THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional advisor.

If you have sold or transferred all your shares in Sirnaomics Ltd., you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

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Advancing RNAi Therapeutics

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

(1) PROPOSED GRANT OF SHARE OPTIONS TO A DIRECTOR; (2) CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS; AND (3) NOTICE OF EXTRAORDINARY GENERAL MEETING

Financial Advisor to the Company

Independent Financial Advisor to the Independent Board Committee and the Independent Shareholders

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Unless the context otherwise requires, capitalized terms used in this cover page shall have the same meanings as those defined in the section headed “Definitions” in this circular.

A notice convening the EGM of Sirnaomics Ltd. to be held at 10:00 a.m. on Friday, February 3, 2023 at 16/F, Tower 5, The Gateway, Harbour City, 15 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong is set out on pages 56 to 58 of this circular.

Whether or not you intend to attend the EGM, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time of the meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the meeting or any adjournment thereof should you so wish. The Company strongly recommends you to monitor the development of the COVID-19 situation and to assess, based on the social distancing policies, the necessity for attending the EGM in person.

PRECAUTIONARY MEASURES FOR THE EGM

To safeguard the health and safety of the Shareholders, the Company will implement the following precautionary measures at the EGM to prevent the spreading of COVID-19: (1) compulsory body temperature checks and health declaration for all attendees, including Directors and Shareholders at the entrance of the EGM venue. Any person with a body temperature of over 37.4 degrees Celsius and/or exhibiting flu-like symptoms will be denied entry into the EGM venue and be requested to leave the EGM venue; (2) every attendee will be required to wear a surgical facial mask throughout the EGM and maintain a safe distance between seats. Please note that no masks will be provided at the EGM venue and attendees should wear their own masks; and (3) the Company will not provide refreshments and will not distribute corporate gifts. In light of the continuing risks posed by COVID-19, the Company encourages the Shareholders to consider appointing the chairman of the EGM as their proxy to vote on the relevant resolutions at the EGM as an alternative to attending the EGM in person.

January 18, 2023

	Page
PRECAUTIONARY MEASURES AND ONLINE PARTICIPATION
FOR THE EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	ii
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . . . . .	25
LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR. . . . . . . . . . . . . . . . .	27
APPENDIX — GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	49
NOTICE OF EXTRAORDINARY GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . .	56

– i –

PRECAUTIONARY MEASURES AND ONLINE PARTICIPATION FOR THE EGM

Attendees are requested to observe and practise good personal hygiene at the times at the EGM venue. To the extent permitted under law, the Company reserves the right to deny entry into the EGM venue or require any person to leave the EGM venue so as to ensure the health and safety of the attendees at the EGM.

Subject to the development of COVID-19, the Company may implement further changes and precautionary measures and may issue further announcement on such measures as appropriate. Shareholders should check the Company’s website at www.sirnaomics.com for future announcements and updates on the EGM arrangements.

Appointment of proxy by non-registered Shareholders: non-registered Shareholders whose Shares are held through banks, brokers, custodians or the Hong Kong Securities Clearing Company Limited should consult directly with their banks or brokers or custodians (as the case may be) to assist them in the appointment of proxy.

Online participation

In addition to the physical meeting, to facilitate participation in the EGM by the Shareholders who cannot attend the EGM in person, Shareholders or their duly appointed proxies or corporate representatives may view and listen to the EGM through a live webcast of the EGM which can be accessed via (https://zoom.us/j/3017401730?pwd=clNzVWNqQVhDcUlvWGdtVHFtL3M2Zz09) on a smartphone, computer, tablet device or other browser enabled device, and submit questions in near real-time through functions to be offered by such online platform. Please follow the instructions on the landing page on how to access the webcast. The online platform will be opened for registered Shareholders and non-registered Shareholders to access approximately 30 minutes prior to the commencement of the EGM. Shareholders will be able to access the live webcast at the beginning of the EGM until its conclusion.

However, if a Shareholder participates in the EGM online only (i.e. neither the Shareholder nor its proxy attends the EGM physically and votes), the Shareholder will not be counted as quorum and his/her/its vote will not be counted. Where the Shareholder will not be attending the EGM in person but wishes to vote, please refer to the vote by proxy arrangement referred to above.

– ii –

PRECAUTIONARY MEASURES AND ONLINE PARTICIPATION FOR THE EGM

If Shareholders have any questions relating to the EGM, please contact the Company’s branch share registrar in Hong Kong as follows:

Computershare Hong Kong Investor Services Limited

17M Floor, Hopewell Centre 183 Queen’s Road East Wanchai, Hong Kong Telephone: +852 2862 8555 Facsimile: +852 2865 0990 Website: www.computershare.com/hk/contact

– iii –

DEFINITIONS

In this circular, the following expressions shall have the meaning set out below unless the context requires otherwise:

“Articles of Association” the articles of association of the Company, as amended, supplemented and restated from time to time
“associate(s)” has the meaning as defined in the Listing Rules from time to time
“Award(s)” an award of RSUs granted to a RSU Grantee pursuant to the RSU Scheme, an award may include, if so specified by the Board in its absolute discretion, cash and non-cash income, dividends or distributions and/or the sale proceeds of non-cash and non-scrip distributions in respect of those Shares from the Grant Date to the date that it vests
“Board” the board of Directors from time to time or a duly authorized committee thereof
“Business Day(s)”
a day on which banks in Hong Kong are generally open for business and the Stock Exchange is open for business of dealing securities
“Chief Executives” (i) the Chairman of the Board, and (ii) the Chief Executive Officer of the Company, or, for the purpose of the Share Option Scheme and the RSU Scheme only, any person as designated by him/her from time to time. For the avoidance of doubt, any decision prescribed to be made by the Chief Executives under the Share Option Scheme or the RSU Scheme (as the case may be) shall be made jointly by both persons of (i) and (ii) above
“Company”
Sirnaomics Ltd. (stock code: 2257), an exempted company incorporated in the Cayman Islands with limited liability

“connected person(s)” has the meaning as defined in the Listing Rules from time to time

– 1 –

DEFINITIONS

“Connected RSU Grantee(s)” the RSU Grantee(s) who are connected person(s) of the Company, namely Dr. Lu, Dr. Dai, Dr. Molyneaux, Dr. Evans and Dr. Yang
“Director(s)” the director(s) of the Company from time to time “Dr. Dai” Dr. Xiaochang Dai, an executive Director as at the Latest Practicable Date
“Dr. Evans” Dr. David Mark Evans, the Chief Scientific Officer of the Company and an executive Director as at the Latest Practicable Date
“Dr. Lu” Dr. Yang Lu ( alias Patrick Lu), the Chairman of the Board, the Chief Executive Officer of the Company, an executive Director and a substantial shareholder of the Company as at the Latest Practicable Date
“Dr. Molyneaux” Dr. Michael V. Molyneaux, the Chief Medical Officer of the Company and an executive Director as at the Latest Practicable Date
“Dr. Yang” Dr. Xianbin Yang, the General Manager of Sirnaomics Biopharmaceuticals (Suzhou) Co., Ltd., a subsidiary of the Company as at the Latest Practicable Date
“EGM” the extraordinary general meeting of the Company to be convened and held in due course to consider and, if thought fit, approve the proposed grant of Share Options to Dr. Lu and the proposed grant of RSUs to the Connected RSU Grantees

“Eligible Participant(s)” the eligible participants as defined under the Share Option Scheme and the RSU Scheme

“Grant Date”

November 24, 2022

“Grantee(s)”

the Share Option Grantee(s) and/or the RSU Grantee(s), as the case may be

– 2 –

DEFINITIONS

“Grants” the Share Option Grant and the RSU Grant

“Group” the Company and its subsidiaries and a “member of the Group” shall be construed accordingly

“HK$” Hong Kong dollars, the lawful currency of Hong Kong

“Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

“IND”
investigational new drug or investigational new drug application, also known as clinical trial application
“Independent Board Committee”
the independent committee of the Board comprising all independent non-executive Directors, namely Dr. Cheung Hoi Yu, Mr. Fengmao Hua, Ms. Monin Ung and Ms. Shing Mo Han, Yvonne ( alias Mrs. Yvonne Law), established to advise the Independent Shareholders in respect of the proposed grant of RSUs to the Connected RSU Grantees
“Independent Financial Advisor” or “Rainbow Capital”
Rainbow Capital (HK) Limited, a corporation licensed to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities under the SFO and the independent financial advisor appointed to advise the Independent Board Committee and the Independent Shareholders in relation to the proposed grant of RSUs to the Connected RSU Grantees
“Independent Shareholders”
(i) in the case of the proposed grant of Share Options to Dr. Lu, the Shareholders other than Dr. Lu, his associates and all connected persons of the Company; and (ii) in the case of each of the proposed grant of RSUs to the Connected RSU Grantees, the Shareholders other than each of the Connected RSU Grantees and their respective associates
“Junior Grantee(s)”
any Grantee(s) other than a Senior Grantee

– 3 –

DEFINITIONS

“Latest Practicable Date” January 12, 2023, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

January 12, 2023, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular

“Pre-IPO Equity Incentive Plan” the pre-IPO equity incentive plan adopted by the Company on January 21, 2021, details of which are set out in the prospectus of the Company dated December 20, 2021
“Remuneration Committee” the remuneration committee of the Board
“RNA” ribonucleic acid “RNAi” RNA interference is a biological process in which RNA molecules are involved in sequence-specific suppression of gene expression by double-stranded RNA, through translation or transcriptional repression
“RSU(s)” the restricted share unit(s) granted and/or conditionally granted (as the case may be) under the RSU Scheme
“RSU Annual Mandate” an annual specific mandate granted to the Directors to grant RSUs in respect of such number of new Shares representing not more than 3% of the issued Shares as at the adoption date of the RSU Scheme (i.e. June 28, 2022), details of which are set out in the circular of the Company dated June 13, 2022
“RSU Grant” an aggregate of 903,200 RSUs granted and/or conditionally granted (as the case may be) to the RSU Grantees under the RSU Scheme
“RSU Grantee(s)” the selected Eligible Participant(s) granted and/or proposed to be granted (as the case may be) the RSUs under the RSU Scheme

– 4 –

DEFINITIONS

“RSU Scheme”

the restricted share unit scheme adopted by the Company on April 22, 2022, details of which are set out in the circular of the Company dated June 13, 2022

“Senior Grantee(s)” the Share Option Grantee(s) or the RSU Grantee(s) (as the case may be) who is either (i) a Director, or (ii) a member of the senior management of the Company as included in the latest annual report of the Company published on the website of the Stock Exchange immediately before the Grant Date
“SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
“Share(s)” the ordinary share(s) in the issued share capital of the Company with a par value of US$0.001 each
“Shareholder(s)” the holder(s) of the Share(s) from time to time
“Share Option(s)” the option(s) granted and/or conditionally granted (as the case may be) under the Share Option Scheme
“Share Option Grantee(s)” any Eligible Participant(s) granted and/or proposed to be granted (as the case may be) the Share Options under the Share Option Scheme
“Share Option Grant” an aggregate of 1,511,650 Share Options granted and/or conditionally granted (as the case may be) to the Share Option Grantees under the Share Option Scheme
“Share Option Scheme” the share option scheme adopted by the Company on June 28, 2022, details of which are set out in the circular of the Company dated June 13, 2022

– 5 –

DEFINITIONS

“siRNA” Small interference RNA are double-stranded RNA Molecules comprised of two oligonucleotides of about 20nt-long guide (antisense) and passenger (sense) strands; the RNA-Induced Silencing Complex (RISC) incorporates the guide strand and binds mRNA target molecules to generate its cleavage or inhibit protein translation from it “Stock Exchange” The Stock Exchange of Hong Kong Limited “subsidiary(ies)” has the meaning as defined in the Listing Rules from time to time “substantial shareholder(s)” has the meaning as defined in the Listing Rules from time to time

“Suzhou Sirnaomics” Sirnaomics Biopharmaceuticals (Suzhou) Co., Ltd. (聖諾生物醫藥技術(蘇州)有限公司), a company incorporated under the laws of China on March 10, 2008 with limited liability, an indirect wholly-owned subsidiary of the Company and formerly known as Suzhou Sirnaomics Biopharmaceuticals Co., Ltd. (蘇州聖諾生物醫藥技術有限公司)
“Trustee” Maples Trustee Services (Cayman) Limited, the trustee of the RSU Scheme appointed by the Company, which is independent of the Company and its connected persons
“U.S.” the United States of America “US$” U.S. dollars, the lawful currency of the U.S. “%” per cent

– 6 –

LETTER FROM THE BOARD

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Advancing RNAi Therapeutics

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

Executive Directors:

Dr. Yang Lu ( alias Patrick Lu) (Chairman) Dr. Michael V. Molyneaux Dr. David Mark Evans Dr. Xiaochang Dai

Non-Executive Directors:

Mr. Mincong Huang Mr. Jiankang Zhang

Independent Non-Executive Directors:

Registered office: PO Box 309, Ugland House Grand Cayman, KY1-1104 Cayman Islands

Principal place of business in Hong Kong: 46/F, Hopewell Centre 183 Queen’s Road East Wanchai Hong Kong

Dr. Cheung Hoi Yu

Mr. Fengmao Hua Ms. Monin Ung

Ms. Shing Mo Han, Yvonne ( alias Mrs. Yvonne Law )

January 18, 2023

To the Shareholders

Dear Sir/Madam,

(1) PROPOSED GRANT OF SHARE OPTIONS TO A DIRECTOR; AND (2) CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

INTRODUCTION

The purpose of this circular is to give you the notice of the EGM and the following resolutions to be put forward at the EGM: (i) the proposed grant of Share Options to Dr. Lu; and (ii) each of the proposed grant of RSUs to the Connected RSU Grantees.

