CNA GROUP LTD. (Incorporated in Singapore on 26 January 1990) (Company Registration Number: K)

Transcription

1 CIRCULAR DATED 30 MARCH 2015 THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant, tax adviser or other professional adviser immediately. If you have sold or transferred all your shares in the capital of CNA Group Ltd. (the Company ), you should immediately forward this Circular and the enclosed Notice of Extraordinary General Meeting and Proxy Form to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee. The Singapore Exchange Securities Trading Limited ( SGX-ST ) assumes no responsibility for any of the statements made, reports contained or opinions expressed in this Circular. Approval in-principle has been obtained from the SGX-ST for the listing of and quotation for the Placement Shares (as defined herein) on the main board of the SGX-ST ( Main Board ), subject to certain conditions (more particularly described herein). Approval in-principle granted by the SGX-ST for the listing and quotation of the Placement Shares on the Main Board of the SGX-ST is not to be taken as an indication of the merits of the Placement (as defined herein), the Placement Shares (as defined herein), the Company and/or its subsidiaries. CNA GROUP LTD. (Incorporated in Singapore on 26 January 1990) (Company Registration Number: K) CIRCULAR TO SHAREHOLDERS IN RELATION TO (i) (ii) (iii) THE PROPOSED ALLOTMENT AND ISSUE OF 119,402,900 NEW ORDINARY SHARES IN THE CAPITAL OF THE COMPANY TO HD CAPITAL HOLDING PTE LTD (THE PLACEE ) AT AN ISSUE PRICE OF S$ FOR EACH PLACEMENT SHARE PURSUANT TO THE PLACEMENT AGREEMENT DATED 2 FEBRUARY 2015 BETWEEN CNA GROUP LTD. AND THE PLACEE; THE PROPOSED TRANSFER OF CONTROLLING INTEREST IN THE COMPANY TO HD CAPITAL HOLDING PTE LTD PURSUANT TO THE PLACEMENT; AND PROPOSED APPOINTMENT OF MR SEE SOON HONG AS A NEW DIRECTOR OF THE COMPANY IMPORTANT DATES AND TIMES Last date and time for lodgment of Proxy Form : 10 April 2015 at 10:00 a.m. Date and time of Extraordinary General Meeting : 14 April 2015 at 10:00 a.m. Place of Extraordinary General Meeting : 28 Kaki Bukit Crescent, Kaki Bukit Techpark 1, Singapore

2 CONTENTS Page DEFINITIONS... 3 LETTER TO SHAREHOLDERS 1. INTRODUCTION THE PLACEMENT AND THE TRANSFER OF CONTROLLING INTEREST INFORMATION ON THE PLACEE RATIONALE FOR THE PLACEMENT CHANGES TO THE SHAREHOLDING STRUCTURE FINANCIAL EFFECTS OF THE PLACEMENT EXISTING CONVERTIBLE BONDS INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS DIRECTORS RECOMMENDATION EXTRAORDINARY GENERAL MEETING ACTION TO BE TAKEN BY SHAREHOLDERS DIRECTORS RESPONSIBILITY STATEMENT DOCUMENTS FOR INSPECTION NOTICE OF EXTRAORDINARY GENERAL MEETING PROXY FORM 2

3 DEFINITIONS In this Circular, the following definitions apply throughout unless the context otherwise requires or otherwise stated: Circular : This Circular dated 30 March 2015; Companies Act : The Companies Act, Chapter 50, of Singapore; Company : CNA Group Ltd.; Completion : The completion of the transactions contemplated under the Placement Agreement; Completion Date : The date falling five Market Days after the date on which the conditions precedent in Clause 2 of the Placement Agreement are satisfied (or such other date as may be agreed in writing between the Company and the Placee) but in any event not later than the Long Stop Date; Directors : The directors of the Company as at the date of this Circular; EGM : The extraordinary general meeting of the Company, to be convened for the purposes of considering and, if thought fit, passing with or without modifications, the resolutions as set out in the Notice of EGM; FY : Financial year ended 31 December; Group : The Company and its subsidiaries; Issue Price : S$ per Placement Share; Latest Practicable Date : The latest practicable date prior to the printing of this Circular, being 9 March 2015; Listing Manual : The listing manual of the SGX-ST, as the same may be amended, varied or supplemented from time to time; Long Stop Date : 2 April 2015 or such later date as the parties to the Placement Agreement may agree; Market Date : a day on which SGX-ST (as defined below) is open for securities trading; Notice of EGM : The notice of EGM as set out on page 14 of this Circular; NTA : Net tangible assets; Placee : HD Capital Holding Pte Ltd; Placement : The proposed issue and allotment of 119,402,900 Shares at the Issue Price to the Placee; Placement Agreement : The placement agreement dated 2 February 2015 entered into between the Company and the Placee; 3

