of the Shareholders. Save as disclosed herein, Mr. Cao has confirmed that he does not hold any other position with the Company and other members of the Group, or any other directorship in other listed public companies in Hong Kong or overseas in the last three years.

Mr. Cao does not have any relationship with any Directors, senior management, management shareholders, substantial shareholders or controlling shareholders of the Company and any of their respective associates (as defined under GEM Listing Rules) as at the Latest Practicable Date.

Dr. Fong Chi Wah, aged 53, joined the Group in December 19, 2003. Dr. Fong is a Chartered Financial Analyst, a member of Hong Kong Institute of CPAs and the Institute of Certified Management Accountants, Australia, and the Hong Kong Institute of Directors. Dr. Fong has over 25 years of experience in various sectors of the financial industry, including direct investment, project and structured finance and capital markets, with a focus on the PRC and Hong Kong. Dr. Fong was a director of Baring Capital (China) Management Limited and held various management positions in ING Bank. He was appointed as an executive director of National Investments Fund Limited on November 1, 2005 and an independent non-executive director of Real Nutriceutical Group Limited on March 28, 2008, and both companies are listed on the Stock Exchange. Fong obtained a bachelor’s degree in management science (economics) from Lancaster University, United Kingdom, in 1984, a master’s degree in business administration from Warwick University, United Kingdom, in 1986, a master’s degree in investment management from the Hong Kong University of Science and Technology in 1999, a master’s degree in practising accounting from Monash University, Australia, in 2001, a doctorate in business administration from the Hong Kong Polytechnic University in 2007 and a juris doctor’s degree from the Chinese University of Hong Kong in 2013.

Pursuant to a service contract entered into between the Company and Dr. Fong , his appointment as an independent non-executive Director is for a term of three years and shall continue thereafter subject to retirement by rotation at least once every three years in accordance with the Company’s Bye-laws 99 and is eligible offer himself for re-election as director in the AGM. He is entitled to a director ‘s fee of HK$120,000 per annum, which is determined by the prevailing market conditions and his roles and responsibilities in the Company.

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BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

APPENDIX II

As at the date of this circular, the interests or short positions of Dr. Fong in the Shares, underlying shares and debentures of the Company or any associated corporation (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 or 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, pursuant to Rules 5.46 to 5.67 of the GEM Listing Rules relating to securities transactions by Directors to be notified to the Company and the Stock Exchange, were as follows:

		Interest in	Total
	Interest in	underlying	interest	%
Name of Director	shares	shares	in shares	Shareholding
Dr. Fong Chi Wah	–	4,000,000	4,000,000	0.07%
		(Note)

Note: The Company granted the share options under New Share Option Scheme on 6 July 2012 and 11 June 2015.

Save as disclosed above, as at the Latest Practicable Date Dr. Fong Chi Wah does not have any interests or short positions in any Shares, underlying Shares or debentures of the Company and its associated corporations within the meaning of Part XV of the SFO. He has confirmed that there is no other information relating to his appointment which is required to be disclosed pursuant to Rule 17.50(2)(h) to (v) of the GEM Listing Rules or matters needed to be brought to the attention of the Shareholders. Save as disclosed herein, Dr. Fong has confirmed that he does not hold any other position with the Company and other members of the Group, or any other directorship in other listed public companies in Hong Kong or overseas in the last three years.

Dr. Fong does not have any relationship with any Directors, senior management, management shareholders, substantial shareholders or controlling shareholders of the Company and any of their respective associates (as defined under GEM Listing Rules) as at the Latest Practicable Date.

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NOTICE OF AGM

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China Innovationpay Group Limited 中國創新支付集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 8083)

NOTICE IS HEREBY GIVEN that the annual general meeting of China Innovationpay Group Limited (the “Company”) will be held at Yue Function Room, First Floor, City Garden Hotel, 9 City Garden Road, North Point, Hong Kong at 10:00 a.m. on Wednesday, 11 May 2016 for the following purposes:

1. To receive and consider the audited financial statements and the reports of the directors and auditors for the year ended 31st December 2015.

2. To re-elect retiring directors and authorise the board of directors to fix their remuneration.

3. To re-appoint auditors of the Company and to authorise the board of directors to fix their remuneration.

As special business, to consider and, if thought fit, to pass the following resolutions as ordinary resolutions of the Company:

1. “ THAT

2. (i) subject to paragraph (iii) of this resolution, pursuant to the Rules Governing the Listing of Securities on the Growth Enterprise Market (“GEM”) on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”), the exercise by the directors of the Company during the Relevant Period (as defined below) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares) which might require the exercise of such powers be and is hereby generally and unconditionally approved;

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NOTICE OF AGM

• (ii) the approval in paragraph (i) of this resolution shall authorise the directors of the Company during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such powers after the end of the Relevant Period;

• (iii) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the directors of the Company pursuant to the approval in paragraph (i) of this resolution, otherwise than pursuant to (a) a Rights Issue (as defined below), (b) the exercise of warrants to subscribe for shares of the Company or the exercise of options granted under any ordinary share option scheme adopted by the Company, or (c) an issue of shares of the Company in lieu of whole or part of a dividend on shares of the Company in accordance with the bye-laws of the Company, shall not exceed 20% of the aggregate nominal amount of the share capital of the Company in issue as at the date of the passing of this resolution and this approval shall be limited accordingly; and

• (iv) for the purpose of this resolution:

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

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

• (b) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or the Company Act 1981 of Bermuda (amended) or any applicable laws to be held; and

• (c) the date on which the authority sets out in this resolution is revoked or varied by an ordinary resolution in general meeting.

