Glory Sun Land Group Limited - M&A Activity 2012

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this Document or as to the action to be taken, you should consult a licensed securities dealer or registered institution in securities, a bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in SinoCom Software Group Limited, you should at once hand this Document, together with the accompanying Form(s) of Acceptance, to the purchaser or the transferee or to the bank, licensed securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. This Document should be read in conjunction with the accompanying Form(s) of Acceptance, the provisions of which form part of the terms of the Offers contained herein.

Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of this Document and the accompanying Form(s) of Acceptance, make no representation as to their 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 Document and the accompanying Form(s) of Acceptance.

SJI (HONG KONG) LIMITED

(Incorporated in Hong Kong with limited liability)

OFFER DOCUMENT RELATING TO MANDATORY CONDITIONAL CASH OFFERS BY HAITONG INTERNATIONAL SECURITIES COMPANY LIMITED ON BEHALF OF SJI (HONG KONG) LIMITED FOR ALL THE ISSUED SHARES IN SINOCOM SOFTWARE GROUP LIMITED

(OTHER THAN THOSE ALREADY OWNED BY SJI (HONG KONG) LIMITED AND PARTIES ACTING IN CONCERT WITH IT) AND

FOR THE CANCELLATION OF ALL OUTSTANDING SHARE OPTIONS

Financial adviser to SJI (Hong Kong) Limited

Haitong International Capital Limited

Capitalised terms used in this cover page shall have the same meanings as those defined in the section headed “Definitions” in this Document.

A letter from Haitong Securities is set out on pages 6 to 15 of this Document.

The procedures for acceptance and other information relating to the Offers are set out in Appendix I to this Document and in the accompanying Form(s) of Acceptance. Acceptances of the Share Offer should be received by the Registrar and acceptances of the Option Offer should be received by the company secretary of the Company by no later than 4:00 p.m. on Monday, 9 July 2012 or such later time and/or date as SJI (HK) may determine and announce in accordance with the Takeovers Code.

Persons including, without limitation, custodians, nominees and trustees who would, or otherwise intend to, forward this Document and/or the Form(s) of Acceptance to any jurisdiction outside Hong Kong should read the details in this regard which are contained in the sub-paragraph headed “Overseas Shareholders and Optionholders” under the paragraph headed “The Offers” in the letter from Haitong Securities on pages 6 to 15 of this Document and in paragraph 6 of Appendix I to this Document before taking any action. It is the responsibility of each Overseas Shareholder and overseas Optionholders wishing to accept the Offer(s) to satisfy himself, herself or itself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required and the compliance with other necessary formalities or legal requirements. Overseas Shareholders and overseas Optionholders are advised to seek professional advice on deciding whether to accept the Offers.

This Document will remain on the websites of the Stock Exchange at http://www.hkex.com.hk and the Company at www. sinocom.cn as long as the Offers remain open.

11 June 2012

	Page
Expected timetable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Letter from Haitong Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Appendix I – Further terms and procedures of acceptance
of the Offers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Appendix II – General information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Accompany documents – Form(s) of Acceptance

EXPECTED TIMETABLE

The timetable set out below is indicative only and any changes to the timetable will be announced by the Offeror.

2012

Despatch date of this Document

and the accompanying Form(s) of Acceptance

and commencement of the Offers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 11 June

Latest date for posting of the Response Document . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 25 June

Latest time and date for acceptance of the Offers

on the First Closing Date (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Monday, 9 July

First Closing Date (Note 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 9 July

Announcement of the results of the Offers

as at the First Closing Date

to be posted on the Stock Exchange’s website. . . . . . . . . . . . no later than 7:00 p.m. on Monday, 9 July
Latest date for posting of remittances for the amounts due in respect of valid acceptances received under the Offers
by the First Closing Date, assuming the Offers become

or are declared unconditional on such date (Note 3) . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 18 July

Latest time and date for acceptance of the Offers

if the Offers have been declared unconditional

on the First Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Monday, 23 July

Final closing date of the Offers

if the Offers have been declared unconditional

on the First Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 23 July

Latest date for posting of remittances for the amounts due

in respect of valid acceptances received under the Offers (Note 3) . . . . . . . . . . . . Wednesday, 1 August

Latest date by which the Offers can be declared unconditional (Note 4) . . . . . . . . . . . . Friday, 10 August

Notes:

The Share Offer will be subject to SJI (HK) having received acceptances in respect of the Shares which, together with the Shares already owned or to be acquired by SJI (HK) and parties acting in concert with it before or during the Offer Period, will result in SJI (HK) and parties acting in concert with it holding more than 50% of the voting rights of the Company. Pursant to Rules 13.4 of the Takeovers Code, the Option Offer will become unconditional upon the Share Offer becoming or being declared unconditional. The Offers are commenced for acceptance on 11 June 2012 and the latest time and date for acceptance of the Offers is 4:00 p.m. on Monday, 9 July 2012. Pursuant to the Takeovers Code, where the Offers are declared unconditional, the Offers will remain open for acceptance for not less than 14 days thereafter. SJI (HK) will make an announcement as and when the Offers become unconditional.

EXPECTED TIMETABLE

SJI (HK) reserves the right to revise or extend the Offers until such time and/or date as it may determine and in accordance with the Takeovers Code. SJI (HK) will issue an announcement to be posted on the Stock Exchange’s website by 7:00 p.m. on Monday, 9 July 2012, being the First Closing Date, as to whether the Offers have been revised or extended, have become or been declared unconditional.
Amounts due to each of the Shareholders and Optionholders who accepts the Offer(s) should be paid by SJI (HK) as soon as possible but in any event within seven Business Days of the later of the date on which the Offers become, or are declared, unconditional and the date of receipt of the duly completed Form(s) of Acceptance in accordance with the Takeovers Code.
In accordance with the Takeovers Code, in the event that the Offers (whether revised or not) have not become or been declared unconditional as to acceptances on or before Friday, 10 August 2012, being the 60th day after the day this Document was posted, the Offers will lapse unless the Executive consents to a later date.

Unless otherwise expressly stated, all time and date references contained in this Document refer to Hong Kong time and date.

iii

DEFINITIONS

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

“acting in concert”
“acting in concert” has the meaning ascribed thereto in the Takeovers Code “Agreement” the sale and purchase agreement dated 7 May 2012 and entered into among the Vendor, the Offeror SJI Inc., Mr. X Wang and Mr. Z Wang in relation to the sale and purchase of the Sale Shares
“associates” has the meaning ascribed thereto in the Takeovers Code and the Listing Rules (as appropriate)
“Board” the board of Directors “Business Day” a day on which the Stock Exchange is open for the transaction of business
“BVI” British Virgin Islands “CCASS” the Central Clearing and Settlement System established and operated by Hong Kong Securities Clearing Company Limited
“China Way” or “Vendor” China Way International Limited, a company incorporated in the BVI with limited liability, and owned as to 51% by Mr. X Wang and as to 49% by Mr. Z Wang, which held approximately 50.5% of the issued share capital of the Company immediately prior to Completion
“Company” SinoCom Software Group Limited (stock code: 299), a company incorporated in the Cayman Islands with limited liability, the issued shares of which are listed on the Main Board of the Stock Exchange
“Completion” completion of the sale and purchase of the Sale Shares in accordance with the terms of the Agreement
“Director(s)” the director(s) of the Company “Document” this offer document (with Form(s) of Acceptance in respect of the Offers) issued by the Offeror to the Independent Shareholders and the Optionholders in accordance with the Takeovers Code containing, among other things, details of the Offers

