Kingwell : MAJOR TRANSACTION IN RELATION TO THE DISPOSAL OF 35% EQUITY INTERESTS IN THE TARGET COMPANY AND RE-ELECTION OF DIRECTOR

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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 Kingwell Group Limited, you should at once hand this circular together with 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.

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.

KINGWELL GROUP LIMITED

京 維 集 團 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1195)

MAJOR TRANSACTION IN RELATION TO

THE DISPOSAL OF 35% EQUITY INTERESTS IN

THE TARGET COMPANY

AND RE-ELECTION OF DIRECTOR

Financial Adviser to the Company

Capitalised terms used in this cover page shall have the same meaning as those defined in this circular.

A letter from the Board is set out on pages 4 to 11 of this circular.

A notice convening the extraordinary general meeting of the Company to be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 10 October 2019 at 11 a.m. is set out on page 20 to 21 of this circular. A form of proxy for the extraordinary general meeting is enclosed herein. Whether or not you are able to attend the extraordinary general meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company's branch share registrar, Hong Kong Registrars Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong as soon as possible, but in any event not less than 48 hours before the time appointed for the holding of the extraordinary general 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 extraordinary general meeting or any adjourned meeting thereof should you so wish.

18 September 2019

CONTENTS

			Page
DEFINITIONS .	. . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
APPENDIX I	-	FINANCIAL INFORMATION OF THE GROUP . . . . . . . . . . . . . . . . . . . .	12
APPENDIX II	-	DETAILS OF RETIRING DIRECTOR PROPOSED
		FOR RE-ELECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
APPENDIX III -	GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16
NOTICE OF EGM .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20

- i -

DEFINITIONS

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

''associate''	has the same meaning ascribed thereto under the Listing Rules
''Business Day(s)''	any day other than a Saturday, Sunday or public holiday on
	which banks are generally open for business in Hong Kong
''Board''	the board of Directors
''Company''	Kingwell Group Limited（京維集團有限公司）, a company
	incorporated in Cayman Islands with limited liability and the
	shares of which are listed on the main board of the Stock
	Exchange (stock code: 1195)
''Completion''	completion of the Disposal
''Conditions''	the conditions precedent to the Completion as set out in the
	paragraph headed ''Conditions Precedent'' under the section
	headed ''The Sale and Purchase Agreement'' in this circular
''connected person(s)''	has the same meaning ascribed to it in the Listing Rules
''Consideration''	the consideration of RM B53.0 mi llion (equi val ent to
	approximately HK$60.4 million) payable by the Purchaser to the
	Company for the Disposal pursuant to the Sale and Purchase
	Agreement
''Director(s)''	the director(s) of the Company
''Disposal''	the proposed disposal of 35% equity interests in the Target
	Company by the Company to the Purchaser pursuant to the terms
	of the Sale and Purchase Agreement
''EGM''	extraordinary general meeting of the Company to be convened on
	10 October 2019 for the purpose of approving the Sale and
	Purchase Agreement and the transactions contemplated thereunder
''Group''	the Company and its subsidiaries
''HK$''	Hong Kong dollars, the lawful currency of Hong Kong
''Hong Kong''	Hong Kong Special Administrative Region of the PRC
''Independent Third Party''	any person or company and their respective ultimate beneficial
	owner(s), to the best knowledge, information and belief of the
	Directors and having made all reasonable enquiries, is a third
	party independent of the Company and its connected persons

- 1 -

DEFINITIONS

''Latest Practicable Date''	12 September 2019, being the latest practicable date prior to the
	despatch of this circular for the purpose of ascertaining certain
	information contained herein
''Listing Rules''	the Rules Governing the Listing of Securities on the Stock
	Exchange
''Longkou Jinhui''	龍口市金匯黃金有限責任公司(Longkou Jinhui Gold Company
	Limited*), a subsidiary of the Target Company and is mainly
	engaged in the mining, processing and sale of gold bars in the
	PRC
''Longkou Jinxin''	龍口市金鑫黃金有限公司(Longkou Jinxin Gold Company
	Limited*), a subsidiary of the Target Company and is mainly
	engaged in the mining, processing, refining and sale of gold bars
	in the PRC
''PRC''	The People's Republic of China
''Purchaser''	Wu Fong Shing, who is the controlling shareholder of the Target
	Company, interested in 65% equity interest in the Target
	Company
''RMB''	Renminbi, the lawful currency of PRC
''Sale and Purchase Agreement''	the sale and purchase agreement dated 21 June 2019 entered into
	between the Company and the Purchaser in relation to the
	Disposal (as amended and supplemented by the Supplemental
	Agreements)
''Sale Share(s)''	the 17,500 Shares, representing 35% equity interests in the Target
	Company to be disposed of by the Company to the Purchaser
''Shanchakou Mine''	the mining asset of Longkou Jinxin, located at Dazhuangzi
	Village, Xiadingjia Town, Longkou City, Shandong Province,
	PRC
''Share(s)''	ordinary share(s) of HK$0.10 each in the issued share capital of
	the Company
''Shareholder(s)''	holder(s) of the Share(s)
''Stock Exchange''	The Stock Exchange of Hong Kong Limited
''Supplemental Agreements''	the supplemental agreements to the Sale and Purchase Agreement
	entered by the Company and the Purchaser on 7 August 2019 and
	9 September 2019

