Information Memorandum for the Listing of Kanghong International Trade Co., Ltd
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Dutch Caribbean Securities Exchange, Listing Advisor 荷兰加勒⽐证券交易所上市保荐机构 Information Memorandum For the Listing of Kanghong International Trade Co., Ltd. Incorporated under the laws of BVI Business Companies Act, 2004 (No. 16 of 2004) on May 2nd, 2018 with BVI company number: 1977961 www.chinacccg.com 0 Table of Contents 1. Summary of Certain Defined Terms ....................................................................................................... 2 2. Important Information and Notices ......................................................................................................... 3 3. Issuer and the List of Institutions Related to the Listing ........................................................................ 6 4. Company Overview ................................................................................................................................ 7 4.1 Business Structure ................................................................................................................................................ 7 4.2 About the Company .............................................................................................................................................. 8 4.3 Company’s Operation ........................................................................................................................................... 8 5. Terms of the Issuance and Investment Overview ................................................................................. 10 6. Business Overview ................................................................................................................................ 12 6.1 Executive Summary ........................................................................................................................................... 12 6.2 Products and Services ........................................................................................................................................ 13 6.3 Marketing Strategy ............................................................................................................................................ 15 6.4 Development Strategy ....................................................................................................................................... 17 6.5 Business Partners ............................................................................................................................................... 19 6.6 Permit and License ............................................................................................................................................ 20 6.7 Related Parties ................................................................................................................................................... 22 6.8 Main Competitors .............................................................................................................................................. 29 7. Company Advantages and Investment Highlights ................................................................................ 31 7.1 Strong Market Demand ....................................................................................................................................... 31 7.2 Wide Product Offerings ...................................................................................................................................... 31 7.3 Great Brand Reputation....................................................................................................................................... 31 7.4 Promising Expansion Plan .................................................................................................................................. 31 8 Directors and Senior Management............................................................................................................. 32 9 Financial Statements .................................................................................................................................. 36 10 Material Contract and Agreement .............................................................................................................. 78 11 Risk Factors and Litigation ........................................................................................................................ 79 1 1. Summary of Certain Defined Terms “The Company / Kanghong” Kanghong International Trade Co., Ltd. (BVI Company Number: 1977961), a company incorporated under the laws of the British Virgin Islands and having its registered address at the offices of Vistra Corporate Services Centre, Wickhams Cay II, Road Town, Tortola, VG1110, British Virgin Islands, is the holding company that indirectly owns 100% of the outstanding shares of Shidian Kanghong Agricultural Technology Development Co., Ltd. “KH” Shidian Kanghong Agricultural Technology Development Co., Ltd., a company incorporated under the laws of People’s Republic of China and having its registered address at Jiaochangba, Wanxing Village, Wanxing Town, Shidian County, Baoshan City, Yunnan Province, China, and an indirect wholly-owned subsidiary of the Company. “DCSX” The Dutch Caribbean Securities Exchange. “ACT” The BVI Business Companies Act, 2004 (No. 16 of 2004) including any modification, extension, re-enactment or renewal thereof and any regulations made thereunder. “IFRS” International Financial Reporting Standards, the set of international accounting standards stating how particular types of transactions and other events should be reported in financial statements. “LAD” Listing Advisor. “Chucheng Capital” Shanghai Chucheng Investment Management Co. Ltd. “Listing Rules” The Listing Rules of the DCSX. 2 2. Important Information and Notices Dear investors, This Information Memorandum for listing has been approved by Kanghong International Trade Co., Ltd. (BVI Company Number: 1977961, the “Company”). The sole purpose of this Information Memorandum is to list the presently outstanding ordinary shares of the Company on the Dutch Caribbean Securities Exchange N.V. (“DCSX”) in Curacao (Dutch Caribbean). Curacao is a country within the Kingdom of the Netherlands. The listed shares will be replaced on a one to one basis by listed Depository Receipts (DR’s) upon completion of the official issuance of such DR’s in full accordance with the legal and procedural requirements of the issuance and listing of such DR’s as demanded by the DCSX. This Information Memorandum does not contain all the information that a future investor should consider before investing. Potential investors should not regard the content of this Information Memorandum as advice on any matters relating to the investment, including but not limited to issues of legality, taxation, or finance, nor as recommendation, instruction for the subscription, purchase, holding or disposition of the securities. Every potential investor should consult his or her independent professional advisor to evaluate the strengths and risks of investing in the Company. You and your advisors must rely on your investigations about the Company's stocks and listing clauses to assess the advantages and risks. This Information Memorandum does not constitute or form any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe to any securities. Neither this Information Memorandum nor the publication of the information contained herein is intended to be any inducement to sign any contract, and in no event shall it be construed so in any jurisdiction. This Information Memorandum may be withdrawn at any time before the proposed listing. This Information Memorandum is intended to provide information to prospective investors in their evaluation of the investment and should only be used for this purpose. The Company may consider future (initial) public offering, in which case, the Company will make more information available to investors in due course and as appropriate. The Company expressly reserves the right to reject any or all tender offer or proposed investment in its sole discretion, and at any time to notify any potential investor to terminate the discussion. Furthermore, the Company reserves the right to withdraw, supplement, alter, modify, sort, or reduce the scope of, or the content of this Information Memorandum, in each case subject to the rules and regulations of the DCSX. This Information Memorandum contains forward-looking statements concerning plans, objectives, goals, strategies presented by the Company in the form of projections or expectations of revenues, income (or loss), earnings (or loss) per share, or other financial projections. These statements include the words such as “'believe”, “estimate”, “expect”, “intend”, “may”, “will”, “shall”, “may”, or “should” and other expressions of similar nature, and they address matters that involve risks and uncertainties. Forward-looking statements are based on an assessment of the economic developments, operating conditions, and certain assumptions regarding the future events and actions that are current views of the Company and/or the Directors as of the date of this Information Memorandum. As a result, these forward-looking statements are not the guarantees of future performance, and many known and unknown risks, unexpected uncertainties, assumptions and other important factors other than the Company, the Directors and the Management of the Company could cause actual results to differ materially from those