ORIENTAL TEXTILE PRODUCTS LTD v. ASIA TELEVISION HOLDINGS LTD AND OTHERS

HCMP 1572/2025

 [2025] HKCFI 5387

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1572 OF 2025

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BETWEEN

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REASONS FOR JUDGMENT

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I. INTRODUCTION

1.  On 31 October 2025, the substantive hearing of the Originating Summons filed by the Plaintiff on 11 September 2025 (the “Originating Summons”) took place before me. At the outset of the hearing, I granted leave for the Plaintiff to amend the Originating Summons as per the Amended Originating Summons. After hearing submissions, due to the urgency caused by a hearing on 19 November 2025 of a winding up petition presented against the 1^st Defendant, I delivered the judgment and my brief reasons for it in the afternoon the same day, with the full judgment now being handed down.

2.  By the Amended Originating Summons, the Plaintiff sought the following:-

“12 August EGM

1. A declaration that the extraordinary general meeting of the 1^st Defendant held on 12 August 2025 (“12 August EGM”) is validly convened;

2. A declaration that the resolutions passed at the 12 August EGM thereat are valid;

3. A declaration that the 2^nd to 6^th Defendants have been removed from the Board of Directors of the 1^st Defendant effective on 12 August 2025;

4. An injunction that the 2^nd to 6^th Defendants (directly or indirectly, whether by himself, his servants, nominees or agents or otherwise) are restrained from:-

a. acting or holding themselves out as director and/or authorised agent of the 1^st Defendant;

b. acting on behalf of the 1^st Defendant or the Board of Directors of the 1^st Defendant;

Resumed EGM

4A. Alternative to paragraphs 1 to 4 above:-

(a) A declaration that the decision of the 1^st Defendant to adjourn the extraordinary general meeting of the 1^st Defendant held on 27 August 2025 (“27 August EGM”) is invalid, void or voidable…

(b) The 2^nd to 6^th Defendants do within 7 days give or procure to give notice to members of the 1^st Defendant for the resumption of the adjourned 12 August EGM and/or 27 August EGM (“Resumed EGM”) pursuant to Article 64 of the 1^st Defendant’s Amended and Restated Articles of Association (“Articles”)…”

3.  The order I granted was in terms of paragraphs 1 to 4 of the Amended Originating Summons. The reasons I delivered for granting the order are now reproduced in §§37 to 56 below. In this full judgment, I shall set out the necessary background for a better understanding of the reasons.

II. PARTIES

4.  The Plaintiff is a company incorporated in Hong Kong. It is a shareholder of the 1^st Defendant (the “ListCo”), listed on the Hong Kong Stock Exchange (“HKEX”) since 30 March 2006. Mr Zha Xiaogang (“Mr Zha”) is the sole director of the Plaintiff. His daughter Ms Zha Mengling (“Ms Zha”) is an executive director of the ListCo, whose duties have since 29 July 2025 been suspended. Ms Zha’s husband Mr Zhang Jingyuan (“Mr Zhang”) beneficially owns the Plaintiff.

5.  The ListCo is incorporated under the laws of Cayman Islands, and is registered as a non-Hong Kong company under the Companies Ordinance (Cap. 622) (the “CO”). Its total number of issued shares is 2,228,826,200 shares. Together with its group of companies, I shall refer to them collectively as the “ATV Group”.

6.  Out of the issued shares:-

(1) 165,000,000 shares (representing approximately 7.40% of the entire issued shareholding) are held in the Plaintiff’s securities account maintained with Shanghai Commercial Bank.

(2) Further, according to Mr Zha, the Plaintiff should have since 4 June 2025 held 248,592,000 shares (representing 11.15%) under a shares transfer from Wang Xuefei (“Wang”) and Wu Qiuxia (“Wu”) in favour of the Plaintiff (the “Shares Transfer”). However, the ListCo has recently disputed the validity of the Shares Transfer in favour of the Plaintiff, although a share certificate for the Plaintiff’s shareholding of the 248,592,000 shares had already been issued in the Plaintiff’s name on 4 June 2025, and in the Shareholders List of the ListCo as at 18 July 2025, the Plaintiff had already been registered as a shareholder of 248,592,000.

7.  The 2^nd to 6^th Defendants were directors of the ListCo at all the material times at least up until 12 August 2025. The 6^th Defendant was an independent non-executive director of the ListCo between December 2023 and June 2024, thereafter appointed as the Chairman of the ListCo.

8.  The other two directors were Ms Zha (whose duties as executive directors have since 29 July 2025 been suspended) and Mr Liu Minbin (“Mr Liu”) (who were also chairman of the Board but was removed as such on 2 August 2024 and whose duties as executive director have since 2 August 2024 been suspended).

III. BACKGROUND

9.  On 27 June 2025, “being a member of the [ListCo] holding 248,592,000 shares in the [ListCo]”, the Plaintiff submitted a requisition (the “Requisition”) to the then Board for an EGM (the “Requisitioned EGM”) to be held on 25 July 2025, proposing ordinary resolutions (the “Requisitioned Resolutions”) to, among others:-

“1. THAT Ms. Tang Po Yi [the 2^nd Defendant] be and is hereby removed as an executive director of the Company…

2. THAT Ms. Han Xingxing [the 3^rd Defendant] be and is hereby removed as an independent non-executive director of the Company…

3. THAT Mr. Li Yu [the 4^th Defendant] be and is hereby removed as an independent non-executive director of the Company…

4. THAT Mr. Lau Jing Yeung William [the 5^th Defendant] be and is hereby removed as an independent non-executive director of the Company…

5. THAT each and every director(s) of the Company (if any) appointed by the board of directors of the Company but without the approval of the general meeting of the Company during the period commencing on 27 June 2025 to convene an extraordinary general meeting of the Company and ending on the day of the holding of the extraordinary general meeting of the Company (or any adjournment thereof), both dates inclusive, be and are hereby removed as director(s) of the Company (if any)…

6. THAT any or more of the directors of the Company be and is/are hereby authorised to do all such acts and things and execute all such documents as he/she/they may consider necessary, desirable or expedient for the purpose of or in connection with, the implementation of and giving effect to the aforementioned resolutions and to attend to any necessary registration and/or filing for and on behalf of the Company.”

