Red Star Macalline Group Corporation Ltd Class ASSE: 601828

Proposed amendments to the articles of association; proposed amendments to the procedural rules of the general meetings; proposed amendments to the procedural rules of the board of directors and notice of the 2020 third extraordinary general meeting

Aug 20, 2020 at 9:56 AM UTC · Issued by Red Star Macalline Group Corporation Ltd Class A

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your Shares in Red Star Macalline Group Corporation Ltd., you should at once hand this circular together with the proxy form to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

Red Star Macalline Group Corporation Ltd.

紅星美凱龍家居集團股份有限公司

(A sino-foreign joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1528)

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION PROPOSED AMENDMENTS TO THE PROCEDURAL RULES OF THE GENERAL MEETINGS

PROPOSED AMENDMENTS TO THE PROCEDURAL RULES OF

THE BOARD OF DIRECTORS

AND

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

A letter from the Board is set out on pages 2 to 20 of this circular. A notice of the extraordinary general meeting (the"EGM") to be held at 2:00 p.m. on Friday, 11 September 2020 at Conference Center, 3/F, South Building, Block B, Red Star Macalline Headquarters, Lane 1466, Shenchang Road, Minhang District, Shanghai, the People's Republic of China (the "PRC"), is being dispatched to the Shareholders together with this circular.

Shareholders who intend to appoint a proxy to attend the EGM shall complete and return the proxy form in accordance with the instructions printed thereon. The proxy form must be signed by you or your attorney duly authorised in writing or, in case of a legal person, must either be executed under its seal or under the hand of its director or other attorney duly authorised to sign the same. If the proxy form is signed by an attorney of the appointor, the power of attorney authorising that attorney to sign, or other document of authorisation, must be notarized.

In the case of joint holders of Shares of the Company, only the holder whose name stands first in the register of members of the Company shall alone be entitled to vote at the EGM, either in person or by proxy in respect of such Shares.

For H Share Shareholders, please return the proxy form together with any documents of authority to Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong as soon as possible, and in any event not later than 24 hours before the time appointed for holding the EGM. For A Share Shareholders, please return the proxy form together with any documents of authority to the headquarters of the Company in the PRC at B1 Corporate Post Office, Block A, Red Star Macalline Headquarters, No. 5, Lane 1466, Shenchang Road, Minhang District, Shanghai, the PRC as soon as possible, and in any event not later than 24 hours before the time appointed for holding the EGM. Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

21 August 2020

CONTENTS

		Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
1.	INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
2.	MATTERS TO BE CONSIDERED AT THE EGM . . . . . . . . . . . . . . . .	3
3.	THE 2020 THIRD EXTRAORDINARY GENERAL MEETING . . . . . . . . . .	20

4. RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING . . . . . . .

Note: If there are any discrepancies between the Chinese version and the English version of this circular, the Chinese version shall prevail.

- i -

		DEFINITIONS

	In this circular, unless the context otherwise requires, the following terms shall have the following
meanings:
"A Share(s)"	the ordinary share(s) issued by the Company, with a nominal value of
		RMB1.0 each, listed on the Shanghai Stock Exchange and traded in RMB
"A Share Shareholder(s)"	the holder(s) of the A Share(s)
"Articles of Association"	the articles of association of the Company
"Board"	the board of directors of the Company
"Company"	Red Star Macalline Group Corporation Ltd. (紅星美凱龍家居集團股份
		有限公司), a sino-foreign joint stock company incorporated in the PRC
		with limited liability, whose H Shares are listed on the main board of The
		Stock Exchange of Hong Kong Limited (stock code: 1528)
"EGM" or "2020 Third	the extraordinary general meeting of the Company to be convened and
	Extraordinary General	held on 11 September 2020
	Meeting"
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC
"H Share(s)"	overseas-listed foreign invested ordinary share(s) with a nominal value
		of RMB1.0 each in the share capital of the Company, which is/are listed
		on The Stock Exchange of Hong Kong Limited and traded in Hong Kong
		dollars
"H Share Shareholder(s)"	the holder(s) of the H Share(s)
"Listing Rules"	the Rules Governing the Listing of Securities on The Stock Exchange of
		Hong Kong Limited
"PRC"	the People's Republic of China, which, for the purpose of this circular,
		excludes Hong Kong, the Macau Special Administrative Region and
		Taiwan
"Procedural Rules of	the Procedural Rules of the Board of Directors of Red Star Macalline
the Board of Directors"	Group Corporation Ltd.
"Procedural Rules of	the Procedural Rules of the General Meetings of Red Star Macalline
	the General Meetings"	Group Corporation Ltd.
"RMB"	Renminbi, the lawful currency of the PRC
"Share(s)"	the A Share(s) and H Share(s)
"Shareholder(s)"	the A Share Shareholder(s) and the H Share Shareholder(s) of the
		Company
"Stock Exchange" or	The Stock Exchange of Hong Kong Limited
"Hong Kong Stock Exchange"

- 1 -

LETTER FROM THE BOARD

Red Star Macalline Group Corporation Ltd.

