Fufeng Group Limited - Capital/Financing Update 2013

THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Important: If you are in any doubt about any of the contents of this Prospectus (as defined herein) or as to the action to be taken, you should obtain independent professional advice.

If you have sold or transferred all your shares in Fufeng Group Limited, you should at once hand this Prospectus and the accompanying PAL (as defined herein) and EAF (as defined herein) to the purchaser(s) or transferee(s) or to the bank, licenced securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

A copy of each of the Rights Issue Documents (as defined herein), together with the written consent referred to in the paragraph headed “Expert and Consent” in Appendix III to this Prospectus, have been registered with the Registrar of Companies in Hong Kong as required by Section 342C of the Companies Ordinance (as defined herein). The Registrar of Companies in Hong Kong and the SFC (as defined herein) take no responsibility as to the contents of any of the Rights Issue Documents or any other documents referred to above.

Subject to the granting of listing of, and permission to deal in, the Rights Shares (as defined herein) in both nil-paid and fully-paid forms on the Stock Exchange and compliance with the stock admission requirements of HKSCC (as defined herein), the Rights Shares in both nil-paid and fully-paid forms will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS (as defined herein) with effect from their respective commencement dates of dealings on the Stock Exchange or such other date as may be determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second trading day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time.

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

This Prospectus is for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale or purchase of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. Neither this Prospectus nor anything in this Prospectus forms the basis of any contract or commitment whatsoever.

The securities referred to herein have not been and will not be registered under the U.S. Securities Act (as defined herein) or the laws of any state of the United States, and may not be offered, sold, taken up, resold, renounced, transferred or delivered, directly or indirectly, in or into the United States, absent registration or an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in compliance with applicable state securities laws. There is no intention to register any portion of the rights issue or any securities described herein in the United States or to conduct a public offering of securities in the United States.

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Fufeng Group Limited 阜豐集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 546)

RIGHTS ISSUE OF RIGHTS SHARES AT HK$1.80 EACH ON THE BASIS OF 1 RIGHTS SHARE FOR EVERY 5 SHARES HELD ON THE RECORD DATE

Joint Financial Advisors to Fufeng Group Limited

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Joint Underwriters of the Rights Issue

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The latest time for acceptance of and payment for the Rights Shares is 4:00 p.m. on Thursday, 25 April 2013. The procedures for acceptance and payment is set out on pages 16 to 23 of this Prospectus.

The Underwriting Agreement (as defined herein) contains provisions entitling the Joint Underwriters (as defined herein) by written notice to the Company served prior to 4:00 p.m. on Monday, 29 April 2013 to terminate the Underwriting Agreement on the occurrence of certain events including force majeure as set out in the section headed “Termination of the Underwriting Agreement” on pages 9 to 10 of this Prospectus. If the Joint Underwriters terminate the Underwriting Agreement on or before the aforesaid deadline, or if the conditions of the Underwriting Agreement are not fulfilled (or waived by the Joint Underwriters) in accordance with the terms thereof, the Rights Issue will not proceed.

The Shares (as defined herein) have been dealt in on an ex-rights basis from Wednesday, 3 April 2013. Dealings in the Rights Shares in the nil-paid form are expected to take place from Monday, 15 April 2013 to Monday, 22 April 2013 (both dates inclusive). Any Shareholder or other person dealing in Shares up to the date on which all the conditions to which the Rights Issue is subject are fulfilled (and the date on which the Joint Underwriters’s right of termination of the Underwriting Agreement ceases) and any person dealing in the nil-paid Rights Shares during the period from Monday, 15 April 2013 to Monday, 22 April 2013 (both dates inclusive) will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed. Shareholders should therefore exercise caution when dealing in the Shares, and if they are in any doubt about their position, they are recommended to consult their professional advisers.

11 April 2013

NOTICES

The Rights Issue is conditional upon the Underwriting Agreement becoming unconditional and not being terminated in accordance with its terms. If the conditions of the Rights Issue are not fulfilled, the Rights Issue will not proceed, in which case, a further announcement will be made by the Company at the relevant time. It should be noted that the existing Shares have been dealt in on an ex-rights basis from Wednesday, 3 April 2013, and the nil paid rights will be dealt in from Monday, 15 April 2013 to Monday, 22 April 2013 (both days inclusive). Such dealings will take place when the conditions of the Rights Issue remain unfulfilled. Any person dealing in the securities of the Company up to the date on which such conditions are fulfilled and any person dealing in the nil paid rights from Monday, 15 April 2013 to Monday, 22 April 2013 (being the first and last day of dealings in the nil paid rights, respectively) will accordingly bear the risk that the Rights Issue may not become unconditional and may not proceed. Shareholders and potential investors should therefore exercise caution when dealing in the Shares and/or the nil paid rights, and if they are in any doubt about their position, they are recommended to consult their professional advisers.

EXCEPT AS OTHERWISE SET OUT HEREIN, THE RIGHTS ISSUE DESCRIBED IN THIS PROSPECTUS IS NOT BEING MADE TO SHAREHOLDERS WITH REGISTERED ADDRESSES IN JURISDICTIONS OUTSIDE HONG KONG AND NEITHER IS THE RIGHTS ISSUE BEING MADE TO INVESTORS WHO ARE LOCATED OR RESIDENT IN ANY OF THE JURISDICTIONS OUTSIDE HONG KONG, UNLESS AN OFFER OF RIGHTS SHARES AND NIL-PAID RIGHTS INTO SUCH JURISDICTIONS COULD LAWFULLY BE MADE WITHOUT COMPLIANCE WITH ANY REGISTRATION OR OTHER LEGAL OR REGULATORY REQUIREMENTS OR THE OFFER IS MADE IN RELIANCE ON ANY EXEMPTION OR WHERE COMPLIANCE IS NOT UNDULY BURDENSOME. This Prospectus does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, the nil paid rights or fully-paid Rights Shares or to take up any entitlements to the nil paid rights or fully-paid Rights Shares in any jurisdiction in which such an offer or solicitation is unlawful. None of the nil paid rights, the fully-paid Rights Shares, this Prospectus, the PAL and the EAF will be registered under the securities laws of any of the jurisdictions other than in Hong Kong and none of the nil paid rights, the fully-paid Rights Shares, this Prospectus, the PAL and the EAF will qualify for distribution under any of the relevant securities laws of any of the jurisdictions outside Hong Kong (other than pursuant to any applicable exceptions as agreed by the Company). Accordingly, the nil paid rights and the fully-paid Rights Shares may not be offered, sold, pledged, taken up, resold, renounced, transferred or delivered, directly or indirectly, into or within any of the jurisdictions outside Hong Kong absent registration or qualification under the respective securities laws of such jurisdictions, or exemption from the registration or qualification requirements under applicable rules of such jurisdictions.

Shareholders with registered addresses in, and investors who are located or resident in, any of the jurisdictions outside Hong Kong or who hold Shares on behalf of persons with such addresses should refer to the paragraph headed “Non-Qualifying Shareholders” under the section headed “Letter from the Board” of this Prospectus.

– i –

NOTICES

Each person acquiring the nil paid rights and/or Rights Shares under the Rights Issue will be required to confirm, or be deemed by his acquisition of the nil paid rights and/or Rights Shares to confirm, that he is aware of the restrictions on offers and sales of the nil paid rights and/or Rights Shares described in this Prospectus. For a description of certain restrictions regarding the taking up of the nil paid rights for, and the offering and sale of, the Rights Shares, see the notices below.

FORWARD-LOOKING STATEMENTS

All statements in this Prospectus other than statements of historical fact are forward looking statements. In some cases, forward-looking statements may be identified by the use of words such as “might”, “may”, “could”, “would”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “plan”, “seek”, “continue”, “illustration”, “projection” or similar expressions and the negative thereof. Forward-looking statements in this Prospectus include, without limitation, statements in respect of the Group’s business strategies, product offerings, market position, competition, financial prospects, performance, liquidity and capital resources, as well as statements regarding trends in the relevant industries and markets in which the Group operates, financial and economic developments, legal and regulatory changes and their interpretation and enforcement.

The forward-looking statements in this Prospectus are based on management’s present expectations about future events. Management’s present expectations reflect numerous assumptions regarding the Group’s strategy, operations, industry, developments in the credit and other financial markets and trading environment. By their nature, they are subject to known and unknown risks and uncertainties, which could cause actual results and future events to differ materially from those implied or expressed by forward-looking statements. Should one or more of these risks or uncertainties materialise, or should any assumptions underlying forward-looking statements prove to be incorrect, the Group’s actual results could differ materially from those expressed or implied by forward-looking statements. Additional risks not known to the Group or that the Group does not currently consider material could also cause the events and trends discussed in this Prospectus not to occur, and the estimates, illustrations and projections of financial performance not to be realised.

Prospective investors are cautioned that forward-looking statements speak only as at the date of publication of this Prospectus. Except as required by applicable law, the Group does not undertake, and expressly disclaims, any duty to revise any forward-looking statement in this Prospectus, be it as a result of new information, future events or otherwise.

– ii –

CONTENTS

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Expected Timetable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		7
Termination of the Underwriting Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		9
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		11
Appendix I	– Financial Information of the Group . . . . . . . . . . . . . . . . . .	33
Appendix II	– Unaudited Pro Forma Financial Information
	of the Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	36
Appendix III	– General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	40

– iii –

DEFINITIONS

In this Prospectus, unless the context otherwise requires, the following expressions shall have the following meanings:

“Acceptance Date”
25 April 2013, being the last day for acceptance of and payment of the Rights Shares and application and payment for excess Rights Shares, or such other date as the Company and the Joint Underwriters may agree in writing
“Announcement”
the announcement of the Company dated 26 March 2013 relating to, inter alia, the Rights Issue
“Beneficial Owner”
any beneficial owner of Shares whose Shares are registered in the name of a Registered Shareholder
“Board”
the board of Directors
“Business Day”
a day (excluding Saturdays) on which banks are generally open for business in Hong Kong
“BVI”
British Virgin Islands
“BVI 1”
Ever Soar Enterprises Limited, a limited liability company incorporated in the BVI, and is a Substantial Shareholder as at the Latest Practicable Date. The shareholders of BVI 1 include existing and former directors and management of members of the Group
“BVI 2”
Excel Energy Limited, a limited liability company incorporated in the BVI, and is a Shareholder as at the Latest Practicable Date. The shareholders of BVI 2 are existing and former management of members of the Group
“BVI 3”
Hero Elite Limited, a limited liability company incorporated in the BVI, and is a Shareholder as at the Latest Practicable Date. The shareholders of BVI 3 are existing and former management of members of the Group
“BVI 4”
Advanced Quality Limited, a limited liability company incorporated in the BVI, and is a Shareholder as at the Latest Practicable Date. The shareholders of BVI 4 are existing and former management of members of the Group

– 1 –

DEFINITIONS

“BVI Controlling Shareholder”
Motivator Enterprises Limited, a limited liability company incorporated in the BVI, the entire issued share capital of which is wholly and beneficially owned by Mr. Li Xuechun, an executive Director and the chairman of the Company. As at the Latest Practicable Date, it holds approximately 46.1% of the total issued share capital of the Company
“CCASS”
the Central Clearing and Settlement System established and operated by HKSCC
“Companies Ordinance” the Companies Ordinance (Chapter 32 of the Laws of Hong Kong)
“Company” Fufeng Group Limited, a company incorporated in the Cayman Islands with limited liability, the Shares of which are listed on the main board of the Stock Exchange
“Controlling Shareholder”
has the same meaning as defined in the Listing Rules
“Convertible Bonds”
the convertible bonds issued by the Company pursuant to a subscription agreement dated 25 March 2010
“Directors”
the directors of the Company
“EAF(s)”
application form(s) for excess Rights Shares to be issued in connection with the Rights Issue
“Group” the Company and its subsidiaries
“HKSCC”
Hong Kong Securities Clearing Company Limited
“Hong Kong”
the Hong Kong Special Administrative Region of the PRC
“Hulunbeir Plant”
the production plant of the Group located at Hulunbeir, Inner Mongolia Autonomous Region, the PRC
“Independent Third Parties”
third parties that are independent of the Company and its connected persons as defined under the Listing Rules

– 2 –

DEFINITIONS

“Irrevocable Undertaking (BVI 1)”
“Irrevocable Undertaking (BVI 2)”
“Irrevocable Undertaking (BVI 3)”
“Irrevocable Undertaking (BVI 4)”
“Irrevocable Undertaking (BVI Controlling Shareholder)”
“Irrevocable Undertaking (Mr. Wang)”
“Irrevocable Undertakings”
“Joint Underwriters”
the irrevocable undertaking letter dated 25 March 2013 and executed by BVI 1 in favour of the Company and the Joint Underwriters
the irrevocable undertaking letter dated 25 March 2013 and executed by BVI 2 in favour of the Company and the Joint Underwriters

the irrevocable undertaking letter dated 25 March 2013 and executed by BVI 3 in favour of the Company and the Joint Underwriters

the irrevocable undertaking letter dated 25 March 2013 and executed by BVI 4 in favour of the Company and the Joint Underwriters
the irrevocable undertaking letter dated 25 March 2013 and executed by BVI Controlling Shareholder in favour of the Company and the Joint Underwriters
the irrevocable undertaking letter dated 25 March 2013 and executed by Mr. Wang in favour of the Company and the Joint Underwriters

the Irrevocable Undertaking (BVI Controlling Shareholder), the Irrevocable Undertaking (BVI 1), the Irrevocable Undertaking (BVI 2), the Irrevocable Undertaking (BVI 3), the Irrevocable Undertaking (BVI 4) and the Irrevocable Undertaking (Mr. Wang)

China Galaxy International Securities (Hong Kong) Co., Limited, a registered institution licensed to conduct Type 1 regulated activity (dealing in securities), Type 4 regulated activity (advising on securities) and Type 6 regulated activity (advising on corporate finance) under the SFO

CCB International Capital Limited, a registered institution licensed to conduct Type 1 regulated activity (dealing in securities) and Type 6 regulated activity (advising on corporate finance) under the SFO

GuocoCapital Limited, a registered institution licensed to conduct Type 1 regulated activity (dealing in securities), Type 4 regulated activity (advising on securities), and Type 6 regulated activity (advising on corporate finance) under the SFO