- 2 -

DEFINITIONS

''Target Company''	Port First Limited（首港有限公司）, a limited company
	established in British Virgin Islands, held as to 35% by the
	Company and as to 65% by the Purchaser, and principally
	engages in investment holdings
''Xuzhou City''	a city in Jiangsu Province, the PRC
''Yaojia Mine''	the mining asset of Longkou Jinhui, located at Huangshanguan
	Town, Longkou City, Shandong Province, PRC
''%''	per cent

• The English translation of the Chinese name is for identification purposes only, and should not be regarded as the official English translation of such name.

For the purpose of illustration only, amounts denominated in RMB in this circular have been translated into HK$ at the rate of RMB1.00 = HK$1.14. Such translations should not be construed as a representation that the amounts in question have been, could have been or could be converted at any particular rate or at all.

- 3 -

LETTER FROM THE BOARD

KINGWELL GROUP LIMITED

京 維 集 團 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1195)

Executive Directors	Registered Office:
Mr. Mu Dongsheng (Chairman)	Cricket Square
Mr. Sze Ming Yee	Hutchins Drive
	P.O. Box 2681
Independent Non-Executive Directors	Grand Cayman
Mr. Cheung Chuen	KY1-1111
Mr. Ling Aiwen	Cayman Islands
Mr. Lu Lin
	Principal Office in Hong Kong:
	Units 314-315
	Wing On Plaza
	62 Mody Road
	Tsim Sha Tsui East
	Kowloon, Hong Kong
	18 September 2019
To the Shareholders
Dear Sir or Madam,

MAJOR TRANSACTION IN RELATION TO

THE DISPOSAL OF 35% EQUITY INTERESTS IN

THE TARGET COMPANY

AND RE-ELECTION OF DIRECTOR

INTRODUCTION

The Board announced that on 21 June 2019, the Company and the Purchaser entered into the Sale and Purchase Agreement (amended and supplemented by the Supplemental Agreements dated 7 August 2019 and 9 September 2019), pursuant to which the Company conditionally agreed to sell and the Purchaser conditionally agreed to acquire the Sale Shares, being the 35% equity interests in the Target Company, at the Consideration of RMB53.0 million (equivalent to approximately HK$60.4 million).

The purpose of this circular is to give you, among others, (i) further details of the Sale and Purchase Agreement; (ii) financial information of the Group; (iii) the proposed re-election of Director;

1. notice of the EGM; and (v) other information as required under the Listing Rules.
2. • 4 -

LETTER FROM THE BOARD

THE SALE AND PURCHASE AGREEMENT

Date:	21	June 2019 (as amended and supplemented by the Supplemental Agreements
	dated 7 August 2019 and 9 September 2019)
Parties:	(i)	the Company as the vendor; and
	(ii)	Wu Fong Shing as the Purchaser

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Purchaser is an Independent Third Party.

Asset to be disposed of

The Sale Shares, representing 35% equity interests in the Target Company comprising an aggregate of 17,500 shares of the Target Company, free from any lien, charge or encumbrance.

Consideration and Payment Terms

The Consideration of RMB53.0 million (equivalent to approximately HK$60.4 million) shall be settled in cash by the Purchaser in the following manner:

1. first instalment of RMB10.6 million (equivalent to approximately HK$12.1 million) is payable within five Business Days from the date of the Sale and Purchase Agreement;
2. second instalment of RMB10.6 million (equivalent to approximately HK$12.1 million) is payable within five Business Days after three months from the date of the Sale and Purchase Agreement;
3. third instalment of RMB10.6 million (equivalent to approximately HK$12.1 million) is payable within five Business Days after six months from the date of the Sale and Purchase Agreement;
4. fourth instalment of RMB10.6 million (equivalent to approximately HK$12.1 million) is payable within five Business Days after nine months from the date of the Sale and Purchase Agreement; and
5. remaining RMB10.6 million (equivalent to approximately HK$12.1 million) is payable within five Business Days after twelve months from the date of the Sale and Purchase Agreement.

The Consideration was determined after arm' s length negotiations between the Company and the Purchaser after taking into account of (i) the Group's share of net assets of the Target Company as at 30 June 2018 of approximately RMB50.3 million (equivalent to approximately HK$57.3 million); and (ii) financial performance and licensing issue of the Target Company and its subsidiaries. The Directors are of the view that the Consideration is fair and reasonable.