4 Placement Shares : 119,402,900 Shares proposed to be allotted and issued by the Company pursuant to the Placement; SGX-ST : Singapore Exchange Securities Trading Limited; Shareholder : A holder of Shares in the Company; Shareholders Approval : The approval of the Shareholders for the issue of the Placement Shares to the Placee; Shares : Ordinary shares in the capital of the Company; Substantial Shareholder : A person who has an interest of not less than 5% of the issued voting shares of the Company; S$ or cents : Singapore dollars or Singapore cents, respectively; and % : Per centum or percentage. The terms Depositor, Depository Agent and Depository Register shall have the meanings ascribed to them respectively in section 130A of the Companies Act. Words importing the singular shall, where applicable, include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders. References to persons shall, where applicable, include corporations. Any reference in this Circular to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined under the Companies Act or any statutory modification thereof and used in this Circular shall, where applicable, have the meaning ascribed to it under the Companies Act or statutory modification as the case may be. Any reference to a time of a day in this Circular is a reference to Singapore time. Any discrepancies in the tables included herein between the amounts therein and the totals thereof are due to rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them. 4

5 LETTER TO SHAREHOLDERS CNA GROUP LTD. (Incorporated in Singapore) (Company Registration Number: K) Directors: Registered Office: Michael Ong Liang Huat (Group President and CEO, Executive Director) 28 Kaki Bukit Crescent Yeung Koon David Yeung (Independent Non-Executive Director) Kaki Bukit Techpark 1 Siew Chak Hung (Non-Executive Director) Singapore Tan Choon Hock (Non-Executive Director) Pang Toh Kang (Independent Non-Executive Director) 30 March 2015 To: The Shareholders of the Company Dear Sir/Madam (i) (ii) (iii) THE PROPOSED ALLOTMENT AND ISSUE OF 119,402,900 NEW ORDINARY SHARES IN THE CAPITAL OF THE COMPANY TO HD CAPITAL HOLDING PTE LTD (THE PLACEE ) AT AN ISSUE PRICE OF S$ FOR EACH PLACEMENT SHARE PURSUANT TO THE PLACEMENT AGREEMENT DATED 2 FEBRUARY 2015 BETWEEN CNA GROUP LTD. AND THE PLACEE; THE PROPOSED TRANSFER OF CONTROLLING INTEREST IN THE COMPANY TO HD CAPITAL HOLDING PTE LTD PURSUANT TO THE PLACEMENT; AND THE PROPOSED APPOINTMENT OF MR SEE SOON HONG AS A NEW DIRECTOR OF THE COMPANY 1 1. INTRODUCTION 1.1 Announcements On 3 February 2015, the Company announced, inter alia, that it had entered into the Placement Agreement with the Placee, pursuant to which the Company has agreed to issue, and the Placee has agreed to subscribe for the Placement Shares at the Issue Price. Pursuant to the Placement and in accordance with the terms and conditions of the Placement Agreement, the Placee has, upon the signing of the Placement Agreement, deposited a few post-dated cheques with the Company which collectively amount to an aggregate of S$3,999,997 in full. On 23 March 2015, the Company announced that it had received the in-principle approval from the SGX-ST for the listing and quotation of the Placement Shares on the Main Board of the SGX-ST subject to certain conditions. Please refer to Paragraph 1.4 of this Circular for further details. 1.2 Rules 803 and Rule 805(1) of the Listing Manual and Section 161 of the Companies Act Section 161 of the Companies Act requires the prior approval of the Company in general meeting to be obtained before the Directors may exercise any power of the company to issue Shares. Shareholders approval for the Proposed Placement is required as: (a) Rule 803 of the Listing Manual stipulates that an issuer must not issue securities to transfer a Controlling Interest without the prior approval of its shareholders in general meeting. As the Placement will result in the transfer of a controlling interest to the Placee, the Company intends to convene an extraordinary general meeting to obtain Shareholders Approval for the issue and allotment of the Placement Shares to the Placee; and 1 Subject to and upon the appointment of Mr See Soon Hong as a director of the Company, the Board intends to appoint him as an executive of the Company. 5

