tm212439-1_pre14a - none - 20.2188935s
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.   )
Filed by the Registrant   ☒
Filed by a Party other than the Registrant   ☐
Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a-12
BEIGENE, LTD.
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1)
Title of each class of securities to which transaction applies:
   
(2)
Aggregate number of securities to which transaction applies:
   
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):    
(4)
Proposed maximum aggregate value of transaction:
   
(5)
Total fee paid:
   

Fee paid previously with preliminary materials.

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)
Amount Previously Paid:
   
(2)
Form, Schedule or Registration Statement No.:
   
(3)
Filing Party:
   
(4)
Date Filed:
   

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PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION
This document shall also serve as a circular to holders of the ordinary shares of BeiGene, Ltd. for purposes of the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited (the “HK Listing Rules”)
BEIGENE, LTD.
(NASDAQ Trading Symbol: BGNE; HKEx Stock Code: 06160)
c/o Mourant Governance Services (Cayman) Limited
94 Solaris Avenue, Camana Bay
Grand Cayman KY1-1108
Cayman Islands
NOTICE OF 2021 ANNUAL GENERAL MEETING OF SHAREHOLDERS
Notice is hereby given that the 2021 Annual General Meeting of Shareholders (the “Annual Meeting”) of BeiGene, Ltd. (the “Company”) will be held on June 16, 2021, at 6:00 p.m. local time, at the offices of Mourant Governance Services (Cayman) Limited, at 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands. The purpose of the meeting is to consider and vote on the following:
1.
ordinary resolution: to re-elect Donald W. Glazer to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
2.
ordinary resolution: to re-elect Michael Goller to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
3.
ordinary resolution: to re-elect Thomas Malley to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
4.
ordinary resolution: to re-elect Corazon (Corsee) D. Sanders to serve as a Class II director until the 2024 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal;
5.
ordinary resolution: to approve and ratify the selection of Ernst & Young Hua Ming LLP and Ernst & Young as the Company’s independent registered public accounting firms for the fiscal year ending December 31, 2021;
6.
ordinary resolution: within the parameters of Rule 13.36 of the HK Listing Rules, to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or American Depositary Shares (“ADSs”) not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, subject to the conditions described in this Proxy Statement;
7.
ordinary resolution: to authorize the Company and its underwriters, in their sole discretion, to allocate to each of Baker Bros. Advisors LP and Hillhouse Capital Management, Ltd. and parties affiliated with each of them (the “Existing Shareholders”), up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Existing Shareholders, subject to the conditions described in this Proxy Statement;
8.
ordinary resolution: to authorize the Company and its underwriters, in their sole discretion, to allocate to each of the Existing Shareholders, up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on then-outstanding share
 

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capital of the Company) before and after the proposed issue of shares to be listed on the Science and Technology Innovation Board (the “STAR Market”) of the Shanghai Stock Exchange and to be traded in Renminbi (“RMB”) pursuant to the general mandate to issue shares set forth above, subject to the conditions described in this Proxy Statement;
9.
ordinary resolution: to authorize the Company and its underwriters, in their sole discretion, to allocate to Amgen Inc. (“Amgen”) up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Amgen, subject to the conditions described in this Proxy Statement;
10.
ordinary resolution: to authorize the Company and its underwriters, in their sole discretion, to allocate to Amgen, up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on then-outstanding share capital of the Company) before and after the proposed issue of shares to be listed on the STAR Market and to be traded in RMB pursuant to the general mandate to issue shares set forth above, subject to the conditions described in this Proxy Statement;
11.
ordinary resolution: to approve the grant of an option to acquire shares to Amgen to allow Amgen to subscribe for additional shares under a specific mandate in an amount necessary to enable it to increase (and subsequently maintain) its ownership at approximately 20.6% of the Company’s outstanding share capital, up to an aggregate of 75,000,000 ordinary shares during the option term, pursuant to the terms of the Restated Amendment No. 2 dated September 24, 2020 to the Share Purchase Agreement dated October 31, 2019, as amended, by and between the Company and Amgen;
12.
ordinary resolution: to approve the grant of restricted share units (“RSUs”) with a grant date fair value of US$3,750,000 to Mr. John V. Oyler under the Second Amended and Restated 2016 Share Option and Incentive Plan (as amended, the “2016 Plan”), according to the terms and conditions described in this Proxy Statement;
13.
ordinary resolution: to approve the grant of RSUs with a grant date fair value of US$1,000,000 to Dr. Xiaodong Wang under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
14.
ordinary resolution: to approve the grant of RSUs with a grant date fair value of US$200,000 to each of other non-executive and independent non-executive directors, Mr. Anthony C. Hooper, Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi, under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
15.
ordinary resolution: to approve, on an advisory basis, the compensation of our named executive officers, as disclosed in this Proxy Statement;
16.
special resolution: to adopt the Sixth Amended and Restated Memorandum and Articles of Association of the Company as described in this Proxy Statement;
17.
ordinary resolution: to approve the adjournment of the Annual Meeting by the chairman, if necessary, to solicit additional proxies if there are insufficient votes at the time of the Annual Meeting to approve any of the proposals described above; and
18.
to transact such other business as may properly come before the Annual Meeting.
The proposals for the election of directors relate solely to the election of Class II directors nominated by the Board of Directors. Proposals 6 through 14 are being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
 

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The Board of Directors has fixed 5:00 a.m. Cayman Islands Time / 6:00 a.m. New York Time / 6:00 p.m. Hong Kong Time on April 19, 2021 as the record date. Holders of record of our ordinary shares as of 5:00 a.m. Cayman Islands Time / 6:00 a.m. New York Time / 6:00 p.m. Hong Kong Time on the record date are entitled to attend and vote at the Annual Meeting and any adjournment or postponement. Holders of record of our ADSs, each representing 13 of our ordinary shares, as of the record date who wish to exercise their voting rights for the underlying ordinary shares must act through Citibank, N.A., the depositary of the ADSs.
We intend to hold the Annual Meeting in person at the location specified above. However, we are actively monitoring the coronavirus (“COVID-19”) pandemic and we are sensitive to the public health and travel concerns our shareholders may have and the protocols that national and local governments may impose. In the event that it is not possible or advisable to hold the Annual Meeting in person at the location specified above, we will announce on our Annual Meeting website (www.beigene.com), the website of the U.S. Securities and Exchange Commission (www.sec.gov) and the website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting at an alternative location or by means of remote communication. Please monitor our Annual Meeting website, and the websites of the U.S. Securities and Exchange Commission and Hong Kong Exchanges and Clearing Limited for updated information. If you are planning to attend the Annual Meeting, please check the websites one week prior to the meeting date. As always, we encourage you to vote your shares by proxy or voting instruction prior to the Annual Meeting.
The accompanying Proxy Statement more fully describes the details of the business to be conducted at the Annual Meeting. After careful consideration, the Board of Directors has approved the proposals and recommends that you vote FOR each director nominee and FOR each other proposal described in this Proxy Statement.
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this Proxy Statement, 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 Proxy Statement.
This Proxy Statement, for which the directors collectively and individually accept full responsibility, includes particulars given in compliance with the HK 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 Proxy Statement 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 Proxy Statement misleading.
As of the date of this Proxy Statement, the Board of Directors of the Company comprises Mr. John V. Oyler as Chairman and executive director, Dr. Xiaodong Wang and Mr. Anthony C. Hooper as non-executive directors, and Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi as independent non-executive directors.
Your vote is important. As promptly as possible, you are urged to complete, sign, date and return the accompanying form of proxy to Mourant Governance Services (Cayman) Limited (for holders of our ordinary shares registered on our Cayman Islands register) and to Computershare Hong Kong Investor Services Limited (for holders of our ordinary shares registered on our Hong Kong register) no later than 4:00 a.m. Cayman Islands Time / 5:00 a.m. New York Time / 5:00 p.m., Hong Kong Time, on June 13, 2021 or your voting instructions to Citibank, N.A. (for holders of our ADSs) no later than 10:00 a.m., New York Time, on June 7, 2021 if you wish to exercise your voting rights.
 

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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE SHAREHOLDER MEETING TO BE HELD ON JUNE 16, 2021
The accompanying Proxy Statement and annual report to shareholders for the year ended December 31, 2020 will also be available to the public at www.beigene.com under “Investors — NASDAQ investors” and “ — HKEX investors”, on the website of the U.S. Securities and Exchange Commission (www.sec.gov) and on the website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk). The form of proxy for use at the 2021 Annual General Meeting of Shareholders is also enclosed. Such form of proxy is also published on the websites of the Company (www.beigene.com), the U.S. Securities and Exchange Commission (www.sec.gov), and Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk).
By Order of the Board of Directors,
[MISSING IMAGE: sg_scottasamuels-bw.jpg]
Scott A. Samuels
Senior Vice President, General Counsel
April   , 2021
Notice to holders of the ordinary shares of BeiGene, Ltd.:
If you are in any doubt as to any aspect of this Proxy Statement 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 adviser.
 

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BEIGENE, LTD.
PROXY STATEMENT FOR
2021 ANNUAL GENERAL MEETING OF SHAREHOLDERS
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PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION
BEIGENE, LTD.
PROXY STATEMENT
FOR THE 2021 ANNUAL GENERAL MEETING OF SHAREHOLDERS
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors (the “Board of Directors”) of BeiGene, Ltd. (the “Company”) for use at its 2021 Annual General Meeting of Shareholders (the “Annual Meeting”) to be held on June 16, 2021 at 6:00 p.m. local time at the offices of Mourant Governance Services (Cayman) Limited, at 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands, for the purpose of considering and, if thought fit, passing the resolutions specified in the Notice of Annual General Meeting. This Proxy Statement is being mailed to shareholders on or about           , 2021.
We intend to hold the Annual Meeting in person at the location specified above. However, we are actively monitoring the coronavirus (“COVID-19”) pandemic and we are sensitive to the public health and travel concerns our shareholders may have and the protocols that national and local governments may impose. In the event that it is not possible or advisable to hold the Annual Meeting in person at the location specified above, we will announce on our Annual Meeting website (www.beigene.com), the website of the U.S. Securities and Exchange Commission (www.sec.gov) and the website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting at an alternative location or by means of remote communication. Please monitor our Annual Meeting website, and the websites of the U.S. Securities and Exchange Commission and Hong Kong Exchanges and Clearing Limited for updated information. If you are planning to attend the Annual Meeting, please check the websites one week prior to the meeting date. As always, we encourage you to vote your shares by proxy or voting instruction prior to the Annual Meeting.
For a proxy to be effective, it must be properly executed and dated and lodged (together with a duly signed and dated power of attorney or other authority (if any) under which it is executed (or a notarized certified copy of such power of attorney or other authority)) at the offices of our registrar in the Cayman Islands, Mourant Governance Services (Cayman) Limited (the “Cayman Registrar”) (for holders of our ordinary shares registered on our Cayman Islands register of members (the “Cayman Register”)) or at the offices of our registrar in Hong Kong, Computershare Hong Kong Investor Services Limited (the “HK Registrar”) (for holders of our ordinary shares registered on our Hong Kong register of members (the “HK Register”)) so as to be received no later than 4:00 a.m. Cayman Islands Time / 5:00 a.m. New York Time / 5:00 p.m., Hong Kong Time, on June 13, 2021. Each proxy properly tendered will, unless otherwise directed by the shareholder, be voted:
1.
FOR the re-election of Donald W. Glazer to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
2.
FOR the re-election of Michael Goller to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
3.
FOR the re-election of Thomas Malley to serve as a Class II director until the 2024 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;
4.
FOR the re-election of Corazon (Corsee) D. Sanders to serve as a Class II director until the 2024 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal;
5.
FOR the approval and ratification of the selection of Ernst & Young Hua Ming LLP and Ernst &
 
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Young as the Company’s independent registered public accounting firms for the fiscal year ending December 31, 2021;
6.
FOR the approval, within the parameters of Rule 13.36 of the HK Listing Rules, of the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or American Depositary Shares (“ADSs”) not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, subject to the conditions described in this Proxy Statement;
7.
FOR the authorization of the Company and its underwriters, in their sole discretion, to allocate to each of Baker Bros. Advisors LP and Hillhouse Capital Management, Ltd. and parties affiliated with each of them (the “Existing Shareholders”), up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Existing Shareholders, subject to the conditions described in this Proxy Statement;
8.
FOR the authorization of the Company and its underwriters, in their sole discretion, to allocate to each of the Existing Shareholders, up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on then-outstanding share capital of the Company) before and after the proposed issue of shares to be listed on the Science and Technology Innovation Board (the “STAR Market”) of the Shanghai Stock Exchange (the “SSE”) and to be traded in Renminbi (“RMB”) pursuant to the general mandate set forth above, subject to the conditions described in this Proxy Statement;
9.
FOR the authorization of the Company and its underwriters, in their sole discretion, to allocate to Amgen Inc. (“Amgen”) up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Amgen, subject to the conditions described in this Proxy Statement;
10.
FOR the authorization of the Company and its underwriters, in their sole discretion, to allocate to Amgen, up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on then-outstanding share capital of the Company) before and after the proposed issue of shares to be listed on the STAR Market and to be traded in RMB pursuant to the general mandate set forth above, subject to the conditions described in this Proxy Statement;
11.
FOR the grant of an option to acquire shares to Amgen to allow Amgen to subscribe for additional shares under a specific mandate in an amount necessary to enable it to increase (and subsequently maintain) its ownership at approximately 20.6% of the Company’s outstanding share capital on an ongoing basis, up to an aggregate of 75,000,000 ordinary shares during the option term, pursuant to the terms of the Restated Amendment No. 2 dated September 24, 2020 (the “Restated Second Amendment”) to the Share Purchase Agreement dated October 31, 2019 (the “Share Purchase Agreement”), as amended, by and between the Company and Amgen;
12.
FOR the grant of restricted share units (“RSUs”) with a grant date fair value of US$3,750,000 to Mr. John V. Oyler under the Second Amended and Restated 2016 Share Option and Incentive Plan (as amended, the “2016 Plan”), according to the terms and conditions described in this Proxy Statement;
13.
FOR the grant of RSUs with a grant date fair value of US$1,000,000 to Dr. Xiaodong Wang under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
 
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14.
FOR the grant of RSUs with a grant date fair value of US$200,000 to each of other non-executive and independent non-executive directors, Mr. Anthony C. Hooper, Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi, under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
15.
FOR the approval, on an advisory basis, of the compensation of our named executive officers, as disclosed in this Proxy Statement;
16.
FOR the adoption of the Sixth Amended and Restated Memorandum and Articles of Association of the Company as described in this Proxy Statement;
17.
FOR the approval of the adjournment of the Annual Meeting by the chairman, if necessary, to solicit additional proxies if there are insufficient votes at the time of the Annual Meeting to approve any of the proposals described above; and
18.
At the discretion of the proxy holder(s) with regard to all other matters that may properly come before the Annual Meeting.
Proposals 6 through 14 are being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
We will pay all of the costs of soliciting proxies. Our directors, officers and employees may also solicit proxies; however, we will not pay them additional compensation for any of these services. Proxies may be solicited by telephone, email, facsimile, personal solicitation or otherwise.
In this Proxy Statement, the terms “BeiGene,” “we,” “us,” and “our” refer to BeiGene, Ltd., and, unless the context otherwise requires, refer to its subsidiaries as well. The mailing address of our principal executive offices is c/o Mourant Governance Services (Cayman) Limited, 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands.
Please note that while our proxy materials and our Annual Report on Form 10-K are available on our website, no other information contained on the website is incorporated by reference into or considered to be part of this document or our Annual Report on Form 10-K.
Shareholders Entitled to Vote; Record Date
Only holders of record of our ordinary shares, par value US$0.0001 per share, at 5:00 a.m. Cayman Islands Time / 6:00 a.m. New York Time / 6:00 p.m. Hong Kong Time on April 19, 2021 (the “record date”) are entitled to notice of, and to attend and to vote at, the Annual Meeting. As of 5:00 a.m. Cayman Islands Time / 6:00 a.m. New York Time / 6:00 p.m. Hong Kong Time on the record date, we had outstanding           ordinary shares, all of which are entitled to vote with respect to all matters to be acted upon at the Annual Meeting, except as otherwise provided in this Proxy Statement. On the record date, approximately                 of the                 outstanding ordinary shares were held in the name of Citibank, N.A. (the “Depositary”) as depositary for the ADSs, which issues Company-sponsored American Depositary Receipts, evidencing ADSs that in turn each represent 13 of our ordinary shares. Each shareholder of record is entitled to one vote for each ordinary share held by such shareholder.
Quorum
We are an exempted company incorporated in the Cayman Islands with limited liability, and our affairs are governed by our amended and restated memorandum and articles of association, which we refer to as our “articles”; the Companies Law (as amended) of the Cayman Islands, which we refer to as the “Cayman Companies Law”; and the common law of the Cayman Islands.
The quorum required for a general meeting of shareholders at which an ordinary resolution is proposed consists of such shareholders present in person or by proxy who together hold shares carrying the right to at least a simple majority of all votes capable of being exercised on a poll. The quorum required for a general
 
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meeting at which a special resolution is proposed consists of such shareholders present in person or by proxy who together hold shares carrying the right to at least two-thirds of all votes capable of being exercised on a poll.
Voting
An ordinary resolution to be passed by the shareholders requires the affirmative vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at a general meeting, while a special resolution requires the affirmative vote of at least two-thirds of the votes cast by the shareholders entitled to vote who are present in person or by proxy at a general meeting (except for certain types of winding up of the Company, in which case the required majority to pass a special resolution is 100%). Both ordinary resolutions and special resolutions may also be passed by a unanimous written resolution signed by all the shareholders of our Company, as permitted by the Cayman Companies Law and our articles. A special resolution is required for important matters such as a change of name and amendments to our articles. Our shareholders may effect certain changes by ordinary resolution, including increasing the amount of our authorized share capital, consolidating and dividing all or any of our share capital into shares of larger amounts than our existing shares and cancelling any authorized but unissued shares.
Proposals 1 through 15 and 17 of this Proxy Statement are all ordinary resolutions and Proposal 16 of this Proxy Statement is a special resolution. The quorum required for the Annual Meeting to approve Proposals 1 through 15 and 17 shall consist of shareholders present in person or by proxy who together hold shares carrying the right to at least a simple majority of all votes capable of being exercised on a poll; and the quorum required for the Annual Meeting to approve Proposal 16 shall consist of shareholders present in person or by proxy who together hold shares carrying the right to at least two-thirds of all votes capable of being exercised on a poll. Approval of Proposals 1 through 15 and 17 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting; and approval of Proposal 15 requires the affirmative vote of at least two-thirds of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting.
Persons who hold our ordinary shares directly on the Cayman Register on the record date (“Cayman record holders”) must either (1) return an executed form of proxy (a) by mail or by hand to the offices of the Cayman Registrar: Mourant Governance Services (Cayman) Limited, 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands, or (b) by email at BeiGene@mourant.com; or (2) attend the Annual Meeting in person to vote on the proposals.
Persons who hold our ordinary shares directly on the HK Register on the record date (“HK record holders,” and together with the Cayman record holders, “record holders”) must either (1) return an executed form of proxy by mail or by hand to the offices of the HK Registrar: Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong; or (2) attend the Annual Meeting in person to vote on the proposals.
However, in the event that it is not possible or advisable for shareholders to travel to the Cayman Islands to attend the meeting in person due to the COVID-19 pandemic, shareholders must vote their shares prior to the Annual Meeting by returning an executed form of proxy as described above.
Persons who own our ordinary shares indirectly on the record date through a brokerage firm, bank or other financial institution, including persons who own our ordinary shares in the form of ADSs through the Depositary (“beneficial owners”), must return a voting instruction form to have their shares or the shares underlying their ADSs, as the case may be, voted on their behalf. Brokerage firms, banks or other financial institutions that do not receive voting instructions from beneficial owners may either vote these shares on behalf of the beneficial owners if permitted by applicable rules or return a proxy leaving these shares un-voted (a “broker non-vote”).
ADS holders are not entitled to vote directly at the Annual Meeting, but the Deposit Agreement, dated as of February 5, 2016, as amended (the “Deposit Agreement”), by and among the Depositary, the Company and the holders of ADSs permits registered holders of ADSs as of the record date to instruct the Depositary how to exercise their voting rights pertaining to the ordinary shares so represented. The Depositary has agreed that it
 
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will endeavor, insofar as practicable and permitted under applicable law and the provisions of the Deposit Agreement, to vote (in person or by delivery to the Company of a proxy) the ordinary shares registered in the name of the Depositary in accordance with the voting instructions received from the ADS holders. If the Depository does not receive instructions from a holder, such holder shall be deemed, and the Depository shall (unless otherwise specified in the notice distributed to holders of ADSs) deem such holder, to have instructed the Depository to give a discretionary proxy to a person designated by us to vote the ordinary shares represented by such holders’ ADSs, provided that no such discretionary proxy may be given by the Depositary with respect to any matter to be voted upon that we inform the Depositary that (a) we do not wish such proxy to be given, (b) substantial opposition exists, or (c) the rights of holders of ordinary shares may be materially adversely affected. In the event that the instruction card is executed but does not specify the manner in which the ordinary shares represented are to be voted (i.e., by marking a vote “FOR,” “AGAINST” or any other option), the Depositary will vote in respect of each proposal as recommended by the Board of Directors as described in the Notice of Annual General Meeting. Instructions from the ADS holders must be sent to the Depositary so that the instructions are received by no later than 10:00 a.m. New York Time on June 7, 2021.
Abstentions and broker non-votes will be counted for the purpose of determining the presence or absence of a quorum, but will not be counted for the purpose of determining the number of votes cast on a given proposal.
We have retained the Cayman Registrar to hold and maintain our Cayman Register and the HK Registrar to hold and maintain our HK Register. The Cayman Registrar and the HK Registrar will be engaged by us to take delivery of completed forms of proxy posted to them in accordance with the details above.
We encourage you to vote by proxy by mailing or emailing or sending by hand an executed form of proxy in accordance with the instructions and deadlines above. Voting in advance of the meeting will ensure that your shares will be voted and reduce the likelihood that we will be forced to incur additional expenses soliciting proxies for the Annual Meeting. Any record holder of our ordinary shares may attend the Annual Meeting in person and may revoke the enclosed form of proxy at any time by:

executing and delivering to the Cayman Registrar or the HK Registrar, as applicable, a later-dated proxy by mail or email or by hand pursuant to the instructions above until 4:00 a.m. Cayman Islands Time / 5:00 a.m. New York Time / 5:00 p.m. Hong Kong Time on June 13, 2021; or

voting in person at the Annual Meeting.
However, in the event that it is not possible or advisable for shareholders to travel to the Cayman Islands to attend the meeting in person due to the COVID-19 pandemic, any record holder of our ordinary shares may revoke the enclosed form of proxy at any time by executing and delivering to the Cayman Registrar or the HK Registrar, as applicable, a later-dated proxy by mail or email or by hand pursuant to the instructions above until 4:00 a.m. Cayman Islands Time / 5:00 a.m. New York Time / 5:00 p.m. Hong Kong Time on June 13, 2021.
Beneficial owners of our ordinary shares and ADSs representing our ordinary shares who wish to change or revoke their voting instructions should contact their brokerage firm, bank or other financial institution or the Depositary, as applicable, for information on how to do so. Beneficial owners who wish to attend the Annual Meeting and vote in person should contact their brokerage firm, bank or other financial institution holding our ordinary shares on their behalf in order to obtain a “legal proxy” which will allow them to both attend the meeting and vote in person. Without a legal proxy, beneficial owners cannot attend or vote at the Annual Meeting because their brokerage firm, bank or other financial institution may have already voted or returned a broker non-vote on their behalf. Record holders of ADSs who wish to attend the Annual Meeting and vote in person should contact the Depositary (and beneficial owners wishing to do the same should contact their brokerage firm, bank or other financial institution holding their ADSs) to cause their ADSs to be cancelled and the underlying shares to be withdrawn in accordance with the terms and conditions of the Deposit Agreement so as to be recognized by us as a record holder of our ordinary shares.
The Company strongly recommends that you monitor the development of the COVID-19 pandemic and assess, based on social distancing practices, the necessity for attending the Annual Meeting in person.
 