– 3 –

DEFINITIONS

“Last Trading Day”
“Latest Practicable Date”
“Latest Time for Termination”
“Listing Rules”
“Mr. Wang”
“Non-Qualifying Shareholder(s)”
“Outstanding Convertible Bonds”
“Overseas Shareholder(s)”
“PAL(s)”
“Posting Date”
“PRC”
25 March 2013, being the last trading day of the Shares on the Stock Exchange prior to the date of Announcement
8 April 2013, being the latest practicable date prior to the printing of this Prospectus for the purpose of ascertaining certain information contained herein
4:00 p.m. on the second Business Day after the Acceptance Date
the Rules Governing the Listing of Securities on the Stock Exchange
an executive Director of the Company, directly holding 6,910,000 issued Shares and interested in 14.3% of the issued share capital of BVI 3 as at the Latest Practicable Date
those Overseas Shareholder(s) whom the Directors, after making reasonable enquiries, consider it necessary or expedient to exclude on account either of the legal restrictions under the laws of the relevant place or the requirements of the relevant regulatory body or stock exchange in that place
the Convertible Bonds issued by the Company with an aggregate outstanding principal amount of RMB14,200,000, which entitle the holders of the Convertible Bonds to convert, at an initial conversion price of HK$7.03, to a maximum of 2,296,140 Shares
the Shareholder(s) whose name(s) appear(s) on the register of members of the Company at 5:00 p.m. on the Record Date and whose registered address(es) as shown on such register is (are) outside Hong Kong
provisional allotment letter(s) for the Rights Shares to be issued in connection with the Rights Issue
11 April 2013 or such other date as the Joint Underwriters may agree in writing with the Company for the despatch of the Rights Issue Documents
the People’s Republic of China

– 4 –

DEFINITIONS

“Prospectus”
“Qualifying Shareholder(s)”
“Record Date”
“Registered Shareholder”
“Registrar”
“Registrar of Companies”
“Rights Issue”
“Rights Issue Documents”
“Rights Share(s)”
“Settlement Date”
“SFO”
“Share(s)”
“Shareholder(s)”
the Prospectus to be issued by the Company in relation to, among other things, the Rights Issue
the Shareholder(s) whose name(s) appear(s) on the register of members of the Company at 5:00 p.m. on the Record Date
10 April 2013, the record date for the determination of the entitlements to the Rights Issue
in respect of a Beneficial Owner, means a nominee, trustee, depository or any other authorised custodian or third party which is the registered holder in the register of members of the Company of the Shares in which the Beneficial Owner is beneficially interested
the branch share registrar of the Company in Hong Kong, being Tricor Investor Services Limited of 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong
the Registrar of Companies in Hong Kong
the proposed issue of 348,209,600 Rights Shares at a price of HK$1.80 per Rights Share on the basis of 1 Rights Share for every 5 existing Shares held on the Record Date payable in full on acceptance
the Prospectus, the PALs and the EAFs
348,209,600 new Share(s) to be allotted and issued by the Company under the Rights Issue
29 April 2013, being the second Business Day following the Acceptance Date (or such other time or date as the Joint Underwriters and the Company may agree in writing) as the day for settlement of the Rights Issue
the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
ordinary share(s) of HK$0.1 each in the share capital of the Company
holder(s) of the Share(s)

– 5 –

DEFINITIONS

“Share Option Scheme”
“Share Options”
“Stock Exchange”
“Subscription Price”
“Substantial Shareholder”
“Underwriting Agreement”
“Underwritten Rights Shares”
“U.S. Securities Act”
“Vested Share Options”
“HK$”
“%”
the post-IPO share option scheme adopted by the Company on 10 January 2007 which came into effect after the initial listing of the Shares on the Stock Exchange on 8 February 2007
options to subscribe for Shares granted under the Share Option Scheme

The Stock Exchange of Hong Kong Limited

HK$1.80 per Rights Share
has the same meaning as defined in the Listing Rules
the underwriting agreement dated 25 March 2013 between the Company and the Joint Underwriters relating to the underwriting and other arrangements in respect of the Rights Issue
the Rights Shares other than the Right Shares for which BVI Controlling Shareholder, BVI 1, BVI 2, BVI 3 and BVI 4 and Mr. Wang have undertaken to subscribe pursuant to the Irrevocable Undertakings
the U.S. Securities Act of 1933, as amended
the 29,878,200 Share Options granted to the eligible employees of the Company, which are vested and exercisable on or before the Record Date
Hong Kong dollars, the lawful currency of Hong Kong

per cent.

– 6 –

EXPECTED TIMETABLE

The expected timetable for the Rights Issue set out below is for indicative purposes only and it has been prepared on the assumption that all the conditions of the Rights Issue will be fulfilled. The expected timetable is subject to change, and any changes will be announced in a separate announcement by the Company as and when appropriate.

2013

Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 10 April	Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 10 April
Register of members of the Company re-opens	. . . . . . . . . . . . . . . . . Thursday, 11 April
Despatch of Rights Issue Documents . . . . . . .	. . . . . . . . . . . . . . . . . . Thursday, 11 April
First day of dealings in nil-paid Rights Shares	. . . . . . . . . . . . . . . . . . . Monday, 15 April
Latest time for splitting nil-paid Rights Shares	. . . . . . 4:30 p.m. on Wednesday, 17 April
Last day of dealings in nil-paid Rights Shares .	. . . . . . . . . . . . . . . . . . . Monday, 22 April
Latest time for acceptance of, and payment for,
Rights Shares and application and
payment for excess Rights Shares . . . . . . . .	. . . . . . . . 4:00 p.m. on Thursday, 25 April
Rights Issue expected to become unconditional	. . . . . . . . 4:00 p.m. on Monday, 29 April

Announcement of results of the Rights Issue to be published on the respective websites of the Stock Exchange and the Company . . . . . . . . . . . . . . . . . . . . . . Tuesday, 30 April
Refund cheques in respect of wholly or
partially unsuccessful applications for excess Rights Shares to be despatched on or before . . . . . . . . . . . . . . Thursday, 2 May
Certificates for fully-paid Rights Shares to be despatched on or before . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thursday, 2 May
Certificates for fully-paid Rights Shares

Dealing in fully-paid Rights Shares

on the Stock Exchange expected to commence on . . . . . . . . . . . . . . . . . . Friday, 3 May

Note: All times and dates in this Prospectus refer to Hong Kong local times and dates. Dates or deadlines specified in this Prospectus are indicative only and may be varied by agreement between the Company and the Joint Underwriters. Any consequential changes to the expected timetable will be published or notified to the Shareholders by way of announcement(s).

– 7 –

EXPECTED TIMETABLE

EFFECT OF BAD WEATHER ON THE LATEST TIME FOR ACCEPTANCE OF AND PAYMENT FOR RIGHTS SHARES

The latest time for acceptance of and payment for the Rights Shares will not take place if there is a tropical cyclone warning signal no. 8 or above, or a “black” rainstorm warning:

(i) in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on Thursday, 25 April 2013. In such event, the latest time for acceptance of and payment for the rights shares will be extended to 5:00 p.m. on the same Business Day; and
(ii) in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on Thursday, 25 April 2013. In such event, the latest time of acceptance of and payment for the Rights Shares will be rescheduled to 4:00 p.m. on the following business day which does not have either of those warnings in force at any time between 9:00 a.m. and 4:00 p.m.

If the latest time for acceptance of and for application and payment for excess Rights Shares does not take place on Thursday, 25 April 2013, the dates mentioned in the paragraph headed “Expected Timetable” above may be affected. The Company will notify the Shareholders by way of announcements on any further change to the expected timetable as soon as practicable.

– 8 –

TERMINATION OF THE UNDERWRITING AGREEMENT

TERMINATION OF THE UNDERWRITING AGREEMENT

The Underwriting Agreement contains provisions granting the Joint Underwriters, by notice in writing, the ability to terminate its obligations thereunder on the occurrence of certain events.

The Joint Underwriters may terminate the arrangements set out in the Underwriting Agreement by notice in writing issued to the Company by the Joint Underwriters at any time prior to the Latest Time for Termination if there occurs:

(i) an introduction of any new law or regulation or any change in existing law or regulation (or the judicial interpretation thereof); or
(ii) any local, national or international event or change (whether or not forming part of a series of events or changes occurring or continuing before, and/or after the date of the Underwriting Agreement) of a political, military, financial, economic or currency (including any disruption to trading generally or trading in any securities of the Company on any stock exchange, or a change in the system under which the value of the Hong Kong currency is linked to the currency of the United States of America) or other nature (whether or not such are of the same nature as any of the foregoing) or of the nature of any local, national or international outbreak or escalation of hostilities, insurrection or armed conflict; or
(iii) any act of God, fire, flood, explosion, epidemic, earthquake, nuclear or natural disaster, war, act of terrorism, riot, public disorder, civil commotion, strike or lock-out; or
(iv) any suspension or a material limitation in trading in securities generally on the Stock Exchange, or a general moratorium on commercial banking activities in Hong Kong declared by the relevant authorities or a material disruption in commercial banking or securities settlement or clearance services in Hong Kong;

and in the absolute opinion of the Joint Underwriters such change could have a material and adverse effect on the business, financial or trading position or prospects of the Group as a whole or the success of the Rights Issue or make it inadvisable or inexpedient to proceed with the Rights Issue.

If, at or prior to the Latest Time for Termination:

(i) the Company commits any material breach of or omits to observe any of the obligations, undertakings, representations or warranties expressed to be assumed by it under the Underwriting Agreement; or
(ii) the Joint Underwriters shall receive notification, or shall otherwise become aware of, the fact that any of the representations or warranties contained in the Underwriting Agreement was, when given, untrue, inaccurate or misleading, or would be untrue, inaccurate or misleading; or

– 9 –

TERMINATION OF THE UNDERWRITING AGREEMENT

(iii) the Company shall, after any matter or event of misrepresentation, breach of warranty and undertaking referred to in the Underwriting Agreement has occurred or come to the Joint Underwriters’ attention, fail promptly to send out any announcement or circular (after the despatch of the Rights Issue Documents), in such manner (and as appropriate with such contents) as the Joint Underwriters may request for the purpose of preventing the creation of a false market in the securities of the Company; the Joint Underwriters shall be entitled (but not bound) by notice in writing issued by the Joint Underwriters to the Company to elect to treat such matter or event as releasing and discharging the Underwriters from their obligations under the Underwriting Agreement.

In the event the Joint Underwriters exercises the right to terminate the Underwriting Agreement upon the giving of written notice of termination prior to the Latest Time for Termination, all the obligations of the Joint Underwriters under the Underwriting Agreement shall cease and determine and no party shall have any claim against the other parties in respect of any matter or thing arising out of or in connection with the Underwriting Agreement (save in respect of any antecedent breaches and claims) provided that the Company shall remain liable to pay such fees and expenses as agreed by the parties pursuant to the Underwriting Agreement.

If the Joint Underwriters exercises such right, the Rights Issue will not proceed. A further announcement will be made if the Underwriting Agreement is terminated by the Joint Underwriters.

WARNING OF THE RISKS OF DEALINGS IN THE SHARES AND RIGHTS SHARES

The Shares have been dealt in on an ex-rights basis from Wednesday, 3 April 2013. Dealing in the Rights Shares in the nil-paid form will take place from Monday, 15 April 2013 to Monday, 22 April 2013 (both dates inclusive). If the conditions of the Underwriting Agreement are not fulfilled or the Underwriting Agreement is terminated by the Joint Underwriters, the Rights Issue will not proceed.

Any Shareholders or other persons contemplating selling or purchasing Rights Shares in their nil-paid form during the period from Monday, 15 April 2013 to Monday, 22 April 2013 (both dates inclusive) who are in any doubt about their position are recommended to consult their professional advisers.

Any Shareholders or other persons dealing in the Shares up to the date on which all the conditions to which the Rights Issue is subject are fulfilled (and the date on which the Joint Underwriters’ right of termination of the Underwriting Agreement ceases) and any persons dealing in the nil-paid Rights Shares during the period from Monday, 15 April 2013 to Monday, 22 April 2013 (both dates inclusive) will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed.

– 10 –

LETTER FROM THE BOARD

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Fufeng Group Limited 阜豐集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 546)

Executive Directors: Mr. Li Xuechun (Chairman) Mr. Wang Longxiang Mr. Feng Zhenquan Mr. Xu Guohua Mr. Li Deheng Mr. Chen Yuan Mr. Li Guangyu

Independent non-executive Directors: Mr. Choi Tze Kit, Sammy Mr. Chen Ning Mr. Liang Wenjun Ms. Zheng Yu

Registered office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Place of business in Hong Kong: Suite 1102, 11th Floor Chinachem Century Tower 178 Gloucester Road Wanchai, Hong Kong

11 April 2013

To the Qualifying Shareholders, and for information only, holders of Share Options and holders of the Convertible Bonds

Dear Sir or Madam

RIGHTS ISSUE OF RIGHTS SHARES AT HK$1.80 EACH ON THE BASIS OF 1 RIGHTS SHARE FOR EVERY 5 SHARES HELD ON THE RECORD DATE

INTRODUCTION

The Board announced on 26 March 2013 that the Company proposes to raise approximately HK$627 million (assuming no further issuance of Shares before the Record Date) to HK$638 million (assuming the Vested Share Options are fully exercised and the Outstanding Convertible Bonds are fully converted into Shares of the Company) before expenses by way of the Rights Issue of not less than 348,209,600 and not more than 354,644,468 Rights Shares to the Shareholders at a price of HK$1.80 per Rights Share. The Company will provisionally allot 1 Rights Share in nil-paid form for every 5 Shares held by the Qualifying Shareholders on the Record Date. The Rights Issue will not be available to the Non-Qualifying Shareholders (if any).

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LETTER FROM THE BOARD

The primary purpose of this Prospectus is to provide you with further details of the Rights Issue, including information on dealing in, transfer and acceptance of the Rights Shares, the procedure for the acceptance of provisional allotments of the Rights Shares and application for excess Rights Shares, and certain financial and other information in respect of the Group.

RIGHTS ISSUE

The terms of the Rights Issue are set out below:

Issue Statistics

Basis of the Rights Issue : one (1) Rights Share for every five (5) Shares held on the Record Date Number of Shares in issue : 1,741,048,000 Shares as at the Record Date Number of Rights Shares : 348,209,600 Rights Shares with an aggregate nominal value of HK$34,820,960 Subscription Price : HK$1.80 per Rights Share Amount to be raised : Approximately HK$627 million before expenses Joint Underwriters : China Galaxy International Securities (Hong Kong) Co., Limited; CCB International Capital Limited; and GuocoCapital Limited Underwriting commission : 2.5% of the Rights Shares subscription proceeds in respect of the Underwritten Rights Shares Enlarged issued share : 2,089,257,600 Shares capital of the Company upon completion of the Rights Issue

As at the Latest Practicable Date, the Company had (i) 50,270,000 outstanding Share Options (of which 29,878,200 Share Options are vested and exercisable as at the Latest Practicable Date) and (ii) the Convertible Bonds with an aggregate outstanding principal amount of RMB14,200,000 conferring rights to convert into a total of 2,296,140 Shares. The Outstanding Convertible Bonds if converted into Shares would be allotted and issued pursuant to the general mandate of the Company granted to the Directors at the annual general meeting held on 28 April 2009. Save as the aforesaid, the Company does not have any outstanding convertible securities, options (whether agreed conditionally or unconditionally) or warrants in issue which would otherwise confer any right to subscribe for, convert or exchange into existing Shares as at the Latest Practicable Date. The

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LETTER FROM THE BOARD

Directors confirmed that from the date of the announcement of the Company in respect of the Rigths Issue, being 26 March 2013 till 4.30 p.m. on Friday, 5 April 2013 (being the latest time for lodging transfers of Shares in order to qualify for the Rights Issue), none of the abovementioned holders of the Share Options or the Outstanding Convertible Bonds has served a notice to the Company to exercise their respective rights thereunder. Therefore as at the Record Date, the number of Shares in issue was 1,741,048,000 Shares and the number of Rights Shares proposed to be issued under the Rights Issue would be 348,209,600.

