HAITONG Securities : Announcement_H Share

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

Board of Directors (the "Board") of Haitong Securities Co., Ltd (the "Company") hereby announces that:

With effect from 28 March 2014, Mr. Li Mingshan ("Mr. Li") resigns as the Director and General
Manager of the Company.
Mr. Li tendered his resignation to the Board of the Company due to reason of age and resigns as the Director and General Manager of the Company. After his resignation, Mr. Li is no longer a member of the Compliance and Risk Management Committee of the Company. Mr. Li confirms that there is no disagreement between him and the Board of the Company during his term of office and there is no matter relating to his resignation that needs to be brought to the attention of the shareholders of the Company (the "Shareholders").
The valuable contribution made by Mr. Li to the Company during his term of office is greatly appreciated by the Board of the Company.

The Board has approved the grant of the general mandate to authorise, allot or issue A shares of the Company (the "A Shares") and/or H shares of the Company (the "H Shares") and proposed it to be considered at the shareholders' general meeting. Details of this general mandate are as follows:
In compliance with the regulations stipulated in the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited (the "Hong Kong Listing Rules") and the articles of association of the Company (the "Articles of Association"), and subject to the terms and conditions set out in the following provisions (1), (2) and (3), it is proposed that the shareholders' general meeting grant an unconditional general mandate to the Board to authorize, allot or issue A Shares and/or H Shares (including warrants, convertible bonds and other securities which carry
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rights to subscribe for or are convertible into Shares) separately or concurrently, and to sign the necessary documents, complete the necessary formalities and take other necessary steps to complete the aforesaid matters:
(1) the authorisation is valid for the period from the date of passing of this resolution at the shareholders' general meeting to approve the grant of such authorisation until whichever is the earliest of:
(a) the conclusion of the next annual shareholders' general meeting of the Company following the passing of this resolution at the shareholders' general meeting; or
(b) the expiration of the 12-month period following the passing of this resolution at the shareholders' general meeting; or
(c) the date on which the authorisation set out in this resolution is revoked or varied by a resolution of the shareholders of the Company at any shareholders' general meeting.
Should the Board, during the validity period of the authorisation, sign the necessary documents, complete the necessary formalities or take relevant steps which might require to be performed or carried out upon or after the end of the validity period or continued until the end of the validity period, the validity period of the authorisation will be extended accordingly;
(2) the respective number of the A Shares and/or H Shares which the Board proposes to authorise, allot or issue, or conditionally or unconditionally agrees to authorise, allot or issue (including warrants, convertible bonds, other securities which carry rights to subscribe for or are convertible into Shares, which will be calculated based on the aggregate number of Shares potentially convertible by them) shall not exceed 20% of the respective number of the A Shares and/or H Shares of the Company in issue as at the date of passing of this resolution at the shareholders' general meeting;
(3) the Board shall exercise the authorisation pursuant to the Company Law of the PRC, the Hong Kong Listing Rules or all applicable laws, regulations and requirements of any other government or regulatory authorities and with the approval by CSRC and/or other relevant governmental authorities in the PRC.
With respect to an issue of shares pursuant to the general mandate set out in this resolution, a proposal is made to the shareholders' general meeting to authorise the Board to increase the Company's registered capital corresponding to the number of shares issued under the general mandate, to make amendments to the Articles of Association of the Company where applicable and necessary in response to the increase of the Company's registered capital, and to take any other necessary actions and complete any other necessary procedures.
After the Board has obtained the aforesaid general mandate, a proposal is made to the shareholders' general meeting to approve the Board to in turn authorise the chairman and the general manager of the Company to jointly or separately sign, execute, amend, complete and submit all agreements, contracts and documents relating to the recognition, allotment or issuance of shares under the general authorisation, unless otherwise provided by laws and regulations.
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According to Chapter 17 of the Hong Kong Listing Rules, the Board has considered the Share Option Incentive Scheme (the "Scheme") for UT Capital Group Co., Limited (the "UT Capital") on 28 March 2013.