DEFINITIONS

“encumbrance” any mortgage, charge, pledge, lien, (otherwise than arising by statute or operation of law), equities, hypothecation or other encumbrance, priority or security interest, deferred purchase, title retention, leasing, sale-and-repurchase or sale-and-leaseback arrangement whatsoever over or in any property, assets or rights of whatsoever nature and includes any agreement for any of the same
“Executive” the Executive Director of the Corporate Finance Division of the SFC or any delegates of the Executive Director
“Facility” a margin loan facility of up to HK$382,000,000 granted by Haitong Securities to the Offeror
“First Announcement” the announcement of the Company dated 8 March 2012 in relation to, among other things, the possible disposal by China Way of its shareholdings in the Company
“First Closing Date” 9 July 2012, being the first closing date of the Offers which is 28 days after the date on which this Document is posted
“Form(s) of Acceptance” the accompanying WHITE form of acceptance and transfer of shares in respect of the Share Offer and the BLUE form of acceptance and cancellation of outstanding options relating to the Shares in respect of the Option Offer being separately despatched to the Optionholders
“Group” the Company and its subsidiaries
“Haitong Capital” Haitong International Capital Limited, a licensed corporation under the SFO permitted to engage in type 6 (advising on corporate finance) regulated activity, and the financial adviser to the Offeror
“Haitong Securities” Haitong International Securities Company Limited, a licensed corporation under the SFO permitted to engage in type 1 (dealing in securities), type 3 (leveraged foreign exchange trading) and type 4 (advising on securities) regulated activities
“Hong Kong” Hong Kong Special Administrative Region of the PRC
“Independent Board Committee”
the independent committee of the Board comprising all the independent non-executive Directors, which has been established to make recommendation to the Independent Shareholders and the Optionholders as to whether the Offers are fair and reasonable and as to the acceptance of the Offers

DEFINITIONS

“Independent Financial Adviser”	Somerley Limited, a licensed corporation to carry out type 1
	(dealing in securities), type 4 (advising on securities), type 6
	(advising on corporate finance) and type 9 (asset management)
	regulated activities under the SFO, and the independent financial
	adviser to the Independent Board Committee in respect of the
	Offers
“Independent Shareholders”	Shareholders other than the Vendor, the Offeror and parties acting
	in concert with them
“Joint Announcement”	the joint announcement dated 21 May 2012 issued by the
	Company and the Offeror in relation to, among other things, the
	Offers
“Last Trading Date”	7 May 2012, being the last trading day for the Shares on the Stock
	Exchange before the date of the Joint Announcement
“Latest Practicable Date”	8 June 2012, being the latest practicable date prior to the
	printing of this Document for the purpose of ascertaining certain
	information contained herein
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“Mr. X Wang”	Mr. Wang Xubing, an executive Director who beneficially owns
	51% of the issued share capital in China Way
“Mr. Z Wang”	Mr. Wang Zhiqiang, an executive Director who beneficially owns
	49% of the issued share capital in China Way
“Offeror” or “SJI (HK)”	SJI (Hong Kong) Limited, a company incorporated in Hong Kong
	with limited liability and an indirect wholly-owned subsidiary of
	the Purchaser’s Guarantor
“Offers”	together, the Share Offer and the Option Offer
“Offer Period”	has the meaning ascribed to it under the Takeovers Code and
	commencing from the date of the First Announcement until
	the First Closing Date or if the Offers become or are declared
	unconditional, 14 days thereafter
“Offer Share(s)”	Share(s) in respect of which the Share Offer is made, being
	Share(s) not already owned or agreed to be acquired by the
	Offeror and parties acting in concert with it and the Shares
	beneficially owned by China Way immediately after the
	Completion

DEFINITIONS

“Optionholders”	holders of the Share Option(s)
“Option Offer”	the mandatory conditional cash offer made by Haitong Securities
	on behalf of the Offeror for the cancellation of all outstanding
	Share Options in accordance with the Takeovers Code
“Option Offer Price(s)”	the price(s) at which the Option Offer is made, i.e. at HK$0.475
	per outstanding Share Option with exercise price of HK$0.625 and
	at HK$0.001 per outstanding Share Option with an exercise price
	of HK$1.36 or HK$1.3875
“Overseas Shareholders”	Shareholders, whose registered addresses, as shown on the register
	of members of the Company, are outside of Hong Kong
“PRC”	the People’s Republic of China, for the purposes of this
	Document, shall exclude Hong Kong, Macau Special
	Administrative Region of the PRC and Taiwan
“Registrar”	Tricor Investor Services Limited, being Hong Kong branch share
	registrar of the Company situated at 26th Floor, Tesbury Centre,
	28 Queen’s Road East, Wanchai, Hong Kong
“Relevant Period”	the period from 8 September 2011 (being the date falling six
	months prior to the First Announcement) up to and including the
	Latest Practicable Date
“Response Document”	the offeree board circular in respect to the Offers to be issued by
	the Company to the Shareholders and Optionholders in accordance
	with the Takeover Code
“Sale Shares”	a total of 451,604,000 Shares acquired by the Offeror from the
	Vendor pursuant to the terms and conditions of the Agreement,
	each a “Sale Share”
“SFC”	the Securities and Futures Commission of Hong Kong
“SFO”	Securities and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong)

DEFINITIONS

“Share(s)”	ordinary share(s) of HK$0.025 each in the issued share capital of
	the Company
“Shareholder(s)”	holder(s) of the Share(s)
“Share Offer”	the mandatory conditional cash offer made by Haitong Securities
	on behalf of the Offeror for all the Shares other than those already
	owned by the Offeror and parties acting in concert with it in
	accordance with the Takeovers Code
“Share Offer Price”	the price at which the Share Offer is made, i.e. at HK$1.1 per
	Offer Share
“Share Options”	options to subscribe for Shares granted by the Company in
	accordance with the share option scheme adopted by the Company
	on 2 April 2004
“SJI Inc.”	SJI Inc., a company incorporated in Japan and whose shares are
	listed on the JASDAQ Securities Exchange of the Osaka Stock
	Exchange with stock code 2315 and the ultimate holding company
	of the Offeror
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Takeovers Code”	the Hong Kong Code on Takeovers and Mergers
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“%”	per cent.

LETTER FROM HAITONG SECURITIES

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Haitong International Securities Company Limited 25th Floor New World Tower 16-18 Queen’s Road Central Hong Kong

11 June 2012

To the Independent Shareholders,

and the Optionholders

Dear Sir or Madam,

MANDATORY CONDITIONAL CASH OFFERS BY HAITONG INTERNATIONAL SECURITIES COMPANY LIMITED ON BEHALF OF SJI (HONG KONG) LIMITED FOR ALL THE ISSUED SHARES IN SINOCOM SOFTWARE GROUP LIMITED (OTHER THAN THOSE ALREADY OWNED BY SJI (HONG KONG) LIMITED AND PARTIES ACTING IN CONCERT WITH IT) AND

FOR THE CANCELLATION OF ALL OUTSTANDING SHARE OPTIONS

INTRODUCTION

On 21 May 2012, the Offeror and the Company jointly announced that, on 7 May 2012, the Offeror and the Vendor entered into the Agreement, pursuant to which the Offeror had agreed to acquire, and the Vendor had agreed to sell, the Sale Shares, being 451,604,000 Shares, for a total consideration of HK$496,764,400, representing HK$1.1 per Sale Share. The Sale Shares represent approximately 40.5% of the existing issued share capital of the Company. Completion of the Agreement took place on 8 May 2012, the Business Day following the signing of the Agreement.

Prior to Completion, neither the Offeror nor any of the parties acting in concert with it had any other interests in the share capital or voting rights of the Company. As a result of the acquisition of the Sale Shares, the Offeror and parties acting in concert with it have become interested in a total of 451,604,000 Shares, representing approximately 40.5% of the existing issued share capital of the Company. Pursuant to Rules 26.1 and 13.5 of the Takeovers Code, the Offeror is required to make mandatory conditional general offers in cash for all the issued Shares other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with it and cancellation of all outstanding Share Options.

LETTER FROM HAITONG SECURITIES

This letter sets out details of, among other things, the terms of the Offers, information on the Offeror and the intentions of the Offeror regarding the Group. Further details of the terms of the Offers are set out under the paragraph headed “ ACCEPTANCE AND SETTLEMENT ” below, in Appendix I to this Document and in the accompanying Form(s) of Acceptance. The Independent Shareholders and Optionholders are strongly advised to consider carefully the information contained in the letter from the Board, letter from the Independent Board Committee and letter from the Independent Financial Adviser to be contained in the Response Document.

