SCHEDULE 14A
Information Required in Proxy Statement
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant |x|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
|x| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
EURO TECH HOLDINGS COMPANY LIMITED
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|x| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by Registration Statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: ____________________________________________
2) Form, Schedule or Registration Statement No.: ______________________
3) Filing Party: ______________________________________________________
4) Date Filed: ________________________________________________________
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Euro Tech Holdings Company Limited
18/F Gee Chang Hong Centre
65 Wong Chuk Hang Road
Hong Kong
NOTICE OF ANNUAL MEETING
OF
SHAREHOLDERS
PLEASE TAKE NOTICE that the 1999 Annual Meeting of Shareholders of Euro
Tech Holdings Company Limited (the "Company") will be held at the Luk Kwok
Hotel, 72 Gloucester Road, Wanchai, Hong Kong, on Wednesday, September 29, 1999
at 4:00 P.M. local time for the following purposes:
1. to elect seven persons to serve on the Company's Board of Directors
until the next Annual Meeting of Shareholders or until their
respective successors are duly elected and qualified as provided in
the Company's Memorandum and Articles of Association;
2. to confirm and ratify the retention of Arthur, Andersen & Co., Hong
Kong, as the Company's independent auditors for the fiscal year to
end December 31, 1999; and
3. to transact such other and further business as may properly come
before the meeting or any adjournment(s) thereof.
Shareholders of record at 5:00 p.m. (New York time) on September 3, 1999,
are entitled to notice of and to vote at the meeting.
By Order of The Board of Directors
Jerry Wong, Secretary
September 3, 1999
<PAGE>
Euro Tech Holdings Company Limited
18/F Gee Chang Hong Centre
65 Wong Chuk Hang Road
Hong Kong
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
ON SEPTEMBER 29, 1999
GENERAL INFORMATION
This Proxy Statement and the accompanying Notice of Annual Meeting and
proxy are being furnished in connection with the solicitation of proxies by the
Board of Directors of Euro Tech Holdings Company Limited (the "Company") for use
at the Company's Annual Meeting of Shareholders (the "Annual Meeting") to be
held on Wednesday, September 29, 1999 at the Luk Kwok Hotel, 72 Gloucester
Road, Wanchai, Hong Kong, at 4:00 P.M. local time and at any adjournments
thereof. The matters to be acted upon at the Annual Meeting are set forth in the
Notice of Annual Meeting. This Proxy Statement and a proxy are scheduled to be
mailed to shareholders commencing on September 3, 1999.
Only holders of Common Stock of record on the books of the Company at 5:00
p.m. (New York time) on September 3, 1999 (the "Record Date") will be entitled
to notice of and to vote at the meeting. On August 6, 1999, there were 2,068,200
shares of Common Stock of the Company outstanding and approximately 11 holders
of record (the "Recordholders"). The Company believes these to be approximately
350 beneficial owners of the Common Stock.
On September 3, 1999, the Company declared a dividend to the
Recordholders. The dividend provides each Recordholder one (1) share of Common
Stock per five (5) shares of Common Stock held on the Record Date by the
Recordholder (the "Stock Dividend"). The Stock Dividend will be deemed effective
at the opening of business on the day after the Record Date. As a result,
calculations contained herein regarding the Company's securities do not give
effect to the issuance of the Stock Dividend.
The cost of soliciting proxies will be borne by the Company. Directors,
officers and employees of the Company may solicit proxies by telephone, telegram
or personal interview. The cost for such services is estimated at $1,000,
including expenses.
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If a shareholder specifies on the accompanying proxy how shares are to be
voted, they will be voted accordingly. If the shareholder does not specify on
the proxy card how the shares are to be voted, they will be voted FOR the
election of directors, and the confirmation of the appointment of Arthur
Andersen & Co., Hong Kong as independent auditors for the Company's fiscal year
ended December 31, 1999. A shareholder may revoke a proxy by giving written
notice to the Secretary of the Company at or prior to the meeting or by voting
at the meeting.
The presence, in person or by proxy, of shareholders entitled to cast at
least a majority of the votes which all shareholders are entitled to cast
constitutes a quorum for the purposes of transacting business at the meeting.
