Hephaestus Holdings Limited — M&A Activity 2016

Apr 19, 2016

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 赛亞礦業有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8173)

MEMORANDUM OF UNDERSTANDING IN RELATION TO A PROPOSED ACQUISITION

This announcement is made by the Company pursuant to Rule 17.10 of the GEM Listing Rules and Inside Information Provisions under Part XIVA of the SFO.

The Board is pleased to announce that on 19 April 2016 (after trading hours), the Purchaser and the Vendor entered into the MOU in relation to the proposed acquisition of entire issued share capital in the Target subject to completion of the Proposed Restructuring.

To the best of the Directors' information and belief having made all reasonable enquiry, the Vendor is third party independent of the Company and its connected persons.

The Target is principally engaged in investment holding. Subject to the completion of the Proposed Restructuring, the Target Group will be principally engaged in the operation and management of Solar Power Plant, a ground-based solar power plant located in Liangcheng County, Inner Mongolia Autonomous Region, the PRC, with an expected aggregate installed power generating capacity of approximately 20MWp.

The consideration of the Proposed Acquisition will be determined by the Purchaser and the Vendor upon further negotiation. The Purchaser shall be entitled to carry out due diligence review of the assets, liabilities, business, financial, legal and other affairs of the Target Group.

Under the MOU, the Vendor shall not directly or indirectly negotiate or agree with any other party relating to the Proposed Acquisition or any possible disposal of any equity interest, assets or business undertaking of any members of the Target Group or do anything which is inconsistent with or undermine the commercial value of the Proposed Acquisition for a period of 3 months (the "Exclusive Period") from the date of the MOU.

The MOU shall be terminated upon (i) expiry of the Exclusive Period (unless otherwise extended by the parties in the MOU in writing); or (ii) entering into of the Formal Agreement; or (iii) the Purchaser giving 15 days prior notice in writing to the Vendor to terminate the Proposed Acquisition under the MOU, whichever is earlier.

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The MOU does not create legally binding obligations on the parties in relation to the Proposed Acquisition but is legally binding as to such terms relating to Exclusive Period, termination of the MOU and confidentiality. The Proposed Acquisition is subject to the negotiation and execution of the Formal Agreement.

The MOU is not legally binding with regard to the Proposed Acquisition, it may or may not proceed. Shareholders and investors are advised to exercise caution when dealing in the Shares. Should the Purchaser enter into the Formal Agreement or decide to terminate the MOU or there be any material development on the Proposed Acquisition, the Company will inform the Shareholders and investors by way of announcement(s) in accordance with the GEM Listing Rules as and when appropriate.

DEFINITIONS

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

"Board" the board of Directors

"Company" Pan Asia Mining Limited 寰亞礦業有限公司, a company incorporated in the Cayman Islands with limited liability, the issued shares of which are listed on GEM (Stock Code: 8173)

"connected persons" has the meaning ascribed to it under the GEM Listing Rules

"Director(s)" director(s) of the Company

"Formal Agreement" a formal sale and purchase agreement between the Purchaser and the Vendor in relation to the Proposed Acquisition

"GEM" The Growth Enterprise Market of the Stock Exchange

"GEM Listing Rules" the Rules Governing the Listing of Securities on GEM

"Hong Kong" the Hong Kong Special Administrative Region of the PRC

"MOU" the memorandum of understanding dated 19 April 2016 entered into between the Purchaser and the Vendor in relation to Proposed Acquisition

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“PRC” the People’s Republic of China which, for the purpose of this announcement, excludes Hong Kong, Taiwan and the Macau Special Administrative Region of the People’s Republic of China

“PRC Company” 內蒙古晶兆萊光伏電力有限公司 (Inner Mongolia Jing Zhao Lai Photovoltaic Company Limited*) a company incorporated in PRC which holds the Solar Power Plant

“Proposed Acquisition” the proposed acquisition of the entire issued share capital in the Target by the Purchaser from the Vendor as contemplated under the MOU

“Proposed Restructuring” the corporate restructuring of the Target, the successful implementation of which shall result in the Target directly or indirectly owning 100% of the equity interest of the PRC Company

“Purchaser” Allied Power Global Limited, a company incorporated in the British Virgin Islands with limited liability and a direct wholly-owned subsidiary of the Company

“SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

“Share(s)” ordinary share(s) of HK$0.08 each in the share capital of the Company

“Shareholder(s)” holder(s) of the Share(s)

“Solar Power Plant” a ground-based solar power plant located in Liangcheng Country, Inner Mongolia Autonomous Region, the PRC

“Stock Exchange” The Stock Exchange of Hong Kong Limited

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“Target”
a company incorporated in Hong Kong with limited liability, which will be directly or indirectly interested in the PRC Company after successful completion of the Proposed Restructuring

“Target Group”
the Target and its subsidiaries

“Vendor”
Ms. Hui Sai Ha, being the sole shareholder of the Target

By order of the Board
Pan Asia Mining Limited
Yip Man Yi
Chairman

Hong Kong, 19 April 2016

As at the date of this announcement, the Board comprises three executive Directors, Ms. Yip Man Yi, Mr. Cheung Hung Man and Mr. Shiu Chi Tak, Titus, two non-executive Directors, Mr. Liang Tongwei and Mr. Wong Chi Man, and six independent non-executive Directors, Mr. Chu Hung Lin, Victor, Mr. Tong Wan Sze, Mr. Fung Kwok Leung, Dr. Wan Ho Yuen, Terence, Mr. Li Kwok Chu and Mr. Lau Shu Yan.

This announcement, for which the Directors jointly and individually accept full responsibility, including the 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, the information in this announcement 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 herein or this announcement misleading.

This announcement will remain on the page of “Latest Company Announcement” on the GEM website for at least 7 days from the date of its posting and on the website of the Company www.pamining.com.

• For identification purpose only