Dida Inc. — Capital/Financing Update 2011

Jan 31, 2011

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

This announcement is for information purposes only and is not an offer to sell or the solicitation of an offer to buy securities and neither this announcement nor anything herein forms the basis for any contract or commitment whatsoever. The securities described herein will be sold in accordance with all applicable laws and regulations. This announcement appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities of the Company.

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CHINA SHIPPING DEVELOPMENT COMPANY LIMITED 中海發展股份有限公司

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 1138)

PROPOSAL FOR THE ISSUE OF BONDS CONVERTIBLE INTO NEW A SHARES OF THE COMPANY AND RESUMPTION OF TRADING

Issue of Convertible Bonds

The Board is pleased to announce the conditional proposal for the Company to issue Convertible Bonds in principal amount equal to or not more than RMB3.95 billion (equivalent to approximately HK$ 4.59 billion) convertible into new A Shares. The initial conversion price of the A Shares which may fall to be issued upon conversion of the Convertible Bonds will not be lower than the higher of the average of the trading prices of the A Shares for the 20 trading days immediately before the issue of the relevant offering memorandum and the average trading price of the A Shares on the trading day immediately preceding the issue of the aforesaid memorandum, and shall be determined by the Board and such other person authorised by the Board (as authorized by Shareholders in a general meeting) by reference to market conditions and in consultation with the sponsor and the lead underwriter of this transaction. The Convertible Bonds are proposed to be in the

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form of RMB denominated convertible bonds. The Bond Issue is conditional upon, among other things, obtaining approvals from (i) SASAC; (ii) the Shareholders at the EGM and the respective class meetings of H Shareholders and A Shareholders; and (iii) the CSRC. An application is expected to be made to have the Convertible Bonds and the related conversion shares listed on the Shanghai Stock Exchange. The underwriting arrangements of the Bond Issue (if any) have not been finalized at this stage.

Offer of Convertible Bonds to be made in the PRC only

The Convertible Bonds are expected to be offered to natural persons, legal persons, securities investment funds and other investors who have complied with the relevant laws and regulations and who are holders of securities accounts opened at the Shanghai Branch of China Securities Depositary and Clearing Corporation Limited (save for those prohibited by PRC laws and regulations). The proportions of the Bond Issue to be designated for subscription between the existing shareholders of A Shares and those who are not existing shareholders of A Shares have yet to be determined. In any event, within the tranche of Convertible Bonds allocated to existing A Shareholders, they will be entitled to subscribe for the Convertible Bonds pro rata their shareholdings of A Shares and in priority to others who are not A Shareholders. There will be a public offering of the Convertible Bonds in the PRC only. No offering document will be issued or circulated in Hong Kong or to any member of the public in Hong Kong.

Use of proceeds

The purpose of the issue of the Convertible Bonds is to enable the Company to fund the ongoing vessel constructions already contracted by the Company. Based on the gross proceeds of RMB3.95 billion (equivalent to approximately HK$4.59 billion), the Board expects to utilise approximately RMB1,013,950,000 (equivalent to approximately HK$1.2 billion) for the construction of three oil tankers of 110,000 dead weight tonnes each, approximately RMB924,950,000 (equivalent to approximately HK$1.1 billion) for the construction of eight oil tankers of 48,000 dead weight tonnes each, approximately RMB360,270,000 (equivalent to approximately HK$418.9 million) for the construction of two VLCCs of 308,000 dead weight tonnes each, and approximately RMB1,650,830,000 (equivalent to approximately HK$1.9 billion) for the construction of six bulk cargo carriers of 76,000 dead weight tonnes each. The proportions of the funds to be utilised for the above purposes may be adjusted by the Board based on the actual demand. However, if further funds are required for

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the vessel constructions, or should the Convertible Bonds were not issued or the Bond Issue not completed at the relevant time, it will be financed by bank loans, general working capital and/or other resources.

EGM and Class Meetings

The Company proposes to convene the EGM, a class meeting for shareholders of H Shares and a class meeting for shareholders of A Shares separately to consider and, if thought fit, approve the Bond Issue. Notices convening the EGM and the respective class meetings will be sent to the H Shareholders and A Shareholders of the Company separately.

RESUMPTION OF TRADING

At the request of the Company, trading in the Shares on the Stock Exchange was suspended with effect from 9:30 a.m. on 31 January 2011 pending the release of this announcement. Application has been made by the Company to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on 1 February 2011.

