China Glass : PROPOSED REDUCTION OF SHARE PREMIUM ACCUMULATED LOSSES SET OFF AND DISTRIBUTION OUT OF CONTRIBUTED SURPLUS ACCOUNT

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.

CHINA GLASS HOLDINGS LIMITED

中 國 玻 璃 控 股 有 限 公 司 *

(Incorporated in Bermuda with limited liability)

(Stock Code: 3300)

PROPOSED REDUCTION OF SHARE PREMIUM

ACCUMULATED LOSSES SET OFF

AND

DISTRIBUTION OUT OF CONTRIBUTED SURPLUS ACCOUNT

The Board is pleased to announce that, the Board has recommended the declaration of a Distribution of an amount of HK$36,202,941.16 (representing HK$0.02 per Share) out of the Contributed Surplus Account after the Reduction of Share Premium becoming effective.

The Board intends to put forward proposals to the Shareholders at the SGM for the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution.

The Distribution is conditional upon (i) the approval of the Shareholders for the Reduction of Share Premium and Distribution at the SGM; and (ii) compliance with the relevant requirements under the Companies Act and the Bye-Laws.

A circular relating to the SGM containing, amongst others, further details of the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution, together with the notice of SGM, will be sent to the Shareholders in due course.

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BACKGROUND

The Board is pleased to announce that, the Board has recommended the declaration of a Distribution of an amount of HK$36,202,941.16 (representing HK$0.02 per Share) out of the Contributed Surplus Account after the Reduction of Share Premium becoming effective.

PROPOSED REDUCTION OF SHARE PREMIUM, ACCUMULATED LOSSES SET OFF AND DISTRIBUTION

Reduction of Share Premium

The Board intends to put forward a proposal to the Shareholders at the SGM for the Reduction of Share Premium pursuant to the Companies Act and the Bye-Laws.

As at 30 June 2019, based on the unaudited interim results of the Company, the total amount standing to the credit of the Share Premium Account and the unaudited accumulated losses of the Company was approximately HK$2,367,844,529 and HK$298,458,069, respectively. It is proposed that the Share Premium Account will be reduced by HK$334,661,010.16 and the credit amount arising from such reduction will be transferred to the Contributed Surplus Account.

Accumulated Losses Set Off

It is proposed that after the Reduction of Share Premium, an amount of HK$298,458,069 standing to the credit of the Contributed Surplus Account be applied to set off against the accumulated losses of the Company.

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The Distribution

Subject to the approval of the Shareholders at the SGM for the proposed Reduction of Share Premium and transfer the credit amount arising therefrom to the Contributed Surplus Account, the Board also intends to put forward a proposal to the Shareholders at the SGM for a distribution of an amount of HK$36,202,941.16 (representing HK$0.02 per Share) out of the Contributed Surplus Account, payable to the Shareholders whose names appear on the register of members of the Company at the close of business on Friday, 18 October 2019, being the record date for determination of entitlement to the Distribution.

Shareholders are reminded that, in order to qualify for the proposed Distribution, properly completed transfer forms accompanied by the relevant share certificates must be lodged with the Company's branch share registrar and transfer office in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, not later than 4:30 p.m. on Friday, 18 October 2019, for registration.

Effect of the Reduction of Share Premium

The Reduction of Share Premium does not involve any reduction in the authorized or issued share capital of the Company nor does it involve any reduction in the nominal value of the Shares.

Implementation of the Reduction of Share Premium will not, of itself, affect the underlying assets, liabilities, business operations, management or financial position of the Company or the interests of the Shareholders as a whole or the share capital of the Company other than related expenses incurred.

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Conditions of the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution

The Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution are conditional upon, inter alia, the following being fulfilled:

1. the passing of a special resolution by the Shareholders to approve (1) the Reduction of Share Premium; (2) the Accumulated Losses Set Off; and (3) the Distribution at the SGM;
2. compliance with section 46(2) of the Companies Act, including (a) the publication of a notice of the Reduction of Share Premium in an appointed newspaper in Bermuda on a date not more than thirty days and not less than fifteen days before the Effective Date; and (b) the Directors being satisfied that on the Effective Date, there are no reasonable grounds for believing that the Company is, or after the Reduction of Share Premium will be unable to pay its liabilities as they become due; and
3. compliance with the relevant legal procedures and requirements under the Companies Act and the Bye-Laws to effect the Reduction of Share Premium and the Distribution.

Subject to the fulfilment of the above conditions, it is expected the Reduction of Share Premium and the Accumulated Losses Set Off will become effective on the business day immediately following the date of passing of the special resolution to approve the Reduction of Share Premium and the Accumulated Losses Set Off.

Subject to the Reduction of Share Premium and the Distribution having been approved by the Shareholders, the Distribution is expected to be paid to the Shareholders on or before Thursday, 31 October 2019.