10.  The Requisition was issued pursuant to article 58 of the M&A:-

“The Board may whenever it thinks fit call extraordinary general meetings. Anyone or more Members holding at the date of deposit of the requisition not less than one-tenth of the voting right (on a one vote per share basis) in the capital of the Company shall at all times have the right, by written requisition to the Board or the Secretary of the Company, to require an extraordinary general meeting to be called by the Board for the transaction of any business or resolution specified in such requisition; and such meeting shall be held within two (2) months after the deposit of such requisition. If within twenty-one (21) days of such deposit the Board fails to proceed to convene such meeting the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of the Board shall be reimbursed to the requisitionist(s) by the Company.”

11.  As the Requisition was issued on 27 June 2025, the Board should “proceed to convene” the requisitioned EGM on or before 18 July 2025 (that is, the date of expiry of 21 days from 27 June 2025). Further, to call an EGM, not less than 14 clear days’ notice is required by article 59 of the M&A.

12.  On 2 July 2025, the Plaintiff, “holding 248,592,000 shares in the [ListCo]”, sent a letter in English and another letter in Chinese to the ListCo. Both letters demanded, among other things, (1) an immediate disclosure of the Requisition as required under the Securities and Futures Ordinance (Cap. 622) (the “SFO”); (2) convening the requisitioned EGM; and (3) the ListCo should confirm that it would comply with the demands within 48 hours. In the Chinese letter, the Plaintiff also pointed out that the 2^nd to 6^th Defendants should not vote at, should not be counted at and should not chair the requisitioned EGM. On 4 July 2025, the Plaintiff sent a chaser to the ListCo repeating the same demand.

13.  On 14 July 2025, HKEX wrote to the ListCo, stating that it had received several complaints about the ListCo in relation to the requisitioned EGM and posing a number of enquiries for the ListCo to answer.

14.  On 17 July 2025, the Board did not resolve to convene the Requisitioned EGM. Rather, it was to approve a draft announcement to the public in response to the Requisition:-

“本公司於2025年6月27日收到自一名股東 [the Plaintiff](持有本公司248,592,000股股份，佔本公司附股東大會表決權之繳足股本不少於十分之一)的書面要求(「要求」)。根據本公司組織章程細則第58條，要求提出董事會須召開股東特別大會，藉以建議考慮並酌情通過罷免四位董事之職務及其他2項議案共6項議案的普通決議案。

有關回應股東要求之公告草稿(「公告」)，已於較早時候送達各董事細閱，於會上獲提呈考慮。

主席在會上補充，本公司是按照公司章程於21天時間內刊登召開EGM的公告，預計EGM將於2025年8月27日舉行(即要求日期起計兩個月內)。”

15.  On 18 July 2025, that is, the date of the expiry of the 21 days for the ListCo to “proceed to convene” the requisitioned EGM, the ListCo issued an announcement as approved by the said board meeting:-

“The board of directors (the “Board”) of the [ListCo] announces that it received a written requisition (the “Requisition”) dated 27 June 2025 from a shareholder, [the Plaintiff], which holds 248,592,000 shares in the [ListCo], representing not less than one-tenth of the paid-up capital of the Company carrying the right of voting at general meetings.

[setting out the Requisitioned Resolutions]

The Board is proceeding to convene the EGM, which will be held on 27 August 2025 (i.e. within two months from the date of the Requisition), in accordance with the relevant provisions of the Articles for the shareholders to consider the proposed resolutions specified in the Requisition. The Company will despatch a circular… as soon as practicable. The Board is also in the course of seeking professional advice as to the Requisition and appropriate course of action.”

16.  Only the date was specified. No notice for calling the EGM was issued. Nor was it mentioned in the announcement that there had been a board resolution on 17 July 2025 to convene an EGM on 27 August 2025. What was stated in the announcement is that “the Board is proceeding to convene the EMG”.

17.  On 23 July 2025, the Plaintiff issued a Notice of EGM (the “Plaintiff’s Notice of EGM”) to convene an EGM to consider the Requisitioned Resolutions at 9am on 12 August 2025, and advertised the Plaintiff’s Notice of EGM in Sing Tao Daily and The Standard.

18.  On 24 July 2025, board resolutions were passed by 2^nd to 5^th Defendants, among others:-

(1) To appoint the 6^th Defendant as an executive director and Chairman of the Board; and

(2) To refuse the registration of the Shares Transfer in favour of the Plaintiff under article 50 of the M&A pending the investigation into the independence of the original placees of the shares under the Shares Transfer, that is, Wang and Wu.

19.  On the same day, that is, 24 July 2025, the ListCo issued a “Clarification Announcement”:-

“Reference is made to the announcement (the “Announcement”) of [the ListCo] dated 18 July 2025…

It has come to the Board’s attention that, on 23 July 2025, [the Plaintiff] (the “Requisitionist”) published a notice in Sing Tao Daily and The Standard purporting to convene an EGM on a date inconsistent with the Board’s properly convened EGM that was previously announced in the Announcement.

