THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Transcription

1 THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in any doubt as to any aspect of this circular, or as to the action to be taken, you should consult your stockbroker or other licensed securities dealer, bank manager, solicitor, professional accountant or other professional advisers. If you have sold or transferred all your shares in Consun Pharmaceutical Group Limited (the Company ), you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or transferee(s) or to the bank, stockbroker or licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s). 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. (Incorporated in the Cayman Islands with limited liability) (Stock code: 1681) GRANT OF SHARE OPTIONS AND NOTICE OF EXTRAORDINARY GENERAL MEETING The notice convening the extraordinary general meeting of the Company (the EGM ) to be held at Taishan Room, Level 5, Island Shangri-La, Hong Kong, Pacific Place, Supreme Court Road, Central, Hong Kong on Wednesday, 28 May 2014 at 10:30 a.m. or immediately after conclusion of the Company s annual general meeting to be held on the same day, whichever is later, is set out on pages 13 to 14 of this circular. Whether or not you are able to attend the EGM, you are requested to complete, sign and return the accompanying form of proxy in accordance with the instructions printed thereon to the Company s branch share registrar and transfer office in Hong Kong, 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 less than 48 hours before the time appointed for the holding of the EGM. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish. Hong Kong, 13 May 2014

2 CONTENTS Page DEFINITIONS LETTER FROM THE BOARD Introduction Grant of share options Shareholding structure Reasons for the Proposed Grant Mandate Limit on the Share Option Scheme EGM Voting by way of poll Responsibility statement Recommendation Miscellaneous NOTICE OF EGM i

3 DEFINITIONS In this circular, unless the context otherwise requires, the following expression have the following meanings: Articles of Association associates Board the articles of association of the Company as amended, modified or otherwise supplemental from time to time has the same meaning ascribed to it under the Listing Rules the board of Directors of the Company Company Consun Pharmaceutical Group Limited, a company incorporated under the laws of the Cayman Islands with limited liability with its Shares listed on the Stock Exchange connected person Controlling Shareholders has the same meaning ascribed to it under the Listing Rules has the meaning ascribed to it under the Listing Rules and unless the context requires otherwise, collectively refers to Central Success Developments Limited, Mr. AN Yubao, Guidoz Limited, Mr. YOUNG Wai Po, Peter, Double Grace International Limited and Ms. LI Qian Date of Grant 24 March 2014 Director(s) EGM Grantees Group Hong Kong Independent Shareholders director(s) of the Company the extraordinary general meeting of the Company to be convened and held at Taishan Room, Level 5, Island Shangri-La, Hong Kong, Pacific Place, Supreme Court Road, Central, Hong Kong, on Wednesday, 28 May 2014 at 10:30 a.m. or immediately after conclusion of the Company s annual general meeting to be held on the same day, whichever is later, a notice of which is set out on pages 13 to 14 of this circular certain Directors and employees of the Group the Company and its subsidiaries the Hong Kong Special Administrative Region of the PRC shareholders who are not connected to the Group under the Listing Rules 1

4 DEFINITIONS Latest Practicable Date Listing Date Listing Rules Options PRC Proposed Grant SFO Share(s) 5 May 2014, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein 19 December 2013, on which dealings in Shares first commenced on the Stock Exchange the Rules Governing the Listing of Securities on The Stock Exchange as amended, modified or otherwise supplemental from time to time share options to subscribe for Shares under the Share Option Scheme the People s Republic of China which shall, for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region and Taiwan the conditional grant of Options to Mr. AN Yubao and Ms. LI Qian to subscribe for 10,000,000 Shares and 10,000,000 Shares, respectively. the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong ordinary share(s) of HK$0.10 each in the share capital of the Company Share Option Scheme the share option scheme adopted by the Company on 2 December 2013 Shareholder(s) Stock Exchange substantial shareholder Takeovers Code HK$ holder(s) of Share(s) The Stock Exchange of Hong Kong Limited has the same meaning ascribed to it under the Listing Rules The Code on Takeovers and Mergers Hong Kong dollars, the lawful currency of Hong Kong % per cent 2