紅星美凱龍家居集團股份有限公司

(A sino-foreign joint stock company incorporated in the People's Republic of China with limited liability)

	(Stock Code: 1528)
Executive Directors:	Registered office in the PRC:
Mr. CHE Jianxing	Suite F801, 6/F
Mr. GUO Binghe	No. 518, Linyu Road
Ms. CHE Jianfang	Pudong New District
Mr. JIANG Xiaozhong	Shanghai
	PRC
Non-executive Directors:
Ms. CHEN Shuhong	Principal place of business
Mr. XU Guofeng	in Hong Kong:
Mr. JING Jie	31/F, Tower 2
Mr. XU Hong	Times Square
	1 Matheson Street
Independent non-executive Directors:	Causeway Bay
Mr. LEE Kwan Hung, Eddie	Hong Kong
Mr. QIAN Shizheng
Mr. WANG Xiao
Ms. ZHAO Chongyi
	21 August 2020
To the Shareholders
Dear Sir or Madam,

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION PROPOSED AMENDMENTS TO THE PROCEDURAL RULES OF THE GENERAL MEETINGS

PROPOSED AMENDMENTS TO THE PROCEDURAL RULES OF

THE BOARD OF DIRECTORS

AND

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

1. INTRODUCTION

At the Board meeting held on 19 August 2020, the following resolutions have been passed by the Board of the Company: (1) the resolution on the amendments to the Articles of Association; (2) the resolution on the amendments to the Procedural Rules of the General Meetings; and (3) the resolution on the amendments to the Procedural Rules of the Board of Directors.

The above resolutions shall be approved by the Shareholders by way of special resolutions.

- 2 -

LETTER FROM THE BOARD

The purpose of this circular is to provide you with the notice of the EGM and information on certain proposed resolutions to be considered at the EGM so that you are able to make an informed decision on whether to vote for or against those resolutions at the EGM.

2. MATTERS TO BE CONSIDERED AT THE EGM

Proposed Amendments to the Articles of Association
The Board proposes making certain amendments to the Articles of Association according to the provisions of the Securities Law of the People's Republic of China (implemented from 1 March 2020), the Guidelines for the Articles of Association of Listed Companies (2019 Revision) and other laws and regulations and normative documents, and based on the actual situation of the Company in order to further improve the corporate governance system of the Company.
Details of the amendments to the Articles of Association are as follows:

		Proposed Amendments to
Existing Terms of Articles of Association		Articles of Association

Article 35If the directors, supervisors,	Article 35If the directors, supervisors,
senior executives of the Company or any	senior executives of the Company or any
shareholders who holds more than 5% of the	shareholders who holds more than 5% of the
domestic shares of the Company, sell his/her	domestic shares of the Company, sell his/her
shares in the Company within six months of	shares in the Company or other securities
his/her purchase, or purchase the shares again	with an equity naturewithin six months of
within six months after the sale, the profits	his/her purchase, or purchase the shares or
thus made shall accrue to the Company and	other securities with an equity natureagain
the Board shall collect all such profits. If a	within six months after the sale, the profits
securities company serving as the underwriter	thus	made shall	accrue	to the Company
purchases all the unsold shares and therefore	and the Board shall collect all such profits.
holds more than 5% of the shares, it is not	However,if a securities company serving
subject to the six months restriction against	as the underwriterpurchases all the unsold
selling such shares.	underwrittenshares and therefore holds
	more than 5% of the shares, it is not subject
If the Board fails to comply with the	to the six months restriction against selling
provision set out in the preceding paragraph,	such shares, and other circumstances
the shareholders have the right to request	stipulated by the securities regulatory
the Board to do so within 30 days. The	authority under the State Council are
shareholders have the right to initiate	excluded.
litigation in the court directly in their own
name for the interests of the Company if the	The	shares	or	other	securities	with
Board fails to comply with the provision	an equity nature held by directors,
within the period specified hereinabove.	supervisors,	senior	executives	and
	individual shareholders referred to in the
If the Board refuses to comply with	preceding paragraph include the shares or
paragraph (1) of this Article, the directors at	other securities with an equity nature held
fault shall be collectively responsible under	by their spouses, parents, and children,
the relevant laws.	and any of the above which is indirectly
	held in others' accounts.

- 3 -

LETTER FROM THE BOARD

							Proposed Amendments to
Existing Terms of Articles of Association		Articles of Association

						If the Board fails to comply with the
						provision set out in the precedingparagraph
						(1) of this Article, the shareholders have the
						right to request the Board to do so within
						30 days. The shareholders have the right to
						initiate litigation in the court directly in their
						own name for the interests of the Company if
						the Board fails to comply with the provision
						within the period specified hereinabove.
						If the Board refuses to comply with
						paragraph (1) of this Article, the directors at
						fault shall be collectively responsible under
						the relevant laws.

Article 46Change of the shareholders'	Article 46Change of the shareholders'
register arising	from	share	transfer	shall	register arising	from	share	transfer	shall
not be registered within 30 days before	not be registered within 30 days before
convening of a general meeting or within	convening of a general meeting or within five
five days prior to the benchmark date on	days prior to the benchmark date on which
which the Company decides to distribute	the Company decides to distribute dividends.
dividends. If the relevant stock exchange or	If the laws, administrative regulations,
the regulatory authority at the location where	departmental rules, normative documents
the Company's shares are listed provides	andthe relevant stock exchange or the
otherwise, such regulations shall prevail.		regulatory authority at the location where
						the Company's shares are listed provides
						otherwise during the period of closure of
						the register of members prior to a general
						meeting or before the benchmark date on
						which the Company decides to distribute
						dividends, such regulations shall prevail.

