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TA YANG GROUP HOLDINGS LIMITED 大 洋 集 團 控 股 有 限 公 司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1991)
CLARIFICATION ANNOUNCEMENT
MAJOR TRANSACTION
IN RELATION TO ENTERING INTO OF
COOPERATION AGREEMENT
Reference is made to the announcements of the Company dated 8 October 2018 in relation to entering into of the Cooperation Agreement (the ''Previous Announcement''). Terms used herein have the same meanings as those defined in the Previous Announcement unless the context requires otherwise.
As stated in the sub-paragraph number (3) in the paragraph headed ''The capital contributions to the Joint Venture by the Parties'' of the Previous Announcement, the operation period of the Joint Venture shall be ten years, which may be extended or shortened by resolution of the general meeting of the Joint Venture. In the event that the accumulative return on net assets of the Joint Venture fails to reach 24% for three consecutive years, Party A shall be entitled to choose to exit the investment while Party B and Party C shall be obliged to take up the equity interests transferred by Party A at a price no less than the valuation of the equity interests held by Party A (the valuation reference date shall be determined based on the point of exit) and the paid-in capital contribution by Party
A×(1+8%) (the number of days that Party A fully paid the capital contribution/365).
The Board would like to clarify that as stated in the said sub-paragraph number (3), while failing to meet the condition thereunder, the Company shall be obliged to take up the equity interests transferred by Party A. It constitutes an option to acquire assets as defined in Rules 14.04(1)(b) and 14.72 of the Listing Rules while the Company has no discretion in the asset acquisition option. Therefore, the total consideration must comprise capital contribution amount of Tayang Tongchuang and the consideration of the asset acquisition option. As a result, as one of the applicable percentage ratios in respect of the entering into of the Cooperation Agreement as calculated under Rule 14.07 of the Listing Rules exceeds 25% and all applicable ratios are less than 100%, the entering into of the Cooperation Agreement constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and is subject to the reporting, announcement and shareholders' approval requirements. To the bestof the Directors' knowledge and information, and having made all reasonable enquiries, no Shareholder has any material interest in the entering into of the Cooperation Agreement. As such, no Shareholder is required to abstain from voting if a general meeting of the Company were convened to approve the entering into of the Cooperation Agreement. The Company intends to obtain a written approval from Lyton Maison Limited, the controlling Shareholder holding 436,540,400 Shares with voting rights (representing approximately 50.11% of the 871,178,000 Shares with voting rights in issue as at the date of this announcement), in respect of the entering into of the Cooperation Agreement. Pursuant to Rule 14.44 of the Listing Rules, such written approval from Lyton Maison Limited can be accepted in lieu of holding a general meeting for the purpose of approving the entering into of the Cooperation Agreement.
GENERAL
A circular containing information required under the Listing Rules should be despatched to the Shareholders on or before 30 October 2018 pursuant to Rule 14.41(a) of the Listing Rules. As more time is required to finalize certain information for inclusion in the circular, the Company will apply to the Stock Exchange for a waiver in connection with the Rule 14.41(a) of the Listing Rules for the delay in despatch of the circular.
By order of the Board
Ta Yang Group Holdings Limited
Shi Qi
Chairlady and Chief Executive Officer
Hong Kong, 19 October 2018
As at the date of this announcement, the Board comprises three executive Directors, namely Ms. Shi Qi, Mr. Qiu Yonghao and Mr. Zhao Ang; three non-executive Directors, namely Mr. Gao Feng, Mr. Han Lei and Mr. Sze Wai Lun; and three independent non-executive Directors, namely Ms. Zhang Lijuan, Mr. Pak Wai Keung, Martin and Mr. Wu Tak Kong.