Annual Report 2012 - ecoWise Holdings Limited

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148ecoWise Holdings Limitedannual report 2012ADDITIONAL EXPLANATORY STATEMENT TO ORDINARY RESOLUTION 9AS SET OUT IN THE NOTICE OF ANNUAL GENERAL MEETING(“ADDITIONAL EXPLANATORY STATEMENT”)Under the leadership of Mr Lee Thiam Seng, over the last three years the Group has diversified its businessportfolio in the Resource Recovery segment with the acquisition of Sunrich Integrated Sdn. Bhd. and itssubsidiaries in July 2010, a leading rubber compound manufacturing and tyre retreading group based inMalaysia. The Group has in March 2010 acquired a 15% interest in Chongqing Zhongtian Electronic WasteManagement Co., Ltd which holds an exclusive e-waste license for collection, recovering and disposal ofelectrical and electronic waste in Chongqing, China. The Group’s businesses under its Renewable Energysegment has also expanded with a new biomass co-generation plant at the Gardens by the Bay startedoperation since November 2011.As a result of the diversification and expansion plan, over the last three financial years from 1 November 2009to 31 October 2012 (i.e. FY2010 to FY2012), the Group’s revenue grew from S$37.59 million in FY2010 toS$90.52 million in FY2012 and the Group recorded a net profit of S$1.37 million in FY2012 as comparedto a loss of S$1.35 million in FY2010.The Directors are of the view that the remuneration package of Mr Lee Thiam Seng is fair given hiscontributions to the Company. The extension of the Share Plan to Mr Lee Thiam Seng is consistent withthe Company’s objectives to motivate its employees to achieve and maintain a high level of performanceand contribution which is vital to the success of the Company. Although Mr Lee Thiam Seng already has ashareholding interest in the Company, the extension of the Share Plan to him will ensure that he is equallyentitled, with the other employees who are not Controlling Shareholders, to take part in and benefit from thissystem of remuneration, thereby enhancing his long-term commitment to the Company. For the aforesaidreasons, the Directors believe that Mr Lee Thiam Seng deserves, and should be allowed to participate inthe Share Plan.Subject to Shareholders’ approval for Ordinary Resolution 9 as set out in the Notice of AGM at the AGM,the Company proposes to grant an Award of 2,000,000 Shares (“Proposed 2013 Award”) to Mr Lee ThiamSeng in accordance with the Share Plan and the proposed date of grant of Shares to be any time within1 year from the date of the AGM to be held on 28 February 2013.On 23 March 2007, Mr Lee Thiam Seng was awarded 1,500,000 fully paid-up ecoWise shares (“2007Award”) subject to achieving performance targets at the end of the financial year ending 31 October 2007and 31 October 2008 respectively under the Share Plan. 50% of the said grant or 3,442,500 fully paid-upecoWise shares (after adjusting for Rights cum Warrants Issues dated 7 November 2007) were vested andissued to Mr Lee Thiam Seng for the financial year ended 31 October 2007. The balance 50% of the saidgrant or 5,034,700 fully paid-up ecoWise shares (after adjusting for Rights cum Warrants Issues dated 7November 2007 and further Rights Issues dated 26 September 2008) were vested and issued to Mr LeeThiam Seng for the financial year ended 31 October 2008.
ecoWise Holdings Limitedannual report 2012ADDITIONAL EXPLANATORY STATEMENT TO ORDINARY RESOLUTION 9AS SET OUT IN THE NOTICE OF ANNUAL GENERAL MEETING(“ADDITIONAL EXPLANATORY STATEMENT”)149At the AGM held on 28 February 2008, shareholders had approved the Company’s grant of an Award of2,250,000 Shares to Mr Lee Thiam Seng and the date of grant of Shares to be any time within 5 years fromthe date of the EGM held on 23 March 2007. Subsequent to the AGM held on 28 February 2008, Mr LeeThiam Seng has been awarded a total of 2,250,000 fully paid-up ecoWise shares (“2008 Award”) (equivalentto 3,290,625 fully paid-up ecoWise shares after adjusting for Rights Issues dated 26 September 2008) subjectto achieving the performance targets over performance periods up to 31 January 2013 under the Share Plan.As at 29 January 2013 (“Latest Practicable Date”), a total of 2,193,750 fully paid-up ecoWise shares (afteradjusting for Rights Issues dated 26 September 2008) have been vested and issued to Mr Lee Thiam Sengfor performance periods ended 31 January 2011. The amount of ecoWise shares (after adjusting for RightsIssues dated 26 September 2008) that has been awarded but has not been vested pending satisfaction of theperformance targets for performance period ending 31 January 2013 is 1,096,875 (“Unvested 2008 Award”).Under the Listing Rules, the aggregate number of Shares which may be issued pursuant to Awards grantedunder the Share Plan on any date, when added to the number of new Shares issued and/or issuable inrespect of all Awards granted under the Share Plan and any other share scheme which the Company mayimplement from time to time, will not exceed 15% of the total issued Shares in the capital of the Company.As at the Latest Practicable Date, the total number of issued Shares is 924,158,877 Shares. The total numberof Shares available under the Share Plan as at the Latest Practicable Date would be 138,623,832 Shares,representing 15% of the total number of issued Shares. Accordingly, the total number of Shares available tothe controlling shareholders of the Company or their associates under the Share Plan is up to 34,655,958Shares, being 25% of the total number of Shares available under the Share Plan and the total number ofShares available to each controlling shareholder of the Company or his associate is up to 13,862,383 Shares,being 10% of the total number of Shares available under the Share Plan.For illustrative purposes, on the assumption that (i) there is no increase in the number of issued Shares; and(ii) the Company does not buy back or otherwise acquire any of its Shares, and (iii) the proposed grant ofUnvested 2008 Award to Mr Lee Thiam Seng is fully granted, the aggregate number of Shares to be awardedto Mr Lee Thiam Seng when aggregated with the 8,477,200 ecoWise shares vested and issued to him arisingfrom the 2007 Award, the 2,193,750 ecoWise shares vested and issued to him arising from the 2008 Award,the Unvested 2008 Award and Proposed 2013 Award would be 13,767,825 Shares, representing 9.93%of the number of Shares available under the Share Plan as at the Latest Practicable Date. Accordingly, theproposed grant of Award to Mr Lee Thiam Seng as set out in the proposed Ordinary Resolution 9 of theNotice of AGM would be within the limits prescribed under the Listing Manual.As at the Latest Practicable Date, the Company has not implemented any share-based incentive schemeother than the ecoWise Performance Share Plan.
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Annual Report 2012 - ecoWise Holdings Limited

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