Qiniu Limited — Capital/Financing Update 2012

Dec 5, 2012

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.

SIBERIAN MINING GROUP COMPANY LIMITED 西伯利亞礦業集團有限公司 [*]

(incorporated in the Cayman Islands with limited liability)

(Stock code: 1142)

SUBSCRIPTION FOR NEW SHARES UNDER GENERAL MANDATE

THE SUBSCRIPTION

On 5 December 2012, after trading hours, the Company entered into a conditional Subscription Agreement with the Subscriber pursuant to which the Subscriber has conditionally agreed with the Company to subscribe for the Subscription Shares and the Company has conditionally agreed to allot and issue the Subscription Shares at a price of HK$0.250 per Subscription Share, subject to the terms and conditions contained therein.

The issue of the Subscription Shares is not subject to Shareholders’ approval as the Subscription Shares will be allotted and issued under the General Mandate. Pursuant to the Subscription Agreement, subject to the terms and conditions contained therein, a total of 70,000,000 new Shares will be allotted and issued by the Company to the Subscriber upon Completion, representing approximately 19.86% of the existing issued share capital of the Company of 352,442,763 Shares as at the date of this Announcement, and approximately 16.57% of the issued share capital of the Company as enlarged by the issue and allotment of the Subscription Shares immediately following Completion.

The Subscription Price of HK$0.250 per Subscription Share was negotiated and agreed at arm’s length between the Company and the Subscriber with reference to the recent trading price of the Shares immediately prior to the date of the Subscription Agreement, representing: (i) a discount of approximately 3.85% to the closing price of HK$0.260 per Share as quoted on the Stock Exchange on the Last Trading Date; (ii) a discount of approximately 15.82% to the average closing price of HK$0.297 per Share for the five consecutive trading days immediately prior to the date of this Announcement; and (iii) a discount of approximately 21.63% to the average closing price of HK$0.319 per Share for the ten consecutive trading days immediately prior to the date of this Announcement.

To the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the Subscriber is an Independent Third Party as of the date of this Announcement and prior to Completion. Upon Completion, the Subscriber will become a substantial shareholder and a connected person of the Company (both as defined under the Listing Rules).

Completion of the Subscription is conditional upon the conditions set out in the section headed “Conditions and Completion of the Subscription Agreement” of this Announcement.

* For identification purpose only

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The gross and the net proceeds (net of any expenses to be borne by the Company) from the Subscription will be approximately HK$17,500,000 and approximately HK$17,150,000, respectively. The net proceeds will be used by the Company as general working capital of the Group and repayment of liabilities. The net Subscription Price will be approximately HK$0.245 per each Subscription Share.

Completion of the Subscription is subject to the satisfaction of the conditions precedent in the Subscription. As the Subscription may or may not proceed, Shareholders and potential investors are advised to exercise caution when dealing in the Shares.

THE SUBSCRIPTION AGREEMENT

On 5 December 2012, after trading hours, the Company entered into a conditional Subscription Agreement with the Subscriber pursuant to which the Subscriber has conditionally agreed with the Company to subscribe for the Subscription Shares and the Company has conditionally agreed to allot and issue the Subscription Shares at a price of HK$0.250 per Subscription Share, subject to the terms and conditions contained therein.

SUBSCRIPTION AGREEMENT

Date: 5 December 2012 (after trading hours)

Parties:

Issuer : The Company Subscriber : The Subscriber

The Subscriber, a company incorporated under the laws of British Virgin Islands, and as advised by the Subscriber, is principally engaged in the business of investment holding. As advised by the directors of the Subscriber, the Subscriber is owned beneficially and ultimately by two natural persons, with Miss Pang Sum Fung and Mr. Teng Kui Ming holding approximately 77.27% and approximately 22.73%, respectively, of the shareholding of the Subscriber.

To the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the Subscriber and its ultimate beneficial owner(s) are Independent Third Party as of the date of this Announcement and prior to Completion. Upon Completion, the Subscriber will become a substantial shareholder and a connected person of the Company (both as defined under the Listing Rules).

