REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Group is principally engaged in the research and development, manufacturing and trading of automobiles, automobile parts and related automobile components, and investment holding. The Geely Holding Group is principally engaged in the sales of automobiles and related parts and components wholesale and retail business. The Existing CBU Agreement has continued to strengthen the business relationship between the Group and the Geely Holding Group. For many years, the Geely Holding Group has recognized the Group as a reliable supplier of products to meet the needs of its business, while the Group has managed to expand its sales coverage through the better distribution network of the Geely Holding Group in Taizhou, Zhejiang Province, the PRC. The Directors believe that the continuation of the Existing CBU Agreement is essential in maintaining and further developing the mutually beneficial relationship between the Group and the Geely Holding Group. Given that (i) Geely Holding has better distribution channels in Taizhou, Zhejiang Province, the PRC; and (ii) the price for the sales of CBUs to the Geely Holding Group under the New CBU Agreement will not be less than the price offered to independent third party distributors (please refer to the sub- section headed “Pricing policy” above for details on the Group’s internal control mechanism to ensure this pricing principle), the Directors consider that it is in the interest of the Company to continue to sell the CBUs to the Geely Holding Group as it would ensure a stable demand for the Company’s products. The Directors (including the independent non-executive Directors) are of the view that the terms of the New CBU Agreement, including the Annual Caps are fair and reasonable and the Continuing Connected Transactions contemplated under the New CBU Agreement are in the ordinary and usual course of business of the Group and in the interests of the Company and the Shareholders as a whole. LISTING RULES IMPLICATIONS Geely Holding is a connected person of the Company for the purpose of the Listing Rules by virtue of the fact that Geely Holding is beneficially wholly-owned by Xx. Xx and his associates. As such, Geely Holding is an associate of Xx. Xx, an executive Director and a substantial Shareholder holding approximately 42.72% of the total issued share capital of the Company as at the date of this announcement. Accordingly, the New CBU Agreement constitutes continuing connected transactions for the Company pursuant t...
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Group has consistently applied conservative treasury policies in its cash and financial management. Since the global financial crisis in 2008, the returns available on surplus liquidity have been low. In reviewing the Group’s investment and treasury strategy, the possibility of investing in longer dated instruments, particularly corporate bonds of good quality is considered. The Directors consider it prudent and in the interests of the Company and the Shareholders as a whole to continue to have the flexibility of being able to invest in debt securities issued by corporations which may be classified as connected persons of the Company, as among other things, the Directors are more familiar with the business, management and credit standing of such companies than they would normally be for arm’s length companies. With a view to maintaining an appropriately balanced portfolio of financial investments and be consistent with its conservative treasury policies in its cash and financial management, certain protections and limitations are proposed in the terms of the Master Agreement with a view to setting a sound framework for a liquidity investment policy applicable to Connected Debt Securities which may be acquired during the Term, which should improve the Group’s returns while keeping increased risks within prudent limits. Xxxxxxxx has been appointed as the Independent Financial Adviser to advise the Board on the terms of the Master Agreement. The Board (including the Independent Non-executive Directors) and the Independent Financial Adviser consider the terms of the Master Agreement to be fair and reasonable and in the interests of the Company and the Shareholders as a whole.