- 5 -

LETTER FROM THE BOARD

Prior to entering the Sale and Purchase Agreement, the Company has reviewed banking documents provided by the Purchaser and is satisfied with his ability to satisfy the Consideration. The Purchaser also agreed to provide updated banking documents upon payment of each installment to support his ability to satisfy the remaining Consideration.

Pursuant to the Supplemental Agreements, Completion will not take place until the Company having received all of the Consideration (i.e. RMB53 million (equivalent to approximately HK$60.4 million)).

In the event that the Purchaser does not settle the Consideration in accordance to the payment terms stated on the Sale and Purchase Agreement, the Company will take appropriate legal actions against the Purchaser.

Conditions precedent

Completion is conditional upon the fulfillment of the following Conditions:

1. the Shareholders having approved the Sale and Purchase Agreement and the transactions contemplated thereunder at the EGM;
2. the Sale and Purchase Agreement and transactions contemplated thereunder have been completed in accordance with the memorandum and articles of association of the Company and all applicable laws and regulations (including Listing Rules);
3. warranties given by the Purchaser and the Company remaining true, accurate and not misleading in all material respects prior to Completion, and there have been no circumstances that would reasonably cause the warranties to be no longer true, accurate and not misleading; and
4. the Company having received all of the Consideration (i.e. RMB53 million (equivalent to approximately HK$60.4 million)).

None of the Conditions can be waived without consent of both the Purchaser and the Company.

As at the Latest Practicable Date, none of the Conditions has been fulfilled or waived.

The Company and the Purchaser shall use their best endeavour to procure the fulfilment of the Conditions. If any of the Conditions are not satisfied by 30 June 2020, the Company and the Purchaser may extend the latest time for satisfying all the Conditions by mutually agreeing in writing or terminate the Sale and Purchase Agreement.

Undertaking, Warranties and Indemnity

The Company and the Purchaser have given customary warranties to the other party.

Completion

Completion shall take place on the seventh business day after all the Conditions have been fulfilled or any other day at any venue the Company and the Purchaser both agreed upon.

Upon Completion, the Target Company will cease to be an associate company of the Company.

- 6 -

LETTER FROM THE BOARD

INFORMATION ON THE TARGET COMPANY

The Target Company is an investment holding company incorporated in the British Virgin Islands with limited liability. As at the Latest Practicable Date, the Company is interested in 35% of the Target Company and financial results of the Target Company were consolidated as ''investment in an associate'' in the financial statements of the Group.

Before production suspension, the products of the Target Company mainly comprise gold bars which are produced from processing and smelting of the gold ores and concentrates extracted from Shanchakou Mine and Yaojia Mine or purchased from the nearby gold mining companies.

The Target Company has two 70% owned subsidiaries, namely Longkou Jinxin and Longkou Jinhui, which are engaged in the mining, processing, refining and sale of gold bars in the PRC.

Longkou Jinxin

The Longkou Jinxin, a company established in the PRC on 28 June 2005 with limited liability which holds the mine exploitation license and exploration license of the Shanchakou Mine, and owns a gold processing plant and a gold refinery plant.

The Shanchakou Mine is situated within the Linglong gold field, approximately 25 km south of Huangcheng in Longkou, and has a mining area of approximately 0.73km2.

Longkou Jinhui

The Longkou Jinhui, a company established in the PRC on 20 September 1999, with limited liability which holds the gold mine exploitation license of the Yaojia Mine.

The Yaojia Mine is located approximately 11 km to the southwest of Longkou City, and has a mining area of approximately 2.11km2.

- 7 -

LETTER FROM THE BOARD

Summary of financial information of the Target Company for the two years ended 30 June 2017 and 2018 are set out below:

	As at 30 June
	2017			2018
	RMB'000	RMB'000
Total assets	394,343			390,559
Total liabilities	(147,134)		(153,367)
Net assets	247,209			237,192
Non-controlling interests	(96,440)		(93,592)
	150,769			143,600
Reconciliation to the Group's interest in
the Target Company:
Proportion of the Group's ownership	35%			35%
Group's share of net assets of the Target Company	52,769			50,260
	For the year ended 30 June
	2017			2018
	RMB'000	RMB'000
Revenue	49,867			4,637
Loss before tax	(25,536)		(12,239)
Income tax (expense)/credit	(271)		2,177
Loss for the year	(25,807)		(10,062)
Loss for the year attributable to:
Owners of the Target Company	(18,035)		(7,168)
Non-controlling interests of the Target Company	(7,772)		(2,894)

INFORMATION ON THE PURCHASER

The Purchaser is the controlling shareholder of the Target Company, interested in 65% equity interest in the Target Company comprising an aggregate of 32,500 shares of the Target Company.

The Purchaser is an experienced investor with over 20 years of investment experience in the capital market and property market and over 10 years of gold mine investment experience.