A summary of the major terms of the Scheme is set out below.

1. Purpose of the Scheme

The Scheme is to further optimize the corporate governance structure of UT Capital and its subsidiaries (the "UT Group"), establish and improve the incentive and discipline mechanism of UT Group in the medium and long term, unleash motivation of the management, function as a measure to attract and retain quality executives, align the interests of Shareholders and corporate interests with personal interests of the management for securing the sustainable healthy development of UT Group.

2. Participants

The participants of the Scheme (the "Participants") include directors, senior management, key operational managerial personnel and key technical (business) personnel of UT Capital and its subsidiaries as determined by the board of UT Capital, the total number of which shall not be over 50.

3. Source and number of target share

The Scheme is intended to grant no more than 97,321,500 Share Options to the Participants, representing approximately 6% of the total amount of issued shares of UT Capital at the time of the announcement of the Scheme ("Total Share Capital"). Every Share Option provides the right to purchase one ordinary share of UT Capital with USD or equivalent RMB on the exercise date subject to the exercise price and exercise conditions as determined under the Scheme. The total number of shares to be granted under the Scheme to an individual grantee will not exceed 3% of the Total Share Capital. The total number of shares acquired through the share options (including both exercised and outstanding options) within 12 months will not exceed 1% of the Total Share Capital.

4. Validity Period, Allocation Date, Granting Date of the Scheme, Validity Period, Waiting

Period, Exercise Date of the Share Option

1) Validity Period of the Scheme: the validity period of the Scheme will cover a period of five years commencing from the date of approval of the Scheme at the general meeting of the Company.
2) Allocation Date: after the approval of the Scheme at the general meeting of the Company and the fulfilment of necessary registration procedures, allocation will be made to the Participants by the Board of UT Capital.
3) Granting Date: after the fulfilment of continuous employment and other conditions required under the Scheme by the Participant, the allocated Option shall be granted at the average annual ratio of 25% within four years. Granting Date shall be 30 April of that year.
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4) Validity Period of the Share Option: the Share Option shall be effective for five years commencing from the Granting Date of the Share Option.
5) Waiting Period: waiting period represents the period between granting date of the Share Option and the exercisable date of the Share Option. There is no waiting period for the Share Options granted under the Scheme.
6) Exercisable date: after the grant of every Share Option, the holder is entitled (but is not obligated) to purchase one share of UT Capital at the corresponding exercise price within the validity period.

5. Exercise Price and Determination of Exercise Price

1) The exercise price of the first batch of Share Option under the Scheme is US$0.4552;
2) The exercise price of the subsequent batch of the Share Option shall increase 8% every year based on the exercise price of first batch of Share Option.
3) If the Company resolves to seek approval for the spin-off listing of UT Group, the exercise price of the Options granted within the period from the date of resolution or the date of the lodgement of Form A1 (or its equivalent for listing on other stock exchange) to Hong Kong Stock Exchange by UT Group, whichever is earlier, to the listing date of UT Group can be adjusted when necessary to ensure that the exercise price will not be lower than the new issue price.

6. Granting conditions of Share Option

Among the Options granted each year, 50% of which is based on time condition, and the remaining 50% of which is based on the performance condition.
1) Time Condition: subject to the fulfilment of the continuous employment condition by the Participants prior to the granting date every year, Share Options based on time condition can be granted.
2) Performance Condition: subject to the fulfilment of the continuous employment condition and other terms of the Scheme and if UT Capital achieves the performance condition of the previous year as approved by the Board of UT Capital (the specific performance conditions are to be determined by the Board of UT Capital), Share Options based on the performance condition of that year can be granted; if the performance condition of the previous year is not achieved, the number of Share Options to be granted would be deducted based on the achievement status, until full deduction, and the specific rules are decided by the Board of UT Capital.

