Wisetong Financial News APP, Chaoda Modern (00682) announced that the board of directors recommends implementing a stock reorganization, including recommending stock consolidation and proposed reduction and splitting of stocks.

(1) Proposal for Stock Consolidation

Stock consolidation is based on consolidating every 20 shares of existing issued and unissued shares with a par value of HK$0.10 each into 1 share with a par value of HK$2.00 each.

(2) Proposal for Stock Reduction and Splitting

Following the effective date of the stock consolidation, the reduction of share capital and the subdivision will be carried out in the following manner:

(i) Stock Reduction, based on this (a) any remaining consolidated shares in the company's issued capital resulting from the stock consolidation will be cancelled, and (b) the company's issued capital will be reduced by canceling the share capital limited to HK$1.99 per issued consolidated share, thereby reducing the company's issued share capital, reducing the face value per issued consolidated share from HK$2.00 to HK$0.01 after this reduction, to become a new share;

(ii) The proceeds from the reduction of share capital will be used to offset the cumulative losses of the company as of the effective date of the reduction of share capital, thereby reducing the company's cumulative losses; and

(iii) Shortly after the effective date of the reduction of share capital, each statutory but unissued consolidated share will be subdivided into 200 shares of new statutory but unissued shares with a par value of HK$0.01 per share. In accordance with the company's articles of association and rules, the new shares will have equal status in all respects.

In addition, the trading unit for buying and selling existing shares on the Hong Kong Stock Exchange will be changed from 2,000 existing shares per unit to 0.01 million combined shares per unit, subject to the effective date of the share consolidation. After the effective date of changing the trading unit per unit, shareholders can return the existing shares of 2,000 existing shares per unit to the share transfer registrar and receive new shares of 0.01 million combined shares per unit, with the costs borne by the company.