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Reasons for the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution

The Board considers it appropriate to make the Distribution to repay the Shareholders' continuous support.

The Company is an investment holding company incorporated in Bermuda, the major incomes of which are principally dividends declared and paid by its operating subsidiaries. The Directors understand that it is prohibited under the Companies Act and the Bye-Laws from declaring dividends to the Shareholders when the Company has accumulated losses and no profits for the financial period. The Directors consider that the Reduction of Share Premium and the Accumulated Losses Set Off will allow the Company to eliminate its accumulated losses, thus providing more flexibility for future dividend distribution plans.

The Directors consider that the current losses position of the Company on an unconsolidated basis is temporary. The Company's consolidated financial position remains sound with satisfactory earnings during the six months ended 30 June 2019, and its operating subsidiaries in the PRC have sufficient reserves for profit distribution. Having considered the current financial position of the Group, in particular the Group's unaudited profit of RMB50,143,000 for the six months ended 30 June 2019, the Directors consider it appropriate to make certain distributions to the Shareholders. The Directors consider that the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution are beneficial to the Company and the Shareholders as a whole.

GENERAL

A circular relating to the SGM containing, amongst others, further details of the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution, together with the notice of SGM, will be sent to the Shareholders in due course.

Shareholders and potential investors should note that the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution are conditional upon satisfaction of the conditions set out in this announcement. Therefore, the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution may or may not proceed. Shareholders and potential investors should exercise caution when dealing in the securities of the Company.

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DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions shall have the following meanings when used herein:

"Accumulated Losses	subject to the Reduction of Share Premium
Set Off"	becoming effective, the application of an amount
	of HK$298,458,069 standing to the credit of the
	Contributed Surplus Account to set off against the
	accumulated losses of the Company

"Board"

"Bye-Laws"

"Companies Act"

"Company"

"Contributed Surplus Account"

"Director(s)"

"Distribution"

the board of Directors

the bye-law(s) of the Company currently in force

The Companies Act 1981 of Bermuda as amended, supplemented or otherwise modified from time to time

China Glass Holdings Limited（中國玻璃控股有限公

• * ）, an exempted company incorporated in Bermuda with limited liability and the Shares of which are listed on the main board of the Stock Exchange (Stock Code: 3300)

the contributed surplus account of the Company

the director(s) of the Company

subject to the Reduction of Share Premium becoming effective, the proposed distribution of an amount of HK$36,202,941.16 (representing HK$0.02 per Share) out of the Contributed Surplus Account be made to the Shareholders whose names appear on the Company's register of members at the close of business on Friday, 18 October 2019

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"Effective Date"

"Group" "HK$" "Hong Kong" "PRC"

"Reduction of Share Premium"

"RMB" "SGM"

"Share Premium Account" "Share(s)"

the date on which the Reduction of Share Premium shall become effective, being (subject to compliance with Section 46(2) of the Companies Act) the business day immediately following the day of passing of the special resolution to approve the Reduction of Share Premium at the SGM

the Company and its subsidiaries

Hong Kong dollars, the lawful currency of Hong Kong

Hong Kong Special Administrative Region of the PRC

The People's Republic of China (excluding, for the purpose of this announcement, Hong Kong, Macau Special Administrative Region of the PRC and Taiwan)

1. the proposed reduction of the Share Premium Account by HK$334,661,010.16; and (ii) the transfer of the credit amount arising from such reduction to the Contributed Surplus Account

Renminbi, the lawful currency of the PRC

the special general meeting of the Company to be convened and held at Salons I & II, Mezzanine Level, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai, Hong Kong on Tuesday, 15 October 2019 at 9:30 a.m. or at any adjournment thereof, for the Shareholders to consider and approve the Reduction of Share Premium, the Accumulated Losses Set Off and the Distribution

the share premium account of the Company

ordinary share(s) of par value HK$0.05 each in the issued share capital of the Company

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"Shareholder(s)"holder(s) of the Share(s) from time to time

"Stock Exchange"The Stock Exchange of Hong Kong Limited

By Order of the Board

China Glass Holdings Limited

Cui Xiangdong

Chief Executive Officer

Hong Kong, 11 September 2019

As at the date of this announcement, the directors of the Company are as follows:

Executive Director:

Mr. Cui Xiangdong (Chief Executive Officer)

Non-executive Directors:

Mr. Peng Shou (Chairman); Mr. Zhao John Huan; Mr. Zhou Cheng (Honorary Chairman) ; and Mr. Zhang Jinshu

Independent Non-executive Directors:

Mr. Zhang Baiheng; Mr. Zhao Lihua; and Mr. Chen Huachen

• For identification purpose only

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