7. Adjustments

If UT Capital has undergone events such as capitalization of capital reserve, payment of bonus shares, sub-division or consolidation of share capital before the exercise of rights, the number of Options and exercise price shall be adjusted in accordance with the terms of the Scheme.
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8. Exercise condition of Share Option

The Participants shall issue a written notice to UT Capital 30 days prior to the exercise of Option. The consideration for exercising the Options shall be paid in cash or by cheque. The Participants shall bear the relevant tax burden incurred by exercising Options and purchasing Shares.

9. Miscellaneous

1) No voting rights are attached to the Options or Shares issued under the Scheme.
2) No Options issued under the Scheme may be transferred. Without the written consent from the Board of UT Capital, no shares obtained upon the exercise of Options may be transferred, and the first transferee of the share transfer shall be UT Capital.
3) All shares obtained upon the exercise of Options under the Scheme shall be entitled to dividends.
4) Participants shall strictly comply with relevant laws and regulations during the share transfer and bear related taxes.

The resolutions of the Board are set out below:
1. Approving the adoption of the Scheme of UT Capital.
2. Authorizing the Board of Directors of UT Capital to deal with all matters in connection with the adoption of the Scheme in accordance with relevant laws, regulations and opinions and advices from the regulatory authorities, within the framework and under the principles approved at the general meeting of the Company, and based upon the general principle of acting in the best interest of the Company, including but not limited to:
1) formation and adjustment of specific plans for the adoption of the Share Option Incentive Scheme of UT Capital in accordance with the applicable laws, regulations and relevant provisions from the regulatory authorities as well as resolutions passed at the general meeting of the Company for such purposes, and based on the actual conditions of the Company and UT Capital, including but not limited to, participants, timing of grant, conditions of grant, exercise price, number of exercisable options and relevant adjustments, etc;
2) dealing with all matters relating to the approval of the Scheme of UT Capital in accordance with the applicable rules, including but not limited to going through the domestic and overseas formalities for approval, filing, registration and reporting, as well as the preparation, amendment, delivering and execution of relevant materials, and disclosing the relevant information in accordance with the relevant laws, regulations and the listing rules of the exchanges on which the company's securities are listed;
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3) making relevant adjustments to matters relating to the adoption of the Scheme of UT Capital according to the opinions and changes in the policies of the regulatory authorities or the changes in market conditions, unless re-approval by the Shareholders at Shareholders' general meeting is otherwise required pursuant to relevant laws, regulations and the Articles of Association of the Company;
4) dealing with other matters in relation to the adoption of the Scheme for UT Capital; and
5) authorising the Board of Directors of UT Capital to authorise its authorised persons to deal specifically with all matters relating to the adoption of the Scheme jointly or separately on behalf of the Company pursuant to the resolution passed at the general meeting of the Company and the authorisation granted by the board of directors of the Company and UT Capital respectively.
The above authorisation shall be effective on and from the date when the Shareholders at the Shareholders' general meeting approve the resolution to the date when the Scheme of UT Capital ceases to be effective.

As UT Capital is an indirect wholly-owned subsidiary of the Company, the Scheme shall comply with Chapter 17 of the Listing Rules which stipulates that the Scheme is subject to the approval of shareholders.
A circular containing details of the above proposals (except the resignation of directors and senior management) together with the notice of the Shareholders' general meeting, will be dispatched to the Shareholders in due course.
By order of the Board

Chairman

Shanghai, the PRC
28 March 2014

As at the date of this announcement, the executive directors are Mr. WANG Kaiguo and Mr. LI Mingshan; the non-executive directors are Mr. ZHUANG Guowei, Mr. ZHOU Donghui, Mr. HE Jianyong, Mr. ZHANG Jianwei, Mr. XU Chao, Mr. WANG Hongxiang, Mr. LI Gewei and Mr. FENG Huang; and the independent non-executive directors are Mr. XIA Bin, Mr. CHEN Qiwei, Mr. ZHANG Huiquan, Mr. ZHANG Ming, Mr. DAI Genyou, Mr. LIU Cheeming and Mr. Xiao Suining.

* For identification purpose only

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