The nil-paid Right Shares to be provisionally allotted pursuant to the terms of the Rights Issue represent 20% of the Company’s issued share capital as at the Latest Practicable Date or approximately 16.67% of the Company’s enlarged issued share capital as enlarged by the issue of the Rights Shares.

The Subscription Price under the Rights Issue is HK$1.80 per Rights Share, payable in full when a Qualifying Shareholder accepts the relevant provisional allotment of the Rights Shares or applies for excess Rights Shares or when a transferee of nil-paid Rights Shares subscribes for the Rights Shares.

The Subscription Price represents:

(i) a discount of approximately 39.80% to the closing price of HK$2.99 per Share as quoted on the Stock Exchange on the Last Trading Day;
(ii) a discount of approximately 35.48% to the theoretical ex-rights price of approximately HK$2.79 based on the closing price of HK$2.99 per Share as quoted on the Stock Exchange on the Last Trading Day;
(iii) a discount of approximately 39.60% to the average closing price of HK$2.98 per Share as quoted on the Stock Exchange for the 5 consecutive trading days up to and including the Last Trading Day;
(iv) a discount of approximately 39.80% to the average closing price of HK$2.99 per Share as quoted on the Stock Exchange for the 10 consecutive trading days up to and including the Last Trading Day;
(v) a discount of approximately 34.46% to the net asset value per Share of approximately HK$2.75 (based on the latest audited net asset value of the Group as at 31 December 2012, 1,741,048,000 Shares in issue as at the Latest Practicable Date and RMB to Hong Kong Dollar exchange rate of 1:1.26); and
(vi) a discount of approximately 30.77% to the closing price of HK$2.60 per Share, as quoted on the Stock Exchange on the Latest Practicable Date.

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LETTER FROM THE BOARD

Each Rights Share will have a par value of HK$0.10.

The Subscription Price was arrived at after arm’s length negotiations between the Company and the Joint Underwriters with reference to the market price of the Shares under the prevailing market conditions. The Directors consider that the discounts to the relative values as indicated above would encourage existing Shareholders to take up their entitlements so as to participate in the future development of the Group.

The Directors consider the terms of the Rights Issue, including the Subscription Price, are fair and reasonable and are in the best interests of the Company and the Shareholders as a whole.

Basis of provisional allotments

The basis for provisional allotment shall be one (1) Rights Share (in nil-paid form) for every five (5) Shares held by the Qualifying Shareholders on the Record Date.

Application for all or any part of a Qualifying Shareholder’s provisional allotment should be made by completing the PAL and lodging the same with a remittance for the Rights Shares being applied for.

Status of the Rights Shares

When allotted, issued and fully paid, the Rights Shares will rank pari passu in all respects with the then existing Shares in issue and holders of such Rights Shares will be entitled to receive all future dividends and distributions which may be declared, made or paid after the date of allotment and issue of the Rights Shares in their fully-paid form.

Fractions of Rights Shares (if any)

The Company will not provisionally allot fractions of Rights Shares in nil-paid form nor will it accept any application for any fraction of the Rights Shares. All fractions of Rights Shares will be aggregated (rounded down to the nearest whole number) and all nil-paid Rights Shares arising from such aggregation will be sold in the market for the benefit of the Company, if a premium net of expenses can be achieved. Any unsold aggregate of fractions of nil-paid Rights Shares will be available to meet excess applications by the Qualifying Shareholders.

Qualifying Shareholders

The Company will send the Rights Issue Documents to the Qualifying Shareholders and the Prospectus only to respective holders of the Share Options and Convertible Bonds (if required by the terms and conditions of the Share Option Scheme and Convertible Bonds respectively) for their information only.

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LETTER FROM THE BOARD

To qualify for the Rights Issue, a Shareholder must:

(i) be registered as a member of the Company at the close of business on the Record Date; and
(ii) be a Qualifying Shareholder.

Application for all or part of a Qualifying Shareholder’s provisional allotment should be made by completing the PAL and lodging the same with a remittance for the Rights Shares being applied for.

Qualifying Shareholders who take up their pro rata entitlement in full under the Rights Issue will not suffer any dilution to their interests in the Company. If a Qualifying Shareholder does not take up any of his/her/its entitlement in full under the Rights Issue, his/her/its proportionate shareholding in the Company will be diluted.

Non-Qualifying Shareholders

The Rights Issue Documents have not been and will not be registered under the applicable securities legislation of any jurisdictions other than Hong Kong.

According to the register of members of the Company as at the Record Date, all the Shareholders have registered addresses in Hong Kong and the Company had no Overseas Shareholders. Based on these records, all the Shareholders as at the Record Date were Qualifying Shareholders and there was no Non- Qualifying Shareholder for the purpose of the Rights Issue. Shareholders or investors are advised to consider the matters set out under the paragraph headed “Procedures for acceptance and payment or transfer” under the section headed “Letter from the Board” before applying for the Rights Shares.

No person receiving a PAL or an EAF in any territory or jurisdiction other than Hong Kong may treat it as an offer or invitation to apply for the Rights Shares, unless in a territory or jurisdiction where such an offer or invitation could lawfully be made without compliance with any registration or other legal and regulatory requirements thereof or where the offer is made in reliance on any exemption or where compliance with the relevant legal or regulatory requirement will not, in the Board’s judgment, be unduly burdensome.

Notwithstanding any other provision in the Rights Issue Documents, the Company reserves the right to permit any Shareholder or investor (whether as a direct holder or Beneficial Owner) whose registered address is in, or who is otherwise resident in, a jurisdiction other than Hong Kong to take up his/her/its Rights Shares if the Company, in its absolute discretion, is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations in that jurisdiction which would otherwise give rise to restrictions upon the offer or take-up of Rights Shares in that jurisdiction.

Receipt of this Prospectus and/or a PAL and/or an EAF or the crediting of nil-paid Rights Shares to any stock account (including in CCASS) does not and will not constitute an offer in any jurisdictions in which it would be illegal to make an offer and, in those

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circumstances, this Prospectus and/or a PAL and/or an EAF must be treated as sent for information only and should not be copied or redistributed. Persons (including, without limitation, agents, custodians, nominees and trustees) who receive a copy of this Prospectus and/or a PAL and/or an EAF or whose stock account in CCASS is credited with nil paid rights should not, in connection with the Rights Issue, distribute or send the same in, into or from, or transfer nil paid rights to any person in, into or from, any jurisdiction outside Hong Kong, unless an offer of Rights Shares and nil paid rights into such jurisdiction could lawfully be made without compliance with any registration or other legal or regulatory requirements or where the offer is made in reliance on any exemption or where compliance with the relevant legal or regulatory requirement will not, in the Board’s judgement, be unduly burdensome. If a PAL or an EAF or a credit of nil paid rights in CCASS is received by any person in any such territory, or by his/her/its agent custodian, nominee or trustee, he/she/it should not seek to take up the rights referred to in the PAL or transfer the PAL (or apply for any excess Rights Shares under the EAF) or transfer the nil paid rights in CCASS unless the Company, in its absolute discretion, determines that such actions would not violate applicable legal or regulatory requirements. Any person (including, without limitation, agents, custodians, nominees and trustees) who forwards this Prospectus and/or a PAL and/or an EAF in, into or from, any jurisdiction outside Hong Kong (whether under a contractual or legal obligation or otherwise) should draw the recipient’s attention to the contents of this section.

It is the responsibility of anyone wishing to make an application for the Rights Shares to satisfy himself/herself/itself as to the observance of the laws and regulations of the relevant territory or jurisdiction, including the obtaining of any government or other consents, and to pay any taxes and duties required to be paid in such territory or jurisdiction in connection therewith. Any acceptance of the offer of the Rights Shares by any person will be deemed to constitute a representation and warranty from such person to the Company that these local laws and requirements have been fully complied with. For the avoidance of doubt, neither HKSCC nor HKSCC Nominees Limited is subject to any of the representations and warranties. If you are in doubt as to your position, you should consult your own professional advisers. The Company reserves the right to treat as invalid any acceptances of or applications for, or purported acceptances of or applications for, the Rights Shares where it believes that such acceptance or application, or purported acceptance or application, would violate the applicable securities or other laws or regulations of any territory or jurisdiction or if in respect thereof the Shareholder or its agent has not given the declaration set out in the PAL and/or EAF in respect of such matters.

Procedures for Acceptance and Payment or Transfer

General

Any person (including, without limitation, agents, custodians, nominees and trustees) wishing to take up his/her/its rights under the Rights Issue must satisfy himself/herself/itself as to full observance of the applicable laws of any relevant territory including obtaining any requisite governmental or other consents, observing any other requisite formalities and paying any issue, transfer or other taxes due in such territories. The attention of Shareholders with registered addresses in, and Beneficial Owners or

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LETTER FROM THE BOARD

persons who are located or residing in, any of the jurisdictions outside Hong Kong or who hold Shares on behalf of persons with such addresses or residence is drawn to the sections above headed “Non-Qualifying Shareholders”.

The Company may treat as invalid any instruction which appears to the Company to have been despatched from any of the jurisdictions outside Hong Kong and which may involve a breach of the laws of the relevant jurisdictions or any instruction which otherwise appears to the Company that may involve a breach of the laws of any jurisdiction; or if the Company or its agent(s) believe(s) the same may violate any applicable legal or regulatory requirement; or which purports to exclude the representations and/or warranties required by the paragraph immediately above.

Action to be taken by Qualifying Shareholders

Subscription for all Rights Shares provisionally allotted

For each Qualifying Shareholder, a PAL is enclosed with this Prospectus which entitles the Qualifying Shareholder(s) to whom it is addressed to subscribe for the number of the Rights Shares shown thereon. If a Qualifying Shareholder wishes to take up his/her/its right to subscribe for any or all the Rights Shares provisionally allotted to him/her/it as specified in the PAL, he/she/it must lodge the PAL in accordance with the instructions printed thereon, together with a remittance for the full amount payable on acceptance with the Registrar, by not later than 4:00 p.m. on Thursday, 25 April 2013. All remittances must be made in Hong Kong dollars. Cheques must be drawn on an account with, or cashier’s orders must be issued by, a licensed bank in Hong Kong and made payable to “ Fufeng Group Limited — Rights Issue Account ” and crossed “ Account Payee Only ”. Qualifying Shareholders should note that they may apply for a number of Rights Shares equal to or less than the number set out in the PAL (by following the instructions in the section below headed “Transfer and ‘Splitting’ of Nil Paid Rights”).

It should be noted that unless the PAL, together with the appropriate remittance, has been lodged with the Registrar by 4:00 p.m. on Thursday, 25 April 2013, whether by the original allottee or any person in whose favour the rights have been validly renounced or transferred, that provisional allotment and all rights and entitlements thereunder will be deemed to have been declined and will be cancelled. The Company may, at its discretion, treat a PAL as valid and binding on the person(s) by whom or on whose behalf it is lodged even if not completed in accordance with the relevant instructions.

The PAL contains further information regarding the procedure to be followed for acceptance of the whole or part of the provisional allotment of the Rights Shares by the Qualifying Shareholders.

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LETTER FROM THE BOARD

respect of which the cheque or cashier’s order is dishonoured on first presentation, and in that event the provisional allotment and all rights and entitlements thereunder will be deemed to have been declined and will be cancelled.

The Company reserves the right to refuse to register any transfer in favour of any person in respect of which the Company believes such transfer may violate applicable legal or regulatory requirements. If the conditions of the Rights Issue (as set out in the paragraph headed “Conditions of the Rights Issue” in this “Letter from the Board”) are not fulfilled, the monies received in respect of acceptances of the Rights Shares will be refunded to the Qualifying Shareholders (or such other persons to whom the nil paid rights have been validly transferred) without interest, by means of cheques to be despatched by ordinary post to their registered addresses, and in the case of joint applicants to the registered address of the firstmentioned person who appears on the register of members or the transfer form, at their own risk on or around Thursday, 2 May 2013.

Transfer and “Splitting” of Nil Paid Rights

The nil paid rights can be traded on the Stock Exchange. A Qualifying Shareholder can accept all of his/her/its provisional allotment of Rights Shares, or sell all of his/her/its provisional allotment on the Stock Exchange or accept only part of his/her/its provisional allotment and sell the remaining part on the Stock Exchange.

If a Qualifying Shareholder wishes to accept only part of his/her/its provisional allotment or transfer part of his/her/its rights to subscribe for the Rights Shares provisionally allotted to him/her/it under the PAL or to transfer all or part of his/her/its rights to more than one person, the original PAL must be surrendered and lodged for cancellation not later than 4:30 p.m. on Wednesday, 17 April 2013 with the Registrar, who will cancel the original PAL and issue new PALs in the denominations required which will be available for collection at the Registrar after 9:00 a.m. on the second Business Day after the surrender of the original PAL. This process is commonly known as “splitting” of the nil paid rights.

Having “split” the nil paid rights, a Qualifying Shareholder who wishes to accept the provisional allotment of Rights Shares represented by a new PAL should do so in accordance with the instructions given above in relation to the subscription for the Rights Shares provisionally allotted.

If a Qualifying Shareholder wishes to transfer all of his/her/its nil paid rights under a PAL (or a split PAL, as the case may be) to another person, he/she/it should complete and sign the registration information in the PAL and hand the PAL to the person to or through whom he/she/it is transferring his/her/its Nil Paid Rights. The transferee must then complete and sign the registration details in the PAL and lodge the PAL intact, together with a remittance for the full amount payable on acceptance with the Registrar by not later than 4:00 p.m. on Thursday, 25 April 2013.

The PAL contains further information regarding the procedures to be followed for transfer of the whole or part of the provisional allotment of the Rights Shares by the Qualifying Shareholders.

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LETTER FROM THE BOARD

Action to be taken by Beneficial Owners whose Shares are held by a Registered Shareholder (other than through CCASS)

If you are a Beneficial Owner whose Shares are registered in the name of a Registered Shareholder and you wish to subscribe for the Rights Shares provisionally allotted to such Registered Shareholder in respect of your Shares, or sell the respective nil paid rights or “split” those nil paid rights and accept part of the provisional allotment and sell the remaining part, you should contact the Registered Shareholder and provide the Registered Shareholder with instructions or make arrangements with the Registered Shareholder in relation to the acceptance, transfer and/or “splitting” of the nil paid rights.