Each outstanding share of the Company's Common Stock is entitled to one vote on
each matter which may be properly brought before the Annual Meeting. Each
director nominee must receive the affirmative vote of a simple majority of the
stock having voting power and that did not abstain in order to be elected as a
director and to ratify the appointment of the auditors for the fiscal year
ending December 31, 1999, the affirmative vote of a simple majority of the stock
having voting power and that did not abstain is also required.
PROPOSAL I
ELECTION OF DIRECTORS
At the Annual Meeting, seven directors will be elected to serve until the
next Annual Meeting of Shareholders or until each of their respective successors
has been duly elected and qualified as provided in the Memorandum and Articles
of Association.
Unless otherwise indicated on the proxy, votes pursuant to the
accompanying proxy will be cast for the election of the nominees on the proxy,
provided that, if any of the nominees named below shall become unavailable to
serve as a director prior to the meeting, the shares represented by valid
proxies shall be voted for the election of such other person as the Board may
recommend in his or her place, or the number of directors to be elected shall be
decreased. The Board of Directors has no reason to believe that any nominee will
be unable to serve.
T.C. Leung, Jerry Wong, Nancy Wong, C.P. Kwan, Alex Sham, Adam L.
Goldberg, and Y.K. Liang have been nominated for election to the Board of
Directors and each has consented to serve as such, if elected. Each of the
nominees who has been nominated for election as a director commencing at the
conclusion of the Annual Meeting, is currently a director. In order to be
elected, each such nominee must receive the affirmative vote of a simple
majority of the votes of the shares entitled to vote thereon and were voted and
not abstained.
The enclosed proxy gives shareholders the following options: (A) vote for
all director nominees; (B) vote against all director nominees; (C) vote for only
director nominee(s) they specify; (D) vote against only director nominee(s) they
specify; and (E) abstain.
The directors and executive officers of the Company are as follows:
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Name Age Position
---- --- --------
T.C. Leung 55 Chairman of the Board of Directors
and Chief Executive Officer
Jerry Wong 39 Director and Chief Financial Officer
Nancy Wong 49 Director
C.P. Kwan 39 Director
Alex Sham 35 Director
Adam L. Goldberg 40 Director
Y.K. Liang 69 Director
Set forth below is a brief background of the executive officers and
directors based upon the information supplied by them:
T.C. Leung has been Chief Executive Officer and Chairman of the Board of
Directors of both the Company and Far East since their inception. Before
establishing Far East, Mr. Leung was an engineer for English Electric in
England, from 1965 to 1968, and Lockheed Aircraft in Hong Kong, from 1968 to
1970. Mr. Leung also served as managing director of Eurotherm (Far East) Ltd.
between 1971 and 1992. Since 1988, Mr. Leung has also served as managing
director of Eurotherm Hong Kong. Mr. Leung received a Masters degree in Business
Administration from the University of East Asia, Macao in 1986 and is a
Chartered Engineer, a title bestowed upon a member of the Council of Engineering
Institutions in the United Kingdom.
Jerry Wong has served as Director and Chief Financial Officer of Far East
since 1994 and has been with Far East since 1987. Mr. Wong has been the Chief
Financial Officer and a Director of the Company since its inception. From 1985
until 1987, Mr. Wong worked for MUA Agencies Ltd., a subsidiary of a Hong Kong
publicly listed company engaged in the insurance business, as deputy manager of
its secretarial, legal and accounting department. From 1981 until 1985, Mr. Wong
served as a senior accountant in Price Waterhouse-Hong Kong. He is a Fellow of
the Chartered Association of Certified Accountants in the United Kingdom and a
Certified Public Accountant in Hong Kong.
Nancy Wong has been a Director of the Company since its inception and a
Director of Far East, and its Personnel Manager, since 1994. Ms. Wong has been
with Far East since 1971. Ms. Wong is also Far East's Chief Representative in
China. During the last several years, Ms. Wong has played a pivotal role in Far
East's business expansion in China. Ms. Wong
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received a Bachelor of Science degree in Business Administration from the
University of East Asia, Macao in 1989.