THE OFFERS

Principal terms of the Offers

Haitong Securities, is making the Offers, on behalf of the Offeror in compliance with the Takeovers Code on the following terms:–

For every Offer Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$1.1 in cash

For cancellation of each Share Option with exercise price of:

Exercise price HK$0.625 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$0.475 in cash HK$1.36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$0.001 in cash HK$1.3875 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$0.001 in cash

The Share Offer Price for each Offer Share is HK$1.1, which is the same as the price per Sale Share paid by the Offeror under the Agreement. The Offer Shares to be acquired under the Share Offer shall be fully paid and free from any encumbrance and together with all rights which are on the date of despatch of this Document or may at any time thereafter becoming attaching to them including all dividends and distributions declared, paid or made in respect of them on or after the date of despatch of this Document.

The Option Offer Price for each outstanding Share Option with an exercise price of HK$0.625 per Share is HK$0.475, which represents the difference between the Share Offer Price and the exercise price of each of those Share Option.

The Option Offer Price for each outstanding Share Option with exercise price of HK$1.36 or HK$1.3875 is a nominal value of HK$0.001 because all such Share Options are out of money.

Comparison of value

The Share Offer Price of HK$1.1 per Offer Share represents:

(i) a premium of approximately 8.91% over the closing price of HK$1.01 per Share as quoted on the Stock Exchange on 7 May 2012, being the Last Trading Day;
(ii) a premium of approximately 9.13% over the average of the closing prices of the Shares as quoted on the Stock Exchange for the five trading days up to and including the Last Trading Day of HK$1.008 per Share;

LETTER FROM HAITONG SECURITIES

(iii) a premium of approximately 9.02% over the average of the closing prices of the Shares as quoted on the Stock Exchange for the 10 trading days up to and including the Last Trading Day of HK$1.009 per Share;
(iv) a premium of approximately 62.72% over the consolidated total equity attributable to equity holders of the Company of approximately HK$0.676 per Share as at 31 December 2011;
(v) a premium of approximately 29.4% over the closing price of HK$0.85 per Share as quoted on the Stock Exchange on 7 March 2012, being the last business day prior to the commencement of the Offer Period; and
(vi) a premium of approximately 0.92% over the closing price of HK$1.09 per Share as quoted on the Stock Exchange on the Latest Practicable Date.

Highest and lowest Share prices

The highest and lowest closing prices of the Shares as quoted on the Stock Exchange during the Relevant Period was HK$1.12 per Share (on 22 May and 23 May 2012) and HK$0.485 per Share (on 7 October 2011) respectively.

Value of the Offers

On the basis of the Share Offer Price of HK$1.1 per Offer Share and 1,115,835,128 Shares in issue, the entire issued share capital of the Company is valued at HK$1,227,418,640.80. Excluding the Sale Shares, being 451,604,000 Shares acquired and held by the Offeror pursuant to the Agreement, and the 111,396,000 Shares retained by the Vendor who irrevocably undertook (i) not to accept the Share Offer in respect of those retained Shares; and (ii) not to dispose any of those retained Shares until the close of the Offers, 552,835,128 Shares will be subject to the Share Offer and the Share Offer is therefore valued at HK$608,118,640.80 based on the Share Offer Price.

As at the Latest Practicable Date, the Company has 2,920,000, 13,560,000 and 12,630,000 outstanding Share Options with an exercise price of HK$0.625, HK$1.36 and HK$1.3875 respectively. Based on the Option Offer Price of HK$0.475 for the cancellation of each Share Option with an exercise price of HK$0.625 and HK$0.001 for cancellation of each Share Option with an exercise price of HK$1.36 or HK$1.3875, the consideration payable by the Offeror under the Option Offer for the cancellation of all outstanding Share Options is HK$1,413,190. Accordingly, the Offers are valued at HK$609,531,830.80 in aggregate.

Assuming all of the aforesaid outstanding Share Options are exercised by the Optionholders before the close of the Offers, 29,110,000 Shares will be issued and based on the Share Offer Price of HK$1.1 per Offer Share, an additional sum of HK$32,021,000 shall be payable by the Offeror under the Share Offer. Accordingly, the Offers are valued at HK$640,139,640.80 in aggregate on a fully-diluted basis.

LETTER FROM HAITONG SECURITIES

Financial resources available to the Offeror

The financial resources of the Offeror to fund the Offers amounting to an aggregate of HK$640,139,640.80 on a fully-diluted basis are financed as to HK$309,522,910.80 by the Offeror’s internal resources and the remaining balance by the Facility granted by Haitong Securities. The payment of interest on, repayment of or security for any liability under the Facility will not depend to any significant extent on the business of the Company. Haitong Capital has been appointed as the financial adviser to the Offeror in respect of the Offers and is satisfied that sufficient financial resources are available to the Offeror to satisfy full acceptance of the Offers as at the Latest Practicable Date.

Condition of the Offers

The Share Offer will be conditional upon the Offeror having received valid acceptances of the Share Offer in respect of such number of Shares which, together with the Shares already owned by the Offeror and parties acting in concert with it, will result in the Offeror and parties acting in concert with it holding more than 50% of the voting rights of the Company.

Pursuant to Rules 13.4 of the Takeovers Code, the Option Offer will become unconditional upon the Share Offer becoming or being declared unconditional.

Shareholders should note that if the total number of Shares in respect of which the Offeror receives valid acceptances under the Share Offer together with the Shares already owned by the Offeror and parties acting in concert with it during the Offer Period, will result in the Offeror and parties acting in concert with it holding 50% or less of the voting rights of the Company, the Offers will not become unconditional and will lapse. In such circumstances, pursuant to Rule 20.2 of the Takeovers Code, the Offeror is required to, as soon as possible but in any event within 10 days thereof, post the Share certificates or Share Option certificates (as the case may be) lodged with the forms of acceptance and transfer to, or make such Share certificates or Share Option certificates (as the case may be) available for collection by, those Shareholders or Optionholders who have accepted the Offer(s).

Dealing and interests in the Company’s securities

Save for the acquisition of the Sale Shares under the Agreement, none of the Offeror nor parties acting in concert with it has dealt in the Shares, outstanding Share Options, derivatives, warrants or other securities convertible into Shares during the Relevant Period. As at the Latest Practicable Date, the Offeror and parties acting in concert with it have not entered into any arrangements or contracts in relation to the outstanding derivatives in respect of securities in the Company nor have any of its members borrowed or lent any relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) in the Company. As at the Latest Practicable Date, save for the Sale Shares held by the Offeror, the Offeror and parties acting in concert with it do not hold, own or control any Shares, outstanding options, derivatives, warrants or other securities convertible into Shares.

LETTER FROM HAITONG SECURITIES

Stamp duty

Seller’s ad valorem stamp duty payable by the Shareholders who accept the Share Offer and calculated at a rate of 0.1% of (i) the market value of the Offer Shares; or (ii) consideration payable by the Offeror in respect of the relevant acceptances of the Share Offer, whichever is higher, will be deducted from the amount payable by the Offeror to such person on acceptance of the Share Offer upon the Offers becoming unconditional. The Offeror will arrange for payment of the seller’s ad valorem stamp duty on behalf of the accepting Shareholders and will pay the buyer’s ad valorem stamp duty in connection with the acceptances of the Share Offer and the transfer of the Offer Shares to the Stamp Office in accordance with the Stamp Duty Ordinance (Chapter 117 of the Laws of Hong Kong).

No stamp duty is payable in connection with the acceptance of the Option Offer.

Payment

Payment in cash in respect of acceptances of the Offers will be made as soon as possible but in any event within seven Business Days of the date on which the relevant documents of title are received by the Offeror to render each such acceptance complete and valid or when the Offers have become or declared unconditional, whichever is later.

Effect of accepting the Offers

Subject to the Offers becoming unconditional, by accepting the Share Offer, the Shareholders will sell their Shares free from all liens, claims and encumbrances and together with all rights attached to the Shares on the date of despatch of this Document, including the rights to receive in full all dividends and other distributions, if any, declared, made or paid on or after the date of despatch of this Document.