The Board would like to clarify that:

1. The Board has validly proceeded to convene the EGM on 17 July 2025 in strict compliance with Article 58 of the Articles of Association, with the meeting date set for 27 August 205, as noted in the Announcement.

2. The Requisitionist’s purported notice is invalid as:

(a) The Board had already discharged its duty under Article 58 by proceeding to convene the EGM within 21 days of the deposit of the Requisition (27 June 2025);

(b) No breach of Article 58 occurred – the resolution passed at the Board meeting on 17 July 2025 and the Announcement of 18 July 2025 constituted the Board’s obligation to ‘proceed to convene’ the EGM under Cayman Islands law and the Articles;

(c) The Requisitionist has no standing to unilaterally proceed to convene an EGM where the Board has complied with Article 58.

3. The EGM which the Board has validly proceeded to convene will be held as follows…

4. The Company will dispatch a circular containing, amongst other things, the relevant notice convening the EGM, resolutions and proxy form… to shareholders by 11 August 2025 (not less than 14 clear days, per Article 59).

Shareholders are advised to disregard any contradictory notices. Only resolutions proposed at the Board-convened EGM on 27 August 2025 will be validly considered. The Company is seeking legal advice to restrain the Requisitionist’s improper actions.”

20.  Also on 24 July 2025, the ListCo issued an announcement that the 6^th Defendant had been appointed as an executive director of the ListCo and Chairman of the Board effective from 24 July 2025 for an annual remuneration of HK$1,200,000. As the 6^th Defendant was not appointed by a general meeting, he was therefore also caught by the Requisitioned Resolutions.

21.  The next day, that is, 25 July 2025, the Plaintiff issued a “Clarification Announcement” of the ListCo reiterating the validity of the Requisition and the EGM to be held on 12 August 2025.

22.  On 28 July 2025, the Plaintiff issued a Clarification of the ListCo to the same effect.

23.  On 29 July 2025, the ListCo issued an announcement that on 29 July 2025, the Board had resolved to suspend the duties of Ms Zha as executive director of the ListCo with immediate effect pending an independent investigation into the allegations made in a complaint letter received from a shareholder against Ms Zha, Mr Zha and the Plaintiff. It apparently had in mind the anonymous complaint letter dated 22 July 2025 mentioned above. The announcement summarised the allegations in the complaint letter in the following terms:-

“The Allegations are in connection with (i) the placing of 218,512,000 new shares by the Company (the “Placing”) which was completed on 19 July 2024 and the subscription of a total of 80,500,000 shares by four named individual placees through the Placing and (ii) the 1 for 2 rights issue conducted by the Company on 23 August 2024 (the “Rights Issue”) and the subscription of a total of 248,000,000 shares by two named individual subscribers through the Rights Issue. The Allegations alleged that the said placees of the Placing and the said subscribers of the Rights Issue were not independent third parties.”

24.  On 30 July 2025, the Plaintiff issued yet another Clarification Announcement, and on 31 July 2025, a similar Clarification of the ListCo.

25.  On 1 August 2025, the ListCo issued an announcement reiterating that the EGM would be held on 28 August 2025 at 11am and informed shareholders to disregard any contradictory documents. However, it still stopped short of issuing any notice of meeting.

26.  On 6 August 2025, the ListCo issued Notice of EGM (the “Defendants’ Notice of EGM”) for an EGM to be held on 27 August 2025 on the Requisitioned Resolutions.

27.  On 11 August 2025, the trading of the shares in the ListCo on the HKEX was (and has since then been) suspended.

28.  On 12 August 2025, EGM (the “12 August EGM”) was arranged by and held at the office premises of ANPA Financial Press Limited (“ANPA”) pursuant to the Plaintiff’s Notice of EGM. The Plaintiff’s EGM was chaired by Mr Liu, and the Requisitioned Resolutions were all passed to remove the 2^nd to 6^th Defendants as directors (the “Removal Resolutions”). Upon the removal of the 2^nd to 6^th Defendants (if valid), the remaining directors were Ms Zha and Mr Liu only. On the same day, they passed a written board resolution to terminate the appointment of the then company secretary and appoint a new company secretary.

29.  On the same day, that is, 12 August 2025, the 6^th Defendant, in the name of the ListCo, issued a public announcement in relation to the Plaintiff’s EGM and reminding the shareholders of the EGM to be held on 27 August 2025. It stated that:-

“Upon arrival [at the office premises of ANPA], Mr. Lu [the 6^th Defendant] and Ms. Tang [the 2^nd Defendant] immediately identified themselves to the staff of ANPA and stated their respective roles as the Chairman and executive director of the Company. Mr Lu made clear to the staff of ANPA and all other persons present at the scene that he was present to chair the Purported EGM pursuant to Article 63 of the Company’s articles of association (the “Articles”). Despite this, both Mr. Lu and Ms. Tang were denied access to the meeting room by the staff of ANPA as the staff of ANPA refused their entry to the meeting room and required them to join a queue allegedly for registration with all other attendees.