- 8 -

LETTER FROM THE BOARD

REASONS FOR AND BENEFIT OF THE DISPOSAL

The Company is principally engaged in property development, property leasing, property management services and gold mining business.

The Sale Shares were acquired by the Company on 30 January 2015 at consideration of RMB150 million (equivalent to approximately HK$171 million), however, performance of the Target Company has not been satisfactory. Due to decrease in production volume by Longkou Jinxin and Longkou Jinhui and plunging gold price, the Target Company recorded a net loss of approximately RMB25.8 million (equivalent to approximately HK$29.4 million) and approximately RMB10.1 million (equivalent to approximately HK$11.5 million) for the financial years ended 30 June 2017 and 2018, respectively. As a result, the Group shared loss of the Target Company of approximately RMB6.3 million (equivalent to approximately HK$7.2 million) and approximately RMB2.5 million (equivalent to approximately HK$2.9 million) for the financial years ended 30 June 2017 and 2018, respectively. The Company had also recorded an impairment loss of approximately RMB73.1 million (equivalent to approximately HK$83.3 million) for the year ended 30 June 2017.

In addition, the mine exploitation license and exploration license of the Shanchakou Mine had expired on 1 June 2018 and 28 September 2018 respectively, and the mine exploitation license of the Yaojia Mine had expired on 31 December 2017. Although Longkou Jinxin and Longkou Jinhui had applied for the renewal of the above licenses, as at the Latest Practicable Date, due to the tightened environmental regulations, no renewal approval was granted by the provincial government. Management of the Target Company is of the view that it would be difficult to obtain licenses renewal under the tightened regulations.

On another hand, given the present economic condition and political tension between the United States and the PRC, gold price is expected to be volatile, which cast further uncertainty over the gold mining industry. The Company believes that it is the Company's interest to dispose the Sale Shares and salvage value when suitable opportunity arises and prevent further damage to the Group's consolidated financial results.

In view of (i) the detreating financial performance of the Target Company; (ii) the expiration of licenses of the Shanchakou Mine and Yaojia Mine; (iii) the difficulty of renewing the mining licenses; and (iv) the prospect of the gold mining industry, the chances in finding another buyer for the Sale Shares with an improved offer are slim. Given the circumstances, the Purchaser, who had conditionally agreed to acquire the Sale Shares under the terms of the Sale and Purchase Agreement poses a good opportunity for the Company to dispose of the Sale Shares.

The Company has been devoting more resources in property related businesses. In 2018 and 2019, the Company acquired a property management business and 700 carpark spaces in Xuzhou City. The Company is also actively searching for new investment opportunities in property market and suitable site for property development project. As such, the Board believes that the Disposal is in line with the investment strategy of the Group.

The Directors have reviewed the financial position of the Purchaser and are satisfied that the Purchaser has the ability to settle the Consideration. Based on the abovementioned factors, the Directors consider that the terms of the Sale and Purchase Agreement are fair and reasonable, and the Disposal is in the interests of the Company and its Shareholders as a whole.

- 9 -

LETTER FROM THE BOARD

USE OF PROCEEDS

The Group intends to apply the proceeds from the Disposal as to (i) RMB13 million (equivalent to approximately HK$14.8 million) for new investment opportunities in property market in the PRC; (ii) settle RMB20 million (equivalent to approximately HK$22.8 million) of the outstanding consideration due for the acquisition of 700 carpark spaces in Xuzhou City; and (iii) the remaining will be applied as general working capital of the Group.

As at the Latest Practicable Date, no specific investment target was identified by the Company.

FINANCIAL EFFECT OF THE DISPOSAL

Earnings

As a result of the Disposal, the Group is expected to record an unaudited gain of approximately RMB2.7 million (equivalent to approximately HK$3.1 million) which represents the difference between the Consideration of RMB53.0 million (equivalent to approximately HK$60.4 million) and the proportion of equity interest in the Target Company of approximately RMB50.3 million (equivalent to approximately HK$57.3 million) as at 30 June 2018.

Assets and liabilities

Given that the Disposal is expected to generate an unaudited gain of approximately RMB2.7 million (equivalent to approximately HK$3.1 million), the consolidated net asset value attributable to equity holders of the Company is expected to increase by approximately RMB2.7 million (equivalent to approximately HK$3.1 million) (subject to audit) upon Completion.

Shareholders and potential investors of the Company should note that the actual financial effects of the Disposal to the Group may be different from those of the above and can only be determined based on the then financial position of the Target Company upon Completion (subject to audit).

Upon Completion, the Company will cease to have any interest in the Target Company, and the financial results of the Target Company will no longer be shared into the consolidated financial statements of the Company under the equity method.