– 7 –

LETTER FROM THE BOARD

Reference is made to the announcement of the Company dated November 24, 2022 in respect of, among other things, the proposed grant of Share Options to Dr. Lu and each of the proposed grant of RSUs to the Connected RSU Grantees.

(1) PROPOSED GRANT OF SHARE OPTIONS TO DR. LU

On November 24, 2022, a total of 1,511,650 Share Options were granted and/or conditionally granted (as the case may be) by the Company to 119 Share Option Grantees, subject to acceptance by the Share Option Grantees and compliance with the Listing Rules and the terms of the Share Option Scheme. Among the total of 1,511,650 Share Options, (i) 972,650 Share Options were granted to 114 Share Option Grantees who are employees of the Group and are not connected persons of the Company; (ii) 320,400 Share Options were granted to four Share Option Grantees who are either the directors or chief executive of members of the Group; and (iii) 218,600 Share Options were conditionally granted to Dr. Lu, being the Chairman of the Board, the Chief Executive Officer of the Company, an executive Director and a substantial shareholder of the Company.

The Stock Exchange has previously granted its conditional approval for the listing of, and permission to deal in, new Shares that may be issued on the exercise of the Share Options under the Share Option Scheme subject to the fulfilment of all other conditions of the Share Option Scheme. The total number of new Shares which the Company may issue under the Share Option Scheme and any other share option schemes shall not exceed 8,904,023.

None of the Directors is the trustee of the Share Option Scheme, nor do they have any direct or indirect interest in the trustee of the Share Option Scheme.

Set out below are the details of the proposed grant of Share Options to Dr. Lu:

Grant Date: November 24, 2022

Exercise Price: HK$58.9 per Share, which represents the higher of (rounding up to 1 decimal place):

(i) the closing price of HK$58.5 per Share as stated in the daily quotation sheets of the Stock Exchange on the Grant Date;
(ii) the average closing price of HK$58.9 per Share as stated in the daily quotation sheets of the Stock Exchange for five Business Days immediately preceding the Grant Date; and
(iii) the nominal value of US$0.001 per Share

– 8 –

LETTER FROM THE BOARD

Consideration payable for the HK$1.00 grant of Share Options for Dr. Lu upon acceptance:

Number of Share Options 218,600 Share Options, among which 101,000 and 117,600 conditionally granted: Share Options are divided into 1st batch and 2nd batch respectively

Total number of new Shares to be 218,600 Shares subscribed for upon exercise of the Share Options proposed to be granted:

Option period:

The Share Option(s) shall be valid from the Grant Date and shall continue for a period of 10 years from the Grant Date.

Vesting schedules:

1st batch

50% of the Share Options granted shall vest on each of the first and second anniversary of the Grant Date respectively

2nd batch

25% of the Share Options granted shall vest on each of the first, second, third and fourth anniversary of the Grant Date respectively

Performance target:

No performance target. Given (i) the Share Option Grant is to recognize and reward the relevant Share Option Grantees for their past contributions to the Group, and can encourage, motivate and retain the relevant Share Option Grantees, whose contributions are beneficial to the continual operation, development and long-term growth of the Group; and (ii) the Company also noted other biotechnology and pharmaceutical companies typically did not set performance targets as vesting conditions, the Board and the Remuneration Committee are of the view that it currently is not necessary to set performance targets as vesting conditions of the Share Option Grant.

– 9 –

LETTER FROM THE BOARD

Rights of the new Shares upon the The new Shares, when issued upon the exercise of the exercise of the Share Options: Share Options, will rank pari passu among themselves and with the Shares in issue in all respects, including voting rights, entitlement to dividends, transfer and other rights (including those arising on liquidation of the Company) upon the issue and allotment of the new Shares

Effects on shareholding structure of the Company

As at the Latest Practicable Date, the Company had 87,795,080 Shares in issue. The shareholding effects of the grant of Share Options; (i) as at the Latest Practicable Date; (ii) immediately after the allotment and issue of new Shares upon the full exercise of the Share Options (excluding the proposed grant of Share Options to Dr. Lu); and (iii) immediately after the allotment and issue of new Shares upon the full exercise of the Share Options (including the proposed grant of Share Options to Dr. Lu) (assuming no other change in the issued share capital of the Company other than the allotment, issue and full exercise of the Share Options under (ii) and (iii) above) are set forth below:

				Immediately after the allotment and	Immediately after the allotment and	Immediately after the allotment and	Immediately after the allotment and
				issue of new Shares upon the	full	issue of new Shares upon the	full
				exercise of the Share Options		exercise of the Share Options
				(excluding the proposed grant of		(including the proposed grant of
Name of Shareholder	As at the Latest Practicable Date			Share Options to Dr. Lu)		Share Options to Dr. Lu)
	Number of Shares	_Approximate _	%	Number of Shares Approximate %		Number of Shares Approximate %
Directors, chief executives
and/or substantial
shareholder of members
of the Group
Dr. Lu (Note 1)	10,975,075	12.50		10,975,075	12.32	11,193,675	12.53
Dr. Dai (Note 2)	7,850,007	8.94		7,995,007	8.97	7,995,007	8.95
Dr. Molyneaux (Note 3)	—		—	99,350	0.11	99,350	0.11
Dr. Evans (Note 4)	91,538	0.10		152,588	0.17	152,588	0.17
Dr. Yang	—		—	15,000	0.02	15,000	0.02
Mr. Mincong Huang	757,551	0.86		757,551	0.85	757,551	0.85
(Note 5)
Sub-total	19,674,171	22.41		19,994,571	22.44	20,213,171	22.63

– 10 –

LETTER FROM THE BOARD

Name of Shareholder Other connected persons of the Company who are not entitled to the Share Option Grant Sub-total Public Shareholders Total	As at the Latest Practicable Date Number of Shares Approximate % 336,500 0.38 336,500 0.38 67,784,409 77.21 87,795,080 100 (Note 7)	Immediately after the allotment and issue of new Shares upon the full exercise of the Share Options (excluding the proposed grant of Share Options to Dr. Lu) Number of Shares Approximate % 336,500 0.38 336,500 0.38 68,757,059 (Note 6) 77.18 89,088,130 100 (Note 7)	Immediately after the allotment and issue of new Shares upon the full exercise of the Share Options (including the proposed grant of Share Options to Dr. Lu) Number of Shares Approximate % 336,500 0.38 336,500 0.38 68,757,059 (Note 6) 76.99 89,306,730 100 (Note 7)

Notes:

(1) Dr. Lu is the settlor of The Yang Lu Family Trust and the beneficiaries of The Yang Lu Family Trust are Zheng Joan Wang and Laura Yao Lu, being Dr. Lu’s spouse and daughter, respectively. Zheng Joan Wang and Laura Yao Lu are co-trustees of The Yang Lu Family Trust. Therefore, Dr. Lu is deemed to be interested in the 2,500,000 Shares held by The Yang Lu Family Trust. Under the SFO, the deemed interest of Dr. Lu consists of (i) 2,500,000 Shares held by The Yang Lu Family Trust, (ii) 8,475,075 Shares held by Dr. Lu himself and (iii) options granted to Dr. Lu to subscribe for 1,925,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Lu’s entitlements to receive up to 1,925,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(2) Value Measure Investments Limited and Trinity Power Limited are wholly-owned by Dr. Dai. Under the SFO, Dr. Dai is deemed to be interested in 7,850,007 Shares held by Value Measure Investments Limited and Trinity Power Limited. Dr. Dai is also interested in options granted to him to subscribe for 450,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Dai’s entitlements to receive up to 450,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(3) Dr. Molyneaux is interested in options granted to him to subscribe for 1,510,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Molyneaux’s entitlements to receive up to 1,510,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(4) Dr. Evans is interested in options granted to him to subscribe for 965,000 Shares under the Pre-IPO Equity Incentive Plan and 91,538 Shares jointly held by him and his spouse, Julee Ann Evans. For the avoidance of doubt, this does not include Dr. Evans’s entitlements to receive up to 965,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.

– 11 –

LETTER FROM THE BOARD

(5) Soaring Star Ventures Limited owns 600,601 Shares. The Huang Family Trust is the beneficiary of Soaring Star Ventures Limited and Mr. Mincong Huang is the beneficiary of the Huang Family Trust. Mr. Mincong Huang also owns 156,950 Shares. Accordingly, Mr. Mincong Huang is deemed to be interested in 757,551 Shares.
(6) 972,650 Share Options were granted to other Share Option Grantees who are employees of the Group.
(7) The percentages of the Shares are rounded to the nearest two decimal places, and the total number of the percentages may not add up to 100% due to rounding.

Listing Rules Implications

Pursuant to Rule 17.04(1) of the Listing Rules and the terms of the Share Option Scheme, each grant of Share Options to a director, chief executive or substantial shareholder of the Company or any of their respective associates, shall be subject to the approval by the independent non-executive Directors (and in the event that the Board offers to grant Share Options to an independent non-executive Director, the vote of such independent non-executive Director shall not be counted for the purposes of approving such grant). Accordingly, the Share Option Grant to each of Dr. Lu, being the Chairman of the Board, the Chief Executive Officer of the Company, an executive Director and a substantial shareholder of the Company, and Dr. Dai, Dr. Molyneaux and Dr. Evans, being the executive Directors, has been approved by the independent non-executive Directors.

Each of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans, being the executive Directors, had abstained from voting on respective Board resolutions approving each of their own Share Option Grant. Save for the above, no other Director had a material interest in the Share Option Grant and therefore none of the other Directors had abstained from voting on the relevant Board resolutions approving the Share Option Grant (including the proposed grant of Share Options to Dr. Lu).

Pursuant to Rule 17.04(1) of the Listing Rules and the terms of the Share Option Scheme, if Share Options are granted to a substantial shareholder or an independent non-executive director of the Company (or any of their respective associates) and that Share Option Grant would result in the Shares issued and to be issued upon exercise of all Share Options already granted and to be granted (including Share Options exercised, cancelled and outstanding) to such person under the Share Option Scheme or any other schemes of the Company in the 12-month period up to and including the Grant Date: (i) representing in aggregate over 0.1%, or such other percentage as may from time to time be provided under the Listing Rules, of the Shares in issue on the Grant Date; and (ii) having an aggregate value, based on the official closing price of the Shares as stated in the daily quotation sheets of the Stock Exchange on the Grant Date, in excess of HK$5 million, such grant of Share Options shall also be subject to the approval of the Shareholders in general meeting at which such person and his/her/its associates and all connected persons of the Company shall abstain from voting.

– 12 –

LETTER FROM THE BOARD

Upon the exercise of the Share Options proposed to be granted to Dr. Lu under the Share Option Scheme, Dr. Lu will be entitled to subscribe for 218,600 Shares, representing approximately 0.2% of the Shares in issue as at the Latest Practicable Date and exceeding 0.1% of the Shares in issue on the Grant Date. In addition, the Share Options proposed to be granted to Dr. Lu would have an aggregate value, based on the closing price of Shares on the Grant Date, of approximately HK$12.8 million and exceeding HK$5 million. Accordingly, the proposed grant of Share Options to Dr. Lu is subject to the Independent Shareholders’ approval at the EGM and Dr. Lu and his associate (i.e. The Yang Lu Family Trust) and all connected persons of the Company shall abstain from voting at the relevant resolution at the EGM.

Dr. Lu had abstained from voting on the Board resolution approving his own Share Option Grant. Save for the above, no other Director had a material interest in the proposed grant of Share Options to Dr. Lu and therefore none of the other Directors had abstained from voting on the Board resolution approving the proposed grant of Share Options to Dr. Lu.

(2) PROPOSED GRANT OF RSUs TO THE CONNECTED RSU GRANTEES

The RSU Scheme is neither a share option scheme nor an arrangement analogous to a share option scheme for the purpose of Chapter 17 of the Listing Rules.

On June 28, 2022, the RSU Annual Mandate was granted by the Shareholders to the Directors at an extraordinary general meeting, pursuant to which the maximum number of new Shares which may be issued under the RSU Annual Mandate is 2,671,206. The Stock Exchange has previously granted its conditional approval for the listing of, and permission to deal in, new Shares that may be issued pursuant to the RSU Annual Mandate subject to the fulfilment of all other conditions of the RSU Scheme.

On November 24, 2022, a total of 903,200 RSUs were granted and/or conditionally granted (as the case may be) by the Company to 119 RSU Grantees, subject to acceptance by the RSU Grantees and compliance with the terms of the RSU Scheme. Among the total of 903,200 RSUs, (i) 564,200 RSUs were granted to 114 RSU Grantees who are employees of the Group and are not connected persons of the Company; and (ii) 339,000 RSUs were conditionally granted to Connected RSU Grantees who are either the directors, chief executives and/or substantial shareholder of members of the Group.

The RSU Grant shall be satisfied by the issue and allotment of new Shares under the RSU Annual Mandate to the Trustee in accordance with the terms of the RSU Scheme. The Company has appointed the Trustee to assist with the administration and vesting of RSUs granted pursuant to

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LETTER FROM THE BOARD

the RSU Scheme. The Trustee has been provided with a list of beneficiaries who are RSU Grantees which shows (i) the identities of each beneficiary and whether he/she/it is a connected person of the Company; and (ii) the number of new Shares owned by each beneficiary respectively.