…

Due to the above, Mr. Lu and Ms. Tang were denied access to the meeting room of the Purported EGM at 9:00 a.m. and they eventually only managed to enter the meeting room of the Purported EGM at around 9:30 a.m. Thereafter, Mr. Lu, being the Chairman of the Company, presided as Chairman at the meeting in accordance with Article 63 of the Articles…

… The Chairman considered it to be in the best interests of the Company and its shareholders as a whole to exercise his power as the Chairman and adjourned the Purported EGM. As the Purported EGM was adjourned by the Chairman, no resolutions were proposed and no voting took place at the Purported EGM…

[Reminder of the EGM to be held on 27 August 2025]

… if [the Requisitioned Resolutions] are duly passed, only Mr. Liu Minbin and Ms. Zha Mengling will remain as directors of the Company but their directors’ duties were suspended… and the Company will fail to meet the requirements set out in Rules 3.10, 3.10A, 3.21, 3.25 and 3.27A of the Listing Rules in respect of the required number of independent non-executive directors and the composition of audit committee, remuneration committee and nomination committee of the Company. Shareholders are therefore advised to consider carefully as to whether to vote for or against the [Requisitioned Resolutions]… ”

30.  Mr Zha said that any delay in the 2^nd and 6^th Defendants’ entry was not caused by the Plaintiff. Mr Zha further said that all the attendants of the Plaintiff’s EGM had to go through the same security check conducted by ANPA staff before entering the venue for registration by Infinity CPA Limited (“Infinity CPA”), appointed as the scrutineer for the Plaintiff’s EGM.

31.  On 27 August 2025, EGM (the “27 August EGM”) was held pursuant to the ListCo’s Notice of EGM. At the 27 August EGM, no substantive decision was made, and it was adjourned. According to the public announcement issued by the 6^th Defendant in the name of ListCo of even date:-

“At the EGM, [the 6^th Defendant], the chairman of the Company and hence the chairman of the EGM according to Article 63 of the articles of association of the Company (the “Articles”) proposed in good faith to adjourn the EGM (the “Adjournment Proposal”) due to

(i) the Company has submitted a letter to the Stock Exchange and Securities and Futures Commission on 8 August 2025 to seek their assistance in investigating the matters in relation to the Placings and connections among Mr. Zha, Ms. Zha and Mr. Liu as disclosed in the announcement of the Company dated 26 August 2025;

(ii) the Company has filed a writ of summons with the High Court of Hong Kong to claim against Mr. Zha, Ms. Wang, Ms. Wu, the 19 July 2024 Placees, [the Plaintiff] and Mr. Liu, among others, that (a) the Placings are void or voidable and the Company is entitled to rescind the Placings and cancel/reverse the allotment of the 19 July Wrongfully Allotted Shares and the 30 Sept Wrongfully Allotted Shares; (b) the Alleged Independent Placees are not entitled to exercise any powers (including voting powers) attached to the 19 July Wrongfully Allotted Shares and the 30 Sept Wrongfully Allotted Shares; and (c) [the Plaintiff] is not entitled to invoke the 30 Sept Wrongfully Allotted Shares to requisition for the Requisition[ed] EGM as disclosed in the announcement of the Company dated 27 August 2025; and

(iii) on 27 August 2025 and prior to the EGM, the Company has received an email from a shareholder of the Company indicating that the shareholder as petitioner intends to file an unfair prejudice petition (a draft of which was attached to the said email) with the High Court of Hong Kong against the Company, [the Plaintiff], Mr. Liu, Ms. Wang, Ms. Wu and the 19 July 2024 Placees and ask for, among others, (a) a declaration and an order that the placings and allotments of the relevant shares of the Company (the “Shares”) to Ms. Wang, Ms. Wu and the 19 July 2024 Placees are null and void or have been rescinded and be set aside; (b) the transfer of an aggregate of 248,592,000 Shares from Ms. Wang and Ms. Wu to [the Plaintiff] and 19 July 2024 Placees that they be restrained from exercising any rights (including voting rights) attached to the 19 July Wrongfully Allotted Shares and the 30 Sept Wrongfully Allotted Shares ((ii) and (iii) above collectively the “Court Actions”).

The Adjournment Proposal, which related purely to a procedural or administrative matter and is not on the agenda of the EGM under the Circular and the Notice, was voted in favour by the Shareholders who were present at the EGM by a show of hands…

As more than 50% of the votes were cast in favour of the Adjournment Proposal, [the 6^th Defendant], with the consent of the EGM and in accordance with Article 64 of the Articles, declared the EGM to be adjourned to a later date to be determined after the conclusion of the Court Actions.”

32.  On 11 September 2025, one Chen Lili presented a winding up petition, to be heard on 19 November 2025.

IV. THE PLAINTIFF’S CASE

33.  Against the above background, the Plaintiff’s case is, broadly speaking for the present purpose, that:-

(1) On 18 July 2025, the Board, under the control of the 2^nd to 5^th Defendants, failed to “proceed to convene” the Requisitioned EGM under article 54. Therefore, on 23 July 2025, the Plaintiff was entitled to convene the 12 August EGM on its own under article 54 and so validly issued the Plaintiff’s Notice of EGM to convene the 12 August EGM on 12 August 2025.

(2) On 12 August 2025, the Plaintiff’s EGM was validly held, and at the Plaintiff’s EMG, the Requisitioned Resolutions were passed validly to remove the 2^nd to 6^th Defendants.

(3) The 27 August EGM held on 27 August 2025 was invalid given that the 2^nd to 6^th Defendants had been validly removed as directors.

(4) In any event, the adjournment of the 27 August EGM (the “Adjournment”) was invalid in breach of article 64.

