DIT Group Limited - Capital/Financing Update 2015

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 appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities.

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(Incorporated in Bermuda with limited liability) (Stock Code: 726)

(1) PROPOSED ISSUE OF NEW SHARES UNDER SPECIFIC MANDATE (2) WHITEWASH WAIVER (3) PROPOSED ISSUE OF CONVERTIBLE BONDS (4) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL AND

(5) RESUMPTION OF TRADING

Financial adviser to the Share Subscriber

Financial adviser to the Company

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

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PROPOSED ISSUE OF NEW SHARES UNDER SPECIFIC MANDATE

On 9 February 2015, the Share Subscriber and the Company entered into the Share Subscription Agreement pursuant to which the Share Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to issue and allot, on the Share Subscription Completion Date, 6,500,000,000 new Shares which has been determined by dividing HK$1,300,000,000 (being the total subscription consideration under the Share Subscription Agreement) by HK$0.20 (being the Subscription Price per Subscription Share).

The Subscription Shares represent:

(a) approximately 1.75 times of the existing issued share capital of the Company;
(b) approximately 63.67% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares; and
(c) approximately 57.99% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares and the Conversion Shares (assuming that the Convertible Bonds will be fully converted and there are no other changes to the issued share capital of the Company).

Completion of the Share Subscription is conditional upon, among others, the terms and conditions as set forth in the Share Subscription Agreement.

WHITEWASH WAIVER

Upon completion of the Share Subscription, the Share Subscriber (and its nominee(s) for the purpose of the Share Subscription) and parties acting in concert with it will hold approximately 6,500,000,000 Shares, representing approximately 63.67% of the issued share capital of the Company as enlarged by the issue of the Subscription Shares. The Share Subscriber and parties acting in concert with it will incur an obligation pursuant to Rule 26 of the Takeovers Code to make a mandatory general offer to the Shareholders to acquire all the Shares other than those held or agreed to be acquired by the Share Subscriber and parties acting in concert with it.

The Share Subscriber will make an application to the Executive for the granting of the Whitewash Waiver, which if granted, will be subject to, among other things, approval by the Independent Shareholders in respect of the Share Subscription and the Whitewash Waiver at the SGM by way of poll.

PROPOSED ISSUE OF CONVERTIBLE BONDS

On 9 February 2015, the CB Subscriber and the Company entered into the CB Subscription Agreement pursuant to which the Company has conditionally agreed to issue, and the CB Subscriber has conditionally agreed to subscribe for, the Convertible Bonds in an aggregate principal amount of HK$200,000,000.

Assuming full subscription of the Convertible Bonds on the CB Subscription Completion Date and full conversion of the Convertible Bonds, 1,000,000,000 Conversion Shares will be allotted and issued to the bondholder(s). The 1,000,000,000 Conversion Shares to be allotted and issued represent: (i) approximately 26.96% of the existing issued share capital of the Company as at the date of this announcement; (ii) approximately 21.23% of the issued share capital of the Company as enlarged by the allotment and issue of the 1,000,000,000 Conversion Shares; and (iii) approximately 8.92% of the issued share capital of the Company as enlarged by the allotment and issue of the 6,500,000,000 Subscription Shares and the 1,000,000,000 Conversion Shares.

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

In order to undertake the Share Subscription, and the potential issue of Conversion Shares (assuming full conversion of the Convertible Bonds), the Board proposes to increase the authorised share capital of the Company from HK$400,000,000 divided into 4,000,000,000 Shares to HK$2,500,000,000 divided into 25,000,000,000 Shares by the creation of an additional 21,000,000,000 Shares, which will, upon issue as fully paid, rank pari passu in all respects with the Shares in issue.

SGM

The SGM will be held to consider, and if thought fit, pass the resolutions to approve, among other things, (i) the Increase in Authorised Share Capital; (ii) the Share Subscription Agreement and the transactions contemplated thereunder; (iii) the CB Subscription Agreement and the transactions contemplated thereunder; (iv) the granting of the Specific Mandates for the allotment and issue of the Subscription Shares and the Conversion Shares; and (v) the Whitewash Waiver. As at the date of this announcement, the Share Subscriber and parties acting in concert with it do not hold any Shares or other securities in the Company and accordingly will not vote on any of the resolutions to be proposed at the SGM. The CB Subscriber and its ultimate beneficial owner do not hold any Shares or other securities in the Company and accordingly will not vote on any of the resolutions to be proposed at the SGM. Only Shareholders who do not have a material interest or who are not involved in or interested in the Share Subscription, the CB Subscription and the Whitewash Waiver will vote on the aforesaid resolutions.

GENERAL

The Independent Board Committee has been established to advise the Independent Shareholders in relation to the Share Subscription and the Whitewash Waiver. Nuada Limited has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Share Subscription and the Whitewash Waiver. The appointment of Nuada Limited has been approved by the Independent Board Committee.

A circular containing, among other things, (i) further information on the Increase in Authorised Share Capital, the Share Subscription, the CB Subscription and the Whitewash Waiver; (ii) a letter of advice from the Independent Board Committee to the Independent Shareholders in relation to the Share Subscription Agreement and the transactions contemplated thereunder and the Whitewash Waiver; (iii) a letter of advice from the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Share Subscription Agreement and the transactions contemplated thereunder and the Whitewash Waiver; and (iv) a notice convening the SGM and a form of proxy are expected to be despatched to the Shareholders on or before 30 March 2015.

If the Whitewash Waiver is not granted or any of the conditions precedent to the completion of the Share Subscription is not satisfied, the Share Subscription will lapse and will not proceed. Shareholders and potential investors of the Company should exercise caution when dealing in the Shares or other securities of the Company.

Completion of each of the Share Subscription and the CB Subscription is subject to the fulfilment of the conditions precedent in each of the Share Subscription Agreement and the CB Subscription Agreement respectively. The Share Subscription and the CB Subscription are not inter-conditional. As the Share Subscription and/or the CB Subscription may or may not proceed, Shareholders and potential investors are advised to exercise caution when dealing in the Shares or other securities of the Company.

RESUMPTION OF TRADING

At the request of the Company, trading in the Shares on the Stock Exchange was suspended with effect from 9:00 a.m. on 9 February 2015 pending the release of this announcement. Application has been made by the Company for the resumption of trading in the Shares on the Stock Exchange with effect from 9:00 a.m. on 9 March 2015.

PROPOSED ISSUE OF NEW SHARES

On 9 February 2015, the Share Subscriber and the Company entered into the Share Subscription Agreement pursuant to which the Share Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to allot and issue, on the Share Subscription Completion Date, 6,500,000,000 new Shares which has been determined by dividing HK$1,300,000,000 (being the total subscription consideration under the Share Subscription Agreement) by HK$0.20 (being the Subscription Price per Subscription Share).