RE-ELECTION OF DIRECTOR

Pursuant to the appointment letter given to Mr. Lu Lin (''Mr. Lu''), Mr. Lu was appointed as independent non-executive Director for an initial term of one year commencing from 30 April 2019 and, pursuant to article 86(3) of the articles of association of the Company, shall hold office until the next following general meeting of the Company after his appointment and shall then be eligible for reelection at such meeting. Accordingly, Mr. Lu will retire at the EGM and has confirmed that he will offer himself for re-election thereat. Biographical details of Mr. Lu are set out in Appendix II to this circular.

- 10 -

LETTER FROM THE BOARD

IMPLICATIONS UNDER THE LISTING RULES

As one or more of the applicable percentage ratios calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Disposal is more than 25% but less than 75%, the Disposal constitutes a major transaction for the Company under Rule 14.06(3) of the Listing Rules and is subject to the reporting, announcement and Shareholders' approval requirements under Chapter 14 of the Listing Rules.

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, no Shareholder is required to abstain from voting on the resolution(s) in respect of the Sale and Purchase Agreement and the transactions contemplated thereunder at the EGM.

EGM

The EGM will be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 10 October 2019 at 11 a.m. to consider and, if thought fit, approve the Sale and Purchase Agreement and the transactions contemplated thereunder.

A notice convening the EGM is set out on pages 20 to 21 of this circular. A proxy form for use at the EGM is enclosed with this circular. Whether or not you intend to attend the EGM or any adjournment thereof, you are requested to complete the accompanying proxy form in accordance with the instructions printed thereon and return the same to the Company's branch share registrar and transfer office in Hong Kong, Hong Kong Registrars Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, not less than 48 hours before the time appointed for holding the EGM or any adjournment thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournment thereof if you so wish.

To the best of the Directors' knowledge, information and belief, having made all reasonable enquires, no Shareholder has a material interest in the Sale and Purchase Agreement and the transactions contemplated thereunder, therefore, no Shareholder is required to abstain from voting for the resolutions to be proposed at the EGM.

RECOMMENDATION

The Board (including the independent non-executive Directors) considered that the terms of the Sale and Purchase Agreement and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole. The Board also considered that the proposed re-election of Mr. Lu as a Director is in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend that the Shareholders to vote in favour of the resolutions to be proposed at the EGM.

ADDITIONAL INFORMATION

Your attention is drawn to the information set out in the appendices set out in this circular.

By Order of the Board

Kingwell Group Limited

Mu Dongsheng

Chairman

- 11 -

APPENDIX I	FINANCIAL INFORMATION OF THE GROUP

1. FINANCIAL SUMMARY

Financial information of the Group for each of the three financial years ended 30 June 2016, 2017 and 2018 and six months ended 31 December 2018 are disclosed in the following documents which have been published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (http://kingwell.todayir.com).

1. annual report of the Company for the year ended 30 June 2016 (pages 39 to 130) (http://www3.hkexnews.hk/listedco/listconews/SEHK/2016/1024/LTN20161024333.pdf)
2. annual report of the Company for the year ended 30 June 2017 (pages 38 to 120) (http://www3.hkexnews.hk/listedco/listconews/SEHK/2017/1027/LTN20171027331.pdf)
3. annual report of the Company for the year ended 30 June 2018 (pages 39 to 120) (http://www3.hkexnews.hk/listedco/listconews/SEHK/2018/1029/LTN20181029630.pdf)
4. interim report of the Company for the six months ended 31 December 2018 (pages 5 to 27) (http://www3.hkexnews.hk/listedco/listconews/SEHK/2019/0322/LTN20190322454.pdf)

2. INDEBTEDNESS STATEMENT

As at the close of business on 31 July 2019, being the latest practicable date for the purpose of this indebtedness statement prior to the printing of this circular, the Group has no borrowings.

Contingent liabilities

On 31 July 2019, guarantees given to the banks by the Group in connection with facilities granted to the buyers of certain properties developed by the Group was RMB3,000,000.

Save as aforesaid, and apart from intra-group liabilities, the Group did not have any outstanding debt securities issued and outstanding, and authorised or otherwise created but unissued, term loans, bank overdrafts and loans, other loans or other similar indebtedness, liabilities under acceptance or acceptable credits, debentures, mortgages, charges, hire purchases commitments, guarantee or other material contingent liabilities, at the close of business on 31 July 2019.

The Board has confirmed that, save as disclosed above, there has not been any material change in the indebtedness or contingent liabilities of the Group since 31 July 2019.

- 12 -

APPENDIX I	FINANCIAL INFORMATION OF THE GROUP

3. WORKING CAPITAL OF THE GROUP

The Directors, after due and careful enquiry, are of the opinion that, after taking into account the financial resources presently available to the Group including the internally generated funds, the currently available facilities and the effects of the Disposal, and in the absence of unforeseen circumstances, the Group has sufficient working capital for its normal business for at least the next twelve months from the date of this circular.

