Q TECHNOLOGY (GROUP) COMPANY LIMITED

Transcription

1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. Q TECHNOLOGY (GROUP) COMPANY LIMITED (Incorporated in the Cayman Islands with limited liability) (Stock Code: 1478) DISCLOSEABLE TRANSACTION PARTICIPATING IN THE PRIVATE PLACEMENT OF NEWMAX TECHNOLOGY CO., LTD. THE SHARE SUBSCRIPTION AGREEMENT The Board is pleased to announce that on 18 March 2017, the Company entered into the Share Subscription Agreement with the Target Company, a company listed on the Taipei Exchange (stock code: 3630), pursuant to which the Target Company has conditionally agreed to issue, and the Company has conditionally agreed to subscribe for, the Placing Shares, representing approximately 36.0% of the entire issued ordinary shares of the Target Company as enlarged upon completion of the Private Placement (assuming that no other shares of the Target Company will be issued prior to the completion of the Private Placement). LISTING RULES IMPLICATIONS As one of the applicable percentage ratios under Rule of the Listing Rules in respect of the entering into of the Share Subscription Agreement and the Private Placement contemplated thereunder is 5% or more but is less than 25%, the entering into of the Share Subscription Agreement constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules, and is subject to the reporting and announcement requirements but is exempted from shareholders approval requirements under Chapter 14 of the Listing Rules. GENERAL None of the Directors are considered to be interested in the Private Placement as contemplated under the Share Subscription Agreement. Therefore, none of the Directors is required to abstain from voting at the Board meeting approving the entering into of the Share Subscription Agreement. 1

2 Completion of the Private Placement is subject to fulfillment of the conditions precedent set out in the Share Subscription Agreement, and the Share Subscription Agreement may or may not proceed to the Completion. The shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company. Reference is made to the announcement of the Company dated 22 February The Board is pleased to announce that on 18 March 2017, the Company entered into the Share Subscription Agreement with the Target Company, a company listed on the Taipei Exchange (stock code: 3630), pursuant to which the Target Company has conditionally agreed to issue, and the Company has conditionally agreed to subscribe for, the Placing Shares, representing approximately 36.0% of the entire issued ordinary shares of the Target Company as enlarged upon completion of the Private Placement (assuming that no other shares of the Target Company will be issued prior to the completion of the Private Placement). THE SHARE SUBSCRIPTION AGREEMENT Date : 18 March 2017 The Parties : (i) the Company; and (ii) the Target Company. To the best of the knowledge, information and belief of the Directors after having made all reasonable enquiries, the Target Company and its ultimate beneficial owners are third parties independent of the Company and connected persons of the Company. Consideration The provisional placing price (the Provisional Placing Price ) payable by the Company or its designated subsidiary to the Target Company in relation to the Private Placement will be TWD21.88 (equivalent to approximately RMB4.69) per Placing Share, representing a total consideration of approximately TWD1,247,354,469 (equivalent to approximately RMB282,846,818), which shall be adjusted taking into consideration of the Referenced Placing Price (as defined below). The Provisional Placing Price was determined with reference to a discount to the closing price and represents approximately 47.2% of the five days average closing price of the Target Company on the Taipei Exchange prior to the date of the Share Subscription Agreement, or approximately 52.8% discount to the five days average closing price of the Target Company on the Taipei Exchange prior to the date of the Share Subscription Agreement. The final placing price for the Placing Shares is subject to the approval from the shareholders of the Target Company and will be determined in accordance with the relevant rules in Taiwan which shall be the higher of: (i) the simple average closing price of the Target Company s shares as stated on the Taipei Exchange for either the preceding one, three or five business day(s) before the date of board meeting for approving the Private Placement, after adjustment for any distribution of stock dividends, cash dividends or capital reduction; or 2