Principal terms of the Share Subscription Agreement

Date:

9 February 2015

Parties:

(a) The Company, as the issuer of the Subscription Shares; and
(b) The Share Subscriber, as the subscriber of the Subscription Shares.

Total subscription consideration: HK$1,300,000,000 Subscription Price per Subscription Share: HK$0.20

The Subscription Shares represent:

(a) approximately 1.75 times of the existing issued share capital of the Company;
(b) approximately 63.67% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares; and
(c) approximately 57.99% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares and the Conversion Shares (assuming that the Convertible Bonds will be fully converted and there are no other changes to the issued share capital of the Company).

Ranking of the Subscription Shares

The Subscription Shares, when allotted and issued, will rank pari passu in all respects among themselves and with the Shares in issue as at the date of allotment and issue of the Subscription Shares, including the right to receive all future dividends and distributions which may be declared, made or paid by the Company on or after the date of allotment and issue of the Subscription Shares.

The Subscription Price

The Subscription Price of HK$0.20 per Subscription Share represents:

(a) a discount of approximately 42.86% to the closing price of HK$0.35 per Share on the Stock Exchange on the Last Trading Day;
(b) a discount of approximately 35.06% to the average closing price of approximately HK$0.308 per Share for the last 5 trading days up to and including the Last Trading Day;

(c) a discount of approximately 23.37% to the average closing price of approximately HK$0.261 per Share for the last 30 trading days up to and including the Last Trading Day;
(d) a discount of approximately 19.35% to the average closing price of approximately HK$0.248 per Share for the last 60 trading days up to and including the Last Trading Day; and
(e) a premium of approximately 16.96% to the average closing price of approximately HK$0.171 per Share for the last 180 trading days up to and including the Last Trading Day.

In addition, by reference to the net liability position of the Company as of 30 September 2014 of approximately HK$7.88 million (equivalent to a negative amount of approximately HK$0.022 per Share based on 364,955,880 Shares then in issue), the Subscription Price represents a substantial premium over this amount. In October 2014, the Company has completed an equity fund raising exercise by way of rights issue and raised net proceeds of approximately HK$283 million. Based on the net liability of the Company as at 30 September 2014, and taking into account the net proceeds from the aforementioned rights issue and based on the 3,709,602,920 Shares in issue as at the date of this announcement, the adjusted estimated net asset value of the Company is approximately HK$0.074 per Share. The Subscription Price therefore represents a premium of over 170% to the adjusted estimated net asset value per Share of the Company.

The net aggregate proceeds from the Share Subscription, after deduction of relevant expenses (including but not limited to the legal expenses and disbursements), is estimated to be approximately HK$1,296 million. The net price per Subscription Share is approximately HK$0.199 after deduction of relevant expenses of the Share Subscription.

The Subscription Price was determined after arm’s length negotiations between the Company and the Share Subscriber with reference to the recent closing prices of the Shares on the Stock Exchange and the financial position of the Group. The Directors (other than the non-executive Directors who have no direct or indirect interest in the Share Subscription, who will be advised by the independent financial adviser) consider that the Share Subscription Agreement has been entered into upon normal commercial terms and the terms of the Share Subscription Agreement (including, without limitation, the Subscription Price) are fair and reasonable and in the interest of the Company and the Shareholders as a whole.

Conditions for the Share Subscription

Completion of the Share Subscription is conditional upon the satisfaction (if applicable, waiver) of the following conditions:

(a) Shareholders approving at the SGM the Increase in Authorised Share Capital;
(b) Independent Shareholders approving at the SGM the issuance of the Subscription Shares pursuant to the Share Subscription Agreement and the transactions contemplated thereunder, including the appointment of directors recommended by the Share Subscriber (in the case of any such appointment, the effective date would be on the Share Subscription Completion Date), the Share Subscription and the Whitewash Waiver;
(c) the Executive granting the Whitewash Waiver to the Share Subscriber, and the Whitewash Waiver remaining valid;
(d) the Listing Committee granting approval for the listing of, and dealing in, the Subscription Shares;
(e) the Company is not, as a result of the Share Subscription or any other transactions contemplated under the Share Subscription Agreement, being deemed by the Stock Exchange as a reverse takeover transaction, and/or the Company is not being required by the Stock Exchange to suspend trading until fulfilment of the requirements of a new listing application under the Listing Rules;
(f) all warranties in the Share Subscription Agreement being true, accurate and not misleading as at the date of the Share Subscription Agreement and the Share Subscription Completion Date and the Company does not breach any of its undertakings in the Share Subscription Agreement;
(g) from the date of the Share Subscription Agreement until the Share Subscription Completion Date, the Company and other members of the Group complying with the pre-completion undertakings set out in the Share Subscription Agreement;
(h) from the date of the Share Subscription Agreement until the Share Subscription Completion Date, the Shares continuing to be listed and traded on the Stock Exchange (except for suspension of trading in connection with the Share Subscription Agreement and the CB Subscription Agreement or suspension of trading for not more than five trading days) and no requests having been received from the SFC and/or the Stock Exchange that the listing status of the Shares on the Stock Exchange will be revoked or cancelled as a result of the completion under the Share Subscription Agreement or any terms thereunder or other matters;
(i) the minimum public float requirements under the Listing Rules not being breached by the Company as result of the Share Subscription;

(j) from the date of the Share Subscription Agreement until the Share Subscription Completion Date, no person (except a party to the Share Subscription Agreement) having obtained a binding order from any relevant authorities restricting or prohibiting any party to the Share Subscription Agreement to complete the transactions contemplated thereunder at any relevant authorities and the Share Subscription Agreement and the transactions contemplated thereunder comply with applicable laws and regulations;
(k) all relevant government authorities or regulatory authorities having granted to the Company or the Share Subscriber (or its nominee(s)) all necessary consents, approvals, reports and filings (if applicable) in respect of the entry into and performance of the Share Subscription Agreement;
(l) the Board having passed a resolution on or before 30 June 2015 to change the Company’s financial year end date from 31 March to 31 December commencing from the financial year of 2015;
(m) since the date of the Share Subscription Agreement, (i) there having been no events, conditions, occurrence or development of a state of circumstances or facts which has had or reasonably could be expected to have a material and adverse change or effect on the business, operations, assets or liabilities, financial conditions or prospects of the Group or any of its subsidiaries (as applicable) and; (ii) there having been no change in the applicable laws in each of the jurisdictions in which the Group has business operations which may lead to material and adverse effect to the Group as a whole;
(n) the Share Subscriber having received a legal opinion issued by Bermuda counsel on matters of Bermuda law in a form reasonably satisfactory to the Share Subscriber; and
(o) there are proposals or arrangements in place whereby the Stock Exchange will not regard the Company as a cash company under Rule 14.82 of the Listing Rules.

