China Everbright Water Limited

U9E

BMG2116Y1057

Water Utilities

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Apr. 26	China Everbright Water Limited Announces Cessation of Office of Cheng Fong Yee as Independent Non-Executive Director, Chairman of the Remuneration Committee and Member of the Audit Committee	CI
Apr. 26	China Everbright Water Limited Appoints Hao Gang as Chairman of the Remuneration Committee	CI

China Everbright Water : Proposed Renewal of General Mandate to Issue Shares, Proposed Renewal of the IPT Mandate, Proposed Renewal of the Share Buy-back Mandate, Proposed Re-election of Retiring Directors, Proposed Continued Appointment of Independent Directors, Proposed Re-appointment of the Company's Auditor and Notice of Annual General Meeting

March 22, 2021 at 05:19 am EDT

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this Circular, or as to the action to be taken, you should consult your stockbroker or a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all of your shares in the Company, you should immediately hand this Circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Singapore Exchange Securities Trading Limited assumes no responsibility for the correctness of any of the statements or opinions made or reports contained in this Circular.

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.

CHINA EVERBRIGHT WATER LIMITED ʕ਷Έɽ˥ਕϞࠢʮ̡

(Incorporated in Bermuda with limited liability)

(Hong Kong Stock Code: 1857) (Singapore Stock Code: U9E)

PROPOSED RENEWAL OF GENERAL MANDATE TO ISSUE SHARES

PROPOSED RENEWAL OF THE IPT MANDATE PROPOSED RENEWAL OF THE SHARE BUY-BACK MANDATE

PROPOSED RE-ELECTION OF RETIRING DIRECTORS

PROPOSED CONTINUED APPOINTMENT OF

INDEPENDENT DIRECTORS

PROPOSED RE-APPOINTMENT OF THE COMPANY'S AUDITOR

AND NOTICE OF ANNUAL GENERAL MEETING

A Notice convening the 2021 AGM to be held at 9:30 a.m. on Tuesday, 27 April 2021 at 37 Jalan Pemimpin #08-18 Mapex Singapore 577177 is set out on pages 66 to 78 of this Circular. The form of proxy for use at the 2021 AGM is also enclosed with this Circular.

Due to the current COVID-19 situation in Singapore, the 2021 AGM will be convened, and will be held, via electronic means in accordance with the COVID-19 (Temporary Measures) (Alternative Arrangements for Meetings for Companies, Variable Capital Companies, Business Trusts, Unit Trusts and Debenture Holders) Order 2020, and accordingly, the Shareholders will NOT be able to attend the 2021 AGM in person, and can only participate in the 2021 AGM via electronic means. You must either appoint the Chairman of the 2021 AGM as your proxy or (in the case of a Depositor) nominate the appointment of the Chairman of the 2021 AGM as CDP's proxy to attend, speak and vote on your behalf at the 2021 AGM or pre-register as a Shareholder to exercise your voting rights at the 2021 AGM via electronic means. If you wish to appoint the Chairman of the 2021 AGM as your proxy or (in the case of a Depositor) nominate the appointment of the Chairman of the 2021 AGM as CDP's proxy to attend, speak and vote at the 2021 AGM on your behalf, please complete and sign the accompanying form of proxy in accordance with the instructions printed thereon. For Singapore Shareholders, the Depositor Proxy Form appointing the Chairman of the 2021 AGM as proxy of CDP, duly completed, must be submitted by the Depositor in the following manner: if submitted by post, by depositing the duly completed Depositor Proxy Form at the office of the Company's Singapore Share Transfer Agent, Boardroom Corporate & Advisory Services Pte. Ltd., at 50 Raffles Place, #32-01 Singapore Land Tower Singapore 048623; or if submitted electronically, by scanning and submitting the duly completed Depositor Proxy Form via email to the Company 's Singapore Share Transfer Agent, Boardroom Corporate & Advisory Services Pte. Ltd., atCEWLAGM2021@boardroomlimited.com, in either case, at least 72 hours before the time for holding the 2021 AGM. For Hong Kong Shareholders, the instrument appointing the Chairman of the 2021 AGM as proxy must be submitted in the following manner: if submitted by post, by depositing the duly completed proxy form with the Company's Hong Kong Share Registrar and Transfer Office, Boardroom Share Registrars (HK) Limited, at 2103B, 21/F, 148 Electric Road, North Point, Hong Kong; or if submitted electronically, by scanning and submitting the duly completed proxy form via email to the Company's Hong Kong Share Registrar and Transfer Office, Boardroom Share Registrars (HK) Limited, atsrinfo.hk@boardroomlimited.com, in either case, at least 72 hours before the time for holding the 2021 AGM. In view of the current COVID-19 situation and the related safe distancing measures which may make it difficult for Shareholders to submit completed proxy forms by post, Shareholders are strongly encouraged to scan and submit the completed proxy forms electronically via email.

23 March 2021

In this Circular, the following expressions have the following meanings unless the context requires otherwise:

''Audit Committee''	the audit committee of the Company
''Bermuda Companies Act''	the Companies Act 1981 of Bermuda (as amended)
''Board''	the board of Directors
''Bye-laws''	the bye-laws of the Company
''CDP''	The Central Depository (Pte) Limited
''CEO''	chief executive officer of the Company
''Circular''	The definitions, the letter from the Board, the appendix to
the letter from the Board and the Notice
''Close Associate(s)''	has the meaning ascribed to it under the SEHK Listing
Rules
''Company''	China Everbright Water Limited (中國光大水務有限公司),
an exempted company incorporated in Bermuda with
limited liability, the Shares of which are listed on the
Mainboard of the SGX-ST and the Main Board of the
SEHK
''Core Connected Person''	has the meaning ascribed to it under the SEHK Listing
Rules
''Depositor''	has the meaning ascribed to it in Section 81SF of the SFA
''Depositor Proxy Form''	the enclosed depositor proxy form in respect of the 2021
AGM
''Depository Register''	has the meaning ascribed to it in Section 81SF of the SFA
''Director(s)''	the director(s) of the Company

''EAR Group''