Action to be taken by Beneficial Owners holding interests in Shares through CCASS

If you are a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, and you wish to subscribe for the Rights Shares provisionally allotted to HKSCC Nominees Limited in respect of your Shares, or sell the respective nil paid rights or “split” those nil paid rights and accept part of the provisional allotment and sell the remaining part, you should (unless you are a CCASS participant) contact your intermediary and provide your intermediary with instructions or make arrangements with your Intermediary in relation to the acceptance, transfer and/or “splitting” of the nil paid rights.

Such instructions and/or arrangements should be given or made in advance of the relevant dates stated in the section headed “Expected Timetable” of this Prospectus and otherwise in accordance with the requirements of your intermediary in order to allow your intermediary sufficient time to ensure that your instructions are given effect. The procedure for acceptance, transfer and/or “splitting” by CCASS participants of the Rights Shares provisionally allotted to CCASS stock accounts in respect of the Shares registered in the name of HKSCC Nominees Limited shall be in accordance with the “General Rules of CCASS”, the “CCASS Operational Procedures” and any other requirements of CCASS.

Beneficial Owners who are CCASS participants should contact CCASS and provide CCASS with instructions or make arrangements with CCASS in relation to the manner in which such Beneficial Owners’ interests in nil paid rights should be dealt with.

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LETTER FROM THE BOARD

Effect of bad weather on latest time for acceptance of and payment for Rights Shares and application for excess Rights Shares

The latest time for acceptance of and payment for the Rights Shares and for application and payment of excess Right Shares will not take place at the time stated above if there is a tropical cyclone warning signal no. 8 or above, or a “black” rainstorm warning:

(i) in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on Thursday, 25 April 2013. In such event, the latest time for acceptance of and payment for the Rights Shares and for application and payment of excess Right Shares will be extended to 5:00 p.m. on the same Business Day;
(ii) in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on Thursday, 25 April 2013. In such event, the latest time of acceptance of and payment for the Rights Shares will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force at any time between 9:00 a.m. and 4:00 p.m.

If the latest time for acceptance of and payment for the Rights Shares and for application and payment for excess Rights Shares does not take place on Thursday, 25 April 2013, the dates mentioned in the section headed “Expected timetable” above may be affected. The Company will notify the Shareholders by way of announcements on any change to the expected timetable as soon as practicable.

Application for Excess Rights Shares

Qualifying Shareholders shall be entitled to apply, by way of excess applications, for any unsold Rights Shares by aggregating fractions of Rights Shares and any Rights Shares provisionally allotted but not accepted by the Qualifying Shareholders.

Action to be taken by Qualifying Shareholders who wish to apply for excess Rights Shares

Applications for excess Rights Shares may be made by completing the EAFs and lodging the same with a separate remittance for the excess Rights Shares being applied for. The Directors will, after consultation with the Joint Underwriters, allocate the excess Rights Shares at their discretion on a fair and equitable basis as far as practicable on the following principles:

(i) preference will be given to those applications which will top-up odd lots to whole board lots, unless the total number of Rights Shares available for allocation are not sufficient to top-up all odd lots into whole board lots or the Director considers that such applications are made with the intention to abuse such mechanism;
(ii) in case the Rights Shares available for allocation are insufficient to be allotted to all Qualifying Shareholders under principle (i) above, the Directors shall

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LETTER FROM THE BOARD

then allot the excess Rights Shares to the applications on a pro rata basis by reference to the number of excess Rights Shares they have applied for, notwithstanding whether such Qualifying Shareholders are holding odd lots of Shares or board lots of Shares; and

(iii) in case the Rights Shares available for allocation are sufficient to be allotted to those Qualifying Shareholders under principle (i) above, the remaining excess Rights Shares will be allocated to other Qualifying Shareholders who have applied for excess Rights Shares on a pro rata basis by reference to the number of remaining excess Rights Shares they have applied for, with flexibility to round up to whole board lots at the discretion of the Directors.

Investors with their Shares held by a nominee (or which are held in CCASS) should note that the Directors will regard the nominee (including HKSCC) as a single Shareholder according to the register of members of the Company. Accordingly, investors whose Shares are registered in the name of a nominee (or which are held in CCASS) should note that the aforesaid arrangement in relation to the topping-up of odd lots for allocation of excess Rights Shares will not be extended to them individually.

All remittances must be made in Hong Kong dollars and cheques or cashier’s orders must be drawn on a bank account in Hong Kong and made payable to “ Fufeng Group Limited — Excess Application Account ” and crossed “ Account Payee Only ”.

Notwithstanding the provisions in the Prospectus Documents, the Company reserves the right to permit any Shareholder (whether as a direct holder or beneficial owner) whose registered address is in, or who is otherwise resident in, a jurisdiction other than Hong Kong to take up excess Rights Shares if the Company, in its absolute discretion, is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations in that jurisdiction which would otherwise give rise to restrictions upon the offer or take-up of Rights Shares in that jurisdiction.

All cheques or cashier’s orders will be presented for payment immediately upon receipt and all interest earned on such monies will be retained for the benefit of the Company. Completion and lodgment of an EAF together with a cheque or cashier’s order in payment for the excess Rights Shares applied for will constitute a warranty by the applicant that the cheque or cashier’s order will be honoured on first presentation. Without prejudice to its other rights in respect thereof, the Company reserves the right to reject any EAF in respect of which the cheque or cashier’s order is dishonoured on first presentation. An EAF is for use only by the person(s) to whom it is addressed and is not transferable. All documents, including cheques or cashier’s orders for amounts due, will be sent at the risk of the persons entitled thereto to their registered addresses by the Registrar. The Company may, at its discretion, treat an EAF as valid and binding on the person(s) by whom or on whose behalf it is lodged even if not completed in accordance with the relevant instructions.

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LETTER FROM THE BOARD

If no excess Rights Shares are allotted and issued to a Qualifying Shareholder, the amount tendered on application is expected to be refunded to that Qualifying Shareholder in full without any interest by means of cheque(s) despatched by ordinary post and at the risk of such Shareholder on or around Thursday, 2 May 2013. If the number of excess Rights Shares allotted and issued to a Qualifying Shareholder is less than that applied for, the surplus application monies are also expected to be refunded to such Shareholder without any interest by means of cheque(s) despatched by ordinary post and at the risk of such Shareholder on or around Thursday, 2 May 2013.

If the conditions of the Rights Issue (as set out in the paragraph headed “Conditions of the Rights Issue” in this “Letter from the Board”) are not fulfilled, the monies received in respect of relevant applications for excess Rights Shares will be returned to the relevant persons without interest, by means of cheques to be despatched by ordinary post to their registered address, and in the case of joint applicants to the registered address of the firstmentioned person who appears on the register of members, at their own risk on or around Thursday, 2 May 2013.

Action to be taken by Beneficial Owners whose Shares are held by a Registered Shareholder (other than Shares deposited in CCASS) who wish to apply for excess Rights Shares

If you are a Beneficial Owner whose Shares are registered in the name of a Registered Shareholder and you wish to apply for excess Rights Shares, you should contact the Registered Shareholder and provide the Registered Shareholder with instructions or make arrangements with the Registered Shareholder in relation to such application. Such instructions and/or arrangements should be given or made in advance of the latest time for application and payment for excess Rights Shares stated in the section headed “Expected Timetable” of this Prospectus and otherwise in accordance with the requirements of the Registered Shareholder, in order to allow the Registered Shareholder sufficient time to ensure that your instructions are given effect.

Action to be taken by Beneficial Owners holding interests in Shares through CCASS who wish to apply for excess Rights Shares

If you are a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, and you wish to apply for excess Rights Shares, you should (unless you are a CCASS participant) contact your intermediary and provide your intermediary with instructions or make arrangements with your intermediary in relation to this application for excess Rights Shares. Such instructions and/or arrangements should be given or made in advance of the date stated in the section headed “Expected Timetable” of this Prospectus as the latest time for application and payment for excess Rights Shares and otherwise in accordance with the requirements of your intermediary, in order to allow your intermediary sufficient time to ensure that your instructions are given effect.

The procedures for application for excess Rights Shares by CCASS participants shall be in accordance with the “General Rules of CCASS”, the “CCASS Operational Procedures” and any other requirements of CCASS.

Beneficial Owners who are CCASS participants should contact CCASS and provide CCASS with instructions or make arrangements with CCASS in relation to any

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applications for excess Rights Shares. HKSCC Nominees Limited will allocate the excess Rights Shares it receives to the relevant CCASS participants pro rata to the number of excess Rights Shares each has applied for, or in such other manner as HKSCC Nominees Limited considers fair and appropriate, which is pursuant to the allocation basis stipulated in Rule 8.10.4(ix) of the CCASS Operational Procedures.

Certificates for Rights Shares and refund cheques for the Rights Issue

Subject to the fulfillment of the conditions of the Rights Issue set out below, certificates for all fully-paid Rights Shares are expected to be posted to those entitled thereto by ordinary post at their own risk on or around Thursday, 2 May 2013. Applicant(s) will receive one Share certificate for all the Rights Shares allotted and issued to him/her/it.

Refund cheques in respect of wholly or partially unsuccessful applications for excess Rights Shares (if any) are expected to be posted on or around Thursday, 2 May 2013 by ordinary post to the applicants at their own risk.

The first day of dealings in the Rights Shares in their fully-paid form is expected to commence on Friday, 3 May 2013.

Application for listing and dealing

The Company has applied to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms. Nil-paid Rights Shares are expected to be traded in board lots of 1,000 (as the Shares are currently traded on the Stock Exchange in board lots of 1,000).

No part of the share capital of the Company is listed or dealt in or on which listing or permission to deal in is being or is proposed to be sought on any other stock exchange.

Rights Shares will be eligible for admission into CCASS

Subject to the granting of the listing of, and permission to deal in, the Rights Shares in both nil-paid and fully-paid forms on the Stock Exchange as well as compliance with the stock admission requirements of HKSCC, the Rights Shares in both their nil-paid and fully-paid forms will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement dates of dealings in the Rights Shares in both nil-paid and fully-paid forms on the Stock Exchange or such other date as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. All activities under CCASS are subject to the general rules of CCASS and CCASS operational procedures in effect from time to time. Shareholders should seek advice from their stockbroker or other professional adviser for details of those settlement arrangements and how such arrangements will affect their rights and interests.

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LETTER FROM THE BOARD

Stamp duty and other applicable fees and charges

Dealings in the Rights Shares in both their nil-paid and fully-paid forms will be subject to the payment of stamp duty, Stock Exchange trading fee, SFC transaction levy and any other applicable fees and charges in Hong Kong.

UNDERTAKINGS

Irrevocable undertaking from Controlling Shareholder

As at the Latest Practicable Date, BVI Controlling Shareholder is interested in 802,781,000 Shares, representing approximately 46.1% of the existing issued share capital of the Company and is a Controlling Shareholder.

BVI Controlling Shareholder irrevocably undertakes to the Company and the Joint Underwriters as follows:

(i) to subscribe the Rights Shares which will constitute the provisional allotment of Rights Shares in respect of the Shares held by BVI Controlling Shareholder as at the Record Date pursuant to the terms of the Rights Issue;
(ii) that BVI Controlling Shareholder will not dispose of the Shares held by it from the date thereof to the close of business on the Record Date (or such date as may be notified by the Company in writing); and
(iii) to lodge acceptances in respect of the aforesaid Rights Shares with the Registrar or the Company, with payment in full therefor in cash (whether by cheque, bank cashier’s order or such other form as the Company may approve), by no later than 4:00 p.m. on the latest date for acceptance of the Rights Shares as specified by the Company or such later date as the Company may agree.

Irrevocable Undertaking from BVI 1, BVI 2, BVI 3, BVI 4 and Mr. Wang

As at the Latest Practicable Date, BVI 1 is interested in 185,112,000 Shares representing approximately 10.6% of the existing issued share capital of the Company.

As at the Latest Practicable Date, BVI 2 is interested in 51,456,000 Shares, representing approximately 3.0 % of the existing issued share capital of the Company.

As at the Latest Practicable Date, BVI 3 is interested in 57,600,000 Shares, representing approximately 3.3% of the existing issued share capital of the Company.

As at the Latest Practicable Date, BVI 4 is interested in 57,600,000 Shares, representing approximately 3.3% of the existing issued share capital of the Company.

As at the Latest Practicable Date, Mr. Wang is interested in 6,910,000 Shares, representing approximately 0.4% of the existing issued share capital of the Company.

– 24 –

LETTER FROM THE BOARD

Each of BVI 1, BVI 2, BVI 3, BVI 4 and Mr. Wang severally and irrevocably undertake to the Company and the Joint Underwriters as follows:

(i) to subscribe the Rights Shares which will constitute the provisional allotment of Rights Shares in respect of the Shares held by BVI 1, BVI 2, BVI 3, BVI 4 and Mr. Wang, respectively, as at the Record Date pursuant to the terms of the Rights Issue;
(ii) that each of them will not dispose of the respective Shares held by them from the date thereof to the close of business on the Record Date (or such date as may be notified by the Company in writing); and
(iii) to lodge acceptances in respect of the aforesaid Rights Shares with the Registrar or the Company, with payment in full therefor in cash (whether by cheque, bank cashier’s order or such other form as the Company may approve), by no later than 4:00 p.m. on the latest date for acceptance of the Rights Shares as specified by the Company or such later date as the Company may agree.

UNDERWRITING ARRANGEMENTS

Principal terms of the Underwriting Agreement

Date : 25 March 2013 (after trading hours on the Stock Exchange)

Joint Underwriters

: China Galaxy International Securities (Hong Kong) Co., Limited

CCB International Capital Limited; and

GuocoCapital Limited

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, the Joint Underwriters and their ultimate beneficial owners are Independent Third Parties

Number of Underwritten : 115,917,800 Rights Shares, with an aggregate nominal Rights Shares value of HK$11,591,780
Commission
: 2.5% of the Rights Issue subscription proceeds in respect of the Underwritten Rights Shares
Other fees and expenses
: All reasonable legal fees and other reasonable out-of-pocket expenses of the Joint Underwriters in respect of the Rights Issue

– 25 –

LETTER FROM THE BOARD

The commission rate was determined after arm’s length negotiations between the Company and the Joint Underwriters by reference to the existing financial position of the Company, the size of the Rights Issue and the current and expected market condition. The Directors consider that the terms of the Underwriting Agreement including the commission rate are (i) on normal commercial terms; and (ii) fair and reasonable as far as the Company and the Shareholders are concerned.