V. THE 2^ND TO 6^TH DEFENDANTS’ CASE

34.  The 2^nd to 6^th Defendants’ defence was, broadly speaking for the present purpose, that:-

(1) On 17 July 2025, the Board convened a board meeting to convene an EGM on 27 August 2025 and on 18 July 2025, the ListCo issued a public announcement that the ListCo would hold an EGM on 27 August 2025 as requisitioned. Therefore, the ListCo had “proceeded to convene” an EGM under article 54. Since the ListCo had proceeded to convene the EGM as requisitioned, the Plaintiff was not entitled to convene an EGM by its own, and therefore, the Plaintiff’s Notice of EGM issued on 23 July 2025, and the Plaintiff’s EGM held on 12 August 2025, were all invalid. It follows that the Removal Resolutions passed at the Plaintiff’s EGM were also invalid.

(2) In any event, the Adjournment was validly made.

VI. ISSUES

35.  The issues were:-

(1) Whether the ListCo had proceeded to convene an EGM as requisitioned by the board meeting of 17 July 2025 to convene an EGM as requisitioned and the ListCo issuing a public announcement on 18 July 2025 that an EGM would be held on 27 August 2025; and

(2) Whether the Adjournment was valid.

VII. WHETHER THE LISTCO HAD PROCEEDED TO CONVENE AN EGM AS REQUISITIONED BY THE BOARD MEETING OF 17 JULY 2025 TO CONVENE AN EGM AS REQUISITIONED AND THE LISTCO ISSUING A PUBLIC ANNOUNCEMENT ON 18 JULY 2025 THAT AN EGM WOULD BE HELD ON 27 AUGUST 2025

36.  The first question to ask was whether the ListCo had proceeded to convene an EGM as requisitioned by the board meeting of 17 July 2025 to convene an EGM as requisitioned and the ListCo issuing a public announcement on 18 July 2025 that an EGM would be held on 27 August 2025. If so, it would follow that the 12 August EGM was validly held. It was a question of interpretation of article 58 of the Articles of Association, which was governed by Cayman Islands law.

37.  It is convenient to set out article 58 here:-

“The Board may whenever it thinks fit call extraordinary general meetings. Anyone or more Members holding at the date of deposit of the requisition not less than one-tenth of the voting right (on a one vote per share basis) in the capital of the Company shall at all times have the right, by written requisition to the Board or the Secretary of the Company, to require an extraordinary general meeting to be called by the Board for the transaction of any business or resolution specified in such requisition; and such meeting shall be held within two (2) months after the deposit of such requisition. If within twenty-one (21) days of such deposit the Board fails to proceed to convene such meeting the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of the Board shall be reimbursed to the requisitionist(s) by the Company.”

38.  The specific question was what is the meaning of “proceed to convene”.

39.  As agreed by Mr William Wong SC (leading Mr Charlie Liu and Ms Valerie Kwok), counsel for the Plaintiff and Mr Christopher Chain SC (leading Mr Alex Yeung), counsel for the 2^nd to 6^th Defendants, the legal principles in relation to interpretation of articles of association under the Cayman Islands law are essentially the same as Hong Kong law. I quote here §16 of the Cayman Islands legal opinion of Mr Thomas Lowe KC dated 23 October 2025 filed on behalf of the Plaintiff in this regard, to which Mr Chain also referred:-

“The interpretative principle to be applied in construing the articles of a Cayman company were summarised by Parker J in In re Global-IP Cayman Bronzelink Holdings Limited [2021 (1) CILR 228] at [43] as follows:

Principles to be applied in construing the articles

43 The principles of contractual interpretation as applied to a company’s constitutional documents are well-known.

(i) The court will identify the objective meaning of the contract by reference to what a reasonable person, having the background knowledge which would have been available to the parties, would have understood the parties to have intended by the language they used. The court will use an iterative process that requires checking each suggested interpretation against the provisions of the contract and its commercial consequences.

(ii) The meaning of the language used must be assessed in the light of the natural and ordinary meaning of the clause, any other relevant provisions of the contract, the overall purpose of the clause in the contract, the facts and circumstances known or assumed by the parties at the time the contract was made, and commercial common sense, but disregarding the parties’ subjective intention.

(iii) However, when construing articles of association the surrounding circumstances will have very limited application. The focus is predominantly on the text itself. There must be close attention paid to the particular words.

(iv) Where there are competing interpretations, the court may adopt the interpretation that is more consistent with business common sense. In doing so, the court must consider the quality of the drafting and the possibility that one side may have agreed to do something which, with hindsight, did not serve its interest. Similarly the court must keep in mind the possibility that a provision was a negotiated compromise or that the parties could not agree more precise terms. Corporate constitutional documents must be construed in a way that gives then commercial efficacy.

(v) As Jenkins, L.J. observed, the articles of association of a company (Holmes v Keyes (5) ([1958] 2 All E.R. 138)):

‘… should be regarded as a business document and should be construed so as to give them reasonable business efficacy, where a construction tending to that result is admissible on the language of the articles, in preference to a result which would or might prove unworkable.’”

40.  Staring with the objective meaning by reference to what a reasonable person having the background knowledge would have understood in article 58 itself and by reference to the natural and ordinary meaning, “convene” means “cause to come together”: see Shackleton on the Law and Practice of Meetings (16^th ed) §5-01.

41.  In the iterative process of checking the interpretation of “convene”, I should also refer to other provisions of the Articles of Association. In this regard, I note that “convene” appears only once in article 58. The whole article 58 is otherwise concerning “calling” an EGM:-

(1) “The Board may whenever it thinks fit call extraordinary general meetings.”