6 (b) Rule 805(1) of the Listing Manual stipulates that an issuer must obtain the prior approval of its shareholders in general meeting for an issue of shares or convertible securities or the grant of options carrying rights to subscribe for shares of the issuer, except where the shares are issued pursuant to a general mandate obtained from shareholders in general meeting. As the placement shares exceed 20% of the total number of issued shares of the Company excluding treasury shares, the Company will not be relying on the general mandate of the Company and instead intends to convene an extraordinary general meeting to obtain Shareholders Approval for the issue and allotment of the Placement Shares to the Placee. 1.3 Circular The purpose of this Circular is to explain the reasons for, and to provide Shareholders with information relating to the ordinary resolution to be tabled at the EGM to be held at 28 Kaki Bukit Crescent, Kaki Bukit Techpark 1, Singapore on 14 April 2015 at 10:00 a.m SGX-ST s In-principle Approval On 23 March 2015, the SGX-ST granted the in-principle approval for the listing and quotation of the Placement Shares on the Main Board of the SGX-ST subject to, the following conditions being fulfilled: (a) (b) (c) (d) Compliance with the SGX-ST s listing requirements; Shareholders approval being obtained for the Proposed Placement at the EGM to be convened; Disclosure of the Director s views in the shareholders circular of whether the fees paid to the introducer of the Placee is in the interest of the Company; and Submission of the following documents: (i) (ii) (iii) A written undertaking from the Company that it will comply with Rule 704(30) and Rule 1207(20) of the Listing Manual in relation to the use of the proceeds from the Proposed Placement of shares and where proceeds are to be used for working capital purposes, the Company will disclose a breakdown with specific details on the use of proceeds for working capital in the Company s announcements on use of proceeds and in the annual report; A written undertaking from the Company that it will comply with Listing Rule 803; and A written confirmation from the Company that it will not issue the Placement Shares to persons prohibited under Rule 812(1) of the Listing Manual. Approval in-principle granted by the SGX-ST for the listing and quotation of the Placement Shares on the Main Board of the SGX-ST is not to be taken as an indication of the merits of the Placement (as defined herein), the Placement Shares (as defined herein), the Company and/or its subsidiaries. The SGX-ST assumes no responsibility for any of the statements made, opinions expressed or reports contained in this Circular. 2. THE PLACEMENT AND THE TRANSFER OF CONTROLLING INTEREST 2.1 The Placement Agreement Pursuant to the Placement Agreement, the Company agreed to allot and issue to the Placee, and the Placee has agreed to subscribe for the Placement Shares at the Issue Price at Completion. Pursuant to the Placement, the Placee has deposited post-dated cheques with the Company an aggregate of S$3,999,997 in full upon the signing of the Placement, and in accordance with the terms and conditions of the Placement Agreement. 6

7 The Issue Price represents a discount of 8.72% to the volume weighted average price of S$ per Share for trades done on the SGX-ST for 2 February 2015 (being the Market Day on which the Placement Agreement was signed). Based on the issued share capital of the Company of 483,222,128 Shares as at the Latest Practicable Date, the issue of the Placement Shares will increase the issued share capital of the Company from 483,222,128 Shares to 602,625,028 Shares immediately following the completion of the Placement. The Placement Shares represent approximately 24.71% of the issued share capital of the Company as at the Latest Practicable Date and approximately 19.81% of the enlarged issued share capital of the Company after the completion of the Placement. The Placee with be a controlling shareholder of the Company pursuant to the issue of the Placement Shares and the Placement, if approved, will result in the transfer of a controlling interest in the Company to the Placee. Pursuant to Rule 803 of the Listing Manual, an issuer must not issue securities to transfer a controlling interest without the prior approval of its shareholders in general meeting. Accordingly, Shareholders Approval for the Placement is sought pursuant to Rule 803 of the Listing Manual. Please refer to Paragraph 5 of this Circular entitled Changes to the Shareholding Structure for more information. The Placement Shares shall be issued free from all claims, charges, liens and other encumbrances whatsoever, are uniform and shall rank pari passu in all respects with and carry all rights similar to the existing Shares save for any dividends, rights, allotments or other distributions, the record date for which falls before the date of issue of the Placement Shares. 2.2 Conditions Precedent for the Completion Completion is conditional upon, inter alia, the satisfaction of each of the following conditions precedent: (i) (ii) (iii) (iv) approval for the listing and quotation of the Placement Shares on the SGX-ST being obtained from the SGX-ST (the Listing Approval ) and, where such approval is subject to conditions (which are not normally imposed by the SGX-ST for a transaction of a similar nature), such conditions being acceptable to the Company and, to the extent that any conditions for the listing and quotation of the Placement Shares on the SGX-ST are required to be fulfilled on or before the Completion Date, they are so fulfilled; the approval of the Directors being obtained in respect of the transactions contemplated by this Agreement including but not limited to the issue and allotment of the Placement Shares, and the same not having been withdrawn or revoked and if such consents or approvals are obtained subject to any conditions, such conditions being acceptable to the parties hereto; the approval of the Shareholders for the issuance and allotment of the Placement Shares to the Placee being obtained in a general meeting; and the subscription, issue and allotment, and offering (if any) of the Placement Shares being in compliance with the Securities and Futures Act in connection with offers of securities and not being prohibited by any statute, order, rule or regulation promulgated by any legislative, executive or regulatory body or authority of Singapore. 2.3 Appointment of Director In connection with the Placement, the Company is proposing to appoint Mr See Soon Hong, who has a beneficial interest in the Placee, as a new executive director 2 of the Company to tap on his substantial expertise, experience and network. 2 Subject to and upon the appointment of Mr See Soon Hong as a director of the Company, the Board intends to appoint him as an executive of the Company. 7