5 (Incorporated in the Cayman Islands with limited liability) (Stock code: 1681) Executive Directors Mr. AN Yubao (Chairman) Ms. LI Qian (Chief Executive Officer) Professor ZHU Quan Non-executive Directors Mr. YOUNG Wai Po, Peter Mr. WANG Shunlong Independent Non-executive Directors Mr. SU Yuanfu Mr. FENG Zhongshi Ms. CHENG Xinxin Registered office: Clifton House 75 Fort Street P.O. Box 1350 Grand Cayman KY Cayman Islands Headquarters in the PRC: 71, Dongpeng Avenue Eastern section, Guangzhou Economic and Technological Development District Guangzhou, PRC To the Shareholders Dear Sirs or Madam, GRANT OF SHARE OPTIONS AND NOTICE OF EXTRAORDINARY GENERAL MEETING INTRODUCTION Reference is made to the announcements of the Company dated 24 March 2014 and 13 May 2014 in relation to the proposed grant of the Options to, among others, each of Mr. AN Yubao ( Mr. AN ), Ms. LI Qian ( Ms. LI ) and Professor ZHU Quan ( Professor ZHU ). The purpose of this circular is to provide you with (i) information relating to the Proposed Grant; (ii) the recommendation of the Board, including all independent non-executive Directors, in relation to the Proposed Grant; and (iii) the notice of the EGM at which the Independent Shareholders shall be asked to consider and, if thought fit, approve the resolutions in respect of the Proposed Grant. GRANT OF SHARE OPTIONS On 24 March 2013, the Board resolved to grant in aggregate 60,000,000 Options to certain Directors and employees of the Group to subscribe for Shares under the Share Option Scheme, subject to acceptance of the Grantees. 3

6 Of the 60,000,000 Options granted, 10,000,000 Options were granted to Mr. AN Yubao ( Mr. AN ), the Chairman and a substantial shareholder of the Company, 10,000,000 Options were granted to Ms. LI Qian ( Ms. LI ), an executive Director, the chief executive officer and a substantial shareholder of the Company, and 3,000,000 Options were granted to Professor ZHU Quan ( Professor ZHU ), an executive Director of the Company. The remaining 37,000,000 Options were granted to 90 employees of the Company (other than Mr. AN, Ms. LI and Professor ZHU). The grant of Options to each of Mr. AN and Ms. LI is conditional upon Independent Shareholders approval to be obtained at the EGM. A summary of the grant of Options to Mr. AN and Ms. LI is set out below: Date of grant: 24 March 2014 Exercise price of Options granted: HK$6.64, which represents the higher of (i) the closing price of HK$6.64 per share as stated in the daily quotations sheet of the Stock Exchange on 24 March 2014; and (ii) the average closing price of HK$6.504 per Share as stated in the daily quotations sheets for five business days immediately preceding 24 March Number of Options granted: 10,000,000 Options to Mr. AN and 10,000,000 Options to Ms. LI Validity period and vesting conditions of the Options: Ten (10) years from 24 March 2014 to 23 March 2024 subject to the following conditions: In respect of Mr. AN: 10,000,000 Options may be exercised within a 3 years period: 30% of the 10,000,000 Options may be exercised on or after 24 March 2015; 30% of the 10,000,000 Options may be exercised on or after 24 March 2016; and 40% of the 10,000,000 Options may be exercised on or after 24 March

7 In respect of Ms. LI: 10,000,000 Options may be exercised within a 3 years period: 30% of the 10,000,000 Options may be exercised on or after 24 March 2015; 30% of the 10,000,000 Options may be exercised on or after 24 March 2016; and 40% of the 10,000,000 Options may be exercised on or after 24 March In addition to the vesting period set out above, the Options granted to each of Mr. AN and Ms. LI exercisable from 24 March 2015, 2016 and 2017 will only be vested fully if the audited net profit of the Group for each of the years ended 31 December 2014, 2015 and 2016 ( Actual Net Profit ) represents an annual compound growth rate of 20% or higher when compared with the audited net profit of the Group for the year ended 31 December 2013 ( Target Net Profit ). If the Actual Net Profit for the corresponding year is lower than the Target Net Profit of that year, the number of Options to be vested will be calculated according to the following formula: No. of Options to be vested = No. of Options exercisable for that year Target Net Profit of Actual Net Profit of the relevant year the relevant year x (1 2 x ( )) Target Net Profit of the relevant year If the Actual Net Profit for the corresponding year is lower than 80% of the Target Net Profit of that year, no Option will be vested to each of Mr. AN and Ms. LI for that year and the relevant Options granted will automatically lapse. The above targets are set as a basis for performance measurement under the Share Option Scheme only and do not represent the Board s projection or forecast of the Group s performance in the coming 3 years. The Board makes no representation on whether any of these targets can or may be achieved by the Group. 5