Subject to the Offers becoming unconditional, acceptance of the Option Offer by the Optionholders will result in the cancellation of those outstanding Share Options, together with all rights attaching thereto.

Other arrangements

As at the Latest Practicable Date, there is no arrangement (whether by way of option, indemnity or otherwise) in relation to the shares, convertible securities, warrants, options or derivatives of the Offeror or the Company and which might be material to the Offers. There is no agreement or arrangement to which the Offeror is a party which relate to circumstances in which it may or may not invoke or seek to invoke a pre-condition or a condition to the Offers. As at the Latest Practicable Date, none of the Offeror, its ultimate beneficial owner or parties acting in concert with any one of them has received any irrevocable commitment to accept the Offers or has borrowed or lent any relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) in the Company.

None of the Offeror, its ultimate beneficial owners or parties acting in concert with any one of them has entered into any contracts in relation to the outstanding derivatives in respect of securities in the Company as at the Latest Practicable Date.

LETTER FROM HAITONG SECURITIES

Overseas Shareholders and overseas Optionholders

As the Offers to persons not resident in Hong Kong may be affected by the laws of the relevant jurisdiction in which they are resident, Overseas Shareholders and Optionholders who are citizens or residents or nationals of a jurisdiction outside Hong Kong should inform themselves about and observe any applicable legal or regulatory requirements and where necessary seek legal advice. It is the responsibility of the Overseas Shareholders and/or overseas Optionholders who wish to accept the Share Offer and/or the Option Offer to satisfy themselves as to the full observance of the laws of the relevant jurisdiction in connection therewith (including the obtaining of any governmental or other consent which may be required or the compliance with other necessary formalities and the payment of any transfer or other taxes due in respect of such jurisdiction).

SHAREHOLDING STRUCTURE

Set out below are (i) the shareholding structure of the Company immediately before Completion; and (ii) the shareholding structure of the Company immediately after Completion and as at the Latest Practicable Date:

The Offeror China Way Dr. Shi Chong Ming, an executive Director Mr. Siu Kwok Leung, an executive Director Public Shareholders Total	Immediately before Completion Number of Approximate Shares % – – 563,000,000 50.5 5,543,200 0.5 4,280,000 0.4 543,011,928 48.6 1,115,835,128 100.0	Immediately after Completion and as at the Latest Practicable Date Number of Approximate Shares % 451,604,000 40.5 111,396,000 10.0 5,543,200 0.5 4,280,000 0.4 543,011,928 48.6 1,115,835,128 100.0

INFORMATION ON THE OFFEROR

The Offeror is a wholly-owned subsidiary of SJI Inc., a company incorporated in Japan and whose shares are listed on the JASDAQ Securities Exchange of the Osaka Stock Exchange. The principal activity of the Offeror is investment holding and the principal activity of SJI Inc. and its subsidiaries are IT systems development, software products, and information related products, as well as petrochemicals engineering services, and SJI Inc. has engaged in IT systems development business in the PRC and Japan for over 20 years.

With a view to strengthening the research and development capability and corporate branding of SJI Inc., and to engaging high quality customers, the business strategy of SJI Inc. redefined to focus on the long term business development and separation of businesses with different directions.

LETTER FROM HAITONG SECURITIES

SJI Inc. considered that cooperation between SJI Inc. and the Company may enhance the abilities in software development and customer sales, and go upstream in the software development process to be more value adding. SJI Inc. considers the aforesaid shall be achieved by the synergy in combining (i) the sales ability of SJI Inc. in Japan and upstream development ability of SJI Inc. and (ii) the software development ability of the Company in the PRC. SJI Inc. expects that the cooperation between SJI Inc. and the Company would bring more development projects in Japan, enhance the efficiency of the PRC staff and strengthen the corporate branding of SJI Inc., and establish a leading position in software development in the PRC and Japan.

OFFEROR’S INTENTION WITH RESPECT TO THE GROUP

The Offeror intends that the Group will continue its existing principal activities. The Offeror will regularly review the operations and business activities of the Group to formulate a suitable business strategy for the Group and will explore other business opportunities and consider whether any assets and/ or business acquisitions by the Group will be appropriate in order to enhance its growth. Apart from the proposed change of board composition as set out in the section below, the Offeror does not intend to introduce any major changes to the business of the Group, including (i) redeployment of the fixed assets of the Group; (ii) discontinuing the employment of employees of the Group, other than in the ordinary course of business; or (iii) injection, acquisition or disposal of any assets or businesses into the Company.

The Offeror considers that the acquisition of the Sale Shares and the Offers represent an opportunity to enhance the synergies on the sales and development capabilities between SJI Inc. and the Company. The Offeror therefore considers that the acquisition of Sale Shares and the Offers are in its long-term commercial interest.

PROPOSED CHANGE OF BOARD COMPOSITION

The Offeror currently intends to nominate two new executive Directors, namely Mr. Li Jian (“Mr. Li”) and Mr. Kotoi Hirofumi (“Mr. Kotoi”), and one new independent non-executive Director, namely Mr. Yamamoto Yoshimasa (“Mr. Yamamoto”) to the Board with effect from 11 June 2012, being the date of the despatch of this Document.

The biographical details of Mr. Li, Mr. Kotoi and Mr. Yamamoto (the “New Directors”) are as follows:

Executive Directors

Mr. Li Jian, aged 50, is the Chairman and president of SJI Inc., and is mainly responsible for the daily management of SJI Inc.. SJI Inc. is the ultimate holding company of SJI (HK), the controlling shareholder of the Company. Mr. Li obtained his master degree in computer science in The University of Electro-Communications in Japan in 1987. 1n 1990, Mr. Li joined Sun Japan, which later merged with other companies and formed SJI Inc.. Mr. Li also held 41,840 shares of SJI Inc., representing approximately 5.05% of the total issued share capital of SJI Inc. as at the Latest Practicable Date.

LETTER FROM HAITONG SECURITIES

Mr. Kotoi Hirofumi, aged 49, is the vice president and a director of SJI Inc., and is mainly responsible for the daily management of SJI Inc.. SJI Inc. is the ultimate holding company of SJI (HK), the controlling shareholder of the Company. Mr. Kotoi obtained his master degree in information engineering in Kyoto University in Japan in 1987. In 1990, Mr. Kotoi joined Sun Japan, which later merged with other companies and formed SJI Inc.. Mr. Kotoi is also a director of LianDi Clean Technology Inc., a company whose shares are traded on OTC Bulletin Board in the United States of America. Mr. Kotoi also held 27,442 shares of SJI Inc., representing approximately 3.31% of the total issued share capital of SJI Inc. as at the Latest Practicable Date.

Independent non-executive Directors

Mr. Yamamoto Yoshimasa, aged 68, is the Chairman of Y’s Consulting Limited in Japan and the Chairman of Y’s Consulting Limited in Hong Kong. Mr. Yamamoto graduated from the School of Business Administration of Hosei University in Japan in 1967, and obtained the professional qualifications as a certified public accountant and a tax accountant in Japan in 1973. Mr. Yamamoto established 山本公認會計士事所 (Yamamoto Certified Public Accountants*, the predecessor of Y’s Consulting Limited) in 1975.

Each of Mr. Li and Mr. Kotoi will enter into a service contract with the Company, and the details of which will be disclosed in a further announcement to be made by the Company together with the terms of appointment of Mr. Yamamoto.

As at the Latest Practicable Date, save as disclosed above, each of the New Directors confirms that (i) he does not have any relationship with any Directors, senior management, management shareholders, substantial shareholders, or controlling shareholder of the Company; (ii) he does not have any interest in the Shares within the meaning of Part XV of the SFO; (iii) he does not hold other positions with the Company and other members of the Group; (iv) he did not hold any directorship in the last three years in any public companies the securities of which are listed on any securities market in Hong Kong or overseas; and (v) he does not have any other matters that need to be brought to the attention of the Shareholders nor does he have any other information that is required to be disclosed pursuant to any of the requirements under 13.51(2) of the Listing Rules.