(i) the Company;
(ii) subsidiaries of the Company (excluding subsidiaries listed on the SGX-ST or an approved exchange); and

''EPC''

(iii) associated companies of the Company (other than an associated company that is listed on the SGX-ST or an approved exchange) over which the Group, or the Group and interested person(s) of the Company has or have control engineering-procurement-construction, a project model in which an enterprise is commissioned by a customer to design, procure and construct a project and be responsible for the quality, safety, timing and pricing of the project according to the contract terms

''Everbright Environment''

China Everbright Environment Group Limited (中國光大環境(集團)有限公司)(formerly known as China Everbright International Limited ( 中國光大國際有限公司 )), a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Main Board of the SEHK (stock code: 257), the Company's controlling Shareholder

''Everbright Environment Group''

Everbright Environment and its subsidiaries, including the Group

''FY2020 Annual Report''

annual report of the Company for the financial year ended 31 December 2020

''FY2020 Results''

audited consolidated financial statements of the Group for the financial year ended 31 December 2020

''General Mandate''

a general and unconditional mandate to allot, issue or deal with Shares subject to and in accordance with the terms of the mandate

''Group''

the Company and its subsidiaries and, where the context requires, in respect of the period before the Company became the holding company of any of its present subsidiaries, such present subsidiaries of the Company, the businesses carried on by such subsidiaries and (as the case may be) their predecessors

''HKEX''

Hong Kong Exchange and Clearing Limited

''HK$'' or ''Hong Kong Dollar(s)''

Hong Kong dollar(s), the lawful currency of Hong Kong

''Hong Kong''

the Hong Kong Special Administrative Region of the People's Republic of China

''Hong Kong Takeovers Code''

The Hong Kong Code on Takeovers and Mergers

''Independent Non-executive

Directors''

Mr. Zhai Haitao, Mr. Lim Yu Neng Paul, Ms. Cheng Fong Yee and Ms. Hao Gang

''IPT Mandate''

The general mandate to enable the Company, its subsidiaries and associated companies that are entities at risk (as that term is used in Chapter 9 of the SGX-ST Listing Manual) to enter into certain interested person transactions with the interested persons as set out in the IPT Mandate

''Latest Practicable Date''

12 March 2021, being the latest practicable date prior to the printing of this Circular for ascertaining certain information contained herein

''Market Day(s)''

day(s) on which the SGX-ST or the SEHK (as the case may be) is open for trading in securities

''Market Purchases''

purchase or acquisition of Shares by the Company effected on the SGX-ST or the SEHK (as the case may be), through one or more duly licensed stockbrokers appointed by the Company for the purpose

''Mandated IPTs''

the categories of transactions set out in paragraph 6.1 of the Appendix to this Circular

''Maximum Price''

maximum purchase price to be paid for the Shares as determined by the Directors

''Nominating Committee''

the nominating committee of the Board

''Notice''

the notice of the annual general meeting of the Company dated 23 March 2021 convening the 2021 AGM

''Off-Market Purchases''

purchase or acquisition of Shares by the Company made under an equal access scheme or schemes for the purchase or acquisition of Shares from Shareholders

''Relevant Independent Directors''

Mr. Lim Yu Neng Paul, Ms. Cheng Fong Yee and Ms. Hao Gang

DEFINITIONS
''SEHK''	The Stock Exchange of Hong Kong Limited
''SEHK Listing Rules''	the Rules Governing the Listing of Securities on SEHK
''SFA''	Securities and Futures Act, Chapter 289 of Singapore
''SFO''	the Securities and Futures Ordinance, Chapter 571 of the
Laws of Hong Kong
''SG CG Code''	the Singapore Code of Corporate Governance 2018
''SG Take-over Code''	the Singapore Code on Take-overs and Mergers
''SGX-ST''	Singapore Exchange Securities Trading Limited
''SGX-ST Listing Manual''	listing manual of the SGX-ST
''Share(s)''	the ordinary share(s) of the Company
''Share Buy-back Mandate''	the mandate to enable the Company to purchase or
otherwise acquire its Shares
''Share Premium Account''	the share premium account of the Company
''Shareholder(s)''	the registered holders of the Shares, except where the
registered holder is CDP, (i) the term ''Shareholders'' in
relation to the Shares held by CDP shall, in relation to
such Shares, mean the persons named as Depositors in the
Depository Register maintained by CDP and whose
securities accounts are credited with the Shares and (ii) all
references to ''Shareholders'' exercising their rights shall
mean the Depositors exercising their rights as proxies or
representatives of the CDP
''Singapore''	the Republic of Singapore
''Singapore Companies Act''	the Companies Act, Chapter 50 of Singapore
''S$'' or ''Singapore dollar(s)''	Singapore dollar(s), the lawful currency of Singapore
''SSE''	Shanghai Stock Exchange

''subsidiary holdings''

Shares held by subsidiaries of the Company in the circumstances referred to in Sections 21(4), 21(4B), 21(6A) and 21(6C) of the Singapore Companies Act

''Substantial Shareholder''

in relation to the Company, a person who has an interest in one or more voting shares included in one of the classes of shares in the Company and the total votes attached to such share(s) is not less than five per cent. of the total votes attached to all the voting shares included in that class, as defined in the Securities and Futures Act, Chapter 289 of Singapore

''2020 AGM''

the annual general meeting of the Company held on 10 June 2020

''2020 Letter''

letter to Shareholders dated 23 March 2020

''2021 AGM''

the annual general meeting of the Company to be convened at 9:30 a.m. on Tuesday, 27 April 2021 at 37 Jalan Pemimpin #08-18 Mapex Singapore 577177.

''%''

per cent

Should there be any discrepancy between the English and Chinese versions of this Circular, the English version shall prevail.