8 Other rights attaching to the Options Other than the right to subscribe for Shares, there is no voting, dividend, transfer or any other rights, including those arising on a liquidation of the Company, attaching to the securities and (if appropriate) any such rights attaching to the Options themselves. The Shares to be allotted upon the exercise of the Options shall rank pari passu in all respects with all other fully paid Shares in issue as at the date on which the new Shares are issued. Save as disclosed above, the Board confirms that none of the Grantees (other than Mr. AN, Ms. LI and Professor ZHU) is a Director, chief executive or substantial shareholder (as defined in the Listing Rules) of the Company or their associate (as defined in the Listing Rules). HK$1.00. The consideration payable on acceptance of the options by each of the Grantees is None of the Directors is a trustee of the Share Option Scheme or has a direct or indirect interest in the trustee of the Share Opiton Scheme. Pursuant to Rule (1) of the Listing Rules, the grant of Options by the Company to a Director, chief executive or substantial shareholder of the Company or any of their associates must be approved by the independent non-executive Directors (excluding independent non-executive Director who is the Grantee of the Options concerned). On 24 March 2014, the independent non-executive Directors approved the grant of Options to Mr. AN, Ms. LI and Professor ZHU. On 24 March 2014,the Remuneration Committee of the Company approved the grant of Options to Mr. AN, Ms. LI and Professor ZHU. 6

9 Further, pursuant to Rule 17.04(1) of the Listing Rules, where any grant of Options to a substantial shareholder or an independent non-executive Director of the Company, or any of their respective associates (as defined in the Listing Rules), would result in the Shares issued and to be issued upon exercise of all Options already granted and to be granted (including Options exercised, cancelled and outstanding) to such person in the 12-month period up to and including the date of such grant (i) representing in aggregate over 0.1% of the Shares in issue; and (ii) having an aggregate value, based on the closing price of the Shares at the date of each grant, in excess of HK$5,000,000, such grant of Options must be approved by the shareholders in a general meeting at which all connected persons of the Company must abstain from voting. The grant of Options to each of Mr. AN and Ms. LI (both being substantial shareholders) in the 12-month period up to and including the Date of Grant (i) representing in aggregate over 0.1% of the Shares in issue; and (ii) having an aggregate value, based on the closing price of the Shares at the Date of Grant, in excess of HK$5,000,000, falling within the ambit of Rule 17.04(1) of the Listing Rules. The grant of Options to each of Mr. AN and Ms. LI is therefore subject to Independent Shareholders approval. The grant of the Options to each of Mr. AN and Ms. LI is conditional upon Independent Shareholders approval to be obtained at the EGM. Since each of Mr. AN and Ms. LI and their respective associates are connected persons of the Company, each of them as well as all other connected persons of the Company shall abstain from voting on the resolutions approving the grant of Options. To the extent that it is aware by the Board having made all reasonable enquires, the following Shareholders are connected persons of the Company and are thus required to abstain from voting at the EGM: Name of connected persons Number of Shares held as at the Latest Practicable Date Approximate percentage shareholding First Kind (Note 1) 186,750, % Central Success (Note 2) 195,000, % Mr. AN 1,344, % Guidoz (Note 3) 160,050, % Double Grace (Note 4) 120,000, % Ms. LI 1,119, % Ample Wise (Note 5) 34,341, % 7