To the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the Subscriber and its respective ultimate beneficial owner(s) do not hold any Shares as at the date of this Announcement.

The Subscription Agreement has not provided any terms entitling the Subscriber to nominate any person as Director.

Subscription Shares

Pursuant to the Subscription Agreement, subject to the terms and conditions contained therein, a total of 70,000,000 new Shares will be allotted and issued by the Company to the Subscriber upon Completion, representing approximately 19.86% of the existing issued share capital of the Company of 352,442,763 Shares as at the date of this Announcement, and approximately 16.57% of the issued share capital of the Company as enlarged by the issue and allotment of the Subscription Shares immediately following Completion.

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Each of the Subscription Shares, upon issue, will rank pari passu in all respects among themselves and with the existing issued Shares on the date of allotment and issue of the Subscription Shares and will be free from any encumbrance.

The aggregate nominal value of the Subscription Shares is HK$14,000,000.

General Mandate to Issue the Subscription Shares

The issue of the Subscription Shares is not subject to Shareholders’ approval as the Subscription Shares will be allotted and issued under the General Mandate. Each of the Subscription Shares will be issued under the General Mandate granted to the Directors at the annual general meeting of the Company held on 31 August 2012, of which the Directors are empowered to allot and issue up to 70,488,552 Shares, being 20% of the issued share capital of the Company as at the date of the said annual general meeting of the Company. Since the date the General Mandate was granted (i.e. 31 August 2012) and up to the date of this Announcement, no new Shares has been issued under the General Mandate. The Subscription Shares to be allotted and issued will utilize approximately 99.31% of the General Mandate. Since the Subscription Shares will be allotted and issued under the General Mandate, no Shareholders’ approval is required. The Company has not repurchased any Shares within the last 30 days prior to the date of this Announcement.

Subscription Price

The Subscription Price of HK$0.250 per Subscription Share was negotiated and agreed at arm’s length between the Company and the Subscriber with reference to the recent trading price of the Shares immediately prior to the date of the Subscription Agreement, representing:

• (i) a discount of approximately 3.85% to the closing price of HK$0.260 per Share as quoted on the Stock Exchange on the Last Trading Date;

• (ii) a discount of approximately 15.82% to the average closing price of HK$0.297 per Share for the five consecutive trading days immediately prior to the date of this Announcement; and

• (iii) a discount of approximately 21.63% to the average closing price of HK$0.319 per Share for the ten consecutive trading days immediately prior to the date of this Announcement.

The Subscriber has made Short Term Loans to the Company and as at the date of this Announcement, the total outstanding loan amount is HK$22,000,000 and the related Accrued Interests amounted to approximately HK$676,164. At the request of the Subscriber, the Company and the Subscriber have agreed that part of the Total Subscription Price will be settled by setting off the Discharged Amount on a dollar-to-dollar basis. Upon Completion and after setting off the Discharged Amount, the total outstanding loan amount of the Short Term Loans due by the Company to the Subscriber will be reduced from HK$22,000,000 to HK$11,500,000.

The Subscription Price of HK$0.250 for each of the Subscription Shares less the Discharged Amount per Subscription Share of approximately HK$0.150 will be paid in cash by the Subscriber on or before the Remittance Date for the Subscription Shares as one of the conditions precedent to be fulfilled which are further described in the paragraph headed “Conditions and Completion of the Subscription Agreement” below.

The Board considers the Subscription Price and the terms and conditions of the Subscription Agreement are fair and reasonable and the Subscription Agreement is in the interests of the Company and its Shareholders as a whole.

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The Subscriber shall bear its costs and expenses in connection with the Subscription, and the Company will bear its legal and any other fees in the aggregate amount of approximately HK$350,000. No fee shall be payable by the Company to the Subscriber upon Completion.

Conditions and Completion of the Subscription Agreement

Completion of the Subscription is conditional upon the fulfillment of all the following conditions:—

• (i) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the Subscription Shares;

• (ii) if applicable, the Company having obtained all consents and approval from the relevant authorities in respect of the transactions contemplated under the Subscription Agreement; and

• (iii) the Subscriber having deposited the Net Remittance for the Subscription Price with the Company on or before the Remittance Date to the Company’s designated bank account.