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Accordingly, the Board of Directors respectfully requests that the shareholders appoint the Chairman of the Annual Meeting as their proxy rather than a third party to attend and vote on their behalf at the Annual Meeting (or any adjournment or postponement thereof).
No Appraisal Rights
Our shareholders have no rights under the Cayman Companies Law or under our articles to exercise dissenters’ or appraisal rights with respect to the proposals being voted on.
Expenses of Solicitation
We are making this solicitation and will pay the entire cost of preparing and distributing the proxy materials and soliciting votes. If you choose to access the proxy materials over the Internet, you are responsible for any Internet access charges that you may incur. Our officers, directors and employees may, without compensation other than their regular compensation, solicit proxies through further mailings, personal conversations, facsimile transmissions, emails or otherwise. Proxy solicitation expenses that we will pay include those for preparation, mailing, returning and tabulating the proxies.
Procedure for Submitting Shareholder Proposals
The Cayman Companies Law provides shareholders with only limited rights to requisition a general meeting and does not provide shareholders with a right to put any proposal before a general meeting. However, these rights may be provided in a company’s articles of association. Our articles allow our shareholders holding in aggregate not less than one-tenth of the voting rights of issued shares and entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders, in which case the Board of Directors is obliged to convene an extraordinary general meeting and to submit the resolutions put forward to a vote at such meeting. Additionally, under our articles, at a properly requisitioned extraordinary general meeting, our shareholders will have right to propose resolutions with respect to the election, appointment or removal of directors. Our articles provide no other right to put any proposals before annual general meetings or extraordinary general meetings. As a Cayman Islands exempted company, we are not obligated by law to call annual general meetings of shareholders. However, our corporate governance guidelines require us to call such meetings every year to the extent required by the listing rules of any stock exchange on which our ordinary shares or ADSs are traded.
Shareholders may present proper proposals for inclusion in our proxy statement and for consideration at our next annual general meeting of shareholders by submitting their proposals in writing to us in a timely manner. In order to be considered for inclusion in the proxy statement for the 2022 annual general meeting of shareholders, shareholder proposals must be received at our principal executive offices no later than           , 2021, and must otherwise comply with the requirements of Rule 14a-8 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any shareholder proposal for the annual general meeting of shareholders in 2022, which is submitted outside the processes of Rule 14a-8, shall be considered untimely unless received by the Company in writing no later than           , 2022. If the date of the annual general meeting is moved by more than 30 days from the date contemplated at the time of the previous year’s proxy statement, then notice must be received within a reasonable time before we begin to print and send proxy materials. If that happens, we will publicly announce the deadline for submitting a proposal in a press release or in a document filed with the U.S. Securities and Exchange Commission (“SEC”) and announced in Hong Kong via the website of Hong Kong Exchange and Clearing Limited (www.hkexnews.hk). A copy of all notices of proposals by shareholders should be sent to us at BeiGene, Ltd., c/o Mourant Governance Services (Cayman) Limited, 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands.
Results of Annual Meeting
Results of the Annual Meeting will be posted on the website of the Company (www.beigene.com) and on the website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) upon the conclusion of the Annual Meeting and on the website of the SEC (www.sec.gov) in a Current Report on Form 8-K filed by us within four business days of the conclusion of the Annual Meeting.
 
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OVERVIEW OF PROPOSALS
This Proxy Statement contains the following 17 proposals requiring shareholder action:
Proposals 1 to 4 request the re-election of four directors to the Board of Directors;
Proposal 5 requests the approval and ratification of the appointment of Ernst & Young Hua Ming LLP and Ernst & Young as our independent registered public accounting firms for the fiscal year ending December 31, 2021;
Proposal 6 requests the approval, within the parameters of Rule 13.36 of the HK Listing Rules, of the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or ADSs not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, subject to the conditions described in this Proxy Statement.
Proposal 7 requests the authorization of the Company and its underwriters, in their sole discretion, to allocate to each of Baker Bros. Advisors LP and Hillhouse Capital Management, Ltd. and parties affiliated with each of them (the “Existing Shareholders”), up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Existing Shareholders, subject to the conditions described in this Proxy Statement;
Proposal 8 requests the authorization of the Company and its underwriters, in their sole discretion, to allocate to each of the Existing Shareholders, up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on then-outstanding share capital of the Company) before and after the proposed issue of shares to be listed on the STAR Market and to be traded in RMB pursuant to the general mandate set forth above, subject to the conditions described in this Proxy Statement;
Proposal 9 requests the authorization of the Company and its underwriters, in their sole discretion, to allocate to Amgen up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the general mandate set forth above for a period of five years, which period will be subject to an extension on a rolling basis each year, conditional on the approval of the shareholders who are not Amgen, subject to the conditions described in this Proxy Statement;
Proposal 10 requests the authorization of the Company and its underwriters, in their sole discretion, to allocate to Amgen, up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on then-outstanding share capital of the Company) before and after the proposed issue of shares to be listed on the STAR Market and to be traded in RMB pursuant to the general mandate set forth above, subject to the conditions described in this Proxy Statement;
Proposal 11 requests the approval of the grant of an option to acquire shares to Amgen to allow Amgen to subscribe for additional shares under a specific mandate in an amount necessary to enable it to increase (and subsequently maintain) its ownership at approximately 20.6% of the Company’s outstanding share capital, up to an aggregate of 75,000,000 ordinary shares during the option term, pursuant to the terms of the Restated Amendment No. 2 dated September 24, 2020 to the Share Purchase Agreement dated October 31, 2019, as amended, by and between the Company and Amgen;
Proposal 12 requests the approval of the grant of RSUs with a grant date fair value of US$3,750,000 to Mr. John V. Oyler under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
Proposal 13 requests the approval of the grant of RSUs with a grant date fair value of US$1,000,000 to Dr. Xiaodong Wang under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
 
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Proposal 14 requests the approval of the grant of RSUs with a grant date fair value of US$200,000 to each of other non-executive and independent non-executive directors, Mr. Anthony C. Hooper, Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi, under the 2016 Plan, according to the terms and conditions described in this Proxy Statement;
Proposal 15 requests the approval, on an advisory basis, of the compensation of our named executive officers, as disclosed in this Proxy Statement;
Proposal 16 requests the adoption of the Sixth Amended and Restated Memorandum and Articles of Association of the Company as described in this Proxy Statement; and
Proposal 17 requests the approval of the adjournment of the Annual Meeting by the chairman, if necessary, to solicit additional proxies if there are insufficient votes at the time of the Annual Meeting to approve any of the proposals described above (the “Adjournment Proposal”).
Proposals 6 through 14 are being submitted for shareholder approval as required by and in compliance with the HK Listing Rules. Each of the proposals is discussed in more detail in the pages that follow.
 
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PROPOSALS 1 – 4
ELECTION OF DIRECTORS
Our articles provide that persons standing for election as directors at a duly constituted general meeting of shareholders with a requisite quorum shall be elected by an ordinary resolution of our shareholders, which requires the affirmative vote of a simple majority of the votes cast on the resolution by the shareholders entitled to vote who are present in person or by proxy at the meeting. Our articles further provide that the Board of Directors will be divided into three groups designated as Class I, Class II and Class III with as nearly equal a number of directors in each group as possible, with each director serving a three-year term and until his or her successor is duly elected and qualified, subject to his or her earlier resignation or removal.
Upon the expiration of the term of each class, each director in that class, if nominated by the Board of Directors, shall be eligible for re-election at the annual general meeting to hold office for another three-year term and until such director’s successor has been duly elected. Our articles provide that, unless otherwise determined by shareholders in a general meeting, the Board of Directors will consist of not less than three directors. We have no provisions relating to retirement of directors upon reaching a specified age.
In the event of a vacancy arising from the resignation of a director or as an addition to the existing board, the Board of Directors may, by the affirmative vote of a simple majority of the remaining directors present and voting at a board meeting, appoint any person to be a director.
For so long as our ordinary shares or ADSs are listed on The NASDAQ Global Select Market (“NASDAQ”), and The Stock Exchange of Hong Kong Limited (“HKEx”), our directors are required to comply with the director nomination procedures of the NASDAQ Stock Market and the HK Listing Rules, and the Board of Directors is required to include at least such number of independent directors as required by the NASDAQ rules and the HK Listing Rules.
The terms of the Class II directors are scheduled to expire on the date of the 2021 Annual Meeting. Our current Class II directors were most recently elected by the shareholders at the 2018 Annual Meeting except that Corazon (Corsee) D. Sanders was appointed as a Class II director in August 2020 by the Board of Directors through the filling of a vacancy as permitted by our articles. Based on the recommendation of the Nominating and Corporate Governance Committee of the Board of Directors (the “Nominating Committee”), the Board of Directors’ nominees for election by the shareholders are the current Class II members: Donald W. Glazer, Michael Goller, Thomas Malley and Corazon (Corsee) D. Sanders. If elected, each nominee will serve as a director until the annual general meeting of shareholders in 2024 and until his or her successor is duly elected and qualified, subject to his or her earlier resignation or removal.
We have received from each of Donald W. Glazer, Michael Goller, Thomas Malley and Corazon (Corsee) D. Sanders an annual confirmation of independence pursuant to the NASDAQ rules and Rule 3.13 of the HK Listing Rules and consider each of them independent under the NASDAQ rules and the HK Listing Rules.
The names of and certain information about the directors in each of the three classes are set forth below. There are no family relationships among any of our directors or executive officers.
The proxy in the form presented will be voted, unless otherwise indicated, for the election of the Class II director nominees to the Board of Directors. If any of the nominees should for any reason be unable or unwilling to serve at any time prior to the Annual Meeting, the proxies will be voted for the election of a substitute nominee designated by the Board of Directors.
Set forth below are the biographies of each director, as well as a discussion of the particular experience, qualifications, attributes, and skills that led the Board of Directors to conclude that each such person nominated to serve or currently serving on the Board of Directors should serve as a director.
 
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Nominees of Class II Directors for Election for a Three-Year Term Ending at the 2024 Annual General Meeting
The names of the nominees for Class II directors and certain information about each as of April 1, 2021 are set forth below.
Name
Position(s)
Directors Since
Age
Donald W. Glazer
Director
2013
76
Michael Goller
Director
2015
46
Thomas Malley
Director
2016
52
Corazon (Corsee) D. Sanders
Director
2020
64
Mr. Donald W. Glazer, aged 76, has served as a member of the Board of Directors since February 2013. Mr. Glazer has served as a member of the Board of Trustees of GMO Trust, a mutual fund group, since 2000 and as the Chairman of the board of GMO Trust since 2005. Mr. Glazer was a Co-Founder and Secretary, and from 2002 until 2010, Vice Chairman, of Provant, Inc., a provider of performance improvement training solutions. From 1992 to 1995 Mr. Glazer was President of Mugar/Glazer Holdings and from 1992 to 1993 served as Vice Chairman — Finance of New England Television Corp. and WHDH-TV, Inc. From 1997 to the present, Mr. Glazer has served as Advisory Counsel to the law firm Goodwin Procter LLP. From 1970 to 1978 Mr. Glazer was an associate and from 1978 to 1992 a partner at the law firm Ropes & Gray LLP. At Ropes & Gray, Mr. Glazer chaired the firm’s Emerging Companies Group. Mr. Glazer was also a Lecturer in Law at Harvard Law School from 1978 to 1991, teaching a course called The Business Lawyer. In addition to Provant, Inc. and New England Television Corp., Mr. Glazer is a former member of the boards of directors of Environics Inc.; Kronos Incorporated; Reflective Technologies, Inc.; and Teleco Oilfield Services Inc. Mr. Glazer received his A.B. from Dartmouth College in June 1966; J.D. from Harvard Law School in June 1969, where he was an editor of the Harvard Law Review; and L.L.M. from the University of Pennsylvania Law School in May 1970. Additionally, Mr. Glazer is a co-author of both Glazer and FitzGibbon on Legal Opinions, Third Edition (Aspen Publishers) and Massachusetts Corporation Law & Practice, Second Edition (Aspen Publishers). We believe that Mr. Glazer’s qualifications to serve on the Board of Directors include his extensive leadership, executive, managerial, business, and corporate legal experience.
As of April 1, 2021, Mr. Glazer was interested in 3,155,247 ordinary shares of the Company within the meaning of Part XV of the Hong Kong Securities and Futures Ordinance (the “SFO”). The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules.
Mr. Michael Goller, aged 46, has served as a member of the Board of Directors since April 2015. Mr. Goller is a Partner at Baker Brothers Investments. Prior to joining Baker Brothers in 2005, Mr. Goller was as an Associate of JPMorgan Partners, LLC, where he focused on venture investments in the life sciences sector from 1999 to 2003. Mr. Goller began his career as an investment banker with Merrill Lynch and Co. from 1997 to 1999. Mr. Goller received a B.S. in Molecular and Cell Biology from The Pennsylvania State University in May 1997, and a Master in both Biotechnology (School of Engineered and Applied Sciences) and Business Administration (Wharton School) from the University of Pennsylvania in May 2005. Mr. Goller serves on the boards of DBV Technologies SA, a company listed on the NASDAQ and on Euronext Paris and Levo Therapeutics, Inc. We believe that Mr. Goller is qualified to serve on the Board of Directors based on his experience in the life sciences industry and for his knowledge in financial and corporate development matters.
As of April 1, 2021, Mr. Goller was interested in 336,700 ordinary shares of the Company within the meaning of Part XV of the SFO. The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules.
Mr. Thomas Malley, aged 52, has served as a member of the Board of Directors since January 2016. Mr. Malley has served as president of Mossrock Capital, LLC, a private investment firm, since May 2007. Mr. Malley worked for Janus Mutual Funds in positions of increasing responsibility from April 1991 to May 2007. From January 1999 to May 2007, Mr. Malley served as the portfolio manager of the Janus Global Life Sciences Fund and also led the Janus healthcare team of analysts. From 1991 to 1998, Mr. Malley
 
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served as an equity analyst for Janus covering, among others, healthcare and biotechnology stocks. Mr. Malley received a B.S. in Biology from Stanford University in June 1991. Mr. Malley has held directorships in the following listed companies: Kura Oncology, Inc., a company listed on the NASDAQ, as a director since 2015; Kiniksa Pharmaceuticals, a company listed on the NASDAQ, as a director since 2016; OvaScience, Inc., a company listed on the NASDAQ prior to its merger with Millendo Therapeutics, Inc. in December 2018, as a director from 2012 to 2017; Synageva BioPharma Corp., a Company listed on the NASDAQ prior to its delisting in May 2015 in connection with the sale of the company, as a director from 2006 to 2015; Puma Biotechnology, Inc., a company listed on the NASDAQ, as a director from 2011 to 2015; and Cougar Biotechnology, Inc., a company listed on the NASDAQ prior to its delisting in July 2009 in connection with the sale of the company, as a director from 2007 to 2009. The Board of Directors believes that Mr. Malley’s experience in the biopharmaceutical industry, including serving on other boards of directors, and his financial and executive experience qualify him to serve on the Board of Directors.
As of April 1, 2021, Mr. Malley was interested in 1,249,448 ordinary shares of the Company within the meaning of Part XV of the SFO. The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules.
Dr. Corazon (Corsee) D. Sanders, aged 64, has served as a member of the Board of Directors since August 2020. Dr. Sanders most recently served as an Interim Transition Advisor to the Global Development Group of Bristol Myers Squibb Corporation from November 2019, following its acquisition of Celgene Corporation, until February 2020. Previously, Dr. Sanders served as a Strategic Advisor to the Office of the Celgene Chief Medical Officer from March 2018 to November 2019. From January 2017 to March 2018, she was a member of the Juno Therapeutics Executive Committee as Executive Vice President of Development Operations, with responsibilities for strategic operations, quantitative sciences, biosample and clinical operations. From 1994 to 2017, Dr. Sanders held leadership positions at Genentech/Roche, including as a member of the Genentech/Roche Late Stage Portfolio Committee, Global Head of the Genentech/Roche Late Stage Clinical Operations, Global Head of the Genentech/Roche Biometrics group, and Genentech Head of DATA (Design, Analysis, Technology & Administration) prior to the Roche acquisition. Dr. Sanders currently serves as a member of the Board of Trustees of the Fred Hutchinson Cancer Research Center in Seattle, WA, and as a director of the following biotechnology companies: Molecular Templates Inc. (NASDAQ: MTEM), Legend Biotech Corporation (NASDAQ: LEGN), and AltruBio Inc. (formerly AbGenomics) (privately-held). Dr. Sanders earned her B.S. and M.S. in statistics, graduating Magna Cum Laude from the University of the Philippines, and her M.A. and Ph.D. in statistics from the Wharton Doctoral Program at the University of Pennsylvania. We believe that Dr. Sanders’ extensive experience and knowledge in the healthcare sector and her scientific and leadership experience qualify her to serve on, and contributes to the diversity of, the Board of Directors.
As of April 1, 2021, Dr. Sanders was interested in 27,482 ordinary shares of the Company within the meaning of Part XV of the SFO. The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules.
Nomination Policy and Procedure for Independent Non-executive Directors
When nominating candidates for election to the Board of Directors, the Nominating Committee of the Board of Directors evaluates skills, knowledge and experience required by the Board of Directors, and identifies if there are any special requirements for the vacancy.
The Nominating Committee identifies appropriate candidates and discusses and votes in respect of the nominated directors, and recommends candidates for directors to the Board of Directors. In reviewing the structure of the Board of Directors, the Nominating Committee will consider board diversity from a number of aspects, including but not limited to nationality, ethnicity, gender, age, skills, expertise, and industry and regional experience. All Board of Directors nominations will be based on meritocracy and candidates will be considered against criteria including talent, skills and experience as may be necessary for the operation of the Board of Directors as a whole, with a view to maintaining a sound balance of the Board of Directors’ composition, and where nomination of independent non-executive directors is under consideration, the requirements of Rule 3.13 of the HK Listing Rules shall be satisfied.
 
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The Nominating Committee is of the view that the re-election of Mr. Donald W. Glazer as an independent non-executive director will bring to the Company a wealth of extensive leadership, executive, managerial, business, and corporate legal experience.
The Nominating Committee is of the view that the re-election of Mr. Michael Goller as an independent non-executive director will enrich the Company’s knowledge and experience in the life sciences industry and financial and corporate development matters.
The Nominating Committee is of the view that the re-election of Mr. Thomas Malley as an independent non-executive director will enrich the Company’s knowledge and experience in the biopharmaceutical industry and financial matters.
The Nominating Committee is of the view that the re-election of Dr. Corazon (Corsee) D. Sanders as an independent non-executive director will enrich the Company’s knowledge and experience in conducting business in the healthcare sector and in scientific and clinical development and promote diversity on the Board of Directors.
In view of the above, in April 2021, the Nominating Committee recommended to the Board of Directors that Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Thomas Malley and Dr. Corazon (Corsee) D. Sanders be nominated for re-election to the Board of Directors and the Board of Directors has recommended them to be elected by shareholders at the Annual Meeting.
The Board of Directors considers that each of the candidates for independent non-executive director has many years of experience working in various sectors globally and has made significant contributions. Their election will facilitate better supervision of the Company’s business operations. Moreover, each of the candidates for independent non-executive directors has confirmed his or her independence pursuant to Rule 3.13 of the HK Listing Rules. The Board of Directors also considers that Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Thomas Malley and Dr. Corazon (Corsee) D. Sanders meet the independence guidelines set out in Rule 3.13 of the HK Listing Rules and is independent in accordance with the terms of the guidelines.
Directors Not Standing for Re-Election
The names of and certain information as of April 1, 2021 about the members of the Board of Directors who are not standing for re-election at the 2021 Annual Meeting are set forth below.
Name
Position(s)
Director Since
Age
John V. Oyler
Director
2010
53
Timothy Chen
Director
2016
64
Jing-Shyh (Sam) Su
Director
2018
68
Xiaodong Wang
Director
2016
58
Anthony C. Hooper
Director
2020
66
Ranjeev Krishana
Director
2014
47
Qingqing Yi
Director
2014
49
Class I Directors Continuing in Office Until the 2023 Annual General Meeting
Mr. John V. Oyler, aged 53, is our Co-Founder, Chief Executive Officer and Chairman of the Board of Directors. He has served as a member of the Board of Directors since October 2010. From 2005 to 2009, Mr. Oyler served as President and Chief Executive Officer of BioDuro, LLC, a drug discovery outsourcing company, which was acquired by Pharmaceutical Product Development Inc. From 2002 to 2004, Mr. Oyler served as Chief Executive Officer of Galenea Corp., a biopharmaceutical company dedicated to the discovery of novel therapies for central nervous system diseases, which initially were developed at Massachusetts Institute of Technology. From 1998 to 2002, Mr. Oyler was a Founder and the President of Telephia, Inc. which was bought by The Nielsen Company in 2007. From 1997 to 1998, Mr. Oyler served as Co-Chief Executive Officer of Genta Incorporated, an oncology-focused biopharmaceutical company that was listed on the NASDAQ. Mr. Oyler began his career as a management consultant at
 