Given the RSU Grant will be satisfied solely by the issue and allotment of new Shares under the RSU Annual Mandate, the Trustee will receive new Shares to be held on trust shortly after the RSU Grant. These RSUs will be held by the Trustee on trust for the RSU Grantees and will be transferred to them at no cost upon vesting of their respective RSUs. As such, no fund will be raised by the Company as a result of the issue and allotment of the new Shares.

The new Shares to be issued and allotted by the Company to the Trustee pursuant to the RSU Grant represent approximately 1.0% of the issued Shares as at the Latest Practicable Date. The new Shares, when issued and fully-paid, will rank pari passu among themselves and with the Shares in issue in all respects, including voting rights, entitlement to dividends, transfer and other rights (including those arising on liquidation of the Company) upon the issue and allotment of the new Shares.

The closing price of the Shares on the Grant Date as quoted on the Stock Exchange is HK$58.5 per Share. Based on the closing price of HK$58.5 per Share on the Grant Date, the market value of the Awards granted to the Connected RSU Grantees amounts to approximately HK$19.8 million.

Set out below are the details of the proposed grant of RSUs to the Connected RSU Grantees:

Grant Date: November 24, 2022 Consideration payable for the HK$1.00 Award of RSUs for each Connected RSU Grantee upon acceptance: Number of RSUs conditionally 339,000 RSUs, among which 294,200 and 44,800 RSUs are granted: divided into 1st batch and 2nd batch respectively Total number of new Shares to be 339,000 Shares issued and allotted of the RSUs granted:

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LETTER FROM THE BOARD

RSU period

The RSU(s) shall be valid from the Grant Date and shall continue for a period of 10 years from the Grant Date.

Vesting schedules:

1st batch

50% of the RSUs granted shall vest on each of the first and second anniversary of the Grant Date respectively

2nd batch

25% of the RSUs granted shall vest on each of the first, second, third and fourth anniversary of the Grant Date respectively

Given (i) the RSU Grant is to recognize and reward the relevant RSU Grantees for their past contributions to the Group, and can encourage, motivate and retain the relevant RSU Grantees, whose contributions are beneficial to the continual operation, development and long-term growth of the Group; and (ii) the Company also noted other biotechnology and pharmaceutical companies typically did not set performance targets as vesting conditions, the Board and the Remuneration Committee are of the view that it currently is not necessary to set performance targets as vesting conditions of the RSU Grant.

The table below shows a breakdown of RSUs that were conditionally granted to the directors, chief executives and/or substantial shareholder of members of the Group:

Name of the RSU Grantees Position held with the Company/relationship with the Group Dr. Lu Chairman, Chief Executive Officer, Executive Director and substantial shareholder of the Company Dr. Dai Executive Director Dr. Molyneaux Chief Medical Officer and Executive Director Dr. Evans Chief Scientific Officer and Executive Director Dr. Yang General Manager of a subsidiary of the Company Total	Number of RSUs 118,400 100,000 68,100 43,200 9,300
	339,000

Name of the RSU
Grantees
Position held with the Company/relationship with
the Group
Dr. Lu
Chairman, Chief Executive Officer, Executive Director
and substantial shareholder of the Company
Dr. Dai
Executive Director
Dr. Molyneaux
Chief Medical Officer and Executive Director
Dr. Evans
Chief Scientific Officer and Executive Director
Dr. Yang
General Manager of a subsidiary of the Company
Total

Number of
RSUs
118,400
100,000
68,100
43,200
9,300

339,000

– 15 –

LETTER FROM THE BOARD

Effects on shareholding structure of the Company

As at the Latest Practicable Date, the Company had 87,795,080 Shares in issue. The shareholding effects of the grant of RSUs: (i) as at the Latest Practicable Date; (ii) immediately after the allotment and issue of new Shares in relation to the RSU Grant (excluding the proposed grant of RSUs to the Connected RSU Grantees); and (iii) immediately after the allotment and issue of new Shares in relation to the RSU Grant (including the proposed grant of RSUs to the Connected RSU Grantees) (assuming no other change in the issued share capital of the Company other than the allotment and issue of new Shares in relation to the RSU Grant under (ii) and (iii) above) are set forth below:

Name of Shareholder Directors, chief executives and/or substantial shareholder of members of the Group Dr. Lu (Note 1) Dr. Dai (Note 2) Dr. Molyneaux (Note 3) Dr. Evans (Note 4) Dr. Yang Mr. Mincong Huang (Note 5) Sub-total Other connected persons of the Company who are not entitled to the RSU Grant Sub-total Public Shareholders Total	As at the Latest Practicable Date Number of Shares Approximate % 10,975,075 12.50 7,850,007 8.94 — — 91,538 0.10 — — 757,551 0.86 19,674,171 22.41 336,500 0.38 336,500 0.38 67,784,409 77.21 87,795,080 100 (Note 7)	Immediately after the allotment and issue of new Shares under the RSU Scheme (excluding the proposed grant of RSUs to the Connected RSU Grantees) Number of Shares Approximate % 10,975,075 12.42 7,850,007 8.88 — — 91,538 0.10 — — 757,551 0.86 19,674,171 22.27 336,500 0.38 336,500 0.38 68,348,609 (Note 6) 77.35 88,359,280 100 (Note 7)	Immediately after the allotment and issue of new Shares under the RSU Scheme (including the proposed grant of RSUs to the Connected RSU Grantees) Number of Shares Approximate % 11,093,475 12.51 7,950,007 8.96 68,100 0.08 134,738 0.15 9,300 0.01 757,551 0.85 20,013,171 22.56 336,500 0.38 336,500 0.38 68,348,609 (Note 6) 77.06 88,698,280 100 (Note 7)

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LETTER FROM THE BOARD

Notes:

(1) Dr. Lu is the settlor of The Yang Lu Family Trust and the beneficiaries of The Yang Lu Family Trust are Zheng Joan Wang and Laura Yao Lu, being Dr. Lu’s spouse and daughter, respectively. Zheng Joan Wang and Laura Yao Lu are co-trustees of The Yang Lu Family Trust. Therefore, Dr. Lu is deemed to be interested in the 2,500,000 Shares held by The Yang Lu Family Trust. Under the SFO, the deemed interest of Dr. Lu consists of (i) 2,500,000 Shares held by The Yang Lu Family Trust, (ii) 8,475,075 Shares held by Dr. Lu himself and (iii) options granted to Dr. Lu to subscribe for 1,925,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Lu’s entitlements to receive up to 1,925,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(2) Value Measure Investments Limited and Trinity Power Limited are wholly-owned by Dr. Dai. Under the SFO, Dr. Dai is deemed to be interested in 7,850,007 Shares held by Value Measure Investments Limited and Trinity Power Limited. Dr. Dai is also interested in options granted to him to subscribe for 450,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Dai’s entitlements to receive up to 450,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(3) Dr. Molyneaux is interested in options granted to him to subscribe for 1,510,000 Shares under the Pre-IPO Equity Incentive Plan. For the avoidance of doubt, this does not include Dr. Molyneaux’s entitlements to receive up to 1,510,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(4) Dr. Evans is interested in options granted to him to subscribe for 965,000 Shares under the Pre-IPO Equity Incentive Plan and 91,538 Shares jointly held by him and his spouse, Julee Ann Evans. For the avoidance of doubt, this does not include Dr. Evans’s entitlements to receive up to 965,000 Shares pursuant to the exercise of share options under the Pre-IPO Equity Incentive Plan.
(5) Soaring Star Ventures Limited owns 600,601 Shares. The Huang Family Trust is the beneficiary of Soaring Star Ventures Limited and Mr. Mincong Huang is the beneficiary of the Huang Family Trust. Mr. Mincong Huang also owns 156,950 Shares. Accordingly, Mr. Mincong Huang is deemed to be interested in 757,551 Shares.
(6) 564,200 RSUs were granted to other RSU Grantees who are employees of the Group.
(7) The percentages of the Shares are rounded to the nearest two decimal places, and the total number of the percentages may not add up to 100% due to rounding.

Listing Rules Implications

The Connected RSU Grantees, being either the directors, chief executives and/or substantial shareholder of members of the Group, are connected persons of the Company pursuant to Rule 14A.07 of the Listing Rules. Therefore, each of the proposed grant of RSUs to the Connected RSU Grantees constitutes a non-exempt connected transaction for the Company under Chapter 14A of the Listing Rules. As such, each of the proposed grant of RSUs to the Connected RSU Grantees is subject to the reporting, announcement, circular and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

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LETTER FROM THE BOARD

Pursuant to Chapter 14A of the Listing Rules, Shareholders with a material interest in each of the proposed grant of RSUs to the Connected RSU Grantees are required to abstain from voting on the relevant resolutions at the EGM. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, as at the Latest Practicable Date:

(i) Dr. Lu and his associate (i.e. The Yang Lu Family Trust) held a total of 10,975,075 Shares, representing approximately 12.50% of the total number of issued Shares. Save for this, there are no other Shareholders having any material interest in the proposed grant of RSUs to Dr. Lu, accordingly, save for Dr. Lu and his associate, no Shareholder is required under the Listing Rules to abstain from voting at the EGM on the resolution approving the proposed grant of RSUs to Dr. Lu;
(ii) Dr. Dai and his associates (i.e. Value Measure Investments Limited and Trinity Power Limited) beneficially held a total of 7,850,007 Shares, representing approximately 8.94% of the total number of issued Shares. Save for this, there are no other Shareholders having any material interest in the proposed grant of RSUs to Dr. Dai, accordingly, save for Dr. Dai and his associates, no Shareholder is required under the Listing Rules to abstain from voting at the EGM on the resolution approving the proposed grant of RSUs to Dr. Dai;
(iii) Dr. Molyneaux and his associates did not hold any Shares. As such, there is no Shareholder having any material interest in the proposed grant of RSUs to Dr. Molyneaux, accordingly, no Shareholder is required under the Listing Rules to abstain from voting at the EGM on the resolution approving the proposed grant of RSUs to Dr. Molyneaux;
(iv) Dr. Evans and his associate (i.e. his spouse, Julee Ann Evans) held a total of 91,538 Shares, representing approximately 0.10% of the total number of issued Shares. Save for this, there are no other Shareholders having any material interest in the proposed grant of RSUs to Dr. Evans, accordingly, save for Dr. Evans and his associate, no Shareholder is required under the Listing Rules to abstain from voting at the EGM on the resolution approving the proposed grant of RSUs to Dr. Evans; and

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LETTER FROM THE BOARD

(v) Dr. Yang and his associates did not hold any Shares. As such, there is no Shareholder having any material interest in the proposed grant of RSUs to Dr. Yang, accordingly, no Shareholder is required under the Listing Rules to abstain from voting at the EGM on the resolution approving the proposed grant of RSUs to Dr. Yang.

REASONS FOR AND BENEFITS OF THE PROPOSED GRANT OF SHARE OPTIONS TO DR. LU AND THE PROPOSED GRANT OF RSUs TO THE CONNECTED RSU GRANTEES

The Company is an RNA therapeutics biopharmaceutical company with product candidates in pre-clinical and clinical stages that focuses on the discovery and development of innovative drugs for indications with medical needs and large market opportunities. The Company is the first clinical-stage RNA therapeutics company to have a strong presence in both China and the U.S., and also the first company to achieve positive Phase IIa clinical outcomes in oncology for an RNAi therapeutic for its core product, STP705.

The Share Option Scheme and the RSU Scheme form part of the incentive schemes of the Group to help attract and retain talents in demand in the biotechnology industry in both the United States and Asia. The Board and the Remuneration Committee consider that the Grants aim to (i) recognize the contributions made to the Group by the Grantees; (ii) encourage, motivate and retain the Grantees, whose contributions are beneficial to the continual operation, development and long-term growth of the Group; and (iii) provide additional incentive for the Grantees to continuously generate new clinical assets and facilitate the commercialization of the Group’s assets in the pipeline, with a view to achieve the objectives of increasing the value of the Group and aligning the interests of the Grantees to the Shareholders through ownership of Shares.

The number and value of Share Options proposed to be granted to Dr. Lu and RSUs proposed to be granted to each of the Connected RSU Grantees is primarily determined by the Board (in the case of Senior Grantees) and the Chief Executives (in the case of Junior Grantees) with reference to, among other things, their respective roles, responsibilities, work experience, contributions and remuneration packages, as well as the market value of the share options, awarded shares or restricted share units granted to the directors, senior management and employees of comparable companies.

As the proposed grant of Share Options to Dr. Lu and the proposed grant of RSUs to the Connected RSU Grantees will be satisfied by the issue and allotment of new Shares, there will not be any actual cash outflow by the Group under the proposed grant of Share Options to Dr. Lu and the proposed grant of RSUs to the Connected RSU Grantees. Furthermore, the dilution effect of the proposed grant of Share Options to Dr. Lu and the proposed grant of RSUs to the Connected RSU Grantees to the shareholding interests of the existing public Shareholders is expected to be insignificant.

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LETTER FROM THE BOARD

With respect to the proposed grant of Share Options and RSUs to Dr. Lu, being the Chairman, Chief Executive Officer, Executive Director and substantial shareholder of the Company and the proposed grant of RSUs to directors and chief executive of members of the Group, namely, Dr. Dai, Dr. Molyneaux, Dr. Evans and Dr. Yang, it serves as a discretionary bonus in recognition of their valuable and substantial contributions to the Group.