In the event that the conditions are not fulfilled or waived (only in respect of the foregoing condition (iii) by the Company) by 5:00 p.m. (Hong Kong time) on 9 January 2013 (or such other time and/or date as may be agreed between the Company and the Subscriber), all rights, obligations and liabilities of the parties to the Subscription Agreement shall cease and terminate accordingly and neither parties shall have any claims against the other.

In the event that the foregoing condition (iii) is fulfilled by the Subscriber but the Subscription Agreement shall cease and determine if the other conditions are not fulfilled, the Company shall refund the Net Remittance (without interest) to the Subscriber within five (5) Business Days upon such termination, and no setting off of the Discharged Amount will be taken place.

The Subscriber undertakes to indemnify and keep indemnified the Company on a full indemnity basis, from and against all loss, costs (including reasonable legal costs and other professional fees), expenses, claims, damages and liabilities which the Company may reasonably incur or suffer as a result of any breach of any of the terms and conditions contained in the Agreement by the Subscriber.

Completion will take place on the date falling on the fourth Business Day from the date on which all the conditions in respect of the Subscription under the Subscription Agreement are fulfilled or at such other date as may be agreed between the parties, at which the Subscriber will issue a written confirmation to the Company confirming that the Discharged Amount and the Net Remittance for the Subscription Shares deposited with the Company’s bank account be applied for subscribing the Subscription Shares and the Company will issue and allot the Subscription Shares to the Subscriber, and the Subscriber will subscribe for the Subscription Shares.

Completion of the Subscription is subject to the satisfaction of the conditions precedent in the Subscription. As the Subscription may or may not proceed, Shareholders and potential investors are advised to exercise caution when dealing in the Shares.

APPLICATION FOR LISTING

An application will be made by the Company to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Subscription Shares.

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REASONS FOR THE SUBSCRIPTION

The principal activity of the Company is investment holding. The Group is principally engaged in the businesses of coal mining, and mineral resources and commodities trading. The Directors consider that the Subscription will increase the capital base of the Company, provide funding for the general working capital of the Group and assist in reducing liabilities of the Group. Furthermore, the Subscription serves to convert part of the outstanding principal of the Short Term Loan into equity capital of the Company and, therefore, can reduce the amount of borrowings of the Group and improve its working capital position in an efficient and effective manner. The Directors are of the opinion that it is in the interest of the Company to preserve as much liquidity as possible in order to strengthen the Group’s financial position and secure a sustainable business growth.

Having considered the above, the Board considers that the Subscription Agreement is in the interests of the Group and its Shareholders as a whole.

USE OF PROCEEDS AND FUND RAISING WITHIN THE PAST TWELVE MONTHS

The gross and the net proceeds (net of any expenses to be borne by the Company) from the Subscription will be approximately HK$17,500,000 and approximately HK$17,150,000, respectively. The net proceeds will be used by the Company as general working capital of the Group and repayment of liabilities. The net Subscription Price will be approximately HK$0.245 per each Subscription Share.

Fund raising activities in the past twelve months

			Intended use of
			proceeds as
Date of			stated in the	Actual use of
announcement	Event	Net proceeds	announcement	proceeds/Remarks
11 January 2012	Subscription of	Approximately	General working	All proceeds had been
	21,300,000 new	HK$4.9 million	capital of the	used as intended as
	Shares under		Group and	general working
	general mandate		repayment of	capital of the Group in
			liabilities	the amount of
				approximately HK$2
				million and for
				repayment of
				liabilities of the
				Company in the
				amount of
				approximately
				HK$2.9 million
6 March 2012	Subscription of	Approximately	Full and final	Full and final
	124,072,110 new	US$8.95 million	discharge of the	discharge of the
	Shares	(approximately	Promissory Notes	Promissory Notes for
		HK$69.81 million)	for a total amount	a total amount of
			of US$9 million	US$9 million
			(approximately	(approximately
			HK$70.2 million)	HK$70.2 million)

Save as disclosed above, the Company has not conducted any fund raising activity in the previous 12 months immediately preceding the date of this Announcement.