3 (ii) the simple average closing price of the Target Company s shares as stated on the Taipei Exchange for the preceding 30 business days before the date of board meeting for approving the Private Placement, after adjustment for any distribution of stock dividends, cash dividends or capital reduction, (hereinafter, the Referenced Placing Price ). The final placing price for the Placing Shares shall in no event be lower than 40% of the Referenced Placing Price or more than the Provisional Placing Price. Should the final placing price determined by the shareholders of the Target Company be higher than the Provisional Placing Price, the Company has no obligation to proceed with the Completion and the Share Subscription Agreement may be terminated with immediate effect with no further obligation on the part of the Company. Conditions precedent Completion of the Private Placement is conditional upon the fulfillment or waiver (as the case may be) of the following conditions: Conditions precedent to be fulfilled by the Target Company (a) the shareholders of the Target Company having approved the allotment of the Placing Shares via the Private Placement and having determined the final placing price and the Referenced Placing Price pursuant to the terms of the Share Subscription Agreement; (b) the Target Company having performed its obligations pursuant to the terms of the Share Subscription Agreement on or before the Completion Date; (c) (d) (e) (f) (g) the representations and warranties of the Target Company under the Share Subscription Agreement having remained true and accurate as at the date of the Share Subscription Agreement and the Completion Date, and/or as at the relevant dates based on the nature of the relevant representations and warranties; the information provided by the Target Company to the Company for the purposes of the due diligence review against the Target Group in respect of, inter alia, the financial performance, business, human resources and legal status of the Target Group, remains true and accurate as at the Completion Date in all material respects. The term material refers to events having consequences of TWD10 million or above; the Board having approved the final placing price as determined by the shareholders of the Target Company pursuant to the Share Subscription Agreement; the Target Company having obtained all necessary consents and approvals from relevant governmental and regulatory authorities (including but not limited to the Taipei Exchange and any other autonomous institutions and groups) in respect of the Private Placement pursuant to the Share Subscription Agreement; the Company having obtained all necessary consents and approvals in respect of its participation in the Private Placement pursuant to the Share Subscription Agreement; 3

4 (h) (i) (j) (k) (l) the Company having satisfied all applicable requirements under the Listing Rules and other regulatory authorities, including but not limited to, if applicable, obtaining the requisite shareholders approval; there being no injunction, judgement, court orders or other restrictions from the courts in any jurisdictions which prohibit the parties from completing the Private Placement as at the date of the Share Subscription Agreement and the Completion Date; the Target Company not having encountered any event which materially and adversely affect its ordinary course of business as at the date of the Share Subscription Agreement and the Completion Date; any other conditions precedent which are required for the purpose of completing the Private Placement pursuant to all applicable laws and regulations; and any other conditions precedent to be subsequently agreed by the Company and the Target Company in writing. The Company may, in its absolute discretion, waive the conditions precedent set out above (except conditions (a), (e), (f), (g) and (k)). If any of the above conditions precedent is not satisfied by the Target Company or, to the extent permitted, waived by the Company in writing on or before the Long Stop Date, the Company has no obligation to proceed with the Completion. Conditions precedent to be fulfilled by the Company (a) (b) the representations and warranties of the Company under the Share Subscription Agreement having remained true and accurate as at the date of the Share Subscription Agreement and the Completion Date; and the Company having performed its obligations pursuant to the terms of the Share Subscription Agreement on the Completion Date. The Target Company may, in its absolute discretion, waive the conditions precedent set out above. If any of the above conditions precedent is not satisfied by the Company or, to the extent permitted, waived by the Target Company in writing on or before the Long Stop Date, the Target Company has no obligation to proceed with the Completion. Board Composition and Board Meeting Pursuant to the Share Subscription Agreement, the Target Company has agreed to convene a shareholder meeting within two months after the Completion to approve (i) the re-election of the board of directors of the Target Company which should have seven directors, two of whom are independent directors; and (ii) to the extent permitted by applicable laws, the appointment of three directors nominated by the Company to the board of directors of the Target Company. The board of directors of the Target Company shall be convened on a quarterly basis and at any other time as required by the applicable laws and the articles of association of the Target Company. 4

5 Completion Subject to all the conditions precedent to the Private Placement as set forth in the paragraph headed Conditions Precedent above being satisfied or, to the extent permitted, waived by the other party, completion shall take place within seven business day after the date on which the Investment Commission of the Ministry of Economic Affairs of Taiwanhaving approved the Private Placement, or such other later date as the parties may otherwise agree in writing (the Completion Date ). If any of the parties to the Share Subscription Agreement fail to satisfy or, to the extent permitted, obtain waiver of the conditions precedent to the Private Placement as set forth above, defaulting party shall compensate for all the costs and expenses incurred by non-defaulting party, which compensation shall be no more than TWD3 million. REASONS AND BENEFITS FOR THE PRIVATE PLACEMENT The Directors believe that participating in the Private Placement is in the interests of the Company and its shareholders as a whole for the following reasons: (a) (b) (c) To coincide with the business strategy of the Group: The Group is dedicated to providing machine vision and human vision to mobile terminals by means of continuously building up capabilities of optics, computing vision and deep learning. Participating in the Private Placement coincides with the Group s business strategy, especially to enhance its capabilities on optical designs, as the Target Group has been engaging in the design, research and manufacture of optical lens for years and has acquired sufficient know-hows and developed various patented technologies in respect of optical lens. The Target Group is also one of the few manufacturers having the ability on the mass production of lens used for 13M module; To help the Group to earn international branded customers: The Group s existing customer portfolio consists primarily of Chinese brands. As the Target Group maintains years of working relationships with a number of international branded customers, participating in the Private Placement can help the Group promote its business to these international branded customers; and To expand the Group s product offerings to new market segments: The Group s current product portfolio consists primarily of camera modules and fingerprint recognition modules used for mobile phones, and the Group is actively expanding its product offerings to new market segments, such as augmented reality (AR), virtual reality (VR) and automobile. As the Target Group has been collaborating with a number of brands on lens that are used for motion sensing games, and has developed the relevant knowledge and technologies on lens that are used for automobile for years, participating in the Private Placement can help the Group expand its product offerings. The Directors (including the independent non-executive Directors) consider that the Private Placement was made on normal commercial terms, and the terms of the Share Subscription Agreement are fair and reasonable and in the interests of the Company and its shareholders as a whole. 5