CONDITIONS OF THE RIGHTS ISSUE

The Rights Issue is conditional upon the Underwriting Agreement becoming unconditional and not being terminated. The obligations of the Joint Underwriters under the Underwriting Agreement are conditional upon:

(i) the delivery to the Stock Exchange and registration by the Registrar of Companies respectively on or prior to the Posting Date of one copy of each of the Rights Issue Documents each duly certified in compliance with section 342C of the Companies Ordinance (and all other documents required to be attached thereto) and otherwise complying with the requirements of the Companies Ordinance and the Listing Rules;
(ii) the posting on the Posting Date of copies of the Rights Issue Documents to the Qualifying Shareholders;
(iii) compliance by the Company with all its obligations under the Underwriting Agreement;
(iv) the Listing Committee of the Stock Exchange granting listing of, and permission to deal in, the Rights Shares in their nil-paid and fully-paid forms either unconditionally or subject to such conditions which the Company (with the approval of the Joint Underwriters) accepts and the satisfaction of such conditions (if any and where relevant) by no later than the Posting Date and the Listing Committee of the Stock Exchange not having withdrawn or revoked such listings and permission on or before 4:00 p.m. on the Settlement Date;

– 26 –

LETTER FROM THE BOARD

(v) (a) the Shares remaining listed on the Stock Exchange at all times prior to the Settlement Date and the current listing of the Shares not having been withdrawn or the trading of the Shares not having been suspended for a consecutive period of more than 3 trading days and (b) no indication being received before 4:00 p.m. on the Settlement Date from the Stock Exchange to the effect that such listing may be withdrawn or objected to (or conditions will or may be attached thereto) including but not limited to as a result of the Rights Issue or in connection with the terms of the Underwriting Agreement or for any other reason; and
(vi) the obligations of the Joint Underwriters under the Underwriting Agreement not being terminated by the Joint Underwriters in accordance with the terms thereof.

The Joint Underwriters have the sole discretion to waive the above conditions other than conditions (i), (ii), (iii), (iv) and (v)(b). In the event that conditions in (i), (ii) and (iii) have not been satisfied on or before the Posting Date (or the relevant dates set out therein) or in the event that conditions (iv) and (v)(b) set out above have not been satisfied on or before 4:00 p.m. on the Settlement Date, all liabilities of the parties to the Underwriting Agreement shall cease and determine and none of the parties shall have any claim against the other (save in respect of any antecedent breaches and claims) save that all such costs, fees (including legal fees) and other out-of-pocket expenses (including, but not limited to, sub-underwriting fees and related expenses) as have been incurred by each of the Joint Underwriters in connection with the underwriting of the Underwritten Rights Shares by the Joint Underwriters shall be borne by the Company.

The Company shall use its best endeavours to procure the fulfillment of the conditions (i) to (vi) set out above and shall do all the things required to be done by it pursuant to the Rights Issue Documents or otherwise necessary to give effect to the Rights Issue and the arrangements contemplated by the Underwriting Agreement.

– 27 –

LETTER FROM THE BOARD

POSSIBLE CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY ARISING FROM THE RIGHTS ISSUE

Assuming that there will be no change in the issued share capital of the Company and the shareholding structure of the Company from the Latest Practicable Date until the completion of the Rights Issue, the shareholdings in the Company as at the Latest Practicable Date and immediately after the completion of the Rights Issue were and will be as follows:

BVI Controlling Shareholder BVI 1 BVI 2 BVI 3 BVI 4 Mr. Wang Joint Underwriters(2) Other public Shareholders Total	Existing shareholding as at the the Latest Practicable Date(1) Shares Approximate % 802,781,000 46.1% 185,112,000 10.6% 51,456,000 3.0% 57,600,000 3.3% 57,600,000 3.3% 6,910,000 0.4% – – 579,589,000 33.3% 1,741,048,000 100%	Immediately upon completion of the Rights Issue (assuming all Rights Shares will be taken up by the Qualifying Shareholders) Shares Approximate % 963,337,200 46.1% 222,134,400 10.6% 61,747,200 3.0% 69,120,000 3.3% 69,120,000 3.3% 8,292,000 0.4% – – 695,506,800 33.3% 2,089,257,600 100%	Immediately upon completion of the Rights Issue (assuming no Rights Shares will be taken up by the Qualifying Shareholders except for those who have undertaken to subscribe pursuant to the Irrevocable Undertakings) Shares Approximate % 963,337,200 46.1% 222,134,400 10.6% 61,747,200 3.0% 69,120,000 3.3% 69,120,000 3.3% 8,292,000 0.4% 115,917,800 5.6% 579,589,000 27.7% 2,089,257,600 100%	Immediately upon completion of the Rights Issue (assuming no Rights Shares will be taken up by the Qualifying Shareholders except for those who have undertaken to subscribe pursuant to the Irrevocable Undertakings) Shares Approximate % 963,337,200 46.1% 222,134,400 10.6% 61,747,200 3.0% 69,120,000 3.3% 69,120,000 3.3% 8,292,000 0.4% 115,917,800 5.6% 579,589,000 27.7% 2,089,257,600 100%
				100%

Notes:

(1) Based on the information in the disclosure of interests register which is required to be kept by the Company under S336 of the SFO and the Shares held by parties as confirmed by the Irrevocable Undertakings.
(2) Pursuant to the Joint Underwriters’ underwriting obligations under the Underwriting Agreement.

Figures shown as totals may not be an arithmetic aggregation of the figures preceding them, and the approximate percentages may not add up to 100% due to rounding.

– 28 –

LETTER FROM THE BOARD

REASONS FOR AND BENEFITS OF THE RIGHTS ISSUE AND USE OF PROCEEDS

The Group is principally engaged in the manufacture and sale of biochemical products such as monosodium glutamate (“MSG”) and Xanthan gum. In recent years, the industry has undergone major restructuring and consolidation where the number of MSG enterprises in the PRC decreased significantly. During this period, the Group had actively and strategically increased capital expenditure to increase its production capacity whilst maintaining competitive pricing in order to capture more market share and increase its market leading position. The Group believes that consolidation in the domestic MSG industry is nearing its end and weaker competitors with lesser competitive advantages have been largely eliminated. The next stage of competition in the industry would be mainly between larger and fundamentally stronger enterprises and the Group expects that industry supply and demand will gradually return to normal. With the benefit of increased level of investment made in recent years, the Group is confident that it is well positioned to further increase its market share in its key markets going forward. The Directors consider that taking into account the prevailing market conditions, it would be in the best interests of the Company and the Shareholders as a whole to raise long-term equity funding for replacement of Company’s existing borrowings and debts and general working capital purposes.

Having considered other fund raising alternatives for the Group, including issuance of debt securities and share placements and taking into account the benefits and costs of each alternative, the Directors consider that the Rights Issue is the preferred means for the Group to raise long-term funds without subjecting itself to interest burden or additional debt. The Rights Issue also offers existing Shareholders the opportunity to participate without dilution. The Directors consider that the net proceeds of the Rights Issue will also strengthen the Company’s capital base and strengthen the Group’s financial position, while at the same time the Rights Issue will enable Shareholders to participate in the future development of the Company on equal terms.

It is intended that the estimated net proceeds, after deduction of related expenses, of approximately HK$617 million from the Rights Issue, of which approximately 90% will be used for repayment of existing loan facilities or borrowings of the Group and approximately 10% for general working capital purpose. The estimated expenses in relation to the Rights Issue, including underwriting commission, financial, legal and other professional advisory fees, printing and translation expenses, of approximately HK$9.5 million, will be borne by the Company. After taking into account the estimated expenses in relation to the Rights Issue, the net price per Rights Share is expected to be approximately HK$1.77.

Based on the aforesaid and taking into account that the Rights Issue will give the Qualifying Shareholders the opportunity to maintain their respective pro rata shareholding interests in the Company and to continue to participate in the future development of the Group, the Board considers that fund raising through the Rights Issue is in the interests of the Company and the Shareholders as a whole.

– 29 –

LETTER FROM THE BOARD

FUND RAISING BY THE COMPANY IN THE PAST TWELVE MONTHS

Save for the Rights Issue, the Company has not conducted any fund raising exercises in connection with any issue of equity securities in the past 12 months immediately preceding the Latest Practicable Date.

ADJUSTMENTS IN RELATION TO THE EXERCISE PRICE AND/OR NUMBER OF SHARE OPTIONS

The Company has granted Share Options to certain Directors and eligible employees to subscribe for an aggregate of 64,110,000 Shares and 5,000,000 Shares on 14 July 2009 and 9 November 2010 respectively under the Share Option Scheme. As at the Latest Practicable Date, the Company had 50,270,000 outstanding Share Options, of which 29,878,200 Shares are vested and exercisable on or prior to the Record Date.

The Rights Issue, if it becomes unconditional, will cause adjustments to the subscription price and/or the number of Shares to be issued under the Share Option Scheme (both vested and unvested) under the terms thereof. Adjustments to certain terms of the Share Options shall be made pursuant to the Share Option Schemes and in compliance with Rule 17.03(13) of the Listing Rules. Independent financial adviser or auditor will be engaged by the Company to confirm to the Directors in writing that such adjustments satisfy the requirements under Rule 17.03(13) of the Listing Rules. The Company will inform holders of the Share Options of such adjustments accordingly by written notice to each of them.

ADJUSTMENTS TO THE CONVERTIBLE BONDS

By a resolution of the Shareholders passed at the annual general meeting held on 28 April 2009, the Company granted a general mandate to the Directors to allot and issue up to 20% of the issued share capital of the Company, being 332,000,000 Shares. Under the Convertible Bonds, a total of 165,742,524 new Shares could be allotted and issued and the Company would use the general mandate granted on 28 April 2009 to issue any new Shares.

As a result of the Rights Issue, the conversion price of the Convertible Bonds will be adjusted in accordance with the respective terms and conditions of the Convertible Bonds. The Company will inform the holders of the Convertible Bonds of the adjustment accordingly. The adjusted conversion price would decrease to HK$6.56, from the initial conversion price of HK$7.03, as a result of the Rights Issue.

Upon previous repurchase and redemption of certain amount of the Convertible Bonds, the principal amount of the outstanding Convertible Bonds at the Latest Practicable Date is RMB14,200,000. Given that the Outstanding Convertible Bonds could only be converted into 2,296,140 Shares at the initial conversion price of HK$7.03 or 2,460,650 Shares at the adjusted conversion price of HK$6.56, the Directors confirmed that the abovementioned general mandate granted is sufficient to cover the potential new Shares to be issued upon conversion of the Outstanding Convertible Bonds after adjustment to conversion price.

– 30 –

LETTER FROM THE BOARD

TAXATION

Qualifying Shareholders are recommended to consult their professional advisers if they are in doubt as to the taxation implications of holding or disposals of, or dealing in, the Rights Shares, and similarly, the Non-Qualifying Shareholders (if any) as regards their receipt of the net proceeds of sale of the Rights Shares otherwise falling to be issued to them under the Rights Issue. It is emphasized that none of the Company, the Directors or any other parties involved in the Rights Issue accept responsibility for any tax effects or liability of holders of the Rights Shares resulting from the purchase, holding or disposal of, or dealing in, the Rights Shares.

LISTING RULES IMPLICATIONS

Pursuant to Rule 7.19(6)(a) of the Listing Rules, since the Rights Shares will not increase the issued share capital or the market capitalization of the Company by more than 50% within the twelve month’s period immediately preceding the date of this announcement, the Rights Issue is not subject to any Shareholders’ approval.

FINANCIAL AND TRADING PROSPECTS OF THE GROUP

Since the second half of 2011, while implementing its long term development strategy confronted with unfavorable factors, the Group also had to actively strengthen its cost advantages in order to address major challenges including, among others, industry consolidation, PRC domestic macro-control measures and the European debt crisis. As a result, the financial performance of the Group has been negatively affected since 2011. Despite such challenges, the Group was able to increase its market share primarily by expanding production capacity, strengthening research and development capabilities, and further expanding product range. As at 31 December 2012, despite that the Group’s current liabilities exceeds its current assets, the Directors believe that the Group’s liquidity position is still relatively stable. The Company has sufficient banking facilities to repay or roll over existing short term bank loans. In addition, the net proceeds of the Rights Issue are intended to be used primarily for, among others, the repayment of existing loan facilities or borrowings of the Group.

Looking ahead to 2013, the domestic economy of the PRC is expected to continue its steady growth, and as the overall living standards continue to improve, the Group expects that the food and beverage industry will achieve a certain degree of growth. The Group’s main products, such as MSG and xanthan gum, are common raw materials and additives products used in the preparation of food and beverages, and therefore the Group expects demand of its products to grow as well. The Group will continue to leverage its cost advantage to further expand its market share. Average Selling Price (“ASP”) of MSG has being negatively affected by the ongoing industry consolidation since 2011, and the Group expects that ASP of MSG will remain at a relatively low level in the first quarter of 2013 as the industry consolidation is at its tail end. Based on the Group’s current assessment of the operating environment, the Group expects the ASP of MSG to be stabilised or gradually improve in the second quarter of 2013.

– 31 –

LETTER FROM THE BOARD

As for xanthan gum, the global market demand for xanthan gum continued to increase in 2012 and the Group registered increases in both sales volume and ASP for its xanthan gum products. The Group expects market demand for xanthan gum and pricing power to remain strong in 2013 and the Group will continue to invest in the development of the xanthan gum business, and to further expand its sales network in order to increase market share.

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information contained in the Appendices to this Prospectus.

Yours faithfully, By Order of the Board Fufeng Group Limited Li Xuechun Chairman

– 32 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

1. FINANCIAL SUMMARY OF THE GROUP

The financial information of the Group (i) for the year ended 31 December 2012 is disclosed on pages 47 to 120 of the annual report of the Company for the year ended 31 December 2012 published on 11 April 2013; (ii) for the year ended 31 December 2011 is disclosed on pages 43 to 114 of the annual report of the Company for the year ended 31 December 2011 published on 28 March 2012; and (iii) for the year ended 31 December 2010 is disclosed on pages 49 to 118 of the annual report of the Company for the year ended 31 December 2010 published on 23 March 2011.

All these financial statements have been published on the website of the Stock Exchange (www.hkexnews.hk) and the website of the Company (www.fufeng-group.com).

2. STATEMENT OF INDEBTEDNESS

As at the close of business on 28 February 2013, being the latest practicable date for the purpose of this indebtedness statement prior to printing of this Prospectus, the Group had the following outstanding indebtedness:

RMB

Long Term Borrowings – Senior notes (c) – Bank borrowings, secured (a) Short Term Borrowings – Convertible bonds (b) – Bank borrowings, secured (a) – Bank borrowings, unsecured (a) Total Borrowings	1,855,462,634 188,337,000
	2,043,799,634
	177,325,182 94,500,000 2,535,953,142
	2,807,778,324
	4,851,577,958

Notes:

(a) As at 28 February 2013, the bank borrowings included: (i) RMB94,500,000 secured by leasehold land; (ii) RMB188,337,000 guaranteed by a standby letter of credit for RMB200,000,000 issued by China Merchants Bank Shenzhen Wenjindu Sub-branch and secured by the pledge of the Group’s restricted bank deposits of RMB40,000,000.

Reclassification of syndicated bank loan

In November 2012, the Company obtained a syndicated bank loan facility of USD150,000,000 with a floating interest rate of 3-month USD LIBOR plus 4% per annum to support its redemption of

– 33 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

the outstanding convertible bonds. The loan facility has a three year term. The Company will repay the loan on a semi-annual instalment basis from November 2013. On 29 November 2012, a loan of USD129,321,000 was drawn down under the facility and the value of the liability, taking into account of the transaction cost of USD8,591,000, was determined at the initial recognition.