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CHANGES IN SHAREHOLDING IN THE COMPANY

The shareholding structure of the Company immediately before and after Completion is as follows:

Name of Shareholder Goldwyn Management Limited_(Note 1)_ Pang Ngoi Wah Edward, a non-executive Director Sub-total Subscriber Income Plus Investment Limited Master Impact Inc. Skyline Merit Limited Other public Shareholders Sub-total Total	Shareholding immediately before Completion No. of Shares % (approx.) 11,400,000 3.24% 175,000 0.05% 11,575,000 3.29% — 0.00% 20,678,685 5.87% 62,036,055 17.60% 41,357,370 11.73% 216,795,653 61.51% 340,867,763 96.71% 352,442,763 100.00%	Shareholding immediately after the Completion No. of Shares % (approx.) 11,400,000 2.70% 175,000 0.04% 11,575,000 2.74% 70,000,000 16.57% 20,678,685 4.90% 62,036,055 14.68% 41,357,370 9.79% 216,795,653 51.32% 410,867,763 97.26% 422,442,763 100.0%	Shareholding immediately after the Completion No. of Shares % (approx.) 11,400,000 2.70% 175,000 0.04% 11,575,000 2.74% 70,000,000 16.57% 20,678,685 4.90% 62,036,055 14.68% 41,357,370 9.79% 216,795,653 51.32% 410,867,763 97.26% 422,442,763 100.0%
			2.74%
			16.57% 4.90% 14.68% 9.79% 51.32%
			97.26%
			100.0%

Note:

1. Goldwyn Management Limited is wholly and beneficially owned by Mr. Lim Ho Sok, an executive Director and the Chairman of the Company.

DEFINITIONS

Unless the context otherwise requires, the terms used in this Announcement have the following meaning:

“Accrued Interests”

the outstanding accrued interests payable on the Short Term Loans by the Company to the Subscriber amounted to approximately HK$676,164 in total as at the date of the Subscription Agreement

• “Announcement”

this announcement of the Company in relation to the Subscription

• “Business Day”

means a day (other than a Saturday and a day on which a tropical cyclone warning no.8 or above is hoisted or remains hoisted between 9:00 a.m. and 12:00 noon and is not lowered at or before 12:00 noon or on which a “black” rainstorm warning signal is hoisted or remains in effect between 9:00 a.m. and 12:00 noon and is not discontinued at or before 12:00 noon) on which banks in Hong Kong are generally open for business

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“Company”	Siberian Mining Group Company Limited, a company incorporated in the
	Cayman Islands with limited liability and the Shares of which are listed on
	the Stock Exchange
“Board”	board of Directors
“Completion”	Completion of the Subscription
“Directors”	directors of the Company
“Discharged Amount”	the amount of HK$10,500,000 to be set off with the same equivalent principal
	loan amount in relation to the HK$15,000,000 loan granted by the Subscriber
	to the Company pursuant to the loan agreement dated 31 July 2012
“General Mandate”	the general mandate which was granted to the Directors pursuant to an
	ordinary resolution passed at the annual general meeting of the Company
	on 31 August 2012 for the issue and allotment of up to 70,488,552 new
	Shares, representing 20% of the aggregate nominal amount of the share
	capital of the Company in issue on the date thereof
“Group”	the Company and its subsidiaries
“HK$” or “HK dollars”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	Hong Kong Special Administrative Region of the People’s Republic of China
“Independent Third Party”	third party or parties and their ultimate beneficial shareholder(s), which, to
	the best of the Directors’ knowledge, information and belief having made
	all reasonable enquiries, are independent of the Company and its connected
	persons (as defined in the Listing Rules)
“Last Trading Date”	5 December 2012, being the last trading day for the Shares prior to the issue
	of this Announcement and the entering into of the Subscription Agreement
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange
“Net Remittance”	the net amount, being HK$7,000,000, to be paid by the Subscriber after
	setting off the Discharged Amount against the Total Subscription Price on a
	dollar-to-dollar basis
“Remittance Date”	12 December 2012 or such other date as the Company and the Subscriber
	may agree
“Shares”	ordinary shares of HK$0.20 each in the share capital of the Company
“Shareholder(s)”	holder(s) of Shares