4. MATERIAL ADVERSE CHANGE

The Directors confirmed that they are not aware of any material adverse change in the financial position of the Group since 30 June 2018 (being the date to which the latest published audited consolidated financial statements of the Group were made up) up to the Latest Practicable Date.

5. FINANCIAL AND TRADING PROSPECT OF THE REMAINING GROUP

The Group is principally engaged in property development, property leasing and gold mining business. Following Completion, the remaining Group will take steps to enhance rental yield and return of its property investments in the PRC and actively seek for new investment opportunities for potential property development project.

The Group developed its property development and property leasing business in Anlu City, Hubei Province, the PRC. The real estate project comprises various types of properties including villas, apartments and commercial buildings. Although the property market in the PRC is still under great pressure, the Directors expect that the property development and property leasing business will continue to provide positive cash flow in the future. Also, the Group will search for new investment opportunities in property market. Therefore, the Group is actively searching suitable site for property development project.

In order to expand the existing property development and property leasing business, the Group acquired a property management business in Xuzhou City, Jiangsu Province, the PRC. The property management business commenced operation in July 2014, and specializes in the high-end property management sector. Services include provision of (i) management and maintenance service to facilities of the estate; (ii) cleaning and environmental services for common area; and (iii) 24 hours security services. This business can not only provide profits to the Group, but also enhance the Group's expertise in the daily management of properties in the PRC, enabling the Group to improve the quality of the property management at the Group's property development project for now and in the future.

On 1 March 2019, the Group acquired 700 carpark spaces in Xuzhou City, which are located in a property project in Xincheng District, Xuzhou City, Jiangsu Province, the PRC, in view to expand the Group's participation in the PRC property market. The acquisition is expected to further enhance the revenue of the Group.

- 13 -

APPENDIX I	FINANCIAL INFORMATION OF THE GROUP

As for the gold mining business of the Group in Russia, since the mining area is too large and the rock composition in the northern Molchan region is complex, the Russia gold mining company planned to conduct small scale production prior to large scale exploitation, which is common for all the mining exercise. The gold mining company submitted the plan of exploitation to the local government in October 2017. However, due to the increase in number of wildfire and environmental destruction incidents caused by mining activities in 2017, the Russian authority raised the environment protection requirements on exploitation applications at the beginning of 2018. As the Company signed an outsourcing contract with a third party in September 2018 which modified the original submitted plan, the Company was required to re-submit a new plan of exploitation which satisfies the tightened regulation. The Company has filed the reschedules in November 2018 and expected to obtain the exploitation approval within the year of 2019. According to the new legal requirements for the Russian authority, it is impossible to get the working visa for the PRC workers. In this case, the outsourcing contractor had employed the local Russian worker for this project. The Company and the outsourcing contractor had started the foundation work for the exploitation process in May 2019.

As can be seen from the analysis shown in the sections headed ''Financial effects of the Disposal'' and ''Reasons for and benefit of the Disposal'' in the letter from the Board, the net asset value and the financial position of the remaining Group would be enhanced following completion of the Disposal, which is beneficial to the long-term development of the remaining Group. Furthermore, the completion of the Disposal would also facilitate the remaining Group to look for new business opportunities, including, inter alia, land acquisitions and property/hotel investments, should opportunities arise.

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APPENDIX II	DETAILS OF RETIRING DIRECTOR
	PROPOSED FOR RE-ELECTION

Mr. Lu Lin（盧霖）

Independent Non-executive Director

Mr. Lu Lin, aged 44, joined the Board on 30 April 2019 as an independent non-executive Director. He is the chairman of the corporate government committee as well as a member of each of the audit committee and the nomination committee of the Company. He is the senior advisor of the Changan International Trust Co., Ltd since May 2014. He was the director of the RSM International from May 2011 to April 2014. He was the senior investment analyst of the Triangle Capital from April 2010 to May 2011. He was the manager of the Property Investment Fund, Property Dimensions from January 2008 to April 2010. Mr. Lu has working experience in various investment sector in PRC and United Kingdom, and has over 20 years of experience in the investment and management field. Save as disclosed above, He does not hold any directorships in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years.

Mr. Lu declared that, as at the Latest Practicable Date, he does not have any relationship with any Directors, senior management or substantial or controlling shareholders (as defined in the Listing Rules) of the Company, nor does he have any interest in the Shares, underlying shares and debentures of the Company within the meaning of Part XV of the SFO.

Pursuant to the appointment letter given to Mr. Lu, his appointment as independent non-executive Director of the Company shall be for an initial term of one year commencing from 30 April 2019 and is subject to retirement by rotation and offers himself for re-election in accordance with the articles of association of the Company. He will also be subject to retirement by rotation at least once every three years at the annual general meetings of the Company since his last re-election pursuant to the articles of association of the Company and the Listing Rules. Mr. Lu is entitled to receive a director's fee of HK$120,000 per annum, which was recommended by the remuneration committee and determined by the Board as authorized by the Shareholders at the annual general meeting with reference to the prevailing market rate as well as the duties and responsibilities to be undertaken by him as a Director.