10 Notes: 1. The entire issued share capital of First Kind International Limited ( First Kind ) is legally and beneficially owned by Hony Capital Fund III, L.P. ( Hony Capital ). Hony Capital is controlled by its sole general partner, Hony Capital Fund III GP, L.P.. Hony Capital Fund III GP, L.P. is in turn controlled by its sole general partner, Hony Capital Fund III GP Limited. Hony Capital Fund III GP Limited is wholly owned by Hony Capital Management Limited, which is in turn owned as to 20.0% by Legend Holdings Limited (through its wholly-owned subsidiary, Right Lane Limited) and 80.0% by Mr. John Huan ZHAO (through Hony Managing Partners Limited, a company wholly owned by him). Legend Holdings Limited is ultimately owned as to 36.0% by the Chinese Academy of Sciences (whose interests in Legend Holdings Limited are held through its wholly-owned subsidiary, Chinese Academy of Sciences Holdings Co., Ltd.), 24.0% by ( ) (Beijing Lian Chi Zhi Yuan Management Consulting Center Limited Partnership), 20.0% by China Oceanwide Holdings Group Co. Ltd., 8.9% by ( ) (Beijing Lian Heng Yong Xin Investment Center Limited Partnership), 3.4% by Mr. LIU Chuanzhi ( ), 2.4% by Mr. ZHU Linan ( ), 1.8% by Mr. NING Min ( ), 1.5% by Mr. HUANG Shaokang ( ),1.0% by Mr. CHEN Shaopeng ( ) and 1.0% by Mr. TANG Xudong ( ). First Kind is a substantial shareholder of the Company. 2. Central Success Developments Limited ( Central Success ) is wholly owned by Mr. AN, who is an executive Director. 3. Guidoz Limited ( Guidoz ) is wholly owned by Mr. YOUNG Wai Po, Peter, who is a non-executive Director. 4. Double Grace International Limited ( Double Grace ) is wholly owned by Ms. LI, who is an executive Director. 5. Ample Wise Holdings Limited ( Ample Wise ) is wholly owned by Mr. WANG Zi Han, who resigned as non-executive Director with effect from 28 March The Board confirms that none of the Grantees will, as a result of the grant of Options, be entitled to be issued with such number of Shares representing over 1% of the Shares in issue upon exercise of all Options granted and to be granted to such Grantee in the 12-month period up to and including the Date of Grant. The Company did not grant any options to each of Mr. AN, Ms. LI and Professor ZHU and their respective associates in the 12-month period prior to the grant of Options to them on 24 March

11 SHAREHOLDING STRUCTURE The following table shows the change in the shareholding structure of the Company as at the Latest Practicable Date and the shareholding structure of the Company assuming the Options granted to Mr. AN, Ms. LI and Professor ZHU are exercised in full by them: As at the Latest Practicable Date Assuming full exercise of the Options First Kind (Note 1) 186,750, % 186,750, % Central Success and Mr. AN (Note 2) 196,344, % 206,344, % Guidoz (Note 3) 160,050, % 160,050, % Double Grace and Ms. LI (Note 4) 121,119, % 131,119, % Ample Wise (Note 5) 34,341, % 34,341, % Professor ZHU 3,000, % Public 301,394, % 301,394, % Total 1,000,000, % 1,023,000, % Notes: 1. The entire issued share capital of First Kind is legally and beneficially owned by Hony Capital. Hony Capital is controlled by its sole general partner, Hony Capital Fund III GP, L.P.. Hony Capital Fund III GP, L.P. is in turn controlled by its sole general partner, Hony Capital Fund III GP Limited. Hony Capital Fund III GP Limited is wholly owned by Hony Capital Management Limited, which is in turn owned as to 20.0% by Legend Holdings Limited (through its wholly-owned subsidiary, Right Lane Limited) and 80.0% by Mr. John Huan ZHAO (through Hony Managing Partners Limited, a company wholly owned by him). Legend Holdings Limited is ultimately owned as to 36.0% by the Chinese Academy of Sciences (whose interests in Legend Holdings Limited are held through its wholly-owned subsidiary, Chinese Academy of Sciences Holdings Co., Ltd.), 24.0% by ( ) (Beijing Lian Chi Zhi Yuan Management Consulting Center Limited Partnership), 20.0% by China Oceanwide Holdings Group Co. Ltd., 8.9% by ( ) (Beijing Lian Heng Yong Xin Investment Center Limited Partnership), 3.4% by Mr. LIU Chuanzhi ( ), 2.4% by Mr. ZHU Linan ( ), 1.8% by Mr. NING Min ( ), 1.5% by Mr. HUANG Shaokang ( ),1.0% by Mr. CHEN Shaopeng ( ) and 1.0% by Mr. TANG Xudong ( ). First Kind is a substantial shareholder of the Company. 2. Central Success is wholly owned by Mr. AN, who is an executive Director. 3. Guidoz is wholly owned by Mr. YOUNG Wai Po, Peter, who is a non-executive Director. 4. Double Grace is wholly owned by Ms. LI, who is an executive Director. 5. Ample Wise is wholly owned by Mr. WANG Zi Han, who resigned as non-executive Director with effect from 28 March The above interests do not take into account the 37,000,000 Options held by the employees of the Company pursuant to the grant of Options on 24 March