PROPOSED BOND ISSUE

The board (the “ Board ”) of directors (the “ Directors ”) of China Shipping Development Company Limited (the “ Company ”) is pleased to announce its conditional proposal to issue Convertible Bonds (“ Bond Issue ”) in principal amount equal to or not more than RMB 3.95 billion (equivalent to approximately HK$4.59 billion) (“ Convertible Bonds ”) convertible into new A shares with face value of RMB1.00 each (“ A Shares ”) of the Company. The initial conversion price of the A Shares which may fall to be issued upon conversion of the Convertible Bonds will not be lower than the higher of the average of the trading prices of the A Shares for the 20 trading days immediately before the issue of the relevant offering memorandum and the average trading price of the A shares on the trading day immediately preceding the issue of the aforesaid memorandum, and shall be determined by the Board and such other person authorized by the Board (as authorized by shareholders of the Company (the “ Shareholders ”) in a general meeting) by reference to market conditions and in consultation with the sponsor and lead underwriter of this transaction. The Convertible Bonds are proposed to be in the form of RMB denominated convertible bonds. The proposed Bond Issue is conditional upon, among other things, obtaining approvals from (i) the State-owned Assets Supervision and Administration Commission of the State Council (“ SASAC ”); (ii) the Shareholders at

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the extraordinary general meeting (“ EGM ”) and the respective class meetings of H Share (the “ H Shares ”) shareholders (the “ H Shareholders ”) and A Shareholders; and (iii) the China Securities and Regulatory Commission (“ CSRC ”).The underwriting arrangements of the Bond Issue (if any) have not been finalized at this stage.

OFFER OF CONVERTIBLE BONDS TO BE MADE IN THE PRC ONLY

The Convertible Bonds are expected to be offered to natural persons, legal persons, securities investment funds and other investors who have complied with the relevant laws and regulations, who are holders of securities accounts opened at the Shanghai Branch of China Securities Depositary and Clearing Corporation Limited (save for those prohibited by the Peoples Republic of China (“ PRC ”) laws and regulations). The proportions of the Bond Issue to be designated for subscription between the existing shareholders of A Shares and those who are not existing shareholders of A Shares have yet to be determined. In any event, within the tranche of Convertible Bonds allocated to existing A Share shareholders (the “ A Shareholders ”), they will be entitled to subscribe for the Convertible Bonds pro rata their shareholdings of A Shares and in priority to others who are not A Shareholders. There will be a public offering of the Convertible Bonds in the PRC only. No offering document will be issued or circulated in Hong Kong or to any member of the public in Hong Kong.

SUMMARY OF THE PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSED BOND ISSUE

The current proposed principal terms and conditions of the Bond Issue are summarized as follows (such terms and conditions will have to be approved by the CSRC and be finalised in the relevant offering memorandum):

Total issuing amount:

Equal to or not more than RMB 3.95 billion (equivalent to approximately HK$4.59 billion). The actual total issuing amount will be determined by the Board and such other persons authorized by the Board (as authorized by the Shareholders in a general meeting) but shall be subject to the above ceiling.

Bond maturity: 6 years Issue price: According to the face value of the Convertible Bonds which will be issued in integral principal amounts of RMB100 (equivalent to approximately HK$116).

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Interest:

The range of interest rates is preliminarily estimated to be from 0.5% to 3.0% per annum. The actual interest rate will be determined by the Board and such other persons authorised by the Board (as authorized by the Shareholders in a general meeting) after consultation with the sponsor (lead underwriter) and taking into account state policies, market conditions and the requirements of the Company. Should there be any depositary interest rate changes by commercial banks, the Board shall determine the coupon rate accordingly as authorized by the Shareholders (where applicable).

Interest will be payable annually commencing from the first anniversary of the Bond Issue with actual payment to be made within 5 trading days immediately after each anniversary date.

Conversion price:

The initial conversion price of the Convertible Bonds will not be lower than the higher of the average of the trading prices of the A Shares for the 20 trading days immediately before the issue of the relevant offering memorandum and the average trading price of the A shares on the trading day immediately preceding the issue of the aforesaid memorandum, and shall be determined by the Board and such other person authorized by the Board (as authorized by Shareholders in a general meeting) by reference to market conditions, relevant status of the Company and in consultation with the sponsor and the lead underwriter of this transaction.

Conversion price will be subject to adjustment in the event of bonus issues of shares, rights issue, conversion of common reserve into share capital, issue or placement of new shares (other than as a result of conversion of the Convertible Bonds), , payment of cash dividends and other events which would have an impact on the classes or number of issued shares of the Company.

