Hephaestus Holdings Limited — Proxy Solicitation & Information Statement 2014

Dec 21, 2014

PAN ASIA MINING LIMITED 真亞礦業有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8173)

PROXY FORM

Form of proxy for use at the Extraordinary General Meeting to be held on Friday, 9 January 2015 at 11:00 a.m. (or at any adjournment thereof)

I/We, (Note 1)

of

being the registered holder(s) of (Note 2) ________ shares of HK$0.50 each in capital of Pan Asia Mining Limited (the "Company"), hereby appoint (Note 3) the chairman of the Meeting (as defined below) or ________ of

or failing him, __________ of

to act as my/our proxy to attend and vote for me/us and on my/our behalf at the extraordinary general meeting of the Company to be held at Units 3404-6, 34/F, AIA Tower, 183 Electric Road, North Point, Hong Kong, on Friday, 9 January 2015 at 11:00 a.m., or at any adjournment thereof (the "Meeting") on the undermentioned resolutions as indicated below or, if no such indication is given, as my/our proxy or proxies think(s) fit. My/our proxy will also be entitled to vote at his/her discretion on any resolution properly put to the Meeting other than the undermentioned resolutions:

	ORDINARY RESOLUTIONS	FOR (Note 4)	AGAINST (Note 4)
1.	(a) To approve the authorised share capital of the Company to be increased from HK$1,000,000,000 to HK$2,500,000,000 (the "Share Capital Increase") by the creation of an additional 3,000,000,000 ordinary shares of par value of HK$0.5 each in the capital of the Company and such shares shall rank pari passu with all existing shares of the Company.
	(b) To authorise any one director of the Company (the "Director") for and on behalf of the Company to execute all such documents and instruments and to do all such acts or things deemed by him to be incidental to, ancillary to or in connection with the matters contemplated in and to give effect to the Share Capital Increase.
2.	(a) To approve the Rights Issues and Bonus Issue as defined in the circular dated 19 December 2014 of the Company (the "Circular").
	(b) To authorise any one or more Directors to do all such acts and things, to sign and execute all such further documents and to take such steps as he/she/they may in his/her/their absolute discretion consider necessary, appropriate, desirable or expedient to carry out or to give effect to or in connection with the Rights Issue or any transactions contemplated thereunder.
3.	(a) To generally and unconditionally approve, ratify and confirm the conditional bond restructuring agreement (the "Bond Restructuring Agreement") dated 22 September 2014 (as amended by a supplemental agreement on 21 November 2014) and entered into among the Company and Kesterion Investments Limited ("Kesterion") pursuant to which it is conditionally agreed that (i) the terms of Convertible Bonds (as defined in the Circular) will be amended to grant the Company a right to redeem all the outstanding Convertible Bonds at a redemption price of US$140,000,000 (equivalent to approximately HK$1,092,000,000), (ii) the Company will exercise such Redemption Right (as defined in the Circular) and (iii) in satisfaction and cancellation of the Redemption Amount (as defined in the Circular) payable under the amended Convertible Bonds following such redemption, the Company will issue the New Bonds (as defined in the circular) to Kesterion and the performance of all the transactions contemplated thereunder and all other matters of and incidental thereto or in connection therewith.
	(b) To authorise any one or more of the Directors to do all such acts and things and execute all such other or further documents which he/they consider necessary, desirable or expedient for the purpose of, or in connection with, the implementation of and giving effect to the terms of, or the transactions contemplated by, the Bond Restructuring Agreement and all documents in connection therewith and to agree to such variation, amendments or waiver or matters relating thereto as are, in the opinion of the Directors, in the interest of the Company and its shareholders as a whole.

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	ORDINARY RESOLUTIONS	FOR (Note 4)	AGAINST (Note 4)
	(c) To approve the New Bond (as defined in the Circular) to be issued by the Company to be issued pursuant to the Bond Restructuring Agreement and the transactions contemplated thereunder.
	(d) To authorise any one or more of the Directors to allot and issue such number of Shares as may fall to be allotted and issued; (i) on and subject to the terms and conditions of the Bond Restructuring Agreement; and (ii) upon exercise of the conversion rights attached to the New Bonds on and subject to the terms and conditions of the Bond Restructuring Agreement and the conditions of the New Bonds.
4.	(a) To generally and unconditionally approve, ratify and confirm the settlement agreement (the “Settlement Agreement”) dated 21 November 2014 and entered into among the Company and Magic Stone Fund (China) (“Magic Stone”) pursuant to which, amongst others, the Group has conditionally agreed to settle the liabilities under the Trade Contracts (as defined in the Circular) by way of the following arrangements: (i) the Group shall pay Magic Stone RMB51.88 million (equivalent to approximately HK$64.85 million) in cash before 28 February 2015; (ii) the Group shall pay Magic Stone US$17 million (equivalent to approximately HK$132.6 million) in cash before 28 February 2015; and (iii) the Company shall issue and allot 80,000,000 new Shares each fully paid at an issue price of HK$0.50 per Share to Magic Stone after the completion of the Rights Issue and before 28 February 2015 and the performance of all the transactions contemplated thereunder and all other matters of and incidental thereto or in connection therewith.
	(b) To authorise any one or more of the Directors to do all such acts and things and execute all such other or further documents which he/they consider necessary, desirable or expedient for the purpose of, or in connection with, the implementation of and giving effect to the terms of, or the transactions contemplated by, the Settlement Agreement and all documents in connection therewith and to agree to such variation, amendments or waiver or matters relating thereto as are, in the opinion of the Directors, in the interest of the Company and its shareholders as a whole.

Dated the __ day of __

Signature (Note 5)

Notes:

(1) Full name(s) and address(es) to be inserted in BLOCK CAPITALS.

(2) Please insert the number of shares of the Company registered in your name(s). If a number is inserted, this form of proxy will be deemed to relate only to those shares. If no number is inserted, this form of proxy will be deemed to relate to all shares of the Company registered in your name(s).

(3) If any proxy other than the chairman of this meeting is preferred, please strike out "chairman of the Meeting (as defined below) or" and insert the name and address of the proxy desired in the space provided. Any alternation made to this form of proxy must be initialed by the person who signs it.

(4) Please indicate with an "X" in the appropriate space beside each of the resolutions how you wish the proxy to vote on your behalf on a poll. If this form is returned duly signed, but without any indication, the proxy will vote for or against the resolution or will abstain at his discretion. Your proxy will also be entitled to vote at his discretion on any resolution properly put to the Meeting other than those referred to in the notice convening the Meeting.

(5) This form of proxy must be signed by you or your attorney duly authorised in writing or, if the appointor is a corporation, must be either under its seal or under the hand of an officer, attorney or other person authorised to sign the same.

(6) In the case of joint holders the vote of the senior who tenders a vote whether in person or by proxy will be accepted to the exclusion of the votes of the other joint holders. For this purpose, seniority is determined by the order in which the names stand in the Register of Members of the Company in respect of the joint holding.

(7) To be valid, this form of proxy together with any power of attorney or other authority (if any) under which it is signed or a notarially certified copy of such power or authority must be delivered to the Company's share registrar in Hong Kong, Tricor Tengis Limited, at Level 22, Hopewell Centre, 183 Queen's Road East, Hong Kong not less than 48 hours before the time appointed for holding the Meeting or any adjourned meeting, and in default thereof this form of proxy shall not be treated as valid. No instrument appointing a proxy shall be valid after the expiry of 12 months from the date of its execution.

(8) A proxy need not be a shareholder of the Company but must attend the Meeting in person to represent you.

(9) Completion and deposit of the proxy form will not preclude you from attending and voting at the Meeting if you wish.