On 17 January 2013, the Group and Deutsche Bank AG, London Branch entered into a floating-to-fixed interest rate swap contract, which will expire in May 2015, to hedge the interest rate risk of the syndicated bank loan and fix the interest rate at 4.5% p.a.. The notional principal amount of the outstanding interest rate swap contract at 28 February 2013 was USD130,000,000.

As at 28 February 2013, the balance of approximately RMB684,857,828 of the syndicated bank loan, which had been recorded as non-current liabilities prior to 31 December 2012, was reclassified to current liability because the Group exceeded the maximum amount of capital expenditure for the year ended 31 December 2012 as set out in one of the loan covenants in the loan agreement.

On 15 March 2013, the Group obtained a one-off waiver from a majority of the lenders of the syndicated bank loan and accordingly the above-mentioned loan of RMB684,857,828 is no longer considered as repayable on demand.

(b) The Company issued convertible bonds with a total par value of RMB1,025,000,000 in April 2010 at a fixed interest rate of 4.5%. The bonds mature in five years from the issue date at their nominal value of RMB1,025,000,000 or can be converted into the Company’s ordinary shares at the holder’s option at the rate of HKD7.03 per share. The values of the liability component and the equity conversion component, net off transaction costs of RMB25,679,000, were determined upon issuance of the bonds.

The liability component of the convertible bonds is recognised initially at the fair value of a similar liability that does not have an equity conversion option. The equity component is recognised initially at the difference between the fair value of the convertible bonds as a whole and the fair value of the liability component, which is included in shareholders’ equity in other reserves. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Subsequent to initial recognition, the liability component of the convertible bonds is measured at amortised cost using the effective interest method. The equity component of the convertible bonds is not re-measured subsequent to initial recognition.

Liability component of the convertible bonds is classified as current unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting period.

The Company redeemed convertible bonds with a par value of RMB843,800,000 in October and November 2012.

As at 28 February 2013, the outstanding principal amount of the convertible bonds is RMB181,200,000. The carrying amount of the liability component of the outstanding convertible bonds is RMB177,325,182. The carrying amount of the equity component of the outstanding convertible bonds is RMB15,017,000. According to the redemption term set out in the convertible bonds offering memorandum, the issuer will, at the option of the holder of any bond, redeem all or some of such holder’s bonds on 1 April 2013. As a result, the outstanding balance of the convertible bonds has been transferred to current liability at 28 February 2013.

(c) In April 2011, the Group issued senior notes with a total par value of USD300,000,000, which were denominated in USD with a fixed interest rate of 7.625%. The notes mature in five years from the issue date and are secured by the pledge of the capital stock of certain subsidiaries of the Company. The guarantors are all intermediate holding companies that collectively control the operation and assets of the PRC subsidiaries of the Group. The values of the liability, taking into account of the transaction costs of USD6,706,000, were determined upon issuance of the notes.

– 34 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

Save as disclosed above and otherwise mentioned herein, and apart from intra-group liabilities, none of the members of the Group had, at the close of business on 28 February 2013, any outstanding mortgages, charges, debenture, loan capital issued and outstanding or agreed to be issued, bank loan and overdraft or other similar indebtedness, finance leases or hire purchase commitments, liabilities under acceptances or acceptance credits or any guarantee or other material contingent liabilities.

3. WORKING CAPITAL STATEMENT

On 28 February 2013 (being the latest practicable date in determining the indebtedness of the Group), the Group had total banking facilities of RMB1,250 million which would be expiring beyond one year, of which RMB110 million has been utilised. The Group intends to issue medium-term notes of RMB600 million in the inter-bank bond market in April 2013. The Group has obtained regulatory approval for and has entered into underwriting agreement with the banks for the issue of the medium-term notes. The Group intends to use the undrawn banking facilities and the proceeds of the medium-term notes to refinance or repay the existing loan facilities that will be maturing over the next 12 months of the date of prospectus.

In determining the sufficiency of the working capital of the Group, the Directors have made the assumption that the new medium-term notes will be duly issued in the next 12 months and the existing loan facilities that will be due for repayment over the next 12 months will be refinanced or otherwise repaid by using the undrawn banking facilities and the proceeds of the medium-term notes.

The Directors are of the opinion that, after due and careful consideration taking into account the financial resources and banking facilities available to the Group and the net proceeds of the proposed Rights Issue and based on the assumptions regarding the financing arrangement as set out above, the Group will have sufficient working capital to satisfy its present requirements for the next twelve months from the date of this Prospectus in the absence of unforeseen circumstances.

– 35 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

The following is an illustrative and unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to the equity holders of the Company which has been prepared on the basis of the notes set out below, for the purpose of illustrating the effect of the Rights Issue as if it had taken place on 31 December 2012. This unaudited pro forma statement of adjusted consolidated net tangible assets has been prepared for illustrative purpose only, and because of its hypothetical nature, it may not give a true picture of the financial position of the Group had the Rights Issue been completed as at 31 December 2012 or at any future date.

			Unaudited pro		Unaudited pro
			forma adjusted		forma adjusted
	Audited		consolidated net		consolidated net
	consolidated net		tangible assets of	Consolidated net	tangible assets per
	tangible assets of		the Group	tangible assets per	Share attributable
	the Group		attributable to the	Share attributable	to the equity
	attributable to the		equity holders of	to the equity	holders of the
	equity holders of	Estimated net	the Company after	holders of the	Company after
	the Company as at	proceeds from the	completion of the	Company as at 31	completion of the
	31 December 2012	Rights Issue	Rights Issue	December 2012	Rights Issue
	RMB’000	RMB’000	RMB’000	RMB	RMB
	(Note I)	(Note 2)		(Note 3)	(Note 4)
Rights Issue of 348,209,600
Rights Shares to be issued at
subscription price of HK$1.80
per Rights Share	3,794,954	489,903	4,284,857	2.18	2.05

Notes:

(1) The consolidated net tangible assets of the Group attributable to the equity holders of the Company as at 31 December 2012 is based on the audited consolidated net assets of the Group attributable to the equity holders of the Company as at 31 December 2012 of RMB3,795,008,000 with adjustments for intangible assets of RMB54,000 as extracted from the published annual report of the Group for the year ended 31 December 2012.
(2) The estimated net proceeds from the Rights Issue are based on 348,209,600 Rights Shares to be issued (in the proportion of one Rights Share for every five Shares held as at the Record Date) at the subscription price of HK$1.80 per Rights Share, after deduction of the related expenses of approximately HK$9,500,000. For the purpose of the estimated net proceeds from the Rights Issue, the translation of Hong Kong dollars into RMB was made at the rate of RMB1 to HK$1.26.

– 36 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

(3) The consolidated net tangible assets per Share attributable to the equity holders of the Company as at 31 December 2012 was RMB2.18, which was based on the audited consolidated net tangible assets of the Group attributable to the equity holders of the Company as at 31 December 2012 of RMB3,794,954,000 and 1,741,048,000 Shares in issue as at 31 December 2012.
(4) The unaudited pro forma adjusted consolidated net tangible assets per Share is arrived at after aggregating the audited consolidated net tangible assets of the Group of RMB3,794,954,000 as at 31 December 2012 (Note 1) and the estimated net proceeds of RMB489,903,000 from the Rights Issue (Note 2) and on the basis that 1,741,048,000 Shares were in issue as at 31 December 2012 and 348,209,600 Rights Shares were issued under the Rights Issue assuming the Rights Issue has been completed on 31 December 2012, but does not take into account of any Shares which may be issued upon the exercise of options granted under the Share Option Scheme or any Shares which may be issued upon the conversion of the Convertible Bonds or any Shares which may be granted and issued or repurchased by the Company pursuant to the general mandate and the repurchase mandate.
(5) No adjustments have been made to the unaudited pro forma adjusted consolidated net tangible assets of the Group to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2012.

– 37 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

B. REPORT FROM REPORTING ACCOUNTANT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

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ACCOUNTANT’S REPORT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION TO THE DIRECTORS OF FUFENG GROUP LIMITED

We report on the unaudited pro forma financial information of Fufeng Group Limited (the “Company”) and its subsidiaries (hereinafter collectively referred to as the “Group”) set out on pages 36 to 37 under the heading of “Unaudited Pro Forma Statement of Adjusted Consolidated Net Tangible Assets of the Group” (the “Unaudited Pro Forma Financial Information”) in Appendix II of the Company’s Prospectus dated 11 April 2013 (the “Prospectus”), in connection with the proposed rights issue of the Company. The Unaudited Pro Forma Financial Information has been prepared by the directors of the Company, for illustrative purposes only, to provide information about how the rights issue might have affected the relevant financial information of the Group. The basis of preparation of the Unaudited Pro Forma Financial Information is set out on pages 36 to 37 of the Prospectus.

Respective Responsibilities of Directors of the Company and the Reporting Accountant

It is the responsibility solely of the directors of the Company to prepare the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and Accounting Guideline 7 “Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars” issued by the Hong Kong Institute of Certified Public Accountants (the “HKICPA”).

It is our responsibility to form an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

– 38 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

Basis of Opinion

We conducted our engagement in accordance with Hong Kong Standard on Investment Circular Reporting Engagements 300 “Accountants’ Reports on Pro Forma Financial Information in Investment Circulars” issued by the HKICPA. Our work, which involved no independent examination of any of the underlying financial information, consisted primarily of comparing the audited consolidated net assets of the Group as at 31 December 2012 with the audited consolidated financial statements of the Company for the year ended 31 December 2012 as set out in the 2012 published annual report of the Company, considering the evidence supporting the adjustments and discussing the Unaudited Pro Forma Financial Information with the directors of the Company.

We planned and performed our work so as to obtain the information and explanations we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the Unaudited Pro Forma Financial Information has been properly compiled by the directors of the Company on the basis stated, that such basis is consistent with the accounting policies of the Group and that the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

The Unaudited Pro Forma Financial Information is for illustrative purposes only, based on the judgements and assumptions of the directors of the Company, and, because of its hypothetical nature, does not provide any assurance or indication that any event will take place in the future and may not be indicative of the adjusted consolidated net tangible assets of the Group as at 31 December 2012 or any future date.

Opinion

In our opinion:

a) the Unaudited Pro Forma Financial Information has been properly compiled by the directors of the Company on the basis stated;
b) such basis is consistent with the accounting policies of the Group; and
c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

PricewaterhouseCoopers

Certified Public Accountants Hong Kong, 11 April 2013

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APPENDIX III

GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

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

The issue of this Prospectus has been approved by the Directors.

2. FURTHER INFORMATION ABOUT THE COMPANY

The Company was incorporated in the Cayman Islands. Its registered office is situated at Cricket Square, Hutchins Drive, P.O. Box 2681 Grand Cayman KY1-1111, Cayman Islands and its place of business in Hong Kong is at Suite 1102, 11th Floor, Chinachem Century Tower, 178 Gloucester Road, Wanchai, Hong Kong.

3. SHARE CAPITAL, CONVERTIBLE BONDS AND SHARE OPTIONS

Share Capital

The authorised and issued share capital of the Company as at the Latest Practicable Date were, and immediately following the Rights Issue will be, as follows:

HK$

Authorised:

10,000,000,000 ordinary shares of HK$0.1 each Issued, to be issued and fully paid or credited as fully paid: 1,741,048,000 Shares are issued as at the Latest Practicable Date 348,209,600 Rights Shares to be issued pursuant to the Rights Issue Total: 2,089,257,600 Shares	1,000,000,000 174,104,800 34,820,960
	208,925,760

All of the Shares currently in issue rank pari passu in all respects with each other, including, in particular, as to dividends, voting rights and capital. The Shares in issue are listed on the Stock Exchange.

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APPENDIX III

GENERAL INFORMATION

All of the Rights Shares to be allotted and issued will, subject to the articles of association of the Company, rank pari passu in all respects with each other, including, in particular, as to dividends, voting and capital, and with all Shares in issue as at the date of allotment and issue of the Rights Shares such that holders of fully-paid Rights Shares will be entitled to receive all future dividends and distributions the record dates of which are on or after the date of allotment of the Rights Shares.

Apart from the Convertible Bonds and the USD$300 million 7.625% senior notes due 2016 both being listed on the Singapore Exchange Securities Trading Limited, no part of the share capital or any other securities of the Company is listed or dealt in on any stock exchange other than the Stock Exchange and no application is being made or is currently proposed or sought for the Shares or Rights Shares or any other securities of the Company to be listed or dealt in on any other stock exchange.

Convertible Bonds

As at the Latest Practicable Date, the Company has Outstanding Convertible Bonds with an aggregate outstanding principal amount of RMB14,200,000 which can be converted into 2,296,140 Shares at an initial conversion price of HK$7.03 per Share (with a fixed exchange rate applicable on conversion of RMB0.8797 to HK$1.00). The adjusted conversion price would decrease to HK$6.56 from the initial conversion price of HK$7.03 and the number of Shares that can be converted at the adjusted conversion price would be 2,460,650, as a result of the Rights Issue.

