Qiniu Limited — Capital/Financing Update 2012

Jun 26, 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)

PLACING OF CONVERTIBLE BONDS, SUPPLEMENTAL AGREEMENT TO PLACING AGREEMENT AND ISSUE OF SHARES UNDER NEW PLACING SPECIFIC MANDATE

(1) Supplemental Agreement

The Board announces that on 26 June 2012 (after trading hours), the Company and HANI have entered into the Supplemental Agreement pursuant to which the Company and HANI conditionally agreed to, inter alia, (i) extend the Placing Period; (ii) extend the dates for fulfillment of conditions precedent; and (iii) change the issue of the Convertible Bonds into two tranches.

Pursuant to the Supplemental Agreement, the Company has appointed the Placing Agent to procure Placees to subscribe for the Convertible Bonds to be issued in two tranches up to an aggregate principal amount of US$70,000,000 (approximately HK$546,000,000) on a best-effort basis, where Tranche 1 Bonds up to an aggregate principal amount of US$30,000,000 (approximately HK$234,000,000) and Tranche 2 Bonds up to an aggregate principal amount of US$40,000,000 (approximately HK$312,000,000).

The Conversion Shares falling to be allotted and issued upon exercise of the conversion rights attaching to the Convertible Bonds will be allotted and issued under the New Placing Specific Mandate to be sought at the Second EGM. The Convertible Bonds carries the right to convert into Conversion Shares at the conversion price of HK$0.52 per Conversion Share (subject to adjustment). Assuming all the Convertible Bonds are successfully placed by the Placing Agent and full conversion of the Tranche 1 Bonds and the Tranche 2 Bonds at the conversion price of HK$0.52 per Conversion Share, 1,050,000,000 Conversion Shares will fall to be issued to the Bondholders, representing approximately 297.92% of the issued capital of the Company as at the date of this announcement and approximately 74.87% of the issued share capital of the Company as enlarged by the issue and allotment of all the relevant Conversion Shares.

(2) General

Second EGM will be convened for the Shareholders to consider and, if thought fit, to pass the resolutions to approve the grant of the New Placing Specific Mandate and the execution of Supplemental Agreement. A circular will be despatched by the Company to the Shareholders on or before 12 July 2012, containing further details of the Supplemental Agreement and a notice of the Second EGM.

As the Placing Agreement as supplemented by the Supplemental Agreement may or may not complete, Shareholders and potential investors of the Company should exercise caution when dealing in the Shares or any other securities of the Company.

* For identification purpose only

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(1) THE SUPPLEMENTAL AGREEMENT

Reference is made to (A) the announcement dated 6 March 2012 (the “ Announcement ”) of Siberian Mining Group Company Limited (the “ Company ”) in relation to, inter alia, the Placing of Convertible Bonds and issue of Shares under Placing Specific Mandate; and (B) the circular of the Company dated 26 April 2012 (the “ Circular ”). Terms used in this announcement shall have the same meanings as those defined in the Announcement and the Circular unless otherwise stated herein.

The Board announces that on 26 June 2012 (after trading hours), the Company and HANI have entered into the Supplemental Agreement to the Placing Agreement (the “ Supplemental Agreement ”) pursuant to which the Company and HANI conditionally agreed to, inter alia, (i) extend the Placing Period; (ii) extend the dates for fulfillment of conditions precedent; and (iii) change the issue of the Convertible Bonds into two tranches. The Supplemental Agreement is conditional upon the Shareholders passing at an extraordinary general meeting of the Company the resolutions approving and ratifying the execution of the Supplemental Agreement.

Pursuant to the Supplemental Agreement, the Company has appointed the Placing Agent to procure Placees to subscribe for the Convertible Bonds to be issued in two tranches up to an aggregate principal amount of US$70,000,000 (approximately HK$546,000,000) on a best-effort basis, convertible bonds of up to an aggregate principal amount of US$30,000,000 (approximately HK$234,000,000) for the first tranche (“ Tranche 1 Bonds ”) and convertible bonds of up to an aggregate principal amount of US$40,000,000 (approximately HK$312,000,000) for the second tranche (“ Tranche 2 Bonds ”).

Conditions of the Placing

The obligations of HANI under the Placing Agreement as supplemented by the Supplemental Agreement in respect of the placing of the Tranche 1 Bonds shall be conditional upon the following:

• (a) the granting of the listing of and permission to deal in, up to 450,000,000 Shares falling to be issued on the exercise of the Conversion Rights attached to the Tranche 1 Bonds by the Listing Committee of the Stock Exchange; and

• (b) the Shareholders passing at an extraordinary general meeting of the Company the resolutions approving the issue of the Tranche 1 Bonds and the allotment and issue of up to 450,000,000 Shares falling to be issued on the exercise of the Conversion Rights attached to the Tranche 1 Bonds.