As at the Latest Practicable Date, the Offeror had not identified other candidates for appointment on the Board. Any changes to the Board will be made in compliance with the Takeovers Code and the Listing Rules and further announcement will be made pursuant to Rule 13.51(2) of the Listing Rules accordingly.

Save as disclosed above, the Offeror does not intend that there would be any material changes to the existing management and employees of the Group following the closing of the Offers.

MAINTAINING THE LISTING STATUS OF THE COMPANY

The Stock Exchange has stated that if, upon closing of the Offers, less than the minimum prescribed percentage applicable to the Company, being 25%, of the Shares are held by the public or if the Stock Exchange believes that (i) a false market exists or may exist in the trading of the Shares; or (ii) there are insufficient Shares in public hands to maintain an orderly market, then it will consider exercising its discretion to suspend trading in the Shares.

LETTER FROM HAITONG SECURITIES

The Offeror intends to maintain the listing of the Shares on the Stock Exchange after the close of the Offers. The directors of the Offeror and the New Directors will jointly and severally undertake to the Stock Exchange to take appropriate steps to ensure that minimum public float of not less than 25% of the Company’s entire issued ordinary share capital as required under the applicable Listing Rules will be restored or maintained (as applicable) following the close of the Offers.

COMPULSORY ACQUISITION

The Offeror does not intend to exercise or apply any right which may be available to it to acquire compulsorily any Shares outstanding after the close of the Offers.

FURTHER TERMS OF THE OFFERS

Further terms of the Offers, including, among others, procedures for acceptance and settlement, the acceptance period and taxation matters are set out in Appendix I to this Document and in the Form(s) of Acceptance.

GENERAL

To ensure equality of treatment of all Independent Shareholders, those Independent Shareholders who hold the Shares as nominees for more than one beneficial owners should, as far as practicable, treat the holding of each beneficial owner separately. In order for the beneficial owners of the Shares whose investments are registered in nominee names to accept the Share Offer, it is essential that they provide instructions of their intentions with regard to the Offers to their nominees.

The attention of the Overseas Shareholders and the overseas Optionholders is drawn to paragraph 6 of Appendix I to this Document.

All documents and remittances to the Independent Shareholders and the Optionholders will be sent to them by ordinary post at their own risk to their addresses as they appear in the register of members of the Company (in the case of the Share Offer) or the records of the Company (in the case of the Option Offer) or, in the case of joint Independent Shareholders, to the Independent Shareholder whose name appears first in the branch register of members of the Company, as applicable. None of SJI (HK), the Company, Haitong Securities nor any of their respective directors or any other person involved in the Offers will be responsible for any loss or delay in transmission or any other liabilities that may arise as a result thereof.

Stockbrokers, banks and others who deal in relevant securities of the Company on behalf of clients have a general duty to ensure, so far as they are able, that those clients are aware of the disclosure obligations attaching to associates and other persons under Rule 22 of the Takeovers Code and those clients are willing to comply with them. Principal traders and dealers who deal directly with investors should, in appropriate cases, likewise draw attention to the relevant Rules pursuant to the Takeovers Code. However, this does not apply when the total value of dealings (excluding stamp duty and commission) in any relevant security undertaken for a client during any seven day period is less than HK$1 million.

This dispensation does not alter the obligation of principals, associates and other persons themselves to initiate disclosure of their own dealings, whatever total value is involved.

LETTER FROM HAITONG SECURITIES

Intermediaries are expected to co-operate with the Executive in its dealings enquiries. Therefore, those who deal in relevant securities should appreciate that stockbrokers and other intermediaries will supply the Executive with relevant information as to those dealings, including identities of clients, as part of that co-operation.

ADDITIONAL INFORMATION

Your attention is drawn to the accompanying Form(s) of Acceptance and the additional information set out in the appendices which form part of this Document. Your attention is also drawn to the letter from the Board, the letter from the Independent Board Committee to the Independent Shareholders, and the Optionholders and the letter from the Independent Financial Adviser to the Independent Board Committee to be contained in the Response Document.

Yours faithfully, For and on behalf of

Haitong International Securities Company Limited William Lee Managing Director

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

1. PROCEDURES FOR ACCEPTANCE

1.1 The Share Offer

(a) If the Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) in respect of your Shares is/are in your name, and you wish to accept the Share Offer, you must send the duly completed and signed WHITE Form of Acceptance together with the relevant Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) by post or by hand, to the Registrar, at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong in any event not later than 4:00 p.m. on Monday, 9 July 2012 or such later time and/or date as SJI (HK) may determine and announce in accordance with the Takeovers Code.
(b) If the Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) in respect of your Shares is/are in the name of a nominee company or a name other than your own, and you wish to accept the Share Offer in respect of your holding of Shares (whether in full or in part), you must either:
(i) lodge your Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) with the nominee company, or other nominee, and with instructions authorising it to accept the Share Offer on your behalf and requesting it to deliver the WHITE Form of Acceptance duly completed together with the relevant Share certificate(s) and/ or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) to the Registrar; or
(ii) arrange for the Shares to be registered in your name by the Company through the Registrar, and deliver the WHITE Form of Acceptance duly completed and signed together with the relevant Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) to the Registrar; or
(iii) if your Shares have been lodged with your licensed securities dealer/registered institution in securities/custodian bank through CCASS, instruct your licensed securities dealer/registered institution in securities/custodian bank to authorise HKSCC Nominees Limited to accept the Share Offer on your behalf on or before the deadline set by HKSCC Nominees Limited. In order to meet the deadline set by HKSCC Nominees Limited, you should check with your licensed securities dealer/ registered institution in securities/custodian bank for the timing on the processing of your instruction, and submit your instruction to your licensed securities dealer/ registered institution in securities/custodian bank as required by them; or

APPENDIX I

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

(iv) if your Shares have been lodged with your investor participant’s account maintained with CCASS, give your instruction via the CCASS Phone System or CCASS Internet System on or before the deadline set by HKSCC Nominees Limited.
(c) If you have lodged transfer(s) of any of your Shares for registration in your name and have not yet received your Share certificate(s), and you wish to accept the Share Offer in respect of your Shares, you should nevertheless complete and sign the WHITE Form of Acceptance and deliver it to the Registrar together with the transfer receipt(s) duly signed by yourself. Such action will constitute an irrevocable authority to SJI(HK) and/or Haitong Securities or their respective agent(s) to collect from the Company or the Registrar on your behalf the relevant Share certificate(s) when issued and to deliver such Share certificate(s) to the Registrar on your behalf and to authorise and instruct the Registrar to hold such Share certificate(s), subject to the terms and conditions of the Share Offer, as if it was/they were delivered to the Registrar with the WHITE Form of Acceptance.
(d) If the Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) in respect of your Shares is/are not readily available and/or is/are lost, as the case may be, and you wish to accept the Share Offer in respect of your Shares, the WHITE Form of Acceptance should nevertheless be completed and delivered to the Registrar together with a letter stating that you have lost one or more of your Share certificate(s) and/or transfer receipt(s) and/or other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) or that it is/they are not readily available. If you find such document(s) or if it/ they become(s) available, the relevant Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) should be forwarded to the Registrar as soon as possible thereafter. If you have lost your Share certificate(s) and/or transfer receipt(s) and/or other document(s) of title, you should also write to the Registrar for a letter of indemnity which, when completed in accordance with the instructions given, should be returned to the Registrar.
(e) Acceptance of the Share Offer will be treated as valid only if the completed WHITE Form of Acceptance is received by the Registrar on or before the latest time for acceptance of the Share Offer and the Registrar has recorded that the acceptance and any relevant documents required by Note 1 to Rule 30.2 of the Takeovers Code have been so received, and is:
(i) accompanied by the relevant Share certificate(s) and/or transfer receipt(s) and/or other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) and, if those Share certificate(s) and/or transfer receipt(s) and/or other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) is/are not in your name, such other documents (e.g. a duly stamped transfer of the relevant Share(s) in blank or in favour of you, the person accepting the Share Offer, executed by the registered holder) in order to establish your right to become the registered holder of the relevant Shares; or

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

(ii) from a registered Shareholder or his personal representatives (but only up to the amount of the registered holding and only to the extent that the acceptance relates to the Shares which are not taken into account under another sub-paragraph of this paragraph (e)); or
(iii) certified by the Registrar or the Stock Exchange.