The Share Subscriber may at its discretion waive compliance of any or all of the above conditions, except the condition stated in paragraphs (a), (b), (c), (d), (k) and (o) above and except where such conditions are mandatory pursuant to the laws and regulations applicable to the Company, the Listing Rules and the Takeovers Code.

If the above conditions have not been fully fulfilled, satisfied or waived on or before the Share Subscription Long Stop Date (or such other date as may be agreed between the parties to the Share Subscription Agreement), the Share Subscription Agreement shall be of no further effect and the parties thereto shall forthwith be released from performing or further performing their obligations under the Share Subscription Agreement, save in respect of any antecedent breach or any accrued right or remedies, which shall not be prejudiced or affected.

If all the conditions have been fulfilled, satisfied or, if applicable, waived on or before the Share Subscription Long Stop Date (or such other date as may be agreed between the parties to the Share Subscription Agreement), completion under the Share Subscription Agreement shall take place on the Share Subscription Completion Date. On such date the Company will issue the Subscription Shares upon the payment of the total subscription consideration under the Share Subscription Agreement, and the Company understands from the Share Subscriber that it and/or its nominated wholly-owned subsidiaries will take up the Subscription Shares.

Information of the Share Subscriber

The Share Subscriber is the real estate arm of China Minsheng Investment and its investment scope includes high quality real properties in first-tier cities, investment and operation of multipliable assets, development of industrial parks, infrastructure and city construction, theme industry such as aged care and tourist industry, and other high criterion and high profitability investment opportunities. 90% of the total share capital of the Share Subscriber is held by China Minsheng Investment and the remaining 10% is held by China Industrial International Trust Limited (“ CIIT ”). As disclosed on CIIT’s official website, CIIT is controlled by Industrial Bank Co., Ltd. (“ CIB ”), a commercial bank incorporated in the PRC and listed on the Shanghai Stock Exchange. Based on the latest quarterly report issued by CIB on 29 October 2014, a substantial shareholder of CIB as of 30 September 2014 is the Finance Department of China Fujian Provincial Government, which holds 17.86% of the total issued share capital of CIB. None of CIIT, CIB or the Finance Department of China Fujian Provincial Government is acting in concert with the Share Subscriber in respect of the Share Subscription.

China Minsheng Investment is a large private investment company organized by The All-China Federation of Industry and Commerce in China and was launched by 59 well-known private enterprises throughout China. The shareholders of China Minsheng Investment are all large scale private enterprises, some of which are among China’s top 500 companies. The business scope of the shareholders of China Minsheng Investment involves a variety of industries such as machinery manufacturing, metallurgy, information technology, asset management, garment, biological pharmacy, environmental protection, new energy, culture and media, commerce and trade, electric power, home appliances stores, e-commerce, real estate and so forth. As at the date of this announcement, no single shareholder of China Minsheng Investment holds more than 4% of the voting rights or equity contributed in China Minsheng Investment. None of the shareholders of China Minsheng Investment is acting in concert with the Share Subscriber in respect of the Share Subscription (save for those shareholders whose ultimate beneficial owners are also directors of the Share Subscriber or directors of China Minsheng Investment). To the knowledge of the Share Subscriber, none of the shareholders of China Minsheng Investment is acting in concert with each other in respect of their investment in China Minsheng Investment.

China Minsheng Investment was established and registered in Shanghai in May 2014, with a registered capital of RMB50 billion. It is a congolmerate with a wide variety of businesses including equity investment, equity investment management, business consulting, financial consulting, industrial investment, asset management, and investment consulting. China Minsheng Investment’s strategy is to fully utilise its competitive strengths in terms of national brand, integration of resources, financial strength, comprehensive operations, management output and other competitive advantages in the implementation of its strategic integration in key target industries, with the objectives to create a strategic and sustainable business model. China Minsheng Investment will, through capital investment and leverage, and featured by business consolidation and the full range of financial licenses, apply its resources and efforts in developing distinctive business portfolios and key segments. In terms of the specific implementation path, China Minsheng Investment, relying on industrial integration, industrial strategic investment, mixed investment, establishment of full financial licenses platform and exploration of overseas investment market, will actively carry out the relevant business activities.

The directors of the Share Subscriber, the directors and the president of China Minsheng Investment as well as those shareholders of China Minsheng Investment whose ultimate beneficial owners are directors of the Share Subscriber or directors of China Minsheng Investment are considered to be parties acting in concert with the Share Subscriber in respect of the Share Subscription.

Dealings and interest held in the Company’s securities by the Share Subscriber and its concert parties

HSBC, being the financial adviser of the Share Subscriber, together with its affiliates (other than those members having exempt principal trader or exempt fund manager status), (collectively, the “ HSBC Group ”) are presumed to be acting in concert with the Share Subscriber. As at the date of this announcement, HSBC does not hold any Shares. Details of holdings or borrowings or lendings of Shares (or options, rights over Shares, warrants or derivatives in respect of them) held by or entered into by other parts of the HSBC Group will be obtained as soon as possible after this announcement has been made in accordance with Note 1 to Rule 3.5 of the Takeovers Code. Therefore, the statements in this announcement as to holdings or borrowings or lendings of, or voting of Shares (or options, rights over Shares, warrants or derivatives in respect of them) by parties presumed to be acting in concert under the Takeovers Code with the Share Subscriber are subject to the holdings, borrowings or lendings (if any) of the other parts of the HSBC Group.

As at the date of this announcement, the Share Subscriber and parties acting in concert with it are Independent Third Parties, and the Share Subscriber and parties acting in concert with it do not hold, control or direct any voting rights and rights over shares, convertible securities, warrants, options in the Company or outstanding derivatives in respect of the securities of the Company (other than those pursuant to the Share Subscription Agreement). The Share Subscriber is also independent of the CB Subscriber.

As at the date of this announcement, the Share Subscriber and parties acting in concert with it have not borrowed or lent any Shares.

Whitewash Waiver

Upon completion of the Share Subscription, the Share Subscriber and parties acting in concert with it will hold approximately 6,500,000,000 Shares, representing approximately 63.67% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares. The Share Subscriber and parties acting in concert with it will incur an obligation pursuant to Rule 26 of the Takeovers Code to make a mandatory general offer to the Shareholders to acquire all the Shares other than those owned or agreed to be acquired by the Share Subscriber, its ultimate beneficial owners and parties acting in concert with any of them.

The Company understands from the Share Subscriber that, other than the Share Subscription Agreement, there are no (a) arrangements (whether by way of option, indemnity or otherwise) in relation to the shares of the Share Subscriber or the Shares which might be material to the Share Subscription Agreement and/or the Whitewash Waiver; (b) agreements or arrangements to which the Share Subscriber is a party which relate to the circumstances in which it may or may not invoke or seek to invoke a pre-condition or a condition to the Share Subscription Agreement and/or the Whitewash Waiver.