(2) “Any one or more Members holding at the date of deposit of the requisition not less than one-tenth of the voting right… shall at all times have the right, by written requisition to the Board or the Secretary of the Company, to require an extraordinary general meeting to be called by the Board…”

42.  As to what is meant by “calling” a meeting, article 59(1), in my view, makes it clear that “calling a meeting” means issuing a notice of meeting. It provides that:-

“An annual general meeting and any extraordinary general meeting at which the passing of a special resolution is to be considered shall be called by not less than twenty-one (21) clear days’ Notice. All other extraordinary general meetings may be called by not less than fourteen (14) clear days’ Notice but a general meeting may be called by shorter notice…”

43.  It is also convenient here to set out article 59(2) about what should be specified in the notice:-

“The notice shall specify (a) the time and date of the meeting, (b) save for an electronic meeting, the place of the meeting and if there is more than one meeting location as determined by the Board pursuant to Article 65A, the principal place of the meeting, (c) if the general meeting is to be held by means of a hybrid meeting or an electronic meeting, the notice shall include a statement with details of the electronic and/or communication facilities for attendance and participation by electronic means at the meeting, and (d) the particulars of the resolutions to be considers at the meeting…”

44.  Back to the word “convene”. I note that in articles 86(5), 122 and 155(2), the phrase “convened and held” is used to refer to a general meeting. Therefore, objectively viewed, “convene” and “hold” are not intended to carry the same meaning.

45.  From the natural and ordinary meaning as well as reading it against other provisions, “convene” means more in article 58 than “calling” and “holding”; otherwise, the draftsman would simply have chosen the word “call” or “hold” instead of “convene” in article 58. By the Articles of Association, “calling” or issuing a notice of, a general meeting, is part of convening a general meeting. While the parties agree that “convene” here could itself mean “calling”, in my view, more accurately, “calling” should be understood as the very first point of the process of convening a meeting. After the process of convening a meeting is started by issuing a notice of meeting, the Company would then have to arrange for the logistics for the meeting so as to “cause [the members] to come together”, and eventually there would be the “holding” of the meeting.

46.  So much for the word “convene”. I shall turn to “proceed to”. The natural and ordinary meaning is “go or travel forward”, “pass on from one point to another in a series”, “make some progress”: see Shorter Oxford English Dictionary, or “moving forward”: see Cambridge Dictionary.

47.  The subject to “proceed to convene” is the “Board”. What the “Board” may do in order to “proceed to convene” includes convening a board meeting to consider and pass a resolution to issue a notice of the meeting, and of course also passing such a resolution itself. Reading this in the context of article 58, it must be borne in mind that the purpose of this article is that the requisitionist may himself decide whether to convene the requisitioned meeting, and in order to decide whether he should convene the meeting himself, he should be able to know whether there has been any step taken towards “calling” the meeting, the very first point of the process of convening. Further, bearing in mind the timeframe of 21 days prescribed for the requisitionist to determine if he has to convene the meeting himself, the step regarded as “proceeding to convene” should not be too far away from “convene”. In my view, mere convening a board meeting to consider and pass a resolution to issue a notice, while obviously a step towards convening a meeting, is not sufficient for this purpose, because (1) the board may or may not pass such a resolution, and (2) it is too far away so that the 21 days’ timeframe for the requisitionist may be rendered redundant.

48.  On the contrary, in my view, a board meeting passing a resolution to issue a notice of meeting is sufficient because once there is such a resolution, the administrative organ (primarily the company secretary) would then have to execute the resolution through all the way to the holding of the meeting. Indeed, in my view, a board should normally take this step as “proceeding to convene” the requisitioned meeting.

49.  In-between may be:-

(1) A board meeting approving an announcement to the members that it will call and hold such a meeting without specifying any date, time and venue and the mode of meeting;

(2) A board meeting approving an announcement to the members that it will call and hold such a meeting specifying only date, or time, or venue, or any two of them only; and

(3) A board meeting approving an announcement to the members that it will call and hold such a meeting specifying the date, time, and venue (or if the meeting is to be held by some other mode, the mode and the relevant information as specified in article 59(2)(c) and (d)).

50.  I pause to make an observation that in appropriate circumstances, explanation may be called for as to why the board, meeting at a board meeting anyway, would rather approve a draft announcement to say that it would hold a meeting on a certain date, than simply pass a board resolution to convene the meeting and then tell the members in concrete terms that a board resolution to convene the meeting has been passed. Here may not be an occasion, however, for me to say whether the Board here could be regarded as acting properly and/or in good faith in doing so.

51.  Mr Wong submitted that none of the three scenarios in-between above is sufficient, because only notice of meeting could signify an action taken by the Board and the Company and only by this action could the requisitionist know whether to convene the meeting himself. Mr Wong further submitted that I should read “proceed to” as otiose. I agree that where circumstances are appropriate, some words may be read as otiose, but I should try not to. In my view, a board’s manifestation of its intention to the members to call a meeting, or in other words, its intention to issue a notice of the meeting should be sufficient as “proceeding to convene” for the following reasons:-

(1) After all the previous steps have been taken, to convene a meeting is, as the first step, to call, or give notice of, the meeting. This is in my view consistent with parties’ agreement that “convene” means “giving formal notice of the meeting” and also consistent with the fact that giving notice is the first substantial step taken by the Board to start the process of convening the meeting.

(2) To “proceed to” “convene” a meeting, thus viewed, means, to proceed to issue a notice of meeting.

(3) When the board has manifested its intention to the members that it would give notice of the meeting, absent any credible suggestion that the board is not going to honour such intention, the board has in my view moving forward, or proceeding, to issuing the notice.

(4) Such manifestation would therefore be sufficient for the requisitionist to know whether he himself has to convene the meeting.