If the WHITE Form of Acceptance is executed by a person other than the registered Shareholder, appropriate documentary evidence of authority (e.g. grant of probate or certified copy of a power of attorney) to the satisfaction of the Registrar must be produced.

(f) Seller’s ad valorem stamp duty payable by the Independent Shareholders who accept the Share Offer and calculated at a rate of HK$1.00 for every HK$1,000 (or part thereof) of the market value of the Offer Shares or consideration payable by SJI(HK) in respect of the relevant acceptances of the Share Offer, whichever is the higher, will be deducted from the amount payable by SJI (HK) to the relevant Independent Shareholders on acceptance of the Share Offer. SJI (HK) will arrange for payment of the seller’s ad valorem stamp duty on behalf of the accepting Independent Shareholders and will pay the buyer’s ad valorem stamp duty in connection with the acceptance of the Share Offer and the transfer of the Offer Shares.
(g) If the Share Offer is withdrawn or lapses, SJI (HK) shall, as soon as possible but in any event within 10 days thereof, return by ordinary post the Share certificate(s) and/or transfer receipt(s) and/or other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) lodged with the WHITE Form of Acceptance to the relevant Independent Shareholder(s).
(h) No acknowledgement of receipt of any WHITE Form of Acceptance, Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof ) will be given.

1.2 The Option Offer

(a) If you accept the Option Offer, you should complete the BLUE Form of Acceptance in accordance with the instructions printed thereon in respect of the number of Share Options held by you that you wish to tender to the Option Offer, which instructions form part of the terms and conditions of the Option Offer.
(b) The completed BLUE Form of Acceptance should be forwarded, together with the relevant certificate(s) of the Share Option stating the number of Share Options for not less than the number in respect of which you intend to accept the Option Offer, by post or by hand as soon as possible and in any event so as to reach the company secretary of the Company at Unit 1601, 16/F Shui On Centre, 6-8 Harbour Road, Wanchai, Hong Kong no later than 4:00 p.m. on Monday, 9 July 2012 or such later time and/or date as SJI (HK) may determine and announce in accordance with the Takeovers Code.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

(c) If the Option Offer is withdrawn or lapses, SJI (HK) shall, as soon as possible but in any event within 10 days thereof, return by hand or by ordinary post the certificate(s) of the Share Options lodged with the BLUE Form of Acceptance to the relevant holder(s) of the Share Options.
(d) No stamp duty will be deducted from the amount paid to the holder(s) of the Share Options who accept(s) the Option Offer.
(e) No acknowledgement of receipt of any BLUE Form of Acceptance and/or the certificate(s) of the Share Options will be given.

2. ACCEPTANCE PERIOD AND REVISIONS

(a) In order to be valid, Form(s) of Acceptance for the Offers must be received by the Registrar (in case of the Share Offer) and the company secretary of the Company (in case of the Option Offer) in accordance with the instructions printed thereon by 4:00 p.m. on Monday, 9 July 2012, unless the Offers become or are declared unconditional, or are extended or revised with the consent of the Executive. The Offers are conditional upon SJI (HK) having received acceptances in respect of the Shares which, together with the Shares already held by it and parties acting in concert with it, will result in SJI (HK) and parties acting in concert with it holding more than 50% of the voting rights of the Company. Pursuant to the Takeovers Code, where the Share Offer is declared unconditional, the Offers will remain open for acceptance for not less than 14 days thereafter. SJI (HK) will make an announcement as and when the Offers become or are declared unconditional.
(b) SJI (HK) reserves the right to revise the Offers after the despatch of this Document until such day as it may determine and in accordance with the Takeovers Code. If SJI (HK) revises the terms of the Offers, all Independent Shareholders and Optionholders, whether or not they have already accepted the Offers, will be entitled to accept the revised Offers under the revised terms.
(c) If the Offers are extended or revised, the announcement of such extension or revision will state the next closing date or the Offers will remain open until further notice. In the latter case, at least 14 days’ notice in writing will be given before the Offers are closed to the Independent Shareholders and the Optionholders who have not accepted the Offers, and an announcement will be released. The revised Offers must be kept open for at least 14 days following the date on which the revised offer document is posted.
(d) If the closing date of the Offers is extended, any reference in this Document and in the Form(s) of Acceptance to the closing date shall, except where the context otherwise requires, be deemed to refer to the closing date of the Offers as so extended.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

3. ANNOUNCEMENTS

(a) By 6:00 p.m. on the First Closing Date (or such later time and/or date as the Executive may in exceptional circumstances permit), SJI (HK) must inform the Executive and the Stock Exchange of its decision in relation to the revision, extension, expiry or unconditionality of the Offers. SJI (HK) must publish an announcement on the Stock Exchange’s website by 7:00 p.m. on the First Closing Date stating whether the Offers have been revised or extended, have expired or have become or been declared unconditional (whether as to acceptances or in all respects).

The announcement will state the total number of Shares and rights over Shares including Share Options:

(a) for which acceptances of the Offers have been received;
(b) held, controlled or directed by SJI (HK) or its concert parties before the Offer Period; and
(c) acquired or agreed to be acquired during the Offer Period by SJI(HK) or any of its concert parties.

The announcement must include details of any relevant securities (as defined in the Takeovers Code) in the Company which SJI (HK) or any parties acting in concert with it has borrowed or lent.

The announcement must also specify the percentages of the issued share capital of the Company and the percentages of voting rights of the Company represented by these numbers of Shares.

(b) In computing the total number of Shares and Share Options represented by acceptances, only valid acceptances that are complete and in good order or that are subject to verification may only be included where they could be counted towards fulfilling the acceptance condition under paragraph 1.1(e) (as regards the Share Offer) and paragraph 1.2(b) (as regards the Option Offer) of this Appendix I according to the requirements under Note 1 to Rule 30.2 of the Takeovers Code.
(c) As required under the Takeovers Code, all announcements in respect of the Offers will be made in accordance with the requirements of Listing Rules.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

4. RIGHT OF WITHDRAWAL

(a) Acceptance of the Offers tendered by the Independent Shareholders and the Optionholders, as the case may be, shall be irrevocable and cannot be withdrawn, except in the circumstances set out in sub-paragraph (b) below or in compliance with Rule 17 of the Takeovers Code, which provides that an acceptor of any of the Offers shall be entitled to withdraw his/her/its acceptance within 21 days from the First Closing Date if the Offers have not by then become unconditional as to acceptances. An acceptor of any of the Offers may withdraw his/her/its acceptance by lodging a notice in writing signed by the acceptor (or his/her/its agent duly appointed in writing and evidence of whose appointment is produced together with the notice) to the Registrar or the company secretary of the Company, as the case may be.
(b) If SJI (HK) is unable to comply with the requirements set out in the paragraph headed “Announcements” above, the Executive may require that the Independent Shareholders and the Optionholders who have tendered acceptances to the Offers be granted a right of withdrawal on terms that are acceptable to the Executive until the requirements set out in that paragraph are met.

5. SETTLEMENT OF THE OFFERS

(a) The Share Offer

Subject to the Share Offer becoming or being declared unconditional and provided that a valid WHITE Form of Acceptance and the relevant Share certificate(s) and/or transfer receipt(s) and/or any other document(s) of title (and/or any satisfactory indemnity or indemnities required in respect thereof) are complete and in good order in all respects and have been received by the Registrar before the close of the Share Offer, a cheque for the amount due to each of the accepting Independent Shareholders less seller’s ad valorem stamp duty in respect of the Offer Shares tendered by him under the Share Offer will be despatched to such Independent Shareholder by ordinary post at his own risk as soon as possible but in any event within seven Business Days of the later of the date on which the Share Offer becomes or is declared unconditional and the receipt of all the relevant documents by the Registrar to render such acceptance complete and valid.