As at the date of this announcement, none of the Share Subscriber nor any party acting in concert with it has received an irrevocable commitment from any Shareholder to vote for or against the resolutions concerning the Share Subscription and/or the Whitewash Waiver to be proposed at the SGM.

If the Whitewash Waiver is approved by the Independent Shareholders and the Share Subscription proceeds to completion, the shareholding of the Share Subscriber and parties acting in concert with it in the Company will exceed 50% upon the allotment and issue of the Subscription Shares. The Share Subscriber and parties acting in concert with it may further increase their shareholdings in the Company without incurring any further obligations under Rule 26 of the Takeovers Code to make a general offer.

If completion of the Share Subscription takes place, in view of the significant amount of cash proceeds to be received by the Company, unless there are arrangements in place whereby the Company utilises a majority of its existing cash resources prior to such completion, the Company may be regarded as a cash company under Rule 14.82 of the Listing Rules. Accordingly, one of the conditions precedent to the completion of the Share Subscription would not have been satisfied and therefore the Share Subscription will not proceed to completion.

The view and recommendation of the independent financial adviser in respect of the Share Subscription and the terms thereof and the Whitewash Waiver will be set out in a circular to be issued by the Company to Shareholders as required by the Takeovers Code and the Listing Rules.

PROPOSED ISSUE OF CONVERTIBLE BONDS

Principal terms of the CB Subscription Agreement

Date: 9 February 2015

Parties: (i) the Company; and

(ii) the CB Subscriber.

The CB Subscription

Subject to fulfilment of the conditions of the CB Subscription Agreement, the CB Subscriber shall subscribe or procure the subscription by his nominee(s) for the Convertible Bonds in the principal amount of HK$200,000,000 at their face value and shall pay or procure that there shall be paid to or to the order of the Company the subscription consideration under the CB Subscription Agreement in the amount of HK$200,000,000.

Conditions for the CB Subscription

The CB Subscription is conditional upon:

(a) Shareholders approving at the SGM the Increase in Authorised Share Capital;
(b) the Company having obtained the Shareholders’ approval of the transactions contemplated under the CB Subscription Agreement including the issue of the Conversion Shares;
(c) the Listing Committee granting approval for the listing of, and dealing in, the Conversion Shares and such approval remaining valid and effective on the CB Subscription Completion Date;
(d) the Company’s representations and warranties contained in the CB Subscription Agreement remaining true, accurate and not misleading in each case in accordance with their terms; and
(e) the CB Subscriber’s representations and warranties contained in the CB Subscription Agreement remaining true, accurate and not misleading in each case in accordance with their terms.

The CB Subscription Agreement and the Share Subscription Agreement are not interconditional.

In the event that the conditions of the CB Subscription Agreement are not fulfilled or (in respect of conditions (d) and (e)) waived on or before the CB Subscription Long Stop Date (or such other date as may be agreed between the parties to the CB Subscription Agreement), the CB Subscription shall be of no further effect and the parties thereto shall be released from all obligations under the CB Subscription Agreement, save for any liability arising out of any antecedent breaches of the CB Subscription Agreement.

Completion of the CB Subscription

If all the conditions have been fulfilled and/or waived (if applicable) on or before the CB Subscription Long Stop Date, completion under the CB Subscription Agreement shall take place on the CB Subscription Completion Date, and on which date the Company will issue the Convertible Bonds to the CB Subscriber upon the payment of the total principal amount of the Convertible Bonds.

Information of the CB Subscriber

The CB Subscriber, namely, Honghu Capital Company Limited, is a company incorporated under the laws of the British Virgin Islands and an investment holding company wholly and beneficially owned by Mr. Deng Jun Jie. Mr. Deng Jun Jie is a businessman and a Hong Kong permanent resident. Mr. Deng Jun Jie is an Independent Third Party and does not have any relationship with the Share Subscriber, China Minsheng Investment and the 59 shareholders of China Minsheng Investment.

Principal terms of the Convertible Bonds

Issuer:	the Company
CB Subscriber:	Honghu Capital Company Limited
Principal amount:	HK$200,000,000
Maturity Date:	The third anniversary of the date of issue of the
	Convertible Bonds.
Zero Coupon:	The Convertible Bonds do not carry any interest.
Security:	The Convertible Bonds will be unsecured.
Conversion Price:	HK$0.20 per Conversion Share.
	The Conversion Price will be subject to customary
	adjustments for consolidations, subdivisions or
	reclassification of Shares which may have a dilution
	effect on the Conversion Shares to be allotted and
	issued to the holders of the Convertible Bonds upon
	the exercise of the conversion right attached to the
	Convertible Bonds.

Conversion Shares:

At the initial Conversion Price, up to 1,000,000,000 Conversion Shares (subject to adjustment) will be allotted and issued pursuant to the Specific Mandate to be sought at the SGM assuming the conversion rights attaching to the Convertible Bonds are exercised in full.

The Conversion Shares, when allotted and issued, will rank pari passu in all respects with all Shares in issue at the date of allotment and issue of such Conversion Shares.

Conversion Period:

Transferability:

Lock-up:

The period from the date which is 6 months from the date of issue of the Convertible Bonds and up to ten business days prior to the Maturity Date.

The Convertible Bonds may be assigned or transferred in whole or in part (in whole multiples of HK$10,000,000) of its outstanding principal amount and the Company shall facilitate any such assignment or transfer of the Convertible Bonds.

During the period of 24 months immediately following the issue date of the Convertible Bonds, unless with the prior written consent of the Company:

(a) no transfer of the Convertible Bonds shall be effected and the Company shall not be obliged to effect any transfer of the Convertible Bonds during such lock-up period;
(b) no bondholder shall, during such lock-up period, (i) contract to sell, grant or agreeing to grant any option, right or warrant to purchase or subscribe for, or otherwise howsoever transfer or dispose of, either directly or indirectly, conditionally or unconditionally, any legal or beneficial interest in the Convertible Bonds or any securities convertible into or exercisable or exchangeable for, or that represent the right to receive, the Convertible Bonds or any interest (except for interest in the form of charge or mortgage) in them; or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any beneficial ownership

of the Convertible Bonds or any interest in them or any of the economic consequences or incidents of ownership of the Convertible Bonds or any interest in them; or (iii) enter into any transactions directly or indirectly with the same economic effect as any transactions described in (i) or (ii) above; or (iv) contract or agree to, or publicly disclose that it will or may enter into any transaction described in (i), (ii) or (iii) above whether any such transaction described in (i), (ii) or (iii) above is to be settled by delivery of the Convertible Bonds or other securities, in cash or otherwise;