CHINA EVERBRIGHT WATER LIMITED ʕ਷Έɽ˥ਕϞࠢʮ̡

(Incorporated in Bermuda with limited liability)

(Hong Kong Stock Code: 1857) (Singapore Stock Code: U9E)

Non-Executive Director:	Registered Office:
Mr. Wang Tianyi (Chairman)	Clarendon House
2 Church Street
Executive Directors:	Hamilton HM11
Mr. An Xuesong (Chief Executive Officer)	Bermuda
Mr. Luo Junling
Principal Place of
Independent Non-Executive Directors:	Business in Hong Kong:
Mr. Zhai Haitao	Room 3601, 36/F
Mr. Lim Yu Neng Paul	Far East Finance Centre
Ms. Cheng Fong Yee	16 Harcourt Road
Ms. Hao Gang	Hong Kong
23 March 2021
To: The Shareholders
Dear Sir/Madam

INTRODUCTION

1.1

We refer to:

1.1.1 the Notice;
1.1.2 Ordinary Resolution No. 10 relating to the proposed renewal of the General Mandate, as proposed in the Notice;
1.1.3 Ordinary Resolution No. 13 relating to the proposed renewal of the IPT Mandate, as proposed in the Notice;

1.1.4 Ordinary Resolution No. 12 relating to the proposed renewal of the Share Buy-back Mandate, as proposed in the Notice;
1.1.5 Ordinary Resolution No. 4a relating to the re-election of Mr. Lim Yu Neng Paul as a Director, as proposed in the Notice;
1.1.6 Ordinary Resolution Nos. 6 and 7 relating to the continued appointment of Mr. Lim Yu Neng Paul as an independent Director, as proposed in the Notice;
1.1.7 Ordinary Resolution No. 4b relating to the re-election of Ms. Cheng Fong Yee as a Director, as proposed in the Notice;
1.1.8 Ordinary Resolution Nos. 8 and 9 relating to the continued appointment of Ms. Cheng Fong Yee as an independent Director, as proposed in the Notice;
1.1.9 Ordinary Resolution No. 4c relating to the re-election of Mr. Zhai Haitao as a Director, as proposed in the Notice;
1.1.10 Ordinary Resolution No. 4d relating to the re-election of Ms. Hao Gang as a Director, as proposed in the Notice; and
1.1.11 Ordinary Resolution No. 5 relating to the re-appointment of Ernst & Young LLP as auditor of the Company, as proposed in the Notice.

1.2 Circular to Shareholders. The purpose of this Circular is to provide Shareholders with information relating to Ordinary Resolution Nos. 4(a), 4(b), 4(c), 4(d), 5, 6, 7, 8, 9, 10, 12 and 13 proposed in the Notice.
1.3 SGX-ST. The SGX-ST takes no responsibility for the accuracy of any statements made, opinions expressed or reports contained in this Circular.
1.4 SEHK. Hong Kong Exchanges and Clearing Limited and the SEHK 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 in this Circular.

1.5 Legal Adviser. With regard to the matters contemplated in this Circular, Allen & Gledhill LLP is the Singapore legal adviser to the Company and Li & Partners is the Hong Kong legal adviser to the Company.
1.6 Advice to Shareholders. Shareholders who are in any doubt as to the course of action should consult their broker, bank manager, solicitor, accountant or other professional advisers immediately.

2. THE PROPOSED RENEWAL OF GENERAL MANDATE

An ordinary resolution as set out in the Notice will be proposed at the 2021 AGM, pursuant to the Bye-laws, the SGX-ST Listing Manual and the SEHK Listing Rules, to seek the approval of the Shareholders to authorise and empower the Directors to:

(a) (i) allot and issue new Shares in the capital of the Company, whether by way of rights, bonus or otherwise;
- (ii) make or grant offers, agreements or options that might or would require Shares to be issued or other transferable rights to subscribe for or purchase Shares (collectively, ''Instruments'') including but not limited to the creation and issue of warrants, debentures or other instruments convertible into Shares; and/or
- (iii) issue additional instruments arising from adjustments made to the number of Instruments previously issued in the event of rights, bonus or capitalisation issue,
at any time to such persons and upon such terms and for such purposes as the Directors may, in their absolute discretion, deem fit; and
(b) (notwithstanding the authority conferred by the Shareholders may have ceased to be in force) issue Shares in pursuance of any Instrument made or granted by the Directors while such authority was in force;

provided always, that subject to any applicable regulations as may be prescribed by the SGX-ST and the SEHK,

(i) the aggregate number of Shares to be issued pursuant to this resolution

(including Shares to be issued in pursuance of Instruments made or granted pursuant to this resolution) does not exceed 50% of the total number of issued

Shares excluding treasury shares of the Company, of which the aggregate number of Shares (including Shares to be issued in pursuance of Instruments made or granted pursuant to this resolution) to be issued other than on a pro rata basis to existing Shareholders does not exceed 20% of the total number of issued Shares excluding treasury shares of the Company, and for the purpose of this resolution, the issued Shares shall be the Company's total number of issued Shares excluding treasury shares at the time this resolution is passed, after adjusting for:

(a) new Shares arising from the conversion or exercise of any convertible securities; or
(b) new Shares arising from exercising share options or vesting of share awards outstanding or subsisting at the time this resolution is passed provided the options or awards were granted in compliance with Part VIII of Chapter 8 of the SGX-ST Listing Manual and Chapter 13 of the SEHK
Listing Rules; and
(c) any subsequent bonus issue, consolidation or subdivision of Shares; and

(ii) in exercising the authority conferred by this resolution, the Company shall comply with the provisions of the SGX-ST Listing Manual as amended from time to time (unless such compliance has been waived by the SGX-ST), the
SEHK Listing Rules as amended from time to time (unless such compliance has been waived by the SEHK) and the Bye-laws; and
(iii) such authority shall, unless revoked or varied by the Company at a general meeting, continue in force until the conclusion of the next annual general meeting or the date by which the next annual general meeting of the Company is required by law to be held, whichever is earlier.

Notwithstanding the above, it must be noted that the SEHK Listing Rules provide that the

General Mandate obtained from Shareholders in a general meeting shall be subject to a restriction that the aggregate number of Shares allotted or agreed to be allotted and issued under the General Mandate must not exceed 20% of the existing issued Shares. The Company will comply with the requirements under the SEHK Listing Rules or the SGX-ST

Listing Manual for matters relating to the General Mandate, whichever is more onerous.