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Company and its subsidiaries are principally engaged in asset management, as well as property development and property investment. Each of the VPHK Parties is principally engaged in property development and property investment. The Management Team is well established and has accumulated valuable asset management, property development and investment competencies and experience, as well as familiarity with the relevant operating environments and strong capability for assets management skills, in the property markets in the US, the United Kingdom and Hong Kong. Since the entering into of the Existing Management Service Framework Agreement, the VOI Parties, have been engaged in several management projects owned by the VPHK Parties or their associates and the VOI Parties and the VPHK Parties have built a solid and effective working relationship and the Management Team has become over time familiar with the management, business, operation of the projects owned by the VPHK Parties or their associates, as well as the standard of the management services required by them. The VOI Parties can leverage this established relationship and experience gained to render management services to the VPHK Parties and their associates in a more efficient and expedient manner, thereby reducing the Group’s aggregate operational and administrative costs while improving the profitability and the leading position of the Group in the property development and property investment industry. Given the historical and future long-term cooperation between the Group and the VPHK Parties and their associates, the transactions contemplated under the New Management Services Framework Agreement will enable the Group to generate stable income with growth prospects and investment return to its Shareholders. The major pricing policies, principal terms and indicators set out in the New Management Services Framework Agreement also provide a fair and reasonable basis for the parties to determine the management fee without lengthy negotiations and incurring substantial time and costs for different projects in the future. Furthermore, the consortium formed by VPHK and a real estate company CNQC International Holdings Limited (the consortium being an associate of VPHK) has recently been awarded the tender for the Tai Po Land, which has a site area of about 22,608 square metres and is designated for private residential purpose, on a 50-year land grant, by the Hong Kong Government. In anticipation of the...
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Master Internet TV Cooperation Agreement will enable the Group to leverage on the advantage of the exclusive content available from GoLive. With the expected potential development in the business of internet TVs and cinemas, it is expected that the Group would be able to create an extra source of income using the TCL Corporation Group’s established network without incurring substantial additional overheads. The Group will be able to continue to benefit through customer usage of the Group’s Internet-enabled Products in order to secure reliable source of high quality services of GoLive. With the software support from GoLive, it is also expected that the Group would be able to develop the Group’s business in the production and sale of its Internet-enabled Products. The Directors (including the independent non-executive Directors) consider that the terms of the Master Internet TV Cooperation Agreement and the transactions contemplated thereunder are fair and reasonable, and it is in the interests of the Company and the Shareholders as a whole to enter into the Master Internet TV Cooperation Agreement with GoLive. LISTING RULES IMPLICATIONS TCL Corporation, the ultimate controlling Shareholder of the Company, currently holds approximately 64.32% of the issued share capital of the Company, and is a connected person of the Company under the Listing Rules. GoLive, being an indirect non-wholly owned Subsidiary of TCL Corporation, is an associate of TCL Corporation and thus a connected person of the Company under the Listing Rules. The transactions contemplated under the Master Internet TV Cooperation Agreement therefore constitute continuing connected transactions under Chapter 14A of the Listing Rules. Notwithstanding the respective interests of certain Directors in TCL Corporation, none of them is considered as having a material interest in the transactions contemplated under the Master Internet TV Cooperation Agreement. Therefore, all Directors are entitled to vote pursuant to the Company’s articles of association. As one or more of the applicable percentage ratios (other than the profits ratio) calculated with reference to the respective annual caps of Master Internet TV Cooperation Agreement exceed 0.1% but all are less than 5%, the continuing connected transactions thereunder are exempted from independent Shareholders’ approval requirement under Rule 14A.76(2)(a) but are subject to reporting, announcement and annual review requirements under Chapter 14A o...
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Composite Services under the Third Renewal Framework Agreement are necessary for the normal day to day operations of the respective power plants and offices of the Employers. The repair and maintenance services required for the power plants are highly-technical in nature and can only be carried out by engineers and technicians equipped with the relevant technical skills and specialized knowledge. The Service Providers not only have the relevant technical expertise but also specific in-depth knowledge of the power generating units and related power generation facilities of the Company’s relevant power plants. Since the Service Providers are all conveniently located in close proximity to the relevant power plants and offices of the Employers, entrusting them to provide the required services is relatively cheaper than our anticipated operating costs for self-running. As such, entering into the Third Renewal Framework Agreement can further save the Group’s operating costs and will ensure the Employers to receive continual reliable services, and facilitate their safe, effective and efficient operations. Directors (including the independent non-executive Directors) are of the view that as far as the shareholders of the Company are concerned, the Third Renewal Framework Agreement has been renewed in the ordinary course of the Company’s business, on normal commercial terms or better, fair and reasonable and in the interests of the Company and its shareholders as a whole. None of the Directors has material interest in the transactions contemplated under the Third Renewal Framework Agreement and therefore no Director has abstained from voting on the related Board resolution.