(c) no bondholder shall, during such lock-up period, designate a person or person(s) other than such bondholder in the conversion notice or otherwise in writing to become the holder of record of all or any of the Conversion Shares issuable upon the conversion of the Convertible Bonds; and
(d) no bondholder shall, during such lock-up period, (i) contract to sell, grant or agreeing to grant any option, right or warrant to purchase or subscribe for, or otherwise howsoever transfer or dispose of, either directly or indirectly, conditionally or unconditionally, any legal or beneficial interest in the Conversion Shares or any securities convertible into or exercisable or exchangeable for, or that represent the right to receive, the Conversion Shares or any interest (except for interest in the form of charge or mortgage) in them; or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any beneficial ownership of the Conversion Shares or any interest in them or any of the economic consequences or incidents of ownership of the Conversion Shares or any interest in them; or (iii) enter into any transactions directly or indirectly with the same economic effect as any transactions described in (i) or (ii) above; or (iv) contract or agree to, or publicly disclose that it will or may enter into any transaction described in (i), (ii) or (iii) above

whether any such transaction described in (i), (ii) or (iii) above is to be settled by delivery of the Conversion Shares or other securities, in cash or otherwise,

except for transfer to an entity which is controlling, controlled by or under the common control of such bondholder(s).

Redemption:

Any amount of the Convertible Bonds which remains outstanding on the Maturity Date shall be redeemed at its then outstanding principal amount.

Conversion Price

The initial Conversion Price of HK$0.20 per Conversion Share represents:

(a) a discount of approximately 42.86% to the closing price of HK$0.35 per Share on the Stock Exchange on the Last Trading Day of the Shares;
(b) a discount of approximately 35.06% to the average closing price of approximately HK$0.308 per Share for the last 5 trading days up to and including the Last Trading Day;
(c) a discount of approximately 23.37% to the average closing price of approximately HK$0.261 per Share for the last 30 trading days up to and including the Last Trading Day; and
(d) a discount of approximately 19.35% to the average closing price of approximately HK$0.248 per Share for the last 60 trading days up to and including the Last Trading Day.

In addition, by reference to the net liability position of the Company as of 30 September 2014 of approximately HK$7.88 million (equivalent to a negative amount of approximately HK$0.022 per Share based on 364,955,880 Shares then in issue), the Conversion Price represents a substantial premium over this amount. In October 2014, the Company has completed an equity fund raising exercise by way of rights issue and raised net proceeds of approximately HK$283 million. Based on the net liability of the Company as at 30 September 2014, and taking into account the net proceeds from the aforementioned rights issue and based on the 3,709,602,920 Shares in issue as at the date of this announcement, the adjusted estimated net asset value of the Company is approximately HK$0.074 per Share. The Conversion Price therefore represents a premium of over 170% to the adjusted estimated net asset value per Share of the Company.

The net Conversion Price, after deducting all relevant costs and expenses is estimated to be approximately HK$0.199 per Conversion Share.

The Conversion Price was arrived at after arm’s length negotiations between the Company and the CB Subscriber with reference to, amongst others, the recent share price performance, liquidity of the Shares and the zero coupon rate of the Convertible Bonds. The Directors consider that the initial Conversion Price and the terms of the CB Subscription Agreement are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

The Conversion Shares

Assuming full conversion of the Convertible Bonds, 1,000,000,000 Conversion Shares will be allotted and issued to the bondholder(s). The 1,000,000,000 Conversion Shares to be allotted and issued represent: (i) approximately 26.96% of the existing issued share capital of the Company as at the date of this announcement; (ii) approximately 21.23% of the issued share capital of the Company as enlarged by the allotment and issue of the 1,000,000,000 Conversion Shares; and (iii) approximately 8.92% of the issued share capital of the Company as enlarged by the allotment and issue of the 6,500,000,000 Subscription Shares and the 1,000,000,000 Conversion Shares.

REASONS FOR THE SHARE SUBSCRIPTION AND THE CB SUBSCRIPTION AND INTENDED USE OF PROCEEDS

The principal business of the Company is investment holding and the Group’s business operations were principally related to property development and investment.

As stated in the Company’s interim report for the six months ended 30 September 2014, it is the Group’s ongoing plan to continue to leverage its resources in exploring opportunities in the property development and investment business. However, should there be any other potential investments in other areas that could potentially enhance the financial and operating performance of the Group and are in the interests of the Company and the Shareholders as a whole, they will also be considered.

The Directors have continued to review its existing businesses and strive to improve the business operations and financial position of the Company by proactively seeking potential investment opportunities that could diversify and expand its existing business portfolio, establish new business where desirable, broaden its source of income, and enhance value to its Shareholders. In an effort to further implement this strategy, the Directors believe that it would create business synergies if the Company were to introduce a prominent and reputable strategic investor who would be able to work with the Company to source opportunities for new business development as well as business diversification and extension along the supply chain of property development and investment.

The Directors have considered that:

(a) the background, industry expertise and experience of the Share Subscriber and China Minsheng Investment, as well as the variety of its business portfolios which include a specific segment engaging in property related industries;
(b) the benefits including strategic value and management expertise the Share Subscriber could bring to the Group in the future; and
(c) consistent with the strategic intention of the Group, the Share Subscriber’s intention to make investments in the extended PRC property sector including businesses that are upstream and downstream from property development and investment, as well as businesses that are ancillary to property development and investment.

The Directors are of the view that the Company will be able to capture and pursue better business and investment opportunities upon completion of the Share Subscription. In addition to introducing a strategic investor, the Directors consider that it would be a desirable opportunity to seek financial investor to provide additional funding to support the implementation of the Group’s business strategy. Accordingly, the Directors consider that the Share Subscription and the CB Subscription will provide immediate funding, benefit the long-term development of the Company by broadening its equity base and also strengthen the financial position of the Company.

The Directors believe that, with the valuable contributions and views from the Share Subscriber, the Group will be in a better position to assess and evaluate the commercial viability of the business opportunities that are currently under review, to source and identify new business development and diversification opportunities, and to capture and undertake those opportunities.

The Company has considered other fund raising methods such as rights issue or open offer, and debt financing and considered that the Share Subscription and the CB Subscription are preferable for the following reasons:

(i) substantial amount of capital requirement is required for the property development business and given the Company’s current market capitalisation, it would be difficult for financial institutions to provide facility up to such substantial amount to the Group in view of the tightened lending policies of the banks and financial institutions in the PRC on loans to property development companies, and debt financing would inevitably increase the financial costs of the Group; and
(ii) a pre-emptive issue such as rights issue or open offer would not be able to bring in strategic investors as Shareholders, particularly investors with experience and background in the property development sector in the PRC, such as the Share Subscriber.

Accordingly, the Directors consider that despite the dilution effect, it is fair and reasonable to proceed with the Share Subscription and the CB Subscription.