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McKinsey & Company. Mr. Oyler received his B.S. from the Massachusetts Institute of Technology in June 1990 and an MBA from Stanford University in January 1996. Mr. Oyler’s qualifications to serve on the Board of Directors include his extensive leadership, executive, managerial, business and pharmaceutical and biotechnology company experience, along with his years of industry experience in the development of pharmaceutical products.
Mr. Timothy Chen, aged 64, has served as a member of the Board of Directors since February 2016. Mr. Chen has served as Co-Chairman of Suirui Technology Group Limited, a company listed on the China National Equities Exchange and Quotations since December 2018. From January to November 2018, Mr. Chen served as the Chairman of Foxconn Industrial Internet Company, a company listed on the Shanghai Stock Exchange since June 2018. From January 2016 to March 2018, he served as the President and Chief Executive Officer of Asia Pacific Telecom and as the Corporate Vice President of Hon Hai Technology Group. He served as the President of Telstra International Group and Advisor to Telstra Chief Executive Officer from November 2012 to December 2015. He was also the Chairman of Autohome, a company listed on the NASDAQ and a director of Qingdao Haier Co., Ltd., a company listed on the Shanghai Stock Exchange. He was a Non-Executive Director on the board of Telstra Corporation Limited, a company listed on the Australian Securities Exchange between April 2012 and November 2012, and an Independent Director of Guiyang Longmaster Information and Technology Company Limited, a company listed on the Shenzhen Stock Exchange from October 2010 to October 2013. Previously, Mr. Chen was a partner of a China Opportunities Fund within GL Capital Group. He was the Chief Executive Officer of National Basketball Association China from 2007 to 2010; the Corporate Vice President of Microsoft and the Chief Executive Officer of its Greater China Region from 2003 to 2007; and the Corporate Vice President of Motorola and the Chairman and President of Motorola (China) Electronics from 2001 to 2003. Before Motorola, he was the Chief Executive Officer of 21CN Cybernet, a company listed on the HKEx from 2000 to 2001. Prior to 2000, Mr. Chen spent eight years in China with Motorola, including serving as the General Manager responsible for the sales and marketing for the Greater China Cellular Infrastructure Division. He also spent nine years with AT&T Bell Laboratories in the United States. Mr. Chen currently serves as an Independent Non-Executive Director of CCID Consulting Company Limited, a company listed on the HKEx. Mr. Chen also serves as a Director of Asia Pacific Telecom, a company listed on the Taiwan Stock Exchange. Mr. Chen earned an MBA Degree from the University of Chicago in August 1991 and a master’s degree in both computer science and mathematics from Ohio State University in June 1982. We believe that Mr. Chen’s extensive business expertise in Asia and globally qualifies him to serve as a member of the Board of Directors.
Mr. Jing-Shyh (Sam) Su, aged 68, has served as a member of the Board since April 2018. Mr. Su retired from Yum! Brands, Inc., a company listed on the New York Stock Exchange (“Yum! Brands”), in May 2016, where he served as Vice Chairman of the Board, and was the Chairman and CEO of the company’s China division. During Mr. Su’s 26 years with Yum! Brands, its China division grew from just four restaurants to over 7,000 to become the largest multinational restaurant chain in China, contributing more than half of Yum! Brands’ worldwide revenues in 2015. Mr. Su started his career with Yum! Brands in 1989 as KFC International’s director of marketing for the North Pacific region. In 1993, he became vice president of North Asia for both KFC and Pizza Hut. Mr. Su was named president of Greater China for Tricon Global Restaurants International upon Pepsi’s spin-off of the restaurant business in 1997. Before joining Yum! Brands, Mr. Su worked with Procter & Gamble in Germany and Taiwan. Mr. Su earned his undergraduate degree at the National Taiwan University in June 1974, a M.Sc. degree in Chemical Engineering at Pennsylvania State University in May 1978, and an MBA at the Wharton School of the University of Pennsylvania in May 1983. Mr. Su currently serves as a director of Li Ning Company Limited, a company listed on the Main Board of the HKEx (stock code: 2331), and of Peet’s Coffee China. We believe that Mr. Su is qualified to serve on the Board of Directors based on his operating and management experience, expertise in marketing and brand development, particularly in China, and expertise in strategic planning and international business development.
Class III Directors Continuing in Office Until the 2022 Annual General Meeting
Xiaodong Wang, Ph.D., aged 58, is our Co-Founder and has served as a member of the Board of Directors since February 2016. He has also served as the Chairman of our Scientific Advisory Board since 2011. Dr. Wang has served as the founding Co-Director of the National Institute of Biological Sciences in
 
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Beijing since 2003 and became its Director and Investigator in 2010. In addition, Dr. Wang has served as a Chair Professor at Tsinghua University since 2020. Previously, he was a Howard Hughes Medical Institute Investigator from 1997 to 2010 and held the position of the George L. MacGregor Distinguished Chair Professor in Biomedical Sciences at the University of Texas Southwestern Medical Center in Dallas, Texas from 2001 to 2010. In 2004, Dr. Wang founded Joyant Pharmaceuticals, Inc., a venture capital-backed biotechnology company focused on the development of small molecule therapeutics for cancer. Dr. Wang received his B.S. in Biology from Beijing Normal University in July 1984 and his Ph.D. in Biochemistry from the University of Texas Southwestern Medical Center in May 1991. Dr. Wang has been a member of the National Academy of Science, USA since 2004 and a foreign associate of the Chinese Academy of Sciences since 2013. We believe that Dr. Wang’s extensive experience in cancer drug research, combined with his experience in the biotech industry, qualifies him to serve as a member of the Board of Directors.
Mr. Anthony C. Hooper, aged 66, has served as a member of the Board of Directors since January 2020. Mr. Hooper retired from Amgen in January 2020, where he was Executive Vice President from September 2018 to January 2020, and Executive Vice President, Global Commercial Operations from 2011 to August 2018. From 2010 to 2011, Mr. Hooper was Senior Vice President, Commercial Operations and President, U.S., Japan and Intercontinental of Bristol Myers Squibb Company (BMS). From 2009 to 2010, Mr. Hooper was President, Americas of BMS. From 2004 to 2009, Mr. Hooper was President, U.S. Pharmaceuticals, Worldwide Pharmaceuticals Group, a division of BMS. Prior to that, Mr. Hooper held various senior leadership positions at BMS. Prior to joining BMS, Mr. Hooper was Assistant Vice President of Global Marketing for Wyeth Laboratories. Mr. Hooper earned law and MBA degrees from the University of South Africa in 1978 and 1988 respectively. Mr. Hooper serves on the board of MannKind Corporation, a company listed on the NASDAQ (ticker symbol: MNKD). Mr. Hooper is a consultant of Amgen. We believe Mr. Hooper’s extensive experience and knowledge in the healthcare sector and broad international experience in pharmaceutical commercial operations qualify him to serve on, and contributes to the diversity of, the Board of Directors.
Mr. Ranjeev Krishana, aged 47, has served as a member of the Board of Directors since October 2014 and as the Lead Director since February 2020. Mr. Krishana has worked at Baker Bros. Advisors LP, from 2011 to the present and currently serves as Head of International Investments. Prior to joining Baker Bros., Mr. Krishana held a series of commercial, strategy, and business development leadership roles for Pfizer, Inc.’s pharmaceutical business across a variety of international regions and markets, including Asia, Eastern Europe, and Latin America. Mr. Krishana was at Pfizer from 2003 to 2007 and from 2008 to 2011. From 2008 to 2010, Mr. Krishana was based in Beijing, China, where he served as a Senior Director and a member of the Pfizer China Leadership Team. Mr. Krishana began his career as a strategy consultant at Accenture plc. Mr. Krishana received a B.A. in Economics and Political Science from Brown University in May 1995, and a Master of Public Policy from Harvard University in June 2011. We believe Mr. Krishana’s knowledge of the healthcare sector across international markets qualifies him to serve on the Board of Directors.
Mr. Qingqing Yi, aged 49, has served as a member of the Board of Directors since October 2014. Mr. Yi is a Partner at Hillhouse Capital. He has worked with Hillhouse since the inception of the firm in 2005. Prior to joining Hillhouse, Mr. Yi was an Equity Research Analyst at China International Capital Corporation. Mr. Yi’s work at Hillhouse includes investments in the healthcare and consumer sectors in both its public and private equity portfolios. Mr. Yi received a B.S. degree in Engineering from Shanghai Maritime University in July 1995 and an MBA from University of Southern California in May 2003. We believe Mr. Yi’s extensive experience in capital markets and knowledge of the healthcare sector qualify him to serve on the Board of Directors.
Vote Required and Board of Directors’ Recommendation
Each director nominated for election will be elected if a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy vote at the Annual Meeting in favor of such director. Broker non-votes and abstentions with respect to one or more Class II directors will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the election.
The proposals for the election of directors relate solely to the election of Class II directors nominated by the Board of Directors.
The Board of Directors recommends that shareholders vote FOR the election of each of the Class II director nominees listed above.
 
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PROPOSAL 5
APPROVAL AND RATIFICATION OF APPOINTMENT
OF INDEPENDENT AUDITORS
Upon recommendation of the Audit Committee of the Board of Directors (the “Audit Committee”), the Board of Directors has appointed Ernst & Young Hua Ming LLP, an independent registered public accounting firm in the People’s Republic of China (“PRC”), and Ernst & Young, an independent registered public accounting firm in Hong Kong, as the Company’s independent registered public accounting firms for the fiscal year ending December 31, 2021. Ernst & Young Hua Ming is responsible for auditing our annual consolidated financial statements filed with the SEC and internal control over financial reporting in accordance with the Exchange Act, and Ernst & Young is responsible for auditing our annual financial statements filed with the HKEx in accordance with the HK Listing Rules. Both Ernst & Young Hua Ming and Ernst & Young are members of the global Ernst & Young firm. The Board of Directors recommends that shareholders vote for approval and ratification of this appointment. If this proposal is not approved at the Annual Meeting, the Board of Directors will reconsider its appointment. Ernst & Young Hua Ming LLP has audited our financial statements filed with the SEC and internal control over financial reporting for the fiscal years ended December 31, 2020 and 2019. Ernst & Young has audited our financial statements filed with the HKEx for the fiscal years ended December 31, 2020 and 2019. We expect representatives of Ernst & Young Hua Ming LLP and Ernst & Young to be available at the Annual Meeting in person or via teleconference and available to respond to appropriate questions. They will have the opportunity to make a statement if they desire to do so.
Auditors’ Fees
The following table summarizes the fees of Ernst & Young Hua Ming LLP and Ernst & Young, our registered independent public accounting firms, billed to us for each of the last two fiscal years (in thousands).
2020
2019
Fee Category
Ernst & Young
Hua Ming LLP
Ernst & Young
Total
Ernst & Young
Hua Ming LLP
Ernst & Young
Total
Audit Fees(1)
US$3,313
US$498
US$3,811
US$1,821
US$369
US$2,190
Tax Fees(2)
25
25
24
24
All Other Fees(3)
72
72
27
27
Total Fees
US$3,313
US$595
US$3,908
US$1,821
US$420
US$2,241
(1)
Audit fees consist of fees for the audit of our financial statements and internal control over financial reporting, quarterly review of financial statements included in the Company’s Quarterly Reports on Form 10-Q and audit services associated with our registration statements, prospectus supplements, services related to the Company’s Hong Kong listing, services related to the Company’s STAR Market offering and other statutory and regulatory filings.
(2)
Tax fees consist of fees incurred for tax advisory services.
(3)
All other fees consist of compliance related consulting services.
Pre-approval Policies
The Board of Directors has adopted policies and procedures for the pre-approval of audit and non-audit services by the Audit Committee for the purpose of maintaining the independence of our independent auditors. We may not engage our independent auditors to render any audit or non-audit service unless either the service is approved in advance by the Audit Committee or the engagement to render the service is entered into pursuant to the Audit Committee’s pre-approval policies and procedures.
Pursuant to its pre-approval policy, the Audit Committee may delegate its authority to pre-approve services to the chairperson of the Audit Committee. The decisions of the chairperson to grant pre-approvals must be presented to the full Audit Committee at its next scheduled meeting. The Audit Committee may not delegate its responsibilities to pre-approve services to the management.
 
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The Audit Committee has considered the non-audit services provided by Ernst & Young Hua Ming LLP and Ernst & Young as described above and believes that they are compatible with maintaining the firms’ independence as our external auditors. In accordance with Regulation S-X, Rule 2-01, paragraph (c)(7)(i), no fees for services in 2020 and 2019 were approved pursuant to any waivers of the pre-approval requirement.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 5 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 5 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR approval and ratification of the appointment of Ernst & Young Hua Ming LLP and Ernst & Young as our independent registered public accounting firms for the fiscal year ending December 31, 2021.
 
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PROPOSAL 6
GENERAL MANDATE TO ISSUE SHARES
In order to give the Company the flexibility to issue ordinary shares and/or ADSs if and when appropriate and in accordance with Rule 13.36 of the HK Listing Rules, the Company proposes an ordinary resolution at the Annual Meeting to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or ADSs not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution (i.e., a total of              ordinary shares as of April 19, 2021 on the basis that no further ordinary shares are issued or repurchased before the Annual Meeting) up to the next annual general meeting of shareholders of the Company (the “General Mandate to Issue Shares”). The General Mandate to Issue Shares shall remain in force until:
(a)
the conclusion of the next annual general meeting of shareholders of the Company unless, by an ordinary resolution passed at that meeting, the General Mandate to Issue Shares is renewed, either unconditionally or subject to conditions; or
(b)
revoked or varied by an ordinary resolution of the shareholders in a general meeting,
whichever occurs first.
Proposal 6 is being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
The Board of Directors currently plans to issue no more than 132,313,549 ordinary shares (representing no more than 11.1% of the total number of issued shares of the Company as of the date of this Proxy Statement) to be subscribed for in RMB by investors in the PRC (the “RMB Shares”) and listed on the STAR Market of the SSE pursuant to the General Mandate to Issue Shares (the “Proposed Issue of RMB Shares”). The Proposed Issue of RMB Shares is conditioned upon and subject to, among other things, approval by the shareholders of Proposals 6 and 16 at the Annual Meeting, market conditions, and the receipt of necessary regulatory approvals, and thus may or may not proceed. Shareholders and potential investors of the Company should be aware that there is no assurance that the Proposed Issue of RMB Shares will materialize or as to when it may materialize. For additional information regarding the Proposed Issue of RMB Shares, please refer to the Company’s Current Report on Form 8-K dated January 29, 2021 filed with the SEC and announcements dated January 29, 2021 and April   , 2021 filed with the HKEx.
The adoption of the General Mandate to Issue Shares is not conditioned on the shareholder approval of the Connected Person Placing Authorization I, the Connected Person Placing Authorization IA (for the Issue of RMB Shares), the Connected Person Placing Authorization II and the Connected Person Placing Authorization IIA (for the Issue of RMB Shares) described in Proposals 7, 8, 9 and 10.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 6 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 6 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the
General Mandate to Issue Shares.
 
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PROPOSAL 7
CONNECTED PERSON PLACING AUTHORIZATION I
As a commercial stage biotechnology company, the Company believes that efficient access to capital on a continuing basis is essential to funding the Company’s business plans, and participation in capital raisings by biotech-focused funds with deep industry knowledge (such as the Company’s existing shareholders, Baker Bros. Advisors LP and Hillhouse Capital Management, Ltd. and parties affiliated with each of them (the “Existing Shareholders”)), is often crucial to the success of capital raising transactions. In connection with the Company’s listing on the HKEx in August 2018, the Company therefore applied for, and the HKEx granted, a waiver (the “Waiver”) from strict compliance with Rule 13.36(1) of the HK Listing Rules and the independent shareholder approval requirements set out in Chapter 14A of the HK Listing Rules in respect of the Connected Person Placing Authorization I (as defined below).
In order to give the Company the flexibility to issue ordinary shares and/or ADSs to certain connected persons if and when appropriate and to comply with the HK Listing Rules, the Company proposes an ordinary resolution at the Annual Meeting to authorize the Company and its underwriters, in their sole discretion, to, in the Company’s securities offerings, allocate to each of the Existing Shareholders, up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the General Mandate to Issue Shares set forth in Proposal 6 for a period of five years, which period will be subject to an extension on a rolling basis each year, subject to the following conditions (the “Connected Person Placing Authorization I”):
(1)   the Company will put forward Proposals 6 and 7 to its shareholders in the next general meeting following the HKEx listing, which will be convened within four months after its listing (to clarify, this condition was satisfied in December 2018);
(2)   the Connected Person Placing Authorization I and the shareholder approval of the General Mandate to Issue Shares are not interdependent in that our shareholders may approve the General Mandate to Issue Shares without approving the Connected Person Placing Authorization I;
(3)   the Existing Shareholders shall abstain from voting on the Connected Person Placing Authorization I;
(4)   the Connected Person Placing Authorization I is only valid to the extent the Existing Shareholders individually hold less than 50% of the then-outstanding share capital of the Company;
(5)   any securities issued to the Existing Shareholders in an offering conducted pursuant to the General Mandate to Issue Shares shall be for cash consideration only and not as consideration for any acquisition;
(6)   none of the Existing Shareholders shall be entitled to have representatives on the committee of the Board of Directors responsible for determining the specific pricing of any offering;
(7)   apart from the potential pro rata allocation, the Existing Shareholders will subscribe for securities on the same terms and conditions as all other placees in any offering and none of the Existing Shareholders shall be entitled to any preferential treatment with respect to any offering conducted;
(8)   the Company will put forward Proposals 6 and 7 to its shareholders at each subsequent annual general meeting after its listing on the HKEx;
(9)   the Company remains listed on the NASDAQ; and
(10)   for clarity, in the event that the Company’s shareholders approve this Proposal 7 but fail to approve Proposal 8 (Connected Person Placing Authorization IA (for the Issue of RMB Shares)), the Company shall not be allowed to issue any shares or securities to the Existing Shareholders in connection with the Proposed Issue of RMB Shares pursuant to this Proposal 7.
 
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Proposal 7 is being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
Subject to the conditions above, if the Connected Person Placing Authorization I is approved at the Annual Meeting, the Company and its underwriters will be able to place, in the Company’s securities offerings, a pro rata amount of securities to the Existing Shareholders in connection with issuances of the Company’s shares under a general mandate approved by the Company’s shareholders, during a five-year period after the Annual Meeting, with such five-year period subject to an extension on a rolling basis at each subsequent annual general meeting of shareholders of the Company. The Board of Directors does not have any current plan to issue any new shares to the Existing Shareholders pursuant to the Connected Person Placing Authorization I.
As of April 1, 2021, the Existing Shareholders had the following interests or short positions in the shares or underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO. The beneficial ownership rules of the SFO and the HK Listing Rules differ from those of the SEC.
Name of Shareholder
Capacity / Nature of Interest
Number of
Shares/
Underlying
Shares
Approximate
Percentage of
Holding(1)
Julian C. Baker(2)
Beneficial owner/Interest in controlled corporations/Person having a security interest in shares 152,831,254 12.76%
Felix J. Baker(2)
Beneficial owner/Interest in controlled corporations/Person having a security interest in shares 152,831,254 12.76%
Baker Bros. Advisors (GP) LLC(2)
Investment manager/Other 152,368,107 12.73%
Baker Bros. Advisors LP(2)
Investment manager/Other 152,368,107 12.73%
Baker Brothers Life Sciences
Capital, L.P.(2)
Interest in controlled corporations/Other 141,217,049 11.79%
Hillhouse Capital Advisors, Ltd. (3)
Investment manager 133,587,655 11.16%
Gaoling Fund, L.P.(3)
Beneficial owner 129,433,059 10.81%
(1)
The calculation is based on the total number of 1,197,322,617 ordinary shares outstanding as of April 1, 2021, which included ordinary shares issued to the depositary in exchange for a corresponding amount of ADSs for the purposes of ensuring that it has ADSs readily available to satisfy the vesting of restricted share units and the exercise of share options under our equity incentive plans from time to time.
(2)
Julian C. Baker and Felix J. Baker are the managing members of Baker Bros. Advisors (GP) LLC. Baker Bros. Advisors (GP) LLC is the sole general partner of Baker Bros. Advisors LP, which is the investment advisor with sole voting and investment power to 667, L.P. and Baker Brothers Life Sciences, L.P. Also, Baker Brothers Life Sciences Capital, L.P. is the general partner of Baker Brothers Life Sciences, L.P. For the purposes of the SFO, Julian C. Baker, Felix J. Baker, Baker Bros. Advisors (GP) LLC and Baker Bros. Advisors LP are deemed to be interested in the 12,596,280 ordinary shares held by 667, L.P. and the 139,099,327 ordinary shares held by Baker Brothers Life Sciences, L.P. Each of Julian C. Baker and Felix J. Baker further holds 311,143 ordinary shares, and 151,004 ordinary shares through FBB3 LLC, a controlled corporation. Michael Goller and Ranjeev Krishana, members of the Board of Directors, are, respectively, a Partner and Head of International Investments of Baker Bros. Advisors LP, affiliates of which collectively hold more than 5% of our voting securities.
(3)
(i) 133,587,655 ordinary shares are held by Gaoling Fund, L.P. and YHG Investment, L.P.; and (iii) 13,447,603 ordinary shares are held by Hillhouse BGN Holdings Limited. Hillhouse Capital Advisors, Ltd. acts as the sole general partner of YHG Investment, L.P. and the sole management company of Gaoling Fund, L.P. Hillhouse Capital Management, Ltd. is the sole management company of Hillhouse Fund II, L.P., which owns Hillhouse BGN Holdings Limited. Under the SFO, Hillhouse
 
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Capital Advisors, Ltd. is deemed to be interested in the 133,587,655 ordinary shares held by Gaoling Fund, L.P. and YHG Investment, L.P. and Hillhouse Capital Management, Ltd. is deemed to be interested in the 13,447,603 ordinary shares held by Hillhouse BGN Holdings Limited. Under the SFO, Hillhouse Fund II, L.P. is deemed to be interested in the 13,447,603 ordinary shares held by Hillhouse BGN Holdings Limited. Qingqing Yi, a member of the Board of Directors, is a Partner at Hillhouse Capital, affiliates of which collectively hold more than 5% of our voting securities.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 7 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding the Existing Shareholders, which are required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 7 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the
Connected Person Placing Authorization I.
 
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PROPOSAL 8
CONNECTED PERSON PLACING AUTHORIZATION IA (FOR THE ISSUE OF RMB SHARES)
The Board of Directors approved a preliminary proposal for the possible issue of RMB Shares to be listed on STAR Market of the SSE, i.e., the Proposed Issue of RMB Shares. The Proposed Issue of RMB Shares is conditioned upon and subject to, among other things, approval by the shareholders of Proposals 6 and 16 at the Annual Meeting, market conditions, and the receipt of necessary regulatory approvals, and thus may or may not proceed. Shareholders and potential investors of the Company should be aware that there is no assurance that the Proposed Issue of RMB Shares will materialize or as to when it may materialize. For additional information regarding the Proposed Issue of RMB Shares, please refer to the Company’s Current Report on Form 8-K dated January 29, 2021 filed with the SEC and announcements dated January 29, 2021 and April    , 2021 filed with the HKEx.
The Company proposes an ordinary resolution at the Annual Meeting to authorize the Company and its underwriters, in their sole discretion, to, in the Proposed Issue of RMB Shares, allocate to each of the Existing Shareholders, up to a maximum amount of shares in order to maintain the same shareholding percentage of each of the Existing Shareholders (based on then-outstanding share capital of the Company) before and after the Proposed Issue of RMB Shares pursuant to the General Mandate to Issue Shares set forth in Proposal 6, subject to the following conditions (the “Connected Person Placing Authorization IA (for the Issue of RMB Shares)”):
(1)   the Existing Shareholders shall abstain from voting on the Connected Person Placing Authorization IA (for the Issue of RMB Shares);
(2)   the Connected Person Placing Authorization IA (for the Issue of RMB Shares) is only valid to the extent the Existing Shareholders individually hold less than 50% of the then-outstanding share capital of the Company;
(3)   any securities issued to the Existing Shareholders in the Proposed Issue of RMB Shares conducted pursuant to the General Mandate to Issue Shares shall be for cash consideration only and not as consideration for any acquisition;
(4)   none of the Existing Shareholders shall be entitled to have representatives on the committee of the Board of Directors responsible for determining the specific pricing for the Proposed Issue of RMB Shares;
(5)   apart from the potential pro rata allocation, the Existing Shareholders will subscribe for RMB Shares on the same terms and conditions as all other placees in the Proposed Issue of RMB Shares and none of the Existing Shareholders shall be entitled to any preferential treatment with respect to the Proposed Issue of RMB Shares; and
(6)   the Company remains listed on the NASDAQ.
Based on the Board of Directors’ current plan to issue no more than 132,313,549 RMB Shares and assuming no change in their shareholding between April   , 2021 and the closing of the Proposed Issue of RMB Shares, Baker Bros. Advisors LP and Hillhouse Capital Management, Ltd. (including parties affiliated with each of them) might subscribe for a maximum of        RMB Shares and        RMB Shares, respectively, pursuant to the Connected Person Placing Authorization IA (for the Issue of RMB Shares). Proposal 8 is being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 8 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding the Existing Shareholders, which are required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 8 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the Connected Person Placing Authorization IA (for the Issue of RMB Shares).
 