As at the Latest Practicable Date, the Company had 2,860,876,723 Shares in issue and the maximum number of new Shares that can be allotted and issued (regardless of whether the Shares are issued to the Shareholders on a pro-rata basis) is 572,175,344 Shares, being 20% of the Shares in issue (assuming no Share is allotted and issued or repurchased after the Latest Practicable Date and up to the passing of the relevant resolution).

The grant of the General Mandate will provide flexibility to the Directors to allot and issue new Shares when it is in the interest of the Company.

3. THE PROPOSED RENEWAL OF THE IPT MANDATE

3.1 Background. At the 2020 AGM, Shareholders had approved the renewal of the IPT Mandate. Particulars of the IPT Mandate were set out in the Appendix to the 2020 Letter.
The IPT Mandate which was renewed at the 2020 AGM was expressed to continue in force until the next annual general meeting of the Company and, as such, will be expiring on 27 April 2021, being the date of the 2021 AGM. Accordingly, Shareholders' approval is being sought for the renewal of the IPT Mandate at the 2021 AGM, to take effect until the conclusion of the next annual general meeting of the Company which is scheduled to be held in 2022.
3.2 Rationale. It is envisaged that in the ordinary course of their businesses, transactions between companies in the EAR Group and the Company's interested persons are likely to occur from time to time. Such transactions are necessary for the day-to-day operations of the EAR Group and would include, but are not limited to, the provision of goods, facilities and services in the ordinary course of business of the EAR Group to the Company's interested persons or the obtaining of goods, facilities and services from them.
In particular, China Everbright Group Ltd., the Company's indirect controlling shareholder, is a major financial holding group in China, with business presence in various industries and sectors. Its business areas include, amongst others, banking, securities, insurance, funds, trusts, futures, leasing, investment, environmental protection, hospitalism and pharmaceutical. The EAR Group may leverage on China Everbright Group Ltd.'s and its associates' wide spectrum of businesses and rich resources to support its future development. Some of China Everbright Group Ltd.'s major subsidiaries include:
(a) Everbright Environment, a one-stop integrated environmental solution provider listed on the SEHK;

(b) China Everbright Limited, an investment holding company principally engaged in fund management and investment business and listed on the SEHK;
(c) China Everbright Bank Co., Ltd., a commercial bank listed on the SSE and the SEHK;
(d) Everbright Securities Company Limited, a securities brokerage company listed on the SSE and the SEHK; and
(e) Sun Life Everbright Life Insurance Co., Ltd., an insurance company which has branches in various provinces and municipalities in China.

In view of the time-sensitive nature of commercial transactions, the renewal of the IPT Mandate pursuant to Chapter 9 of the SGX-ST Listing Manual will enable the EAR Group, or any of them, in the ordinary course of their businesses, to enter into the Mandated IPTs with the Company's interested persons set out in paragraph 5.1 of the Appendix to this Circular, provided such Mandated IPTs are made on normal commercial terms.

3.3 Benefit to Shareholders. The IPT Mandate (and its subsequent renewal thereafter on an annual basis) will enhance the ability of companies in the EAR Group to pursue business opportunities which are time-sensitive in nature, and will eliminate the need for the Company to announce, or to announce and convene separate general meetings on each occasion to seek Shareholders' prior approval for the entry by the relevant company in the EAR Group into such transactions. This will substantially reduce the expenses associated with the convening of general meetings on an ad hoc basis, improve administrative efficacy considerably, and allow manpower resources and time to be channelled towards attaining other corporate objectives.
3.4 Terms of the IPT Mandate. The IPT Mandate, including the review procedures for determining transaction prices and other general information relating to Chapter 9 of the SGX-ST Listing Manual, is set out in the Appendix to this Circular. The terms of the IPT Mandate which is sought to be renewed remain unchanged.
3.5 Audit Committee's Statement. The Audit Committee (save for Mr. Zhai Haitao), comprising Mr. Lim Yu Neng Paul, Ms. Cheng Fong Yee and Ms. Hao Gang, confirms that:
(a) the methods or procedures for determining the transaction prices under the IPT Mandate have not changed since the 2020 AGM; and

(b) the methods or procedures referred to in paragraph 3.5(a) above are sufficient to ensure that the transactions will be carried out on normal commercial terms and will not be prejudicial to the interests of the Company and its minority Shareholders.

4. THE PROPOSED RENEWAL OF THE SHARE BUY-BACK MANDATE

4.1 Background. At the 2020 AGM, Shareholders had approved the renewal of the Share Buy-back Mandate. The authority and limitations of the Share Buy-back Mandate were set out in the 2020 Letter and the ordinary resolution in the notice of the 2020 AGM. The Share Buy-back Mandate approved at the 2020 AGM was expressed to continue in force until the next annual general meeting of the Company and, as such, will be expiring on 27 April 2021, being the date of the 2021 AGM. Accordingly, Shareholders' approval is being sought for the renewal of the Share Buy-back Mandate at the 2021 AGM.
4.2 Market Purchases. As at the Latest Practicable Date, the Company had not purchased or acquired any Shares by way of Market Purchases in the preceding 12 months pursuant to the Share Buy-Back Mandate approved by Shareholders at the 2020 AGM.
4.3 Rationale. The Share Buy-back Mandate will give the Company the flexibility to undertake purchases or acquisitions of its Shares at any time, subject to market conditions, during the period that the Share Buy-back Mandate is in force. Share purchases or acquisitions allow the Company greater flexibility over its share capital structure with a view to improving, inter alia, its return on equity.
It should be noted that the purchase or acquisition of Shares pursuant to the Share Buy-back Mandate will only be undertaken if it can benefit the Company and Shareholders. No purchase or acquisition of Shares will be made in the circumstances which would have or may have a material adverse effect on the financial position of the Group, and/or affect the listing status of the Company on the SGX-ST or the SEHK. In addition, any purchase or acquisition of its Shares has to be made in accordance with, and in the manner prescribed by the Bermuda Companies Act, the Bye-laws, the SGX-ST Listing Manual, the SEHK Listing Rules and such other laws and regulations as may, for the time being, be applicable.