(5) As such, the requisitionist would still be afforded the protection mechanism intended under article 58. Therefore, it is not necessary to read “proceed to” as otiose.

52.  What amounts to a manifestation of intention to issue a notice of meeting under article 58? Pursuant to article 59(2), a notice should specify the date, time, venue and if appropriate the mode of the meeting and the relevant information for the mode of the meeting. To say that the board has the intention to issue a notice, it must of course at least inform the members of the necessary information that would be in the notice to be issued. In fact, such information is necessary to “cause [the members] to come together”. Short of the date, or the time, or the venue, one cannot “cause [them] to come together”.

53.  Mr Chain submitted that specifying the date only, as in announcement made on 18 July 2025 (see §15 above) in the present case, would be sufficient because once the board has manifested its intention to hold a meeting on a specified date and if 14 days before the specified date, the company has still not issued any notice, then the requisitionist may come to Court, probably on an urgent basis, to seek remedy. With respect, I disagree for the following reasons:-

(1) First, such submissions do not sit well with the natural and ordinary meaning of the word “convene”, which as the parties agree, means “calling” and thus “giving a notice of the meeting” (or more accurately, the first step of “convening” being “calling”). Therefore, “proceeding to convene” could be read as “proceeding to give a notice of the meeting”, and the notice of the meeting, as specified above, should contain the date, and time and the venue and the mode of the meeting (if appropriate).

(2) Second, although specifying the date only can be regarded as a step moving forwards to issuing the notice, as mentioned above, there is also the timeframe element I should take into account in interpreting article 58. The step taken as “proceed to” under article 58 should therefore not be too far away. Specifying the date only would not be sufficient for issuing the notice. So, there would be at least one more step towards issuing the notice, but there would be no time limit for the board as to when it should specify the time and then the venue. This could be subject to abuse by the board (and for the avoidance of doubt, I am not saying that the Board in the present case did that, since this was not an issue before me). Such reading could not have been objectively agreed by the parties to the Articles of Association.

(3) Relatedly, I should also say that even the manifestation of intention to issue a notice may be subject to similar abuse, although obviously it is more difficult for the company not to issue any notice after the board manifests its intention to the members to do so.

(4) It is therefore more probable than not, and so it is my finding, that it was agreed under the Articles of Association that “proceed to convene”, read as “proceed to issue a notice of meeting”, cannot be taken farther back than the manifestation of the intention to issue a notice, with the date, time and venue and the mode (if appropriate) specified. Anything before such manifestation of the intention is in my view not within the meaning of “proceed to convene” under article 58.

(5) So, in my view, “proceed to convene” means any steps starting from manifestation of the board’s intention to hold a meeting on a specified date, time and venue and the mode of meeting (if appropriate). Such manifestation would effectively, though not formally, be a board resolution to issue the notice of meeting.

(6) Passing such a board resolution or effectively doing so by manifesting such an intention, as far as I can see, is the one step before “convening” the meeting, and taking into account the timeframe prescribed under article 58, it is the step falling within the meaning of “proceed to convene”. Any step further backward is, in my view, not something agreed under the Articles of Association.

54.  Insofar as it is suggested that there are competing interpretations because despite the timeframe element, “proceed to convene” in article 58 could mean a step further backward, for example, manifestation of intention to hold a meeting specifying the date only but not the time and venue, I also hold that my interpretation above is more consistent with commercial common sense and gives reasonable business efficacy, and thus despite any competing interpretations, it is also my finding that my interpretation above was what was agreed under the Articles of Association.

55.  In the present case, given that board resolution of 17 July 2025 and the announcement of 18 July 2025 did not specify the time and venue, while it can be regarded as “proceeding to convene” in loose sense, it was not so under article 58. It follows that the 12 August 2025 EGM was validly held.

56.  Therefore, in my view, and Mr Chain very fairly accepted that if I was not with him on this interpretation point on “proceed to convene”, the Plaintiff would be entitled to relief 1 – 4 of the Amended Originating Summons, and so I ordered.

57.  This dealt with the matter. As I foreshadowed in my oral reason for judgment, I might deal with some other points if I would think fit. Given that the parties spent some time on the second issue, namely, whether the Adjournment was valid, I would say a few words about this. This is related to alternative relief 4A of the Amended Originating Summons.

VIII. WHETHER THE ADJOURNMENT WAS VALID

58.  The Adjournment was purportedly exercised pursuant to article 64, which provided that:-

“The chairman may, with the consent of any meeting at which a quorum is present (and shall if so directed by the meeting), adjourn the meeting from time to time and/or from place to place and/or from one form to another… When a meeting is adjourned for fourteen (14) days or more, at least seven (7) clear days’ notice of the adjourned meeting shall be given…”

59.  In other words, when an adjournment is made, the time and/or the place and/or the form have to be specified for the adjourned meeting. Mr Chain, rightly in my view, did not dispute this. The purpose of this requirement is obvious – an adjournment without stating when and how the adjourned meeting would be held can sometimes mean practically the cancellation of the meeting. Even though the adjournment is said to hinge upon occurrence of an event the time of which is unknown at the time of the adjournment, in my view, an adjournment of the meeting to a specified time and place is still necessary – at the adjourned meeting, if the event has still yet to happen, the members would be updated and consider in the updated circumstances whether the resolution should be passed, voted down or further adjourned. Adjourning the meeting without specifying the time would deprive the members of a chance to consider and vote on the relevant resolution in the light of the development (or non-development) of the matter. Therefore, in my view, the adjournment purportedly made pursuant to article 64 was not properly exercised, or put other way, there was no valid exercise of the power to adjourn under article 64.