Article 61A general meeting shall exercise	Article 61A general meeting shall exercise
the following functions and powers:		the following functions and powers:
(I)	To decide the business operation	(I)	To decide the business operation
	guideline and investment plan for the		guideline and investment plan for the
	Company;						Company;
(II)	To elect	and	replace	directors	and	(II)	To elect	and	replace	directors	and
	to decide on matters relating to		to decide on matters relating to
	remuneration of the directors;			remuneration of the directors;
(III) To elect and replace supervisors who	(III) To elect and replace supervisors who
	are not the employee representative		are not the employee representative
	and to decide on matters relating to		and to decide on matters relating to
	remuneration of the supervisors;			remuneration of the supervisors;

- 4 -

LETTER FROM THE BOARD

					Proposed Amendments to
Existing Terms of Articles of Association		Articles of Association

(IV)	To examine and approve reports of the	(IV)	To examine and approve reports of the
	Board;				Board;
(V)	To examine and approve reports of the	(V)	To examine and approve reports of the
	Supervisory Committee;			Supervisory Committee;
(VI)	To examine and approve the annual	(VI)	To examine and approve the annual
	financial budgets and final accounting		financial budgets and final accounting
	plans of the Company;			plans of the Company;
(VII)	To examine and approve the	(VII)	To examine and approve the
	Company's profit distribution plan and		Company's profit distribution plan and
	loss recovery plan;			loss recovery plan;
(VIII) To resolve on increase or decrease of	(VIII) To resolve on increase or decrease of
	the registered capital of the Company;		the registered capital of the Company;
(IX)	To resolve on	the merger,	division,	(IX)	To resolve on	the merger,	division,
	d i s s o l u t i o n ,	l i q u i d a t i o n o r		d i s s o l u t i o n ,	l i q u i d a t i o n o r
	transformation of the Company;		transformation of the Company;
(X)	To resolve on the issuance of corporate	(X)	To resolve on the issuance of corporate
	bonds and other securities and the		bonds and other securities and the
	listing of the Company;			listing of the Company;
(XI)	To resolve on the appointment,	(XI)	To resolve on the appointment,
	removal or non-reappointment of		removal or non-reappointment of
	certified public accountants of the		certified public accountants of the
	Company;				Company;
(XII)	To amend the Articles of Association;	(XII)	To amend the Articles of Association;
(XIII)	To examine proposals made by	(XIII)	To examine proposals made by
	shareholders	severally or	jointly		shareholders	severally or	jointly
	representing more than 3% of the		representing more than 31% of the
	voting shares of the Company;		voting shares of the Company;
(XIV)	To examine and approve the	(XIV)	To examine and approve the
	guarantees under Article 62;			guarantees under Article 62;

- 5 -

LETTER FROM THE BOARD

					Proposed Amendments to
Existing Terms of Articles of Association		Articles of Association

(XV)	To examine the Company's purchase	(XV)	To examine the Company's purchase
	or disposal of major assets	within		or disposal of major assets	within
	one year or matters with the amount		one year or matters with the amount
	guaranteed exceeding 30% of the total		guaranteed exceeding 30% of the total
	assets of the Company;			assets of the Company;
(XVI)	To examine and approve any changes	(XVI)	To examine and approve any changes
	to the use of proceeds;			to the use of proceeds;
(XVII)	To review share incentive plans;	(XVII)	To review share incentive plans;
(XVIII)	To resolve on other matters	which,	(XVIII)	To resolve on other matters	which,
	in accordance with the laws,		in accordance with the laws,
	administrative	regulations,	listing		administrative	regulations,	listing
	rules of the stock exchange with which		rules of the stock exchange with which
	the Company's shares are listed and		the Company's shares are listed and
	the Articles of Association, shall be		the Articles of Association, shall be
	approved by a general meeting.			approved by a general meeting.

Article 68The contents of the resolutions	Article 68The contents of the resolutions
must be within the scope of duties of general	must be within the scope of duties of general
meetings. It must contain clear topics and	meetings. It must contain clear topics and
detailed matters to be resolved at the meeting,	detailed matters to be resolved at the meeting,
and be in compliance with the relevant laws,	and be in compliance with the relevant laws,
administrative regulations and the Articles of	administrative regulations and the Articles of
Association.			Association.
At general meetings of the Company, the	At general meetings of the Company, the
Board, the Supervisory Committee, and	Board, the Supervisory Committee, and
shareholder(s) individually or jointly holding	shareholder(s) individually or jointly holding
more than 3% of the Company's shares	more than 31% of the Company's shares
shall have the right to propose motions to	shall have the right to propose motions to
the Company. The content of a proposal	the Company. The content of a proposal
shall be determined by the general meeting,	shall be determined by the general meeting,
have	definite topics	and specific	issues	have	definite topics	and specific	issues
for resolution, and shall comply with the	for resolution, and shall comply with the
provisions of the laws, regulations and the	provisions of the laws, regulations and the
Articles of Association.			Articles of Association.

- 6 -

LETTER FROM THE BOARD

					Proposed Amendments to
Existing Terms of Articles of Association	Articles of Association

Shareholder(s) individually or jointly holding	Shareholder(s) individually or jointly holding
more than 3 % of the Company's shares	more than 31% of the Company's shares
may submit	a written	provisional	motion	may submit	a written	provisional	motion
to the convener 10 days before a general	to the convener 10 days before a general
meeting is convened; the convener shall	meeting is convened; the convener shall
issue a supplementary notice of general	issue a supplementary notice of general
meeting within	two	days after	receipt	meeting within	two	days after	receipt
of the said provisional motion, to notify	of the said provisional motion, to notify
other shareholders and to submit the said	other shareholders and to submit the said
provisional proposal to the general meeting	provisional proposal to the general meeting
for consideration.				for consideration.
Except as provided in the preceding	Except as provided in the preceding
paragraph,	after	the	convener issues a	paragraph,	after	the	convener issues a
public notice of the general meeting, he/she	public notice of the general meeting, he/she
shall not change the proposals or add any	shall not change the proposals or add any
new proposals in the notice of the general	new proposals in the notice of the general
meeting.					meeting.
Proposals not set out in the notice of general	Proposals not set out in the notice of general
meeting or not complying with the provision	meeting or not complying with the provision
herein shall not be voted on or resolved at the	herein shall not be voted on or resolved at the
general meeting.				general meeting.

