In the ordinary course of its business, the Group conducts certain transactions with BOCHK Group pursuant to the Services and Relationship Agreement. Upon BOCHK Holdings
becoming a connected person of the Company in late November 2007, these ongoing
transactions constituted continuing connected transactions of the Company under the
Listing Rules. The Continuing Connected Transactions, comprising the General Connected
Transactions, the Investment Connected Transactions and the Inter-bank Connected
Transactions, continue following the expiration of the financial year ended December
31, 2007. The Company has assigned annual caps for each of the three financial years
ending December 31, 2010 (the “Annual Caps”) in respect of the Continuing Connected
Transactions.
Given that the Annual Caps in respect of the General Connected Transactions represent less than 2.5% of the applicable percentage ratios as defined in the Listing Rules, the General Connected Transactions fall within Rule 14A.34 of the Listing Rules, and are subject to the reporting and announcement requirements under Rules 14A.45 to 14A.47 and the annual review requirements under Rules 14A.37 and 14A.38 of the Listing Rules.
Given that the Annual Caps in respect of the Investment Connected Transactions and the
Inter-bank Connected Transactions represent more than 2.5% of the applicable percentage
ratios as defined in the Listing Rules, the Investment Connected Transactions and the
Inter-bank Connected Transactions constitute non-exempt Continuing Connected Transactions under Rule 14A.35 of the Listing Rules, and are subject to the reporting, announcement and independent shareholders’ approval requirements under Rules 14A.45 to 14A.48 and the annual review requirements under Rules 14A.37 and 14A.38 of the Listing Rules.
The Board has set up the Independent Board Committee to review and approve the Continuing Connected Transactions. The Company will retain an independent financial
adviser to advise the Independent Board Committee and the shareholders of the Company
for the purpose of considering the Investment Connected Transactions and the Inter-bank
Connected Transactions.
A circular containing, among other things, (i) details of the Investment Connected
Transactions and the Inter-bank Connected Transactions and the Annual Caps in respect
of the Investment Connected Transactions and the Inter-bank Connected Transactions;
(ii) a letter from the independent financial adviser to the Independent Board Committee
and the shareholders of the Company containing its advice on the Investment Connected
Transactions and the Inter-bank Connected Transactions; and (iii) the recommendation of the Independent Board Committee in respect of the Investment Connected Transactions and the Inter-bank Connected Transactions, will be despatched to the shareholders of the Company as soon as practicable. A notice of the AGM will be despatched to the shareholders of the Company separately.
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