4.4 Authority and Limitations. The authority and limitations on the purchase or acquisition of Shares by the Company under the Share Buy-back Mandate are summarised below.

4.4.1 Maximum number of Shares

The total number of Shares which may be purchased or acquired by the Company pursuant to the Share Buy-back Mandate is limited to that number of Shares representing not more than 10 per cent. of the total number of issued Shares (excluding any Shares held by the Company as treasury shares and any subsidiary holdings) as at the date of the 2021 AGM. Under the SGX-ST Listing Manual, treasury shares and subsidiary holdings are to be disregarded for purposes of computing the 10 per cent. limit.

As at the Latest Practicable Date, no Shares were held as treasury shares and there are no subsidiary holdings. Purely for illustrative purposes, on the basis that the total number of issued Shares is 2,860,876,723 as at the Latest Practicable Date and assuming that between the Latest Practicable Date and the date of the 2021 AGM (i) no new Shares are issued, (ii) no Shares are held as treasury shares, and (iii) no Shares are subsidiary holdings, then not more than 286,087,672 Shares (representing 10 per cent. of the total number of issued Shares as at the approval date) may be purchased or acquired by the Company pursuant to the Share Buy-back Mandate.

4.4.2

Duration of authority

Purchases or acquisitions of Shares may be made, at any time and from time to time, on and from the date of the 2021 AGM, at which the Share Buy-back Mandate is approved, up to:

(i) the date (being a date after the 2021 AGM) on which the next annual general meeting of the Company is held or required by law to be held;

(ii) the date (being a date after the 2021 AGM) on which the authority conferred by the Share Buy-back Mandate is revoked or varied by the Company in a general meeting; or
(iii) the date (being a date after the 2021 AGM) on which the purchases or acquisitions of Shares pursuant to the Share Buy-back Mandate are carried out to the full extent mandated,

whichever is the earliest.

4.4.3 Manner of purchase or acquisition of Shares

Purchases or acquisitions of Shares may be made by way of:

(i) Market Purchases; and/or
(ii) Off-Market Purchases.

The Directors may impose such terms and conditions which are not inconsistent with the Share Buy-back Mandate, the SGX-ST Listing Manual, the SEHK Listing Rules, the Bermuda Companies Act and the Bye-laws, as they consider fit in the interests of the Company in connection with or in relation to any equal access scheme or schemes. As required under the SGX-ST Listing Manual, an Off-Market Purchase must, however, also satisfy all the following conditions prescribed by the Singapore Companies Act:

(a) offers for the purchase or acquisition of Shares shall be made to every person who holds Shares to purchase or acquire the same percentage of their Shares;
(b) all of those persons shall be given a reasonable opportunity to accept the offers made; and
(c) the terms of all the offers shall be the same, except that there shall be disregarded:
- (1) differences in consideration attributable to the fact that offers may relate to Shares with different accrued dividend entitlements;
- (2) (if applicable) differences in consideration attributable to the fact that the offers relate to Shares with different amounts remaining unpaid; and
- (3) differences in the offers introduced solely to ensure that each person is left with a whole number of Shares.

Additionally, the SGX-ST Listing Manual provides that, in making an Off-Market Purchase, the Company must issue an offer document to all Shareholders which must contain, inter alia, the following information:

(A) the terms and conditions of the offer;
(B) the period and procedures for acceptances;

(C) the reasons for the proposed Share purchases;
(D) the consequences, if any, of Share purchases by the Company that will arise under the SG Take-over Code or other applicable takeover rules;
(E) whether the Share purchases, if made, would have any effect on the listing of the Shares on the SGX-ST;
(F) details of any Share purchases made by the Company in the previous 12 months (whether Market Purchases or Off-Market Purchases), giving the total number of Shares purchased, the purchase price per Share or the highest and lowest prices paid for the purchases, where relevant, and the total consideration paid for the purchases; and
(G) whether the Shares purchased by the Company will be cancelled or kept as treasury shares.

4.4.4 Purchase Price

The purchase price (excluding brokerage, commission, applicable goods and services tax and other related expenses) to be paid for a Share will be determined by the Directors. However, the Maximum Price must not exceed:

(i) in the case of a Market Purchase, five per cent. above the Average Closing Price; and
(ii) in the case of an Off-Market Purchase, five per cent. above the Average Closing Price,

in either case, excluding related expenses of the purchase or acquisition. For the above purposes:

''Average Closing Price'' means the average of the closing market prices of the Shares over the last five Market Days on which the Shares were transacted on the SGX-ST or the SEHK (as the case may be), before the date of the Market Purchase by the Company, or as the case may be, the date of the making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted in accordance with the SGX-ST Listing Manual or the SEHK Listing Rules (as the case may be) for any corporate action which occurs during the relevant five-day period and the day on which the purchases are made; and

''date of the making of the offer'' means the date on which the Company makes an offer for an Off-Market Purchase, stating therein the purchase price (which shall not be more than the Maximum Price for an Off-Market Purchase calculated on the foregoing basis) for each Share and the relevant terms of the equal access scheme for effecting the Off-Market Purchase.

4.4.5 Solvency Test

Under the Bermuda Companies Act, no purchase by the Company of its own shares may be effected if, on the date on which the purchase is to be effected, there are reasonable grounds for believing that the Company is, or after the purchase would be, unable to pay its liabilities as they become due.