Article 85	Shareholders (including proxies	Article 85	Shareholders (including proxies
thereof) who vote at a general meeting shall	thereof) who vote at a general meeting shall
exercise their voting rights as per the number	exercise their voting rights as per the number
of voting shares they represent. Each share	of voting shares they represent. Each share
carries the right to one vote.		carries the right to one vote.
When material issues affecting the interests	When material issues affecting the interests
of small and medium investors are being	of small and medium investors are being
considered at the general meeting, the votes	considered at the general meeting, the votes
of such investors shall be counted separately.	of such investors shall be counted separately.
The separate counting results shall be	The separate counting results shall be
promptly and publicly disclosed.		promptly and publicly disclosed.
Shares held by the Company have no voting	Shares held by the Company have no voting
rights, and such shares will not be included in	rights, and such shares will not be included in
the total number of shares with voting rights	the total number of shares with voting rights
at the general meeting.			at the general meeting.

- 7 -

LETTER FROM THE BOARD

						Proposed Amendments to
Existing Terms of Articles of Association	Articles of Association

The Board, independent non-executive	The Board, independent non-executive
directors	and	shareholders	who	satisfy	directors and shareholders who satisfy the
the	relevant	regulations	and conditions	relevant regulations and conditions may
may	publicly	solicit voting	rights	from	publicly solicit voting rights from the
the shareholders. When soliciting voting	shareholders. When soliciting voting rights
rights from the shareholders, information	from the shareholders, information such as
such	as	specific voting	intentions	should	specific voting intentions should be fully
be fully disclosed to the shareholders being	disclosed to the shareholders being solicited.,
solicited. Soliciting voting rights from the	shareholders holding more than 1% of
shareholders with compensation or disguised	the voting shares or investor protection
compensation is prohibited. The Company	institutions	established	in accordance
must not set a lowest shareholding percentage	with laws, administrative regulations or
when soliciting the shareholder voting rights.	the provisions of the securities regulatory
						authority under the State Council
						(hereinafter referred to as "Investor
						Protection Institutions") may act as proxy
						solicitors and, by themselves or through
						their appointed securities companies or
						securities	service	institutions, publicly
						invite the shareholders of the listed
						company to entrust it to attend the
						general meetings and exercise the rights of
						shareholders, such as to propose and vote
						on resolutions, on their behalf.
						If the rights of shareholders are solicited in
						accordance with the preceding paragraph,
						the solicitors shall disclose the solicitation
						documents and the Company shall
						cooperate.
						Soliciting voting rights from the
						shareholders with compensation or disguised
						compensation is prohibited. The Company
						must not set a lowest shareholding percentage
						when soliciting the shareholder voting rights.
						If any public solicitation of shareholders'
						rights violates	laws,	administrative
						regulations or relevant provisions of the
						securities regulatory authority under the
						State Council, thus causing the Company
						or its shareholders to suffer losses, the
						solicitors shall be liable for compensation
						according to laws.

- 8 -

LETTER FROM THE BOARD

					Proposed Amendments to
Existing Terms of Articles of Association		Articles of Association

When	considering	related	transactions	When	considering related	transactions
during the general meeting, the related	during the general meeting, the related
shareholders must not participate in the	shareholders must not participate in the
voting, and the number of shares with voting	voting, and the number of shares with voting
rights represented by him/her shall not be	rights represented by him/her shall not be
included in the total number of valid votes.	included in the total number of valid votes.
The announcement on the resolutions shall	The announcement on the resolutions shall
fully disclose the voting of the non-related	fully disclose the voting of the non-related
shareholders.			shareholders.
Voting at the general meeting shall be	Voting at the general meeting shall be
conducted by poll with registration.	conducted by poll with registration.
Pursuant to the applicable laws and	Pursuant to the applicable laws and
regulations and the Listing Rules of the stock	regulations and the Listing Rules of the stock
exchange on which the Company's shares are	exchange on which the Company's shares are
listed, whereas any shareholder is required	listed, whereas any shareholder is required
to abstain from voting on any particular	to abstain from voting on any particular
resolution or restricted to voting only for or	resolution or restricted to voting only for or
against any particular resolution, any vote	against any particular resolution, any vote
cast by or on behalf	of such	shareholder	cast by	or on behalf of such	shareholder
in contravention of such requirement or	in contravention of such requirement or
restriction shall not be tallied.		restriction shall not be tallied.

Article 128The Company sets a Board,	Article 128The Company sets a Board,
which	comprises 12	directors, including	which comprises 1214directors, including

one chairman, one vice chairman and four	one chairman, one vice chairman and fourfive
independent non-executive directors.	independent non-executive directors.
Independent non-executive directors may	Independent non-executive directors may
directly report to the general meeting, CSRC	directly report to the general meeting, CSRC
and other relevant regulatory authorities.	and other relevant regulatory authorities.

Article 179The financial statements of the	Article 179The financial statements of the
Company shall be prepared in accordance	Company shall be prepared in accordance
with the PRC accounting standards and	with the PRC accounting standards and
regulations as well as the international	regulations as well as the international
accounting standards or the accounting	accounting standards orthe accounting
standards of the overseas listing place. If	standards of the overseas listing place
the financial statements prepared under the	required under the rules of the places in
two accounting standards are discrepant	which	the Company's shares	are listed.
significantly, such discrepancy shall be	If the financial statements prepared under
explained in the notes to the financial	the two accounting standards are discrepant
statements. The Company shall distribute	significantly, such discrepancy shall be
the after-tax profit of the relevant fiscal year	explained in the notes to the financial
as per the less of the after-tax profits in the	statements. The Company shall distribute
aforesaid two financial statements.	the after-tax profit of the relevant fiscal year
				as per the less of the after-tax profits in the
				aforesaid two financial statements.