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PROPOSAL 9
CONNECTED PERSON PLACING AUTHORIZATION II
On October 31, 2019, the Company and its wholly-owned subsidiary BeiGene Switzerland GmbH entered into a Collaboration Agreement with Amgen to collaborate on the commercialization of certain products of Amgen in the PRC and the clinical development of certain pipeline products of Amgen (the “Collaboration Agreement”). On January 2, 2020, the Company issued 206,635,013 ordinary shares in the form of 15,895,001 ADSs of the Company, representing approximately 20.5% of the Company’s then outstanding share capital, to Amgen for aggregate gross proceeds of US$2.78 billion, or US$13.45 per ordinary share, or US$174.85 per ADS, pursuant to the Share Purchase Agreement dated October 31, 2019, as amended by Amendment No. 1 dated December 6, 2019, by and between the Company and Amgen (collectively, the “Share Purchase Agreement”). On March 17, 2020, the Company entered into a further amendment, which was amended and restated on September 24, 2020 (the “Restated Second Amendment”), to amend the Share Purchase Agreement, pursuant to which Amgen will have an option (the “Direct Purchase Option”) to subscribe for additional shares of the Company (the “Additional Shares”) under a specific mandate (the “Specific Mandate”), in an amount necessary to enable it to increase (and subsequently maintain) its ownership at approximately 20.6% of the Company’s outstanding share capital. The Restated Second Amendment and the issuance of Additional Shares thereunder under the Specific Mandate were approved by a majority vote of the Company’s shareholders, excluding Amgen, pursuant to the HK Listing Rules, at an extraordinary general meeting of the shareholders held on November 20, 2020. The Company plans to seek further approvals from independent shareholders at each subsequent annual general meeting during the remaining term of the Restated Second Amendment for the issuance of Additional Shares thereunder as further described under Proposal 11.
It is important to Amgen to be able to maintain an equity interest exceeding 20% of the Company’s outstanding share capital to ensure that it can continue to account for its interest in the Company using the equity method of accounting under US GAAP. If Amgen is unable to maintain an interest that permits it to account for its investment in the Company using the equity method of accounting, it is permitted under the Share Purchase Agreement to dispose of its shares until its interest reaches 10% of the outstanding share capital of the Company, which may have a material adverse effect on the Company and the trading price of the Company’s securities.
Additionally, the Company expects that the transaction with Amgen will provide both potential short-term and long-term financial benefits to the Company. Given the highly technical nature of the biotech industry, it is often difficult for retail (and even most institutional) investors to fully understand information released by biotech companies relating to the significant events after which offerings of securities are typically conducted. Many investors also look to increase their percentage holdings in companies as risk profiles go down through clinical development; ultimately, they often do this through participation in primarily follow-on financings. As such, participation by leading biotech companies is instrumental in giving retail and other institutional investors the assurance and comfort to make, and continue to make, investments into biotech companies.
In connection with the collaboration with Amgen, in 2019, the Company applied for, and the HKEx granted, a waiver (the “Amgen Waiver”) from strict compliance with Rule 13.36(1) of the HK Listing Rules and the independent shareholder approval requirements set out in Chapter 14A of the HK Listing Rules in respect of the Connected Person Placing Authorization II (as defined below).
In order to give the Company the flexibility to issue ordinary shares and/or ADSs to certain connected persons if and when appropriate and to comply with the HK Listing Rules, the Company proposes an ordinary resolution at the Annual Meeting to authorize the Company and its underwriters, in their sole discretion, to, in the Company’s securities offerings, allocate to Amgen, up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on the then-outstanding share capital of the Company) before and after the allocation of the corresponding securities issued pursuant to an offering conducted pursuant to the General Mandate to Issue Shares set forth in Proposal 6 for a period of five years, which period will be subject to an extension on a rolling basis each year, subject to the following conditions (the “Connected Person Placing Authorization II”):
 
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(1)   the Connected Person Placing Authorization II and the shareholder approval of the General Mandate to Issue Shares are not interdependent in that our shareholders may approve the General Mandate to Issue Shares without approving the Connected Person Placing Authorization II;
(2)   Amgen shall abstain from voting on the Connected Person Placing Authorization II;
(3)   the Connected Person Placing Authorization II is only valid to the extent Amgen individually holds less than 50% of the then-outstanding share capital of the Company;
(4)   any securities issued to Amgen in an offering conducted pursuant to the General Mandate to Issue Shares shall be for cash consideration only and not as consideration for any acquisition;
(5)   Amgen shall not be entitled to have representatives on the committee of the Board of Directors responsible for determining the specific pricing of any offering;
(6)   apart from the potential pro rata allocation, Amgen will subscribe for securities on the same terms and conditions as all other placees in any offering and Amgen shall not be entitled to any preferential treatment with respect to any offering conducted;
(7)   the Company will put forward Proposals 6 and 9 to its shareholders at each subsequent annual general meeting;
(8)   the Company shall disclose the Amgen Waiver in the proxy statement for each subsequent annual general meeting;
(9)   the Company remains listed on the NASDAQ; and
(10)   for clarity, in the event that the Company’s shareholders approve this Proposal 9 but fail to approve Proposal 10 (Connected Person Placing Authorization IIA (for the Issue of RMB Shares)), the Company shall not be allowed to issue any shares or securities to Amgen in connection with the Proposed Issue of RMB Shares pursuant to this Proposal 9.
Proposal 9 is being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
Subject to the conditions above, if the Connected Person Placing Authorization II is approved at the Annual Meeting, the Company and its underwriters will be able to place, in the Company’s securities offerings, a pro rata amount of securities to Amgen in connection with issuances of the Company’s shares under a general mandate approved by the Company’s shareholders, during a five-year period after the Annual Meeting, with such five-year period subject to an extension on a rolling basis at each subsequent annual general meeting of shareholders of the Company. The Board of Directors does not have any current plan to issue any new shares to Amgen pursuant to the Connected Person Placing Authorization II.
As of April 1, 2021, Amgen had the following interests or short positions in the shares or underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO. The beneficial ownership rules of the SFO and the HK Listing Rules differ from those of the SEC.
Name of Shareholder
Capacity / Nature of Interest
Number of
Shares/
Underlying
Shares
Approximate
Percentage of
Holding(1)
Amgen Inc.
Beneficial owner 244,117,549 20.39%
(1)
The calculation is based on the total number of 1,197,322,617 ordinary shares outstanding as of April 1, 2021, which included ordinary shares issued to the depositary in exchange for a corresponding amount of ADSs for the purposes of ensuring that it has ADSs readily available to satisfy the vesting of restricted share units and the exercise of share options from time to time.
 
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Vote Required and Board of Directors’ Recommendation
Approval of Proposal 9 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Amgen, which is required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 9 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the Connected Person Placing Authorization II.
 
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PROPOSAL 10
CONNECTED PERSON PLACING AUTHORIZATION IIA (FOR THE ISSUE OF RMB SHARES)
The Board of Directors approved a preliminary proposal for the possible issue of RMB Shares to be listed on the STAR Market of the SSE, i.e., the Proposed Issue of RMB Shares. The Proposed Issue of RMB Shares is conditioned upon and subject to, among other things, approval by the shareholders of Proposals 6 and 16 at the Annual Meeting, market conditions, and the receipt of necessary regulatory approvals, and thus may or may not proceed. Shareholders and potential investors of the Company should be aware that there is no assurance that the Proposed Issue of RMB Shares will materialize or as to when it may materialize. For additional information regarding the Proposed Issue of RMB Shares, please refer to the Company’s Current Report on Form 8-K dated January 29, 2021 filed with the SEC and announcements dated January 29, 2021 and April    , 2021 filed with the HKEx.
The Company proposes an ordinary resolution at the Annual Meeting to authorize the Company and its underwriters, in their sole discretion, to, in the Proposed Issue of RMB Shares, allocate to Amgen, up to a maximum amount of shares in order to maintain the same shareholding percentage of Amgen (based on then-outstanding share capital of the Company) before and after the Proposed Issue of RMB Shares pursuant to the General Mandate to Issue Shares set forth in Proposal 6, subject to the following conditions (the “Connected Person Placing Authorization IIA (for the Issue of RMB Shares)”):
(1)   Amgen shall abstain from voting on the Connected Person Placing Authorization IIA (for the Issue of RMB Shares);
(2)   the Connected Person Placing Authorization IIA is only valid to the extent Amgen holds less than 50% of the then-outstanding share capital of the Company;
(3)   any securities issued to Amgen in the Proposed Issue of RMB Shares conducted pursuant to the General Mandate to Issue Shares shall be for cash consideration only and not as consideration for any acquisition;
(4)   Amgen shall not be entitled to have representatives on the committee of the Board of Directors responsible for determining the specific pricing for the Proposed Issue of RMB Shares;
(5)   apart from the potential pro rata allocation, Amgen will subscribe for RMB Shares on the same terms and conditions as all other placees in the Proposed Issue of RMB Shares and Amgen shall not be entitled to any preferential treatment with respect to the Proposed Issue of RMB Shares; and
(6)   the Company remains listed on the NASDAQ.
Based on the Board of Directors’ current plan to issue no more than 132,313,549 RMB Shares and assuming no change in its shareholding between April    , 2021 and the closing of the Proposed Issue of RMB Shares, Amgen might subscribe for a maximum of       RMB Shares pursuant to the Connected Person Placing Authorization IIA (for the Issue of RMB Shares). Proposal 10 is being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 10 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Amgen, which is required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 10 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the Connected Person Placing Authorization IIA (for the Issue of RMB Shares).
 
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PROPOSAL 11
APPROVAL OF AMGEN’S DIRECT PURCHASE OPTION
The Company proposes an ordinary resolution at the Annual Meeting to approve the grant of an option to acquire shares to Amgen to allow Amgen to subscribe for Additional Shares under the Specific Mandate in an amount necessary to enable it to increase (and subsequently maintain) its ownership at approximately 20.6% of the Company’s outstanding share capital, up to an aggregate of 75,000,000 ordinary shares during the option term, pursuant to the terms of the Restated Second Amendment. The purchase price for the Additional Shares will be determined by the volume-weighted average price of the Company’s ADSs on NASDAQ for the 90 days preceding the last trading day of the prior month. The Additional Shares shall be allotted and issued under the Specific Mandate. The Company has applied for, and the HKEx has granted, a waiver from Rules 13.36(1)(a) and 14A.36 of the HK Listing Rules in respect of the Direct Purchase Option based on the Company’s funding needs and subject to following conditions:
1)
the Direct Purchase Option will be exercisable by Amgen solely as a result of dilution arising from issuance of new shares by the Company under its equity incentive plans from time to time (including for the avoidance of doubt securities that may be issued pursuant to the Company’s option agreements with Mr. John V. Oyler and Dr. Xiaodong Wang);
2)
the Direct Purchase Option is subject to annual approval by the Company’s independent shareholders each year during the term of the Restated Second Amendment;
3)
the Company will disclose in the relevant annual general meeting circulars (i) the number of times of Amgen exercised the Direct Purchase Option during the preceding year; (ii) the number of shares acquired by Amgen as a result of such exercises; and (iii) the weighted average price of the shares acquired by Amgen under the Direct Purchase Option during the preceding year; and
4)
the Company will disclose details of the waiver in an announcement and the circular for the extraordinary general meeting convened to consider and, if thought fit, approve the Direct Purchase Option (for clarity, this condition was satisfied in November 2020).
The Restated Second Amendment and the issuance of Additional Shares under the Specific Mandate were approved by a majority vote of the Company’s shareholders, excluding Amgen, pursuant to the HK Listing Rules, at an extraordinary general meeting of the shareholders held on November 20, 2020.
During 2020, Amgen did not exercise the Direct Purchase Option.
Why We Need Shareholder Approval
We are seeking shareholder approval in order to comply with Chapter 14A of the HK Listing Rules and to obtain the Specific Mandate under which the Additional Shares will be allotted and issued pursuant to the Restated Second Amendment. Amgen is a substantial shareholder of the Company under the HK Listing Rules and therefore a connected person of the Company under Chapter 14A of the HK Listing Rules. As a result, the transactions contemplated under the Restated Second Amendment constitute a connected transaction of the Company under Chapter 14A of the HK Listing Rules. The transactions contemplated under the Restated Second Amendment are subject to the reporting, announcement and independent shareholders’ approval requirements under Chapter 14A of the HK Listing Rules.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 11 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Amgen, which is required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 11 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the grant of an option to Amgen to subscribe for Additional Shares pursuant to the terms of the Restated Second Amendment and of the Specific Mandate.
 
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PROPOSALS 12 – 14
PROPOSED GRANTS OF RESTRICTED SHARE UNITS TO DIRECTORS
Proposals 12 through 14 are being submitted for shareholder approval as required by and in compliance with the HK Listing Rules.
LETTER FROM THE BOARD OF DIRECTORS
April   , 2021
To the Shareholders
Dear Sir or Madam,
PROPOSED GRANTS OF RESTRICTED SHARE UNITS TO DIRECTORS
INTRODUCTION
Reference is made to the announcement of BeiGene, Ltd. (the “Company”) dated April   , 2021 in relation to the proposed restricted share unit (“RSU”) grants to the named directors and executive (the “Proposed RSU Grants”).
The purpose of this letter is to provide you with (1) further information in relation to the Proposed RSU Grants; (2) letters from the Independent Board Committees; (3) a letter from the Independent Financial Adviser; and (4) other information as required under the HK Listing Rules.
THE PROPOSED RSU GRANTS
Subject to acceptance and the independent shareholders’ approval, the Board of Directors resolved that it will grant the following Proposed RSU Grants under the Second Amended and Restated 2016 Share Option and Incentive Plan (as amended, the “2016 Plan”), on the date of the 2021 annual general meeting of shareholders (the “Annual Meeting”) (i.e., June 16, 2021):

RSUs with a grant date fair value of US$3,750,000 to Mr. John V. Oyler, entitling Mr. Oyler to receive a maximum of an estimated 158,366 ordinary shares (the “indicative number of Oyler RSUs”) upon full vesting, representing approximately 0.01% of the total number of issued shares as of April 1, 2021 (the “Latest Practicable Date”). The indicative number of Oyler RSUs is calculated for indicative purposes using the closing price of US$307.81 per American Depositary Share of the Company (“ADS”) on NASDAQ (or US$23.68 per ordinary share) on the assumed grant date which is April 15, 2021 (the “Assumed Grant Date Price”). The actual number of shares to be issued will be calculated using the closing price on the grant date;

RSUs with a grant date fair value of US$1,000,000 to Dr. Xiaodong Wang, entitling Dr. Wang to receive a maximum of an estimated 42,224 ordinary shares (the “indicative number of Wang RSUs”) upon full vesting, representing approximately 0.004% of the total number of issued shares as of the Latest Practicable Date. The indicative number of Wang RSUs is calculated for indicative purposes using the Assumed Grant Date Price. The actual number of shares to be issued will be calculated using the closing price on the grant date;

RSUs with a grant date fair value of US$200,000 to each of other non-executive and independent non-executive directors, Mr. Anthony C. Hooper, Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi, each to receive a maximum of an estimated 8,437 ordinary shares (the “indicative number of non-executive and independent non-executive director RSUs”) upon full vesting, representing approximately 0.001% of the total number of issued shares as of the Latest Practicable Date. The indicative number of non-executive and independent non-executive director RSUs is calculated for indicative purposes using the Assumed Grant Date Price. The actual number of shares to be issued will be calculated using the closing price on the grant date;
 
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the final number of RSUs underlying each Proposed RSU Grant, which, for the avoidance of doubt, may be higher or lower than the indicative number of Oyler RSUs, the indicative number of Wang RSUs and the indicative number of non-executive and independent non-executive director RSUs (collectively, the “indicative number of RSUs”) set forth above, shall be calculated by dividing the grant value by the closing price of the ADSs on NASDAQ on the actual grant date which shall be the date of the Annual Meeting (i.e., June 16, 2021). The remaining number of shares available for future equity grants under the 2016 Plan as of the Latest Practicable Date was 65,835,236 and the Proposed RSU Grants will be subject to such limit; and

if the independent shareholders’ approval is not obtained by the date of the Annual Meeting, the respective Proposed RSU Grant shall be replaced by a share option grant with the same grant date value in accordance with Chapter 17 of the HK Listing Rules.
The Board of Directors resolved that it will grant the following share option grants under the 2016 Plan to Mr. Oyler, Mr. Wang and other non-executive and independent non-executive directors on the date of Annual Meeting (i.e., June 16, 2021), which are not subject to the independent shareholders’ approval but are subject to the relevant requirements under Chapter 17 of the HK Listing Rules:

share options with a grant date fair value of US$11,250,000 to Mr. Oyler. 25% of the ordinary shares subject to the share options shall become exercisable on the first anniversary of the grant date, and the balance shall become exercisable in 36 successive equal monthly installments thereafter, subject to continued service; provided, however, that upon a termination without cause or for good reason as defined in Mr. Oyler’s employment agreement, the option shall become exercisable for underlying shares as if he had remained employed for an additional 20 months; provided further that the option shall become exercisable for all underlying shares upon a change in control of the Company;

share options with a grant date fair value of US$3,000,000 to Dr. Wang. 25% of the ordinary shares subject to the share options shall become exercisable on the first anniversary of the grant date, and the balance shall become exercisable in 36 successive equal monthly installments thereafter, subject to continued service;

share options with a grant date fair value of US$200,000 to each of the other non-executive and independent non-executive directors. The share options shall vest in full on the earlier of the first anniversary of the grant date or the date of the next annual general meeting of shareholders; provided, however, that all vesting shall cease if the director resigns from the Board or otherwise ceases to serve as a director other than as set forth below or the Board determines that the circumstances warrant continuation of vesting. All options shall be exercisable for three years following cessation of service, and unvested options shall accelerate in full upon (i) death, (ii) disability, (iii) termination of service in connection with a change of control of the Company, or (iv) upon a change of control of the Company if the director’s service continues and the awards are not assumed by the acquiror at the time of the change of control; and

each share option will have an exercise price equal to the greater of (i) the fair market value of the Company’s ordinary shares on the date of grant and (ii) the average fair market value of the Company’s ordinary shares over the five trading days preceding the grant date, in each case as determined in reference to the closing price of the Company’s ADSs on the NASDAQ.
The Proposed RSU Grant to Mr. Oyler
The Proposed RSU Grant to Mr. Oyler will be made under the following terms:

each of the RSUs is granted for nil consideration;

each of the RSUs granted represents the right to receive one ordinary share on the date it vests; and

25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service; provided, however, that upon a termination without cause or for good reason as defined in Mr. Oyler’s employment agreement, the RSUs shall become vested as if he had remained employed for an additional 20 months; provided further that the RSUs shall become fully vested for underlying shares upon a change in control of the Company.
 
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The Proposed RSU Grant to Dr. Wang
The Proposed RSU Grant to Dr. Wang will be made under the following terms:

each of the RSUs is granted for nil consideration;

each of the RSUs granted represents the right to receive one ordinary share on the date it vests; and

25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service.
The Proposed RSU Grants to Other Non-Executive and Independent Non-Executive Directors
The Proposed RSU Grants to each of the other non-executive and independent non-executive directors will be made under the following terms:

each of the RSUs is granted for nil consideration;

each of the RSUs granted represents the right to receive one ordinary share on the date it vests;

100% of the ordinary shares shall vest upon the earlier to occur of the first anniversary of the grant date or the date of the next annual general meeting of shareholders; provided, however, that all vesting shall cease if the director resigns from the Board or otherwise ceases to serve as a director other than as set forth below or the Board determines that the circumstances warrant continuation of vesting. Unvested RSUs shall accelerate in full upon (i) death, (ii) disability, (iii) termination of service in connection with a change of control of the Company, or (iv) upon a change of control of the Company if the director’s service continues and the awards are not assumed by the acquiror at the time of the change of control. Subject to specific terms and conditions designed for compliance with applicable tax and other regulations, a director generally may elect to defer settlement of their RSUs until six months following the date that the director ceases to serve as a director;

notwithstanding the above, the number of RSUs to be vested on the vesting date shall not cause the total number of shares held legally or beneficially by each of the independent non-executive directors, together with the total number of shares which may be issued to each of them or their nominee upon the exercise of any outstanding share options, convertible securities and other rights (whether contractual or otherwise) to call for the issue of shares, to exceed 1% of the total number of issued shares at the vesting date after their vesting and issuance (the “1% threshold”); and

if the number of RSUs to be vested on the vesting date would cause the total number of shares held legally or beneficially by each of the independent non-executive directors, together with the total number of shares which may be issued to each of them or their nominee upon the exercise of any outstanding share options, convertible securities and other rights (whether contractual or otherwise) to call for the issue of shares, to exceed the 1% threshold, the final number of RSUs to be vested on the vesting date shall be the maximum number of shares that may be issued to the relevant grantee while keeping their respective shareholding below the 1% threshold.
HONG KONG LISTING RULES IMPLICATIONS
Mr. Oyler, Dr. Wang, Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi are directors. Therefore, they are connected persons of the Company, and each of the Proposed RSU Grants and transactions contemplated therein constitute non-exempt connected transactions of the Company under Chapter 14A of the HK Listing Rules and are subject to reporting, announcement and the independent shareholders’ approval requirements.
Mr. Oyler
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Oyler and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Oyler and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Oyler and his associates is not interested in any shares except Mr. Oyler’s interest in a total of 77,412,897 shares or underlying shares, representing approximately 6.47% of total number of
 
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issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Oyler and transactions contemplated therein. Accordingly, except for Mr. Oyler and any trustee, manager and director of the entities associated with him, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Oyler and transactions contemplated therein.
Except for Mr. Oyler, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Oyler and therefore none of them other than Mr. Oyler abstained from voting on the relevant board resolution.
Dr. Wang
Pursuant to Chapter 14A of the HK Listing Rules, each of Dr. Wang and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Dr. Wang and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Dr. Wang and his associates is not interested in any shares except Dr. Wang’s interest in a total of 20,968,574 shares or underlying shares, representing approximately 1.75% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Dr. Wang and transactions contemplated therein. Accordingly, except for Dr. Wang and any trustee and manager of the entities affiliated with him, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Dr. Wang and transactions contemplated therein.
Except for Dr. Wang, no other director is considered to have a material interest in the Proposed RSU Grant to Dr. Wang and therefore none of them other than Dr. Wang abstained from voting on the relevant board resolution.
Mr. Hooper
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Hooper and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Hooper and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Hooper and his associates is not interested in any shares except Mr. Hooper’s interest in a total of 67,353 shares or underlying shares, representing approximately 0.01% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Hooper and transactions contemplated therein. Accordingly, except for Mr. Hooper, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Hooper and transactions contemplated therein.
Except for Mr. Hooper, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Hooper and therefore none of them other than Mr. Hooper abstained from voting on the relevant board resolution.
Mr. Chen
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Chen and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Chen and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Chen and his associates is not interested in any shares except Mr. Chen’s interest in a total of 460,340 shares or underlying shares, representing approximately 0.04% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Chen and transactions contemplated therein. Accordingly, except for Mr. Chen,
 
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no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Chen and transactions contemplated therein.
Except for Mr. Chen, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Chen and therefore none of them other than Mr. Chen abstained from voting on the relevant board resolution.
Mr. Glazer
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Glazer and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Glazer and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Glazer and his associates is not interested in any shares except Mr. Glazer’s interest in a total of 3,155,247 shares or underlying shares, representing approximately 0.26% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Glazer and transactions contemplated therein. Accordingly, except for Mr. Glazer, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Glazer and transactions contemplated therein.
Except for Mr. Glazer, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Glazer and therefore none of them other than Mr. Glazer abstained from voting on the relevant board resolution.
Mr. Goller
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Goller and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Goller and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Goller and his associates is not interested in any shares except Mr. Goller’s interest in a total of 336,700 shares or underlying shares, representing approximately 0.03% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Goller and transactions contemplated therein. Accordingly, except for Mr. Goller, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Goller and transactions contemplated therein.
Except for Mr. Goller, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Goller and therefore none of them other than Mr. Goller abstained from voting on the relevant board resolution.
Mr. Krishana
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Krishana and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Krishana and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Krishana and his associates is not interested in any shares except Mr. Krishana’s interest in a total of 336,700 shares or underlying shares, representing approximately 0.03% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Krishana and transactions contemplated therein. Accordingly, except for Mr. Krishana, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Krishana and transactions contemplated therein.
 