C.P. Kwan joined Far East in 1984 and has served as a Director and Manager
of its Process Equipment Department since 1991. Mr. Kwan has been a Director of
the Company since its inception. Before joining Far East, he was employed by
Haven Automation (H.K.) Ltd., a company involved in the water treatment and
process control business between 1981 and 1984.
Alex Sham has been a Director of the Company since its inception. Mr. Sham
joined Far East in 1988 and has been its Sales Manager since 1993 and became a
Director of Far East in 1996. Mr. Sham received a Bachelor of Science in Applied
Chemistry from Hong Kong Baptist University in 1990. Prior to joining Far East,
Mr. Sham was employed by the Environmental Protection Department of the Hong
Kong Government from 1986 until 1988.
Adam L. Goldberg has been a director of the Company since February 16,
1998. Mr. Goldberg is an attorney who has maintained his own practice in New
York City since 1993. From 1989 until 1993, Mr. Goldberg was employed as a staff
attorney with the New York City Department of Housing Preservation and
Development. Mr. Goldberg is the designee of May Davis Group, Inc., the
underwriter of the Company's initial public offering.
Y.K. Liang has been a director of the Company since February 16, 1998. Mr.
Liang is a director of Wong Liang Consultants Ltd. ("Consultants") and a member
of the certified public accounting firm of Y.K. Liang & Co. ("LCO"). Mr. Liang
has been associated with both Consultants and LCO for more than the past five
years. Consultants is a general business consulting firm.
Directors of the Company serve until the next annual meeting of
shareholders of the Company and until their successors are elected and duly
qualified. Officers of the Company are elected annually by the Board of
Directors and serve at the discretion of the Board of Directors.
The Company believes that none of its directors, officers or beneficial
owners of ten percent or more of its Common Stock are required to file any
reports pursuant to Section 16(a) of the Securities Exchange Act of 1934, as
amended (the "1934 Act").
The Company had five meetings of its Board of Directors during Fiscal
1998. Messrs. Leung, Goldberg and Liang are the members of the Company's Audit
Committee. The Company presently does not have standing nominating or
compensation committees.
The Company has not had any directors resign or decline to stand for
re-election at any time during or since December 31, 1998.
There are no material legal proceedings involving any director, officer or
affiliate of the Company, owner of record or beneficially of more than five
percent of the Company's Common Stock or any associate of any of the foregoing.
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Executive Compensation
The following table sets forth certain summary information with respect to
the compensation paid by Far East for services rendered in all capacities to Far
East during Fiscal 1998 and Fiscal 1997 by Far East's Chairman of the Board and
Chief Executive Officer.
Summary Compensation Table
Name and Principal Position Year Salary ($) Bonus ($)
---- ---------- ---------
T.C. Leung, Chairman of the Board of 1998 100,000 30,000
Directors and Chief Executive Officer 1997 78,890 32,269
Compensation of Directors
Directors of the Company do not receive compensation for their services as
directors; however, the Board of Directors may authorize the payment of
compensation to directors for their attendance at regular and special meetings
of the Board and for attendance at meetings of committees of the Board as is
customary for similar companies. Directors will be reimbursed for their
reasonable out-of-pocket expenses incurred in connection with their duties to
the Company.
Pension Plan
The Company has a defined contribution pension plan for all of its
employees. Under this plan, all employees are entitled to a pension benefit
equal to 50% to 100% of their individual fund account balances at their dates of
resignation or retirement which depends on their years of services. The Company
is required to make specific contributions at approximately 10% of the basic
salaries of the employees to an independent fund management company. The Company
has no future obligations for the pension payment or any post-retirement
benefits beyond the annual contributions made. The independent fund management
company is responsible for the ultimate pension liabilities to those resigned or
retired employees. During the years ended December 31, 1996, 1997 and 1998, the
Company made total pension contributions of approximately $53,500, $115,000 and
$127,000, respectively.