- 9 -

LETTER FROM THE BOARD

	Proposed Amendments to
Existing Terms of Articles of Association	Articles of Association

Article 180The interim results or financial	Article 180The interim results or financial
data announced or disclosed by the Company	data announced or disclosed by the Company
shall be prepared in accordance with the PRC	shall be prepared in accordance with the PRC
accounting standards and regulations as well	accounting standards and regulations as well
as the international accounting standards	as the international accounting standards
or the accounting standards of the overseas	orthe accounting standards of the overseas
listing place.	listing placerequired under the rules of the
	places in which the Company's shares are
	listed.

Save for the above amendments to the provisions, other provisions of the Articles of Association will remain unchanged. The proposed amendments to the Articles of Association are subject to the approval of the Shareholders at the EGM, and it is proposed at the 2020 Third Extraordinary General Meeting to authorise the Board and the Board to then authorise the operating management of the Company to handle relevant formalities such as the registration/filing of changes with relevant competent departments in respect of the amendments to the Articles of Association.

It is hereby proposed at the 2020 Third Extraordinary General Meeting for Shareholders' consideration and approval.

Proposed Amendments to the Procedural Rules of the General Meetings
In order to further optimize the internal management system of the Company, the Company amended the relevant contents of the Procedural Rules of the General Meetings of Red Star Macalline Group Corporation Ltd. in compliance with the laws and regulations of the PRC. The details of the amendments are as follows:

				Proposed Amendments to
Existing Terms of the Procedural Rules of			the Procedural Rules
		the General Meetings			of the General Meetings

Article 5	The general meeting shall be the	Article 5	The general meeting shall be the
authority of power of the Company and shall	authority of power of the Company and shall
exercise its functions and powers:	exercise its functions and powers:
(I)	To	decide the business operation	(I)	To	decide the business operation
	guideline and investment plan for the		guideline and investment plan for the
	Company;		Company;
(II)	To	elect and replace directors and	(II)	To	elect and replace directors and
	to decide on matters relating to		to decide on matters relating to
	remuneration of the directors;		remuneration of the directors;

- 10 -

LETTER FROM THE BOARD

					Proposed Amendments to
Existing Terms of the Procedural Rules of		the Procedural Rules
	the General Meetings			of the General Meetings

(III)	To elect and replace supervisors who	(III)	To elect and replace supervisors who
	are not the employee representative		are not the employee representative
	and to decide on matters relating to		and to decide on matters relating to
	remuneration of the supervisors;		remuneration of the supervisors;
(IV)	To examine and approve reports of the	(IV)	To examine and approve reports of the
	Board;				Board;
(V)	To examine and approve reports of the	(V)	To examine and approve reports of the
	Supervisory Committee;			Supervisory Committee;
(VI)	To examine and approve the annual	(VI)	To examine and approve the annual
	financial budgets and final accounting		financial budgets and final accounting
	plans of the Company;			plans of the Company;
(VII)	To examine and approve the	(VII)	To examine and approve the
	Company's profit distribution plan and		Company's profit distribution plan and
	loss recovery plan;			loss recovery plan;
(VIII)	To resolve on increase or decrease of	(VIII)	To resolve on increase or decrease of
	the registered capital of the Company;		the registered capital of the Company;
(IX)	To resolve on	the merger,	division,	(IX)	To resolve on	the merger,	division,
	d i s s o l u t i o n ,	l i q u i d a t i o n o r		d i s s o l u t i o n ,	l i q u i d a t i o n o r
	transformation of the Company;		transformation of the Company;
(X)	To resolve on the issuance of corporate	(X)	To resolve on the issuance of corporate
	bonds and other securities and the		bonds and other securities and the
	listing of the Company;			listing of the Company;
(XI)	To resolve on the appointment,	(XI)	To resolve on the appointment,
	removal or non-reappointment of		removal or non-reappointment of
	certified public accountants of the		certified public accountants of the
	Company;				Company;
(XII)	To amend the Articles of Association;	(XII)	To amend the Articles of Association;
(XIII)	To examine proposals made by	(XIII)	To examine proposals made by
	shareholders	severally or	jointly		shareholders	severally or	jointly
	representing more than 3% of the		representing more than 31% of the
	voting shares of the Company;		voting shares of the Company;

- 11 -

LETTER FROM THE BOARD

						Proposed Amendments to
Existing Terms of the Procedural Rules of		the Procedural Rules
	the General Meetings			of the General Meetings

(XIV) To examine the Company's purchase	(XIV) To examine the Company's purchase
or disposal of major assets	within	or disposal of major assets	within
one year or matters with the amount	one year or matters with the amount
guaranteed exceeding 30% of the total	guaranteed exceeding 30% of the total
assets of the Company;			assets of the Company;
(XV) To	resolve on	other	matters	which,	(XV) To	resolve on	other	matters	which,
in accordance with the laws,	in accordance with the laws,
administrative	regulations,	listing	administrative	regulations,	listing
rules of the stock exchange with which	rules of the stock exchange with which
the Company's shares are listed and	the Company's shares are listed and
the Articles of Association, shall be	the Articles of Association, shall be
approved by a general meeting.		approved by a general meeting.