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Except for Mr. Krishana, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Krishana and therefore none of them other than Mr. Krishana abstained from voting on the relevant board resolution.
Mr. Malley
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Malley and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Malley and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Malley and his associates is not interested in any shares except Mr. Malley’s interest in a total of 1,249,448 shares or underlying shares, representing approximately 0.10% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Malley and transactions contemplated therein. Accordingly, except for Mr. Malley, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Malley and transactions contemplated therein.
Except for Mr. Malley, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Malley and therefore none of them other than Mr. Malley abstained from voting on the relevant board resolution.
Dr. Sanders
Pursuant to Chapter 14A of the HK Listing Rules, each of Dr. Sanders and her associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Dr. Sanders and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Dr. Sanders and her associates is not interested in any shares except Dr. Sanders’ interest in a total of 27,482 shares or underlying shares, representing approximately 0.002% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Dr. Sanders and transactions contemplated therein. Accordingly, except for Dr. Sanders, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Dr. Sanders and transactions contemplated therein.
Except for Dr. Sanders, no other director is considered to have a material interest in the Proposed RSU Grant to Dr. Sanders and therefore none of them other than Dr. Sanders abstained from voting on the relevant board resolution.
Mr. Su
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Su and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Su and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Su and his associates is not interested in any shares except Mr. Su’s interest in a total of 173,277 shares or underlying shares, representing approximately 0.01% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Su and transactions contemplated therein. Accordingly, except for Mr. Su, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Su and transactions contemplated therein.
Except for Mr. Su, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Su and therefore none of them other than Mr. Su abstained from voting on the relevant board resolution.
 
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Mr. Yi
Pursuant to Chapter 14A of the HK Listing Rules, each of Mr. Yi and his associates is required to abstain from voting on the resolution at the Annual Meeting to approve the Proposed RSU Grant to Mr. Yi and transactions contemplated therein. To the best of the directors’ knowledge, information and belief: (i) each of Mr. Yi and his associates is not interested in any shares except Mr. Yi’s interest in a total of 327,418 shares or underlying shares, representing approximately 0.03% of total number of issued shares as of the Latest Practicable Date, as notified to the Company and the HKEx pursuant to Divisions 7 and 8 of Part XV of the SFO; and (ii) there are no other shareholders having any material interest in the Proposed RSU Grant to Mr. Yi and transactions contemplated therein. Accordingly, except for Mr. Yi, no shareholders are required under the HK Listing Rules to abstain from voting at the Annual Meeting on the resolution approving the Proposed RSU Grant to Mr. Yi and transactions contemplated therein.
Except for Mr. Yi, no other director is considered to have a material interest in the Proposed RSU Grant to Mr. Yi and therefore none of them other than Mr. Yi abstained from voting on the relevant board resolution.
REASONS AND RATIONALE FOR THE PROPOSED RSU GRANTS
Purpose of the 2016 Plan and the Proposed RSU Grants
The 2016 Plan provides the Company with flexibility to use various equity-based incentives and other awards as compensation tools to motivate and reward the Company’s employees, directors and consultants. For further details of the 2016 Plan, please refer to the Company’s Proxy Statement/Circular dated April 28, 2020.
The Proposed RSU Grant to Mr. Oyler is part of the Company’s compensation program for employees, including executive officers. The purpose of such grant is to encourage executives and other employees to focus on long-term company performance and align their interests with shareholders, promote retention and reward outstanding company and individual performance. The Proposed RSU Grant to Mr. Oyler aims to provide sufficient incentive to retain and motivate Mr. Oyler to participate in the formulation of strategy and long-term development of the Company and to recognize his contribution to the growth of the Company. In this regard, the directors (including independent non-executive directors but excluding Mr. Oyler) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Oyler are fair and reasonable and in the best interests of the Company and the shareholders as a whole.
The Proposed RSU Grant to Dr. Wang is part of the Company’s compensation package for Dr. Wang to serve as Chair of the Scientific Advisory Board. Dr. Wang’s consulting services include leading the Scientific Advisory Board and providing short- and long-term strategic advice to the Company in his areas of expertise, participating in our leadership team meetings from time to time, and interacting with our key stakeholders on behalf of the Company. Through these and other contributions, Dr. Wang has helped us make significant progress on our research, development and business goals. The Proposed RSU Grant to Dr. Wang aims to provide sufficient incentive to retain and motivate Dr. Wang to participate in the formulation of strategy and long-term development of the Company and to recognize his contribution to the growth of the Company. In this regard, the directors (including independent non-executive directors but excluding Dr. Wang) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Dr. Wang are fair and reasonable and in the best interests of the Company and the shareholders as a whole.
The Proposed RSU Grants to other non-executive and independent non-executive directors are part of the Company’s compensation package to the non-executive and independent non-executive directors. The Proposed RSU Grants to other non-executive and independent non-executive directors aim to retain and motivate the non-executive and independent non-executive directors to continue to provide their opinion and judgment to the Board of Directors in building the strategy and long-term development of the Company. In this regard, (i) the directors (including independent non-executive directors but excluding Mr. Hooper) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Hooper are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (ii) the directors (including independent non-executive directors but excluding Mr. Chen) and the Compensation Committee (excluding Mr. Chen) consider that the terms of the Proposed RSU Grant to Mr. Chen are fair and reasonable
 
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and in the best interests of the Company and the shareholders as a whole; (iii) the directors (including independent non-executive directors but excluding Mr. Glazer) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Glazer are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (iv) the directors (including independent non-executive directors but excluding Mr. Goller) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Goller are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (v) the directors (including independent non-executive directors but excluding Mr. Krishana) and the Compensation Committee (excluding Mr. Krishana) consider that the terms of the Proposed RSU Grant to Mr. Krishana are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (vi) the directors (including independent non-executive directors but excluding Mr. Malley) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Malley are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (vii) the directors (including independent non-executive directors but excluding Dr. Sanders) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Dr. Sanders are fair and reasonable and in the best interests of the Company and the shareholders as a whole; (viii) the directors (including independent non-executive directors but excluding Mr. Su) and the Compensation Committee consider that the terms of the Proposed RSU Grant to Mr. Su are fair and reasonable and in the best interests of the Company and the shareholders as a whole; and (ix) the directors (including independent non-executive directors but excluding Mr. Yi) and the Compensation Committee (excluding Mr. Yi) consider that the terms of the Proposed RSU Grant to Mr. Yi are fair and reasonable and in the best interests of the Company and the shareholders as a whole.
Rationale of the Proposed RSU Grants
The Proposed RSU Grant to Mr. Oyler
Background and contribution of Mr. Oyler
The Board of Directors proposed to compensate Mr. Oyler with the Proposed RSU Grant after considering Mr. Oyler’s integral role as Co-Founder, Chief Executive Officer and Chairman of the Board, his extensive leadership, executive, managerial, business and biotechnology company experience, his years of industry experience in the development of pharmaceutical products and contribution to the rapid growth of the Company.
Mr. Oyler is our Co-Founder, Chief Executive Officer and Chairman of the Board. He has served as a member of the Board of Directors since October 2010. From 2005 to 2009, Mr. Oyler served as President and Chief Executive Officer of BioDuro, LLC, a drug discovery outsourcing company, which was acquired by Pharmaceutical Product Development Inc. From 2002 to 2004, Mr. Oyler served as Chief Executive Officer of Galenea Corp., a biopharmaceutical company dedicated to the discovery of novel therapies for central nervous system diseases, which initially were developed at Massachusetts Institute of Technology. From 1998 to 2002, Mr. Oyler was a Founder and the President of Telephia, Inc. which was bought by The Nielsen Company in 2007. From 1997 to 1998, Mr. Oyler served as Co-Chief Executive Officer of Genta Incorporated, an oncology-focused biopharmaceutical company that was listed on the NASDAQ. Mr. Oyler began his career as a management consultant at McKinsey & Company. Mr. Oyler received his B.S. from the Massachusetts Institute of Technology in June 1990 and an MBA from Stanford University in January 1996.
Retention and recognition of Mr. Oyler
The Board of Directors considered the retention and motivation of Mr. Oyler are indispensable to the senior management of the Company. We maintain an industry-specific peer group of publicly traded companies in the biopharmaceutical and biotechnology industries that is selected based on a balance of criteria, such as the size of the company, the stage of development and data availability, for benchmarking pay. The value of RSUs to be granted to Mr. Oyler was determined by the Board of Directors upon recommendation of the Compensation Committee by referencing the equity grant practices of our compensation peer group. As further discussed under the heading of “Executive Compensation”, the Board of Directors and/or the Compensation Committee generally positions target total compensation for our
 
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executive officers above the median target total compensation in our peer group, with target total cash compensation, including base salaries and target annual incentives, at or below the 25th percentile and equity incentive awards above the median in order to link compensation more closely with corporate performance and the creation of shareholder value.
The Proposed RSU Grant to Dr. Wang
Background and contribution of Dr. Wang
The Board of Directors proposed to compensate Dr. Wang with the Proposed RSU Grant after considering Dr. Wang’s critical role as Chair of the Scientific Advisory Board, his extensive experience in cancer drug research and in the biotechnology industry and contribution to the rapid growth of the Company.
Dr. Wang is our Co-Founder and has served as a member of the Board of Directors since February 2016. He has also served as the Chairman of our Scientific Advisory Board since 2011. Dr. Wang has served as the founding Director of the National Institute of Biological Sciences in Beijing since 2003 and became its Director and Investigator in 2010. In addition, Dr. Wang has served as a Chair Professor at Tsinghua University since 2020. Previously, he was a Howard Hughes Medical Institute Investigator from 1997 to 2010 and held the position of the George L. MacGregor Distinguished Chair Professor in Biomedical Sciences at the University of Texas Southwestern Medical Center in Dallas, Texas from 2001 to 2010. In 2004, Dr. Wang founded Joyant Pharmaceuticals, Inc., a venture capital-backed biotechnology company focused on the development of small molecule therapeutics for cancer. Dr. Wang received his B.S. in Biology from Beijing Normal University in July 1984 and his Ph.D. in Biochemistry from the University of Texas Southwestern Medical Center in May 1991. Dr. Wang has been a member of the National Academy of Sciences, USA since 2004 and a foreign associate of the Chinese Academy of Sciences since 2013.
Dr. Wang’s consulting services include leading the Scientific Advisory Board and providing short- and long-term strategic advice to our Company in his areas of expertise, participating in our leadership team meetings from time to time, and interacting with our key stakeholders on behalf of the Company.
Retention and recognition of Dr. Wang
The Board of Directors believes that Dr. Wang’s stature in the Chinese scientific and biotechnology communities provides the Company with significant intangible benefits and access to key stakeholders in our industry. His scientific expertise and knowledge of oncology research and development and the Chinese market are highly valuable to the Company. The value of RSUs to be granted to Dr. Wang was determined by the Board of Directors upon recommendation of the Compensation Committee to reflect his major contributions to the Company.
The Proposed RSU Grants to Other Non-Executive and Independent Non-Executive Directors
Background and contribution of other non-executive and independent non-executive directors
The Board of Directors proposed to compensate the non-executive and independent non-executive directors with the Proposed RSU Grants to non-executive and independent non-executive directors in light of the continued progress of the Company and after considering each of the non-executive and independent non-executive directors’ contribution to the Company through providing their opinion and judgment, as well as the background and experience of each of the non-executive and independent non-executive directors. Please refer to the section headed “Election of Directors” in this Proxy Statement for details regarding the biography and background of each non-executive and independent non-executive director.
Rationale of the Proposed RSU Grants to other non-executive and independent non-executive directors
The Proposed RSU Grants to other non-executive and independent non-executive directors are part of the compensation package to the non-executive and independent non-executive directors under the Amended Independent Director Compensation Policy and have been approved by the Board of Directors upon recommendation of the Compensation Committee. The Proposed RSU Grants are granted in light of the
 
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continued progress and performance of the Company and aim to retain and motivate the non-executive and independent non-executive directors to continue to provide their opinion and judgment to the Board of Directors in building the strategy and long-term development of the Company. Please refer to the section headed “Director Compensation” in this Proxy Statement for details regarding the overall compensation arrangements of non-executive and independent non-executive directors.
The value of RSUs to be granted to the non-executive and independent non-executive directors was determined by the Board of Directors upon recommendation of the Compensation Committee by referencing the equity grant practices of our compensation peer group.
Dilution effect
Assuming each of the directors becomes fully entitled to all shares underlying the Proposed RSU Grants and based on the indicative number of RSUs set forth above, the total number of such underlying shares would amount to 276,523 ordinary shares, or approximately 0.02% of the total number of issued shares as of the Latest Practicable Date, and such shares will represent 0.02% of the total number of issued shares upon completion of issue.
The shareholding structure of the Company before and after each of the directors becomes fully entitled to all of the shares underlying the Proposed RSU Grants is summarized as follows (calculated assuming the indicative number of RSUs set forth above and based on the total number of issued shares as of the Latest Practicable Date):
Latest Practicable Date(1)
Assuming full vesting of the
Proposed RSU Grants(2)
No. of shares
%(3)
No. of shares
%
Mr. Oyler
77,412,897(4) 6.47% 77,571,263 6.48%
Dr. Wang
20,968,574(5) 1.75% 21,010,798 1.75%
Mr. Hooper
67,353(6) 0.01% 75,790 0.01%
Mr. Chen
460,340(7) 0.04% 468,777 0.04%
Mr. Glazer
3,155,247(8) 0.26% 3,163,684 0.26%
Mr. Goller
336,700(9) 0.03% 345,137 0.03%
Mr. Krishana
336,700(10) 0.03% 345,137 0.03%
Mr. Malley
1,249,448(11) 0.10% 1,257,885 0.11%
Dr. Sanders
27,482(12) 0.002% 35,919 0.003%
Mr. Su
173,277(13) 0.01% 181,714 0.02%
Mr. Yi
327,418(14) 0.03% 335,855 0.03%
Other Shareholders
1,092,807,181 91.27% 1,092,807,181 91.25%
Total
1,197,322,617 100% 1,197,599,140 100%
(1)
Assuming that no shares are issued pursuant to any of the Proposed RSU Grants.
(2)
Without taking into account Shares which may be repurchased or issued by the Company (except for the Proposed RSU Grants).
(3)
The calculation is based on the total number of 1,197,322,617 ordinary shares in issue as of the Latest Practicable Date, which included ordinary shares issued to the depositary in exchange for a corresponding amount of ADSs for the purposes of ensuring that it has ADSs readily available to satisfy the vesting of restricted share units and the exercise of share options from time to time.
(4)
Includes (i) 7,871,562 Shares held by Mr. Oyler, (ii) Mr. Oyler’s entitlement to receive up to 20,705,156 Shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options, and (iii) Mr. Oyler’s entitlement to restricted share units equivalent to 510,411 Shares, subject to vesting conditions; (iv) 10,000,000 ordinary shares held for the benefit of Mr. Oyler in a Roth IRA PENSCO trust account; (v) 102,188 ordinary shares held by The John Oyler Legacy Trust, of which Mr. Oyler’s father is a trustee, for the benefit of his minor child, in which Mr. Oyler
 
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is deemed to be interested for the purpose of the SFO; (vi) 7,727,927 ordinary shares held for the benefit of Mr. Oyler in a grantor retained annuity trust, of which Mr. Oyler’s father is a trustee, in which Mr. Oyler is deemed to be interested for the purpose of the SFO; (vii) 29,439,115 ordinary shares held by Oyler Investment LLC, 99% of the limited liability company interest owned by a grantor retain annuity trust, in which Mr. Oyler’s father is a trustee, in which Mr. Oyler is deemed to be interested for the purpose of the SFO; (viii) 510,941 ordinary shares held by The Oyler Family Legacy Trust for the benefit of Mr. Oyler’s family members, of which Mr. Oyler’s father is a trustee and Mr. Oyler is the settlor; and (ix) 545,597 held by the P&O Trust, the beneficiaries of which include Mr. Oyler’s minor child and others, in which Mr. Oyler is deemed to be interested for the purpose of the SFO.
(5)
Includes (i) 6,798,107 Shares held by Dr. Wang, (ii) Dr. Wang’s entitlement to receive up to 9,594,450 Shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options, and (iii) Dr. Wang’s entitlement to restricted share units equivalent to 149,597 Shares, subject to vesting conditions; (iv) 50 ordinary shares held by Dr. Wang’s spouse; (v) 172,372 ordinary shares held in a UTMA account for Dr. Wang’s minor child, in which Dr. Wang is deemed to be interested for the purpose of the SFO; and (vi) 4,253,998 ordinary shares held by Wang Investment LLC, of which 99% of the limited liability company interest is owned by two grantor retained annuity trusts, of which Dr. Wang’s wife is a trustee, in which Dr. Wang is deemed to be interested for the purpose of the SFO.
(6)
Includes Mr. Hooper’s entitlement to receive up to 67,353 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(7)
Includes Mr. Chen’s entitlement to receive up to 460,340 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(8)
Includes (i) 2,907,829 ordinary shares held by Mr. Glazer; and (ii) Mr. Glazer’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(9)
Includes (i) 9,282 ordinary shares held by Mr. Goller; and (ii) Mr. Goller’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(10)
Includes (i) 9,282 ordinary shares held by Mr. Krishana and (ii) Mr. Krishana’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(11)
Includes (i) 399,282 ordinary shares held by Mr. Malley and (ii) Mr. Malley’s entitlement to receive up to 850,166 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(12)
Includes Dr. Sanders is entitled to receive up to 27,482 ordinary shares pursuant to the exercise of options granted to her, subject to the conditions (including vesting conditions) of those options.
(13)
Includes Mr. Su is entitled to receive up to 173,277 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(14)
Includes Mr. Yi’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
Board of Directors’ Views
Given that the directors believe that the Proposed RSU Grants will retain, motivate and incentivize the grantees and will benefit the long-term development of the Company, the directors consider that the terms of the Proposed RSU Grants are fair and reasonable and in the interests of the shareholders as a whole.
Independent Board Committees and Independent Financial Adviser
Independent Board Committee A, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper.
 