8 Mr See Soon Hong is a Singaporean who is 42 years old. He has held directorships in companies since He is currently a director and shareholder of Brilliant Food Pte Ltd, LGA Holdings Pte Ltd, LGA Group LLP and HD Capital Holding Pte Ltd. He is also the founder of LGA Holdings Pte Ltd and LGA Group LLP, both of which have been and are in the business of global import and export trading of mineral oil and gas since 2011 and have extensive business networks in Africa and Asia, and especially in the People s Republic of China ( PRC ). Mr See Soon Hong was also the former Vice-Consul of the Consulate of Madagascar in Singapore, and was the Chairman of the youth wing of the People s Action Party from 2007 to He is also actively involved in local grass root activities. 2.4 Placement Agents and Introducers No placement agents were appointed in relation to the Placement and no commissions were paid to any placement agents in relation to the Placement. However, an introducer fee of S$200,000 was paid to Han Bing (the Introducer ) representing approximately 5% of the aggregate gross consideration of S$3,999,997, and was negotiated on a willing-seller willing-buyer basis. No part of the commission will be shared with the Placee. The Group has recently won several new projects which will proceed with effect from March The Group requires additional working capital to fund these new projects. Due to the weaker financial position of the Group, the Company has not been able to receive any financing from banks on terms which are feasible to the Company. Having access to the Placement Funds will enable the Company to move its various projects forward (many of which are time sensitive) and to not lose any potential business opportunities. It will also improve the gearing position of the Company. In facilitating the Placement, the Introducer has had a challenging task to merge the interests of the investor/placee with that of the Company. With the involvement of Chinese parties, the workload of the Introducer has also increased due to the number of overseas calls and trips that had to be made. Notwithstanding the increased workload of the Introducer, the Company has only agreed to a commission of 5% in line with the commissions paid for other placements carried out by the Company. Based on the above, the Directors are of the view that the payment of commission to the Introducer for the Placement is in the interests of the Company. 3. INFORMATION ON THE PLACEE Background and rationale for the Details on how Placee s subscription Number of the Placee was of the Placement Name of Placee Placement Shares identified Shares HD Capital Holding 119,402,900 Introduced by the Investment holding Pte Ltd Introducer company that has invested in the Placement for investment purposes 3.1 The Placee and its respective shareholders and directors (in the case of corporate Placee), are investors who have no connection (including business relationships) with the Company, its Directors and Substantial Shareholders, and are not persons to whom the Company is prohibited from issuing shares to, as provided by Rule 812 of the Listing Manual. The Placee, expressed interest to separately invest in the Company and, after negotiations, the Company agreed to place the Placement Shares to it. As at the date of this announcement, the Placee does not hold any Shares in the Company. 3.2 The Placee is not holding the Placement Shares in trust or as a nominee. The people who have a beneficial interest in the Placee are Ms Jia Shujie and Mr See Soon Hong who hold shares in the Placee in the proportion of 51:49 respectively. There are no investments held by the Proposed Placee and there is no conflict of interest between the business of the Proposed Placee and/or its shareholders and the business of the Company. 8

9 3.3 Ms Jia Shujie is 45 years of age and is a PRC national with 20 years of experience in investments and trade in the PRC and Singapore. She has a wide business network in various industries and is a director of various private companies in PRC and Singapore. 3.4 Details of Mr See Soon Hong can be found in Paragraph 2.3 of this Circular. 3.5 To the best of the Company's knowledge, there is no agreement, arrangement or understanding between the Placee or other Shareholders of the Company to acquire Shares to obtain or consolidate effective control of the Company, and the Placee is not acting in concert with any other Shareholder of the Company, as defined in The Singapore Code on Take-Overs and Mergers. 4. RATIONALE FOR THE PLACEMENT 4.1 Rationale The purpose of the Placement is to allow the Company to raise the Net Proceeds (as defined below) which will be used for general working capital and to acquire a minority interest in Jilin Mailongxuntong Electric Products Co., Ltd. ( JME ). 4.2 Background of Jilin Mailongxuntong Electric Products Co., Ltd. JME is principally engaged in the business of the integration and maintenance of traffic monitoring (e.g. security and speed cameras) and closed-circuit television systems in Jilin Province, China. The Company decided to invest in JME mainly because it is envisaged that the Company s network of speed cameras will generate significant revenues, especially since JME has procured a 10 year service concession to provide speed camera services to the Traffic Police in Jilin Province, China. JME has also recently won a second 10 year concession in another city and is confident that it can continue to expand its services to other provinces in the PRC. Han Bing is the introducer to the acquisition of JME. Mr See Soon Hong is a minority shareholder of JME with a shareholding of 26%. After the proposed acquisition by the Company of a minority interest in JME, Mr See Soon Hong will retain 5% shareholding in JME. The other 2 majority shareholders of JME are individuals not related to and have no connection with Mr See Soon Hong or Ms Jia Shujie. The Directors and substantial shareholders of the Company have no connections (including any business relationship) with JME, its directors and its substantial shareholders; and have no interest, direct or indirect, in JME. 4.3 Proceeds from the Placement The estimated net proceeds from the Placement, after deducting estimated expenses pertaining to the Placement, will be S$3,799,997. The proposed use of the net proceeds from the Placement ( Net Proceeds ) will be as set out below: Estimated Percentage Use of Net Proceeds Amount (S$) Allocation (%) Working Capital 2,799, Investment 1,000, Pending the deployment of the Net Proceeds, the Net Proceeds may be placed in deposits with banks and/or financial institutions as the Directors may deem fit in their absolute discretion. The Company intends to use the Net Proceeds for general working capital and and to acquire a minority interest in JME. The Company will make periodic announcements on the utilization of the Net Proceeds as and when the funds from the Placement are materially disbursed and provide a status report on the use of the Net Proceeds in the Company s annual report. When the Net Proceeds are used for the working capital of the Company, the Company will provide specific details on the use of proceeds for working capital in announcements and annual reports. Where there is any material deviation from the stated use of proceeds, the Company will announce the reasons for such deviation. 9