The obligations of HANI under the Placing Agreement in respect of the placing of the Tranche 2 Bonds shall be conditional upon the following:

• (a) the granting of the listing of and permission to deal in, up to 600,000,000 Shares falling to be issued on the exercise of the Conversion Rights attached to the Tranche 2 Bonds by the Listing Committee of the Stock Exchange; and

• (b) the Shareholders passing at an extraordinary general meeting of the Company the resolutions approving the issue of the Tranche 2 Bonds and the allotment and issue of up to 600,000,000 Shares falling to be issued on the exercise of the Conversion Rights attached to the Tranche 2 Bonds.

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If any of the conditions referred to in Tranche 1 Bonds or Tranche 2 Bonds, as the case may be, is not fulfilled (and none of the conditions can be waived) at or before 5:00 p.m. (Hong Kong time) on 28 September 2012 (in respect of Tranche 1 Bonds) or 30 October 2012 (in respect of Tranche 2 Bonds) or such later time or date as may be agreed between HANI and the Company in writing, the Company may at any time thereafter, terminate HANI’s obligations in respect of Tranche 1 Bonds and/or Tranche 2 Bonds (as the case may be) under the Placing Agreement by notice in writing to the HANI whereupon the Placing Agreement shall lapse and the Company and HANI shall not be bound to proceed with the Placing except for any antecedent breaches of the Placing Agreement.

The Directors consider the terms and conditions of the Supplemental Agreement are fair and reasonable based on the current market conditions and in the interests of the Company and Shareholders as a whole.

New Placing Specific Mandate to issue the Conversion Shares

The Conversion Shares falling to be allotted and issued upon exercise of the conversion rights attaching to the Convertible Bonds will be allotted and issued under a specific mandate (“ New Placing Specific Mandate ”), to be sought from the Shareholders at the second extraordinary general meeting (“ Second EGM ”), to (i) issue the Convertible Bonds in two tranches and (ii) allot and issue the new Shares which may fall to be allotted and issued upon exercise of the conversion rights attaching to the Convertible Bonds. The Convertible Bonds carries the right to convert into Conversion Shares at the conversion price of HK$0.52 per Conversion Share (subject to adjustment).

Assuming full conversion of the Tranche 1 Bonds, there will be up to 450,000,000 Shares falling to be allotted and issued upon exercise of the Conversion Rights attached to Tranche 1 Bonds. Assuming full conversion of the Tranche 2 Bonds, there will be up to another 600,000,000 Shares falling to be allotted and issued upon exercise of the Conversion Rights attached to Tranche 2 Bonds.

Assuming all the Convertible Bonds are successfully placed by the Placing Agent and full conversion of the Tranche 1 Bonds and the Tranche 2 Bonds at the conversion price of HK$0.52 per Conversion Share, 1,050,000,000 Conversion Shares will fall to be issued to the Bondholders, representing approximately 297.92% of the issued capital of the Company as at the date of this announcement and approximately 74.87% of the issued share capital of the Company as enlarged by the issue and allotment of all the relevant Conversion Shares.

The Principal Terms of the Convertible Bonds remain the same as disclosed in the Circular.

Reasons for entering into the Supplemental Agreement and use of proceeds

The reasons for entering into the Supplemental Agreement are as follows:

• (i) the global market sentiments have been changing and fluctuating and HANI requests more time for it to solicit good quality investors; and

• (ii) the issue of Convertible Bonds by two tranches will provide more flexibility to the Company and HANI.

Use of Proceeds

Assuming that the Supplemental Agreement is approved by the Shareholders and the entire two tranches, in aggregate principal amount of US$70,000,000 (approximately HK$546,000,000), of the Convertible Bonds are successfully placed by HANI, the total gross proceeds will amount to US$70,000,000 (approximately HK$546,000,000). The net proceeds (after deducting the fees and expenses involved in the Placing) will be approximately US$69,801,900 (approximately HK$544,454,820).

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The Group intends to apply the aforesaid aggregated net proceeds of Tranche 1 Bonds and Tranche 2 Bonds as follows:

1. Approximately US$10,000,000 (approximately HK$78,000,000) for financing the exploration drilling and geological and hydrological surveys of coal mines in Russia.