12 REASONS FOR THE PROPOSED GRANT Mr. AN has the overall responsibility for determining the long-term business strategy of the Group as a whole. Ms. LI has the overall responsibility for managing the daily operations of the Group according to the business strategy. The Options proposed to be granted to Mr. AN and Ms. LI are served as an appreciation of their dedication and great efforts in the past. The Options will also provide incentive to Mr. AN and Ms. LI for their leadership in the expansion of the Group in the long run, with an aim to enhance Shares value and returns to the Shareholders. Taking into consideration the aforesaid reasons, the Board (including all the independent non-executive Directors) considers that the grant of the Options to each of Mr. AN and Ms. LI is in the best interests of the Company and the Shareholders as a whole. MANDATE LIMIT ON THE SHARE OPTION SCHEME Under the Share Option Scheme, the Board may grant Options to eligible participants to subscribe a maximum of 100,000,000 Shares, being 10% of the Shares in issue on the Listing Date (the Scheme Limit ). As at the Latest Practicable Date, Options (including Options granted to Grantees on 24 March 2014 other than the conditional Options granted to each of Mr. AN and Ms. LI) carrying the rights to subscribe for up to a total of 40,000,000 Shares have been granted under the Share Option Scheme since the approval of the Scheme Limit, of which no Shares were lapsed, cancelled or exercised, and 40,000,000 Shares remain outstanding. Accordingly, there are sufficient unissued Options for the purpose of granting 10,000,000 Options to Mr. AN and 10,000,000 Options to Ms. LI. Pursuant to note 2 to Rule 17.03(3) of the Listing Rules, the Shares which may be issued upon the exercise of all outstanding Options granted and yet to be exercised under the Share Option Scheme at any time shall not exceed 30% of the Shares in issue from time to time. No Options will be granted under the Share Option Scheme if it will result in the 30% limit being exceeded. As at the Latest Practicable Date, the total number of Shares which may be issued upon exercise of all outstanding Options granted and yet to be exercised (including Options granted to Grantees on 24 March 2014 other than the conditional Options granted to each of Mr. AN and Ms. LI) was 40,000,000, representing approximately 4.00% of the issued share capital of the Company as at the Latest Practicable Date. Assuming that the grant of 10,000,000 Options to Mr. AN and the grant of 10,000,000 Options to Ms. LI are approved by the Independent Shareholders at the EGM and that no Options granted under the Share Option Scheme are exercised from the Latest Practicable Date to the date of the EGM, the Company will have 60,000,000 Options outstanding immediately after the EGM, representing approximately 6.00% of the issued share capital of the Company as at the Latest Practicable Date. EGM A notice of the EGM is set out on pages 13 to 14 of this circular. 10

13 As at the Latest Practicable Date, Mr. AN and his associates were interested in 196,344,817 Shares, representing approximately 19.63% of the entire issued share capital of the Company, and Ms. LI and her associates were interested in 121,119,261 Shares, representing approximately 12.11% of the entire issued share capital of the Company. Since each of Mr. AN and Ms. LI and their respective associates are connected persons of the Company, each of them as well as all other connected persons of the Company shall abstain from voting on the resolutions approving the grant of Options. As at the Latest Practicable Date, none of the Shareholders who are required to abstain from voting in favour of the resolution approving the grant of the Options to Mr. AN and Ms. LI has given the Company notice of their intention to vote against such resolutions respectively at the EGM. A form of proxy for use at the EGM is enclosed herewith. Whether or not you are able to attend the EGM, you are requested to complete, sign and return the accompanying form of proxy in accordance with the instructions printed thereon to the Company s branch share registrar and transfer office in Hong Kong, 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 less than 48 hours before the time appointed for the holding of the EGM. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish. VOTING BY WAY OF POLL Pursuant to Rule 13.39(4) of the Listing Rules and Article 79 of the Articles of Association, all votes at the EGM will be taken by poll and the Company will announce the results of the poll in the manner prescribed under Rule 13.39(5) of the Listing Rules. RESPONSIBILITY STATEMENT This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein misleading. 11