Article 28At general meetings of the	Article 28At general meetings of the
Company, the Board, the Supervisory	Company, the Board, the Supervisory
Committee, and	shareholder(s) individually	Committee, and	shareholder(s) individually
or jointly holding more than 3% of the	or jointly holding more than 31% of the
Company's shares shall have the right to	Company's shares shall have the right to
propose motions to the Company. The	propose motions to the Company. The
content of a proposal shall be determined	content of a proposal shall be determined
by the general meeting, have definite topics	by the general meeting, have definite topics
and specific issues for resolution, and shall	and specific issues for resolution, and shall
comply with the provisions of the laws,	comply with the provisions of the laws,
regulations and the Articles of Association.	regulations and the Articles of Association.
Shareholder(s) individually or jointly holding	Shareholder(s) individually or jointly holding
more than 3% of the Company's shares	more than 31% of the Company's shares
may submit a	written provisional	motion	may submit a	written provisional	motion
to the convener 10 days before a general	to the convener 10 days before a general
meeting is convened; the convener shall	meeting is convened; the convener shall
issue a supplementary notice of general	issue a supplementary notice of general
meeting	within	two	days	after	receipt	meeting	within	two	days	after	receipt
of the said provisional motion, to notify	of the said provisional motion, to notify
other shareholders and to submit the said	other shareholders and to submit the said
provisional proposal to the general meeting	provisional proposal to the general meeting
for consideration.				for consideration.

- 12 -

LETTER FROM THE BOARD

Proposed Amendments to

Existing Terms of the Procedural Rules of

the Procedural Rules

the General Meetings

of the General Meetings

Except as provided in the preceding

paragraph,

after the

convener

issues a

paragraph,

after the

convener

issues a

notice of the general meeting, he/she shall

not change the proposals or add any new

proposals in the notice of the general

meeting.

Proposals not set out in the notice of general

meeting or not complying with the provision

herein shall not be voted on or resolved at the

general meeting.

Article 29While the Company elected

directors, supervisors who are not the

employee representative or midway changed

of directors, supervisors who are not the

employee representative, the Board, the

Supervisory

Committee,

and

shareholder(s)

Supervisory

Committee,

and

shareholder(s)

individually or jointly holding more than

individually

jointly

holding

than

3% of the Company's issued shares may

31% of the Company's issued shares may

nominate candidates

(excluding

candidates

nominate candidates

(excluding

candidates

for independent directors). The Board, the

Supervisory

Committee,

and

shareholder(s)

Supervisory

Committee,

and

shareholder(s)

individually or jointly holding more than

1% of the Company's issued shares may

nominate

candidates

for

independent

nominate

candidates

for

independent

directors. The aforesaid nominations shall be

submitted to the General Meeting for voting

by means of proposals. The nomination

committee shall make recommendations to

the Board on candidates for directors. The

Company shall publish the procedures for

shareholders to nominate candidates for

election as directors on its website.

Article 41When considering proposed

Article 41 When considering proposed

resolutions during the general meeting, the

related shareholders must not participate in

the voting, and the number of shares with

voting rights represented by him/her shall not

be included in the total number of valid votes

at the general meeting. The announcement on

the resolutions of the general meeting shall

fully disclose the voting of the non-related

shareholders. If any related shareholder is not

able to abstain himself/herself from voting

upon related transactions due to special

circumstances, the

Company

may, with

circumstances,

the

Company

may,

with

the approval of the competent authorities,

execute voting in a normal course and give a

detailed explanation in the announcement on

the resolutions of the general meeting.

- 13 -

LETTER FROM THE BOARD

						Proposed Amendments to
Existing Terms of the Procedural Rules of	the Procedural Rules
		the General Meetings		of the General Meetings

When material issues affecting the interests	When material issues affecting the interests
of small and medium investors are being	of small and medium investors are being
considered at the general meeting, the votes	considered at the general meeting, the votes
of such investors shall be counted separately.	of such investors shall be counted separately.
The separate counting results shall be	The separate counting results shall be
promptly and publicly disclosed.			promptly and publicly disclosed.
The Board, independent non-executive	The Board, independent non-executive
directors	and	shareholders who	satisfy	directors and shareholders who satisfy the
the	relevant	regulations	and	conditions	relevant regulations and conditions may
may	publicly	solicit voting	rights	from	publicly solicit voting rights from the
the shareholders. When soliciting voting	shareholders. When soliciting voting rights
rights from the shareholders, information	from the shareholders, information such as
such	as	specific voting	intentions	should	specific voting intentions should be fully
be fully disclosed to the shareholders being	disclosed to the shareholders being solicited.,
solicited. Soliciting voting rights from the	shareholders holding more than 1% of
shareholders with compensation or disguised	the voting shares or investor protection
compensation is prohibited. The Company	institutions	established	in accordance
must not set a lowest shareholding percentage	with laws, administrative regulations or
when soliciting the shareholder voting rights.	the provisions of the securities regulatory
						authority under the State Council
						(hereinafter referred to as "Investor
						Protection Institutions") may act as proxy
						solicitors and, by themselves or through
						their appointed securities companies or
						securities	service	institutions, publicly
						invite the shareholders of the listed
						company to entrust it to attend the
						general meetings and exercise the rights of
						shareholders, such as to propose and vote
						on resolutions, on their behalf.
						If the rights of shareholders are solicited in
						accordance with the preceding paragraph,
						the solicitors shall disclose the solicitation
						documents and the Company shall
						cooperate.
						Soliciting voting rights from the
						shareholders with compensation or disguised
						compensation is prohibited. The Company
						must not set a lowest shareholding percentage
						when soliciting the shareholder voting rights.
						If any public solicitation of shareholders'
						rights violates	laws,	administrative
						regulations or relevant provisions of the
						securities regulatory authority under the
						State Council, thus causing the Company
						or its shareholders to suffer losses, the
						solicitors shall be liable for compensation
						according to laws.

					- 14 -

LETTER FROM THE BOARD

Save for the above amendments to the provisions, other provisions of the Procedural Rules of the General Meetings will remain unchanged. The proposed amendments to the Procedural Rules of the General Meetings are subject to the approval of the Shareholders at the 2020 Third Extraordinary General Meeting.

It is hereby proposed at the 2020 Third Extraordinary General Meeting for Shareholders' consideration and approval.