2. Approximately US$15,000,000 (approximately HK$117,000,000) for repayment of existing liabilities of the Group owed to Cordia, namely:

3. (a) shareholder’s loans in the sum of approximately US$2,000,000 (approximately HK$15,600,000) owed by Langfeld, which represented the advances to Langfeld from Cordia that presently holds 10% equity interest in Langfeld;

4. (b) promissory notes in the principal amount of US$9,251,000 (approximately HK$72,157,800) to be settled at US$8,000,000 (approximately HK$62,400,000) issued by the Company in favour of Cordia, the entire principal amount is outstanding as at the date of this circular; and

5. (c) loans of total amount of approximately US$5,000,000 (approximately HK$39,000,000) owed by the Company, which represented advances by Cordia to the Company for the purposes of working capital financing.

6. Approximately US$6,301,900 (approximately HK$49,154,820) for general working capital purposes.

7. Approximately US$38,500,000 (approximately HK$300,300,000) for possible acquisition of mining assets, which may consist of one or more mining assets, which represents the balancing amount.

Since the Placing will be on a best-effort basis, there is no guarantee that the proposed total of US$70,000,000 of the Convertible Bonds can be fully subscribed. If the final amount of the Convertible Bonds falls short of the proposed US$70,000,000, the aforesaid aggregated net proceeds of Tranche 1 Bonds and Tranche 2 Bonds will be applied to items 1 to 4 proportionately.

Use of Proceeds of Tranche 1 Bonds

Assuming only the Tranche 1 Bonds is successfully placed by HANI, the total gross proceeds of Tranche 1 Bonds will amount to US$30,000,000 (approximately HK$234,000,000). The net proceeds of Tranche 1 Bonds (after deducting the fees and expenses involved in the Placing) will be approximately US$29,801,900 (approximately HK$232,454,820).

The Group intends to apply the aforesaid net proceeds of Tranche 1 Bonds as follows:

1. Approximately US$4,269,510 (approximately HK$33,302,178) for financing the exploration drilling and geological and hydrological surveys of coal mines in Russia.

2. Approximately US$6,404,250 (approximately HK$49,953,150) for repayment of existing liabilities of the Group owed to Cordia, namely:

3. (a) shareholder’s loans in the sum of approximately US$853,914 (approximately HK$6,660,529) owed by Langfeld, which represented the advances to Langfeld from Cordia that presently holds 10% equity interest in Langfeld;

4. (b) promissory notes in the principal amount of US$3,960,953 (approximately HK$30,895,433) to be settled at US$3,415,596 (approximately HK$26,641,649) issued by the Company in favour of Cordia, the entire principal amount is outstanding as at the date of this circular; and

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• (c) loans of total amount of approximately US$2,134,740 (approximately HK$16,650,972) owed by the Company, which represented advances by Cordia to the Company for the purposes of working capital financing.

• Approximately US$2,690,574 (approximately HK$20,986,477) for general working capital purposes.

• Approximately US$16,437,566 (approximately HK$128,213,015) for possible acquisition of mining assets, which may consist of one or more mining assets, which represents the balancing amount.

Since the Placing will be on a best-effort basis, there is no guarantee that the proposed total of US$30,000,000 (approximately HK$234,000,000) of the Tranche 1 Bonds can be fully subscribed. If the final amount of the Tranche 1 Bonds falls short of the proposed US$30,000,000 (approximately HK$234,000,000), the aforesaid net proceeds of Tranche 1 Bonds will be applied to items 1 to 4 proportionately.

Use of Proceeds of Tranche 2 Bonds

Assuming only the Tranche 2 Bonds is successfully placed by HANI, the total gross proceeds of Tranche 2 Bonds will amount to US$40,000,000 (approximately HK$312,000,000). The net proceeds of Tranche 2 Bonds (after deducting the fees and expenses involved in the Placing) of Tranche 2 Bonds will be approximately US$39,801,900 (approximately HK$310,454,820).

The Group intends to apply the aforesaid net proceeds of Tranche 2 Bonds as follows:

1. Approximately US$5,702,140 (approximately HK$44,476,692) for financing the exploration drilling and geological and hydrological surveys of coal mines in Russia.

2. Approximately US$8,553,190 (approximately HK$66,714,882) for repayment of existing liabilities of the Group owed to Cordia, namely:

3. (a) shareholder’s loans in the sum of approximately US$1,140,444 (approximately HK$8,895,463) owed by Langfeld, which represented the advances to Langfeld from Cordia that presently holds 10% equity interest in Langfeld;

4. (b) promissory notes in the principal amount of US$5,290,047 (approximately HK$41,262,367) to be settled at US$4,561,696 (approximately HK$35,581,229) issued by the Company in favour of Cordia, the entire principal amount is outstanding as at the date of this circular; and

5. (c) loans of total amount of approximately US$2,851,050 (approximately HK$22,238,190) owed by the Company, which represented advances by Cordia to the Company for the purposes of working capital financing.