Share Options

As at the Latest Practicable Date, the Company had outstanding Share Options in respect of an aggregate of 50,270,000 Shares granted under the Share Option Scheme. Details of such Share Options are set out below:

Holder of Share Options Date of grant Mr. Chen Yuan 9/11/2010 Senior management, other employees and consultants of the Group 14/7/2009 Total:	Number of Shares which may be issued upon exercise of the outstanding Shares Options Date of expiry Exercise price (HK$) 5,000,000 9/5/2016 8.20 45,270,000 13/1/2015 3.00 50,270,000

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APPENDIX III

GENERAL INFORMATION

4. CORPORATE INFORMATION AND PARTIES INVOLVED IN THE RIGHTS ISSUE

Registered office Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands Place of business in Suite 1102, 11th Floor Hong Kong Chinachem Century Tower 178 Gloucester Road Wanchai, Hong Kong Authorised representatives Li Xuechun 37 Hualu Street, Junan County Shandong Province PRC Lee Wai Yin Flat E, 24th Floor Golden Dragon Garden 77 Kung Lok Road, Kwun Tong Kowloon, Hong Kong Company secretary Lee Wai Yin, FCCA CPA Joint financial advisers China Galaxy International Securities (Hong Kong) Co., Limited Unit 3501–3507, 35th Floor, Cosco Tower Grand Millennium Plaza 183 Queen’s Road Central Sheung Wan, Hong Kong Citigroup Global Markets Asia Limited 50/F., Citibank Tower, Citibank Plaza 3 Garden Road Central Hong Kong Joint Underwriters China Galaxy International Securities (Hong Kong) Co., Limited Unit 3501–3507, 35th Floor, Cosco Tower Grand Millennium Plaza 183 Queen’s Road Central Sheung Wan, Hong Kong

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APPENDIX III

GENERAL INFORMATION

Legal advisers to the Company

CCB International Capital Limited 34/F., Two Pacific Place 88 Queensway Admiralty, Hong Kong GuocoCapital Limited 12/F., The Center 99 Queen’s Road Central Hong Kong As to Hong Kong law: Li & Partners 22nd Floor, World-Wide House Central Hong Kong

As to Cayman Islands law: Conyers Dill & Pearman (Cayman) Limited Boundary Hall 2nd Floor Cricket Square P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands Legal adviser to the Joint As to Hong Kong law: Underwriters Reed Smith Richards Butler 20th Floor Alexandra House 18 Chater Road Central, Hong Kong Auditors and reporting PricewaterhouseCoopers accountants 22nd Floor Prince’s Building Central Hong Kong

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APPENDIX III

GENERAL INFORMATION

Principal share registrar and Royal Bank of Canada Trust Company transfer office in (Cayman) Limited the Cayman Islands Butterfield House 68 Fort Street P.O. Box 705 Grand Cayman KY1-1107 Cayman Islands Hong Kong Branch Share Tricor Investor Services Limited Registrar and Transfer Office 26th Floor, Tesbury Centre 28 Queen’s Road East Wanchai Hong Kong Principal banks in Hong Kong The Royal Bank of Scotland PLC Floor 30 AIA Central 1 Connaught Road Central Hong Kong Hang Seng Bank Limited 11/F., 83 Des Voeux Road Central Hong Kong Principal banks in the PRC China Construction Bank Junan Sub-branch 26 Renmin Road Junan County Linyi Shandong Province PRC Agricultural Bank of China Junan Sub-branch 89 Minzhu Road Junan County Linyi Shandong Province PRC Bank of China Hohhot Zhongshan Sub-branch 19 East Zhongshan Road Hohhot Inner Mongolia Autonomous Region PRC

– 44 –

APPENDIX III

GENERAL INFORMATION

5. PARTICULARS OF DIRECTORS AND SENIOR MANAGEMENT

Brief biographies of the Directors and the senior management of the Group are set out below:

Li Xuechun

Chairman and Executive Director

Mr. Li, aged 61, is the principal founder of the Group, the chairman of the Company and an executive Director. Mr. Li is also a director of Acquest Honour, Summit Challenge, Absolute Divine, Expand Base, Fufeng Singapore, Shandong Fufeng, Baoji Fufeng and IM Fufeng. Mr. Li is responsible for the strategic planning and formulation of overall corporate development policy of the Group. Mr. Li obtained a bachelor’s degree in industrial fermentation from 山東輕工業學院 (Shandong Institute of Light Industry) in 1982. Mr. Li is 山東省第十二屆人大代表 (a member of the Shandong Province 12th People’s Congress), as well as being honored with “Outstanding Achievement” by the government of Shandong Province in April 2003. In the same year, he was also labeled as “Model Labour” of Shandong Province. Mr. Li first joined 山東福瑞酒廠 (Shandong Furui Brewery Group) in 1982 as the factory manager. Mr. Li established the Group starting by set up Shandong Fufeng in June 1999. He was appointed a director of Shandong Fufeng upon its establishment. He has 31 years of experience in the fermentation industry. Mr. Li is the sole director of and is beneficially interested in the entire issued share capital of Motivator Enterprises Limited which in turn is interested in approximately 46.11% of the issued share capital of the Company and is a controlling shareholder of the Company. He is the father of 李廣玉 (Li Guangyu) (an executive Director) and the brother-in-law of 李德衡 (Li Deheng) (an executive Director).

Wang Longxiang

Executive Director and General Manager

Mr. Wang, aged 51, is an executive Director and the general manager of the Group. Mr. Wang is responsible for the overall management of the Group’s daily operations. Mr. Wang obtained a bachelor’s degree in industrial fermentation from 山東輕工業學院 (Shandong Institute of Light Industry) in 1982. He is qualified as a senior engineer. Mr. Wang also obtained a master ’s degree in business administration from 中國科技大學 (University of Science and Technology of China) in 1992. Mr. Wang joined the Group in 2005 and has over 21 years of experience in the fermentation industry. Mr. Wang is interested in 14.3% of the issued share capital of Hero Elite, which in turn is interested in 57,600,000 Shares, representing 3.31% of the issued share capital of the Company.

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APPENDIX III

GENERAL INFORMATION

Feng Zhenquan

Executive Director and Vice General Manager

Mr. Feng, aged 43, is an executive Director and vice general manager of the Group. Mr. Feng is also a director of Shandong Fufeng, Baoji Fufeng and IM Fufeng. He is in charge of the operations of Hulunbeir Fufeng. Mr. Feng graduated from 山東輕工業學院專科 (Shandong Institute of Light Industry) in 1990 majoring in electrical and mechanical technology. Mr. Feng was appointed as a director of Shandong Fufeng in May 2002 and has over 19 years of experience in the fermentation industry. He was one of the initial management Shareholders. Mr. Feng is interested in 15% of the issued share capital of Ever Soar, which in turn is interested in 185,112,000 Shares, representing approximately 10.63% of the issued share capital of the Company.

Xu Guohua

Executive Director and Vice General Manager

Mr. Xu, aged 44, is an executive Director and vice general manager of the Group who is responsible for Shenhua Pharmaceutical and the research and development of the Group. Mr. Xu is also a director of Shandong Fufeng, Baoji Fufeng and IM Fufeng. Mr. Xu graduated from 山東輕工業學院 (Shandong Institute of Light Industry) majoring in fermentation and economics management in July 1991 and 2003 respectively. He completed his study in fermentation engineering from 天津科技大學 (Tianjin University of Science and Technology) in September 2004. Mr. Xu has been elected to stand as the executive council member of the China Fermentation Industry Association in 2004 and prior to that was invited in 2002 to be a member of the Amino Acid Technology Committee under the China Fermentation Industry Association. Mr. Xu first joined Shandong Furui Brewery Group in 1991. Mr. Xu jointed the Group in June 1999 and has over 22 years of experience in the fermentation industry. He was also one of the initial management Shareholders. Mr. Xu was appointed a director of Shandong Fufeng in May 2002. Mr. Xu is interested in 15% of the issued share capital of Ever Soar, which in turn is interested in 185,112,000 Shares, representing approximately 10.63% of the issued share capital of the Company.

Li Deheng

Executive Director and Vice General Manager

Mr. Li, aged 44, is an executive Director and a vice general manager of the Group who is responsible for the Import and Export business of the Group. He is also a director of Shandong Fufeng, Baoji Fufeng and IM Fufeng. Mr. Li graduated from the 山東聊城師範學院 (Shandong Liaocheng Teacher’s College) in 1992 and obtained a bachelor’s degree in chemistry education. He joined the Group in January 2001 and was appointed a director of Shandong Fufeng in November 2003 and has over 12 years of experience in business management. Mr. Li Deheng is the brother-in-law of Mr. Li Xuechun. Mr. Li is interested in 15% of the issued share capital of Ever Soar, which in turn is interested in 185,112,000 Shares, representing approximately 10.63% of the issued share capital of the Company.

– 46 –

APPENDIX III

GENERAL INFORMATION

Chen Yuan

Executive Director and Chief Financial Officer

Mr. Chen, aged 43, is an executive Director and the chief financial officer of the Group. Mr. Chen is responsible for financial management, capital markets, corporate development and investor relations matters, and assist the Group to develop strategic planning and long-term development plan. Mr. Chen obtained a bachelor degree of accountancy from Xiamen University in 1991 and then received his Master in business administration degree from Birmingham Business school of University of Birmingham in 2001. Mr. Chen joined the Group in September 2010 and has over 20 years of experience in the corporate finance, corporate development and investor relation sector. Previously, he worked as a managing director and head of institutional sales for China Everbright Securities (HK) Limited. Mr. Chen was granted an option to subscribe for 5,000,000 Shares pursuant to the Post-IPO Share Option Scheme, representing 0.29% of the issued share capital of the Company.

Li Guangyu

Executive Director

Mr. Li, aged 34, is an executive Director and a vice general manager of the Group who is responsible for the project of Hulunbeir Plant of the Group. Mr. Li has over 7 years of experience in the fermentation industry. Mr. Li graduated from 華東政法大學研究生院 (East China University of Political Science and Law Graduate School) in 2006 and obtained a master’s degree in Laws. Mr. Li is the son of Mr. Li Xuechun. Mr. Li did not hold any directorship in other listed public companies in the last three years. Mr. Li is not interested in any shares of the Company pursuant to Part XV of the Securities and Future Ordinance.

Choi Tze Kit, Sammy

Independent Non-Executive Director

Mr. Choi, aged 50, was appointed as an independent non-executive Director in January 2007. Mr. Choi graduated from the Hong Kong Shue Yan College (presently known as Hong Kong Shue Yan University). He is an associate member of the Institute of Chartered Accountants in England and Wales, a fellow member of the Association of Chartered Certified Accountants and a fellow Certified Public Accountant of the Hong Kong Institute of Certified Public Accountants and a fellow member of the Taxation Institute of Hong Kong. Mr. Choi is also a council member of the Society of Chinese Accountants and Auditors. He has over 27 years of experience in finance and auditing.

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APPENDIX III

GENERAL INFORMATION

Chen Ning

Independent Non-Executive Director

Mr. Chen, aged 50, was appointed as an independent non-executive Director in January 2007. Mr. Chen is a professor at the 天津科技大學生物工程學院 (School of Bioengineering, Tianjin University of Science and Technology), and a committee member of the 天津微生物學會 (Tianjin Society for Microbiology). Mr. Chen had spent 10 years in the study and research in microbial metabolism in the control of fermentation processes and in the amino acids technology. Mr. Chen was coauthor to 6 academic textbooks and has written over 90 academic papers.

Liang Wenjun

Independent Non-Executive Director

Mr. Liang, aged 49, was appointed as an independent non-executive Director in January 2007. Mr. Liang is a professor of financial management at the 石油化工管理幹部學院 (Sinopec Management Institute) since 2010. Mr. Liang has over 22 years of experience in financial accounting, auditing and consulting. Mr. Liang received his bachelor’s degree in 1989 from 北京化工大學 (Beijing University of Chemical Technology) majoring in industrial engineering management.

Zheng Yu

Independent Non-Executive Director

Ms. Zheng, aged 44, was appointed as an independent non-executive Director on 31 December 2012. Ms. Zheng was a Managing Director at PineBridge Investments (formerly known as the AIG Global Investments), in charge of private equity investment in Greater China from 2008 to 2011. She also has over 15 years experience in the management consulting industry through her service at the Boston Consulting Group and then at Roland Berger Strategy Consultants as its senior partner responsible for the industrial and automotive industries practice in Greater China. Ms. Zheng is also a non executive director of Minth Group Limited (Stock code: 425) and Hengdeli Holdings Limited (Stock code: 3389).

Senior Management

Mr. Lai Fengtang , aged 44, is a vice general manager of the Group. Mr. Lai graduated from 西北大學 (Northwest University of China) in 1998. He first joined Shandong Furui Brewery Group in 1991. Mr. Lai joined the Group in June 1999 and has over 21 years of experience in the sales and marketing. Mr. Lai is the sole director of and is interested in 14.3% of the issued share capital of Hero Elite, which in turn is interested in 57,600,000 Shares, representing 3.31% of the issued share capital of the Company.

Mr. Shen Dequan , aged 47, is a vice general manager of Hulunbeir Fufeng. Mr. Shen graduated from 山東省臨沂農業學校 (The Agriculture School of Linyi) in 1986, majoring in forestry. Before joining Shandong Fufeng in 1999, he spent 6 years with the Shandong Furui Brewery Group. Mr. Shen has accumulated

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APPENDIX III

GENERAL INFORMATION

14 years of experience in production management. His current responsibilities within the Group include managing the production department. Mr. Shen is interested in 10.7% of the issued share capital of Hero Elite, which in turn is interested in 57,600,000 Shares, representing 3.31% of the issued share capital of the Company.

Mr. Xu Lingguo , aged 38, graduated in 1997 from 太原理工大學 (Taiyuan University of Technology) majoring in economic law. Mr. Xu joined the Group in 1999. Mr. Xu has 13 years of experience in the fermentation industry and is presently responsible for the Group’s logistic operation.

Mr. Li Hui , aged 46, is a general manager of the international trade department of the Group. He obtained his bachelor’s degree from 北京科技大學 (University of Science and Technology Beijing) in 1989. In 1999, Mr. Li completed a course in international trade at 對外貿易大學國際貿易專業 (University of International Business and Economics). He joined the Group in 2003 and is responsible for the Group’s international market development and sales.

Mr. Xiao Yong , aged 44, is a manager in the quality control department of Xinjiang Fufeng. Mr. Xiao obtained his bachelor’s degree from 湖南大學 (Hunan University) in 1992, majoring in chemical industry. Before joining the Group in 2003, Mr. Xiao has accumulated 11 years of experience in quality control management and is primarily responsible for the Group’s quality and production control.

Mr. Ge Wencun , aged 52, is a manager of operation department of Hulunbeir Fufeng and has joined the Group since 1999. Mr. Ge obtained his bachelor’s degree in 1986 from 山東輕工業學院 (Shandong Institute of Light Industry). Mr. Ge is currently responsible for the Group’s domestic and international market development. Mr. Ge first joined Shandong Furui Brewery Group in 1992 and has over 20 years of experience in the fermentation industry.

Mr. Zhang Yuannian , aged 39, is a manager of the finance department of IM Fufeng. Mr. Zhang first joined Shandong Furui Brewery Group in 1994 and graduated from 臨沂市商業學校 (The Commerce School of Linyi). He joined the Group in 1999 and has accumulated over 18 years of experience in finance.

Company Secretary and Qualified Accountant

Mr. Lee Wai Yin , aged 43, is the qualified accountant and company secretary of the Company since August 2008. Mr. Lee graduated from the Hong Kong Shue Yan College in 1993 with a diploma in accountancy and is a fellow member of the Association of Chartered Certified Accountants and an associate of the Hong Kong Institute of Certified Public Accountants. Mr. Lee has more than 19 years of working experience in finance and accounting including some with international accounting firms. Mr. Lee was granted an option to subscribe for 1,000,000 Shares pursuant to the Post-IPO Share Option Scheme, representing 0.06% of the issued share capital of the Company.