Proposed Amendments to the Procedural Rules of the Board of Directors
In order to further optimize the internal management system of the Company, the Company amended the relevant contents of the Procedural Rules of the Board of Directors of Red Star Macalline Group Corporation Ltd. in compliance with the laws and regulations of the PRC. The details of the amendments are as follows:

						Proposed Amendments to
Existing Terms of the Procedural Rules of	the Procedural Rules
	the Board of Directors		of the Board of Directors

Article 3 The Company sets a Board,	Article 3The Company sets a Board,
which	comprises	12	directors, including	which comprises 1214directors, including
one chairman,	one	vice	chairman	and	one chairman, one vice chairman	and
four independent non-executive directors.	fourfiveindependent non-executive directors.
Independent non-executive directors must	Independent non-executive directors must
make up at least a third of the Board and must	make up at least a third of the Board and must
consist of at least three members.		consist of at least three members.

Article	10The	Board may	authorize	the	Article 10The Board may authorize	the
general manager (chief executive officer) or	general manager (chief executive officer)or
other institutions to exercise its functions and	other institutions to exercise its functions and
powers, and shall not delegate all its statutory	powers, and shall not delegate all its statutory
authorities (especially the functions and	authorities (especially the functions and
powers in respect of which shall be reported	powers in respect of which shall be reported
to the Board and the Board's approval is	to the Board and the Board's approval is
needed prior to making any decision or	needed prior to making any decision or
giving any undertaking on behalf of the	giving any undertaking on behalf of the
Company) permanently to other individuals	Company) permanently to other individuals
or institutions. If the Board is to authorize	or institutions. If the Board is to authorize
the general manager (chief executive officer)	the general manager (chief executive officer)
or other institutions of the Company to	or other institutions of the Company to
exercise its functions and powers, the Board's	exercise its functions and powers, the Board's
resolution on such authorization is needed.	resolution on such authorization is needed.

Article 17Before issuing the notice on	Article 17Before issuing the notice on
convening a regular Board meeting, the	convening a regular Board meeting, the
secretary of the Board shall fully consult all	secretary of the Board shall fully consult all
directors to initially form the proposal at the	directors to initially form the proposal at the
meeting and then submit it to the chairman	meeting and then submit it to the chairman
for approval. The chairman, if necessary,	for approval. The chairman, if necessary,
shall consult the general manager (chief	shall consult the general manager (chief
executive officer) or other senior executives	executive officer)or other senior executives
before finalizing the proposal.			before finalizing the proposal.

- 15 -

LETTER FROM THE BOARD

						Proposed Amendments to
Existing Terms of the Procedural Rules of			the Procedural Rules
	the Board of Directors		of the Board of Directors

Article 18In any of the following	Article 18In any of the following
circumstances, the Board shall convene an	circumstances, the Board shall convene an
extraordinary meeting:		extraordinary meeting:
(I)	When	the	shareholders	representing	(I)	When	the	shareholders	representing
	one-tenth or more of the voting rights		one-tenth or more of the voting rights
	propose;				propose;
(II)	When one-third or more of the directors	(II)	When one-third or more of the directors
	jointly propose;			jointly propose;
(III)	When	the	Supervisory	Committee	(III)	When	the	Supervisory	Committee
	proposes;				proposes;
(IV) When the chairman deems necessary;	(IV) When the chairman deems necessary;
(V)	When half or more of independent	(V) When	half	or more	of	independent
	directors propose;			directors propose;
(VI)	When the general manager (chief	(VI) When	the	general	manager (chief
	executive officer) proposes;			executive officer)proposes;
(VII) In any other circumstance so specified	(VII) In any other circumstance so specified
	in the Listing Rules and the Articles of		in the Listing Rules and the Articles of
	Association.				Association.

Article 25The meeting of the Board cannot	Article 25The meeting of the Board cannot
be convened unless more than half of the	be convened unless more than half of the
directors are present.		directors are present.
The supervisors, the general manager (chief	The supervisors, the general manager (chief
executive officer) and the secretary of the	executive officer)and the secretary of the
Board without a concurrent post of director	Board without a concurrent post of director
shall attend the Board meetings.		shall attend the Board meetings.
The meeting moderator, if he/she considers	The meeting moderator, if he/she considers
necessary, can inform other relevant	necessary, can inform other relevant
personnel to attend the meeting.		personnel to attend the meeting.

- 16 -

LETTER FROM THE BOARD

Proposed Amendments to

Existing Terms of the Procedural Rules of

the Procedural Rules

the Board of Directors

of the Board of Directors

Article

The

directors

should

Article

The

directors

should

independently and prudently give their

options upon carefully reading the relevant

meeting materials and fully understanding the

situations.

The directors are allowed to learn the

information necessary for the decision-

making from the Office of the Board, the

meeting convener, the general manager

(chief executive officer) and other senior

(chief executive officer)and other senior

executives,

various

special

committees,

executives,

various

special

committees,

accounting firms and law firms and other

relevant personnel and organizations before

the

meeting,

or to

suggest the

moderator

the

meeting,

or to

suggest the

moderator

to invite the above-mentioned persons and

the representatives of the above-mentioned

organizations to attend the meeting to explain

the situations.

Article 35

The directors shall avoid voting

Article 35

The directors shall avoid voting

on the relevant proposal in the following

circumstances:

(I) When

the Articles of Association and

(I) When

the Articles of Association and

the Rules for the Management of the

Party

Transactions

stipulate

Party

Transactions

stipulate

the directors should avoid voting due

to their relationship with the enterprise

involved by the meeting proposal;

(II)

When

the

directors deem

necessary to

(II)

When

the

directors deem

necessary to

avoid voting;

(III) When

the laws and regulations and

(III) When

the laws and regulations and

Listing Rules stipulate there is a

material interest relationship or other

situations.

circumstances.