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Independent Board Committee B, comprising Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Chen.
Independent Board Committee C, comprising Mr. Chen, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Glazer.
Independent Board Committee D, comprising Mr. Chen, Mr. Glazer, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Goller.
Independent Board Committee E, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Krishana.
Independent Board Committee F, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Malley.
Independent Board Committee G, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Dr. Sanders.
Independent Board Committee H, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Su.
Independent Board Committee I, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders and Mr. Su, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grant to Mr. Yi.
Anglo Chinese Corporate Finance, Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committees and the independent shareholders in relation to the above.
Listing Approval
The HKEx has previously granted its approval of the listing of, and permission to deal in, new shares which may be issued pursuant to the vesting of Proposed RSU Grants which may be granted pursuant to the 2016 Plan.
Information about the Company
BeiGene is a global, commercial-stage biotechnology company focused on discovering, developing, manufacturing, and commercializing innovative medicines to improve treatment outcomes and access for patients worldwide. Our 5,400+ employees around the world are committed to expediting the development of a diverse pipeline of novel therapeutics. We currently market two internally discovered oncology medicines: BTK inhibitor BRUKINSA® (zanubrutinib) in the United States and China, and anti-PD-1 antibody tislelizumab in China. We also market or plan to market in China additional oncology products in China licensed from Amgen Inc., Celgene Logistics Sàrl, a Bristol Myers Squibb (BMS) company, and EUSA
 
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Pharma; and have entered a collaboration with Novartis Pharma AG for Novartis to develop, manufacture and commercialize tislelizumab in North America, Europe, and Japan.
Annual Meeting
A notice convening the Annual Meeting to be held on June 16, 2021 at the offices of Mourant Governance Services (Cayman) Limited, at 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands is set out in this Proxy Statement. Ordinary resolutions will be proposed at the Annual Meeting for the independent shareholders to approve the Proposed RSU Grants.
A form of proxy for use at the Annual Meeting is enclosed with this Proxy Statement. Whether or not you intend to attend and vote at the Annual Meeting in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon. Persons who hold our ordinary shares directly on our Cayman Islands register of members on the record date (i.e. at 5:00 a.m. Cayman Islands Time / 6:00 a.m. New York Time / 6:00 p.m. Hong Kong Time on April 19, 2021) must return a form of proxy (i) by mail or by hand to the offices of our Cayman Registrar: Mourant Governance Services (Cayman) Limited, 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands, or (ii) by email at BeiGene@mourant.com. Persons who hold our ordinary shares directly on our Hong Kong register of members on the record date must return a form of proxy by mail or by hand to the offices of our HK Registrar: Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible, but in any event no later than 4 a.m. Cayman Islands Time / 5:00 a.m. New York Time / 5:00 p.m. Hong Kong Time on June 13, 2021. Completion and return of the form of proxy will not preclude you from attending and voting in person at the Annual Meeting or any adjourned meeting.
In accordance with Rule 13.39(4) of the HK Listing Rules, all votes of the independent shareholders at the Annual Meeting shall be taken by poll.
In order to qualify for the right to attend and vote at the Annual Meeting, all relevant share certificates and properly completed transfer forms must be lodged for registration with the Company’s Hong Kong Branch Share Registrar, Computershare Hong Kong Investor Services Limited, Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong before 4:30 p.m. Hong Kong Time on April 19, 2021.
RECOMMENDATION
Anglo Chinese Corporate Finance, Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committees and the independent shareholders with regard to the Proposed RSU Grants and consider that each of the Proposed RSU Grants are fair and reasonable so far as the interests of the independent shareholders are concerned. Your attention is drawn to the letter of advice from Anglo Chinese Corporate Finance, Limited included in this Proxy Statement containing its recommendation and the principal factors it has taken into account.
Independent Board Committee A, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee A recommends the independent shareholders to vote in favor of the resolutions relating to the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper. The full text of the letter from Independent Board Committee A is set out in this Proxy Statement.
Independent Board Committee B, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Chen fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee C recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Chen. The full text of the letter from Independent Board Committee B is set out in this Proxy Statement.
Independent Board Committee C, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Glazer fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee D recommends the
 
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independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Glazer. The full text of the letter from Independent Board Committee C is set out in this Proxy Statement.
Independent Board Committee D, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Goller fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee E recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Goller. The full text of the letter from Independent Board Committee D is set out in this Proxy Statement.
Independent Board Committee E, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Krishana fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee F recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Krishana. The full text of the letter from Independent Board Committee E is set out in this Proxy Statement.
Independent Board Committee F, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Malley fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee G recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Malley. The full text of the letter from Independent Board Committee F is set out in this Proxy Statement.
Independent Board Committee G, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Dr. Sanders fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee H recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Dr. Sanders. The full text of the letter from Independent Board Committee G is set out in this Proxy Statement.
Independent Board Committee H, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Su fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee I recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Su. The full text of the letter from Independent Board Committee H is set out in this Proxy Statement.
Independent Board Committee I, having taken the advice of the Independent Financial Adviser into account, considers the terms of the Proposed RSU Grant to Mr. Yi fair and reasonable so far as the independent shareholders are concerned. Accordingly, Independent Board Committee J recommends the independent shareholders to vote in favor of the resolution relating to the Proposed RSU Grant to Mr. Yi. The full text of the letter from Independent Board Committee I is set out in this Proxy Statement.
The directors are of the opinion that the Proposed RSU Grants are fair and reasonable and in the interests of the Company and the Shareholders as a whole. The directors recommend that all shareholders should vote in favor of the relevant resolutions to be proposed at the Annual Meeting.
By order of the Board of Directors
BeiGene, Ltd.
Mr. John V. Oyler
Chairman
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE A
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Oyler, Dr. Wang and Mr. Hooper’s respective contributions to the Company and the terms of the Proposed RSU Grants, we are of the view that the terms of the Proposed RSU Grants are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grants are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolutions to be proposed at the Annual Meeting to approve the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper.
Yours faithfully,
For and on behalf of the
Independent Board Committee A
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Ranjeev Krishana Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE B
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Chen, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Chen’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Chen.
Yours faithfully,
For and on behalf of the
Independent Board Committee B
BeiGene, Ltd.
Mr. Donald W. Glazer Mr. Michael Goller Mr. Ranjeev Krishana
Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE C
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Glazer, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Glazer’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Glazer.
Yours faithfully,
For and on behalf of the
Independent Board Committee C
BeiGene, Ltd.
Mr. Timothy Chen Mr. Michael Goller Mr. Ranjeev Krishana
Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE D
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Goller, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Goller’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Goller.
Yours faithfully,
For and on behalf of the
Independent Board Committee D
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Ranjeev Krishana
Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE E
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Krishana, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Krishana’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Krishana.
Yours faithfully,
For and on behalf of the
Independent Board Committee E
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE F
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Malley, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Malley’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Malley.
Yours faithfully,
For and on behalf of the
Independent Board Committee F
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Ranjeev Krishana
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE G
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Dr. Sanders, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Dr. Sanders’ contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Dr. Sanders.
Yours faithfully,
For and on behalf of the
Independent Board Committee G
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Ranjeev Krishana Mr. Thomas Malley Mr. Jing-Shyh (Sam) Su
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE H
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Su, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Su’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Su.
Yours faithfully,
For and on behalf of the
Independent Board Committee H
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Ranjeev Krishana Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Qingqing Yi
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT BOARD COMMITTEE I
April   , 2021
To the independent shareholders of BeiGene, Ltd.
Dear Sir/Madam,
We have been appointed as an independent board committee of the Company to advise independent shareholders in connection with the Proposed RSU Grant to Mr. Yi, details of which are set out in the Proxy Statement dated April   , 2021, of which this letter forms part. Terms defined in the Proxy Statement shall have the same meanings when used herein unless the context otherwise requires.
Having considered the advice of Anglo Chinese Corporate Finance, Limited, the independent financial adviser of the Company, in relation thereto as set out in the Proxy Statement, Mr. Yi’s contributions to the Company and the terms of the Proposed RSU Grant, we are of the view that the terms of the Proposed RSU Grant are fair and reasonable so far as the independent shareholders are concerned. We are of the view that that the Proposed RSU Grant are made on normal commercial terms and during the ordinary and usual course of the Company’s business, and are in the interest of the Company and its shareholders.
Accordingly, we recommend the independent shareholders to vote in favor of the resolution to be proposed at the Annual Meeting to approve the Proposed RSU Grant to Mr. Yi.
Yours faithfully,
For and on behalf of the
Independent Board Committee I
BeiGene, Ltd.
Mr. Timothy Chen Mr. Donald W. Glazer Mr. Michael Goller
Mr. Ranjeev Krishana Mr. Thomas Malley
Dr. Corazon (Corsee) D. Sanders
Mr. Jing-Shyh (Sam) Su
Independent Non-executive
Directors
 
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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER
April   , 2021
To: Independent Board Committees and the Independent Shareholders
Dear Sir or Madam,
PROPOSED GRANTS OF RESTRICTED SHARE UNITS TO DIRECTORS
We refer to our appointment as the Independent Financial Adviser to advise the Company’s Independent Board Committees and the independent shareholders of the Company (“Independent Shareholders”) on the fairness and reasonableness of the terms of the Proposed RSU Grants and whether the transactions contemplated thereunder are on normal commercial terms and in the ordinary course of business of the Company, and to make a recommendation to the Independent Shareholders in respect thereof. Details of the Proposed RSU Grants are set out in the “Letter from the Board” ​(“Letter from the Board”) in the proxy statement dated April   , 2021 (the “Proxy Statement”) filed by BeiGene, Ltd. (the “Company”, together with its subsidiaries (the “Group”)), of which this letter forms part. Capitalized terms used in this letter shall have the same meanings as defined in the Proxy Statement unless the context requires otherwise.
As of the Latest Practicable Date, Mr. Oyler, Dr. Wang, Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi are directors of the Company. Pursuant to Chapter 14A of the HK Listing Rules, they are connected persons of the Company, and the Proposed RSU Grants and transactions contemplated therein constitute non-exempt connected transactions of the Company that are subject to reporting, announcement and the independent shareholders’ approval requirements.
Independent Board Committee A, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed RSU Grants to Mr. Oyler, Dr. Wang and Mr. Hooper.
Independent Board Committee B, comprising Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Chen.
Independent Board Committee C, comprising Mr. Chen, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Glazer.
Independent Board Committee D, comprising Mr. Chen, Mr. Glazer, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Goller.
Independent Board Committee E, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Krishana.
Independent Board Committee F, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Dr. Sanders, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Malley.
40th Floor, Two Exchange Square, 8 Connaught Place, Central, Hong Kong.
Telephone +852 2845 4400 Facsimile: +852 2845 1162 e-mail: accf@anglochinesegroup.com
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Independent Board Committee G, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Mr. Su and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Dr. Sanders.
Independent Board Committee H, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders and Mr. Yi, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Su.
Independent Board Committee I, comprising Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders and Mr. Su, all being independent non-executive directors, has been formed to advise the independent shareholders as to the fairness and reasonableness of the terms of the Proposed Grant to Mr. Yi.
In formulating our opinion and recommendation, we have reviewed (i) the 2016 Plan; (ii) the Company’s prospectus dated July 30, 2018; (iii) the Company’s annual reports for the years ended December 31, 2017, 2018 and 2019 and 2020; (iv) the Proxy Statement; (v) the findings on the review of the Company’s compensation programs prepared by an independent compensation consultant, Frederic W. Cook & Co., Inc.; (vi) the independent director compensation policy of the Company; (vii) share award schemes adopted by listed companies comparable to the Company; and (viii) other information as set out in the Proxy Statement.
We have relied on the accuracy of the information, facts, representations and opinions expressed by the Board, referred to in the Proxy Statement. We have assumed that the information, representations and opinions were true at the time they were made and continue to be true as of the date of the Proxy Statement and will continue to be true up to the time the Independent Shareholders vote on the resolutions to approve the Proposed RSU Grants. We consider that we have reviewed sufficient information to reach the conclusions set out in this letter and have no reason to believe any of the information provided to us by the management of the Company is inaccurate or that any material information has been omitted or withheld from the information supplied or the opinions expressed in the Proxy Statement. We have also assumed that all statements of belief and opinion of the Board as set out in the announcement of the Company dated April   , 2021 and the Proxy Statement were reasonably made after due and careful enquiry. We have not, however, carried out any independent verification on the information provided to us by the Company, nor have we conducted any form of independent in-depth investigation into the business and affairs or prospects of the Group or its associates.
Apart from professional fees for our services to the Company in connection with the engagement described above, no arrangement exists whereby we will receive any fees or benefits from the Company, its subsidiaries, directors, chief executive, substantial shareholders or any associate of any of them. During the two-year period immediately preceding the Latest Practicable Date, we were appointed as an independent financial adviser to the Company to advise on the share purchase agreement dated October 31, 2019, as amended by Amendment No. 1 dated December 6, 2019 and the Restated Amendment No.2 dated September 24, 2020 by and between the Company and Amgen Inc. and the transactions contemplated thereunder, details of which were set out in the proxy statements of the Company dated November 29, 2019 and October 9, 2020. Given our independent role and normal professional fees received from the Company under the past engagement, we do not consider that our independence to act in present appointment is affected by the prior engagements.
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PRINCIPAL FACTORS AND REASONS CONSIDERED
We have considered the following factors in arriving at our opinion on the Proposed RSU Grants:
(a) Information of the Group
The Company is a global, commercial-stage biotechnology company focused on discovering, developing, manufacturing, and commercializing innovative medicines to improve treatment outcomes and access for patients worldwide. The Company’s 5,400+ employees around the world are committed to expediting the development of a diverse pipeline of novel therapeutics. The Company currently market two internally discovered oncology medicines: BTK inhibitor BRUKINSA® (zanubrutinib) in the United States and China, and anti-PD-1 antibody tislelizumab in China. We also market or plan to market in China additional oncology products in China licensed from Amgen Inc., Celgene Logistics Sàrl, a Bristol Myers Squibb (BMS) company, and EUSA Pharma; and have entered a collaboration with Novartis Pharma AG for Novartis to develop, manufacture and commercialize tislelizumab in North America, Europe, and Japan.
Set out below is a table summarizing selected financial and business information of the Group extracted from the annual reports of the Company for the years ended December 31, 2018, 2019 and 2020.
Extract of consolidated statement of operations
For the year ended December 31,
2018
2019
2020
(US$’000)
(audited)
(US$’000)
(audited)
(US$’000)
(audited)
Revenue
– Product revenue, net
130,885 222,596 308,874
– Collaboration revenue
67,335 205,616
198,220 428,212 308,874
Research and development (“R&D”) costs
(679,005) (927,338) (1,294,877)
Net loss attributable to the Company
(673,769) (948,628) (1,596,906)
Extract of consolidated balance sheets
As of December 31,
2018
2019
2020
(US$’000)
(audited)
(US$’000)
(audited)
(US$’000)
(audited)
Total assets
2,249,684 1,612,289 5,600,757
Total liabilities
496,037 633,934 1,731,514
Total Company shareholders’ equity
1,739,202 962,205 3,869,243
Revenue
The Group’s revenue amounted to approximately US$428 million for the year ended December 31, 2019, representing an increase of approximately 116% as compared to approximately US$198 million for the year ended December 31, 2018. The increase was mainly due to (i) sales of ABRAXANE, REVLIMID and VIDAZA in China; and (ii) recognition of a one-time payment of US$150 million upon the termination of the 2017 collaboration and license agreement with Celgene for tislelizumab in June 2019.
The Group’s revenue amounted to approximately US$308 million for the year ended December 31, 2020, representing a decrease of approximately 28% as compared to approximately US$428 million for the
 
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year ended December 31, 2019. The decrease was mainly due to the absence of collaboration revenue recorded for the year ended December 31, 2020 (2019: US$206 million). Such decrease was partially offset by the increase in the Group’s product revenue from US$223 million for the year ended December 31, 2019 to approximately US$308 million for the year ended December 31, 2020.
R&D costs
R&D activities are central to the Group’s business model. They are mainly related to (i) the clinical advancement of its internally-developed drug candidates, including zanubrutinib, tislelizumab, pamiparib, lifirafenib, BGB-A333, BGB-A425, BGB-A1217 and BGB-11417; and (ii) in-licensed drug candidates, including Amgen pipeline assets under co-development, sitravatinib, ZW25, ZW49, BA3071, BAT1706, DXP-593 and DXP-604.
The Group’s R&D costs amounted to approximately US$927 million for the year ended December 31, 2019, representing an increase of approximately 36% as compared to approximately US$679 million for the year ended December 31, 2018. The increase was mainly due to (i) expansion of clinical trials for zanubrutinib and tislelizumab; (ii) increase in employee salary and benefits to support the Group’s expanding research and development activities; and (iii) increase of depreciation, travel, meeting and conferences, facility and IT allocable expenses, office expense, rental fees and other expenses to support the growth of the Group.
The Group’s R&D costs amounted to approximately US$1,295 million for the year ended December 31, 2020, representing an increase of approximately 40% as compared to approximately US$927 million for the year ended December 31, 2019. The increase was mainly due to (i) the increased spending on the ongoing and late-stage pivotal clinical trials; (ii) expense related to upfront license payments for in-licensed eight assets; (iii) development expenses associated with the Amgen collaboration; (iv) the preparation of additional regulatory submissions, and manufacturing costs related to development programs and pre-commercial activities; and (v) increase in employee share-based compensation expense due to increased headcount and a higher share price.
As of January 31, 2021, the Group owned 30 issued U.S. patents, 14 issued China patents, a number of pending U.S. and China patent applications, and corresponding patents and patent applications internationally. As discussed in the annual report of the Company for the year ended December 31, 2020, the Group expects its research and development costs to increase significantly in the foreseeable future as its development programs and clinical trials progress.
Net loss attributable to the Company
Based on the foregoing, the net loss attributable to the Company for the year ended December 31, 2018, 2019 and 2020 amounted to approximately US$674 million, US$949 and US$1,597 million, respectively.
Financial position of the Group
Total assets of the Group amounted to approximately US$5,601 million as of December 31, 2020, representing an increase of approximately 247%, as compared to US$1,612.3 million as of December 31, 2019.
Net assets of the Group increased from approximately US$962 million as of December 31, 2019 to approximately US$3,869 million as of December 31, 2020.
The increases in total assets and net assets as mentioned above were mainly attributable to the receipt of proceeds of (i) approximately US$2.78 billion from the share subscription by Amgen took place in January 2020 and (ii) approximately US$2.08 billion from the share subscription took place in July 2020.
 
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(b) Share Price performance of the Company
Set out below is the price performance of the ordinary Shares of the Company from August 8, 2018, being the date of listing of the Company’s shares on the HKEx (“Listing Date”), to the Latest Practicable Date.
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Source: Bloomberg
During the period from the Listing Date to the Latest Practicable Date (the “Review Period”), closing price of the shares of the Company ranged from HK$63.90 to HK$229.80 and with an average of approximately HK$110.24. The closing price of the shares of the Company as of the Latest Practicable Date of HK$213 was almost double of its offer price for listing in August 2018 of HK$108.0.
(c) Background of and reasons for the Proposed RSU Grants
The 2016 Plan was approved by the Board on November 7, 2018 and by the Shareholders on December 7, 2018 to amend and restate the 2016 Share Option and Incentive Plan originally adopted by the Company on January 14, 2016, to provide the Company with flexibility to use various equity-based incentives and other awards as compensation tools to motivate the Company’s workforce.
In order to continue to provide incentive opportunities under the 2016 Plan, in 2020, the Board of Directors and the shareholder approved an amendment to the 2016 Plan to increase the number of authorized shares of the Company available for issuance under the 2016 Plan and to extend the term of the 2016 Plan through 2030, as further described in the Company’s proxy statement for the 2020 annual general meeting of shareholders. For further details of the 2016 Plan, please refer to the Company’s Proxy Statement dated April 28, 2020.
 
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As of the Latest Practicable Date, the outstanding number of each of the RSUs and the share options; and the remaining numbers of the RSUs or share options available for future grants are set forth in the table below:
2016 Plan
Outstanding number
Available for future grants
RSUs
34,050,692 65,835,236(2)
Options
60,230,891
Note:
1.
Based on the information provided by the Company as of the Latest Practicable Date.
2.
The Proposed RSU and option Grants will be subject to such limit.
The Proposed RSU Grants to the Grantees (as defined below) are part of the Company’s compensation program for executive officers, Chair of the Scientific Advisory Board and non-executive directors.
The purpose of the grant to (i) the executive officer is to encourage the executive to focus on long-term company performance and align his interests with shareholders, promote retention and reward outstanding company and individual performance; (ii) the Chair of the Scientific Advisory Board is to provide sufficient incentive to retain and motivate the Chair to participate in the formulation of strategy and long-term development of the Company and to recognize his contribution to the growth of the Company; and (iii) the non-executive directors is to retain and motivate them to continue to provide their opinion and judgment to the Board of Directors in building the strategy and long-term development of the Company.
As discussed in the sub-section headed “(a) Information of the Group” above, the Group incurred substantial amount of R&D expense for the past three years as it continued the development and advancement of its pipeline products, and has been loss-making since its listing.
The Company’s success will depend on its ability to attract, retain and motivate key executives and qualified personnel to support the Group’s operations, research and development, manufacturing and commercialization of products. Dr. Wang as the Company’s Co-Founder, Chair of the Scientific Advisory Board and director, Mr. Oyler as the Company’s Co-Founder, Chief Executive Officer and Chairman of the Board and the non-executive and independent non-executive directors and scientific teams, are particularly valuable in that regard. Also, they are considered by the Board of Directors as vital for the Group to successfully implement its overall business strategy.
In the circumstance, we are of the view that the Proposed RSU Grants, which involve the issue of shares for the satisfaction of vested RSUs, is a flexible means for the Group to incentivize its employees, consultants and directors while preserving its liquidity required for its various business projects as opposed to cash bonuses that would incur significant cash outflow for the Group; and it is a standard compensation practice to provide equity rewards in addition to cash (as demonstrated by our analysis in the section headed “Comparison of the remuneration packages of the Grantees with those of the Comparable Companies” below).
(d) Principal terms of the Proposed RSU Grants
The Proposed RSU Grants to Mr. Oyler, Dr. Wang, Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi (the “Grantees”) will be granted for nil consideration, with each of the RSU granted represents the right to receive one ordinary share on the date it vests. Further terms are set out below:
 
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Independent non-
executive directors
Executive director
Non-executive directors
8 directors, namely
Mr. Chen,
Mr. Glazer,
Mr. Goller,
Mr. Krishana,
Mr. Malley,
Dr. Sanders,
Mr. Su and
Mr. Yi
Grantees
Mr. Oyler
Dr. Wang
Mr. Hooper
Initial market value US$3,750,000 US$1,000,000 US$200,000 US$200,000 each,
totaling US$1,600,000
Indicative number of RSUs 158,366 42,224 8,437 8,437 each, totaling 67,496
Vesting schedule 25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service; provided, however, that upon a termination without cause or for good reason as defined in Mr. Oyler’s employment agreement, the RSUs shall become vested as if he had remained employed for an additional 20 months; provided further that the RSUs shall become fully vested for underlying shares upon a change in control of the Company. 25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service. 100% of the ordinary shares shall vest upon the earlier to occur of the first anniversary of the grant date or the date of the next annual general meeting of shareholders; provided, however, that all vesting shall cease if the director resigns from the Board or otherwise ceases to serve as a director other than as set forth below or the Board determines that the circumstances warrant continuation of vesting. Unvested RSUs shall accelerate in full upon (i) death, (ii) disability, (iii) termination of service in connection with a change of control of the Company, or (iv) upon a change of control of the Company if the director’s service continues and the awards are not assumed by the acquiror at the time of the change of control. Subject to specific terms and conditions designed for compliance with applicable tax and other regulations, a director generally may elect to defer settlement of their RSUs until six months following the date that the director ceases to serve as a director.
The final number of RSUs underlying each Proposed RSU Grant shall be calculated by dividing the grant value by the closing price of the ADSs on NASDAQ on the date of the Annual Meeting, i.e. June 16, 2021 as divided by 13. If the Independent Shareholders’ approval is not obtained by the date of the Annual Meeting, the respective Proposed RSU Grant shall be replaced by share option grant with the same grant date value in accordance with Chapter 17 of the HK Listing Rules.
As understood from the Company, if a RSU holder resigns before the vesting of the RSUs granted under the 2016 Plan, the unvested RSUs except any portion subject to acceleration will be fortfeited. We consider that such vesting mechanism will serve the purpose of retaining the directors by providing them incentive to remain with the Group before the full vesting of the RSUs.
In addition to the Proposed RSU Grants, the Board of Directors will also grant the proposed share option grants under the 2016 Plan to Mr. Oyler, Mr. Wang and other non-executive directors on the date of Annual Meeting. Details of such share option grants are set out below for illustrative purpose:

share options with a grant date fair value of US$11,250,000 to Mr. Oyler. 25% of the ordinary shares subject to the share options shall become exercisable on the first anniversary of the grant date, and the balance become exercisable in 36 successive equal monthly installments thereafter, subject to continued services. Provided, however, that upon a termination without cause or for good reason as defined in Mr. Oyler’s employment agreement, the option shall become exercisable for underlying shares as if he had remained employed for an additional 20 months; provided further that the option shall become exercisable for all underlying shares upon a change in control of the Company;

share options with a grant date fair value of US$3,000,000 to Dr. Wang. 25% of the ordinary shares subject to the share options shall become exercisable on the first anniversary of the grant date, and the balance become exercisable in 36 successive equal monthly installments thereafter, subject to continued services;
 
