Tibet Water Resources : Adoption of Share Award Scheme

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.

Tibet Water Resources Ltd.

西 藏 水 資 源 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1115) ADOPTION OF SHARE AWARD SCHEME

The Board is pleased to announce that on 18 August 2017, the Board has approved the adoption of the Scheme. The purposes of the Scheme are to (i) encourage or facilitate the holding of Shares by the Selected Participants; (ii) encourage and retain certain individuals to work with the Group; and (iii) provide incentive for the Selected Participants to achieve performance goals.

Subject to the rules of the Scheme, the Board may, from time to time at its absolute discretion, select any Eligible Participant (excluding an Excluded Participant) to be a Selected Participant and: (a) grant new Restricted Shares or new Unrestricted Shares to be issued and allotted by the Company under its available general mandate on the relevant Grant Date to such Selected Participant, using funds of the Company subject to compliance with the Companies Law and the articles of association of the Company; or (b) grant existing Restricted Shares or existing Unrestricted Shares to be purchased by the Company from the market to such Selected Participant, using funds of the Company subject to compliance with the Companies Law and the articles of association of the Company. Any Grant Shares subscribed and/or purchased from the market shall be held by the Trustee upon trust for the relevant Selected Participants until such Grant Shares are vested in the relevant Selected Participants in accordance with the rules of the Scheme.

The Scheme does not constitute a share option scheme or an arrangement analogous to a share option scheme of the Company pursuant to Chapter 17 of the Listing Rules. It is a discretionary award scheme of the Company.

THE SCHEME

The Board is pleased to announce that it has approved the adoption of the Scheme on 18 August 2017. A summary of the principal terms of the Scheme is set out in this announcement:

Purpose

The purposes of the Scheme are to (i) encourage or facilitate the holding of Shares by the Selected Participants; (ii) encourage and retain certain individuals to work with the Group; and (iii) provide incentive for the Selected Participants to achieve performance goals.

Administration

The Scheme shall be administered by the Board in accordance with the rules of the Scheme. The Company shall appoint the Trustee to assist with the administration and vesting of the Grant Shares to be granted pursuant to the Scheme.

Duration

Subject to any early termination as may be determined by the Board pursuant to the rules of the Scheme, the Scheme shall be valid and effective for a period of ten (10) years commencing on the Adoption Date (the "Scheme Period").

Scheme Limit

In any Financial Year during the Scheme Period, the maximum number of Shares to be subscribed for and/or purchased by the Trustee pursuant to the Scheme shall not exceed ten (10) per cent of the issued share capital of the Company as at the beginning of such relevant Financial Year (the "Scheme Limit").

No account shall be taken into the calculation of the Scheme Limit of any Shares where the right to acquire such shares has been released or lapsed in accordance with the relevant provisions of the Scheme.

Where any award of Grant to a Selected Participant would result in the aggregate of:

1. the number of Grant Shares underlying all Grants (whether vested or not); and

2. the number of Shares issued and to be issued upon exercise of options (whether exercised or outstanding) under any share option scheme adopted by the Company from time to time,

granted to such Selected Participant in the 12-month period up to and including the date of award of such Grant exceeding one (1) per cent of the issued share capital of the Company as at the date of award of such Grant, the Grant shall be subject to approval by the shareholders of the Company in a general meeting.

Operation of the Scheme

Subject to the provisions of the rules of the Scheme, the Board may, from time to time at its absolute discretion, select any Eligible Participant (excluding an Excluded Participant) to be a Selected Participant and:

1. grant new Restricted Shares or new Unrestricted Shares to be issued and allotted by the Company under its available general mandate on the relevant Grant Date to such Selected Participant, using funds of the Company subject to compliance with the Companies Law and the articles of association of the Company; or

2. grant existing Restricted Shares or existing Unrestricted Shares to be purchased by the Company from the market to such Selected Participant, using funds of the Company subject to compliance with the Companies Law and the articles of association of the Company.

Where any Grant is proposed to be made to a Selected Participant who is a director, chief executive or substantial shareholder of the Company or any of their respective associates or any other connected person, such Grant must first be approved by the independent non-executive directors of the Company (excluding any independent non-executive director to whom the Grant is proposed to be made). The Company will comply with the applicable requirements of the Listing Rules in respect of any share purchases from the market and any Grants.

After the Board has determined the number of Grant Shares and the Selected Participants, it shall notify the Trustee and the Selected Participants on the Grant Date by way of issuing Grant Letters. Upon receipt of the Grant Letters, the Selected Participants are required to confirm their acceptance of the Grant and their securities account details for the purposes of effecting the transfer of the vested Shares to such Selected Participants by the Trustee by returning to the Trustee and the Board a notice of acceptance (the "Acceptance Notice") duly executed by them by the latest acceptance date as specified or defined in the relevant Grant Letters.

After the relevant Acceptance Notice has been duly received and, if required, the relevant approval for the listing and dealing of the relevant Grant Shares has been obtained from the Stock Exchange, the Trustee shall as soon as practicable after receipt of the Cash (as defined below) apply the same towards:

1. the subscription of the relevant Grant Shares. The Company shall within 7 business days upon receipt of such subscription money from the Trustee issue and allot (a) to the Trustee in respect of those Grant Shares which are Restricted Shares; and (b) to the relevant Selected Participants the relevant Grant Shares which are Unrestricted Shares, in script or scriptless form as the parties may agree; or

2. the purchase of the relevant Grant Shares from the market subject to market conditions and applicable rules and regulations.

The Trustee shall hold the Restricted Shares awarded until the Grant Shares to the relevant Selected Participants are vested in accordance with the rules of the Scheme.

The Board may also from time to time at its sole discretion but subject always to the rules of the Scheme, issue an instruction letter (the "Instruction Letter") to the Trustee to instruct the Trustee to (i) subscribe for new Shares to be issued and allotted by the Company under its available general mandate and/or (ii) purchase existing Shares from the market for the purposes of the Scheme and the Shares so subscribed for and/or purchased shall be kept for the time being in the pool of the Scheme as reserve for future awards of Grants in accordance with the rules of the Scheme.

After the relevant Instruction Letter has been duly received and, if required, the relevant approval for the listing and dealing of the relevant Shares has been obtained from the Stock Exchange, the Trustee shall as soon as practicable after receipt of the Cash (as defined below) apply the same towards:

1. the subscription of the relevant Shares. The Company shall within 7 business days upon receipt of such subscription money from the Trustee issue and allot to the Trustee the relevant Shares; or

2. the purchase of the relevant Shares from the market subject to market conditions and applicable rules and regulations.

The Board may, at any time during the Scheme Period and at its sole discretion, determine and procure the Company to pay to the Trustee such amount of cash required to fund the subscription and/or purchase of the aggregate number of Shares as stipulated in the Acceptance Notice(s) and/or Instruction Letter(s) ("Cash") as well as the related transaction costs and expenses, subject to an annual cap for the sum equal to the aggregate amount of the Company's distributable reserves as set out