- 17 -

LETTER FROM THE BOARD

LETTER FROM THE BOARD

Save for the above amendments to the provisions, other provisions of the Procedural Rules of the Board of Directors will remain unchanged. The proposed amendments to the Procedural Rules of the Board of Directors are subject to the approval of the Shareholders at the 2020 Third Extraordinary General Meeting.

It is hereby proposed at the 2020 Third Extraordinary General Meeting for Shareholders' consideration and approval.

3. THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

A notice of the EGM to be held at 2:00 p.m. on Friday, 11 September 2020 at Conference Center, 3/ F, South Building, Block B, Red Star Macalline Headquarters, Lane 1466, Shenchang Road, Minhang District, Shanghai, the PRC, is set out on pages 21 to 22 of this circular.

A proxy form to be used at the EGM is also enclosed herein and published on the website of the Stock Exchange (www.hkexnews.com.hk). H Share Shareholders who intend to appoint a proxy to attend the EGM shall complete, sign and return the proxy form in accordance with the instructions printed thereon.

For H Share Shareholders, the proxy form, and if the proxy form is signed by a person under a power of attorney or other authority on behalf of the appointor, a notarized copy of that power of attorney or other authority, must be delivered to the Company's H Share Registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, not less than 24 hours before the time for holding the EGM in order for such documents to be valid.

Pursuant to the Articles of Association, for the purpose of holding the EGM, the register of members of H Shares will be closed from Tuesday, 8 September 2020 to Friday, 11 September 2020 (both days inclusive), during this period no transfer of H Shares will be registered. H Share Shareholders whose names appear on the H Shares register of members of the Company on Tuesday, 8 September 2020 are entitled to attend and vote at the EGM.

- 19 -

LETTER FROM THE BOARD

In order to attend at the EGM, H Share Shareholders shall lodge all transfer documents together with the relevant share certificates to the Company's H Share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, not later than 4:30 p.m. on Monday, 7 September 2020.

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of Shareholders at a general meeting must be taken by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. Therefore, the resolutions proposed at the EGM will be voted by poll.

4. RECOMMENDATION

The Directors consider that all resolutions set out in the notice of EGM for consideration and approval by Shareholders are in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favour of all resolutions to be proposed at the EGM.

By order of the Board

Red Star Macalline Group Corporation Ltd.

GUO Binghe

Vice Chairman

- 20 -

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

Red Star Macalline Group Corporation Ltd.

紅星美凱龍家居集團股份有限公司

(A sino-foreign joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1528)

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the 2020 third extraordinary general meeting (the "EGM") of Red Star Macalline Group Corporation Ltd. (the "Company") will be held at 2:00 p.m. on Friday, 11 September 2020 at Conference Center, 3/F, South Building, Block B, Red Star Macalline Headquarters, Lane 1466, Shenchang Road, Minhang District, Shanghai, the People Republic of China (the "PRC") for the purpose of considering, and if thought fit, passing the following resolutions:

SPECIAL RESOLUTIONS

Resolution on the amendments to the Articles of Association of Red Star Macalline Group Corporation Ltd.;
Resolution on the amendments to the Procedural Rules of the General Meetings of Red Star Macalline Group Corporation Ltd.; and
Resolution on the amendments to the Procedural Rules of the Board of Directors of Red Star Macalline Group Corporation Ltd.

By order of the Board

Red Star Macalline Group Corporation Ltd.

GUO Binghe

Vice Chairman

Hong Kong

21 August 2020

- 21 -

NOTICE OF THE 2020 THIRD EXTRAORDINARY GENERAL MEETING

Notes:

Unless the context otherwise stated, capitalised terms used in this notice shall have the same meanings as those defined in the circular of the Company dated 21 August 2020.
For the purpose of holding the EGM, the register of members of the Company will be closed from Tuesday, 8 September 2020 to Friday, 11 September 2020 (both days inclusive), during which period no transfer of shares can be registered. In order for H Share Shareholders to be qualified to attend and vote at the EGM, all transfer documents accompanied by the relevant share certificates must be lodged with the H Share registrar of the Company, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, no later than 4:30 p.m. on Monday, 7 September 2020 for registration.
The Shareholders whose names appear on the register of members of the Company on Tuesday, 8 September 2020 after close of business are entitled to attend and vote at the EGM.
Shareholders who are entitled to attend and vote at the EGM may appoint one or more proxies to attend and vote on their behalves. A proxy need not be a Shareholder of the Company.
The instrument appointing a proxy must be in writing under the hand of a Shareholder or his attorney duly authorised in writing. If the Shareholder is a legal person, that instrument must be executed either under its seal or under the hand of its director or other attorney duly authorised to sign the same on its behalf.
In order to be valid, the proxy form must be deposited, for H Share Shareholders of the Company, to the H Share registrar of the Company, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong not less than 24 hours before the time for holding the EGM. If the proxy form is signed by a person under a power of attorney or other authority, a notarized copy of that power of attorney or other authority shall be deposited at the same time as mentioned in the proxy form. Completion and return of the proxy form will not preclude Shareholders from attending and voting in person at the EGM or any adjourned meetings should they so wish.
Shareholders shall produce their identification documents and supporting documents in respect of the shares of the Company held when attending the EGM. If corporate Shareholders appoint authorised representative to attend the EGM, the authorised representative shall produce his/her identification documents and a notarized copy of the relevant authorisation instrument signed by the board of directors or other authorised parties of the corporate Shareholders or other notarized documents allowed by the Company. Proxies shall produce their identification documents and the proxy form signed by the Shareholders or their attorney when attending the EGM.
The EGM is expected to take for less than half a day. Shareholders attending the EGM shall be responsible for their own travel and accommodation expenses.
All voting at the EGM will be conducted by poll.

- 22 -

Company analysis