In addition to the above, although the Subscription Price and the Conversion Price represent a relatively substantial discount to the closing price of Shares on the Last Trading Day, in view of the foregoing and having further taking into account the reasons and benefits of the Share Subscription and the CB Subscription that may be brought to the Group, the Directors consider that the Subscription Price (other than the nonexecutive Directors who have no direct or indirect interest in the Share Subscription, who will be advised by the independent financial adviser) and the Conversion Price are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

The gross aggregate proceeds of the Share Subscription and the CB Subscription are HK$1,500 million. The net aggregate proceeds of the Share Subscription and the CB Subscription is approximately HK$1,296 million and approximately HK$199 million respectively. The Company intends to apply the net proceeds to be raised from the Share Subscription and the CB Subscription (a total of approximately HK$1,495 million) as follows:

(a) up to approximately HK$600 million for pursuing the potential acquisition referred to in the framework agreement entered into by the Company in December 2014 for the proposed acquisition of Jinhong Property Development Limited (please refer to the announcement dated 24 December 2014 for details). The usage of such proceeds would depend on whether such potential acquisition could proceed to the signing of the formal sale and purchase agreement and subsequently proceed to completion, and whether the Company will acquire a majority or minority stake in the relevant target company and the size of such stake. It would also be subject to the satisfactory findings of the due diligence investigation. It should be noted that as such potential acquisition requires the Company to provide funds proof, completion of the Share Subscription and the CB Subscription will place the Company in a position to continue the negotiations and process for such potential acquisition;
(b) approximately HK$800 million for making investment in or acquiring new business opportunities in the upstream PRC property development sector in Central, Eastern and Southern China. In this connection, the Company intends to prioritise the markets in the upstream property development sector (namely, the building of the capability of the Group in the production of pre-cast units and materials) in Guangdong Province, Shanghai Municipal City, Jiangsu Province and Zhejiang Province. It is contemplated that such HK$800 million will be utilised in stages from the completion of the Share Subscription and the CB Subscription until around the third to fourth quarter of 2016 for making investments in the acquisition of land or existing production facilities, the building and/or configuration of production facilities, as well as the purchase of equipment and machineries for installation in the production facilities to enable the Group to establish its capability in the production of pre-cast units and materials. In particular, (i) in

relation to Guangdong Province, the Company is considering acquiring a piece of project land with a production facility which has an area of approximately 100 mu. If this opportunity materialises, investments will be made by the Group to reconfigure the production facility as well as the purchase of new equipment; (ii) in relation to Zhejiang Province, the Company is considering investing in a project by way of a joint venture and which project consists of, among others, existing land with an area of approximately 100 mu; and (iii) in relation to Shanghai Municipal City, the Company is currently targeting industrial land projects which has a land coverage of approximately 100 mu to 200 mu with existing production facilities. Whilst no formal arrangement or binding agreement has been entered into by the Group in respect of any of the above potential opportunities, the Company’s intention is to continue with the review and studies of these opportunities and other appropriate opportunities. Depending on the circumstances and results of these studies and negotiations, the above specific locations and projects may however be subject to changes; and

(c) the remaining amount of approximately HK$95 million as general working capital of the Group, including the recruitment of personnel to expand the managerial and operational headcounts of the Group.

In respect of the future development of the Group as mentioned above, further information will be provided in the circular to be despatched to Shareholders in accordance with the Listing Rules in relation to the Share Subscription and the CB Subscription.

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

As at the date of this announcement, the authorised share capital of the Company is HK$400,000,000 divided into 4,000,000,000 Shares of HK$0.10 each, of which 3,709,602,920 Shares have been allotted and issued as fully paid or credited as fully paid. Under the Share Subscription and assuming full conversion of the Convertible Bonds and no adjustment will be required to be made to the Conversion Price, the Company will be required to issue an aggregate of 7,500,000,000 Shares. In order to undertake the Share Subscription and issue of Conversion Shares (assuming full conversion of the Convertible Bonds), the Board proposes to increase the authorised share capital of the Company from HK$400,000,000 divided into 4,000,000,000 Shares to HK$2,500,000,000 divided into 25,000,000,000 Shares by creating 21,000,000,000 new Shares.

The Increase in Authorised Share Capital is conditional upon the passing of an ordinary resolution by the Shareholders at the SGM. Shareholders who are interested in the Share Subscription or the CB Subscription will be required to abstain from voting on such resolution.

SPECIFIC MANDATES TO ISSUE THE SUBSCRIPTION SHARES AND THE CONVERSION SHARES

The Company will seek a specific mandate from the Independent Shareholders at the SGM for the allotment and issue of the Subscription Shares and a specific mandate from the Shareholders at the SGM for the allotment and issue of the Conversion Shares upon the full conversion of the Convertible Bonds.

APPLICATION FOR LISTING

Application will be made by the Company to the Listing Committee for the listing of, and permission to deal in, the Subscription Shares and the Conversion Shares.

FUND RAISING ACTIVITIES DURING THE PAST TWELVE MONTHS

Save as disclosed below, the Company has not conducted any other equity fund raising exercises in the past twelve months before the date of this announcement.

Date of Net proceeds Intended use of proceeds announcement Event (approximately) at that time Actual use of proceeds 11 August 2014 Rights issue of HK$283 million Future development of the a. HK$72 million has been 2,919,647,040 Group, including but not used for payment of new Shares of the limited to for the payment the earnest money in Company at the of the cash portion of relation to the proposed subscription price the consideration of the acquisition of properties of HK$0.10 each proposed acquisition of in Shenzhen (Note) ; properties in Shenzhen, b. HK$28 million has been while the remaining used for payment of proceeds (if not utilized) the earnest money in will be applied for other relation to the proposed investment opportunities identified and/or the acquisition of the entire equity interest business development of of Jinhong Property the Group and/or general Development Limited, working capital of the further information Group. of which is set out in the announcement of the Company dated 24 December 2014;

c. approximately HK$8 million has been used for working capital of the Group; and
d. the remaining of approximately HK$175 million is yet to be utilized and has been placed in interest-bearing bank account for use in due course.

Note: As disclosed in the announcement of the Company dated 2 March 2015, the framework agreement in relation to the proposed acquisition of properties in Shenzhen has been lapsed. The HK$72 million earnest money paid will be refunded to the Company pursuant to the framework agreement.

CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY

As at the date of this announcement, the Company has 3,709,602,920 Shares in issue and does not have any other outstanding convertible securities, options warrants or other derivatives in issue which are convertible or exchangeable into Shares. The shareholding structure of the Company (a) as at the date of this announcement; (b) after the completion of the Share Subscription; and (c) after the completion of the Share Subscription and the CB Subscription (assuming that all of the Convertible Bonds are converted in full and there are no other changes to the issued share capital of the Company) are as follows:

Shareholders of the Company Taiping Quantum Strategic Fund_Note 1_ Taiping Quantum Prosperity Fund_Note 1_ Taiping Quantum China Opportunities Fund_Note 1_ The Share Subscriber and its concert parties The CB Subscriber Existing public Shareholders Total	As at the date of this announcement Shares % (approx.) 340,000,000 9.17 319,420,000 8.61 7,420,000 0.20 – – – – 3,042,762,920 82.02 3,709,602,920 100.00	Immediately after the issue of the Subscription SharesNote 2 Shares % (approx.) 340,000,000 3.33 319,420,000 3.13 7,420,000 0.07 6,500,000,000 63.67 – – 3,042,762,920 29.80 10,209,602,920 100.00	Immediately after the issue of the Subscription Shares and the Conversion SharesNote 3 Shares % (approx.) 340,000,000 3.03 319,420,000 2.85 7,420,000 0.07 6,500,000,000 57.99 1,000,000,000 8.92 3,042,762,920 27.14 11,209,602,920 100.00	Immediately after the issue of the Subscription Shares and the Conversion SharesNote 3 Shares % (approx.) 340,000,000 3.03 319,420,000 2.85 7,420,000 0.07 6,500,000,000 57.99 1,000,000,000 8.92 3,042,762,920 27.14 11,209,602,920 100.00
				100.00

Note 1: Each of Taiping Quantum Strategic Fund, Taiping Quantum Prosperity Fund and Taiping Quantum China Opportunities Fund is managed by Quantum China Asset Management Limited. Mr. Yeung, an executive Director, is the managing partner and chief executive officer of Quantum China Asset Management Limited.
Note 2: Assuming that the Increase in Authorised Share Capital will be approved by the Shareholders at the SGM and assuming that the CB Subscriber does not purchase any Share from the date of this announcement up to the Share Subscription Completion Date.
Note 3: Assuming that the Increase in Authorised Share Capital will be approved by the Shareholders at the SGM and assuming that the CB Subscriber does not purchase any Share from the date of this announcement up to the issue of the Conversion Shares and assuming that the Share Subscriber and its concert parties do not acquire any Share after completion of the Share Subscription and up to the issue of the Conversion Shares.

SGM

The SGM will be held to consider, and if thought fit, pass the ordinary resolutions to approve, among other things, (i) the Increase in Authorised Share Capital; (ii) the Share Subscription Agreement and the transactions contemplated thereunder; (iii) the CB Subscription Agreement and the transactions contemplated thereunder; (iv) the granting of the Specific Mandates for the allotment and issue of the Subscription Shares and the Conversion Shares; and (v) the Whitewash Waiver. As at the date of this announcement, the Share Subscriber and parties acting in concert with any of them do not hold any Shares or other securities in the Company and accordingly are not entitled to vote on any of the resolutions to be proposed at the SGM. The CB Subscriber and its ultimate beneficial owner do not hold any Shares or other securities in the Company and accordingly are not entitled to vote on any of the resolutions to be proposed at the SGM. Only Shareholders who do not have a material interest or who are not involved in or interested in the Increase in Authorised Share Capital, the Share Subscription, the CB Subscription or the Whitewash Waiver can vote on the aforesaid resolutions at the SGM.

GENERAL

RESUMPTION OF TRADING

DEFINITIONS

In this announcement, the following expressions have the meanings set out below unless the context requires otherwise.

“Board” the board of Directors “Bond Instrument” the instrument to be executed by the Company constituting the Convertible Bonds, together with the schedules (as from time to time altered in accordance with the instrument) and any other document executed in accordance with the instrument (as from time to time so altered) and expressed to be supplemental to the instrument
“CB Subscriber” Honghu Capital Company Limited, a company incorporated in the British Virgin Islands with limited liability and is wholly and beneficially owned by Mr. Deng Jun Jie who is an Independent Third Party
“CB Subscription” the subscription of the Convertible Bonds pursuant to the terms of the CB Subscription Agreement and the Bond Instrument
“CB Subscription Agreement” the subscription agreement dated 9 February 2015 and entered into between the Company and the CB Subscriber in connection with the CB Subscription

“CB Subscription Completion Date”
the day on which the completion of CB Subscription takes place, which shall be the fifth business day after the date on which the last of the conditions precedent to the CB Subscription Agreement is fulfilled or such other date as the parties may agree in writing
“CB Subscription
31 August 2015
Long Stop Date”
“China Minsheng Investment”
China Minsheng Investment Corp., Ltd.*, which holds 90% of the total share capital of the Share Subscriber
“Company”
South East Group Limited, a company incorporated in Bermuda and the Shares of which are listed on the main board of the Stock Exchange
“Conversion Price”
the initial conversion price of HK$0.20 per Conversion Share (subject to adjustments as set out in the Bond Instrument)
“Conversion Shares” up to 1,000,000,000 new Shares falling to be allotted and issued upon exercise of the conversion rights attached to all of the Convertible Bonds at the Conversion Price
“Convertible Bonds”
the unsecured zero-coupon convertible bonds in the principal amount of HK$200,000,000 to be created by the Bond Instrument and for the time being outstanding or, as the context may require, any part of the principal amount
“Director(s)” director(s) of the Company
“Executive”
the Executive Director of the Corporate Finance Division of the SFC or any delegate of such Executive Director
“Group”
the Company and its subsidiaries
“HK$” or “HK dollars”
Hong Kong Dollars, the lawful currency of Hong Kong
“Hong Kong”
the Hong Kong Special Administrative Region of the PRC

“HSBC”

The Hongkong and Shanghai Banking Corporation Limited, an institution registered under the SFO to conduct type 1 (dealing in securities), type 2 (dealing in futures contracts), type 4 (advising on securities), type 5 (advising on futures contracts), type 6 (advising on corporate finance) and type 9 (asset management) regulated activities as defined under the SFO and a licensed bank under the Banking Ordinance (Chapter 155 of the Laws of Hong Kong), the financial adviser to the Share Subscriber in relation to the Share Subscription
“Increase in Authorised Share Capital”
the proposed increase in the authorised share capital of the Company from HK$400,000,000 divided into 4,000,000,000 Shares to HK$2,500,000,000 divided into 25,000,000,000 Shares by the creation of additional 21,000,000,000 Shares
“Independent Board Committee”
the independent board committee comprising of Mr. Lee Chi Ming, Mr. Chan Chi Hung, Anthony and Mr. Jiang Hongqing, all being the independent nonexecutive Directors, formed to consider the terms of the Share Subscription Agreement and the transactions contemplated under the Share Subscription Agreement and the Whitewash Waiver
“Independent Shareholders”
Shareholders other than those who have a material interest or who are involved in or interested in the Share Subscription and the Whitewash Waiver (including Taiping Quantum Strategic Fund, Taiping Quantum Prosperity Fund and Taiping Quantum China Opportunities Fund)
“Independent Third Party(ies)” third party(ies) independent of the Company and its connected persons as defined under the Listing Rules
“Last Trading Day”
6 February 2015, being the last trading day immediately prior to the date of the Share Subscription Agreement and the date of the CB Subscription Agreement
“Listing Committee”
the listing committee of the Stock Exchange for considering applications for listing and the granting of listing approval