“Rights Issue” means offer of shares of the Company open for a period fixed by the directors of the Company to holders of shares on the register of members of the Company on a fixed record date in proportion to their then holdings of such shares as at that date (subject to such exclusions or other arrangements as the directors of the Company may deem necessary or expedient in relation to overseas shareholders or fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of, any recognised regulatory body or any stock exchange in any territory outside Hong Kong).”

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NOTICE OF AGM

1. “ THAT

2. (i) subject to paragraph (ii) of this resolution, the exercise by the directors of the Company during the Relevant Period (as defined below) of all powers of the Company to repurchase issued shares in the capital of the Company on GEM or any other stock exchange on which the securities of the Company may be listed and recognized by the Securities and Futures Commission of Hong Kong and the Stock Exchange for such purpose, subject to and in connection with all applicable laws and/or the requirements of the Rules Governing the Listing of Securities on GEM or of any other stock exchange as amended from time to time, be and the same is hereby generally and unconditionally approved;

3. (ii) the aggregate nominal amount of shares of the Company which the Company is authorised to repurchase pursuant to the approval in paragraph (i) of this resolution shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue as at the date of the passing of this resolution, and this approval shall be limited accordingly; and

4. (iii) for the purpose of this resolution:

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

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

• (b) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or the Company Act 1981 of Bermuda (as amended) or any applicable laws to be held; and

• (c) the date on which the authority sets out for this resolution is revoked or varied by an ordinary resolution in general meeting.”

• “ THAT conditional upon ordinary resolutions nos. 4 and 5 above being passed, the aggregate nominal amount of shares of the Company which are repurchased by the Company under the authority granted to the directors of the Company as mentioned in ordinary resolution no. 5 above shall be added to the aggregate nominal amount of share capital that may be allotted or agreed conditionally or unconditionally to be allotted by the directors of the Company pursuant to ordinary resolution no. 4 above.”

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NOTICE OF AGM

1. “ THAT the existing scheme mandate limit in respect of the granting of options to subscribe for shares of the Company (the “Shares”) under the existing share option scheme adopted by the Company on 3 May 2012 (the “Share Option Scheme”) provided that the total number of Shares which may be allotted and issued upon exercise of the options to be granted under the Share Option Scheme shall not exceed 10 per cent of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing this resolution (the “Refreshed Limit”) and subject to the Listing Committee of the Stock Exchange granting the listing of and permission to deal in the Shares to be issued pursuant to the exercise of the Options to be granted under the Refreshed Limit and in compliance with the Rules Governing the Listing of Securities on the Stock Exchange, the directors of the Company be and are hereby authorised, at their absolute discretion, to grant Options and to allot and issue Shares pursuant to the exercise of any Options up to the Refreshed Limit.”

By order of the Board China Innovationpay Group Limited Guan Guisen Chairman

Hong Kong, 31 March 2016

Head Office and Principal Place of Business: Unit 2708, 27/F. The Center 99 Queen’s Road Central Hong Kong

Notes:

1. Any member entitled to attend and vote at the AGM is entitled to appoint one or more separate proxies to attend and vote instead of him/her. If more than one proxy is so appointed, the appointment shall specify the number and class of shares in respect of which each such proxy is so appointed. A proxy need not be a member of the Company.

2. Where there are joint holders of any share, any one of such persons may vote at the AGM, either personally or by proxy, in respect of such share as if he/she were solely entitled thereto, provided that if more than one of such joint holders be present at the AGM personally or by proxy, the person whose name stands first in the register in respect of such share shall alone be entitled to vote in respect thereof.

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NOTICE OF AGM

1. To be valid, a form of proxy in the prescribed form together with the power of attorney or other authority (if any) under which it is signed (or a notarially certified copy thereof) must be deposited at the Company c/o the Company Secretary at the Company’s principal place of business and head office in Hong Kong at Unit 2708, 27/F., The Center, 99 Queen’s Road Central, Hong Kong not less than 48 hours before the time appointed for holding the AGM or any adjourned meeting. Delivery of the form of proxy shall not preclude a member of the Company from attending and voting in person at the AGM and any adjourned meeting and, in such event, the instrument appointing a proxy shall be deemed to be revoked.

2. An explanatory statement containing further details regarding ordinary resolutions nos. 4 to 6 as required by the Rules Governing the Listing of Securities on GEM is set out in appendix I to the circular of the Company dated 31 March 2016.

3. Particulars of the retiring directors are set out in appendix II to circular of the Company dated 31 March 2016.

4. A form of proxy for use in connection with the AGM is enclosed and such form is also published on the website of GEM at www.hkgem.com and on the Company’s website at www.innovationpay.com.hk.

5. As at the date of this notice, the Board comprises three executive Directors, namely Mr. Guan Guisen, Mr. Cao Chunmeng and Mr. Yan Xiaotian; and three independent non-executive Directors, namely Dr. Fong Chi Wah, Mr. Wang Zhongmin and Mr. Gu Jiawang.

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