10 5. CHANGES TO THE SHAREHOLDING STRUCTURE The Placement Shares will represent approximately 19.81% of the enlarged issued share capital of the Company after the completion of the Placement. Based on the Company s current issued share capital of 483,222,128 Shares as at the Latest Practicable Date, the following tables set out the impact on the percentage shareholding of existing Shareholders and Directors of the Company following completion of the Placement:- Before the Placement After the Placement Direct Deemed Direct Deemed Interest Interest Interest Interest No. of No. of No. of No. of Shares % Shares % Shares % Shares % Shareholders Substantial Existing Shareholders Mitsubishi Electric Asia Pte Ltd 35,000, ,000, Mitsubishi Electric 35,000, ,000, Corporation Mitsui & Co Ltd 26,495, ,495, The Placee HD Capital Holding 119,402, Pte Ltd See Soon Hong 119,402, Jia Shujie 119,402, Directors Michael Ong Liang 5,331, ,331, Huat Yeung Koon Sang 214, ,000 Yeung Siew Chak Hung 4,000, ,000, Pang Toh Kang 30, , Tan Choon Hock The Placee will acquire a controlling interest (as defined in the Listing Manual) in the Company pursuant to the issue of the Placement Shares. 6. FINANCIAL EFFECTS OF THE PLACEMENT 6.1 Assumptions For illustration purposes only, the table below sets out the financial effects of the Placement based on the following bases and assumptions:- (i) The announced consolidated financial statements of the Company for the financial year ended 31 December 2014; and 3 Mr See Soon Hong is deemed interested in the 19.81% of Shares held by HD Capital Holding Pte Ltd. 4 Ms Jia Shujie is deemed interested in the 19.81% of Shares held by HD Capital Holding Pte Ltd. 10

11 (ii) The financial impact on the consolidated NTA per Share of the Company is computed based on the assumption that the Placement was completed on 31 December 2014 and in relation to the Company s consolidated earnings per Share ("EPS"), computed based on the assumption that the Placement was completed on 1 January As at the Latest Practicable Date, the issued and paid-up share capital of the Company is S$71,039,468 divided into 483,222,128 Shares. Upon completion of the Placement, the issued and paid-up share capital of the Company will increase by S$3,999,997 to S$75,039,465 divided into 602,625,028 Shares. (iii) Share Capital The effect of the Placement on the issued and paid up share capital of the Company as at the Latest Practicable Date is as follows: No. of Shares S$ Issued and paid-up share capital as 483,222,128 71,039,468 at the Latest Practicable Date Increase in issued share capital 119,402,900 3,999,997 pursuant to the allotment and issue of the Placement Shares Enlarged share capital after the 602,625,028 75,039,465 Completion of the Placement 6.2 Earnings Assuming that the Placement had been completed on 1 January 2014, being the beginning of the most recently completed financial year, based on the Group s consolidated financial statements for FY2014, the pro forma financial effects on the earnings per Share for FY2014 would be as follows:- Before the Placement After the Placement Profit/(Loss) after tax and minority interests (29.5) (29.5) (S$ million) Weighted average number of Shares (million) Earnings/(Loss) per Share (S$) (0.07) (0.06) 6.3 NTA Assuming that the Placement had been completed on 31 December 2014, being the end of the most recently completed financial year, and based on the consolidated financial statements of the Group as at 31 December 2014, the pro forma financial effects on the NTA per Share, would be as follows:- Before the Placement After the Placement NTA (S$ 000) 9,204 13,204 NTA per Share (S$ cents)