Save as disclosed above, Mr. Lu confirmed that there is no other information required to be disclosed pursuant to Rule 13.51(2)(h) to (v) of the Listing Rules, and the Company is not aware of any other matters in relation to his proposed re-election that need to be brought to the attention of the Shareholders.

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APPENDIX III	GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERETS

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the Shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which (a) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); or (b) were required pursuant to Section 352 of the SFO to the entered in the register referred to therein; or (c) were required pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the ''Model Code'') as set out in Appendix 10 of the Listing Rules to be notified to the Company and the Stock Exchange, were as follows:

Long positions in Shares and options of the Company

				Number of	Total
			Number of	underlying	approximate
			issued	shares held	% of the
		Number of	ordinary	pursuant to	issued share
Name of Directors	Capacity	Shares	shares held	share options	capital
Mr. Sze Ming Yee	Interest held as beneficial owner and	384,198,376	384,198,376	-	13.32
	through controlled corporation		(Note 1)
Mr. Mu Dongsheng	Beneficial owner	290,777,777	277,777,777	13,000,000	10.08
				(Note 2)

Notes:

1. 384,198,376 shares are held by Union Day Group Limited (a company incorporated in the British Virgin Islands with limited liability) which is 72% beneficially owned by Mr. Sze Ming Yee.
2. 13,000,000 shares options are held by Mr. Mu Dongsheng.

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APPENDIX III	GENERAL INFORMATION

Save as disclosed above, as at the Latest Practicable Date, none of the Directors, chief executive of the Company and their associates had any interests and short positions in the Shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which (a) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); or (b) were required pursuant to Section 352 of the SFO to be entered in the register referred to therein; or (c) were required pursuant to the Model Code to be notified to the Company and the Stock Exchange.

3. SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as is known to the Directors and chief executive of the Company, no other parties (other than a Director and chief executive of the Company) who had interests or short positions in the Shares and underlying shares of the Company which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had any options in respect of such capital.

4. COMPETING INTEREST

As at the Latest Practicable Date, the Directors confirm that neither themselves nor any of their respective close associates (as defined in the Listing Rules) were interested in any business apart from the business of the Group which competed, or was likely to compete, either directly or indirectly, with the business of the Group.

5. INTEREST IN ASSETS

As at the Latest Practicable Date, none of the Directors had any interest, direct or indirect, in any assets which had been, since 30 June 2018 (being the date to which the latest published audited financial statements of the Company were made up) and up to the Latest Practicable Date, acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

6. INTEREST IN CONTRACT OR ARRANGEMENT

The Directors confirm that there was no contract or arrangement subsisting at the Latest Practicable Date in which they were materially interested and which was significant in relation to the business of the Group.

7. LITIGATION

The Directors confirm that none of the member of the Group was engaged in any litigation or claims of material importance and no litigation or claim of material importance was pending or threatened against any member of the Group as at the Latest Practicable Date.

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APPENDIX III	GENERAL INFORMATION

8. MATERIAL CONTRACTS

The following contracts (not being contracts entered into in the ordinary course of business) have been entered into by the member of the Group within two years immediately preceding the date of the Circular and are or may be material:

1. a sale and purchase agreement dated 25 June 2018 entered into between the purchaser, an indirect wholly-owned subsidiary of the Company and the vendor, pursuant to which the purchaser conditionally agreed to purchase and the vendor conditionally agreed to sell a property management business at a consideration of RMB9.0 million (equivalent to approximately HK$10.3 million); and
2. a sale and purchase agreement dated 1 March 2019 entered into between the purchaser, a wholly-owned subsidiary of the Company and the vendor, pursuant to which the purchaser conditionally agreed to acquire and the vendor conditionally agreed to sell 700 carpark spaces at a consideration of RMB28.0 million (equivalent to approximately HK$31.9 million).

9. SERVICE CONTRACTS

The Directors confirm that as at the Latest Practicable Date, the Directors did not have any existing or proposed service contract with any member of the Group (excluding contracts to expire or may be terminated by the employer within a year without payment of any compensation (other than statutory compensation)).

10. MISCELLANEOUS

1. The company secretary of the Company is Mr. Poon Yan Wai, who is a Fellow Member of The Hong Kong Institute of Certified Public Accountants. He also holds a Bachelor's degree in Accountancy and a Master's degree in Corporate Finance from Hong Kong Polytechnic University.
2. The registered office of the Company is at Royal Bank of Canada Trust Company (Cayman) Limited, 4th Floor, Royal Bank House, 24 Shedden Road, George Town, KY1-1111, Cayman Islands and the head office and principal place of business in Hong Kong is at Units 314- 315, Wing On Plaza, 62 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong.
3. The principal share registrar and transfer office of the Company in the Cayman Islands is SMP Partners (Cayman) Limited at The Royal Bank House - 3rd Floor, 24 Shedden Road, P.O. Box 1586, Grand Cayman, KY1-1110, Cayman Islands. The branch share registrar and transfer office of the Company in Hong Kong is Hong Kong Registrars Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong.
4. The English text of this circular shall prevail over the Chinese text in case of inconsistencies.