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During the conversion period of the Convertible Bonds, in the event that the closing prices of the A Shares for at least 10 trading days out of any 30 consecutive trading days are lower than 90% of the then conversion price, the Board is entitled to propose a special resolution to the Shareholders in a general meeting for a downward adjustment of the conversion price. Holders of the Convertible Bonds shall abstain from voting on such resolution. The adjusted conversion price shall not be lower than the higher of (i) the average of the trading prices of the A Shares for the 20 trading days immediately before the meeting of the Shareholders held to consider and approve the said conversion price adjustment; (ii) the average trading price of the A Shares on the trading day immediately preceding the aforesaid general meeting; (iii) the net asset value per A Share based on the latest audited financial statement; and (iv) the nominal value per A Share.

Conversion mechanism:

Conversion period:

Applications to convert to A Shares may be made by the holders of the Convertible Bonds at any time during the conversion period in accordance with the conditions set out in the relevant offering memorandum at the conversion price then effective during the conversion period where processing of the conversion applications are not suspended. Holders of the Convertible Bonds may convert all or part of the Convertible Bonds. No fractional shares will be issued, the relevant Convertible Bond holder shall receive cash instead where applicable.

At any time from and including the first trading day immediately after the expiry of the six months period commencing from the completion of issue of the Convertible Bonds, up to the maturity date of the Convertible Bonds.

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• Redemption on maturity:

• The Company shall redeem all outstanding Convertible Bonds within five trading days from the maturity date at no more than 105% of the nominal value of the Convertible Bonds (inclusive of accrued interest). The actual redemption price will be determined by the Board and such other persons authorized by the Board (as authorized by the Shareholders in a general meeting) after consultation with the sponsor and the lead underwriter and in accordance with state policies, market conditions and the requirements of the Company.

• Redemption at the During the conversion period of the Convertible Bonds, option of the in the event that either (i) the closing price of the A Company: Shares for at least 15 trading days out of any 30 consecutive trading days shall be no less than 130% of the then conversion price, or (ii) the principal amount of Convertible Bonds outstanding is less than RMB30,000,000, the Company shall be entitled to redeem all or part of the Convertible Bonds then outstanding in accordance with the specified redemption procedures at the face value of the Convertible Bonds plus accrued interest.

• Sale back at the option During the final two years of the convertible period of the holders of the where interests will normally be accrued, in the event Convertible Bonds: that the closing prices of the A Shares in any 30 consecutive trading days shall be lower than 70% of the then conversion price, the holders of the Convertible Bonds have a one-off right to require the Company to redeem all or part of the Convertible Bonds held by them at the face value of the Convertible Bonds plus accrued interest (if any). In the event the relevant holder of the Convertible Bonds does not apply for such redemption within the relevant redemption period, such holder shall not exercise the right of redemption in connection with such instance of triggering event within the same year.

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If the Shareholders approve a change in the use of proceeds from the issue of the Convertible Bonds or CSRC deems that there has been a material change in the use of the same proceeds, the holders of the Convertible Bonds will have a one-off right to require the Company to redeem all or part of the Convertible Bonds held by them at the face value of the Convertible Bonds plus accrued interest (if any). In the event the relevant holder of the Convertible Bonds does not apply for such redemption within the relevant redemption period, such holder shall not exercise the right of redemption in connection with such instance of triggering event within the same period.

Target subscribers:

Natural persons, legal persons, securities investment funds and other investors who have complied with the relevant laws and regulations, who are holders of securities accounts opened at the Shanghai Branch of China Securities Depositary and Clearing Corporation Limited (save for those prohibited by PRC laws and regulations). The actual arrangements for subscription will be determined by the Board and such other person authorized by the Board (as authorized by the Shareholders in a general meeting) after consultation with the sponsor and the lead underwriter.

Listing of bonds:

An application is expected to be made to the Shanghai Stock Exchange for the listing of the Convertible Bonds and the related conversion shares on the Shanghai Stock Exchange.

The existing holders of A Shares shall have preferential rights to subscribe for the Convertible Bonds proposed to be issued. The actual amount of Convertible Bonds to be preferentially allocated to the existing holders of A Shares shall be determined by the Board and such other person authorized by the Board (as authorized by Shareholders in a general meeting) with reference to market conditions at the time of the issue. The amount of preferential allocation will be announced in due course. The balance amount of the Convertible Bonds after allocation to the existing holders of A Shares on a preferential basis and the Convertible Bonds, the preferential right of which have been given up by the existing holders of A Shares, will be issued by way

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of offline placement to institutional investors and/or online issuance through the system of Shanghai Stock Exchange. If the Convertible Bonds are not fully subscribed, the remainder of the Convertible Bonds will be underwritten by the underwriting syndicate.

