Cosmos Machinery Enterprises : PROPOSALS INVOLVING GENERAL MANDATES TO BUY BACK SHARES AND TO ISSUE SHARES, RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

bb2dc9de-c701-4630-9d85-d6256f6822c8.pdf If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in COSMOS MACHINERY ENTERPRISES LIMITED (the "Company"), you should at once hand this circular and the accompanying form of proxy to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale was effected, for transmission to the purchaser or the transferee.

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.

(Incorporated in Hong Kong with limited liability)

(Stock Code: 118)

PROPOSALS INVOLVING GENERAL MANDATES TO BUY BACK SHARES AND TO ISSUE SHARES, RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of the Company to be held at Ming Room II, 4th Floor, Sheraton Hong Kong Hotel & Towers, 20 Nathan Road, Kowloon, Hong Kong on Wednesday, 25 May 2016 at 9:30 a.m. is set out in pages 13 to 16 of this circular. Whether or not you propose to attend the meeting, you are requested to complete the form of proxy enclosed with this circular in accordance with the instructions printed thereon and return the same to the registered office of the Company at 10/F, Billion Plaza 2, No. 10 Cheung Yue Street, Cheung Sha Wan, Kowloon, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the Annual General Meeting or any adjourned meeting thereof and, in such event, the relevant form of proxy shall be deemed to be revoked.

19 April 2016

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Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Letter from the Board

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

General Mandate to Buy Back Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Proposed Election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Voting at the Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Appendix I - Explanatory Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Appendix II - Details of Directors Proposed to be Re-elected . . . . . . . . . . . . . . . . . . . . . . . . 9 Notice of Annual General Meeting 13

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

"AGM" the annual general meeting of the Company to be held at Ming Room II, 4th Floor, Sheraton Hong Kong Hotel & Towers, 20 Nathan Road, Kowloon, Hong Kong on Wednesday, 25 May 2016 at 9:30 a.m.

"AGM Notice" the notice dated 19 April 2016 convening the AGM as set out in pages 13 to 16 of this circular

"associates" as such term is defined under the Listing Rules

"associated company" as such term is defined under financial reporting standards

approved by the Hong Kong Institute of Certified Public Accountants

"Auditors" the auditors for the time being of the Company

"Board" the board of directors of the Company or a duly authorised committee thereof for the time being

"Business Day" a day (other than a Saturday or a Sunday) on which licensed banks are generally open for business in Hong Kong and the Stock Exchange is open for business of dealing in securities

"Buy-back Mandate" a general mandate to the Directors to exercise the power of the

Company to buy back Shares during the period as set out in Ordinary Resolution no. 4 up to 10% of the issued shares of the Company as at the date of passing such resolution

"chief executive(s)" as such term is defined under the Listing Rules

"Company" Cosmos Machinery Enterprises Limited, a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange

"Companies Ordinance" the Companies Ordinance (Chapter 622 of the Laws of Hong

Kong)

"connected person(s)" as such term is defined under the Listing Rules "controlling shareholder(s)" as such term is defined under the Listing Rules "day" calendar day

"Directors" the directors of the Company for the time being

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"Articles" the articles of association of the Company

"Group" the Company and its subsidiaries and associated companies from time to time

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

"Issue Mandate" a general mandate to the Directors to exercise the power of the Company to allot, issue and deal with Shares during the period as set out in Ordinary Resolution no. 5 up to 20% of the issued shares of the Company as at the date of passing such resolution

"Latest Practicable Date" 8 April 2016, being the latest practicable date prior to the printing

of this circular for ascertaining certain information contained herein

"Listing Rules" the Rules Governing the Listing of Securities on the Stock Exchange

"month" calendar month

"Resolution(s)" the proposed ordinary as referred to in the AGM Notice

"SFO" The Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

"Share(s)" share(s) of the Company

"Shareholder(s)" holder(s) of Share(s)

"Stock Exchange" The Stock Exchange of Hong Kong Limited

"subsidiary" a company which is for the time being and from time to time a subsidiary (within the meaning of the Companies Ordinance or the Listing Rules)

"substantial shareholder" as such term is defined under the Listing Rules "Takeover Code" the Hong Kong Codes on Takeovers and Mergers

"HK$" Hong Kong dollars, the lawful currency of Hong Kong

"%" per cent

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