TNAG-2755-FCO40-3972-Banking-situation-in-Hong-Kong-1993 — Page 69

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1989 Ed.]

Hang Lung Bank (Compensation of Former Shareholders) Regulations

[CAP. 345

A 7

[Subsidiary]

PART III

PAYMENT OF COMPENSATION

16. Payment of compensation

(1) A former shareholder shall be entitled to be paid compensation equal to the value of one share as calculated by the Tribunal under Part II multiplied by the number of shares held by him immediately before commencement, together with interest on that compensation from commencement until payment at the rate calculated in accordance with subregulation (2).

(2) For the purpose of subregulation (1) simple interest shall be calculated daily during the period referred to in subregulation (1) by applying to that compensation the daily maximum single rate of interest paid on savings accounts denominated in Hong Kong dollars during that period by members of the Hong Kong Association of Banks.

(3) Compensation and interest are charged upon and shall be paid out of money provided by the Legislative Council by the Financial Secretary Incorporated within 30 days of such provision being made. (L.N. 180 of 1985)

SCHEDULE

[reg. 6]

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I. (1) In this Schedule, unless the context otherwise requires—

"company" includes any subsidiary;

means a company continuing to be operated with a view to paying

"company as a going concern"

dividends out of its earnings:

"earnings" means the profit for one year according to the published results of a company after

taxation and after excluding any extraordinary items;

"earnings per share" means earnings divided by the number of shares in issue by a company; "price earnings ratio" means a figure calculated by dividing the current price of a share of a

company by the earnings per share;

"reconstructed company" means the company reconstructed by the payment into shareholders

funds of the company reconstruction costs referred to in paragraph 6;

"shareholders funds' means the net assets of the company calculated in accordance with

subparagraph (2).

(2) Shareholders funds shall be calculated using standard accounting conventions and practices by deducting from the assets of the company-

(a) depreciation;

(b) provisions for bad or doubtful debts calculated in accordance with paragraph 4;

(c) provisions for contingent liabilities;

(d) such other provisions as the Tribunal considers reasonable;

(e) all other liabilities of the company.

2. The value of a single share shall be calculated in accordance with the factors and principles set out in this Schedule and on the basis of the amount that a willing sole purchaser would at commencement in the ordinary course of business have paid a willing seller for all of the shares sold in one block after negotiating at arms length and with full knowledge of the true financial position and value of the company at commencement divided by the total number of shares.