60.  Mr Chain submitted that the members in attendance have a common law power to adjourn under the Cayman Islands law: see John Kennedy Carruth v Imperial Chemical Industries Limited [1937] AC 707 at 761 per Lord Russell. This position is, as I understand, the same as under the Hong Kong law. However, the Adjournment was proposed by the 6^th Defendant as the Chairman of the 27 August EGM to the members, and made upon the members’ consent expressly pursuant to article 64 of the Articles of Association. No mention was made that the Adjournment was made pursuant to some other powers. Therefore, I am unable to accept Mr Chain’s submissions that the Adjournment was valid as an exercise of the common law power.

61.  Mr Chain also submitted that even under article 64, it was the members’ directions to adjourn, and the 6^th Defendant as the Chairman would have no choice but to comply with such directions under article 64, therefore not in breach of any duty. He relied on the phrase in parenthesis “(and shall if so directed by the meeting)” in article 64. However, , according to the announcement made on 27 August 2025 (see §31 above),, it was the 6^th Defendant who proposed the adjournment; it was not that some members proposed directing the chairman to adjourn, put the members’ proposal for vote, and resolved to give such directions to the chairman. Therefore, the Adjournment fell within “[t]he chairman may, with the consent of any meeting at which a quorum is present (and shall if so directed by the meeting), adjourn”. In any event, at least in the present case, even assuming that it was the members’ direction to the chairman to adjourn, there was still no date, time, and place to which the meeting would be adjourned as required under article 64.

62.  In the premises, in the present case, the 6^th Defendant adjourned the 27 August EGM ultra vires in breach of the Articles of Association because the adjournment was not an adjournment from time to time, place to place and/or from one form to another, but simply an adjournment until an unspecified dated.

63.  The analysis above would be material in that the 6^th Defendant’s breach would be a perquisite for the Plaintiffs’ reliance on sections 728-730 of the Companies Ordinance (Cap. 622) in seeking the alternative relief 4A. It is convenient to quote sections 728-730 here:-

“728. Application of section 729

(1) Section 729 applies if, in relation to a company –

(a) a person has engaged, is engaging or is proposing to engage in conduct that constituted, constitutes or would constitute –

(i) a contravention of this Ordinance;

(ii) a default relating to a contravention of this Ordinance; or

(iii) a breach specified in subsection (4); or

(b) a person has refused or failed, is refusing or failing, or is proposing to refuse or fail, to do an act or thing that the person is required by this Ordinance to do….

729. Court may order remedies

(1) The Court may, on application by a member or creditor of the company whose interests have been, are or would be affected by the conduct or by the refusal or failure, do any or all of the following –

(a) grant an injunction, on the terms that the Court thinks fit –

(i) in the case of section 728(1)(a) or (2), restraining the person from engaging in the conduct or requiring the person to do any act or thing; or

(ii) in the case of section 728(1)(b) or (3), requiring the person to do any act or thing;

…

(3) The Court may grant an injunction under subsection (1)(a)(i) or (2)(a)(i) restraining a person from engaging in a conduct-

(a) whether or not it appears to the Court that the person intends to engage again, or to continue to engage, in the conduct;

(b) whether or not the person has previously engaged in the conduct; and

(c) whether or not there is an imminent danger of substantial damage to any other person if the person engages in the conduct.

(4) The Court may grant an injunction under subsection (1)(a) or (2)(a) requiring a person to do an act or thing –

(a) whether or not it appears to the Court that the person intends to refuse or fail again, or to continue to refuse or fail, to do the act or thing;

(b) whether or not the person has previously refused or failed to do the act or thing; and

(c) whether or not there is an imminent danger of substantial damage to any other person if the person refuses or fails to do the act or thing.” (emphasis added)”

64.  The Adjournment, in my view, thus constituted a continuing breach. The powers conferred by section 729 to address breaches falling within section 728 are “widest possible”: see Sanju Environmental Protection (Hong Kong) Limited v Wang Lishan [2023] 2 HKLRD 242 at §§43-45 per Record Jin Pao SC. In my view, to stop this breach, the Court would have the power under section 729(1) to restrain this further breach, or in mirror, to require the resumption of the 27 August EGM. Since I granted relief 1 – 4, it is not necessary to consider how the resumed meeting should be conducted.

IX. OTHERS

65.  In the evidence, the parties had accusations against each other. There is evidence suggesting that the 2^nd to 6^th Defendants were acting in bad faith, and there is also evidence suggesting that the Plaintiff had been concerting with other people who were placed with shares purportedly independently but actually in association with the Plaintiff. In the light of my judgment on the validity of the 12 August EGM, it is not necessary for me to express any view on such serious allegations.

X. COSTS

66.  For the benefit of the 1^st Defendant who, appropriately, did not attend the substantive hearing, but attended the first hearing on 19 September 2025, I set out here the following directions given at the end of the hearing on submissions on costs with a timeframe to start upon handing down of my judgment for paper disposal of costs:-

(1) The Plaintiff shall file and serve written submissions on costs within 14 days from the date of handing down of the judgment;

(2) The 1^st Defendant and the 2^nd to 6^th Defendants shall file and serve written submissions on costs within 14 days thereafter; and

(3) The Plaintiff shall file and serve written submissions on costs (if any) within 7 days thereafter.

67.  Lastly, it remains for me to thank Mr Wong, Mr Liu and Ms Kwok (counsel for the Plaintiff) and Mr Chain and Mr Yeung (counsel for the 2^nd to 6^th Defendants) for their able assistance.