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Company believes that the risk profile of Sinochem Finance, as a provider of financial services to the Group, is not greater than those of independent commercial banks in the PRC because:
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. The Directors consider that the terms of the aforesaid continuing connected transactions are fair and reasonable, on normal commercial terms or better, and it is in the interests of the Company and the Shareholders as a whole to enter the aforesaid continuing connected transactions for the following reasons:
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. A stable supply of Concrete is important to the Group’s construction projects. The Concrete products that are offered by Xxx Xxx are mainly mixed concrete products of a comprehensive range. The Directors consider that by entering into the Framework Agreement, the Group will continue to be able to secure a steady and reliable supply of Concrete at prices no less favourable than those from other independent third parties. The terms of the Framework Agreement were arrived at after arm’s length negotiations between the parties. The Directors (excluding the Independent Non-executive Directors whose opinion will be given after receiving advice from the Independent Financial Adviser) are of the view that the terms of the Framework Agreement are on normal commercial terms or better and in the ordinary and usual course of business of the Group, and that the terms and the proposed annual caps set out above are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Pursuant to the bye-laws of the Company, where a company in which a Director and/or his associate(s) (which has the meaning ascribed to it under the Listing Rules) holds 5% or more is/are materially interested in a transaction, then that Director and/or his associate(s) shall also be deemed materially interested in such transaction and that Director shall not vote on any resolution of the Board approving any contract or arrangement or proposal concerning that transaction. On the date of the Board meeting approving the terms of and the proposed annual caps in relation to the transactions under the Framework Agreement, Mr. Xxx Xxx Xxx, Xxxxx (“Mr. Xxx”) held 185,557,078 shares (23.40%) in Xxx Xxx. Therefore, Mr. Xxx is deemed to have a material interest in the Framework Agreement and accordingly, he has abstained from voting in the Board resolution approving the terms of and the proposed annual caps in relation to the transactions under the Framework Agreement.
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. X. Xxxxxxx of the Construction and Installation Services Framework Agreement Andre Construction and Installation has long been engaged in services relating to construction and installation and has certain advantages in the field in terms of technological capability and efficiency. Before Andre Construction and Installation provided the relevant services, it had already been very familiar with the processing facilities and requirements of the Group. Entering into the New Construction and Installation Services Framework Agreement will enable the Group to reduce costs, improve the efficiency and manage the quality of services in a more effective manner, as compared with engaging other service providers.
REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS. As the Group is a midstream player in the smart display device market, the Group will from time to time receive commission projects from customers (including relevant member(s) of TCL Corp Group) for processing Raw Materials into Semi-Finished Materials and/or Finished Goods to be used in downstream end products. Further, the Group has set up a new production facility in Wuhan, the PRC, which could provide an annual production capacity of approximately 60 million units in 2019 and 120 million units from 2020 onwards after the expansion of production lines. With the increased production capacity, the Directors consider that the arrangement under the Master Processing Agreement will enable the Group to undertake more commission work from members of TCL Corp Group to promote the Group’s business as an original design manufacturer and enhance the efficient use of resources and utilisation of the expanded production capacity of the Group. This manufacturing mode of processing Raw Materials provided by customers enables the Group to drive down procurement costs and inventory management costs, this result in a higher gross profit margin as compared to that of selling LCD Modules manufactured by the Group. Accordingly, the Directors consider that the arrangement under the Master Processing Agreement provides the Group with a more profitable manufacturing mode which will create greater value to Shareholders and is therefore in the interest of the Company and the Shareholders as a whole. In view of the above, the Directors (including the independent non-executive Directors) consider that the pricing term for the Master Processing Agreement are fair and reasonable, and consider that the continuing connected transactions contemplated thereunder and the annual cap thereof are in the ordinary and usual course of business of the Company, on normal commercial terms, fair and reasonable and in the interest of the Company and the Shareholders as a whole.