12 6.4 Gearing For the purposes of illustration only, the effect of the Placement on the gearing of the Group based on the Group s consolidated financial statements of the Group as at 31 December 2014 is as follows: As at 31 December 2014 After Completion Total borrowings (S$ 000) 39,816 39,816 Shareholders funds (S$ 000) 71,039 75,039 Gearing (%) 56.0% 53.1% 7. EXISTING CONVERTIBLE BONDS 7.1 The Company had on 29 April 2014 entered into a bond subscription agreement ( Bond Subscription Agreement ) with Pacific Alliance Asia Opportunity Fund L.P. ( Subscriber ). At an extraordinary general meeting of the Company held on 29 August 2014, the Company obtained shareholders approval for (i) the issue to the Subscriber, of redeemable zero coupon convertible bonds with an aggregate principal amount of S$120 million issuable in (i) two separate successive tranches of initial bonds ( Initial Bonds ) and (ii) 58 separate successive tranches of subsequent bonds ( Subsequent Bonds ) (collectively, the Bonds ) in accordance with the terms and conditions of the Bond Subscription Agreement. On 8 August 2014, the Company received approval-in-principle from the SGX-ST for, inter alia, the listing and quotation of up to 2,400,000,000 new shares to be issued upon conversion of the Bonds ( Approved New Share Issue ). 7.2 As at the date of this Circular, the Company has issued the Initial Bonds to the Subscriber and the Subscriber has converted the first tranche of the Initial Bonds. The second tranche of the Initial Bonds (the Second Tranche Initial Bonds ) with an outstanding principal amount of S$2,000,000 remains outstanding but not converted. Pursuant to condition 4.3 of the terms and conditions of the Bond Subscription Agreement ( Terms and Conditions ) in respect of the Initial Bonds, the conversion prices of the Initial Bonds will be subject to adjustment upon the occurrence of certain events ( Events of Adjustment ). In particular, pursuant to condition and 4.6 of the Terms and Conditions, an issue of shares under the proposed placement, being an issue of shares at less than the current market price and fixed conversion price (each as defined in the Bond Subscription Agreement), shall result in an adjustment to the fixed conversion price and minimum conversion price. Assuming full conversion of the Bonds by the Subscriber, an adjustment to the minimum conversion price will require the Company to issue additional shares under the Bond Subscription Agreement. 7.3 The Company at the present moment is unable to ascertain the number of shares to be issued in connection with the conversion of the Second Tranche Initial Bonds with certainty (as it is to be calculated based on a formula which fluctuates with the market price of the shares of the Company). Further, as the Second Tranche Initial Bonds and Subsequent Bonds have not been issued and/or converted (as the case may be), the number of shares issued pursuant to the Bond Subscription Agreement is still substantially below the number of shares the Company may issue under the Approved New Share Issue. 7.4 The Company will make an additional listing application for any additional number of shares (over the Approved New Share Issue) and will first seek specific shareholders approval for the issue of any additional number of shares. 8. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS 8.1 Interests in the Company The interests of the Directors and Substantial Shareholders in the share capital of the Company as at the Latest Practicable Date are set out in Paragraph 5 above. 12

13 8.2 Interests in the Placement None of the Directors and to the best of the knowledge of the Directors, none of the Substantial Shareholders, have any connection with the Placee or its directors or substantial shareholders (in the case of a corporate Placee) or have any interest, direct or indirect in the Proposed Placement. 9. DIRECTORS RECOMMENDATION The Directors are of the unanimous opinion that the Placement is in the best interests of the Company and accordingly recommend that the Shareholders vote in favour of the resolutions set out in the Notice of EGM. 10. EXTRAORDINARY GENERAL MEETING The EGM, notice of which is set out on page 14 of this Circular, will be held on 14 April 2015 at Kaki Bukit Crescent, Kaki Bukit Techpark 1, Singapore at 10:00 a.m. for the purpose of considering and, if thought fit, passing, with or without modifications, the ordinary resolutions set out in the Notice of EGM. 11. ACTION TO BE TAKEN BY SHAREHOLDERS Shareholders who are unable to attend the EGM and wish to appoint a proxy to attend and vote at the EGM on their behalf will find a Proxy Form attached to this Circular which they should complete, sign and return in accordance with the instructions printed thereon as soon as possible and in any event so as to arrive at the registered office of the Company not less than 48 hours before the time fixed for the EGM. The sending of a Proxy Form by a Shareholder does not preclude him from attending and voting in person at the EGM in place of his proxy if he finds that he is able to do so. 12. DIRECTORS RESPONSIBILITY STATEMENT The Directors collectively and individually accept full responsibility for the accuracy of the information given in this Circular and confirm after making all reasonable enquiries that, to the best of their knowledge and belief, this Circular constitutes full and true disclosure of all material facts about the Placement, the Company and its subsidiaries, and the Directors are not aware of any facts the omission of which would make any statement in this Circular misleading. Where information in the Circular has been extracted from published or otherwise publicly available sources or obtained from a named source, the sole responsibility of the Directors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in the Circular in its proper form and context. 13. DOCUMENTS FOR INSPECTION Copies of the following documents are available for inspection at the office of the Company at during normal business hours from the date hereof up to and including the date of the EGM: (a) (b) (c) The Placement Agreement; The latest annual report of the Company; and The Memorandum and Articles of Association of the Company. Yours faithfully For and on behalf of the Board of Directors of CNA GROUP LTD. Michael Ong Liang Huat Chairman 13