Settlement of the consideration to which any Independent Shareholder is entitled under the Share Offer will be implemented in full in accordance with the terms of the Share Offer (save with respect of the payment of seller’s ad valorem stamp duty), without regard to any lien, right of set-off, counterclaim or other analogous right to which SJI (HK) may otherwise be, or claim to be, entitled against such Independent Shareholder.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

(b) The Option Offer

Subject to the Share Offer becoming or being declared unconditional and provided that a valid BLUE Form of Acceptance and the relevant certificate(s) of the Share Options are complete and in good order in all respects and have been received by the company secretary of the Company before the close of the Option Offer, a cheque for the amount due to the Optionholder in respect of the Share Options tendered by him under the Option Offer will be despatched to such Optionholder by ordinary post at his own risk as soon as possible but in any event within seven Business Days of the later of the date on which the Option Offer becomes or is declared unconditional and the receipt of all the relevant documents by the company secretary of the Company to render such acceptance complete and valid.

Settlement of the consideration to which any Optionholder is entitled under the Option Offer will be implemented in full in accordance with the terms of the Option Offer, without regard to any lien, right of set-off, counterclaim or other analogous right to which SJI(HK) may otherwise be, or claim to be, entitled against such Optionholder.

6. OVERSEAS SHAREHOLDERS AND OVERSEAS OPTIONHOLDERS

The making of the Offers to Overseas Shareholders and overseas Optionholders may be prohibited or affected by the laws of the relevant jurisdictions. Overseas Shareholders and overseas Optionholders should inform themselves about and observe any applicable legal requirements. It is the responsibility of each person wishing to accept the Offers to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required and the compliance with other necessary formalities or legal requirements and the payment of any transfer or other taxes due by such overseas Shareholder and/ or overseas Optionholders in respect of such jurisdiction. Acceptances of the Offers by any such person will constitute a warranty by such person that such person is permitted under all applicable laws to accept the Offers and any revision thereof, and such acceptance shall be valid and binding in accordance with all applicable laws.

7. GENERAL

(a) All communications, notices, Forms of Acceptance, Share certificates, certificates of the Share Options, transfer receipts, other documents of title and/or any satisfactory indemnity or indemnities required in respect thereof and remittances to settle the consideration payable under the Offers to be delivered by or sent to or from the Independent Shareholders and the Optionholders will be delivered by or sent to or from them, or their designated agents, by post at their own risk, and none of the Company, SJI (HK), Haitong Securities and any of their respective agents nor the Registrar or the company secretary of the Company or other parties involved in the Offers accepts any liability for any loss in postage or any other liabilities that may arise as a result thereof.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

(b) The provisions set out in the Form(s) of Acceptance form part of the terms and conditions of the Offers.
(c) The accidental omission to despatch this Document and/or Form(s) of Acceptance or any of them to any person to whom the Offers are made will not invalidate the Offers in any way.
(d) The Offers are, and all acceptances will be, governed by and construed in accordance with the laws of Hong Kong.
(e) Due execution of the Form(s) of Acceptance will constitute an authority to SJI (HK), Haitong Securities or such person or persons as SJI (HK) may direct to complete and execute any document on behalf of the person or persons accepting the Offers and to do any other act that may be necessary or expedient for the purposes of vesting in SJI (HK), or such person or persons as it may direct, the Shares and/or the Share Options in respect of which such person or persons has/have accepted the Offers.
(f) Acceptance of the Share Offer by any person will be deemed to constitute a warranty by such person to SJI (HK) and the Company:
(i) that the Shares tendered for acceptance under the Share Offer are sold by such person free from all third party rights, liens, claims, charges, equities and encumbrances and together with all rights accruing or attaching thereto on the date of despatch of this Document or may at any time thereafter becoming attaching to them including all future dividends and/or other distributions declared, paid or made, if any, on or after the date of despatch of this Document; and
(ii) that if such Shareholder accepting the Share Offer is an Overseas Shareholder, he has observed the laws of all relevant jurisdictions in connection therewith, obtained all requisite governmental, exchange control or other consents, complied with other necessary formalities or legal requirements and paid any transfer or other taxes due from him in respect of such jurisdictions, and is permitted under all applicable laws to accept the Share Offer and any revision thereof, and that such acceptance is valid and binding in accordance with all applicable laws.
(g) Acceptances of the Option Offer by the Optionholder will be deemed to constitute a warranty by such Optionholders to SJI (HK) that the Share Options tendered for acceptance are free from all third party rights, liens, claims, charges, equities, and encumbrances whatsoever and renounced together with all rights accruing or attaching thereto on the date of despatch of this Document and that such Optionholder will surrender to the Company all of his existing rights, if any, in respect of the Share Options.

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

(h) Acceptance of the Share Offer by any nominee will be deemed to constitute a warranty by such nominee to SJI (HK) that the number of Shares in respect of which it is indicated in the WHITE Form of Acceptance is the aggregate number of Shares held by such nominee for such beneficial owner who is accepting the Share Offer.
(i) Reference to the Offers in this Document and in the Form(s) of Acceptance shall include any extension or revision thereof and references to the Offers becoming unconditional shall include a reference to the revised Offers being declared unconditional.
(j) The English text of the this Document and the Form(s) of Acceptance shall prevail over their respective Chinese text to the purpose of interpretation.

GENERAL INFORMATION

APPENDIX II

1. RESPONSIBILITY STATEMENT

This Document includes particulars given in compliance with the Takeovers Code for the purpose of providing information to Shareholders and Optionholders with regard to SJI (HK), the Group and the Offers.

The directors of SJI Inc. and the directors of SJI (HK) jointly and severally accept full responsibility for the accuracy of the information contained in this Document (other than the information relating to the Group), and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this Document have been arrived at after due and careful consideration and there are no other facts not contained in this Document, the omission of which would make any such statement contained in this Document misleading.

The information relating to the Group contained in the Document has been taken from the announcements and reports issued by the Company as published on the website of the Stock Exchange. The only responsibility accepted by the directors of the Offeror in respect of information relating to the Group is to ensure that it has been correctly and fairly reproduced or presented.

2. MARKET PRICES

The table below shows the closing price of the Shares quoted on the Stock Exchange on (i) the last day on which trading took place in each of the calendar months during the Relevant Period; (ii) the last business day prior to the commencement of the Offer Period; (iii) the Last Trading Day; and (iv) the Latest Practicable Date:

	Closing price
Date	per Share
	HK$
30 September 2011	0.53
31 October 2011	0.54
30 November 2011	0.51
30 December 2011	0.55
31 January 2012	0.66
29 February 2012	0.70
7 March 2012 (last business day prior to the commencement of the Offer Period)	0.85
30 March 2012	0.90
30 April 2012	1.00
7 May 2012 (Last Trading Day)	1.01
31 May 2012	1.08
8 June 2012 (being the Latest Practicable Date)	1.09

The highest and lowest closing prices of the Shares during the Relevant Period were HK$1.12 per Share on 22 May and 23 May 2012 and HK$0.485 per Share on 7 October 2011 respectively.

GENERAL INFORMATION

APPENDIX II

3. DISCLOSURE OF INTERESTS OF SJI(HK) AND ITS DIRECTORS

SJI (HK) is an indirect wholly-owned subsidiary of SJI Inc., a company incorporated in Japan and whose shares are listed on the JASDAQ Securities Exchange of the Osaka Stock Exchange.

Save for the interest in a total of 451,604,000 Shares as a result of the acquisition of the Sale Shares, none of SJI (HK), its directors and parties acting in concert with SJI (HK) had any other interest in the Shares, options, warrants, derivatives or securities which are convertible into Shares as at the Latest Practicable Date. Save for the acquisition of the Sale Shares, SJI (HK), its directors and parties acting in concert with any of them have not dealt in the Shares, convertible securities, warrants, options and derivatives of the Company during the Relevant Period.