4.5 Status of Purchased or Acquired Shares. Under Bermuda Companies Act, the Shares purchased or acquired by the Company shall be treated as cancelled immediately upon purchase or acquisition, unless such Shares are held continuously since they were purchased or acquired by the Company as treasury shares. Upon cancellation of the Shares, the total issued capital of the Company will be diminished by the nominal value of the Shares purchased or acquired by the Company. The Shares purchased or acquired by the Company shall not be taken as reducing the amount of the Company's authorised share capital.
4.6 Treasury Shares. As at the Latest Practicable Date, the Company does not hold any treasury shares.
4.7 Source of Funds. In purchasing or acquiring Shares pursuant to the Share Buy-back Mandate, the Company may only apply funds legally available for such purchase or acquisition in accordance with the Bye-laws and applicable laws. Under the Bermuda Companies Act, any payment made by the Company in consideration of the purchase or acquisition of its Shares may be made out of the capital paid up thereon or out of the funds of the Company which would otherwise be available for dividend or distribution or out of the proceeds of a fresh issue of Shares made for the purposes of the repurchase or acquisition. The premium, if any, payable on repurchase or acquisition of Shares, is to be provided for out of funds of the Company which would otherwise be available for dividend or distribution or out of the Share Premium Account before the Shares are repurchased or acquired. The Company intends to use internal sources of funds, external borrowings, or a combination of internal resources and external borrowings, to finance purchases or acquisitions of its Shares. The Directors do not propose to exercise the Share Buy-back Mandate to such extent that it would materially affect the working capital requirements, financial flexibility or investment ability of the Group.

4.8 Financial Effects. The financial effects on the Group arising from purchases or acquisitions of Shares which may be made pursuant to the Share Buy-back Mandate will depend on, inter alia, the manner in which the purchase or acquisition is funded, the aggregate number of Shares purchased or acquired and the consideration paid at the relevant time. The financial effects on the Group based on the FY2020 Results are based on the assumptions set out below.

4.8.1 Manner in which the Purchase or Acquisition is Funded

Under the Bermuda Companies Act, any payment made by the Company in consideration of the purchase or acquisition of its Shares may be made out of the capital paid up thereon or out of the funds of the Company which would otherwise be available for dividend or distribution or out of the proceeds of a fresh issue of Shares made for the purposes of the repurchase or acquisition. The premium, if any, payable on repurchase or acquisition of Shares, is to be provided for out of funds of the Company which would otherwise be available for dividend or distribution or out of the Share Premium Account before the Shares are repurchased or acquired.

Where any payment made by the Company in consideration of the purchase or acquisition of Shares is made out of the capital paid up thereon or out of the proceeds of a fresh issue of Shares made for the purposes of the repurchase or acquisition, the amount available for declaration and payment of cash dividends by the Company will not be reduced.

Where any payment made by the Company in consideration of the purchase or acquisition of Shares is made out of funds of the Company which would otherwise be available for dividend or distribution, such consideration (excluding brokerage, commission, applicable goods and services tax and other related expenses) will correspondingly reduce the amount available for declaration and payment of cash dividends by the Company.

4.8.2 Maximum Price Paid for Shares Acquired or Purchased

Based on 2,860,876,723 issued Shares as at the Latest Practicable Date, the purchase by the Company of 10 per cent. of such Shares will result in the purchase or acquisition of 286,087,672 Shares.

Assuming that the Company purchases or acquires the 286,087,672 Shares on the SGX-ST at the Maximum Price on the Latest Practicable Date, the maximum amount of funds required is approximately:

(i) in the case of Market Purchases, S$72,380,181 based on S$0.253 for each Share (being the price equivalent to five per cent. above the Average Closing Price of the Shares traded on the SGX-ST over the last five Market Days preceding the Latest Practicable Date); and
(ii) in the case of Off-Market Purchases, S$72,380,181 based on S$0.253 for each Share (being the price equivalent to five per cent. above the Average Closing Price of the Shares traded on the SGX-ST over the last five Market Days preceding the Latest Practicable Date).

4.8.3

For illustrative purposes only, on the basis of the assumptions set out above as well as the following:

(i) the Share Buy-back Mandate had been effective on 1 January 2020;

(ii) the purchase of Shares took place at the beginning of the financial year on 1 January 2020;
(iii) there was no issuance of Shares after the Latest Practicable Date; and
(iv) the Share purchases were funded by internal resources and/or external borrowings,

the financial effects on the FY2020 Results would have been as follows:Purchases made equally out of profits (5%) and capital (5%) and all cancelled(1)

After
Share
Buy-back	Buy-back
HK$'000	HK$'000	HK$'000(2)
As at 31 December 2020
Shareholders' Funds(3)	10,534,293	10,631,219	10,201,267
Net Asset Value	11,405,859	10,631,219	10,201,267
Total Assets	26,907,534	17,814,929	17,802,406
Total Liabilities	15,501,675	7,183,710	7,601,139
Total Borrowings(4)	11,078,133	7,084,457	7,501,886
Profit Attributable to Equity Holders(5)	1,024,271	211,187	198,664
Number of Shares ('000)
Issued and Paid-up Share Capital	2,860,877	2,860,877	2,574,789
Weighted Average Number of Issued and Paid-
up Shares	2,860,877	2,860,877	2,574,789
Financial Ratios
Net Asset Value per Share (HK$)	3.68	3.72	3.96
Earnings per Share (HK$)	0.358	n.m.(6)	n.m.(6)
Gearing Ratio(7)	58%	40%	43%
Notes:

GROUP	COMPANY
Before	Before
Share	Share
Buy-back

After

Share Buy-back HK$'000(2)

10,104,341

10,975,907

26,895,011

15,919,104

11,495,562

1,011,748

2,574,789

3.92 0.393 59%

(1)	The disclosed financial effects remain the same irrespective of whether the purchase of Shares
is made by way of Market Purchases or Off-Market Purchases.
(2)	Assumes that the Company purchases the maximum limit of 286,087,672 Shares at the
Maximum Price of S$0.253 per Share (being the price equivalent to five per cent. above the
Average Closing Price of the Shares traded on the SGX-ST over the last five Market Days
preceding the Latest Practicable Date).
(3)	''Shareholders' Funds'' means the aggregate amounts of Share Capital, Share Premium,
foreign currency translation reserve, statutory reserve, contributed surplus reserve, other
reserves and retained earnings.
(4)	''Total Borrowings'' means short term and long term borrowings.
LETTER FROM THE BOARD
(5)	''Profit Attributable to Equity Holders'' after Share Buy-back has been adjusted by the
notional interest expense incurred at the interest rate of three per cent. per annum less
taxation.
(6)	''n.m.'' means not meaningful.
(7)	''Gearing Ratio'' represents the ratio of total liabilities to total assets.

