WH Group Limited — Capital/Financing Update 2013

Aug 20, 2013

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.

China Gamma Group Limited 中國伽瑪集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 164)

PLACING OF NOTES

Placing Agent

CHINA RICH SECURITIES LIMITED

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This announcement is made pursuant to Rule 13.09 of the Listing Rules and Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the SFO.

On 20 August 2013 (after trading hours), the Company entered into the Placing Agreement with the Placing Agent, pursuant to which the Company agreed to place, through the Placing Agent, on a best effort basis, the Placing Notes to professional investors. The Placing Agent shall use its best efforts to ensure and shall obtain confirmation to the effect that such Placees shall be third parties independent of and not connected with the Company, the directors, chief executive and substantial shareholders of the Company, any of its subsidiaries or their respective associates.

The Placing is unconditional and the Placing Notes will be placed in the denomination of HK$2,000,000 each and the Placing of each Placing Note will be completed within 7 Business Days after receipt by the Company of written notice given by the Placing Agent that it has procured a subscriber for a Placing Note and receipt of the Placing Price in full and clear funds in respect of the Completion Note.

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Assuming all the Placing Notes are placed and the Completion Notes are issued in full, the maximum gross proceeds from the Placing will be HK$300,000,000. The Company intends to use the net proceeds of approximately HK$284,000,000 for general corporate purposes including general working capital and refinancing of existing debts.

INTRODUCTION

This announcement is made pursuant to Rule 13.09 of the Listing Rules and Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the SFO.

On 20 August 2013 (after trading hours), the Company entered into the Placing Agreement with the Placing Agent. The principal terms of the Placing Agreement and the Completion Notes are set out below.

THE PLACING AGREEMENT

Date: 20 August 2013 (after trading hours) Issuer: The Company Placing Agent: The Placing Agent. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiry, the Placing Agent and its ultimate beneficial owners are third parties independent of and not connected with the Company, the directors, chief executive and substantial shareholders of the Company, any of its subsidiaries or their respective associates.

Placees: The Placing Agent agreed to, on a best effort basis, place the Placing Notes to those Placees who are professional investors (as defined in the SFO) and the Placing Agent shall use its best efforts to ensure and shall obtain confirmation to the effect that such Placees are third parties independent of and not connected with the Company, the directors, chief executive and substantial shareholders of the Company, any of its subsidiaries or their respective associates.

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Placing Price:

Principal amount of the Placing Notes

Placing Period:

A period of twelve months commencing upon the execution of the Placing Agreement unless terminated earlier pursuant to the terms of the Placing Agreement.

Ranking of Placing The Placing Notes will rank at least pari passu in right of Notes: payment with all other existing and future unsubordinated unsecured indebtedness of the Company, outstanding from time to time (other than obligations preferred by statute or operation of the applicable laws).

The Placing The Placing is unconditional Conditions:

Termination: The Company may terminate the Placing Agreement without liability to the other parties by giving notice in writing to the Placing Agent at any time six months after the date of the Placing Agreement.

Either the Company or the Placing Agent may terminate the Placing Agreement by written notice to the other party if (i) a party commits a material or persistent breach of any of its obligations under the Placing Agreement and where such breach is capable of remedy, fails to remedy it within 30 Business Days after service of written notice from the other person of such default or (ii) the termination of the Placing Agreement is required to comply with applicable laws, the Listing Rules, the rules, regulations, codes, guidelines and circulars issued by the regulators, and other requirements of the regulators applicable to it.

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Relevant Completion:

Upon the Placing Agent having procured a Placee for a Placing Note, the Placing Agent shall deliver a written notice (the “Completion Notice”) to the Company as soon as practicable, provided that no Completion Notice shall be delivered after the expiration of the Placing Period. Unless the Company refuses to complete placing of a Completion Note to a Placee pursuant to the Placing Agreement, within 3 Business Days upon receipt by the Company of, among other things, the Completion Notice, the Placing Agent shall make, or cause to be made, payment of a sum equal to the Placing Price to the Company. The Company shall within 7 Business Days after receipt of the Placing Price in full and clear funds in respect of the Completion Note execute the deed poll constituting the relevant Completion Note.

Placing Commission:

5% of the principal amount of each Completion Note

PRINCIPAL TERMS OF THE COMPLETION NOTES

Aggregate Principal Up to HK$300,000,000 Amount:

Denomination: In the denomination of HK$2,000,000 each

Interest: 5% per annum payable in arrear on 30 November in each year pro-rata on number of days elapsed on the basis of a 360-day year consisting of twelve months of 30 days each

Maturity: Seven years after the Issue Date

Early Redemption: The Company may but is not obliged to at any time after the third anniversary of the Issue Date and prior to the Maturity Date redeem in whole, but not in part, of the Completion Note at a redemption price equal to the principal amount of the Completion Note outstanding together with accrued interest to the date fixed for redemption, if any.

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Transferability:

The Completion Note may be transferred in whole, but not in part, to a single transferee, subject to the terms and conditions of the Completion Note.