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“Short Term Loans”

collectively the following three unsecured short term loans advanced by the Subscriber to the Company, which are still outstanding as at the date of the Subscription Agreement:—

• (i) Pursuant to the loan agreement dated 31 July 2012, HK$15,000,000 was advanced by the Subscriber to the Company, which is repayable 12 months from the drawdown date and bearing an interest of 10% p.a. with interests payable in arrear every 6 months from the drawdown date. The loan of HK$15,000,000 was drawdown on 31 July 2012.

• (ii) Pursuant to the loan agreement dated 4 September 2012, HK$4,000,000 was advanced by the Subscriber to the Company, which is repayable 12 months from the drawdown date and bearing an interest of 10% p.a. with interests payable in arrear every 6 months from the drawdown date. The loan amounts of HK$3,000,000 and HK$1,000,000 were drawdown on 4 September 2012 and 14 September 2012, respectively.

• (iii) Pursuant to the loan agreement dated 5 October 2012, HK$3,000,000 was advanced by the Subscriber to the Company, which is repayable 12 months from the drawdown date and bearing an interest of 10% p.a. with interests payable in arrear every 6 months from the drawdown date. The loan of HK$3,000,000 was drawdown on 5 October 2012.

To secure the above three unsecured loans of the Company, Cordia Global Limited, a connected party to the Company, has pledged as security to the Subscriber its promissory notes issued by the Company for an amount of approximately US$7,251,000 (approximately HK$56,558,000) and its loans due by the Company for an amount of US$2,000,000 (approximately HK$15,600,000).

“Stock Exchange”

• “Subscriber”

• “Subscription”

• “Subscription Agreement”

• “Subscription Price”

The Stock Exchange of Hong Kong Limited

ACME Perfect Limited, a company incorporated under the laws of British Virgin Islands, the subscriber of the Subscription Shares under the Subscription Agreement

• the issue and allotment of the Subscription Shares to the Subscriber by the Company and the subscription by the Subscriber for the Subscription Shares on the terms and subject to the conditions set out in the Subscription Agreement

the subscription agreement entered into between the Company and the Subscriber dated 5 December 2012 in relation to the Subscription

the price of HK$0.250 for subscribing each Subscription Share

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“Subscription Shares”

• a total of 70,000,000 new Shares to be allotted and issued by the Company to the Subscriber pursuant to the Subscription Agreement representing approximately 19.86% of the existing issued share capital of the Company of 352,442,763 Shares as at the date of this Announcement, and approximately 16.57% of the issued share capital of the Company as enlarged by the issue and allotment of the Subscription Shares issued upon Completion

• “Total Subscription Price”

• the total Subscription Price of HK$17,500,000 payable by the Subscriber for the Subscription Shares

• “US$” or “US dollars” the United States of America dollars, the lawful currency of the United States of America

“%”

per cent.

In this Announcement, for illustration purposes only, unless otherwise stated, the conversion of US dollars into HK dollars is based on the approximate exchange rate of US$1.00 to HK$7.80.

By Order of the Board Siberian Mining Group Company Limited Lim Ho Sok Chairman

Hong Kong, 5 December 2012

As at the date of this announcement, the Board consists of Mr. Lim Ho Sok and Mr. Choi Jun Ho as executive directors, Mr. Pang Ngoi Wah Edward as non-executive director, and Mr. Cho Min Je, Mr. Liew Swee Yean, Mr. Tam Tak Wah and Mr. Young Yue Wing Alvin as independent non-executive directors.

This announcement will remain on the website of The Stock Exchange of Hong Kong Limited at www.hkexnews.hk on the “Latest Listed Company Information” page for at least 7 days from the date of its posting and on the Company’s website at http://siberian.todayir.com.

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