Peak Sport Products : Documents on display - (025) Scheme document (English)

If you are in doubt as to any aspect of this Scheme Document, the Scheme, or as to the action to be taken, you should consult a licensed securities dealer, or registered institution in securities, a bank manager, solicitor, or other professional adviser.

If you have sold all your shares in Peak Sport Products Co., Limited, you should at once hand this Scheme Document and the accompanying forms of proxy to the purchaser or to the licensed securities dealer or registered institution in securities or other agent through whom the sale was effected for transmission to the purchaser.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this Scheme Document, 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 Scheme Document.

XU'S SPORT COMPANY LIMITED

許氏體育有限公司

(Incorporated in Hong Kong with limited liability)

PEAK SPORT PRODUCTS CO., LIMITED

匹克體育用品有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1968) PROPOSED PRIVATISATION OF PEAK SPORT PRODUCTS CO., LIMITED BY THE OFFEROR BY WAY OF A SCHEME OF ARRANGEMENT (UNDER SECTION 86 OF THE COMPANIES LAW) Financial Adviser to the Offeror Independent Financial Adviser to the Independent Board Committee

Unless the context requires otherwise, capitalised terms used in this Scheme Document are defined under the section headed "Definitions" in Part I of this Scheme Document.

A letter from the Board is set out in Part IV of this Scheme Document. A letter from the Independent Board Committee, containing its advice to the Independent Shareholders and the Optionholders in relation to the Proposal, the Scheme and the Option Offer (as the case may be) is set out in Part V of this Scheme Document. A letter from Gram Capital, being the Independent Financial Adviser to the Independent Board Committee, containing its advice to the Independent Board Committee in relation to the Proposal, the Scheme and the Option Offer is set out in Part VI of this Scheme Document. An Explanatory Memorandum regarding the Scheme is set out in Part VII of this Scheme Document.

The actions to be taken by the Shareholders and the Optionholders are set out in Part II of this Scheme Document.

Notices convening the Court Meeting and the EGM to be held on Wednesday, 19 October 2016 are set out in Appendix IV and Appendix V, respectively, to this Scheme Document. Whether or not you are able to attend the Court Meeting and/or the EGM or any adjournment thereof, you are strongly urged to complete and sign the enclosed pink form of proxy in respect of the Court Meeting and the enclosed white form of proxy in respect of the EGM, in accordance with the instructions printed thereon, and to lodge them at the office of the Company's branch share registrar, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen's Road East, Hong Kong as soon as possible but in any event not later than the respective times and dates as stated under "Part II - Actions to be taken" of this Scheme Document. If the pink form of proxy is not so lodged, it may also be handed to the chairman of the Court Meeting at the Court Meeting who shall have absolute discretion as to whether or not to accept it.

This Scheme Document is issued jointly by the Offeror and the Company.

The English language text of this Scheme Document shall prevail over the Chinese language text.

23 September 2016

Page
PART I	- DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
PART II	- ACTIONS TO BE TAKEN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
PART III	- EXPECTED TIMETABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
PART IV	- LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
PART V	- LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . .	23
PART VI	- LETTER FROM GRAM CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . .	25
PART VII	- EXPLANATORY MEMORANDUM . . . . . . . . . . . . . . . . . . . . . . . . .	40
APPENDIX I	- FINANCIAL INFORMATION ON THE COMPANY . . . . . . . . . . . . .	65
APPENDIX II	- GENERAL INFORMATION ON THE COMPANY AND THE OFFEROR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	136
APPENDIX III	- SCHEME OF ARRANGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . .	149
APPENDIX IV	- NOTICE OF COURT MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . .	155
APPENDIX V	- NOTICE OF EXTRAORDINARY GENERAL MEETING . . . . . . . . . .	157
APPENDIX VI	- FORM OF OPTION OFFER LETTER . . . . . . . . . . . . . . . . . . . . . . .	160

In this Scheme Document, the following expressions have the meanings set out below unless the context requires otherwise:

"acting in concert" has the meaning ascribed to it in the Takeovers Code and "concert

party(ies)" shall be construed accordingly

"Alpha Top" Alpha Top Group Limited, a company incorporated in the British Virgin Islands with limited liability and a substantial shareholder of the Company

"Approvals" has the meaning ascribed to it under the section headed "4. Conditions of the Proposal and the Scheme" in the Explanatory Memorandum

"associates" has the meaning ascribed to it in the Takeovers Code

"Authority(ies)" government, quasi-governmental and/or governmental body(ies), statutory or regulatory body(ies), court(s), or designated authorised body(ies) or agency(ies) of any of the foregoing

"Beneficial Owner" any beneficial owner of the Shares

"Board" the board of directors of the Company

"Brilliant Lead" Brilliant Lead Group Limited, a company incorporated in the British Virgin Islands with limited liability and a substantial shareholder of the Company

"Business Day" a day on which the Stock Exchange is open for the transaction of business

"Cancellation Price" the cancellation price of HK$2.60 per Scheme Share payable in

cash by the Offeror to the Scheme Shareholders pursuant to the Scheme

"CCASS" the Central Clearing and Settlement System established and operated by HKSCC

"CCASS Participant" a person admitted to participate in CCASS as a participant "CMB" China Merchants Bank Co., Ltd., Hong Kong Branch

"Companies Law" the Companies Law Cap. 22 (Law 3 of 1961), as consolidated and revised of the Cayman Islands

"Company" Peak Sport Products Co., Limited (匹克體育用品有限公司), an exempted company incorporated in the Cayman Islands with limited liability, the ordinary shares of which are currently listed on the Main Board of the Stock Exchange

"Condition(s)" the condition(s) to the implementation of the Proposal, the Scheme and the Option Offer as set out in the section headed "4. Conditions of the Proposal and the Scheme" in the Explanatory Memorandum

"Consents" has the meaning ascribed to it under the section headed "4. Conditions of the Proposal and the Scheme" in the Explanatory Memorandum

"Controlling Shareholder" Ever Sound Development Limited, a company incorporated in the

British Virgin Islands and the controlling shareholder of the Company

"Court Meeting" a meeting of the Scheme Shareholders to be convened at the direction of the Grand Court at which the Scheme will be voted upon, which is to be held at Rooms 1 & 2, United Conference Centre, 10/F, United Centre, 95 Queensway, Hong Kong at 3:00

p.m. on Wednesday, 19 October 2016, notice of which is set out in Appendix IV to this Scheme Document, or any adjournment thereof

"DG Management Co" has the meaning ascribed to it in the section headed "4.(c)

Arrangements with the Offeror and Offeror Concert Parties in respect of the Proposal and other interests" in Appendix II to this Scheme Document

"Director(s)" director(s) of the Company

"Disclosure Period" the period beginning from the date which is six months prior to the

Offer Period Commencement Date and ending with the Latest Practicable Date, both dates inclusive

"Effective Date" the date on which the Scheme, if approved and sanctioned by the Grand Court, becomes effective in accordance with its terms and the Companies Law, being the date on which a copy of the court order of the Grand Court sanctioning the Scheme is delivered to the Registrar of Companies in the Cayman Islands for registration pursuant to Section 86(3) of the Companies Law, and which is expected to be Monday, 31 October 2016 (Cayman Islands time)