In any event, within the tranche of Convertible Bonds allocated to existing A Shareholders, they will be entitled to subscribe for the Convertible Bonds pro rata their shareholdings of A Shares and in priority to others who are not A Shareholders. There will be a public offering of the Convertible Bonds in the PRC only. The timing of the Bond Issue will be determined by the Board after careful consideration and taking into account the prevailing market conditions and all other relevant factors at the time. The actual terms and conditions of the Convertible Bonds will be determined by the Board prior to the Bond Issue.

PROPOSED USE OF PROCEEDS

The purpose of the issue of the Convertible Bonds is to enable the Company to fund the ongoing vessel constructions already contracted by the Company. Based on the gross proceeds of RMB3.95 billion (equivalent to approximately HK$4.59 billion), the Board expects to utilise approximately RMB1,013,950,000 (equivalent to approximately HK$1.2 billion) for the construction of three oil tankers of 110,000 dead weight tonnes each, approximately RMB924,950,000 (equivalent to approximately HK$1.1 billion) for the construction of eight oil tankers of 48,000 dead weight tonnes each, approximately RMB360,270,000 (equivalent to approximately HK$418.9 million) for the construction of two VLCCs of 308,000 dead weight tonnes each, and approximately RMB1,650,830,000 (equivalent to approximately HK$1.9 billion) for the construction of six bulk cargo carriers of 76,000 dead weight tonnes each. The proportions of the funds to be utilised for the above purposes may be adjusted by the Board based on actual demand. However, if further funds are required for the vessel constructions, or should the Convertible Bonds were not issued or the Bond Issue not completed at the relevant time, it will be financed by bank loans, general working capital and/or other resources.

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REASONS FOR THE BOND ISSUE

The Board has carefully considered different financing options for the funding requirements of the Company. It believes that the Bond Issue is the most appropriate option for the Company for the following reasons:

• (a) the Bond Issue, as a convertible bond issue, would generally allow the Company to pay a lower interest coupon payment than for a straight bond issue; and

• (b) the Bond Issue would not lead to any immediate dilution of the Company’s basic earnings per share which would arise in the case of a new issue of A Shares.

IMPACT OF THE BOND ISSUE ON CAPITAL STRUCTURE OF THE COMPANY

Upon conversion of the Convertible Bonds, there would be an increase in the number of A Shares held by the public. Shareholders’ equity interest in the Company will be diluted as a result of the exercise of the conversion rights attached to the Convertible Bonds. The exact size of the above increase in number of A Shares will depend on the final terms of the Convertible Bonds, including, amongst other terms, the conversion price at which the Convertible Bonds will be converted into A Shares. It is currently contemplated that the initial conversion price will be determined with reference to a premium over the higher of the average trading price of A Shares for 20 trading days immediately prior to the issue of the relevant offering memorandum and the average trading price of the A shares on the trading day immediately preceding the issue of the aforesaid memorandum. The final terms of the Convertible Bonds are expected to be determined by the Board and such other person authorized by the Board (as anthorized by Shareholders in a general meeting) by reference to market conditions and in consultation with the sponsor and the lead underwriter of this transaction.

Based on information available as at the date of this announcement and for illustrative purposes only, the conversion price floor is the average of the trading prices of the A Shares for the 20 trading days immediately before the date of this announcement, being the higher of the conditions set out above in relation to conversion price. The average trading price for such period is RMB9.64 and on this basis, the maximum number of conversion shares issuable under RMB3.95 billion worth of Convertible Bonds would be 409,751,037 A Shares.

As the proportion of Convertible Bonds to be allocated to existing A Shareholders and investors who are not existing A Shareholders are yet to be determined, for illustrative purposes only and assuming all Convertible Bonds are only issued to existing A Shareholders, upon full conversion of the Convertible Bonds and using the

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conversion price of RMB9.64 (being the average trading price of the A Shares for the last 20 trading days ending on 28 January 2011 before the suspension of trading in the Shares on 31 January 2011), the percentage of shareholding of the existing Shareholders are as follows (taking into account no fractional shares to be issued):