Dr. Lu has successfully led the development of early discovery programs utilizing the Group’s proprietary delivery platforms in both the U.S. and China, and formulated the clinical strategy. He managed to complete multiple pre-IPO funding rounds with participation from renowned institutional investors, industry players and healthcare specialists. In 2021, Dr. Lu brought the Group public on the Stock Exchange. After the successful listing of the Shares, Dr. Lu continues overseeing the research and development and operation, business development and commercialization of assets of the Group. Dr. Lu, together with Dr. Dai, currently sits on the board of RNAimmune, Inc., a non-wholly-owned subsidiary of the Company, to oversee the Company’s development of the messenger RNA asset.

Dr. Dai is an executive Director and the Scientific and Strategic Director of the Group. He was appointed as a non-executive Director and was re-designated to an executive Director with effect from July 19, 2022. Dr. Dai joined the Group in April 2016 and participates in the formulation of the general corporate business plans, strategies and major decisions of the Company through the Board.

Dr. Dai was the sole investor in the Group’s Series B pre-IPO financing round and introduced pre-IPO investors, strategic partners and business development partners to the Group via his network in both the global biotechnology sector and capital market. Dr. Dai was involved in assisting in the screening and appointment of all the senior management of the Group. Since his re-designation as an executive Director, Dr. Dai is involved in advising on the strategy of the Group and providing advices and guidelines on the scientific development of the Group. Dr. Dai, together with Dr. Lu, currently sits on the board of RNAimmune, Inc., to oversee the Company’s development of the messenger RNA asset.

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LETTER FROM THE BOARD

Dr. Molyneaux is an executive Director and the Chief Medical Officer of the Group. Dr. Molyneaux joined the Group in November 2015 and is responsible for the development of clinical operations, medical affairs and regulatory affairs; responsible for managing external vendors and consultants; and responsible for leading key opinion leader engagement and activities to support multiple projects.

Dr. Molyneaux has advised and driven the global clinical strategy, IND filings of pipeline and the clinical trials in the U.S. Dr. Molyneaux is responsible for communicating with principal investigators and designing clinical protocols.

Dr. Evans is an executive Director and the Chief Scientific Officer of the Group. He first joined the Group in March 2008 and served as an executive vice president of research and development of the Group until January 2013. Dr. Evans rejoined in July 2018 and is responsible for scientific, technological and research operations in oncology and fibrosis. Dr. Evans has rich experience in pharmaceutical research and focuses on the development of siRNA therapeutics in oncology and fibrosis.

Dr. Evans led the pre-clinical team in both the U.S. and China in the early discovery and development of the polypeptide nanoparticle delivery system platforms and moved the Group’s two lead clinical drug candidates, STP705 and STP707 asset to IND filing stage in the past.

Dr. Yang is the General Manager of Suzhou Sirnaomics and the China Chief Scientific Officer of the Group. He joined the Group in November 2020 and was appointed as General Manager of Suzhou Sirnaomics in August 2022. Dr. Yang oversees the operation of Suzhou Sirnaomics and is responsible for the nucleic acid chemistry program for RNAi drug enabling, identification of new RNA therapeutic targets and development of new collaboration programs.

Since joining the Group, Dr. Yang has proposed and contributed to: (i) new siRNA duplex structure, (ii) innovative siRNA delivery system, (iii) innovative modified siRNA chemistry. In addition, Dr. Yang has also contributed towards two intellectual property applications and an IND enabling program.

In light of the above, the Directors (including members of the Independent Board Committee) consider that the number of Share Options and RSUs conditionally granted and the terms and conditions of the proposed grant of Share Options to Dr. Lu and the each of the proposed grant of RSUs to the Connected RSU Grantees is fair and reasonable and is in the interests of the Company and the Shareholders as a whole.

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LETTER FROM THE BOARD

NOTICE OF THE EGM

Set out on pages 56 to 58 of this circular is the notice of the EGM at which, inter alia, ordinary resolutions will be proposed to the Independent Shareholders to consider and approve: (i) the proposed grant of Share Options to Dr. Lu; and (ii) each of the proposed grant of RSUs to the Connected RSU Grantees.

FORM OF PROXY

A form of proxy for use at the EGM is enclosed with this circular and such form of proxy is also published on the websites of Hong Kong Exchanges and Clearing Limited (https://www.hkexnews.hk) and the Company (https://www.sirnaomics.com).

To be valid, the form of proxy must be completed and signed in accordance with the instructions printed thereon and deposited at the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time of the EGM or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting in person at the EGM if you so wish. The Company strongly recommends you to monitor the development of the COVID-19 situation and to assess, based on the social distancing policies, the necessity for attending the EGM in person.

EGM

To the best of knowledge, belief and information of the Directors, having made all reasonable enquiries, save for Dr. Lu, his associate (i.e. The Yang Lu Family Trust) and all connected persons of the Company, which are required to abstain from voting on the relevant resolution in relation to the proposed grant of Share Options to Dr. Lu, no other Shareholder has a material interest in the relevant resolution which would be required to abstain from voting on the relevant resolution at the EGM.

To the best of knowledge, belief and information of the Directors, having made all reasonable enquiries, save for Dr. Lu, Dr. Dai, Dr. Molyneaux, Dr. Evans, Dr. Yang and their respective associates which are required to abstain from voting on the relevant resolution in relation to the proposed grant of RSUs to each of them, no other Shareholder has a material interest in the relevant resolutions which would be required to abstain from voting on the relevant resolutions at the EGM.

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LETTER FROM THE BOARD

The Trustee is not a connected person for the purpose of Rule 14A.12 of the Listing Rules. To the best knowledge of the Directors and having made all reasonable enquiries, as at the Latest Practicable Date, the Trustee holds a total of 11,556,217 Shares, representing approximately 13.2% of the issued Shares. These Shares were issued to the Trustee pursuant to the Pre-IPO Equity Incentive Plan. The Trustee will not exercise the voting rights in respect of these Shares at the EGM.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules and clause 13.5 of the Articles of Association, any resolution put to the vote of the Shareholders at a general meeting shall be decided on a poll except where the chairman of the general meeting, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. Accordingly, each of the resolutions set out in the notice will be taken by way of poll.

On a poll, every Shareholder present in person or by proxy or, in the case of a Shareholder being a corporation, by its duly authorized representative, shall have one vote for every fully paid Share of which he/she/it is the holder. A Shareholder entitled to more than one vote needs not use all his/her/its votes or cast all the votes he/she/it uses in the same way.

An announcement on the poll vote results will be made by the Company after the EGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

Online participation

– 23 –

LETTER FROM THE BOARD

CLOSURE OF REGISTER OF MEMBERS

For the purpose of determining the identity of the Shareholders entitled to attend and vote at the EGM, the register of members of the Company will be closed from Tuesday, January 31, 2023 to Friday, February 3, 2023 both dates inclusive, during which period no transfer of Shares will be effected. All transfers accompanied by the relevant certificates must be lodged with the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712−1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong for registration not later than 4:30 p.m. on January 30, 2023.

RECOMMENDATION

The Directors (including members of the Independent Board Committee) consider that the resolutions to be proposed at the EGM in relation to (i) the proposed grant of Share Options to Dr. Lu; and (ii) each of the proposed grant of RSUs to the Connected RSU Grantees (including issue and allotment of new Shares thereunder) are on normal commercial terms and in the ordinary and usual course of business of the Group, fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole. The Directors therefore recommend the Independent Shareholders to vote in favor of all the resolutions to be proposed at the EGM.

GENERAL

Your attention is also drawn to the appendix to this circular.

Yours faithfully By order of the Board Sirnaomics Ltd. Yang (Patrick) Lu

Chairman and Executive Director

– 24 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

==> picture [25 x 26] intentionally omitted <==

Advancing RNAi Therapeutics

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

January 18, 2023

To the Independent Shareholders

Dear Sir/Madam,

CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

We refer to the circular of the Company to the Shareholders dated January 18, 2023 (the “ Circular ”), of which this letter forms a part. Unless the context otherwise requires, capitalized terms used in this letter shall have the same meanings as those defined in the Circular.

We have been appointed as members of the Independent Board Committee to advise the Independent Shareholders in relation to the proposed grant of RSUs to the Connected RSU Grantees, details of which are set out in the “Letter from the Board” in the Circular. Rainbow Capital has been appointed as the Independent Financial Advisor to advise the Independent Board Committee and the Independent Shareholders in this regard.

We wish to draw your attention to the “Letter from the Board” set out on pages 7 to 24 of the Circular and the “Letter from the Independent Financial Advisor” set out on pages 27 to 48 of the Circular.

Having taken into account, among other things, the principal factors and reasons considered by, and the advice of, the Independent Financial Advisor, regarding each of the proposed grant of RSUs to the Connected RSU Grantees, as set out in the “Letter from the Independent Financial Advisor” in the Circular, we concur with the view of the Independent Financial Advisor and are of the view that each of the proposed grant of RSUs to the Connected RSU Grantees, is on normal commercial terms and in the ordinary and usual course of business of the Group, fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole.

– 25 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions to be proposed at the EGM in relation to each of the proposed grant of RSUs to the Connected RSU Grantees.

Yours faithfully For and on behalf of the Independent Board Committee

Dr. Cheung Hoi Yu

Mr. Fengmao Hua Ms. Monin Ung Ms. Shing Mo Han, Yvonne ( alias Mrs. Yvonne Law)

Independent non-executive Directors

– 26 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

The following is the full text of a letter of advice from Rainbow Capital, the Independent Financial Advisor to the Independent Board Committee and the Independent Shareholders in respect of the proposed grant of RSUs to the Connected RSU Grantees under the RSU Scheme, which has been prepared for the purpose of incorporation in this circular.

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January 18, 2023

To the Independent Board Committee and the Independent Shareholders

Sirnaomics Ltd. 46/F, Hopewell Centre 183 Queen’s Road East Wanchai Hong Kong

Dear Sir or Madam,

CONNECTED TRANSACTION PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

INTRODUCTION

We refer to our appointment as the independent financial advisor to the Independent Board Committee and the Independent Shareholders in respect of the proposed grant of RSUs by the Company to the Connected RSU Grantees under the RSU Scheme (the “ Connected Grant ”), details of which are set out in the “Letter from the Board” (the “ Letter from the Board ”) contained in the circular issued by the Company to the Shareholders dated January 18, 2023 (the “ Circular ”), of which this letter forms part. Unless the context otherwise requires, capitalized terms used in this letter shall have the same meanings as those defined in the Circular.

On November 24, 2022, a total of 903,200 RSUs were granted and/or conditionally granted (as the case may be) by the Company to 119 RSU Grantees, among which 339,000 RSUs were conditionally granted to the Connected RSU Grantees who are either the directors, chief executives and/or substantial shareholder of members of the Group. The Connected RSU Grantees are

– 27 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

connected persons of the Company pursuant to Rule 14A.07 of the Listing Rules. Therefore, each of the proposed grant of RSUs to the Connected RSU Grantees constitutes a non-exempt connected transaction for the Company under Chapter 14A of the Listing Rules.

Each of the proposed grant of RSUs to the Connected RSU Grantees was approved by the Board and the Remuneration Committee. Each of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans, being the executive Directors, had abstained from voting on the respective Board resolutions approving each of their own RSU Grant. Pursuant to Chapter 14A of the Listing Rules, Shareholders with a material interest in each of the proposed grant of RSUs to the Connected RSU Grantees are required to abstain from voting on the relevant resolutions at the EGM. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, as at the Latest Practicable Date, Dr. Lu, Dr. Dai and Dr. Evans are Shareholders. Hence, each of Dr. Lu, Dr. Dai and Dr. Evans and their respective associates are required to abstain from voting at the EGM on the respective resolution approving the proposed grant of the RSUs to themselves.

The Independent Board Committee, comprising all the independent non-executive Directors, namely Dr. Cheung Hoi Yu, Mr. Fengmao Hua, Ms. Monin Ung and Ms. Shing Mo Han, Yvonne ( alias Mrs. Yvonne Law), has been formed to advise the Independent Shareholders on whether (i) the Connected Grant is conducted in the ordinary and usual course of business of the Group; and (ii) the terms of the Connected Grant are on normal commercial terms which are fair and reasonable and in the interests of the Company and the Shareholders as a whole, and advise the Independent Shareholders as to voting. We, Rainbow Capital, have been appointed as the Independent Financial Advisor to advise the Independent Board Committee and the Independent Shareholders in this regard.

As at the Latest Practicable Date, we did not have any relationships or interests with the Group that could reasonably be regarded as relevant to our independence. In the last two years, there was no engagement between the Group and us. Apart from normal professional fees paid or payable to us in connection with this appointment as the Independent Financial Advisor, no arrangements exist whereby we had received any fees or benefits from the Group. Accordingly, we are qualified to give independent advice in respect of the Connected Grant.

BASIS OF OUR OPINION

In formulating our opinion and advice, we have relied on (i) the information and facts contained or referred to in the Circular; (ii) the information supplied by the Group and its advisers; (iii) the opinions expressed by and the representations of the Directors and the management of the Group; and (iv) our review of the relevant public information. We have assumed that all the information provided and representations and opinions expressed to us or contained or referred to in the Circular were true, accurate and complete in all respects as at the date thereof and may be

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

relied upon. We have also assumed that all statements contained and representations made or referred to in the Circular are true at the time they were made and continue to be true as at the Latest Practicable Date and all such statements of belief, opinions and intentions of the Directors and the management of the Group and those as set out or referred to in the Circular were reasonably made after due and careful enquiry. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors and the management of the Group. We have also sought and received confirmation from the Directors that no material facts have been withheld or omitted from the information provided and referred to in the Circular and that all information or representations provided to us by the Directors and the management of the Group are true, accurate, complete and not misleading in all respects at the time they were made and continued to be so until the date of the Circular.