Listing:

No application will be made for the listing of the Completion Notes on the Stock Exchange or any other stock exchange.

INTENDED USE OF PROCEEDS AND REASON FOR THE PLACING

The Group is principally engaged in property business, gamma ray irradiation services and resources business. As discussed in the 2013 Annual Report of the Company, currently the demand and price of rare earth products still remain low and the prospects of the rare earth market is an uncertainty. In view of this, the Group started to rationalize the resources business by considering the possibilities of restructuring the rare earth refinery and processing business, and made a plan to sell a group of subsidiaries that engaged in that business if the assets value would be better reflected by such a sale transaction rather than through continuing use. The Group is actively seeking buyers for the said business. As such, the rare earth refinery and processing business was reclassified in the Group’s consolidated financial statements as assets and liabilities held for sale. Preliminary discussions with potential buyers were on going and negotiations for the sale were still in progress. Agreement for the sale of the said business may or may not be reached. In order to further improve the Group’s liquidity and to increase its working capital, the Company is considering different fund raising options so as to strengthen the Group’s financial base.

The Placing will be carried out on an best effort basis. As such it is possible that not all the Placing Notes are placed. Assuming all the Placing Notes are placed and the Completion Notes are issued in full, the maximum gross proceeds from the Placing will be HK$300,000,000. The net proceeds from the Placing, after the deduction of the placing commission and other related costs and expenses, are estimated to be approximately HK$284,000,000. The Company intends to use the net proceeds for general corporate purposes including general working capital and refinancing of existing debts. The Company may adjust the foregoing plans in response to changing market conditions and certain other circumstances and therefore may reallocate the use of proceeds.

The Directors (including the independent non-executive Directors) consider that the Placing provides a good opportunity for the Company to raise funds to strengthen its liquidity and financial position for the Company’s future development and expansion, therefore it is in the best interests of the Company and its Shareholders as a whole for the Company to enter into the Placing.

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FUND RAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Company raised net proceeds of approximately HK$40,075,000 for general working capital upon completion of placing and top-up subscription of 420,000,000 Shares in March 2013. Apart from the above, the Company did not carry out any other fund raising exercise in the twelve months period immediately preceding the date of the Placing Agreement.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions have the following meanings:

“associate(s)”	has the meaning ascribed to it under the Listing Rules
“Board”	the board of Directors
“Business Day”	a day (excluding Saturday, Sunday and other public
	holiday) on which commercial banks are open for
	business in Hong Kong throughout their normal business
	hours
“Company”	China Gamma Group Limited, a company incorporated in
	the Bermuda and the issued Shares of which are listed on
	the Stock Exchange
“Completion Notes”	such part of the Placing Notes placed pursuant to the
	Placing Agreement and “Completion Note” shall be
	construed accordingly
“Director(s)”	director(s) of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	The Hong Kong Special Administrative Region of the
	People’s Republic of China
“Issue Date”	respective date of issue of each Completion Note

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“Listing Rules”

Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

“Maturity Date”

“Maturity Date” seven years after the Issue Date “Placee(s)” any person or entity whom the Placing Agent or its agent(s) has procured to purchase any of the Placing Notes and approved by the Company during the Placing Period pursuant to the Placing Agent’s obligations under the Placing Agreement

“Placing” the placing of the Placing Notes by the Placing Agent pursuant to the terms and conditions of the Placing Agreement

“Placing Agent” China Rich Securities Limited, a licensed corporation to carry on business in type 1 regulated activity (dealing in securities) under the SFO

“Placing Agreement” the agreement dated 20 August 2013 entered into between the Company and the Placing Agent in relation to the Placing

“Placing Notes” the notes in the aggregate amount of up to HK$300,000,000 to be issued by the Company in the denomination of HK$2,000,000 each under the Placing and “Placing Note” means each of the said notes in the said denomination of HK$2,000,000

“Placing Period” A period of twelve months commencing upon the execution of the Placing Agreement unless terminated earlier pursuant to the terms of the Placing Agreement

“Placing Price”

Principal amount of the Placing Notes

“SFO”

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

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“Share(s)” of the Company “Shareholder(s)” the holder(s) of the Share(s) “Stock Exchange” “substantial shareholder”

the ordinary share(s) of HK$0.01 each in the share capital of the Company

The Stock Exchange of Hong Kong Limited

has the meaning ascribed to it under the Listing Rules

“HK$” Hong Kong dollar(s), the lawful currency of Hong Kong “%” per cent.

By order of the Board China Gamma Group Limited Wong King Shiu, Daniel Executive Director

Hong Kong, 20 August 2013

As at the date of this announcement, the executive director of the Company is Mr. Wong King Shiu, Daniel; the non-executive directors of the Company are Mr. Ma Kwok Hung, Warren and Mr. Chow Siu Ngor; and the independent non-executive directors of the Company are Mr. Wong Hoi Kuen, Mr. Chan Chi Yuen and Mr. Hung Hing Man.

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