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APPENDIX III

GENERAL INFORMATION

Address of Directors and Senior Management

Executive Directors

Name

Address

Mr. Li Xuechun 37 Hualu Street, Junan County, Shandong Province, PRC Mr. Wang Longxiang 37 Hualu Street, Junan County, Shandong Province, PRC

Mr. Feng Zhenquan High-Tech Four Road, Weibin District, Baoji City, Shaanxi Province, PRC

Mr. Xu Guohua 37 Hualu Street, Junan County, Shandong Province, PRC

Mr. Li Deheng High-Tech Four Road, Weibin District, Baoji City, Shaanxi Province, PRC
Mr. Chen Yuan Flat E, 9th Floor., Golden Court, 36 Electric Road, Tin Hau, Hong Kong

Mr. Li Guangyu 37 Hualu Street, Junan County, Shandong Province, PRC

Independent non-executive Directors

Mr. Choi Tze Kit, Sammy Flat A, 5th Floor, Ming Court, 130–132 Boundary Street, Kowloon, Hong Kong
Mr. Chen Ning 2, Ren’An Lane, Xinhua Road, Heping District, Tianjin, PRC

Mr. Liang Wenjun Block 1, Unit 1, Room 601, Yichengdongyan, Hai Dian District, Beijing, PRC

Ms. Zheng Yu (Appointed Number 69 Lane 600, Ye Hui Road, Zhao Xiang, on 31 December 2012) Qingpu District, Shanghai, PRC 201703

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APPENDIX III

GENERAL INFORMATION

Senior Management

Name

Mr. Lai Fengtang
Mr. Shen Dequan
Mr. Xu Lingguo
Mr. Li Hui
Mr. Xiao Yong
Mr. Ge Wencun
Mr. Zhang Yuannian

Address

Building 3, No. 29 Jinghai 2nd Road, Beijing Economic-Technological Development Area, Beijing 101111, PRC
Ling Dong Industrial Development Zone, Zha Lan Tun County, Hulunbier, Inner Mongolia, PRC
Northern Section, Liong Shan Road, Junan County, Linyi, Shandong Province 276600, PRC
Building 3, No. 29 Jinghai 2nd Road, Beijing Economic-Technological Development Area, Beijing 101111, PRC
Xinjiang Fufeng Bio-Technology Limited, The 102th Division, Wujiaqu City, Xinjiang 831302, PRC
Ling Dong Industrial Development Zone, Zha Lan Tun County, Hulunbier, Inner Mongolia, PRC
No. 2 Road, Jin Chuan (South) Park, Economic & Technological Zone, Hohhot, Inner Mongolia 010070, PRC

– 51 –

APPENDIX III

GENERAL INFORMATION

6. DISCLOSURE OF INTERESTS

Directors and chief executive of the Company

As at the Latest Practicable Date, save as disclosed below, none of the Directors or chief executives of the Company had or was deemed to have any interests or short positions in the Shares, underlying Shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are deemed or taken to have under such provisions of the SFO) or which were required, pursuant to section 352 of the SFO to be entered into the register referred to therein or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers, to be notified to the Company and the Stock Exchange:

			Number of
			issued	Percentage of
			ordinary	issued share
	Long position/	Capacity and	shares	capital of the
Name	short position	nature of interest	interested	Company
Mr. Li Xuechun	Long position	Interest in a	802,781,000	46.11%
		controlled	(Note 1)
		corporation
Mr. Wang	Long position	Beneficial owner	6,910,000	0.40%
Longxiang			(Note 2)
Mr. Chen Yuan	Long position	Beneficial owner	5,000,000	0.29%
			(Note 3)

Notes:

The 802,781,000 Shares were registered in the name and were beneficially owned by BVI Controlling Shareholder, the entire issued share capital of which is wholly and beneficiary owned by Mr. Li Xuechun, an executive Director and the chairman of the Company, and is therefore deemed to be interested in the 802,781,000 Shares by virtue of the SFO.
The 6,910,000 Shares were registered in the name and were beneficially owned by Mr. Wang Longxiang and is therefore to be interested in the 6,910,000 Shares by virtue of the SFO.
Such interest in the Shares is held pursuant to the share options granted under the Share Option Scheme.

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APPENDIX III

GENERAL INFORMATION

Substantial Shareholders’ interests

As at the Latest Practicable Date, save as disclosed below, according to the list of substantial shareholders extracted from the website of the Stock Exchange and the register of interests kept by the Company under section 336 of the SFO, the following companies or persons (except for the Directors or chief executives of the Company) had an interest or short position in the Shares and as far as is known to the Directors, no person other than a Director whose interests are disclosed above, had an interest or short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, was, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meeting of any other member of the Group or had any option in respect of such capital:

			Percentage of
			interests to
			total issued
	Capacity/		share capital
Name	Nature of interest	Shareholding	(approximately)
Motivator Enterprises	Beneficial interest	802,781,000	46.1%
Limited (Note 1)		Shares
Ms. Shi Guiling (Note 2)	Interest of spouse	802,781,000	46.1%
		Shares
Ever Soar Enterprises	Beneficial interest	185,112,000	10.6%
Limited (Note 3)		Shares

Notes:

The interest in these Shares is held by Motivator Enterprises Limited, the entire issued share capital of which is wholly and beneficially owned by Mr. Li Xuechun, an executive Director and the chairman of the Company.
Ms. Shi Guiling is the spouse of Mr. Li Xuechun. Accordingly, she is also deemed to be interested in the Shares interested by Mr. Li Xuechun under the SFO.
Ever Soar Enterprises Limited is owned as to 15% by Mr. Feng Zhenquan, 15% by Mr. Xu Guohua, 15% by Mr. Li Deheng (all of whom are executive Directors), 25% by Mr. Wu Xindong (a former executive Director who resigned with effect from 9 March 2010), 15% by Mr. Yan Ruliang (a former executive Director who resigned with effect from 15 May 2009) and 15% by Mr. Guo Yingxi. Mr. Feng Zhequan is also the sole director of Ever Soar Enterprises Limited.

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APPENDIX III

GENERAL INFORMATION

7. INTERESTS IN CONTRACT OR ARRANGEMENT

As at the Latest Practicable Date

(a) none of the Directors had any direct or indirect interest in any assets which have been acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Group since 31 December 2012, being the date to which the latest published audited consolidated financial statements of the Group were made up; and
(b) none of the Directors was materially interested in contract or arrangement subsisting as at the Latest Practicable Date which is significant in relation to the business of the Group.

8. DIRECTORS’ SERVICE AGREEMENTS AND LETTERS OF APPOINTMENT

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

9. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse changes in the financial or trading position of the Group since 31 December 2012 (being the date to which the latest published audited accounts of the Company were made up).

10. COMPETING BUSINESS

As at the Latest Practicable Date, none of the Directors nor his or her associates was interested in any business part from the business of the Group, which competes or is likely to compete, either directly or indirectly, with that of the Group.

11. LITIGATION

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

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APPENDIX III

GENERAL INFORMATION

12. MATERIAL CONTRACTS

The following contracts (not being contracts in the ordinary course of business of the Company) have been entered by members of the Group within two years immediately preceding the date of this circular and up to the Latest Practicable Date which are or may be material:

(a) the indenture dated 13 April 2011 between the Company and Acquest Honour Holdings Limited, Summit Challenge Limited, Absolute Divine Limited, Expand Base Limited, Profit Champion International Limited, Full Profit Investment (Group) Limited, Trans-Asia Capital Resources Limited (collectively as Subsidiary Guarantors) and Citicorp International Limited (as Trustee) pursuant to which the Company has issued USD300 million senior notes for five years on 13 April 2011;
(b) the term loan facility agreement dated 12 November 2012 between the Company and Absolute Divine Limited, Acquest Honour Holdings Limited, Expand Base Limited, Full Profit Investment (Group) Limited, Fufeng International Trade (Hong Kong) Limited, Fufeng (Singapore) Pte. Ltd., Profit Champion International Limited, Summit Challenge Limited, Trans-Asia Capital Resources Limited (collectively as guarantors) and arranged by Deutsche Bank AG, Singapore Branch and Standard Chartered Bank (Hong Kong) Limited with Deutsche Bank acting as the facility agent and DB Trustees acting as the security trustee and supplemented by the land bank accession agreement dated 23 November 2012, pursuant to which the Company has borrowed USD150 million in November 2012; and
(c) the Underwriting Agreement.

13. EXPERT AND CONSENT

The following are the qualifications of the expert who has given its opinions or advice which are contained in this Prospectus:

Name Qualification

PricewaterhouseCoopers Certified Public Accountants

PricewaterhouseCoopers has given and has not withdrawn its written consent to the issue of this Prospectus with the inclusion herein of its report and the references thereto and to its name in the form and context in which they are included.

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APPENDIX III

GENERAL INFORMATION

As at the Latest Practicable Date, PricewaterhouseCoopers did not have any direct or indirect interest in any securities of any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for any securities in any member of the Group nor did they have any direct or indirect interest in any assets which had been, since 31 December 2012 (being the date to which the latest published audited accounts of the Company were made up), acquired or disposed of by, or leased to, or were proposed to be acquired or disposed of by, or leased to, any member of the Group.

14. GENERAL

(a) The expenses in connection with the Rights Issue, including underwriting commissions, printing, registration, legal, professional and accounting charges are estimated to amount to approximately HK$9.5 million and will be payable by the Company.
(a) The company secretary of the Company is Mr. Lee Wai Yin who is a fellow member of the Association of Chartered Certified Accountants and an associate of the Hong Kong Institute of Certified Public Accountants. Mr. Lee has more than 19 years of working experience in finance and accounting including some with international accounting firms. Mr. Lee was granted an option to subscribe for 1,000,000 Shares pursuant to the Share Option Scheme.
(c) The English text of this Prospectus, the PAL and the EAF shall prevail over the Chinese text in the event of inconsistency.

15. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES

A copy of each of the Rights Issue Documents and the written consent given by PricewaterhouseCoopers as referred to in the paragraph headed “Expert and Consent” in this Appendix has been delivered to the Registrar of Companies pursuant to Section 342C of the Companies Ordinance.

16. LEGAL EFFECT

The Rights Issue Documents and all acceptance of any offer or application contained in such documents are governed by and shall be construed in accordance with the laws of Hong Kong. Where an application is made in pursuance of any such documents, the relevant document(s) shall have the effect of rendering all person concerned bound by the provisions (other than the penal provisions) of Sections 44A and 44B of the Companies Ordinance.

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APPENDIX III

GENERAL INFORMATION

17. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the Company’s place of business in Hong Kong at Suite 1102, 11th Floor, Chinachem Century Tower, 178 Gloucester Road, Wanchai, Hong Kong during normal business hours on any weekday (Saturdays and public holidays excepted) for a period of 14 days from the date hereof:

(a) the memorandum and articles of association of the Company;
(b) the material contracts referred to in the paragraph headed “Material contracts” in this Appendix;
(c) the written consent referred to in the section headed “Expert and Consent” in this Appendix;
(d) the annual reports of the Company for the financial years ended 31 December 2010, 31 December 2011 and 31 December 2012;
(e) the report from PricewaterhouseCoopers in respect of the unaudited pro-forma financial information of the Group as set out in Appendix II to this Prospectus;
(f) a copy of each circular issued by the Company pursuant to the requirements set out in Chapter(s) 14 and/or 14A of the Listing Rules which has been issued since 31 December 2012, being the date of the Company’s latest published audited accounts; and
(g) this Prospectus.

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AI assistant

Fufeng Group Limited — Capital/Financing Update 2013

49286_rns_2013-04-11_50d343b8-ac40-40d6-afa4-b0f4b0d0c8b5.pdf

Fufeng Group Limited 阜豐集團有限公司

RIGHTS ISSUE OF RIGHTS SHARES AT HK$1.80 EACH ON THE BASIS OF 1 RIGHTS SHARE FOR EVERY 5 SHARES HELD ON THE RECORD DATE

FORWARD-LOOKING STATEMENTS

DEFINITIONS

EXPECTED TIMETABLE

EXPECTED TIMETABLE

Dealing in fully-paid Rights Shares

EFFECT OF BAD WEATHER ON THE LATEST TIME FOR ACCEPTANCE OF AND PAYMENT FOR RIGHTS SHARES

TERMINATION OF THE UNDERWRITING AGREEMENT

WARNING OF THE RISKS OF DEALINGS IN THE SHARES AND RIGHTS SHARES

Fufeng Group Limited 阜豐集團有限公司

(Stock Code: 546)

RIGHTS ISSUE OF RIGHTS SHARES AT HK$1.80 EACH ON THE BASIS OF 1 RIGHTS SHARE FOR EVERY 5 SHARES HELD ON THE RECORD DATE

INTRODUCTION

RIGHTS ISSUE

Issue Statistics

Basis of provisional allotments

Status of the Rights Shares

Fractions of Rights Shares (if any)

Qualifying Shareholders

Non-Qualifying Shareholders

Procedures for Acceptance and Payment or Transfer

General

Action to be taken by Qualifying Shareholders

Subscription for all Rights Shares provisionally allotted

Transfer and “Splitting” of Nil Paid Rights

Action to be taken by Beneficial Owners whose Shares are held by a Registered Shareholder (other than through CCASS)

Effect of bad weather on latest time for acceptance of and payment for Rights Shares and application for excess Rights Shares

Application for Excess Rights Shares

Action to be taken by Qualifying Shareholders who wish to apply for excess Rights Shares

Certificates for Rights Shares and refund cheques for the Rights Issue

Application for listing and dealing

Rights Shares will be eligible for admission into CCASS

Stamp duty and other applicable fees and charges

UNDERTAKINGS

Irrevocable undertaking from Controlling Shareholder

Irrevocable Undertaking from BVI 1, BVI 2, BVI 3, BVI 4 and Mr. Wang

UNDERWRITING ARRANGEMENTS

Principal terms of the Underwriting Agreement

CONDITIONS OF THE RIGHTS ISSUE

POSSIBLE CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY ARISING FROM THE RIGHTS ISSUE

REASONS FOR AND BENEFITS OF THE RIGHTS ISSUE AND USE OF PROCEEDS

FUND RAISING BY THE COMPANY IN THE PAST TWELVE MONTHS

ADJUSTMENTS IN RELATION TO THE EXERCISE PRICE AND/OR NUMBER OF SHARE OPTIONS

ADJUSTMENTS TO THE CONVERTIBLE BONDS

TAXATION

LISTING RULES IMPLICATIONS

FINANCIAL AND TRADING PROSPECTS OF THE GROUP

LETTER FROM THE BOARD

ADDITIONAL INFORMATION

1. FINANCIAL SUMMARY OF THE GROUP

2. STATEMENT OF INDEBTEDNESS

3. WORKING CAPITAL STATEMENT

A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

B. REPORT FROM REPORTING ACCOUNTANT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

ACCOUNTANT’S REPORT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION TO THE DIRECTORS OF FUFENG GROUP LIMITED

Respective Responsibilities of Directors of the Company and the Reporting Accountant

Basis of Opinion

Opinion

PricewaterhouseCoopers

1. RESPONSIBILITY STATEMENT

2. FURTHER INFORMATION ABOUT THE COMPANY

3. SHARE CAPITAL, CONVERTIBLE BONDS AND SHARE OPTIONS

Share Capital

Convertible Bonds

Share Options

5. PARTICULARS OF DIRECTORS AND SENIOR MANAGEMENT

Li Xuechun

Wang Longxiang

Feng Zhenquan

Xu Guohua

Li Deheng

Chen Yuan

Li Guangyu

Choi Tze Kit, Sammy

Chen Ning

Liang Wenjun

Fufeng Group Limited Capital/Financing Update 2013