4. SHAREHOLDINGS AND DEALINGS IN SECURITIES OF THE COMPANY AND ARRANGEMENTS IN RELATION TO DEALINGS

(a) As at the Latest Practicable Date, no arrangement of the kind referred to in the third paragraph of Note 8 to Rule 22 of the Takeovers Code existed between SJI (HK), its ultimate beneficial owner and their respective associates and parties acting in concert with them and any other person.
(b) China Way irrevocably undertook (i) not to accept the Share Offer in respect of 111,396,000 Shares retained by it; and (ii) not to dispose any of those retained Shares until the close of the Offers and there are no circumstances in which the irrevocable undertaking will cease to be binding. As at the Latest Practicable Date, except for the aforesaid irrevocable undertaking given by China Way, no person had irrevocably committed himself to accept or not to accept the Offers, and no such person had dealt in the Shares or any convertible securities, warrants, options or derivatives issued by the Company during the Relevant Period.
(c) As at the Latest Practicable Date, no shareholdings in the Company was owned or controlled by a person with whom SJI (HK) or any person acting in concert with it had any arrangement of the kind referred to in Note 8 to Rule 22 of the Takeovers Code, and no such person had dealt in the Shares or any convertible securities, warrants, options or derivatives issued by the Company during the Relevant Period.
(d) During the Relevant Period and as at the Latest Practicable Date, neither SJI (HK) nor any parties acting in concert with it has borrowed or lent any Shares or other securities of the Company carrying voting rights, or convertible securities, warrants, options or derivatives of the Company.

5. MISCELLANEOUS

As at the Latest Practicable Date,

(a) there was no agreement, arrangement or understanding (including any compensation arrangement) between SJI (HK), any person acting in concert with it and any Director, recent Director, Shareholder or recent Shareholder which had any connection with or dependent upon the Offers;

GENERAL INFORMATION

APPENDIX II

(b) save for the Agreement, no material contracts had been entered into by SJI (HK) in which any Director has a material personal interest;
(c) there was no agreement or arrangement to which SJI (HK) is a party which relate to the circumstances in which it may or may not invoke or seek to invoke a condition to the Offers;
(d) the Offeror shall deposit the Sale Shares and all the Offer Shares acquired by it to a designated account with Haitong Securities to secure the Facility before the final closing date of Offers.

Save as disclosed, there is no agreement, arrangement or understanding that the securities acquired in pursuance of the Offers would be transferred, charged or pledged to any other persons;

(e) should the Offeror utilize the Facility for the Offers, the Offeror intends to repay with its internal resources and such repayment will not depend to any significant extent on the business of the Company;
(f) save for the acquisition of the Sale Shares by SJI (HK), there is no arrangement (whether by way of option, indemnity or otherwise) in relation to the shares of SJI (HK) or the Shares which might be material to the Offers; and
(g) there was no benefit (other than statutory compensation) had been given to any Director as compensation for loss of office or otherwise in connection with the Offers.

6. EXPERT AND CONSENT

The following is the qualification of the expert whose letter/opinion is contained in this Document:

Name Qualification

Haitong International a licensed corporation under the Securities and Futures Ordinance Securities Company Limited (Chapter 571 of the Laws of Hong Kong) permitted to engage in type 1 (dealing in securities), type 3 (leveraged foreign exchange trading) and type 4 (advising on securities) regulated activities

Haitong Securities has given and has not withdrawn its written consent to the issue of this Document with copy of its letter and the references to its name included herein in the form and context in which they are respectively included.

GENERAL INFORMATION

APPENDIX II

7. GENERAL

(a) The registered office of SJI (HK) is situated at 3806, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong. As at the Latest Practicable Date, the entire issued share capital of SJI (HK) is held by SJ Asia Pacific Limited, the registered office of which is situated at Trident Chambers, P.O. Box 146, Road Town Tortola, British Virgin Islands and its entire issue share capital is held by SJI Inc., with registered office situated at 4-12-8 Higashi Shinagawa, Shinagawa-Ku, Tokyo, Japan, PO140-0002. As at the Latest Practicable Date, the directors of SJI Inc. are Mr. Li Jian, Mr. Kotoi Hirofumi, Mr. Yutaka Kimura, Mr. Koji Tsujikawa, Mr. Guo Wei, Mr. He Wenchao, Mr. Wang Yuan Yao, Mr. Toru Kashima and Mr. Yoshiaki Yabuki and the directors of SJI (HK) are Mr. Li Jian, Mr. Tano Daichi and Mr. Kotoi Hirofumi.
(b) The registered address of Haitong Securities is 25th Floor, New World Tower, 16-18 Queen’s Road Central, Hong Kong.
(c) The English text of this Document and the Form(s) of Acceptance shall prevail over their respective Chinese text for the purpose of interpretations.

8. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection (i) during normal business hours from 9:00 a.m. to 5:00 p.m. (other than Saturdays, Sundays and public holidays) at the head office and principal place of business of the Company in Hong Kong at Unit 1601, 16/F Shui On Centre, 6-8 Harbour Road, Wanchai, Hong Kong; (ii) on the website of the Securities and Futures Commission (www.sfc.hk); and (iii) the Company’s website at www.sinocom.cn during the period from 11 June 2012 onwards for as long as the Offers remain open for acceptance:

(a) the memorandum and articles of association of SJI (HK);
(b) the irrevocable commitment by China Way in not accepting the Share Offer;
(c) the letter from Haitong Securities as set out on pages 6 to 15 of this Document; and
(d) the written consent referred to in the paragraph headed “Expert and Consent” in this appendix II.

AI assistant

Glory Sun Land Group Limited — M&A Activity 2012

49106_rns_2012-06-10_b0c70a1a-6e01-45c4-a438-254291cd5010.pdf

SJI (HONG KONG) LIMITED

Financial adviser to SJI (Hong Kong) Limited

Haitong International Capital Limited

CONTENTS

EXPECTED TIMETABLE

Notes:

EXPECTED TIMETABLE

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

LETTER FROM HAITONG SECURITIES

FOR THE CANCELLATION OF ALL OUTSTANDING SHARE OPTIONS

INTRODUCTION

LETTER FROM HAITONG SECURITIES

THE OFFERS

Principal terms of the Offers

Comparison of value

LETTER FROM HAITONG SECURITIES

Highest and lowest Share prices

Value of the Offers

LETTER FROM HAITONG SECURITIES

Financial resources available to the Offeror

Condition of the Offers

Dealing and interests in the Company’s securities

LETTER FROM HAITONG SECURITIES

Stamp duty

Payment

Effect of accepting the Offers

Other arrangements

LETTER FROM HAITONG SECURITIES

Overseas Shareholders and overseas Optionholders

SHAREHOLDING STRUCTURE

INFORMATION ON THE OFFEROR

LETTER FROM HAITONG SECURITIES

OFFEROR’S INTENTION WITH RESPECT TO THE GROUP

PROPOSED CHANGE OF BOARD COMPOSITION

Executive Directors

LETTER FROM HAITONG SECURITIES

Independent non-executive Directors

MAINTAINING THE LISTING STATUS OF THE COMPANY

LETTER FROM HAITONG SECURITIES

COMPULSORY ACQUISITION

FURTHER TERMS OF THE OFFERS

GENERAL

LETTER FROM HAITONG SECURITIES

ADDITIONAL INFORMATION

1. PROCEDURES FOR ACCEPTANCE

1.1 The Share Offer

APPENDIX I

FURTHER TERMS AND PROCEDURES OF ACCEPTANCE OF THE OFFERS

APPENDIX I

1.2 The Option Offer

3. ANNOUNCEMENTS

4. RIGHT OF WITHDRAWAL

5. SETTLEMENT OF THE OFFERS

(a) The Share Offer

APPENDIX I

(b) The Option Offer

6. OVERSEAS SHAREHOLDERS AND OVERSEAS OPTIONHOLDERS

7. GENERAL

APPENDIX I

1. RESPONSIBILITY STATEMENT

2. MARKET PRICES

3. DISCLOSURE OF INTERESTS OF SJI(HK) AND ITS DIRECTORS

4. SHAREHOLDINGS AND DEALINGS IN SECURITIES OF THE COMPANY AND ARRANGEMENTS IN RELATION TO DEALINGS

5. MISCELLANEOUS

6. EXPERT AND CONSENT

Name Qualification

7. GENERAL

8. DOCUMENTS AVAILABLE FOR INSPECTION

More from Glory Sun Land Group Limited

Glory Sun Land Group Limited M&A Activity 2012