We consider that we have reviewed sufficient information currently available to reach an informed view and to justify our reliance on the accuracy of the information contained in the Circular so as to provide a reasonable basis for our recommendation. We have not, however, carried out any independent verification of the information provided, representations made or opinion expressed by the Directors and the management of the Group, nor have we conducted any form of in-depth investigation into the business, affairs, operations, financial position or future prospects of the Company or its substantial shareholders, subsidiaries or associates.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion and recommendation, we have taken into account the following principal factors and reasons:

1. Information on the Group

(i) Business of the Group

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

(ii) Financial information of the Group

Set out below is summary of the key consolidated financial information of the Group for the years ended December 31, 2020 and 2021 (“ FY2021 ”) and the six months ended June 30, 2021 and 2022 (“ 6M2022 ”) as extracted from the annual report of the Company for FY2021 (“ 2021 Annual Report ”) and the interim report of the Company for 6M2022, respectively:

	6M2022	6M2021	FY2021	FY2020
	US$’000	US$’000	US$’000	US$’000
	(unaudited)	(unaudited)	(audited)	(audited)
Changes in fair value of financial
liabilities at fair value through
profit or loss	2,877	12,338	146,038	17,574
Research and development expenses	32,109	12,337	40,673	14,894
Loss for the period/year	46,100	33,526	215,934	46,428

The product pipelines of the Group were still in clinical or pre-clinical stage and hence no revenue was yet to be generated during FY2021 and 6M2022. As a biopharmaceutical company, the primary cost of the Group comprised the research and development expenses. The Group has developed and established proprietary RNA delivery platforms, and built an enriched product pipeline addressing oncology, fibrosis diseases, viral infections and liver metabolic diseases. As at June 30, 2022, the Group had two lead product clinical drug candidates which had eight ongoing clinical trials in the U.S., and at least 16 other products in preclinical studies. The Group’s leading RNAi therapeutic candidate has demonstrated positive clinical results for treatment of non-melanoma skin cancer.

Going forward, the Group have set the following business priorities and initiative: (i) advance the development of its lead product candidates through clinical trials towards market approvals in a broad range of indications in the U.S. and China for candidate STP705 and STP707; (ii) develop more innovative first-in-class preclinical assets, which include multiple siRNA molecules that employ different targeting and nanoparticle technologies, into clinical stage; and (iii) selectively pursue synergistic collaboration opportunities to maximize the potential of the Group’s clinical product candidates.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

2. Principle terms of the Connected Grant

Details of the principal terms of the Connected Grant are set out in Letter from the Board, which are summarized below:

Grant date : November 24, 2022 Connected RSU Grantees : The table below shows a breakdown of RSUs that were conditionally granted to the directors, chief executives and/or substantial shareholder of members of the Group:

Position held

Position held
Name of the RSU Grantees with the Company/ relationship with the Group Dr. Lu Chairman, Chief Executive Officer, Executive Director and substantial shareholder of the Company Dr. Dai Executive Director Dr. Molyneaux Chief Medical Officer and Executive Director Dr. Evans Chief Scientific Officer and Executive Director Dr. Yang General Manager of a subsidiary of the Company Total	Number of RSUs 118,400 100,000 68,100 43,200 9,300
	339,000

Position held

Name of the
RSU Grantees
with the Company/
relationship with the Group
Dr. Lu
Chairman, Chief Executive
Officer, Executive Director and
substantial shareholder of the
Company
Dr. Dai
Executive Director
Dr. Molyneaux
Chief Medical Officer and
Executive Director
Dr. Evans
Chief Scientific Officer and
Executive Director
Dr. Yang
General Manager of a subsidiary
of the Company
Total

Number
of RSUs
118,400
100,000
68,100
43,200
9,300

339,000

Number of RSUs : 339,000 RSUs, among which 294,200 and 44,800 RSUs are conditionally granted divided into 1st batch and 2nd batch respectively
Total number of new : 339,000 Shares Shares to be issued and allotted of the RSUs granted

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

RSU period : The RSU(s) shall be valid from the Grant Date and shall continue for a period of 10 years from the Grant Date. Vesting schedules : 1st batch 50% of the RSUs granted shall vest on each of the first and second anniversary of the Grant Date respectively

2nd batch

25% of the RSUs granted shall vest on each of the first, second, third and fourth anniversary of the Grant Date respectively

3. Information on the Connected RSU Grantees

As stated in the Letter from the Board, the Connected RSU Grantees are the directors, chief executives and/or substantial shareholder of members of the Group. We have reviewed the background and work experience of the Connected RSU Grantees and noted that their expertise and experience are relevant to the Group’s operations. Details of the Connected RSU Grantees are set out below:

Dr. Lu is the founder, the Chairman of the Board, an executive Director, the President and the Chief Executive Officer of the Group. Dr. Lu joined the Group in March 2007 and has led the Company from an early discovery effort to an siRNA therapeutics product company, with multiple programs currently at clinical stage. Dr. Lu participates in the decision-making on major issues concerning the Company through the Board. Dr. Lu has authored and co-authored more than 50 scientific publications, including a senior author for a research article in Nature Medicine, and is the inventor and/or co-inventor of more than 70 patents.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

As shown above and with reference to the biography of the Connected RSU Grantees detailed in 2021 Annual Report, each of the Connected RSU Grantees has extensive experiences in the biopharmaceutical industry as evidenced by their working experiences, academic background as well as their past contributions to the Group. Each of the Connected RSU Grantees held critical positions in the Group which were essential for the management, operation, research and development of the Group. As stated in the section headed “1. Information on the Group — (i) Business of the Group” above, the product pipelines of the Group are in either clinical or pre-clinical stage with its business priorities on advancing the development of its lead product toward market approvals in a broad range of indications. We consider the extensive experiences and research capabilities of the Connected RSU Grantees are critical for the Group to achieve its business priorities so as to commercialize the Group’s product pipeline, and thereby promote the Group’s success and achieve profit.

4. Reasons for and benefits of the proposed grant of RSUs to the Connected RSU Grantees

As stated in the Letter from the Board, the RSU Scheme form part of the incentive schemes of the Group to help attract and retain talents in demand in the biotechnology industry in both the U.S. and Asia. The Board and the Remuneration Committee consider that the Grants aim to (i) recognize the contributions made to the Group by the Grantees; (ii) encourage, motivate and retain the Grantees, whose contributions are beneficial to the continual operation, development and long-term growth of the Group; and (iii) provide additional incentive for the Grantees to continuously generate new clinical assets and facilitate the commercialization of the Group’s assets in the pipeline, with a view to achieve the objectives of increasing the value of the Group and aligning the interests of the Grantees to the Shareholders through ownership of Shares.

We consider that grant of RSUs would be beneficial in retaining the RSU Grantees and motivating them to achieve the business priorities and promote the research and development of the Group by aligning their interests with the Group with the grant of RSUs.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

As advised by the management of the Group, given the highly competitive industry in which the Group operates, replacing executive officers or key employees in the biopharmaceutical industry may be difficult and may take a prolonged period of time given the limited number of individuals in the industry with the breadth of expertise and experience required to successfully develop, gain regulatory approval of, manufacture and commercialize drug products. Maintaining a stable and experienced management team is therefore critical to the development and expansion of biopharmaceutical companies. In particular, since the lead products of the Group are in clinical stage pursuing toward market approvals in a broad range of indications, any replacement in the key executives may adversely affect the schedule and development progress for commercialization. Given that the RSUs to be granted are subject to the respective vesting periods of at least one year, we consider that such feature is designed to motivate the RSU Grantees’ continuing commitment and contribution towards the development of the Group with their expertise and experience, and thereby promote the development of the Group.

In addition, as the proposed grant of RSUs to the Connected RSU Grantees will be satisfied by the issue and allotment of new Shares, there will not be any actual cash outflow by the Group under the proposed grant of RSUs to the Connected RSU Grantees. Since the Group is yet to recognize any revenue and had been loss making, the grant of RSUs is more desirable than monetary bonuses for achieving the purpose of motivating and retaining the Connected RSU Grantees as the cash resources of the Group would be retained for operations and research and development.

Having considered that (i) the grant of RSUs can retain and motivate the Connected RSU Grantees to make contribution to the Group with the vesting period; (ii) it is a common practice for biopharmaceutical companies listed on the Stock Exchange to adopt restricted share incentive schemes to motivate their directors, senior management and employees as set out in the section headed “5. Assessment of the principal terms of the Connected Grant — (i) Comparable grants” below; and (iii) there will not be any actual cash paid by the Group to the Connected RSU Grantees with the grant of RSUs, we consider that the Connected Grant is conducted in the ordinary and usual course of business of the Group and is in the interests of the Company and the Shareholders as a whole.

5. Assessment of the principal terms of the Connected Grant

(i) Comparable grants

In evaluating the fairness and reasonableness of the terms of the Connected Grant, we have, on a best effort basis, identified an exhaustive list of grant of award shares by biopharmaceutical companies listed on the Stock Exchange during the period from August 25, 2022 to November 24, 2022 (the “ Review Period ”), being three month period immediately prior to the Grant Date. Based

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

on the aforesaid criteria, we identified 14 comparable grants of award shares (the “ Comparable Grants ”). Given (a) the Review Period has reflected the latest market condition, especially the latest COVID-19 outbreak; and (b) a sufficient sample size of 14 Comparable Grants, which is exhaustive based on the criteria above, has been identified during the Review Period for comparison purpose, we consider the Review Period to be adequate, fair and representative.

Shareholders should note that the listed issuers involved in grant of award shares have different market capitalizations, profitability and financial positions as compared to those of the Company and the sizes of the award shares to be granted to the participants under the Comparable Grants vary. However, we still consider the Comparable Grants to be fair and representative in assessing the fairness and reasonableness of the terms of the Connected Grant, after taking into account that (a) both the Connected Grant and the Comparable Grants were announced during similar period and market condition; (b) the Comparable Grants were engaged in similar principal activities as the Company in the biopharmaceutical industry; and (c) a sufficient number of the Comparable Grants has been identified, which could provide a general reference to the terms of grant of award shares.

The following table sets out the details of the Comparable Grants:

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
November 16,	Shanghai Haohai	93 grantees	37.34	Yes	0.21%	50%:	after the expiry of 12
2022	Biological						following the grant da
	Technology Co.,						months
	Ltd. (6826)					50%:	after the expiry of 24
							following the grant da
							months
November 9,	Simcere	19 grantees,	42.63	No	0.14%	(i)	One third of 3,515,000
2022	Pharmaceutical	including 9					to the connected grant
	Group Limited	connected					on November 9, 2023,
	(2096)	persons					2025, respectively; an

0.21% 50%: after the expiry of 12 months following the grant date and up to 24 months
50%: after the expiry of 24 months following the grant date and up to 36 months
0.14% (i) One third of 3,515,000 RSUs granted to the connected grantees shall vest on November 9, 2023, 2024 and 2025, respectively; and
(ii) 35,000 RSUs granted to the connected grantees and 119,000 RSUs granted to the non-connected grantees shall vest on November 9, 2023

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of	Percentage of
					total number
						of award
			Market value		shares to total
			of the awarded			number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement		Vesting/Attribution period
			(HK$ million)
November 1,	TOT BIOPHARM	8 grantees,	19.58	Yes		0.99%	Connected grantee:
2022	International	including 1					35%: the later of 31 March 2023 and the
	Company Limited	connected					date of Pre-IPO R&D Target
	(1875)	person					Fulfilment
							40%: the later of 31 March 2024 and the
							date of Pre-IPO R&D Target
							Fulfilment
							25%: the later of 31 March 2025 and the
							date of Pre-IPO R&D Target
							Fulfilment
							Non-connected grantees:
							20%: the later of 31 March 2023 and the
							date of 2022 Year-end Business Target
							Fulfilment
							20%: the later of 31 March 2024 and the
							date of 2022 Year-end Business Target
							Fulfilment
							30%: the later of 31 March 2025 and the
							date of 2022 Year-end Business Target
							Fulfilment

30%: the later of 31 March 2026 and the date of 2022 Year-end Business Target Fulfilment

October 24, Alphamab Oncology 5 grantees 2.42 No 2022 (9966)

0.05% (i) as to approximately 87.1% of the award shares on 24 October 2022;
(ii) as to approximately 2.6% of the award shares on 24 October 2023;
(iii) as to approximately 2.6% of the award shares on 24 October 2024;
(iv) as to approximately 2.6% of the award shares on 24 October 2025; and
(v) as to approximately 5.1% of the award shares on 24 October 2026