“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Maturity Date” the third anniversary of the date of issue of the Convertible Bonds
“Mr. Yeung” Mr. Yeung Chun Wai, Anthony, the chairman of the Company and an executive Director
“PRC” the People’s Republic of China, which for the purpose of this announcement, shall exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan
“PRC Authorities” all governmental or trade agencies, courts or other regulatory bodies of the PRC whose relevant licences, authorisations, registrations or approvals are required for effecting any transaction contemplated by the Share Subscription Agreement and other related transaction documents
“RMB” Renminbi, the lawful currency of the PRC
“SFC” the Securities and Futures Commission of Hong Kong “SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
“SGM” the special general meeting of the Company to be convened to approve, among other things, (i) the Increase in Authorised Share Capital; (ii) the Share Subscription Agreement; (iii) the CB Subscription Agreement; (iv) the granting of the Specific Mandates; and (v) the Whitewash Waiver
“Share(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company
“Shareholder(s)” person(s) registered in the books of the Company as the holder(s) of Share(s) for the time being
“Share Subscriber” China Minsheng Jiaye Investment Co., Ltd.*, a company established in the PRC

“Share Subscription”
the subscription for the Subscription Shares by the Share Subscriber (or its nominee(s)) pursuant to the terms of the Share Subscription Agreement
“Share Subscription Agreement”
the subscription agreement dated 9 February 2015 entered into between the Company and the Share Subscriber in connection with the Share Subscription (as supplemented by a supplemental agreement dated 7 March 2015)
“Share Subscription Completion Date”
the day on which the completion of Share Subscription takes place, which shall be the fifth business day after the date on which the conditions precedent to the Share Subscription Agreement are fulfilled and/or waived (if applicable) or such other date as the parties may agree in writing
“Share Subscription Long Stop Date”
31 August 2015
“Specific Mandate(s)”
a specific mandate to be granted to the Directors in relation to the proposed allotment and issue of the Subscription Shares to be approved by the Independent Shareholders at the SGM and a specific mandate to be granted to the Directors in relation to the proposed allotment and issue of the Conversion Shares upon the full conversion of the Convertible Bonds to be approved by the Shareholders at the SGM (as the case may be)
“Stock Exchange”
The Stock Exchange of Hong Kong Limited
“Subscription Shares”
6,500,000,000, being the number of Shares equals to HK$1,300,000,000 (being the total subscription consideration under the Share Subscription Agreement) divided by the Subscription Price
“Subscription Price” the subscription price of HK$0.20 per Subscription Share under the Share Subscription Agreement
“Takeovers Code”
the Code on Takeovers and Mergers issued by the SFC
“Whitewash Waiver”
a waiver from the obligation of the Share Subscriber and parties acting in concert with it to make a mandatory general offer for all the Shares not already owned or agreed to be acquired by them under Rule 26 of the Takeovers Code as a result of the Share Subscription

“%”

per cent.

By order of the Board of South East Group Limited Yeung Chun Wai, Anthony Chairman and Executive Director

Hong Kong, 9 March 2015

As at the date of this announcement, the Board comprises six Directors, namely Mr. Yeung Chun Wai, Anthony (Chairman), Mr. Chen Domingo (Deputy Chairman) and Mr. Chan Chi Yuen as executive Directors; Mr. Lee Chi Ming, Mr. Chan Chi Hung, Anthony and Mr. Jiang Hongqing as independent non-executive Director.

The Directors jointly and severally accept full responsibility for the accuracy of the information (other than information relating to the Share Subscriber and the CB Subscriber) contained in this announcement and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement the omission of which would make any statement in this announcement misleading.

The sole director of the CB Subscriber, namely Mr. Deng Jun Jie, accepts full responsibility for the accuracy of the information relating to the CB Subscriber contained in this announcement and confirm, having made all reasonable inquiries, that to the best of his knowledge, opinions expressed by the CB Subscriber in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

As at the date of this announcement, the directors of China Minsheng Jiaye Investment Co., Ltd.* are Zhang Zhichao (Chairman), Lin Tengjiao, Wu Chen, Liu Yueping, Fang Rong, Shi Yuwei and Cao Zhenling.

The directors of China Minsheng Jiaye Investment Co., Ltd. jointly and severally accept full responsibility for the accuracy of the information in relation to China Minsheng Jiaye Investment Co., Ltd. in this announcement and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed by China Minsheng Jiaye Investment Co., Ltd.* in this announcement have been arrived at after due and careful consideration and there are no other facts in relation to itself not contained in this announcement, the omission of which would make any statements in this announcement misleading.

For identification purposes only

AI assistant

DIT Group Limited — Capital/Financing Update 2015

49427_rns_2015-03-08_7807565d-78fd-4de3-be95-0f4904cf55c5.pdf

(1) PROPOSED ISSUE OF NEW SHARES UNDER SPECIFIC MANDATE (2) WHITEWASH WAIVER (3) PROPOSED ISSUE OF CONVERTIBLE BONDS (4) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL AND

(5) RESUMPTION OF TRADING

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

PROPOSED ISSUE OF NEW SHARES UNDER SPECIFIC MANDATE

WHITEWASH WAIVER

PROPOSED ISSUE OF CONVERTIBLE BONDS

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

SGM

GENERAL

RESUMPTION OF TRADING

PROPOSED ISSUE OF NEW SHARES

Principal terms of the Share Subscription Agreement

Ranking of the Subscription Shares

The Subscription Price

Conditions for the Share Subscription

Information of the Share Subscriber

Dealings and interest held in the Company’s securities by the Share Subscriber and its concert parties

Whitewash Waiver

PROPOSED ISSUE OF CONVERTIBLE BONDS

Principal terms of the CB Subscription Agreement

The CB Subscription

Conditions for the CB Subscription

Completion of the CB Subscription

Information of the CB Subscriber

Principal terms of the Convertible Bonds

Conversion Shares:

Redemption:

Conversion Price

The Conversion Shares

REASONS FOR THE SHARE SUBSCRIPTION AND THE CB SUBSCRIPTION AND INTENDED USE OF PROCEEDS

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

SPECIFIC MANDATES TO ISSUE THE SUBSCRIPTION SHARES AND THE CONVERSION SHARES

APPLICATION FOR LISTING

FUND RAISING ACTIVITIES DURING THE PAST TWELVE MONTHS

CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY

SGM

GENERAL

RESUMPTION OF TRADING

DEFINITIONS

“HSBC”

Hong Kong, 9 March 2015

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DIT Group Limited Capital/Financing Update 2015