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share options with a grant date fair value US$200,000 to each of the other non-executive directors and independent non-executive directors. The share options shall vest in full on the earlier of the first anniversary of grant date or the date of the next annual general meeting of shareholders; provided, however, that all vesting shall cease if the director resigns from the Board or otherwise ceases to serve as a director other than as set forth below or the Board determines that the circumstances warrant continuation of vesting. All options shall be exercisable for three years following cessation of service, and unvested options shall accelerate in full upon (i) death, (ii) disability and (iii) termination of service in connection with a change of control of the Company, or (iv) upon a change of control of the Company if the director’s service continues and the awards are not assumed by the acquiror at the time of the change of control; and

each share option will have an exercise price equal to the greater of (i) the fair market value of the Company’s ordinary shares on the date of grant and (ii) the average fair market value of the Company’s ordinary shares over the five trading days preceding the grant date, in each case as determined in reference to the closing price of the Company’s ADSs on the NASDAQ.
(e) Assessment on the fairness and reasonableness of the Proposed RSU Grants
Comparable scheme
We have, to the best of our knowledge, identified the following list of comparable share award schemes (“Comparable Schemes”) adopted by biotechnology companies listed as of the developed overseas exchanges with market capitalization of US$20 billion to US$60 billion as of the Latest Practicable Date (“Comparable Companies”) for our assessment of the fairness and reasonableness of the terms of 2016 Plan. Notwithstanding the fact that none of the Comparable Companies is listed in Hong Kong, their principal businesses, target markets and business scales are similar to those of the Company. We consider the Comparable Schemes to be fair and representative for our comparable analysis and are exhaustive based on our selection criteria outlined above. We have not taken into consideration share award schemes of publicly traded companies operating in non-biotechnology industries which are, in our view, not comparable given the differences in the nature and life cycle of business, operational risks faced by the business and hence remuneration packages of directors and senior management.
We have compared the background and the fundamentals of the Comparable Companies to that of the Group. Details of the comparison are set out below:
 
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Comparable
Companies
Headquarters
Stock code
Year of
incorporation
Market
capitalisation
as of the
Latest
Practicable
Date
Revenue
for the
year ended
December 31,
2020
Research
and
development
expenses for
the year ended
December 31,
2020
No. of
employees
as of
December 31,
2020
Description
(US$’million)
(US$’million)
(US$’million)
Moderna, Inc. United States MRNA
(Nasdaq)
2010 58,316 803 1,370 1,300 Operates as a commercial stage biotechnology company. The company focuses on the discovery and development of messenger RNA therapeutics and vaccines. Moderna, Inc. develops mRNA medicines for infectious, immuno-oncology, and cardiovascular diseases.
Vertex
Pharmaceuticals
Incorporated
United States VRTX
(Nasdaq)
1989 56,884 6,206 1,830 3,400 Discovers, develops, and commercializes pharmaceutical products. The company develops drugs for the treatment of cystic fibrosis, cancer, inflammatory bowel, autoimmune disease, and neurological disorders. Vertex Pharmaceuticals serves healthcare sector worldwide.
Regeneron
Pharmaceuticals, Inc.
United States REGN
(Nasdaq)
1988 51,768 8,497 2,735 9,123 A biopharmaceutical company. The company discovers, develops, and commercializes pharmaceutical products for the treatment of serious medical conditions.
Biogen Inc. United States BIIB
(Nasdaq)
1978 41,487 13,445 3,991 9,100 Develops, manufactures, and commercializes therapies, focusing on neurology, oncology, and immunology. The company products address diseases such as multiple sclerosis, non-hodgkin’s lymphoma, rheumatoid arthritis, crohn’s disease, and psoriasis.
Alexion Pharmaceuticals, Inc. United States ALXN
(Nasdaq)
1992 34,110 6,070 1,003 3,837 A biopharmaceutical company, researches and develops proprietary immunoregulatory compounds for the treatment of autoimmune and cardiovascular diseases. The company develops C5 complement inhibitors and apogens which are two classes of potential therapeutic compounds designed to selectively target specific disease-causing segments of the immune system.
Seagen Inc. United States SGEN
(Nasdaq)
1997 26,836 2,176 827 2,092 Operates as a biotechnology company. It discovers and develops monoclonal antibody-based drugs to treat cancer and related diseases, as well as offers antibody-drug conjugate technology designed to deliver cell-killing agents directly to tumor cells. Seagen serves customers worldwide.
The Company China BGNE
(Nasdaq)
6160
(HKSE)
2010 32,595 309 1,295 5,300 BeiGene is a global, commercial-stage biotechnology company focused on discovering, developing, manufacturing, and commercializing innovative medicines to improve treatment outcomes and access for patients worldwide.
 
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Source: Bloomberg and Reuters
We have also compared the Comparable Schemes and their respective grantees to that of the Group. Details of the comparison are set out below:
Company name
(Stock code)
Year adopted restated
or amended
Participants
Type of award
Purpose of the grant
Accelerated vesting
Vesting terms of
the RSUs
Moderna, Inc.
(MRNA)
2018 Employees, officers, directors, consultants, and other key persons Incentive stock options, non-qualified stock options, restricted stock, unrestricted stock, and restricted stock units Encourage and enable the officers, employees, non-employee directors and consultants and its affiliates upon whose judgment, initiative and efforts the company largely depends for the successful conduct of its business to acquire a proprietary interest in the company. Yes Service based awards generally vest over a four-year period, with the first 25% of such awards vesting following twelve months of continued employment or service
Vertex Pharmaceuticals Incorporated
(VRTX)
2013 Employees, non-employee directors and consultants Non-statutory stock option, restricted stock units or other equity-based awards To attract, retain and motivate people with the necessary talent and experience and to provide additional incentive to achieve its short- and long-term business objectives. Yes, upon a change in control and in the event of termination of employment or service as a director under specified circumstances Vesting of the earned shares in three equal instalments over three years
Regeneron Pharmaceuticals, Inc.
(REGN)
2014 Employees of the Company, including officers, and nonemployees, including non-employee members of the company’s board of directors Incentive stock options and nonqualified stock options, shares of restricted stock, restricted stock units, and other awards
Considers equity and equity-based compensation to be a key component of its compensation program and believe that it is essential to attract, motivate, and retain talented, experienced, and committed employees and to incentivize its employees to
achieve its short- and long-term goals.
Yes, upon a change in control Vest 50% on the second anniversary of the grant date and 50% on the fourth anniversary of the grant date.
 
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Company name
(Stock code)
Year adopted restated
or amended
Participants
Type of award
Purpose of the grant
Accelerated vesting
Vesting terms of
the RSUs
Biogen Inc.
(BIIB)
Approved by stockholders on May 25, 2006; as amended through March 27, 2015 Non-employee board members of the company and its affiliates Options, shares of restricted stock, restricted stock units, stock appreciation rights and other awards To provide an additional incentive to those directors to promote the success of the company and its affiliates. Yes, upon a change in control, involuntary termination or termination of the plan Initial grants shall vest ratably in equal annual installments on each of the first three anniversaries of the date of grant. Annual grants shall fully vest on the first anniversary of the date of grant
Biogen Inc.
(BIIB)
2017 Employee of the company or one of its affiliates Restricted stock units To encourage ownership of shares of common stock by non-employee directors of the company and its affiliates, and to provide an additional incentive to those directors to promote the success of the company and its affiliates. Yes, upon a change in control and termination of employment The award will become vested in three equal instalments on each of the first, second and third anniversaries of the grant date.
Alexion Pharmaceuticals, Inc.
(ALXN)
2017 Key employees and directors of, and consultants and advisors to, the company and its subsidiaries Grant of stock, stock-based and other incentive awards To attract and retain key talent, incentivize sustainable growth and long-term value creation, and align the interests of its employees with those of its shareholders. Yes, upon a change in control or if their employment is terminated without cause or in certain other instances 25% of the shares subject to the RSU award on each of the first four anniversaries of the grant date
Seagen Inc.
(SGEN)
Approved by stockholders on December 23, 2007, as amended and restated in 2012 Employees, including officers, directors and consultants and affiliates Stock options, restricted stock, RSUs, stock appreciation rights and other similar types of awards To encourage ownership by key personnel whose long-term employment or other service relationship with the Company is considered essential to the Company’s continued progress and, thereby, encourage recipients to act in the stockholders’ interest and share in the Company’s success. Yes, upon a change in control and termination of employment RSUs granted to employees vest 25% each year beginning one year after the grant date. Option and RSU grants to non-employee members of our board of directors vest over one year.
 
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Company name
(Stock code)
Year adopted restated
or amended
Participants
Type of award
Purpose of the grant
Accelerated vesting
Vesting terms of
the RSUs
The Company —
2016 Plan
January 14, 2016 (most recently amended on June 17, 2020) Officers, employees, nonemployee directors and consultants of the Group Share options, restricted share units and other incentive awards To encourage and enable the officers, employees, nonemployee directors and consultants of the Group upon whose judgment, initiative and efforts the Company largely depends for the successful conduct of its businesses to acquire a proprietary interest in the Company. Yes, upon a change in control and/or certain qualifying termination events 25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service for executive director and certain non-executive director; and 100% of the ordinary shares shall vest upon the earlier to occur of the first anniversary of the grant date and the next annual general meeting for certain non-executive directors
Source: the regulatory filings of the Comparable Companies
We consider that the seven Comparable Schemes adopted by the Comparable Companies demonstrate that the alignment of interests of selected employees and non-employee directors by way of grant and ownership of award shares is a market practice. We also consider the purposes of the Comparable Schemes are similar to that of the 2016 Plan and the Proposed RSU Grants.
From the table above, we see that other than Biogen Inc., who awards restricted stock units to non-employee board members and employees of the company under two separate schemes, all of the other Comparable Schemes permit both employees and directors to participate. We also note that the restricted stock units awarded under all of the Comparable Schemes will be vested in multiple tranches over three to four years and are subject to accelerated vesting. In particular, the restricted stock units granted under the Comparable Schemes of Moderna, Inc., Alexion Pharmaceuticals, Inc., and Seagen Inc. will be vested 25% each year, which resemble the 2016 Plan.
The non-employee directors’ equity plan adopted by Biogen Inc. in 2006 (the “Biogen 2006 Plan”) intended to grant award shares to only the non-employee board members of the company and its affiliates. According to the Biogen 2006 Plan, each individual who is first elected as a non-employee director may be granted the initial grants on the date of such initial election. Initial grants shall vest ratably in equal annual installments on each of the first three anniversaries of the date of grant. Further, on the date of each annual stockholders meeting, each individual who is at the time serving as a non-employee director shall be granted one or more awards. Such annual grants shall fully vest on the first anniversary of the date of grant or over such longer period and in such increments as the committee may otherwise determine. We consider the vesting provision of the Biogen 2006 Plan comparable to the Proposed RSU Grants’ to the non-executive directors of the Company, where 100% of the ordinary shares shall vest upon the earlier of the first anniversary of the grant date or the date of the next annual general meeting of shareholders.
Rationale for the Proposed RSU Grants
(i) Mr. Oyler
Mr. Oyler is the Company’s Co-Founder, Chief Executive Officer and Chairman of the Board. He has served as a member of the Board of Directors since October 2010. From 2005 to 2009, Mr. Oyler served as
 
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President and Chief Executive Officer of BioDuro, LLC, a drug discovery outsourcing company, which was acquired by Pharmaceutical Product Development Inc. From 2002 to 2004, Mr. Oyler served as Chief Executive Officer of Galenea Corp., a biopharmaceutical company dedicated to the discovery of novel therapies for central nervous system diseases, which initially were developed at Massachusetts Institute of Technology. From 1998 to 2002, Mr. Oyler was a Founder and the President of Telephia, Inc. which was bought by The Nielsen Company in 2007. From 1997 to 1998, Mr. Oyler served as Co-Chief Executive Officer of Genta Incorporated, an oncology-focused biopharmaceutical company that was listed on the NASDAQ. Mr. Oyler began his career as a management consultant at McKinsey & Company. Mr. Oyler received his B.S. from the Massachusetts Institute of Technology in June 1990 and an MBA from Stanford University in January 1996.
The Proposed RSU Grant to Mr. Oyler is part of the Company’s compensation program for employees, including executive officers. The purpose of such grant is to encourage executives and other employees to focus on long-term company performance and align their interests with shareholders, promote retention and reward outstanding company and individual performance. The Board of Directors proposed to compensate Mr. Oyler with the Proposed RSU Grant after considering Mr. Oyler’s integral role as Co-Founder, Chief Executive Officer and Chairman of the Board, his extensive leadership, executive, managerial, business and biotechnology company experience, his years of industry experience in the development of pharmaceutical products and contribution to the rapid growth of the Company.
The Board of Directors considered that the retention and motivation of Mr. Oyler are indispensable to the senior management of the Company. The Company maintains an industry-specific peer group of publicly traded companies in the biopharmaceutical and biotechnology industries that is selected based on a balance of criteria, such as the size of the company, the stage of development and data availability, for benchmarking pay. The value of RSUs to be granted to Mr. Oyler was determined by the Board of Director upon recommendation of the Compensation Committee by referencing the equity grant practice of the Company’s compensation peer group. As further discussed under the heading of “Executive Compensation” in this Proxy Statement, the Board of Directors and/or the Compensation Committee generally positions target total compensation for the Company’s executive officers above the median target total compensation in its peer group, with target total cash compensation, including base salaries and target annual incentives, at or below the 25th percentile and equity incentive awards above the median in order to link compensation more closely with corporate performance and the creation of shareholder value.
As discussed in the sub-section headed “(b) Share Price performance of the Company” above, we note that the closing price of the shares of the Company as of the Latest Practice Date was almost double of its offer price for listing in July 2018. Moreover, we have reviewed the share price performances of the Comparable Companies and noted that, except for Moderna, Inc. whose share price experienced exceptional upswing during the Review Period mainly as a result of its development and introduction of COVID-19 vaccine, the Company surpassed the other Comparable Companies in terms of share price performance in the same period. In this regard, we concur with the Board of Directors’ rationale to position Mr. Oyler’s compensation above the median target total compensation in its peer group.
(ii) Dr. Wang
Dr. Wang is the Company’s Co-Founder and has served as a member of the Board of Directors since February 2016. He has also served as the Chairman of the Scientific Advisory Board since 2011. Dr. Wang has served as the founding Director of the National Institute of Biological Sciences in Beijing since 2003 and became its Director and Investigator in 2010. In addition, Dr. Wang has served as a Chair Professor at Tsinghua University since 2020. Previously, he was a Howard Hughes Medical Institute Investigator from 1997 to 2010 and held the position of the George L. MacGregor Distinguished Chair Professor in Biomedical Sciences at the University of Texas Southwestern Medical Center in Dallas, Texas from 2001 to 2010. In 2004, Dr. Wang founded Joyant Pharmaceuticals, Inc., a venture capital-backed biotechnology company focused on the development of small molecule therapeutics for cancer. Dr. Wang received his B.S. in Biology
 
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from Beijing Normal University in July 1984 and his Ph.D. in Biochemistry from the University of Texas Southwestern Medical Center in May 1991. Dr. Wang has been a member of the National Academy of Sciences, USA since 2004 and a foreign associate of the Chinese Academy of Sciences since 2013.
Dr. Wang’s consulting services include leading the Scientific Advisory Board and providing short- and long-term strategic advice to the Company in his areas of expertise, participating in the Company’s leadership team meetings from time to time, and interacting with the Company’s key stakeholders on behalf of the Company.
The Board of Directors believes that Dr. Wang’s stature in the Chinese scientific and biotechnology communities provides the Company with significant intangible benefits and access to key stakeholders in the Company’s industry. His scientific expertise and knowledge of oncology research and development and the Chinese market are highly valuable to the Company. The value of RSUs to be granted to Dr. Wang was determined by the Board of Directors upon recommendation of the Compensation Committee to reflect his major contributions to the Company.
(iii) Nine non-executive directors
The Proposed RSU Grants to other non-executive directors, namely Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi, are part of the Company’s compensation package to the non-executive directors. The Proposed RSU Grants to other non-executive directors aim to retain and motivate them to continue to provide their opinion and judgment to the Board of Directors in building the strategy and long-term development of the Company.
We have reviewed the non-executive directors’ qualifications and experience in the biotechnology industry and noted that in the year ended December 31, 2020, each of them on average attended 12 committee meetings out of the 14 held by the Company.
We are of the view that the Grantees’ extensive experience in the biotechnology industry and their contributions to the Company, as described above, are contributory to the management, operation and development of the Company.
Comparison of the remuneration packages of the Grantees with those of the Comparable Companies
The Compensation Committee takes into consideration factors such as compensation paid by comparable companies, and time commitment and responsibilities of the directors and senior management in making recommendations to the Board of Directors regarding the remuneration packages of the directors and senior management. Set out below is an illustration of the Grantees’ remunerations in U.S. dollars when the Proposed RSU Grants and share option grants are added on their actual non-equity remunerations for the year ended December 31, 2020 (the “Illustrative Remuneration”):
Grantee
Position
Total
cash emoluments
for the
year ended
December 31,
2020
Total
grant date
fair value
of RSU
grants
Total
grant date
fair value
of share
option
grants
Aggregate
remuneration
(Note 1 and 2)
(Note 3)
(Note 3)
Mr. Oyler
Chairman and Executive Director 1,409,349 3,750,000 11,250,000 16,409,349
Dr. Wang
Non-executive Director 250,000 1,000,000 3,000,000 4,250,000
Mr. Hooper
Non-executive Director 69,042 200,000 200,000 469,042
Mr. Chen
Independent Non-executive Director
69,592 200,000 200,000 469,592
Mr. Glazer
Independent Non-executive Director
62,500 200,000 200,000 462,500
 
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Grantee
Position
Total
cash emoluments
for the
year ended
December 31,
2020
Total
grant date
fair value
of RSU
grants
Total
grant date
fair value
of share
option
grants
Aggregate
remuneration
(Note 1 and 2)
(Note 3)
(Note 3)
Mr. Goller
Independent Non-executive Director
60,625 200,000 200,000 460,625
Mr. Krishana
Independent Non-executive Director
63,125 200,000 200,000 463,125
Mr. Malley
Independent Non-executive Director
78,125 200,000 200,000 478,125
Dr. Sanders
Independent Non-executive Director
23,894 200,000 200,000 423,894
Mr. Su
Independent Non-executive Director
58,958 200,000 200,000 458,958
Mr. Yi
Independent Non-executive Director
73,125 200,000 200,000 473,125
Notes:
1.
Comprised salaries and other benefits, performance bonus and/or retirement benefit scheme contributions as disclosed in the Proxy Statement.
2.
Assuming the remunerations of the Grantees (before the Proposed RSU Grants and share option grants) will equal to those for the year ended December 31, 2020.
3.
The grant date fair value of the RSUs to be granted to Mr. Oyler, Dr. Wang and each of other non-executive directors are US$3,750,000, US$1,000,000 and US$200,000, respectively. In addition, the grant date fair value of the share options to be granted to Mr. Oyler, Dr. Wang and each of other non-executive directors are US$11,250,000, US$3,000,000 and US$200,000, respectively.
As set out in the table above, assuming that (1) non-equity remunerations of the Grantees (before the Proposed RSU Grants and share option grants) will equal to those for the year ended December 31, 2020; and (2) the value of the RSUs (under the Proposed RSU Grants) and share options (under the share option grants) is the grant date fair value, the Illustrative Remuneration of Mr. Oyler, Dr. Wang, Mr. Hooper and the eight independent non-executive directors will then amount to approximately US$16.4 million, US$4.3 million, US$0.5 million and US$0.5 million on average, respectively.
In assessing the fairness and reasonableness of the Illustrative Remuneration of the Grantees, we have compared the remuneration packages of Comparable Companies’ directors based on their latest available filings as of the Latest Practicable Date.
Total Remunerations
Executive and
non-executive directors(note 1)
Independent directors(note 1)
Comparable Companies
Stock code
Minimum
Maximum
Minimum
Maximum
(US$’000)
(US$’000)
(US$’000)
(US$’000)
Moderna, Inc.
MRNA 12,855,275 12,855,275 474,375 871,875
Vertex Pharmaceuticals
Incorporated
VRTX 6,816,936 18,789,985 494,534 607,877
Regeneron Pharmaceuticals, Inc.
REGN 20,664,135 22,304,326 699,993 724,993
Biogen Inc.
BIIB 18,159,858 18,159,858 330,036 725,310
Alexion Pharmaceuticals, Inc.
ALXN 17,919,259 17,919,259 444,957 595,025
Seagen Inc.
SGEN 14,521,495 14,521,495 427,604 482,741
The Company(Note 2)
BGNE/6160.HK 469,042 16,409,349 423,894 478,125
 
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Source: Reuters
Note:
1.
The remuneration information is based on the latest available annual remuneration information of each director of the Comparable Companies.
2.
The figures represent the ranges of the Illustrative Remuneration.
Although details with respect to each Comparable Company and its director(s) such as responsibilities, experience and years of service of each director as well as product type, stage of clinical development and commercialization and scale of each company may vary, we consider that the Comparable Companies serve as a general reference to indicate common market practice in determining the remuneration packages of directors of biotech companies.
As shown in the table above, the remuneration of the Comparable Companies’ (i) executive and non-executive directors ranged from approximately US$6.8 million to approximately US$22.3 million; and (ii) independent directors ranged from approximately US$0.3 million to approximately US$0.9 million; and the Illustrative Remunerations appear to be generally in line with such ranges.
In addition, we have analyzed the cash, share options and share awards components of the remuneration packages of the Comparable Companies’ directors based on their latest available filings as the Latest Practicable Date. A summary of such analysis is set out below:
Executive and non-executive directors
Independent directors
Company
Cash
(% Total)
Share Options
(% Total)
Share Awards
(% Total)
Cash
(% Total)
Share Options
(% Total)
Share Awards
(% Total)
Moderna, Inc.
30.0% 70.0% 0.0% 11.4% 88.6% 0.0%
Vertex Pharmaceuticals Incorporated
27.0% 24.0% 49.0% 25.4% 32.7% 42.0%
Regeneron Pharmaceuticals, Inc.
41.7% 42.8% 15.5% 16.0% 67.2% 16.8%
Biogen Inc.
32.0% 0.0% 68.0% 34.6% 0.0% 65.4%
Alexion Pharmaceuticals, Inc.
23.7% 0.0% 76.3% 27.6% 0.0% 72.4%
Seagen Inc.
19.8% 24.1% 56.0% 17.1% 39.8% 43.1%
Maximum 41.7% 70.0% 76.3% 34.6% 88.6% 72.4%
Average 29.0% 26.8% 44.1% 22.0% 38.0% 39.9%
Median 28.5% 24.1% 52.5% 21.2% 36.2% 42.5%
Minimum 19.8% 0.0% 0.0% 11.4% 0.0% 0.0%
The Company
8.2% 68.4% 23.4% 13.3% 43.4% 43.4%
Source: Reuters and the information provided by the Company
In respect of the Comparable Companies’ executive and non-executive directors, approximately 19.8% to 41.7%, nil to 70.0% and nil to 76.3% of their total remunerations were paid by way of cash, share options and award shares, respectively. We note the ratios of share options and award shares components of the Illustrative Remuneration of the Company’s executive and non-executive directors, namely, 68.4% and 23.4%, are within market ranges, while the ratio of cash component is below the minimum of the Comparable Companies.
In respect of the Comparable Companies’ independent directors, approximately 11.4% to 34.6%, nil to 88.6% and nil to 72.4% of their total remunerations were paid by way of cash, share options and award shares,
 