Employment Agreement - T.C. Leung
T.C. Leung's services to the Company and Far East are provided pursuant to
a five year personal services agreement between the Company, Far East and
Shereman Enterprises Ltd., a management company, pursuant to which Mr. Leung
will continue to serve as the Chairman of the Board of Directors and Chief
Executive Officer of the Far East and the Company. The agreement requires that
Mr. Leung devote substantially all of his business time to the affairs of the
Company and Far East. The agreement provides for the payment of $100,000 and six
percent of the Company's consolidated pre-tax income to the management company
in exchange for Mr. Leung's services during the first year of the agreement's
term with compensation past the first
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year to be renegotiated annually. The agreement contains a confidentiality
provision and a covenant not to compete with the Company or Far East for a
period of one year following termination of the agreement under certain
circumstances.
Stock Option Plan
In November 1996, the Board of Directors adopted the Company's 1996 Stock
Option Plan (the "1996 Stock Option Plan" or, the "Plan"). As certain net income
thresholds were not met, no options may be granted under the Plan.
Management Option Plan
The Company has authorized the issuance of 1,400,000 Options to purchase
up to an aggregate of 1,400,000 shares of Common Stock (the "Management
Options") to its officers, directors and employees in such numbers and to such
persons as the Company's Chairman of the Board and Chief Executive Officer may
direct. The Management Options became exercisable on March 14, 1998 for a term
of ten years.
The exercise price and the number of shares of Common Stock purchasable
upon exercise of any Management Options are subject to adjustment upon the
occurrence of certain events, including stock dividends, reclassification,
reorganizations, consolidations, mergers, and certain issuances and redemptions
of Common Stock and securities convertible into or exchangeable for Common Stock
excluding certain issuances of shares of the Company's Common Stock. No
adjustments in the exercise price will be required to be made with respect to
the Management Options until cumulative adjustments amount to $.05. The Stock
Dividend declared by the Company on September 3, 1999 will cause an adjustment
of the exercise price and the number of shares of Common Stock purchasable upon
exercise of the Management Options. Such adjustment will become effective at the
opening of business on September 4, 1999. As a result, the exercise price and
the number of shares of Common Stock purchasable upon exercise of the Management
Options, as listed in the table below, does not take into account the adjustment
that will be required in light of the issuance of the Stock Dividend.
In the event of any capital reorganization, certain reclassifications of
the Common Stock, any consolidation or merger involving the Company (other than
(i) a consolidation or merger which does not result in any reclassification or
change in the outstanding shares of Common Stock or (ii) the acquisition of Far
East or any other business), or sale of the properties and assets of the
Company, as, or substantially as, an entirety to any other corporation,
Management Options will thereupon become exercisable only for the number of
shares of stock or other securities, assets, or cash to which a holder of the
number of shares of Common Stock of the Company purchasable (at the time of such
reorganization, reclassification, consolidation, merger, or sale) upon exercise
of such Management Options would have been entitled upon such reorganization,
reclassification, consolidation, merger, or sale.
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<PAGE>
The table below shows, as to each of the executive officers and directors
of the Company and as to all executive officers and directors of the Company as
a group, the following information with respect to Management Options: (i) the
aggregate amounts of shares of Common Stock subject to Management Options; and
(ii) the per share exercise price for the Management Options granted to these
individuals. No other options to these individuals were issued and outstanding
as of December 31, 1998.
Shares Per Share
Name of Executive Subject Exercise
Officers and Directors to Options Price
- ---------------------- ---------- -----
T.C. Leung........................................... 750,000 $5.50
350,000 $4.00
Alex Sham............................................ 30,000 $5.50
20,000 $4.00
Jerry Wong........................................... 25,000 $5.50
15,000 $4.00
Nancy Wong........................................... 22,500 $5.50
7,500 $4.00
C.P. Kwan............................................ 22,500 $5.50
7,500 $4.00
All Executive Officers and
Directors as a group
(7 persons).......................................... 1,250,000 $4.00-$5.50(1)
Other officers and/or employees of the Company have been or will be
granted management options to purchase an aggregate of 150,000 Management
Options, all of which will be exercisable at $5.50 per share.
As of August 1, 1999, no Management Options have been exercised.
VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF
The following table sets forth, as of August 1, 1999, certain information
concerning beneficial ownership of shares of Common Stock with respect to (i)
each person known to the
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1 Price range.