China Shipping (Group) Company* A Shares (public) H shares (public) Public	Number of Shares immediately before conversion in full of the Convertible Bonds Percentage of shareholding immediately before conversion in full of the Convertible Bonds Number of Shares immediately after conversion in full of the Convertible Bonds Percentage of shareholding immediately after conversion in full of the Convertible Bonds 1,578,500,000 46.36% 1,885,246,966 49.43% 530,052,270 15.57% 633,056,340 16.60% 1,296,000,000 38.07% 1,296,000,000 33.97% 1,826,052,270 53.64% 1,929,056,340 50.57% 3,404,552,270 100% 3,814,303,306 100%	Number of Shares immediately before conversion in full of the Convertible Bonds Percentage of shareholding immediately before conversion in full of the Convertible Bonds Number of Shares immediately after conversion in full of the Convertible Bonds Percentage of shareholding immediately after conversion in full of the Convertible Bonds 1,578,500,000 46.36% 1,885,246,966 49.43% 530,052,270 15.57% 633,056,340 16.60% 1,296,000,000 38.07% 1,296,000,000 33.97% 1,826,052,270 53.64% 1,929,056,340 50.57% 3,404,552,270 100% 3,814,303,306 100%
		50.57%
		100%

• China Shipping (Group) Company currently holds 74.86% of the total issued A Shares. As the Convertible Bonds are being offered on a pro rata basis to existing shareholders of A Shares in priority to other eligible persons, this percentage of shareholding immediately after conversion in full of the Convertible Bonds assumes that China Shipping will take up its priority right to subscribe for its pro rata share of the Convertible Bonds.

The Directors do not currently expect that the Bond Issue will adversely affect the minimum number of shares of the Company and H Shares which are, under the Listing Rules, required to be held by members of the public. If there is such adverse effect, the Company intends to adopt necessary measures to meet the relevant requirement(s). Upon full conversion of the Convertible Bonds, there will not, by reason only of such conversion, result in any change in control of the Company. Further announcements will be made once the terms and conditions of the Convertible Bonds are determined and the relevant offering memorandum is issued.

Any new A Shares to be issued upon conversion of the Convertible Bonds will rank pari passu with, and within the same class as, the A Shares in issue on the relevant conversion date in all respects, save in respect of entitlement to dividends and other distributions which will depend on, inter alia, the conversion date(s) for the Convertible Bonds.

FUND RAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Company has not conducted any equity fund raising activities in the previous 12 months immediately preceding the date of this announcement.

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EGM AND CLASS MEETINGS

Under the Company Law of the PRC and the Company’s articles of association, the Bond Issue is subject to the approval of the Shareholders. It is proposed that resolutions for the approval of the Bond Issue will be put to the Shareholders for their consideration at the EGM and/or the respective class meetings of the holders of A shares and H Shares (where applicable). In relation to the Bond Issue, the relevant resolutions to be passed at the EGM and/or relevant class meetings (where applicable) can be generally categorised into (a) eligibility of the Company to issue the Convertible Bonds, (b) terms of the Bond Issue, (c) feasibility of use of proceeds from the Bond Issue on investment projects, (d) report on the use of proceeds from the previous convertible bond issued by the Company on 2 July 2007 and (e) authorisation of the Board and such other persons authorized by the Board to take such actions as may be necessary or desirable to complete the Bond Issue. The Company is not aware of any Shareholder who is obliged to abstain from voting on the resolutions. The notice of the EGM and the respective class meetings will be given to the holders of the Company’s H Shares and A Shares separately.

Upon approval of the Bond Issue at the EGM and the respective class meetings, the issue of the Convertible Bond will still be subject to the approval of CSRC. The timing of the Bond Issue shall be subject to the approval of CSRC, as well as the bond market conditions in the PRC. Further announcement will be made by the Company when the CSRC’s approval has been obtained and the maturity period and the coupon rate of the Convertible Bonds have been fixed.

RESUMPTION OF TRADING

At the request of the Company, trading in the Shares on the Stock Exchange was suspended with effect from 9:30 a.m. on 31 January 2011 pending the release of this announcement. Application has been made by the Company to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on 1 February 2011.

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This announcement is made in compliance with the simultaneous dissemination of information requirement under Rule 13.09(2) of the Listing Rules as well as pursuant to the Rule 13.09(1) of the Listing Rules. The Company’s A shares are listed on the Shanghai Stock Exchange, and it has made an announcement similar to this announcement at the Shanghai Stock Exchange.

By Order of the Board of Directors China Shipping Development Company Limited Yao Qiaohong Company Secretary

Shanghai, the People’s Republic of China

31 January 2011

Note: Unless otherwise specified, the conversion of RMB into HK$ is based on the exchange rate of HK$1.00=RMB0.86 and is for illustration purpose only.

As at the date of this announcement, the Board of Directors of the Company comprises of Mr. Li Shaode, Mr. Ma Zehua, Mr. Lin Jianqing, Mr. Wang Daxiong, Mr. Zhang Guofa and Mr. Qiu Guoxuan as executive Directors, Mr. Zhu Yongguang, Mr. Gu Gongyun, Mr. Zhang Jun and Mr. Lu Wenbin as independent non-executive Directors.

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