14 CNA GROUP LTD. (Incorporated in the Republic of Singapore) (Company Registration Number: k) NOTICE OF EXTRAORDINARY GENERAL MEETING NOTICE IS HEREBY GIVEN that an EXTRAORDINARY GENERAL MEETING ( EGM ) of CNA Group Ltd. (the Company ) will be convened on 14 April 2015 at 28 Kaki Bukit Crescent, Kaki Bukit Techpark 1, Singapore at 10:00 a.m., for the purpose of considering and, if thought fit, passing with or without any modifications the following resolution-: AS ORDINARY RESOLUTIONS RESOLUTION 1 - THE PROPOSED ALLOTMENT AND ISSUE OF 119,402,900 NEW ORDINARY SHARES IN THE CAPITAL OF THE COMPANY TO HD CAPITAL HOLDING PTE LTD (THE PLACEE ) AT AN ISSUE PRICE OF S$ FOR EACH PLACEMENT SHARE PURSUANT TO THE PLACEMENT AGREEMENT DATED 2 FEBRUARY 2015 BETWEEN CNA GROUP LTD. AND THE PLACEE That, subject to and contingent upon Resolution 2 in this Notice of EGM being passed: (a) (b) approval be and is hereby given to the directors of the Company ( Directors ) to allot and issue to the Placee an aggregate of 119,402,900 new ordinary shares (the Placement Shares ) in the capital of the Company at an issue price of S$ per Placement Share payable in cash, subject to, and in accordance with, the terms of the share Placement Agreement entered into between the Company and the Placee on 2 February 2015 (the Placement Agreement ); and the Directors and each of them be and are hereby authorised to complete and to do any and all such acts and things (including making such amendments to the terms and conditions of the Placement Agreement and executing all such documents as may be required) as they or he may consider necessary, desirable or expedient to give effect to the Placement Agreement and this Resolution, with such modification thereto (if any) as they shall deem fit in the interests of the Company. RESOLUTION 2 THE PROPOSED TRANSFER OF CONTROLLING INTEREST IN THE COMPANY TO HD CAPITAL HOLDING PTE LTD PURSUANT TO THE PLACEMENT That, subject to and contingent upon Resolution 1 in this Notice of EGM being passed: (a) (b) approval be and is hereby given for the transfer of controlling interest in the Company to HD Capital Holding Pte Ltd under Rule 803 of the Listing Manual pursuant to the Placement to HD Capital Holding Pte Ltd; and the Directors and each of them be and are hereby authorised to complete and to do any and all such acts and things (including making such amendments to the terms and conditions of the Placement Agreement and executing all such documents as may be required) as they or he may consider necessary, desirable or expedient to give effect to the Placement Agreement and this Resolution, with such modification thereto (if any) as they shall deem fit in the interests of the Company. 5 Subject to and upon the appointment of Mr See Soon Hong as a director of the Company, the Board intends to appoint him as an executive of the Company. 14

15 RESOLUTION 3 THE PROPOSED APPOINTMENT OF MR SEE SOON HONG AS A NEW DIRECTOR OF THE COMPANY 5 THAT: (a) (b) approval be and is hereby given for the appointment of Mr See Soon Hong as a new director of the Company; and the Directors and each of them be and are hereby authorized to complete and to do any and all such acts and things (including making such amendments to the terms and conditions of the Placement Agreement and executing all such documents as may be required) as they or he may consider necessary, desirable or expedient to give effect to the Placement Agreement and this Resolution, with such modification thereto (if any) as they or he shall deem fit in the interests of the Company. BY ORDER OF THE BOARD Lun Chee Leong Company Secretary 30 March 2015 Notes: - a. Every shareholder of the Company entitled to attend and vote at the EGM is entitled to appoint not more than two proxies to attend and vote on his behalf. A proxy need not be a shareholder of the Company. b. A shareholder of the Company which is a corporation is entitled to appoint its authorised representative or proxies to vote on its behalf. c. The instrument appointing a proxy must be deposited at the registered office of the Company at No. 28 Kaki Bukit Crescent, Kaki Bukit Techpark 1, Singapore , at least 48 hours before the time set for the EGM or any postponement or adjournment thereof. 15