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
October 16,	RemeGen Co., Ltd.	188 grantees,	14.32	Yes	0.66%	Class A interests:
2022	(9995)	including 6				20%: after the expiry of 12 months
		connected					following the grant date and up to 24
		persons					months
						20%: after the expiry of 24 months
							following the grant date and up to 36
							months
						20%: after the expiry of 36 months
							following the grant date and up to 48
							months
						20%: after the expiry of 48 months
							following the grant date and up to 60
							months
						20%: after the expiry of 60 months
							following the grant date and up to 72
							months
						Class B interests:
						20%: after the expiry of 24 months
							following the grant date and up to 36
							months
						40%: after the expiry of 36 months
							following the grant date and up to 48
							months
						20%: after the expiry of 48 months
							following the grant date and up to 60
							months
						20%: after the expiry of 60 months
							following the grant date and up to 72
							months
October 9, 2022	KINTOR	16 grantees	12.81	No	0.28%	(i)	as to 50% of the Awards on 31 March
	PHARMACEUTICAL						2024 or 30 September 2024;
	LIMITED (9939)					(ii)	as to 25% of the Awards on 31 March
							2025 or 30 September 2025; and
						(iii)	as to the remaining 25% of the
							Awards on 31 March 2026 or 30
							September 2026.
September 28,	Simcere	212 grantees	97.37	No	0.51%	(i)	One third of 13,881,000 RSUs granted
2022	Pharmaceutical						to the Grantees shall vest on September
	Group Limited						28, 2023, 2024 and 2025, respectively;
	(2096)					(ii)	One third of 528,000 RSUs granted to
							the Grantees shall vest on May 11,
							2023, 2024 and 2025, respectively; and

(iii)One half of 80,000 RSUs granted to the Grantees shall vest on May 11, 2023 and 2024.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
September 22,	Antengene	370 grantees,	62.08	Yes	2.10%	Grantees who joined the Gr
2022	Corporation	including 7				on	the date of Listing:
	Limited (6996)	connected				(i)	25% of the Awarded S
		persons					RSUs shall be vested

2.10% Grantees who joined the Group prior to or on the date of Listing:
(i) 25% of the Awarded Shares under the RSUs shall be vested immediately on the Grant Date;
(ii) 25% of the Awarded Shares under the RSUs shall be vested on the first anniversary of the Grant Date;
(iii) 16.6% of the Awarded Shares under the RSUs shall be vested on the second anniversary of the Grant Date;
(iv) 16.7% of the Awarded Shares under the RSUs shall be vested on the third anniversary of the Grant Date; and
(v) 16.7% of the Awarded Shares under the RSUs shall be vested on the fourth anniversary of the Grant Date.
Grantees who joined the Group after the Listing:
(i) 25% of the Awarded Shares under the RSUs shall be vested on the first anniversary of the Grant Date;
(ii) 25% of the Awarded Shares under the RSUs shall be vested on the second anniversary of the Grant Date;
(iii) 25% of the Awarded Shares under the RSUs shall be vested on the third anniversary of the Grant Date; and
(iv) 25% of the Awarded Shares under the RSUs shall be vested on the fourth anniversary of the Grant Date.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
September 21,	Brii Biosciences	88 grantees,	37.11	No	0.91%	(i)	in relation to 5,801,000 RSUs: 25%,
2022	Limited (2137)	including 6					25%, 25% and 25% of the grant will
		connected					vest on each of the first, second, third
		persons					and fourth anniversaries of the RSU
							vesting start date of each RSU
							Grantee, respectively;
						(ii)	in relation to 327,000 RSUs:
							one-third, one-third and one-third of
							the grant will vest on each of the
							first, second and third anniversaries of
							the effective date of appointment of
							the relevant RSU Grantee,
							respectively;
						(iii)	in relation to 180,000 RSUs: the grant
							will vest on the first anniversary of
							the Grant Date; and
						(iv)	in relation to 271,000 RSUs: the grant
							shall vest over three years from the
							employment commencement date of
							the RSU Grantees upon the
							achievements by the Group of certain
							program milestones determined by the
							Board which are specified in the
							relevant award agreement entered into
							between the Company and the RSU
							Grantees.
September 19,	Everest Medicines	1 connected	18.32	Partial	0.67%	Award with no performance target: 860,474
2022	Limited (1952)	grantee				shares shall vest on the first anniversary of
						the	date of appointment
						Award with performance target: (i) 50% if
						the	share price first exceeds HK$55; and
						(ii)	50% if the share price first exceeds
						HK$75
September 19,	WuXi AppTec Co.,	30 grantees	15.25	Yes	0.04%	(i)	25% on the first trading day
2022	Ltd.						immediately following the second
	(2359)						anniversary of the commencement

0.04% (i) 25% on the first trading day immediately following the second anniversary of the commencement date of the employment of the grantee;
(ii) 25% on the first trading day immediately following the third anniversary of the commencement date of the employment of the grantee; and
(iii) 25% on the first trading day immediately following the fourth anniversary of the commencement date of the employment of the grantee.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
September 9,	Ocumension	300 grantees,	160.11	Partial	2.26%	Non-connected grantees and
2022	Therapeutics	including				connected grantee:
	(1477)	2 connected				(i)	10% of the Awards sh
		persons					first anniversary of th

2.26% Non-connected grantees and one of the connected grantee:
(i) 10% of the Awards shall vest on the first anniversary of the Grant Date;
(ii) 20% of the Awards shall vest in four equal instalment during the period from the first anniversary of the Grant Date to the second anniversary of the Grant Date;
(iii) 30% of the Awards shall vest in four equal instalments during the period from the second anniversary of the Grant Date to the third anniversary of the Grant Date; and
(iv) 40% of the Awards shall vest in four equal instalments during the period from the third anniversary of the Grant Date to the fourth anniversary of the Grant Date.
The other connected grantee:
(i) 25% of the Awards shall vest immediately on the Grant Date;
(ii) 25% of the Awards shall vest on the first anniversary of the Grant Date, conditional upon the achievement of certain performance targets;
(iii) 25% of the Awards shall vest on the second anniversary of the Grant Date, conditional upon the performance targets to be achieved; and
(iv) 25% of the Awards shall vest on the third anniversary of the Grant Date, conditional upon the performance targets to be achieved.

September	2,	Genscript Biotech	Undisclosed	6.05 No	0.01%	the RSA Shares will be vested in two or
2022		Corporation				three batches, and that the last batch of the
		(1548)				RSA Shares will be vested on 2 September
						2025
September	1,	RemeGen Co., Ltd	1 connected	3.08 Yes	0.01%	25% each year over the four years since the
2022		(9995)	grantee			date of grant of the Award Shares
			Maximum	160.11	2.26%
			Minimum	2.42	0.01%
			Average	37.75	0.63%
			Median	18.95	0.39%

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

					Percentage of
					total number
					of award
			Market value		shares to total
			of the awarded		number of
			shares on the		shares in issue
Date of	Company name	Number of	date of grant/	Vesting	on the date of
announcement	(stock code)	grantee(s)	announcement	conditions	announcement	Vesting/Attribution period
			(HK$ million)
November 24,	The Company	119 RSU	52.84	No	1.03%	(i)	50% of the RSUs granted under the
2022		Grantees,	(Connected		(Connected		1st batch shall vest on each of the
		including 5	Grant:		Grant:		first and second anniversary of the
		Connected	19.83)		0.39%)		Grant Date respectively; and
		RSU				(ii)	25% of the RSUs granted under the
		Grantees					2nd batch shall vest on each of the
							first, second, third and fourth
							anniversary of the Grant Date
							respectively

Source: the announcements of the respective companies published on the website of the Stock Exchange

Vesting period

Under the Connected Grant, (i) 50% of the RSUs granted under the 1st batch shall vest on each of the first and second anniversary of the Grant Date respectively; and (ii) 25% of the RSUs granted under the 2nd batch shall vest on each of the first, second, third and fourth anniversary of the Grant Date respectively. As shown in the above, the Comparable Grants had vesting period ranged from immediate vesting up to approximately five years from the date of grant, and generally vested on two to five batches over the period. The vesting period of the Connected Grant falls within the range of the Comparable Grants and hence is in line with the market practice.

Number of RSUs to be granted to the Grantees

We note that the percentage of total number of award shares to total number of shares in issue on the date of announcement of the Comparable Grants ranges from approximately 0.01% to 2.26%, with the average of approximately 0.63%. The RSUs to be granted under the Connected Grant and the total number of RSUs to be granted under the RSU Grant (including the Connected Grant) represent approximately 0.39% and 1.03% of the issued share capital of the Company as at the Latest Practicable Date. Accordingly, both such figures fall within the range of the Comparable Grants with the percentage of the Connected Shares falling below the average figure of the Comparable Grants.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

Meanwhile, the market value of the award shares of the Comparable Grants ranges from HK$2.42 million to approximately HK$160.11 million with the average being approximately HK$37.75 million. The market value of the Connected Grant and the RSU Grant (including the Connected Grant) of approximately HK$19.83 million and HK$52.84 million respectively therefore also falls within the range of the Comparable Grants.

Vesting condition

As shown in the table above, eight out of the 14 Comparable Grants either do not have vesting condition or only have vesting condition on part of the award shares, which indicated that the lack of vesting condition under the grant of restricted shares is not uncommon in the market. We noted from the announcements of these Comparable Grants which do not have vesting condition that the purposes of the grant of award shares are to, among others, recognize and reward the Grantees for their past contributions, as well as to secure their long-term support of the Group. In light of the above, although the Connected Grant do not have performance targets as vesting condition, given one of the purposes of the RSU Grant is also to recognize the Grantees’ past contributions to the Group and served as a discretionary bonus, we consider that the absence of vesting condition to be acceptable.

(ii) Comparison of remuneration packages

(a) Remuneration packages of the Connected RSU Grantees

The table below set out a breakdown of the total remuneration packages of the Connected RSU Grantees for FY2021 based on the 2021 Annual Report and information provided by the Company, and the hypothetical total remuneration after including the market value of the RSUs:

Name of the RSU Grantees Salaries and other allowances Retirement benefit schemes contributions Share-based payment expenses Performance and discretionary bonus Total remuneration for FY2021 HK$ HK$ HK$ HK$ HK$ (Note 1) (Note 1) (Note 1) (Note 1) (Note 1) Dr. Lu 2,948,620 140,040 28,739,320 1,073,640 32,901,620 Dr. Dai — — 4,753,580 — 4,753,580 Dr. Molyneaux 3,096,440 140,040 3,205,360 840,240 7,282,080 Dr. Evans 2,310,660 132,260 3,734,400 536,820 6,714,140 Dr. Yang 1,307,040 85,580 1,275,920 210,060 2,878,600 Total	Total market value of the RSUs HK$ (Note 2) 6,926,400 5,850,000 3,983,850 2,527,200 544,050 19,831,500	Market value of the RSUs on an annual basis Hypothetical total remuneration HK$ HK$ (Note 3) 3,463,200 36,364,820 2,925,000 7,678,580 1,991,925 9,274,005 1,263,600 7,977,740 272,025 3,150,625 9,915,750 64,445,770	Market value of the RSUs on an annual basis Hypothetical total remuneration HK$ HK$ (Note 3) 3,463,200 36,364,820 2,925,000 7,678,580 1,991,925 9,274,005 1,263,600 7,977,740 272,025 3,150,625 9,915,750 64,445,770
			64,445,770

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

Notes:

The emoluments were extracted from the 2021 Annual Report and translated with the exchange rate of US$1:HK$7.78.
The market price is based on the closing price of HK$58.5 per Share on the Grant Date.
Since the majority of the RSUs will be granted under the first batch which will be vested in the first and second anniversary of the grant date, the annual value of the RSUs is assumed to be 50% of the total value of the RSUs.
(b) Remuneration packages of executive directors of comparable companies

Many biotech companies (including the Company) were or are listed on the Stock Exchange under Chapter 18A of the Listing Rules (the “ 18A Companies ”). As at November 24, 2022 (being the date on which the Board approved the RSU Grant) (the “ Last Trading Day ”), the market capitalization of the Company was approximately HK$5.1 billion. We have, based on our search on the website of the Stock Exchange, identified an exhaustive list of biotech companies which (1) were or are listed on the Stock Exchange under Chapter 18A of the Listing Rules prior to 2022; and (2) have a market capitalization that falls within a range of 50% to 150% of that of the Company (i.e. HK$2.6 billion to HK$7.7 billion) (the “ Comparable Company(ies) ”) on the Last Trading Day.