14 RECOMMENDATION The Board (including all independent non-executive Directors) consider that the proposed resolutions set out in the notice of the EGM relating to the grant of Options to each of Mr. AN and Ms. LI are in the interests of the Company and the Shareholders as a whole. Accordingly, the Board (including all independent non-executive Directors) recommend the Shareholders to vote in favour of the relevant resolutions to be proposed at the EGM. MISCELLANEOUS The English text of this circular shall prevail over the Chinese text for the purpose of interpretation. Yours faithfully, By order of the Board Consun Pharmaceutical Group Limited AN Yubao Chairman Hong Kong, 13 May

15 NOTICE OF EGM (Incorporated in the Cayman Islands with limited liability) (Stock code: 1681) NOTICE OF EXTRAORDINARY GENERAL MEETING NOTICE IS HEREBY GIVEN that an extraordinary general meeting of Consun Pharmaceutical Group Limited (the Company ) will be held at Taishan Room, Level 5, Island Shangri-La, Hong Kong, Pacific Place, Supreme Court Road, Central, Hong Kong, on Wednesday, 28 May 2014, at 10:30 a.m. or immediately after conclusion of the Company s annual general meeting to be held on the same day, whichever is later, for the following purposes: To consider and, if thought fit, pass with or without amendments, the following resolutions as ordinary resolutions: 1. THAT the grant of share options (the Options ) to Mr. AN Yubao ( Mr. AN ) to subscribe for 10,000,000 ordinary shares of HK$0.1 each in the share capital of the Company ( Shares ) at an exercise price of HK$6.64 per share under the share option scheme adopted by the Company on 2 December 2013 (the Share Option Scheme ) on the terms set out in the circular issued by the Company on 13 May 2014 be and is hereby approved and that the Directors be and are hereby authorized to do all such acts and execute all such documents as may be necessary, desirable or expedient to give full effect to the grant of Options to Mr. AN and the issue of Shares upon exercise of the Options by Mr. AN. 2. THAT the grant of Options to Ms. LI Qian ( Ms. LI ) to subscribe for 10,000,000 Shares at an exercise price of HK$6.64 per share under the Share Option Scheme on the terms set out in the circular issued by the Company on 13 May 2014 be and is hereby approved and that the Directors be and are hereby authorized to do all such acts and execute all such documents as may be necessary, desirable or expedient to give full effect to the grant of Options to Ms. LI and the issue of Shares upon exercise of the Options by Ms. LI. By Order of the Board Consun Pharmaceutical Group Limited AN Yubao Chairman Hong Kong, 13 May

16 NOTICE OF EGM Notes: 1. A member entitled to attend and vote at the meeting shall be entitled to appoint another person as his proxy to attend and, on a poll, vote in his stead. A member who is the holder of two or more Shares may appoint more than one proxy to represent him and, on a poll, vote on his behalf. A proxy need not be a member of the Company. 2. In order to be valid, a proxy form together with any power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power or authority, must be deposited at the branch share registrar of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen s Road East, Wanchai, Hong Kong not less than 48 hours before the time for holding the meeting or any adjournment thereof. 3. The register of members of the Company will be closed from Friday, 23 May 2014 to Wednesday, 28 May 2014 (both days inclusive), during which period no transfer of shares will be registered. In order to determine the identity of the shareholders who are entitled to attend and vote at the extraordinary general meeting, all duly completed transfer documents accompanied by the relevant share certificates must be lodged with the Company s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops , 17th Floor, Hopewell Centre, 183 Queen s Road East, Wanchai, Hong Kong not later than 4:30 p.m. on Thursday, 22 May According to Rule 13.39(4) of the Listing Rules, any vote of Shareholders at general meeting of the Company must be taken by poll. Therefore, all proposed resolutions put to the vote at the EGM will be taken by way of poll and the Company will announce the results of the poll in the manner prescribed under Rule 13.39(5) of the Listing Rules. 5. A circular containing details of the proposed grant of options to each of Mr. AN and Ms. LI will be dispatched to the shareholders of the Company. 6. As at the date of this notice, the Executive Directors of the Company are Mr. AN Yubao, Ms. LI Qian and Professor ZHU Quan; the Non-executive Directors are Mr. YOUNG Wai Po, Peter and Mr. WANG Shunlong; the Independent Non-executive Directors are Mr. SU Yuanfu, Mr. FENG Zhongshi and Ms. CHENG Xinxin. 14