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17 CNA GROUP LTD. (Incorporated in the Republic of Singapore) (Company Registration Number: K) PROXY FORM I/We of being a shareholder / member of CNA GROUP LTD. (the Company ) hereby appoint:- (Name) (Address) Name Address NRIC/ Proportion of Passport No. Shareholding (%) (if more than one (1) proxy is appointed) and/or (delete as appropriate) Name Address NRIC/ Proportion of Passport No. Shareholding (%) (if more than one(1) proxy is appointed) or failing whom the Chairman of the Extraordinary General Meeting as my/our proxy/proxies to vote for me/us on my/our behalf and, if necessary, to demand a poll at the Extraordinary General Meeting of the Company to be convened on 14 April 2015 at 28 Kaki Bukit Crescent, Kaki Bukit Techpark I, Singapore at 10:00 a.m. and at any adjournment thereof. I/We direct my/our proxy/ proxies to vote for or against the Ordinary Resolution to be proposed at the Extraordinary General Meeting as indicated hereunder. If no specific direction as to voting is given, the proxy/proxies will vote or abstain from voting at his/her/their discretion, as he/she/they will on any other matter arising at the Extraordinary General Meeting. Resolution (1) To approve the proposed allotment and issue of an aggregate of 119,402,900 new ordinary shares in the capital of the Company to HD Capital Holding Pte Ltd (the Placee ) pursuant to the Placement Agreement dated 2 February 2015 entered into between the Company and the Placee To be used on a show of hands For* Against* (2) To approve the transfer of controlling interest in the Company to HD Capital Holding Pte Ltd under Rule 803 of the Listing Manual pursuant to the Placement to HD Capital Holding Pte Ltd (3) To approve the appointment of Mr See Soon Hong as a new director of the Company 6 * Please indicate your vote For or Against with an x within the box provided. Dated this day of 2015 Total Number of Shares Held CDP register Register of Members Signature(s) of Member(s)/Common Seal IMPORTANT: PLEASE READ NOTES OVERLEAF BEFORE COMPLETING THIS PROXY FORM 6 Subject to and upon the appointment of Mr See Soon Hong as a director of the Company, the Board intends to appoint him as an executive of the Company.

18 Notes :- 1. A shareholder of the Company ( Shareholder ) entitled to attend and vote at the Extraordinary General Meeting is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a Shareholder. 2. Where a Shareholder appoints more than one proxy, the appointments shall be invalid unless he specifies the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy. 3. If any proxy/proxies is/are to be appointed, please strike out the words the Chairman of the Extraordinary General Meeting and insert the name(s) and address(es) of the proxy/proxies desired in the blank space provided. 4. A Shareholder should insert the total number of shares of the Company ( Shares ) held by such Shareholder. If the Shareholder has Shares entered against his/her name in the Depository Register (as defined in Section to 130A of the Companies Act, Cap. 50 of Singapore), he/she should insert that number of Shares. If the Shareholder has Shares registered in his/her name in the Register of Members of the Company, he/ she should insert that number of Shares. If the Shareholder has Shares entered against his/her name in the Depository Register and registered in his/her name in the Register of Members, he/she should insert the aggregate number of Shares. If no number is inserted, the instrument appointing a proxy or proxies will be deemed to relate to all Shares held by the Shareholder. 5. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company located at No. 28 Kaki Bukit Crescent, Kaki Bukit Techpark I, Singapore , not less than 48 hours before the time set for the Extraordinary General Meeting. 6. The instrument appointing a proxy or proxies must be under the hand of the appointor or by his/her attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its common seal or under the hand of its attorney or a duly authorised officer. 7. Where an instrument appointing a proxy or proxies is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified true copy thereof must (failing previous registration with the Company) be lodged with the instrument of proxy, failing which the instrument may be treated as invalid. 8. A corporation which is a Shareholder may, in accordance with Section 179 of the Companies Act, Cap. 50 of Singapore, authorise by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the Extraordinary General Meeting. 9. The Company shall be entitled to reject the instrument appointing a proxy or proxies, if it is incomplete, improperly completed, illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified on the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies if a Shareholder, being the appointor, is not shown to have Shares entered against his/her name in the Depository Register as at 48 hours before the time appointed for holding the Extraordinary General Meeting, as certified by the Central Depository (Pte) Limited to the Company. 10. By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, speak and vote at the Extraordinary General Meeting and/or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member s personal data by the Company (or its agents or service providers) for the purpose of the processing, administration and analysis by the Company (or its agents or service providers) of proxies and representatives appointed for the Extraordinary General Meeting (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the Extraordinary General Meeting (including any adjournment thereof), and in order for the Company (or its agents or service providers) to comply with any applicable laws, listing rules, regulations and/or guidelines (collectively, the Purposes ), (ii) warrants that where the member discloses the personal data of the member s proxy(ies) and/or representative(s) to the Company (or its agents or service providers), the member has obtained the prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company (or its agents or service providers) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member s breach of warranty.

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