6 INFORMATION ON THE TARGET GROUP The Target Company is a company established in Taiwan with limited liability, whose shares are listed on the Taipei Exchange (stock code: 3630). The Target Group is principally engaged in the design, research, development, manufacture and sales of optical lens. Set out below is certain audited financial information of the Target Group: For the year ended 31 December 2014 For the year ended 31 December 2015 For the year ended 31 December 2016 RMB 000 RMB 000 RMB 000 Revenue 368, , ,134 Profit before taxation (91,534) (161,108) (122,900) As at As at As at 31 December 31 December 31 December RMB 000 RMB 000 RMB 000 Net assets 685, , ,808 INFORMATION ON THE GROUP The Group is primarily engaged in the design, research, development, manufacture and sales of camera modules and fingerprint recognition modules with a focus on mid-to-high end camera and fingerprint recognition modules market for Chinese branded smart phone and tablet personal computer manufacturers. LISTING RULES IMPLICATIONS As one of the applicable percentage ratios under Rule of the Listing Rules in respect of the entering into of the Share Subscription Agreement and the Private Placement contemplated thereunder is 5% or more but is less than 25%, the entering into of the Share Subscription Agreement constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules, and is subject to the reporting and announcement requirements but is exempted from shareholders approval requirements under Chapter 14 of the Listing Rules. 6

7 GENERAL None of the Directors are considered to be interested in the Private Placement as contemplated under the Share Subscription Agreement. Therefore, none of the Directors is required to abstain from voting at the Board meeting approving the entering into of the Share Subscription Agreement. Completion of the Private Placement is subject to fulfillment of the conditions precedent set out in the Share Subscription Agreement, and the Share Subscription Agreement may or may not proceed to the Completion. The shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company. DEFINITIONS In this announcement, unless the context otherwise requires, the following terms shall have the following meanings: Board Company Completion Completion Date connected person Director(s) Group HK$ Hong Kong Listing Rules the board of Directors Q Technology (Group) Company Limited, a company incorporated in the Cayman Islands, whose shares are listed on the main board of the Stock Exchange completion of the Private Placement in accordance with the Share Subscription Agreement has the meaning ascribed to it under the paragraph headed Completion in this announcement has the meaning ascribed to it under the Listing Rules the director(s) of the Company the Company and its subsidiaries Hong Kong dollar, the lawful currency of Hong Kong the Hong Kong Special Administrative Region of the PRC the Rules Governing the Listing of Securities on the Stock Exchange Long Stop Date 31 December 2017 Target Company Target Group Newmax Technology Co., Ltd., a company established in Taiwan with limited liabilities, whose shares are listed on the Taipei Exchange (Stock code: 3630) the Target Company and its subsidiaries 7

8 TWD PRC Placing Shares Private Placement RMB Share Subscription Agreement Stock Exchange New Taiwan dollars, the lawful currency of Taiwan the People s Republic of China and for the purpose of this announcement, exclude Hong Kong, Taiwan and the Macau 57,008,888 new ordinary shares of the Target Company, representing approximately 36.0% of the entire issued ordinary shares of the Target Company as enlarged upon the completion of the Private Placement (assuming that no other shares of the Target Company will be issued prior to the completion of the Private Placement) the subscription by the Company or its designated subsidiary of the Placing Shares to be issued and allotted by the Target Company by way of private placement pursuant to the Share Subscription Agreement Renminbi, the lawful currency of the PRC the agreement dated 18 March 2017 and entered into between the Company and the Target Company with respect to the Private Placement The Stock Exchange of Hong Kong Limited For illustration purposes, amounts in TWD in this announcement have been translated into RMB at RMB1.00 = TWD4.41. Hong Kong, 19 March 2017 By order of the Board of Q Technology (Group) Company Limited He Ningning Chairman and Executive Director As at the date of this announcement, the executive Directors are Mr. He Ningning (Chairman), Mr. Wang Jianqiang (Chief Executive Officer) and Mr. Hu Sanmu; and the independent non-executive Directors are Mr. Chu Chia-Hsiang, Ms. Chen Jun and Mr. Ng Sui Yin. 8