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respectively. Again, we note that the ratios of share options and award shares components of the Illustrative Remuneration of the Company’s independent non-executive directors, namely, 43.4% and 43.4% respectively, are within the range of the Comparable Companies’, while the cash component of 13.3% is lower than the average and median percentage indicated by the Comparable Companies.
We consider the remuneration compositions of the Company’s directors described above are fair and reasonable and in-line with market practice.
Dilution effect
Assuming each of the directors becomes fully entitled to all shares underlying the Proposed RSU Grants and based on the indicative number of RSUs set forth above, the total number of such underlying shares would amount to 276,523 ordinary shares, or approximately 0.02% of the total number of issued shares as of the Latest Practicable Date, and such shares will represent 0.02% of the total number of issued shares upon completion of issue.
The shareholding structure of the Company before and after each of the directors becomes fully entitled to all of the shares underlying the Proposed RSU Grants is summarized as follows (calculated assuming the indicative number of RSUs set forth above and based on the total number of issued shares as of the Latest Practicable Date):
Latest Practicable Date(1)
Assuming full vesting of the Proposed RSU Grants(2)
No. of shares
%(3)
No. of shares
%
Mr. Oyler
77,412,897(4) 6.47% 77,571,263 6.48%
Dr. Wang
20,968,574(5) 1.75% 21,010,798 1.75%
Mr. Hooper
67,353(6) 0.01% 75,790 0.01%
Mr. Chen
460,340(7) 0.04% 468,777 0.04%
Mr. Glazer
3,155,247(8) 0.26% 3,163,684 0.26%
Mr. Goller
336,700(9) 0.03% 345,137 0.03%
Mr. Krishana
336,700(10) 0.03% 345,137 0.03%
Mr. Malley
1,249,448(11) 0.10% 1,257,885 0.11%
Dr. Sanders
27,482(12) 0.002% 35,919 0.003%
Mr. Su
173,277(13) 0.01% 181,714 0.02%
Mr. Yi
327,418(14) 0.03% 335,855 0.03%
Other Shareholders
1,092,807,181 91.27% 1,092,807,181 91.25%
Total 1,197,322,617 100% 1,197,599,140 100%
(1)
Assuming that no shares are issued pursuant to any of the Proposed RSU Grants.
(2)
Without taking into account Shares which may be repurchased or issued by the Company (except for the Proposed RSU Grants).
(3)
The calculation is based on the total number of 1,197,322,617 ordinary shares in issue as of the Latest Practicable Date, which included ordinary shares issued to the depositary in exchange for a corresponding amount of ADSs for the purposes of ensuring that it has ADSs readily available to satisfy the vesting of restricted share units and the exercise of share options from time to time.
(4)
Includes (i) 7,871,562 Shares held by Mr. Oyler, (ii) Mr. Oyler’s entitlement to receive up to 20,705,156 Shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options, and (iii) Mr. Oyler’s entitlement to restricted share units equivalent to 510,411 Shares, subject to vesting conditions; (iv) 10,000,000 ordinary shares held for the benefit of
 
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Mr. Oyler in a Roth IRA PENSCO trust account; (v) 102,188 ordinary shares held by The John Oyler Legacy Trust, of which Mr. Oyler’s father is a trustee, for the benefit of his minor child, in which Mr. Oyler is deemed to be interested for the purpose of the SFO; (vi) 7,727,927 ordinary shares held for the benefit of Mr. Oyler in a grantor retained annuity trust, of which Mr. Oyler’s father is a trustee, in which Mr. Oyler is deemed to be interested for the purpose of the SFO; (vii) 29,439,115 ordinary shares held by Oyler Investment LLC, 99% of the limited liability company interest owned by a grantor retain annuity trust, for which Mr. Oyler’s father is a trustee, in which Mr. Oyler is deemed to be interested for the purpose of the SFO; (viii) 510,941 ordinary shares held by The Oyler Family Legacy Trust for the benefit of Mr. Oyler’s family members, of which Mr. Oyler’s father is a trustee and Mr. Oyler is the settlor; and (ix) 545,597 held by the P&O Trust, the beneficiaries of which include Mr. Oyler’s minor child and others, in which Mr. Oyler is deemed to be interested for the purpose of the SFO.
(5)
Includes (i) 6,798,107 Shares held by Dr. Wang, (ii) Dr. Wang’s entitlement to receive up to 9,594,450 Shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options, and (iii) Dr. Wang’s entitlement to restricted share units equivalent to 149,597 Shares, subject to vesting conditions; (iv) 50 ordinary shares held by Dr. Wang’s spouse; (v) 172,372 ordinary shares held in a UTMA account for Dr. Wang’s minor child, in which Dr. Wang is deemed to be interested for the purpose of the SFO; and (vi) 4,253,998 ordinary shares held by Wang Investment LLC, of which 99% of the limited liability company interest is owned by two grantor retained annuity trusts, of which Dr. Wang’s wife is a trustee, in which Dr. Wang is deemed to be interested for the purpose of the SFO.
(6)
Includes Mr. Hooper’s entitlement to receive up to 67,353 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(7)
Includes Mr. Chen’s entitlement to receive up to 460,340 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(8)
Includes (i) 2,907,829 ordinary shares held by Mr. Glazer; and (ii) Mr. Glazer’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(9)
Includes (i) 9,282 ordinary shares held by Mr. Goller; and (ii) Mr. Goller’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(10)
Includes (i) 9,282 ordinary shares held by Mr. Krishana and (ii) Mr. Krishana’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
(11)
Includes (i) 399,282 ordinary shares held by Mr. Malley and (ii) Mr. Malley’s entitlement to receive up to 850,166 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(12)
Includes Dr. Sanders is entitled to receive up to 27,482 ordinary shares pursuant to the exercise of options granted to her, subject to the conditions (including vesting conditions) of those options.
(13)
Includes Mr. Su is entitled to receive up to 173,277 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of those options.
(14)
Includes Mr. Yi’s entitlement to receive up to 327,418 ordinary shares pursuant to the exercise of options granted to him, subject to the conditions (including vesting conditions) of these options.
Financial effects of the Proposed RSU Grants
Under the 2016 Plan, the Grantees only receive shares when the RSUs are vested, and no funds will be raised by the Company as a result of the Proposed RSU Grants.
In accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 718, Compensation-Stock Compensation, all the Company’s grants of share-based
 
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awards to employees were classified as equity awards and are recognized in the financial statements based on their grant date fair values. The fair value of restricted shares and restricted share units are based on the closing market price of the Company’s ADSs on the NASDAQ Global Select Market on the date of grant. The Company has elected to recognize compensation expense using the straight-line method for all employee equity awards granted with graded vesting based on service conditions.
For awards granted to non-employees, the Company has accounted for equity instruments issued to non-employees in accordance with the provisions of ASC 718 and ASC 505, Equity. All transactions in which goods or services are received in exchange for equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Expense is recognized in the same manner as if the Group had paid cash for the services provided by the non-employees in accordance with ASC 505-50, Equity based payments to non-employees.
RECOMMENDATION
Having considered that (i) the Proposed RSU Grants aim to align the interests of the Grantees and the Company’s shareholders as a whole for the betterment of the Group’s future development and expansion; (ii) it is the market practice for listed companies of sizes similar to the Company’s to grant restricted share units/share awards to their directors, senior management and employees; and (iii) the experience and background of the relevant directors, we consider that (a) the terms of the Proposed RSU Grants are on normal commercial terms and fair and reasonable so far as the Independent Shareholders are concerned; and (b) the Proposed RSU Grants are conducted under the ordinary and usual course of business of the Company and in the interests of the Company and the shareholders as a whole. Accordingly, we advise the Independent Board Committees to recommend, and we recommend, that the Independent Shareholders vote in favor of the resolutions to be proposed at the Annual Meeting to approve the Proposed RSU Grants.
Yours faithfully,
For and on behalf of
Anglo Chinese Corporate Finance, Limited
 
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PROPOSAL 12
APPROVAL OF THE RSU GRANT TO MR. OYLER
The Company proposes an ordinary resolution at the Annual Meeting to approve the grant of RSUs with a grant date fair value of US$3,750,000 to Mr. John V. Oyler under the 2016 Plan. The grant date will be date of the Annual Meeting. The Proposed RSU Grant to Mr. Oyler will be made under the following terms:

each of the RSUs is granted for nil consideration;

each of the RSUs granted represents the right to receive one ordinary share on the date it vests;

25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service; provided, however, that upon a termination without cause or for good reason as defined in Mr. Oyler's employment agreement, the RSUs shall become vested as if he had remained employed for an additional 20 months; provided further that the RSUs shall become fully vested for underlying shares upon a change in control of the Company; and

the number of shares under the RSUs will be calculated by dividing the grant value by the closing price of the ADSs on NASDAQ on the grant date as divided by 13.
If the independent shareholders’ approval is not obtained at the Annual Meeting, the Proposed RSU Grant to Mr. Oyler shall be replaced by a share option grant with the same grant date fair value.
Why We Need Shareholder Approval
We are seeking shareholder approval in order to comply with Chapter 14A of the HK Listing Rules. Mr. Oyler as a director is a connected person of the Company under Chapter 14A of the HK Listing Rules. As a result, the Proposed RSU Grant to Mr. Oyler and transactions contemplated therein constitute non-exempt connected transactions of the Company under Chapter 14A of the HK Listing Rules and are subject to reporting, announcement and the independent shareholders’ approval requirements.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 12 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Mr. Oyler and his associates, who are required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 12 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR approval of the Proposed RSU Grant to Mr. Oyler and transactions contemplated therein.
 
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PROPOSAL 13
APPROVAL OF THE RSU GRANTS TO DR. WANG
The Company proposes an ordinary resolution at the Annual Meeting to approve the grant of RSUs with a grant date fair value of US$1,000,000 to Dr. Xiaodong Wang under the 2016 Plan. The grant date will be date of the Annual Meeting. The Proposed RSU Grant to Dr. Wang will be made under the following terms:

each of the RSU is granted for nil consideration;

each of the RSU granted represents the right to receive one ordinary share on the date it vests;

25% of the ordinary shares shall vest on each anniversary of the grant date, subject to continued service; and

the number of shares under the RSUs will be calculated by dividing the grant value by the closing price of the ADSs on NASDAQ on the grant date as divided by 13.
If the independent shareholders’ approval is not obtained at the Annual Meeting, the Proposed RSU Grant to Dr. Wang shall be replaced by a share option grant with the same grant date fair value.
Why We Need Shareholder Approval
We are seeking shareholder approval in order to comply with Chapter 14A of the HK Listing Rules. Dr. Wang as a director is a connected person of the Company under Chapter 14A of the HK Listing Rules. As a result, the Proposed RSU Grant to Dr. Wang and transactions contemplated therein constitute non-exempt connected transactions of the Company under Chapter 14A of the HK Listing Rules and are subject to reporting, announcement and the independent shareholders’ approval requirements.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 13 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Dr. Wang and his associates, who are required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 13 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR approval of the Proposed RSU Grant to Dr. Wang and transactions contemplated therein.
 
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PROPOSAL 14
APPROVAL OF THE RSU GRANTS TO NON-EXECUTIVE AND INDEPENDENT NON-EXECUTIVE DIRECTORS
The Company proposes an ordinary resolution at the Annual Meeting to approve the grant of RSUs with a grant date fair value of US$200,000 to each of the non-executive and independent non-executive directors, Mr. Anthony C. Hooper, Mr. Timothy Chen, Mr. Donald W. Glazer, Mr. Michael Goller, Mr. Ranjeev Krishana, Mr. Thomas Malley, Dr. Corazon (Corsee) D. Sanders, Mr. Jing-Shyh (Sam) Su and Mr. Qingqing Yi under the 2016 Plan. The grant date will be date of the Annual Meeting. The Proposed RSU Grants to these non-executive and independent non-executive directors will be made under the following terms:

each of the RSUs is granted for nil consideration;

each of the RSUs granted represents the right to receive one ordinary share on the date it vests;

100% of the ordinary shares shall vest upon the earlier to occur of the first anniversary of the grant date or the date of the next annual general meeting of shareholders; provided, however, that all vesting shall cease if the director resigns from the Board or otherwise ceases to serve as a director other than as set forth below or the Board determines that the circumstances warrant continuation of vesting. Unvested RSUs shall accelerate in full upon (i) death, (ii) disability, (iii) termination of service in connection with a change of control of the Company, or (iv) upon a change of control of the Company if the director's service continues and the awards are not assumed by the acquiror at the time of the change of control. Subject to specific terms and conditions designed for compliance with applicable tax and other regulations, a director generally may elect to defer settlement of their RSUs until six months following the date that the director ceases to serve as a director;

notwithstanding the above, the number of RSUs to be vested on the vesting date shall not cause the total number of shares held legally or beneficially by each of the independent non-executive directors, together with the total number of shares which may be issued to each of them or their nominee upon the exercise of any outstanding share options, convertible securities and other rights (whether contractual or otherwise) to call for the issue of shares, to exceed 1% of the total number of issued shares as of the vesting date after their vesting and issuance (the “1% threshold”);

if the number of RSUs to be vested on the vesting date would cause the total number of shares held legally or beneficially by each of the independent non-executive directors, together with the total number of shares which may be issued to each of them or their nominee upon the exercise of any outstanding share options, convertible securities and other rights (whether contractual or otherwise) to call for the issue of shares, to exceed the 1% threshold, the final number of RSUs to be vested on the vesting date shall be the maximum number of shares that may be issued to the relevant grantee while keeping their respective shareholding below the 1% threshold; and

the number of shares under the RSUs will be calculated by dividing the grant value by the closing price of the ADSs on NASDAQ on the grant date as divided by 13.
If the independent shareholders’ approval is not obtained at the Annual Meeting, each of the Proposed RSU Grants to Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi shall be replaced by a share option grant with the same grant date fair value.
Why We Need Shareholder Approval
We are seeking shareholder approval in order to comply with Chapter 14A of the HK Listing Rules. Each of Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi as a director is a connected person of the Company under Chapter 14A of the HK Listing Rules. As a result, the Proposed RSU Grants to these non-executive and independent non-executive directors and transactions contemplated therein constitute non-exempt connected transactions of the Company under Chapter 14A of the HK Listing Rules and are subject to reporting, announcement and the independent shareholders’ approval requirements.
 
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Vote Required and Board of Directors’ Recommendation
Approval of Proposal 14 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting excluding Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi and their respective associates, who are required to refrain or abstain from voting. Broker non-votes and abstentions with respect to Proposal 14 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR approval of the Proposed RSU Grants to Mr. Hooper, Mr. Chen, Mr. Glazer, Mr. Goller, Mr. Krishana, Mr. Malley, Dr. Sanders, Mr. Su and Mr. Yi and transactions contemplated therein.
 
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PROPOSAL 15
NON-BINDING, ADVISORY VOTE ON EXECUTIVE COMPENSATION
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and Section 14A of the Exchange Act, we are conducting a shareholder advisory vote on the compensation paid to our named executive officers. This proposal, commonly known as a “say-on-pay” vote, gives our shareholders the opportunity to express their views on our named executive officers’ compensation. The vote is advisory and therefore not binding on the Board of Directors, the Compensation Committee, or our Company. Nevertheless, the Compensation Committee will take into account the outcome of the vote when considering future executive compensation decisions. Based on the non-binding advisory vote regarding the frequency of future executive compensation advisory votes conducted at the 2018 annual general meeting, we currently intend to conduct this advisory vote annually until the next vote on the non-binding advisory frequency of such non-binding advisory votes, which will occur at our 2024 annual general meeting.
As described in detail in the section of this Proxy Statement titled “Executive Compensation — Compensation Discussion and Analysis,” our executive compensation program is designed to attract, motivate and retain our named executive officers, who are critical to our success. The Board of Directors believes that our executive compensation program is well-tailored to retain and motivate key executives while recognizing the need to align the program with the interests of our shareholders and our “pay-for-performance” philosophy. We believe that philosophy is working given the Company’s performance in 2020, which is discussed in more detail in the “Executive Compensation — Compensation Discussion and Analysis” section. During 2020, we made significant progress on our business and operational goals, including the expansion of our commercial portfolio, increasing product revenue as well as the inclusion of our medicines on the National Reimbursement Drug List in China, among other things. Our accomplishments are reflected in our total shareholder return (“TSR”), which is at the 86th percentile compared to our compensation peer companies for the year ended December 31, 2020 and at the 90th percentile for the time period since we went public on February 3, 2016. We encourage our shareholders to read the “Executive Compensation — Compensation Discussion and Analysis” section as well as the table in the section below of this Proxy Statement titled “Executive Compensation — Summary Compensation Table” and other related compensation tables and narrative disclosures in this Proxy Statement, which describe our executive compensation philosophy, programs, and practices and the 2020 compensation of our named executive officers.
We are asking our shareholders to indicate their support for the compensation of our named executive officers as described in this Proxy Statement. This vote is not intended to address any specific item of compensation but rather the overall compensation of our named executive officers and our executive compensation philosophy, programs, and practices as described in this Proxy Statement.
Accordingly, we ask our shareholders to vote “FOR” the approval, on an advisory basis, of the compensation of our named executive officers, as described in this Proxy Statement.
Vote Required and Board of Directors’ Recommendation
Advisory approval of Proposal 15 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 15 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote. The say-on-pay vote is advisory and therefore not binding on the Board of Directors, the Compensation Committee or our Company. However, the Board of Directors and the Compensation Committee value the opinion of our shareholders, and to the extent there is a significant vote against the compensation of our named executive officers as disclosed in this Proxy Statement, we will consider our shareholders’ concerns, and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.
The Board of Directors recommends that shareholders vote FOR approval, on an advisory basis, of the compensation of our named executive officers.
 
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PROPOSAL 16
RESTATED ARTICLES
General
The Board of Directors has approved, declared advisable and is recommending that our shareholders approve the Sixth Amended and Restated Memorandum and Articles of Association of the Company (the “Restated Articles”) to amend the Fifth Amended and Restated Memorandum and Articles of Association (the “Existing Articles”) at the Annual Meeting. Details of the proposed amendments to the Existing Articles are set out below. The following discussion is qualified in its entirety by reference to the proposed Restated Articles, a copy of which is attached to this Proxy Statement as Appendix A and is incorporated herein by reference. Appendix A is marked to show the proposed changes that would be made.
Background
The Board of Directors approved a preliminary proposal for the Proposed Issue of RMB Shares. In order to comply with the Rules Governing the Listing of Securities on the Science and Technology Innovation Board of the Shanghai Stock Exchange and other applicable PRC securities regulations (“SSE Rules”) as described in this Proxy Statement, the Company has proposed to amend certain provisions of the Existing Articles.
The Existing Articles are available on the websites of the Company (www.beigene.com) and Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk).
Description and Purpose of the Restated Articles
Transfer of Shares
In the proposed Restated Articles, we propose to amend the Existing Articles such that transfer of any shares through electronic transfer as recognized by the designated stock exchanges shall be deemed to satisfy the requirement of form of instrument of transfer under the Restated Articles.
Proceedings at General Meetings
In the proposed Restated Articles, we propose to amend the Existing Articles such that the Company could hold a general meeting of shareholders as a physical meeting, as a hybrid meeting or as an electronic meeting. To the extent required by the designated stock exchange rules, the Company shall facilitate shareholders of RMB Shares to attend a general meeting through an online voting platform, and such attendance by the shareholders shall be deemed to constitute presence in person at the meeting.
Exclusive Federal Forum
In the proposed Restated Articles, we propose to amend the Existing Articles such that unless the Company consents in writing to the selection of an alternative forum, the U.S. federal district courts shall be the sole and exclusive forum for resolving any complaints asserting a cause of actions under the U.S. Securities Act of 1933, as amended.
The Restated Articles also contain consequential changes to the amendments described above.
General Effects of the Restated Articles
After receipt of shareholder approval, the Restated Articles will become effective and will be filed with the Cayman Islands Registrar of Companies conditioned on and subject to the listing of the RMB Shares on the STAR Market. Prior to that, the Existing Articles shall continue to apply.
We believe that the Restated Articles provide adequate protections for shareholders. Our ADSs will continue to trade on the NASDAQ Global Select Market under the symbol “BGNE”, and our ordinary shares will continue to trade on the HKEx under the stock code “06160”.
 
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Vote Required and Board of Directors’ Recommendation
Approval of Proposal 16 requires the favorable vote of at least a two-thirds majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 16 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the adoption of the Restated Articles.
 
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PROPOSAL 17
ADJOURNMENT PROPOSAL
General
If the Annual Meeting is convened and a quorum is present, but there are not sufficient votes to approve any one or more of Proposals 1 through 16, the chairman of the meeting may move to adjourn the Annual Meeting at that time in order to enable the Board of Directors to solicit additional proxies in favor of such proposal(s).
In the Adjournment Proposal, we are asking our shareholders to authorize the holder of any proxy solicited by the Board of Directors to vote in favor of adjourning the Annual Meeting to another time and place, if necessary, to solicit additional proxies in the event there are not sufficient votes to approve any one or more of Proposals 1 through 16. If our shareholders approve this proposal, we could adjourn the Annual Meeting and any adjourned session of the Annual Meeting and use the additional time to solicit additional proxies, including the solicitation of proxies from our shareholders that have previously voted. Among other things, approval of the Adjournment Proposal could mean that, even if we receive proxies representing a sufficient number of votes to defeat any of Proposals 1 through 16, we could adjourn the Annual Meeting without a vote on such proposal(s) and seek to convince our shareholders to change their votes in favor of such proposal(s).
If it is necessary to adjourn the Annual Meeting, no notice of the adjournment or the business to be transacted at the adjourned meeting is required to be given to our shareholders, so long as the meeting is adjourned for less than 14 days. At the adjourned meeting, no business shall be transacted other than the business left unfinished at the meeting from which the adjournment took place.
Vote Required and Board of Directors’ Recommendation
Approval of Proposal 17 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 17 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.
The Board of Directors recommends that shareholders vote FOR the approval of the Adjournment Proposal, if necessary, to solicite additional proxies.
 
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TRANSACTION OF OTHER BUSINESS
The Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting as of the date of this Proxy Statement. If any other matters are properly brought before the Annual Meeting, the person(s) named in the accompanying proxy intend to vote on such matters in accordance with their best judgment.
 
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information known to us regarding beneficial ownership of our share capital as of April 1, 2021 by:

each person, or group of affiliated persons, known by us to be the beneficial owner of more than 5% of any class of our voting securities;

each of our named executive officers;

each of our directors; and

all of our executive officers and directors as a group.
Beneficial ownership set forth below is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities, except as otherwise provided. The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules. Except as noted by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole voting and investment power with respect to all securities shown as beneficially owned by them.
The table lists applicable percentage ownership based on 1,197,322,617 ordinary shares outstanding as of April 1, 2021 and also lists applicable percentage ownership. Any options to purchase ordinary shares that are exercisable and restricted share units (“RSUs”) that will vest within 60 days of April 1, 2021 are deemed to be beneficially owned by the persons holding these options and RSUs for the purpose of computing percentage ownership of such persons, but are not treated as outstanding for the purpose of computing any other person’s ownership percentage. Beneficial ownership representing less than 1% is denoted with an asterisk (*).
Unless otherwise noted below, the address of each person listed on the table is: c/o Mourant Governance Services (Cayman) Limited, 94 Solaris Avenue, Camana Bay, Grand Cayman KY1-1108, Cayman Islands.