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APPENDIX III	GENERAL INFORMATION

11. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the principal place of business of the Company at Units 314-315, Wing On Plaza, 62 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong during normal business hours on any business day up to and including the date which is 14 days from the date of this circular:

1. the memorandum and articles of association of the Company;
2. the material contract(s) disclosed in the paragraph under the heading ''Material Contracts'' in this Appendix;
3. the annual reports of the Group for the two financial years ended 30 June 2017 and 2018;
4. the interim report of the Group for the six months ended 31 December 2018;
5. the Sale and Purchase Agreement;
6. the Supplemental Agreements; and
7. this circular.

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NOTICE OF EGM

KINGWELL GROUP LIMITED

京 維 集 團 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1195)

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the ''EGM'') of Kingwell Group Limited (the ''Company'') will be held at Event Room 1-2, LG/F, New World Millennium Hong Kong Hotel, 72 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong on 10 October 2019 at 11 a.m. for the purpose of considering and, if thought fit, passing (with or without amendments) the following resolution as ordinary resolutions:

Words and expressions that are not expressly defined in this notice of EGM shall bear the same meaning as that defined in the circular dated 18 September 2019, a copy of which is marked ''A'' and tabled before the EGM and initialled by the chairman of the EGM for identification purpose.

ORDINARY RESOLUTIONS

1. ''THAT:
2. 1. the Sale and Purchase Agreement, pursuant to which the Company conditionally agreed to sell and the Purchaser conditionally agreed to acquire the Sale Shares, being the 35% equity interests in the Target Company, at the Consideration of RMB53.0 million (equivalent to approximately HK$60.4 million); and
   2. the directors of the Company be and is/are hereby authorised to do all such acts and things, to sign and execute all such documents, deeds, acts, matters and things, as the case may be in their discretion consider necessary, desirable or expedient to carry out and implement the Sale and Purchase Agreement and all the transactions contemplated thereunder into full effect.''
3. ''THAT Mr. Lu Lin be re-elected as an independent non-executive director of the Company.''

Yours faithfully,

On behalf of the Board

KINGWELL GROUP LIMITED

Mu Dongsheng

Chairman

Hong Kong, 18 September 2019

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NOTICE OF EGM

Registered office:	Principal place of business in Hong Kong:
Cricket Square	Units 314-315
Hutchins Drive	Wing On Plaza
P.O. Box 2681	62 Mody Road
Grand Cayman	Tsim Sha Tsui East
KY1-1111	Kowloon, Hong Kong
Cayman Islands

Notes:

1. The resolutions set out in this notice of EGM will be taken by poll pursuant to the Listing Rules and the results of the poll will be published on the websites of the Stock Exchange and the Company in accordance with the Listing Rules.
2. Any member entitled to attend and vote at the EGM is entitled to appoint one or more proxies to attend and, on a poll, vote on his/her behalf. A proxy needs not be a member of the Company.
3. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his/her attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer, attorney or other person authorised to sign the same.
4. Completion and return of the form of proxy will not preclude members from attending and voting in person at the EGM or at any adjourned meeting (as the case may be) should they so wish. If the relevant member attends the EGM, the form of proxy shall be deemed to be revoked.
5. In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, must be deposited at the Company's Hong Kong branch share registrar, Hong Kong Registrars Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding the EGM or any adjourned meeting (as the case may be).
6. Whether or not you intend to attend the EGM in person, you are urged to complete and return the form of proxy in accordance with the instructions printed thereon.
7. Where there are joint registered holders of any Share, any one of such joint registered holders may vote at the EGM, either in person or by proxy, in respect of such Share as if he/she was solely entitled thereto, but if more than one of such joint registered holders are present at the EGM, whether in person or by proxy, the joint registered holders present whose name stands first on the register of members of the Company in respect of the Shares shall be accepted to the exclusion of the votes of the other registered holders.
8. The register of members of the Company will be closed, for the purpose of determining the identity of members who are entitled to attend and vote at the EGM, from 3 October 2019 to 10 October 2019, both days inclusive, during which period no transfers of shares will be effected. In order to be eligible to attend and vote at the EGM, all properly completed and duly stamped transfer forms accompanied by the relevant share certificates must be lodged with the Company's Hong Kong branch share registrar, Hong Kong Registrars Limited at Shops 1712-1716, 17th floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, for registration not later than 4:30 p.m. on 2 October 2019.

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