Based on the aforesaid criteria, we have identified an exhaustive list of 17 Comparable Companies and we consider the Comparable Companies to be fair and representative. Given Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans are executive Directors, we have compared their remuneration packages with those of the executive directors of the Comparable Companies for FY2021. We consider the aforesaid criteria allow us to identify other 18A companies with market capitalization comparable to that of the Company and can provide a sufficient sample size for comparison purpose.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

Set out below is a summary of the remuneration packages of the executive directors of the Comparable Companies for FY2021:

							Percentage of
							average amount of
		Market		Range of total	Average	Average	share-based payment
		Capitalization	Number of	remunerations of	remunerations	amount of	to average
		on the Last	executive	executive directors	of executive	share-based	remunerations of
Company	Stock Code	Trading Day	directors	(Note 1)	directors	payment	executive directors
		HK$’ million		HK$’ 000	HK$’ 000	HK$’ 000
Ascletis Pharma Inc.	1672	3,533	2	2,754 to 21,935	12,345	no information	N/A
Zylox-Tonbridge Medical
Technology Co., Ltd.	2190	3,357	3	6,782 to 17,812	11,280	7,655	67.9%
Everest Medicines Limited
(Note 2)	1952	3,108	4	20,084 to 72,779	38,231	23,872	62.4%
Hua Medicine	2552	2,892	2	7,795 to 26,242	17,018	8,641	50.8%
Acotec Scientific Holdings
Limited	6669	3,197	2	1,819 to 5,198	3,508	none	N/A
Clover Biopharmaceuticals,
Ltd.	2197	6,633	2	8,104 to 16,119	12,112	6,003	49.6%
Jacobio Pharmaceuticals
Group Co., Ltd.	1167	3,379	3	3,286 to 4,928	3,941.3	1,587	40.3%
CStone Pharmaceuticals	2616	3,978	1	131,474	131,474	124,594	94.8%
Kintor Pharmaceutical Limited	9939	5,053	1	6,419	6,419	none	N/A
Venus MedTech (HangZhou)
Inc.	2500	5,204	3	968 to 1,513	1,207	none	N/A
Brii Biosciences Limited	2137	5,932	2	27,474 to 71,895	49,684	24,025	48.4%
Ocumension Therapeutics	1477	5,337	2	7,349 to 137,154	72,251	68,416	94.7%
Peijia Medical Limited	9996	5,257	3	195 to 3,328	1,958	1,150	58.7%
MicroPort CardioFlow
Medtech Corporation	2160	5,898	3	3,300 to 4,171	9,045	1,814	20.1%
Ascentage Pharma Group
International	6855	4,209	1	5,225	5,225	no information	N/A
CARsgen Therapeutics
Holdings Limited	2171	7,384	2	1,718 to 2,368	2,043	no information	N/A
Alphamab Oncology	9966	7,706	2	3,268 to 7,385	5,327	no information	N/A
				Maximum	131,474	124,594	94.8%
				Minimum	1,207	1,150	20.1%
				Average	22,533	26,776	58.7%
				Median	9,045	8,148	54.7%
The Company	2257	5,146	4	7,679 to 36,365	15,324	12,519	81.7%
					(Note 3)	(Note 4)

Source: Annual reports of the Comparable Companies

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

Notes:

Calculated based on the exchange rate of RMB1: HK$1.1.
One of the executive directors of Everest Medicines Limited did not receive any remuneration for FY2021 and was excluded from calculation.
Represented the hypothetical total remuneration of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans after including the value of the RSUs of the Connected RSU Grantees, which are calculated on the basis set out in the section headed “5. Assessment of the principal terms of the Connected Grant — (ii) Comparison of remuneration packages — (a) Remuneration packages of the Connected RSU Grantees” above.
Represented the average of the sum of the share-based payment of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans for FY2021 and the market value of the RSUs granted on annual basis, which are calculated on the basis set out in the section headed “5. Assessment of the principal terms of the Connected Grant — (ii) Comparison of remuneration packages — (a) Remuneration packages of the Connected RSU Grantees” above.

As shown in the table above, the total remunerations of the executive directors of the Comparable Companies, which primarily included salaries and other allowances, performance-related bonus, retirement benefit scheme contributions and share-based payment expenses, ranged from approximately HK$195,000 to approximately HK$137.2 million for FY 2021. Although the range is wide, we still consider the analysis on the remuneration packages of the executive directors of the Comparable Companies to be meaningful and necessary in assessing the fairness and reasonableness of the remuneration packages of the Connected RSU Grantees given that (1) the remuneration packages of the Connected RSU Grantees are estimated with reference to, among others, the remuneration level of the industry as advised by the management of the Company; and (2) the remuneration packages of the executive directors of the Comparable Companies could provide a general reference to the remuneration level of the industry.

As shown in the table above, the average remunerations of the executive directors of the Comparable Companies ranged from approximately HK$1.2 million to approximately HK$131.5 million with an average of approximately HK$22.5 million (the “ Average Remuneration ”) and a median of approximately HK$9.0 million (the “ Median Remuneration ”). The annual remuneration of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans which ranged from approximately HK$7.7 million to approximately HK$36.4 million are within the range of the Comparable Companies. The average remuneration of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans of approximately HK$15.3 million is higher than the Median Remuneration but lower than the Average Remuneration. In addition, the percentage of the average amount of share-based payment to average remunerations of executive directors of the Comparable Companies ranged from approximately 20.1% to approximately 94.8% with an average of approximately 58.7% (the “ Average Percentage ”) and a median of approximately 54.7% (the “ Median Percentage ”). The percentage of the average amount of share-based payment to average remunerations of executive directors of the Company of approximately 81.7% is hence within the range of the Comparable Companies and higher than the Average Percentage and Median Percentage. Given the above, we

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

consider that the hypothetical total remuneration of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evans after adding the value of the RSUs and the percentage of share-based payment to total remuneration ratio are in line with those of the Comparable Companies.

Since there are no public information on the remuneration of directors in the subsidiary level, the remuneration package of Dr. Yang could not be directly compared to the Comparable Companies. Nevertheless, we were advised by the management of the Group that number and value of RSUs proposed to be granted to each of the Connected RSU Grantees were under the same basis with reference to, among other things, their respective roles, responsibilities, work experience, contributions and remuneration packages, as well as the market value of the RSUs. In addition, based on the hypothetical remuneration of Dr. Yang as set out in the section headed “(a) Remuneration packages of the Connected RSU Grantees” above, the percentage of the amount of share-based payment to his hypothetical remuneration is approximately 49.1%, which is within the range and lower than the average and median the Comparable Companies. Given the hypothetical total remuneration of Dr. Lu, Dr. Dai, Dr. Molyneaux and Dr. Evan are in line with the market and the share-based payment to remuneration ratio of Dr. Yang is lower than all of the Comparable Companies, we consider the number of RSUs to be granted to the Connected RSU Grantees under the Connected Grant is fair and reasonable.

(iii) Overall comment

Having considered (a) the vesting period of the Connected Grant is generally in line with the market; (b) it is not uncommon among the Comparable Grants to grant award shares without vesting condition; (c) the Connected Grant and the RSU Grant represented approximately 0.39% and 1.03% of the issued share capital of the Company as at the Latest Practicable Date which are within the range of the Comparable Grant; and (d) the hypothetical total remuneration of the executive Directors are in line with those of the Comparable Companies, which indicated that the number of RSUs to be granted to the Connected RSU Grantees under the Connected Grant is not excessive, we consider the terms of the Connected Grant to be fair and reasonable.

6. Possible effect on the shareholding interests of the existing public Shareholders

As aforementioned, the 903,200 RSUs and 339,000 RSUs to be granted under the RSU Grant and the Connected Grant represent approximately 1.03% and 0.39% of the issued share capital of the Company as at the Latest Practicable Date, respectively. With the above being the case, the possible dilution to the shareholding interests of the existing public Shareholders attributable to the issue and allotment of the new Shares under the RSU Scheme would likely to be minimal.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

In light of that (i) the possible dilution to the shareholding interests of the existing public Shareholders would likely to be minimal; (ii) the reasons for and benefits of the proposed grant of RSUs to the Connected RSU Grantees as set out in this letter; and (iii) the terms of the Connected Grant to be fair and reasonable, and the Connected Grant is in the interests of the Company and the Shareholders as a whole, we concur with the Directors that the said possible dilution in shareholdings is acceptable.

7. Financial effect of the grant of RSUs

As advised by the management of the Group, save for the expenses relating to the issue and allotment of the RSUs, the grant of the RSUs will not have any material impact on the Group’s cash position and net current assets. Under the accounting policies of the Group, the share-based payment expense arising from the RSU Grant will be amortized to the Group’s consolidated statement of profit or loss throughout the vesting period (i.e. from the date of grant to the vesting date (both dates inclusive)).

OPINION AND RECOMMENDATION

Taking into account the above principal factors and reasons, we consider that the terms of the Connected Grant are on normal commercial terms which are fair and reasonable so far as the Independent Shareholders are concerned. We also consider that the Connected Grant is conducted in the ordinary and usual course of business of the Group and in the interest of the Company and the Shareholders as a whole. We therefore advise the Independent Board Committee to recommend, and ourselves recommend, the Independent Shareholders to vote in favor of the resolutions to be proposed at the EGM to approve the Connected Grant.

Yours faithfully, For and on behalf of Rainbow Capital (HK) Limited Danny Leung Managing Director

Mr. Danny Leung is a licensed person and a responsible officer of Rainbow Capital (HK) Limited registered with the Securities and Futures Commission to carry out type 1 (dealing in securities) and type 6 (advising on corporate finance) regulated activities under the SFO. He has over ten years of experience in the corporate finance industry.

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

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

2. DISCLOSURE OF INTERESTS OF DIRECTORS

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the Shares, underlying Shares and debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) as recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules, were as follows:

Long and short positions in Shares, underlying Shares and debentures of the Company:

			Approximate	Approximate
Name of Director or		Number of Shares/	percentage	of interest
chief executive	Capacity/Nature of interest	underlying Shares	in the Company (1)
Dr. Lu	Beneficial interest; Settlor of a discretional	13,237,075 (L)		15.08%
	trust (2)
Dr. Dai	Beneficial interest; Interests in controlled	8,545,007 (L)		9.73%
	corporations (3)
Dr. Molyneaux	Beneficial interest (4)	1,677,450 (L)		1.91%
Dr. Evans	Beneficial interest; Interest held jointly with	1,160,788 (L)		1.32%
	another person (5)
Mr. Mincong Huang	Beneficial interest; Beneficiary of a trust (6)	757,551 (L)		0.86%

Notes:

(L) denotes long position.

(1) As at the Latest Practicable Date, total number of Shares in issue was 87,795,080 Shares.

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APPENDIX

GENERAL INFORMATION

(2) Dr. Lu is the settlor of The Yang Lu Family Trust and the beneficiaries of The Yang Lu Family Trust are Zheng Joan Wang and Laura Yao Lu, being Dr. Lu’s spouse and daughter, respectively. Zheng Joan Wang and Laura Yao Lu are co-trustees of The Yang Lu Family Trust. Therefore, Dr. Lu is deemed to be interested in the 2,500,000 Shares held by The Yang Lu Family Trust. Under the SFO, the deemed interest of Dr. Lu consists of: (i) 2,500,000 Shares held by The Yang Lu Family Trust, (ii) 8,475,075 Shares held by Dr. Lu himself, (iii) options granted to Dr. Lu to subscribe for 1,925,000 Shares under the Pre-IPO Equity Incentive Plan, (iv) the 218,600 Share Options proposed to grant to him to subscribe for 218,600 Shares under the Share Option Scheme, subject to vesting conditions, and (v) the 118,400 Shares underlying the 118,400 RSUs proposed to grant to him under the RSU Scheme, subject to vesting conditions.
(3) Value Measure Investments Limited and Trinity Power Limited are wholly-owned by Dr. Dai. Under the SFO, Dr. Dai is deemed to be interested in 7,850,007 Shares held by Value Measure Investments Limited and Trinity Power Limited. Dr. Dai is also interested in: (i) options granted to him to subscribe for 450,000 Shares under the Pre-IPO Equity Incentive Plan; (ii) the 145,000 Share Options granted to him to subscribe for 145,000 Shares under the Share Option Scheme, subject to vesting conditions, and (iii) the 100,000 Shares underlying the 100,000 RSUs proposed to grant to him under the RSU Scheme, subject to vesting conditions.
(4) Dr. Molyneaux is interested in: (i) options granted to him to subscribe for 1,510,000 Shares under the Pre-IPO Equity Incentive Plan; (ii) the 99,350 Share Options granted to him to subscribe for 99,350 Shares under the Share Option Scheme, subject to vesting conditions, and (iii) the 68,100 Shares underlying the 68,100 RSUs proposed to grant to him under the RSU Scheme, subject to vesting conditions.
(5) Dr. Evans is interested in: (i) options granted to him to subscribe for 965,000 Shares under the Pre-IPO Equity Incentive Plan; (ii) 91,538 Shares jointly held by him and his spouse, Julee Ann Evans; (iii) the 61,050 Share Options granted to him to subscribe for 61,050 Shares under the Share Option Scheme, subject to vesting conditions, and (iv) the 43,200 Shares underlying the 43,200 RSUs proposed to grant to him under the RSU Scheme, subject to vesting conditions.
(6) Soaring Star Ventures Limited owns 600,601 Shares. The Huang Family Trust is the beneficiary of Soaring Star Ventures Limited and Mr. Mincong Huang is the beneficiary of the Huang Family Trust. Mr. Mincong Huang also owns 156,950 Shares. Accordingly, Mr. Mincong Huang is deemed to be interested in 757,551 Shares.

As at the Latest Practicable Date, save as disclosed above, none of the Directors nor chief executive of the Company had any interests or short positions in any Shares, underlying Shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which would have to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and shorts position which the directors and chief executive were deemed or taken to have under provisions of the SFO), or which were required to be and are recorded in the register required to be kept by the Company pursuant to section 352 of the SFO, or which were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules.

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GENERAL INFORMATION

APPENDIX

3. OTHER INTERESTS OF DIRECTORS

(a) As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any assets which had been, since December 31, 2021, being the date to which the latest published audited consolidated financial statements of the Company were made up, acquired or disposed of by or leased to, or which were proposed to be acquired or disposed of by, or leased to, any member of the Group.
(b) None of the Directors was materially interested in any contract or arrangement subsisting as at the Latest Practicable Date and which was significant in relation to the business of the Group.
(c) As at the Latest Practicable Date, none of the Directors or chief executive of the Company and their respective close associates (as defined in the Listing Rules) had any competing interests which would be required to be disclosed under Rule 8.10 of the Listing Rules as if each of them was a controlling Shareholder.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which is not determinable by the Group within one year without payment of compensation (other than statutory compensation).