6. Approximately US$3,593,394 (approximately HK$28,028,473) for general working capital purposes.

7. Approximately US$21,953,176 (approximately HK$171,234,773) for possible acquisition of mining assets, which may consist of one or more mining assets, which represents the balancing amount.

Since the Placing will be on a best-effort basis, there is no guarantee that the proposed total of US$40,000,000 (approximately HK$312,000,000) of the Tranche 2 Bonds can be fully subscribed. If the final amount of the Tranche 2 Bonds falls short of the proposed US$40,000,000 (approximately HK$312,000,000), the aforesaid net proceeds of Tranche 2 Bonds will be applied to items 1 to 4 proportionately.

In the event the Company wishes to change the allocation of the net proceeds due to changes in the market environment, the Company will come up with a new plan and make the announcement accordingly.

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Shareholding Structure of the Company

As at the date of this announcement, the Company has 352,442,763 Shares in issue. The shareholding structure of the Company immediately before completion of the issue of the Conversion Shares and immediately after completion of the issue of the Conversion Shares will be as follows:

Shareholders Goldwyn Management Limited (Note 1) Pang Ngoi Wah Edward, a non-executive Director Sub-total Public Shareholders: The Placees Income Plus Investment Limited Master Impact Inc. Skyline Merit Limited Other public Shareholders Total	Existing shareholding (as at the date of this announcement) Number of Approximate Shares % 11,400,000 3.24% 175,000 0.05% 11,575,000 3.29% — — 20,678,685 5.87% 62,036,055 17.60% 41,357,370 11.73% 216,795,653 61.51% 352,442,763 100.00%	Shareholding immediately after the Placing, the issue of Conversion Shares, assuming the conversion rights attaching to the Convertible Bonds are exercised in full at the Conversion Price Number of Approximate Shares % 11,400,000 0.81% 175,000 0.01% 11,575,000 0.82% 1,050,000,000 74.87% 20,678,685 1.48% 62,036,055 4.42% 41,357,370 2.95% 216,795,653 15.46% 1,402,442,763 100.00%

Note:

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

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FUND RAISING ACTIVITIES OF THE COMPANY IN THE PAST TWELVE-MONTH PERIOD

The Company has conducted the following fund raising activities in the past 12 months immediately preceding the date of this announcement:

			Intended use
			of proceeds
Date of			as stated in the	Actual use of
announcement	Event	Net proceeds	announcement	Proceeds/Remark
23 August 2011	Subscription of	Approximately	General working	All proceeds had
	141,000,000 new	HK$5.6 million	capital of the	been used as
	Shares		Group and	intended as
			repayment of	general working
			liabilities	capital in the
				amount of
				approximately
				HK$2.1 million
				and for
				repayment of
				liabilities of the
				Company in the
				amount of
				approximately
				HK$3.5 million
8 September 2011	Subscription of	Approximately	Setting off an	All proceeds had
	1,150,000,000	HK$45.2 million	equivalent	been used as
	new Shares		outstanding	intended for
			principal amount	setting off an
			of the promissory	equivalent
			notes due by the	outstanding
			Company	principal amount
				of approximately
				HK$46.0 million
				of the promissory
				notes due by the
				Company
11 January 2012	Subscription of	Approximately	General working	All proceeds had
	21,300,000 new	HK$4.9 million	capital of the	been used as
	Shares under		Group and	intended as
	general mandate		repayment of	general working
			liabilities	capital of the
				Group in 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	US$8.95 million	discharge of	discharge of
	new Shares	(approximately	the Promissory	the Promissory
		HK$69.81 million)	Notes	Notes

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(2) GENERAL

Second EGM will be convened for the Shareholders to consider and, if thought fit, to pass the resolutions to approve and confirm the grant of the New Placing Specific Mandate and the execution of Supplemental Agreement. A circular will be despatched by the Company to the Shareholders on or before 12 July 2012, containing further details of the Supplemental Agreement and a notice of the Second EGM.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, save as aforesaid, no Director or Shareholder has a material interest in the Placing and the issue of Convertible Bonds. Accordingly, no Shareholder is required to abstain from voting at the Second EGM in respect of the resolutions relating to the Placing and the issue of Convertible Bonds. Voting at the Second EGM will be conducted by way of poll.

As the Placing Agreement may or may not complete, Shareholders and potential investors of the Company should exercise caution when dealing in the Shares or any other securities of the Company.

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

Hong Kong, 26 June 2012

As at the date of this announcement, the Board consists of Mr. Lim Ho Sok and Mr. Shin Min Chul 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 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 www.ilinkfin.net/siberian_mining.

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