Hephaestus Holdings Limited — M&A Activity 2014

Jun 20, 2014

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

PAN ASIA MINING LIMITED 宴亚礦業有限公司

(Incorporated in the Cayman Islands with limited liability) (Stock code: 8173)

VOLUNTARY ANNOUNCEMENT

NO ADJUSTMENT TO CONSIDERATION OF
DISCLOSEABLE AND CONNECTED TRANSACTION
INVOLVING ISSUE OF CONSIDERATION SHARES
UNDER SPECIFIC MANDATE

References are made the announcements of Pan Asia Mining Limited (the "Company") dated 27 March 2013, 22 April 2013, 10 May 2013 and 31 May 2013 respectively and the circular of the Company dated 10 May 2013 (the "Circular") in relation to a discloseable and connected transaction involving issue of consideration shares under specific mandate. Unless otherwise defined herein, capitalised terms used herein shall have the same meanings as those defined in the Circular.

As disclosed in the Circular, the Company, the Purchaser, the Vendor and the Vendor's Guarantor had entered into the Sale and Purchase Agreement dated 27 March 2013 (as amended by a supplemental agreement dated 10 May 2013). Pursuant to the Sale and Purchase Agreement, the Purchaser, a wholly-owned subsidiary of the Company, has conditionally agreed to purchase and the Vendor has conditionally agreed to sell the Sale Share, representing the entire issued share capital of the Target Company, at the Consideration of HK$50,050,000 (subject to Adjustment) to be fully satisfied by issue of 91,000,000 Consideration Shares at issue price of HK$0.55 each. The Sale and Purchase Agreement was completed on 31 May 2013 and 24,715,000 Consideration Shares were issued & allotted according to terms of the Sales and Purchase Agreement.

Pursuant to the Sale and Purchase Agreement, the formula of Adjustment is as follows:

(a) in the event that the Profit of the Target Group for the Guaranteed Period is not less than HK$3,700,000, the Consideration shall be HK$50,050,000;
(b) in the event that the Profit of the Target Group for the Guaranteed Period is more than HK$1,000,000 but less than HK$3,700,000, the Consideration shall be reduced by HK$1,350,250 per HK$100,000 shortfall from HK$3,700,000. Any shortfall less than HK$100,000 will be rounded up to HK$100,000; and

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(c) in the event that the Profit of the Target Group for the Guaranteed Period is HK$1,000,000 or less, the Consideration shall be adjusted to HK$13,593,250.

To ascertain the Profit of the Target Group in the Guaranteed Period (i.e. the period from 1 April 2013 to 31 March 2014), the Target Group Audited Accounts for the Guaranteed Period would be prepared and issued by the auditors appointed by the Company in accordance with the accounting principles and practices generally accepted in Hong Kong within three months after the expiry of the Guaranteed Period (or such reasonably extended date as the Purchaser and the Company may agree).

The Board announces that as confirmed by the auditors appointed by the Company, the Profit of the Target Group for the Guaranteed Period exceeded HK$3,700,000 and therefore, total Consideration for the Sale Shares remains HK$50,050,000. The Company will issue and allot the remaining 66,285,000 Consideration Shares according to terms of the Sale and Purchase Agreement.

By order of the Board
Pan Asia Mining Limited
Koh Tat Lee, Michael
Chairman

Hong Kong, 20 June 2014

As of the date of this announcement, the Board comprises three executive Directors, Mr. KOH Tat Lee, Michael, Mr. ENG Wee Meng and Mr. CHEUNG Hung Man, two non-executive Directors, Mr. YIN Mark Teh-min and Mr. LIANG Tong Wei, and three independent non-executive Directors, Mr. LAI Kai Jin, Michael, Mr. CHU Hung Lin, Victor and Mr. TONG Wan Sze.

This announcement, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief: (1) the information contained in this announcement is accurate and complete in all material respects and not misleading; (2) there are no other matters the omission of which would make any statement in this announcement misleading and (3) all opinions expressed in this announcement have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable.

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

This announcement will remain on the page of "Latest Company Announcement" on the GEM website for at least seven days from the date of its posting.