5. DISCLOSURE OF INTERESTS OF SUBSTANTIAL SHAREHOLDERS

Long and short positions in Shares, underlying Shares and debentures of the Company

So far as is known to any Directors or chief executive of the Company, as at the Latest Practicable Date, other than the interests and short positions of the Directors or chief executive of the Company as disclosed in the section “Long and short positions in Shares, underlying Shares and debentures of the Company” above, the following person had interests or short positions in the Shares or underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under Section 336 of the SFO, or as otherwise notified to the Company and the Stock Exchange:

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GENERAL INFORMATION

APPENDIX

			Approximate
			percentage of
Names of Substantial Shareholders	Capacity/Nature of interest	Number of Shares	shareholding interest
		(Note 1)	(Note 2)
Yu ZENG	Interest in a controlled corporation (3)	4,564,495 (L)	5.20%
Xialing YAN	Interest of spouse (4)	4,564,495 (L)	5.20%
Shenzhen Qianhai Rotating Boulder	Interest in controlled corporations (3)	4,564,495 (L)	5.20%
Fund Management Co., Ltd.
(“Rotating Boulder Fund”)
Shenzhen Rotating Boulder	Interest in a controlled corporation (3)	4,564,495 (L)	5.20%
Tiancheng The Second Investment
Partnership (Limited Partnership)
(“Tiancheng The Second”)
Shenzhen Rotating Boulder	Interest in a controlled corporation (3)	4,564,495 (L)	5.20%
Tiancheng The Third Investment
Partnership (Limited Partnership)
(“Tiancheng The Third”)
Shanghai Chongshi Enterprise	Beneficial interest (3)	4,564,495 (L)	5.20%
Management Partnership (LP)
(“Shanghai Chongshi”)

Notes:

(1) The letter “L” denotes the person’s long position in the Share.
(2) As at the Latest Practicable Date, total number of Shares in issue was 87,795,080 Shares.
(3) Each of Rotating Boulder Fund (as general partner of Shanghai Chongshi), Tiancheng The Third (as a limited partner holding approximately 47.50% in Shanghai Chongshi), Tiancheng The Second (as a limited partner holding approximately 64.36% in Tiancheng The Third), and Yu ZENG (as the controlling shareholder of Rotating Boulder Fund) is deemed to be interested in the Shares held by Shanghai Chongshi under the SFO.
(4) Xialing YAN is the spouse of Yu ZENG, and was therefore deemed to be interested in the Shares in which Yu ZENG was interested under the SFO.

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GENERAL INFORMATION

APPENDIX

Save as disclosed above, as at the Latest Practicable Date, there was no other person (other than the Directors or chief executive of the Company) who had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under Section 336 of the SFO, or as otherwise notified to the Company and the Stock Exchange.

6. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors confirmed that there was not any material adverse change in the financial or trading position of the Group since December 31, 2021, the date to which the latest published audited consolidated financial statements of the Company were made up.

7. MATERIAL LITIGATION

No member of the Group was engaged in any litigation or claims of material importance, and no such litigation or claim of material importance was known to the Directors to be pending or threatened by or against any members of the Group, as at the Latest Practicable Date.

8. EXPERTS AND CONSENTS

The following are the qualifications of the experts who have given opinion or advice, which are contained or referred to in this circular:

Name Qualifications

Opus Capital A corporation licensed to carry out Type 6 (advising on corporate Limited finance) regulated activity under the SFO, being the financial advisor to the Company Rainbow Capital A corporation licensed to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities under the SFO, being the Independent Financial Advisor

As at the Latest Practicable Date, each of Opus Capital Limited and Rainbow Capital did not have (i) any shareholding in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group and (ii) any direct or indirect interest in any assets which had, since December 31, 2021

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GENERAL INFORMATION

APPENDIX

(being the date to which the latest published audited consolidated financial statements of the Company were made up), been acquired or disposed of by, or leased to any member of the Group, or are proposed to be acquired or disposed of by, or leased to any member of the Group.

Each of Opus Capital Limited and Rainbow Capital has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its letter as of the date of this circular and references to its name in the form and context in which it appears.

9. GENERAL

(a) The authorized share capital of the Company is US$230,000.
(b) The principal share registrar and transfer agent of the Company is Maples Fund Services (Cayman) Limited at PO Box 1093, Boundary Hall, Cricket Square, Grand Cayman KY1-1102, Cayman Islands.
(c) The Hong Kong branch share registrar and transfer office of the Company is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.
(d) The joint company secretaries of the Company are Ms. Yun Zhang and Mr. Leung Ting Cheung.
(e) In the event of any inconsistency, the English language text of this circular shall prevail over the Chinese language text.

10. DOCUMENTS ON DISPLAY

The following documents will be published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.sirnaomics.com) for 14 days from the date of this circular:

(a) the letter from the Independent Board Committee, the text of which is set out in this circular;
(b) the letter from the Independent Financial Advisor to the Independent Board Committee and the Independent Shareholders, the text of which is set out in this circular;
(c) a copy of the Share Option Scheme;

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GENERAL INFORMATION

APPENDIX

(d) a copy of the RSU Scheme; and
(e) this circular.

– 55 –

NOTICE OF EXTRAORDINARY GENERAL MEETING

==> picture [25 x 26] intentionally omitted <==

Advancing RNAi Therapeutics

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting of Sirnaomics Ltd. (the “ Company ”) will be held at 10:00 a.m. on Friday, February 3, 2023 at 16/F, Tower 5, The Gateway, Harbour City, 15 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong for the purposes of considering and, if thought fit, passing with or without modifications, the following resolutions as ordinary resolutions.

Unless otherwise specified, capitalized terms used in this notice and the following resolutions shall have the same meanings as those defined in the circular of the Company dated January 18, 2023 (the “ Circular ”).

Ordinary Resolutions

To consider and, if thought fit, pass, with or without amendments, the following resolutions as ordinary resolutions:

“ That :

(1) the grant of 218,600 Share Options pursuant to the Share Option Scheme to Dr. Lu be and is hereby approved and confirmed.
(2) the grant of 118,400 RSUs pursuant to the RSU Scheme to Dr. Lu be and is hereby approved and confirmed.
(3) the grant of 100,000 RSUs pursuant to the RSU Scheme to Dr. Dai be and is hereby approved and confirmed.
(4) the grant of 68,100 RSUs pursuant to the RSU Scheme to Dr. Molyneaux be and is hereby approved and confirmed.
(5) the grant of 43,200 RSUs pursuant to the RSU Scheme to Dr. Evans be and is hereby approved and confirmed.

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NOTICE OF EXTRAORDINARY GENERAL MEETING

(6) the grant of 9,300 RSUs pursuant to the RSU Scheme to Dr. Yang be and is hereby approved and confirmed.”

By order of the Board Sirnaomics Ltd. Yang (Patrick) Lu

Chairman and Executive Director

Hong Kong, January 18, 2023

Registered office:

PO Box 309, Ugland House Grand Cayman, KY1-1104 Cayman Islands

Principal place of business in Hong Kong:

46/F, Hopewell Centre 183 Queen’s Road East Wanchai Hong Kong

Notes:

For the purpose of determining the identity of the Shareholders entitled to attend and vote at the meeting, the register of members of the Company will be closed from Tuesday, January 31, 2023 to Friday, February 3, 2023 (both dates inclusive), during which period no transfer of shares will be effected. All transfers accompanied by the relevant certificates must be lodged with the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712−1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong for registration not later than 4:30 p.m. on January 30, 2023.
A Shareholder entitled to attend and vote at the meeting is entitled to appoint one or, if he/she/it is the holder of two or more Shares, more proxies to attend and vote instead of him/her/it. A proxy need not be a Shareholder. If more than one proxy is so appointed, the appointment shall specify the number and class of Shares in respect of which each such proxy is so appointed. The Company strongly recommends you to monitor the development of the situation with COVID-19 and to assess, based on the social distancing policies, the necessity for attending the above meeting in person, and the Board respectfully requests that, for the same reason, the Shareholders to appoint the chairman of the above meeting as their proxy rather than a third party to attend and vote on their behalf at the above meeting (or any adjournment thereof).
In the case of joint Shareholders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the vote(s) of the other joint Shareholder(s), seniority being determined by the order in which names stand in the register of members of the Company.

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NOTICE OF EXTRAORDINARY GENERAL MEETING

In order to be valid, the form of proxy must be in writing under the hand of the appointor or of his/her/its attorney duly authorized in writing, or if the appointor is a corporation, either under seal, or under the hand of an officer or attorney or other person duly authorized, and must be deposited with the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong (together with the power of attorney or other authority, if any, under which it is signed or a certified copy thereof) not less than 48 hours before the time fixed for holding of the meeting. The completion and return of the form of proxy shall not preclude Shareholders from attending and voting in person at the above meeting (or any adjourned meeting thereof) if they so wish.
Pursuant to Rule 13.39(4) of the Listing Rules, voting for all the resolutions set out in this notice will be taken by poll at the above meeting. On a poll, votes may be given either personally or by proxy.
Subject to the development of COVID-19, the Company may implement further changes and precautionary measures and may issue further announcement(s) on such measures as appropriate.

Online participation

In addition to the physical meeting, to facilitate participation in the EGM by the Shareholders who cannot attend the EGM in person, Shareholders or their duly appointed proxies or corporate representatives may view and listen to the EGM through a live webcast of the EGM which can be accessed via https://zoom.us/j/3017401730?pwd=clNzVWNqQVhDcUlvWGdtVHFtL3M2Zz09 on a smartphone, computer, tablet device or other browser enabled device, and submit questions in near real-time through functions to be offered by such online platform. Please follow the instructions on the landing page on how to access the webcast. The online platform will be opened for registered Shareholders and non-registered Shareholders to access approximately 30 minutes prior to the commencement of the EGM. Shareholders will be able to access the live webcast at the beginning of the EGM until its conclusion.
However, if a Shareholder participates in the EGM online only (i.e. neither the Shareholder nor its proxy attends the EGM physically and votes), the Shareholder will not be counted as quorum and his/her/its vote will not be counted. Where the Shareholder will not be attending the EGM in person but wishes to vote, please refer to the vote by proxy arrangement referred to above.

As at the date of this notice, the Board comprises Dr. Yang Lu (alias Patrick Lu), Dr. Michael V. Molyneaux, Dr. David Mark Evans and Dr. Xiaochang Dai as executive Directors, Mr. Mincong Huang and Mr. Jiankang Zhang as non-executive Directors, and Dr. Cheung Hoi Yu, Mr. Fengmao Hua, Ms. Monin Ung and Ms. Shing Mo Han, Yvonne (alias Mrs. Yvonne Law) as independent non-executive Directors.

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AI assistant

Sirnaomics Ltd. — Proxy Solicitation & Information Statement 2023

50478_rns_2023-01-17_48468a7c-8f50-46f9-92d4-cf52c7fd57ab.pdf

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

(1) PROPOSED GRANT OF SHARE OPTIONS TO A DIRECTOR; (2) CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS; AND (3) NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent Financial Advisor to the Independent Board Committee and the Independent Shareholders

PRECAUTIONARY MEASURES FOR THE EGM

CONTENTS

Online participation

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

Advancing RNAi Therapeutics

Sirnaomics Ltd.

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 2257)

(1) PROPOSED GRANT OF SHARE OPTIONS TO A DIRECTOR; AND (2) CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

INTRODUCTION

(1) PROPOSED GRANT OF SHARE OPTIONS TO DR. LU

LETTER FROM THE BOARD

Option period:

1st batch

2nd batch

Performance target:

LETTER FROM THE BOARD

Effects on shareholding structure of the Company

LETTER FROM THE BOARD

LETTER FROM THE BOARD

Listing Rules Implications

LETTER FROM THE BOARD

(2) PROPOSED GRANT OF RSUs TO THE CONNECTED RSU GRANTEES

LETTER FROM THE BOARD

LETTER FROM THE BOARD

1st batch

2nd batch

Effects on shareholding structure of the Company

LETTER FROM THE BOARD

Listing Rules Implications

LETTER FROM THE BOARD

LETTER FROM THE BOARD

REASONS FOR AND BENEFITS OF THE PROPOSED GRANT OF SHARE OPTIONS TO DR. LU AND THE PROPOSED GRANT OF RSUs TO THE CONNECTED RSU GRANTEES

LETTER FROM THE BOARD

LETTER FROM THE BOARD

NOTICE OF THE EGM

FORM OF PROXY

EGM

LETTER FROM THE BOARD

VOTING BY POLL

Online participation

CLOSURE OF REGISTER OF MEMBERS

RECOMMENDATION

GENERAL

Advancing RNAi Therapeutics

Sirnaomics Ltd.

CONNECTED TRANSACTION — PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

Yours faithfully For and on behalf of the Independent Board Committee

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

CONNECTED TRANSACTION PROPOSED GRANT OF RESTRICTED SHARE UNITS TO CONNECTED PERSONS

INTRODUCTION

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

BASIS OF OUR OPINION

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

PRINCIPAL FACTORS AND REASONS CONSIDERED

1. Information on the Group

(i) Business of the Group

(ii) Financial information of the Group

2. Principle terms of the Connected Grant

Position held

2nd batch

3. Information on the Connected RSU Grantees

4. Reasons for and benefits of the proposed grant of RSUs to the Connected RSU Grantees

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

5. Assessment of the principal terms of the Connected Grant

(i) Comparable grants

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

LETTER FROM THE INDEPENDENT FINANCIAL ADVISOR

Sirnaomics Ltd. Proxy Solicitation & Information Statement 2023