SHAREHOLDERS SHOULD NOTE THAT THE FOREGOING FINANCIAL EFFECTS ARE BASED ON THE FY2020 RESULTS AND THE ABOVE ASSUMPTIONS AND ARE FOR ILLUSTRATION ONLY. THE FY2020 RESULTS MAY NOT BE REPRESENTATIVE OF FUTURE PERFORMANCE.

It should be noted that although the Share Buy-back Mandate would authorise the Company to purchase or acquire up to 10 per cent. of the total number of issued Shares, the Company may not necessarily purchase or acquire or be able to purchase or acquire the entire 10 per cent. In addition, the Shares purchased or acquired by the Company shall be treated as cancelled immediately or be held by the Company as treasury shares upon purchase or acquisition. The Company will take into account both financial and non-financial factors (for example, stock market conditions and the performance of the Shares) in assessing the relative impact of a Share purchase before execution.

4.9 Taxation. Shareholders who are in doubt as to their respective tax positions or any tax implications, or who may be subject to tax in a jurisdiction outside Singapore or Hong Kong, should consult their own professional advisers.

4.10 Listing Status of the Shares under the SGX-ST Listing Manual and the SEHK

Listing Rules. The SGX-ST Listing Manual requires a listed company to ensure that at least 10 per cent. of the total number of its issued shares (excluding treasury shares, subsidiary holdings, preference shares and convertible equity securities) in a class that is listed is held by public shareholders at all times.

As at the Latest Practicable Date, approximately 27.05 per cent. of the total number of Shares are held by public Shareholders. Accordingly, the Company is of the view that there is a sufficient number of the Shares in issue held by public Shareholders which would permit the Company to undertake purchases or acquisitions of its Shares through Market Purchases and/or Off-Market Purchases up to the full 10 per cent. limit pursuant to the Share Buy-back Mandate without affecting the listing status of the Shares on the SGX-ST. The Company will consider investor interests when maintaining a liquid market in its securities and will ensure that there is a sufficient float for an orderly market in its securities when purchasing its Shares.

Under the SEHK Listing Rules

The SEHK Listing Rules prohibit a company from making repurchase on the SEHK if the result of the repurchase would be that less than 25% (or such other prescribed minimum percentage as determined by the SEHK) of the issued Shares would be in public hands. The Company has no present intention to exercise the Share Buy-back Mandate to such extent which would otherwise result in the number of Shares being held by the public falling below such minimum requirement.

An issuer shall not purchase its shares on the SEHK at any time after inside information has come to its knowledge until the information is made publicly available. In particular, during the period of one month immediately preceding the earlier of (a) the date of the board meeting (as such date is first notified to the SEHK in accordance with the SEHK Listing Rules) for the approval of the issuer's results for any year, half-year, quarterly or any other interim period (whether or not required under the SEHK Listing Rules); and (b) the deadline for the issuer to announce its results for any year or half-year under the SEHK Listing Rules, or quarterly or any other interim period (whether or not required under the SEHK Listing Rules), and ending on the date of the results announcement, the issuer may not purchase its shares on the SEHK, unless the circumstances are exceptional. Further, an issuer shall not knowingly purchase its shares from a Core Connected Person and a Core Connected Person shall not knowingly sell shares to the issuer, on the SEHK.

In undertaking any purchases or acquisitions of the Shares, the Directors will use their best efforts to ensure that, notwithstanding such Share purchases or acquisitions, a sufficient float in the hands of the public will be maintained so that the Share purchases or acquisitions will not adversely affect the listing status of the Shares on the SEHK, cause market illiquidity or adversely affect the orderly trading of the Shares.

4.11 SGX-ST Listing Manual. The SGX-ST Listing Manual restricts a listed company from purchasing shares by way of market purchases at a price per share which is more than five per cent. above the ''average closing price'', being the average of the closing market prices of the shares over the last five Market Days on which transactions in the shares were recorded, before the day on which the purchases were made, and deemed to be adjusted for any corporate action that occurs during the relevant five-day period and the day on which the purchases are made. The Maximum Price for a Share in relation to Market Purchases referred to in paragraph 4.4.4(i) above complies with this requirement. Although the SGX-ST Listing Manual does not prescribe a maximum price in relation to purchases of shares by way of off-market purchases, the Company has set a cap of five per cent. above the Average Closing Price as the maximum price for a Share to be purchased or acquired by way of an Off-Market Purchase.

The Company will not undertake any purchase or acquisition of Shares pursuant to the

Share Buy-back Mandate at any time after any matter or development of a price sensitive nature has occurred or has been the subject of consideration and/or a decision of the Board until such price sensitive information has been publicly announced. In particular, the Company will not purchase or acquire any Shares during the period commencing one month before the announcement of the Company's half year and full year results.

4.12 Reporting Requirements. The SGX-ST Listing Manual specifies that a listed

company shall report all purchases or acquisitions of its shares to the SGX-ST not later than 9.00 a.m. (i) in the case of a Market Purchase, on the Market Day following the day of purchase or acquisition of any of its shares and (ii) in the case of an Off-Market Purchase, on the second Market Day after the close of acceptances of the offer. Such announcement (which must be in the form prescribed by the SGX-ST

Listing Manual) must include details of the date of the purchase, the total number of shares purchased, the number of shares cancelled, the number of shares held as treasury shares, the purchase price per share or the highest and lowest prices paid for such shares, as applicable, the total consideration (including stamp duties and clearing charges) paid or payable for the shares, the number of shares purchased as at the date of announcement (on a cumulative basis), the number of shares excluding treasury shares and subsidiary holdings, the number of treasury shares held after the purchase and the number of subsidiary holdings after the purchase.