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Company to own 5% or more of the outstanding shares of Common Stock and (ii) all
officers and directors of the Company as a group:
Amount and Approximate
Nature of Percentage
Beneficial of Common
Ownership Stock Owned
--------- -----------
T.C. Leung(1)(2)(3).................... 2,524,000 79%
Pearl Venture Ltd.(1)(2)............... 2,524,000 79%
Regent Earning Ltd.(1)................. 1,027,600 50%
All Executive Officers and
Directors of the Company as
a group (7 persons)(4)................. 2,674,000 81%
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company was incorporated under the laws of the British Virgin Islands
on September 30, 1996. Shortly after incorporation, the Company sold 50,000
shares of its Common Stock to Gusrae, Kaplan & Bruno and 100,000 shares of its
Common Stock to Sidford for aggregate cash consideration of $1,500 or $.01 per
share. Gusrae, Kaplan & Bruno is United States counsel to the Company and was
granted the right to purchase said shares in partial
- --------
(1) The address for Mr. Leung is c/o Euro Tech (Far East) Ltd., 18/F Gee
Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong. The address for Pearl
Venture Ltd. ("Pearl") is Columbus Centre Building, Wichhams Cay, Road Town,
Tortola, British Virgin Islands. The address for Regent Earning Ltd. ("Regent")
is Room 101, Chong Kin Commercial Building, No. 11 Wing Ho Street, Central Hong
Kong.
(2) Includes shares of the Company's Common Stock owned of record by
Pearl, which is a trust established for the benefit of Mr. Leung. Also includes
those shares of the Company's Common Stock owned of record by Regent, of which
Pearl is the majority shareholder. See Item 13. "Interest of Management in
Certain Transactions."
(3) Does not include such person's proportionate interest in shares of the
Company's Common Stock held of record by Regent or Broadskill Investments Inc.
("Broadskill"). Broadskill is a Hong Kong corporation which owns an approximate
34% equity interest in Regent. See Item 13. "Interest of Management in Certain
Transactions."
(4) Gives effect to the exercise of Management Options owned of record by
the Company's executive officers and directors. See Item 13. "Interest of
Management in Certain Transactions."
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<PAGE>
consideration of its services rendered to the Company in connection with the
Company's initial public offering ("Public Offering"). Sidford has been and is a
business consultant to Far East which initially was paid HK$5,000 by Far East
and granted the option to purchase the aforementioned 100,000 shares. In January
1997, Far East amended its consulting agreement with Sidford to pay Sidford
$5,000 per month for twenty months. At that same time, the Company repurchased
the 100,000 shares of its Common Stock held by Sidford.
Pearl is a British Virgin Islands company which is a trust for the benefit
of T.C. Leung, the Company's Chairman of the Board and Chief Executive Officer.
Regent is a Hong Kong corporation.
Concurrently with the closing of the Company's Public Offering in March of
1997, the Company consummated the acquisition of Far East by exchanging
1,400,000 shares of the Company's Common Stock for the 1,000,000 issued and
outstanding shares of the Common Stock of Far East at a ratio of 1.4 (one and
four-tenths) shares of the Company's Common Stock for each issued and
outstanding share of Far East's Common Stock.
Mr. Leung may be deemed to be a "promoter" of the Company as such term is
defined by the rules promulgated by the Commission under the Securities Act. As
so defined, a promoter is any person who (i) acting alone or in conjunction with
others, took the initiative in founding and organizing an issuer's business or
enterprise, or (ii) in connection with founding and organizing the business or
enterprise of an issuer, receives in consideration for services and/or property,
ten percent or more or either of any class of the issuer's securities or the
proceeds therefrom. Mr. Leung was the proponent of the Public Offering to raise
capital for the Company and Far East and of establishing a company in the
British Virgin Islands for that purpose. Mr. Leung is the beneficial owner of
approximately 79% of the Company's shares of Common Stock after giving effect to
the exercise of the 1,100,000 Management Options owned by him.
The Company intends that all transactions between the Company and its
executive officers and directors be on terms no less favorable than could be
obtained from independent third parties and be approved by a majority of the
Company's directors who are not interested in such transactions.
All outstanding balances with related parties are unsecured, non-interest
bearing and are repayable in 1999. The related companies with which the Company
has engaged in transactions are Euro Electron, Eurotherm, Action and Armtison.