Under the SEHK Listing Rules, after a listed issuer has made a purchase of its shares whether on the SEHK or otherwise, the listed issuer shall:

(a) submit for publication to the SEHK not later than 30 minutes before the earlier of the commencement of the morning trading session or any pre-opening session on the business day following any day on which the issuer makes a purchase or acquisition of shares (whether on the SEHK or otherwise), the total number of shares purchased or acquired by the issuer on the previous day, the purchase price per share or the highest and lowest prices paid for such purchases or acquisitions of shares which were made on the SEHK were made in accordance with the SEHK Listing Rules and if the issuer's primary listing is on the SEHK, that there have been no material changes to the particulars contained in the explanatory statement issued by the listed issuer in relation to the mandate pursuant to which such purchase or acquisition of shares is made. In respect of purchases or acquisitions of shares made on another stock exchange, the issuer's report must confirm that those purchases were made in accordance with the domestic rules applying to purchases on that other stock exchange. Such reports shall be made on a return in such form and containing such information as the SEHK may from time to time prescribe. In the event that no shares are purchased on any particular day then no return need be made to the SEHK; and

(b) include in its annual report and accounts a monthly breakdown of purchases of shares made during the financial year under review showing the number of shares purchased each month (whether on the SEHK or otherwise) and the purchase price per share or the highest and lowest price paid for all such purchases, where relevant, and the aggregate price paid by the issuer for such purchases. The section headed ''Directors' Statement'' in the annual report shall contain reference to the purchases made during the year and the reasons for making such purchases.

4.13 Take-over Implications under the SG Take-over Code. Appendix 2 of the SG Take-over Code contains the Share Buy-back Guidance Note. The take-over implications arising from any purchase or acquisition by the Company of its Shares are set out below.

4.13.1 Obligation to make a Take-over Offer
If, as a result of any purchase or acquisition by the Company of its Shares, the proportionate interest in the voting capital of the Company of a Shareholder and persons acting in concert with him increases, such increase will be treated as an acquisition for the purposes of Rule 14 of the SG Take-over Code. Consequently, a Shareholder or a group of Shareholders acting in concert with a Director could obtain or consolidate effective control of the Company and become obliged to make an offer under Rule 14 of the SG Take-over Code.
4.13.2 Persons Acting in Concert
Under the SG Take-over Code, persons acting in concert comprise individuals or companies who, pursuant to an agreement or understanding (whether formal or informal), co-operate, through the acquisition by any of them of shares in a company to obtain or consolidate effective control of that company.
In addition, under the SG Take-over Code, certain persons are presumed to be acting in concert with each other, unless the contrary is established. For example, the following individuals and companies will be presumed to be acting in concert with each other:
(i) the following companies:
- (a) a company;
- (b) the parent company of (a);

(c) the subsidiaries of (a);
(d) the fellow subsidiaries of (a);
(e) the associated companies of any of (a), (b), (c) or (d);
(f) companies whose associated companies include any of (a), (b), (c), (d) or (e); and
(g) any person who has provided financial assistance (other than a bank in the ordinary course of business) to any of the foregoing companies for the purchase of voting rights; and

(ii) a company with any of its directors (together with their close relatives, related trusts as well as companies controlled by any of the directors, their close relatives and related trusts).

The circumstances under which Shareholders, including Directors and persons acting in concert with them respectively, will incur an obligation to make a take-over offer under Rule 14 of the SG Take-over Code after a purchase or acquisition of Shares by the Company are set out in Appendix 2 to the SG Take-over Code.

4.13.3 Effect of Rule 14 and Appendix 2

In general terms, the effect of Rule 14 and Appendix 2 of the SG Take-over Code is that, unless exempted, Directors and persons acting in concert with them will incur an obligation to make a take-over offer under Rule 14 if, as a result of the Company purchasing or acquiring Shares, the voting rights of such Directors and their concert parties would increase to 30 per cent. or more, or in the event that such Directors and their concert parties hold between (and including) 30 per cent. and 50 per cent. of the Company's voting rights, if the voting rights of such Directors and their concert parties would increase by more than one per cent. in any period of six months. In calculating the percentages of voting rights of such Directors and their concert parties, treasury shares shall be excluded.

Under Appendix 2 of the SG Take-over Code, a Shareholder not acting in concert with the Directors will not be required to make a take-over offer under Rule 14 of the SG Take-over Code if, as a result of the Company purchasing or acquiring its Shares, the voting rights of such Shareholder would increase to 30 per cent. or more, or, if such Shareholder holds between (and including) 30 per cent. and 50 per cent. of the Company's voting rights, the voting rights of such Shareholder would increase by more than one per cent. in any period of six months. Such Shareholder need not abstain from voting in respect of the resolution authorising the Share Buy-back Mandate.

Based on the interests of the Substantial Shareholders as recorded in the Register of Substantial Shareholders as at the Latest Practicable Date as set out in paragraph 5.3 below, none of the Substantial Shareholders would become obliged to make a take-over offer for the Company under Rule 14 of the SG Take-over Code as a result of the purchase by the Company of the maximum limit of 10 per cent. of its issued Shares as at the Latest Practicable Date.

4.14 Take-over Implications under the Hong Kong Takeovers Code

If a Shareholder's proportionate interest in the voting rights of the Company increases on the Company exercising its powers to repurchase Shares pursuant to the Share Buy-back Mandate, such an increase will be treated as an acquisition for the purpose of Rule 32 of the Hong Kong Takeovers Code. As a result, a Shareholder or a group of Shareholders acting in concert could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 of the Hong Kong Takeovers Code. As at the Latest Practicable Date, the Directors are not aware of any Shareholders, or a group of Shareholders acting in concert, who may become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Hong Kong Takeovers Code in the event that the Directors exercise the power to repurchase Shares pursuant to the Share Buy-back Mandate.

As at the Latest Practicable Date, so far as the Directors are aware, the following Shareholders are interested in 5% or more of the Shares then in issue:

Approximate percentage of shareholdings

Number ofApproximate percentage of shareholdings in the Company as at the Latest

Name of Substantial ShareholdersNature of Interest

Shares interested

Practicablein the Company after the Directors exercise in full the power to purchase or acquire the

Date

Shares (Note)

China Everbright Water HoldingsBeneficial interest

2,084,724,572

72.87 80.97

Limited

China Everbright Environmental

Protection Holdings LimitedInterests in controlled corporation

2,084,724,572

72.87 80.97

Everbright Environment