During Fiscal 1998 the Company made sales to Action and Eurotherm of
approximately $4,000, and $48,000, respectively. During Fiscal 1998 the Company
made purchases from Action, Armtison and Eurotherm of approximately $24,000,
$56,000 and $491,000, respectively. Additionally, during Fiscal 1998, the
Company paid approximately $46,000 to Armtison for office space rentals, and
approximately $25,000 in management fees to Eurotherm to assist in the
management of some of the Company's PRC offices. The payments to Armtison and
Eurotherm were based on actual office space usage and the time cost of personnel
used, respectively.
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No loans or advances have been or will be made in the future to the
Company's officers, directors or shareholders of at least five (5%) percent of
the issued and outstanding shares of any class of equity securities ("5%-plus
Shareholders"), or their respective affiliates unless such loans are for bona
fide business purposes.
In connection with the Public Offering, the Company sold to May Davis, for
the sum of $10.00, Warrants to purchase up to 60,000 shares of the Company's
Common Stock at $8.25 and Warrants, at a price of $.2475 per Warrant to purchase
up to an additional 60,000 shares of the Company's Common Stock at $5.50 per
share (the "May Davis Warrants") which are exercisable until March 14, 2002. For
the life of the May Davis Warrants, the holders thereof are given the
opportunity to profit from a rise in the market price of the Warrants and/or
Common Stock of the Company with a resulting dilution in the interest of other
securityholders. The Company may find it more difficult to raise additional
equity capital if it should be needed for the business of the Company while the
May Davis Warrants are outstanding, and at any time when the holder of the May
Davis Warrants might be expected to exercise them, the Company would probably be
able to obtain additional equity capital on terms more favorable than those
provided in the May Davis Warrants. The Company has agreed, at its expense, to
register under the Act, on one occasion, and at May Davis' expenses on another
occasion, the May Davis Warrants and/or the underlying securities at the request
of the holder thereof. The Company has also agreed to certain "piggy-back"
registration rights for the holders of the May Davis Warrants and securities
issuable upon exercise thereof.
On October 16, 1998, the Company repurchased a portion of the May Davis
Warrants. The Company purchased the right to obtain 60,000 warrants and said
right to thereby acquire 60,000 shares at an exercise price of $5.50 and any and
all rights, and powers granted pursuant to the May Davis Warrants relating to
the warrants and the Shares in consideration of the sum of $75,150.
May Davis had indicated its desire to exercise the demand registration
rights. The Company reviewed the situation and determined that to file a new
registration statement or post-effective amendment to its registration
statement, the cost to the Company would far exceed $75,000.
The Company has also agreed with May Davis, that if the Company, its
current or future subsidiaries, if any, and its principal shareholders, or their
respective affiliates, will until March 14, 2000 provide May Davis with a Right
of First Refusal with respect to any public or private offering of securities to
raise capital. May Davis must agree to undertake any such financing on the same
or better terms as any other financing proposal.
The Company has agreed that for a period of time ending not earlier than
March 14, 2000, May Davis will have the right to designate a person to be a
non-voting advisor to the Company's Board of Directors who will receive the same
compensation as a member of the Board of Directors and who will be indemnified
by the Company against any claims arising out of his participation at meetings
of the Board of Directors. Alternatively, May Davis has the right, during
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such period, to designate one person to be elected to the Company's Board of
Directors. The Company has agreed to use its best effort to obtain the election
of the May Davis designee and such person shall be entitled to receive the same
compensation, expense reimbursement and other benefits as any other non-employee
Director of the Company, if any. May Davis has designated Mr. Goldberg for the
Company's Board of Directors. At the completion of the Public Offering, the
Company retained May Davis to act as a financial consultant for a period of time
concluding on March 14, 2000 for fees aggregating $108,000 which were paid in
full at that time.
PROPOSAL II
APPROVAL OF AUDITORS
The Board of Directors, upon the recommendation of the Company's Audit
Committee, have selected Arthur Andersen & Co., Hong Kong, a certified public
accounting firm, as independent auditors of the Company's financial statements
for its fiscal 1999 to end December 31, 1999. A representative of Arthur
Andersen & Co., Hong Kong is expected to be present at the Annual Meeting and
will have an opportunity to make a statement if he desires to do so. The
representative is expected to be available to respond to appropriate questions.
The members of the Board of Directors recommend that the shareholders vote
"FOR" the proposal to approve Arthur Andersen & Co., Hong Kong as the Company's
auditors for its fiscal year ending December 31, 1999. In order to be so
approved Arthur Andersen & Co., Hong Kong must receive the affirmative vote of a
simple majority of the votes of the shares entitled to vote thereon and were
voted and not abstained.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Any shareholder proposals intended to be considered for presentation at
the 2000 Annual Meeting and for inclusion in the 2000 proxy statement must be
made in writing and received by the Corporate Secretary at the Company's
principal executive offices by April 1, 2000. The Company will consider only
proposals meeting the requirements of applicable Securities and Exchange
Commission rules. Shareholders are urged to review these rules and, if questions
arise, consult their own legal counsel before submitting a proposal to the
Company.
Recommendations by shareholders for directors to be nominated at the 2000
Annual Meeting must be made in writing, with sufficient biographical and other
relevant information such that an informed judgment as to the proposed nominee's
qualifications can be made and be accompanied by a notarized written consent to
be named in the Proxy Statement, if nominated, and to serve as a director, if
elected, executed by the proposed nominee. Recommendations received in proper
order by the Corporate Secretary at the Company's principal executive office at
least four months prior to the 2000 Annual Meeting will be referred to, and
considered by, the Company's Board of Directors. No shareholder recommendations
were received before the 1999 Annual Meeting.
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FINANCIAL STATEMENTS
Consolidated financial statements for the Company and its subsidiaries are
contained in the Company's Annual Report for the fiscal year ended December 31,
1998, as amended, which has been previously sent to you or is being delivered to
you herewith.
OTHER MATTERS
The Board of Directors is not currently aware of any other matter to be
transacted at the Annual Meeting.
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PROXY FRONT
EURO TECH HOLDINGS COMPANY LIMITED
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints T.C. Leung and Jerry Wong
and each of them, with full power of substitution, as proxies to represent the
undersigned and vote all the Ordinary Shares of Euro Tech Holdings Company
Limited, which the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held on September 29, 1999, at 4:00 P.M. local time at the
Luk Kwok Hotel, 72 Gloucester Road, Wanchai, Hong Kong and at any adjournments
thereof, in the following manner:
Management recommends that you vote FOR Proposal 1 and FOR Proposals 2 and
3.
1. |_| For all nominees listed below, except any nominee(s) for whom
authority to vote has been withheld in the manner specified below.
T.C. Leung, Jerry Wong, Nancy Wong, C.P. Kwan, Alex Sham
Adam L. Goldberg and Y.K. Liang.
|_| Against all nominees listed above.
|_| For only those nominees listed below. Instructions: To grant
authority to vote for any specific nominee(s), you must write the name or names
of such nominees in the following space: ______________________________________
|_| Against only those nominees listed below. Instructions: To
withhold authority to vote for any specific nominee(s), you must write the name
or names of such nominees in the following space: ____________________________
|_| Abstain
2. Proposal to ratify the appointment of Arthur Andersen & Co., Hong
Kong as auditors for the 1999 fiscal year.
|_| FOR |_| AGAINST |_| ABSTAIN
3. IN ACCORDANCE WITH THEIR BEST JUDGMENT, the Proxy is authorized to
vote upon any other matter which may properly come before the Meeting.
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<PAGE>
PROXY BACK
(continued from other side)
THIS PROXY, IF PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED HEREIN. UNLESS
OTHERWISE DIRECTED, OR IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR
THE ELECTION OF THE DIRECTOR NOMINEES NAMED ON THE REVERSE SIDE AND FOR
PROPOSALS 2 and 3.
Date:___________________________, 1999
______________________________________
Signature
______________________________________
Signature if jointly held
Please date and sign exactly as your
name appears hereon. If shares are
jointly held, all joint owners should
sign. Trustees and others signing in a
representative capacity in which they
sign. If the signatory is a
corporation or partnership, sign the
full corporate or partnership name by
a duly authorized officer or partner.
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