ANNOUNCEMENT PLACING OF EXISTING SHARES AND SUBSCRIPTION OF SHARES AND

Transcription

1 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. This announcement is for information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any securities and neither this announcement nor anything herein forms the basis for any contract or commitment whatsoever. Neither this announcement nor any copy hereof may be taken into or distributed in the United States. The information contained in this announcement is not for distribution, directly or indirectly, in or into the United States. This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The Shares and the Bonds mentioned herein have not been, and will not be, registered under the Securities Act, and may not be offered or sold in the United States except pursuant to registration or an exemption from the registration requirements of the Securities Act. No public offering of the Shares or the Bonds will be made in the United States. (Incorporated in Hong Kong with limited liability) (Stock Code: 606) ANNOUNCEMENT PLACING OF EXISTING SHARES AND SUBSCRIPTION OF SHARES AND PROPOSED ISSUE OF HK$ FIXED RATE GUARANTEED CONVERTIBLE BONDS DUE 2015 BY GLORY RIVER HOLDINGS LIMITED Placing Agents, Joint Bookrunners and Joint Lead Managers 1

2 Placing of Existing Shares and Subscription of Shares The Board announces that on 21 July 2010, the Vendor, the Company and the Placing Agents have entered into the Share Placing and Subscription Agreement whereby (i) the Vendor has appointed the Placing Agents and the Placing Agents have conditionally agreed to severally and not jointly act as agents for the Vendor to procure purchasers or, failing which themselves as principals to purchase 178,000,000 Placing Shares held by the Vendor at the Placing Price of HK$8.75 per Share, and (ii) the Vendor conditionally agreed to subscribe for 178,000,000 Subscription Shares at the Subscription Price of HK$8.75 per Share. The 178,000,000 Placing Shares represent: (i) approximately 4.61% of the existing issued share capital of the Company of 3,860,281,839 Shares as at the date of this announcement; (ii) approximately 4.41% of the issued share capital of the Company as enlarged by the Share Subscription (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares); (iii) approximately 4.13% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds); and (iv) approximately 4.06% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds and the Option Bonds). The Company will apply to the Hong Kong Stock Exchange for the listing of, and permission to deal in, the Subscription Shares. Proposed Issue of HK$ Fixed Rate Guaranteed Convertible Bonds Due 2015 by the Bond Issuer The Board announces that also on 21 July 2010, the Bond Issuer, the Company and the Joint Bookrunners and Joint Lead Managers have entered into the Bond Subscription Agreement whereby each of the Joint Bookrunners and Joint Lead Managers has conditionally and severally agreed to subscribe and pay for, or to procure subscribers to subscribe and pay for, the Firm Bonds to be issued by the Bond Issuer in an initial aggregate principal amount of HK$3,100,000,000. The Company has unconditionally and irrevocably guaranteed the due payments of all sums expressed to be payable by the Bond Issuer under the Firm Bonds. 2

3 In addition, the Bond Issuer has granted to the Joint Bookrunners and Joint Lead Managers the Option to subscribe for all or any of the Option Bonds up to a further aggregate principal amount of HK$775,000,000, and the Option shall be exercisable on one or more occasions, in whole or in part, solely at the discretion of the Joint Bookrunners and Joint Lead Managers, at any time on or before the 30th day following the Firm Bonds Closing Date. Based on the initial Conversion Price of HK$ and assuming full conversion of the Firm Bonds and the Option Bonds at the initial Conversion Price, the Bonds will be convertible into 340,659,341 New Shares, representing: (i) approximately 8.82% of the existing issued share capital of the Company of 3,860,281,839 Shares as at the date of this announcement; (ii) approximately 8.44% of the issued share capital of the Company as enlarged by the Share Subscription (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares); (iii) approximately 7.90% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds); and (iv) approximately 7.78% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds and the Option Bonds). It is intended the Bonds will be listed on SGX-ST. An application has been made to the SGX-ST for the listing of the Bonds and the Company will apply to the Hong Kong Stock Exchange for the listing of, and permission to deal in, the New Shares. General Mandate Both the Subscription Shares and the New Shares will be allotted and issued pursuant to the General Mandate and will rank pari passu in all respects with the Shares then in issue on the relevant allotment or conversion date (as applicable). As at the date of this announcement, there has been no issue of Shares under the General Mandate. Use of Proceeds The gross proceeds and the net proceeds from the Share Subscription will be approximately HK$1,557,500,000 and approximately HK$1,524,700,000, respectively. The net proceeds raised per Share upon the completion of the Share Subscription will be approximately HK$8.57 per Share. 3

4 The gross proceeds from the issue of the Bonds will be approximately HK$3,100,000,000 (assuming no Option Bonds are issued) to approximately HK$3,875,000,000 (assuming the Option Bonds are issued in full), and the net proceeds from the issue of Bonds will be approximately HK$3,034,100,000 (assuming no Option Bonds are issued) to approximately HK$3,792,700,000 (assuming the Option Bonds are issued in full). The Company intends to use the net proceeds from the Share Subscription and from the Bond Issue to fund capital expenditure in connection with the expansion of production capacity, working capital and general corporate purposes. Completion of the Share Placing and Subscription Agreement and the Bond Subscription Agreement is subject to the satisfaction and/or waiver of the conditions precedent therein respectively. In addition, the Share Placing and Subscription Agreement and the Bond Subscription Agreement may be terminated in certain circumstances. Please refer to the paragraph headed The Share Placing and Subscription Agreement and The Bond Subscription Agreement below for further information. As the Share Placing and Subscription and the Bond Issue may or may not complete, Shareholders and potential investors are advised to exercise caution when dealing in the securities of the Company. THE SHARE PLACING AND SUBSCRIPTION AGREEMENT The Placing Date: 21 July 2010 Parties: The Vendor, the Company and the Placing Agents The Vendor is a controlling shareholder (as defined in the Listing Rules) of the Company currently holding 1,922,550,331 Shares representing approximately 49.80% of the issued share capital of the Company as at the date of this announcement. The Vendor and its concert parties are currently holding an aggregate of 2,336,314,814 Shares representing approximately 60.52% of the issued share capital of the Company as at the date of this announcement. The Placing Agents are J.P. Morgan Securities (Asia Pacific) Limited (or its affiliate) and Morgan Stanley & Co. International plc. To the best of the information, knowledge and belief of the Directors, having made all reasonable enquiries, each of the Placing Agents and their ultimate beneficial owners is a third party independent of, and not connected with, the Company, its subsidiaries and their respective directors, chief executives and substantial shareholders, and their respective associates, and is not a connected person of the Company. 4

5 In so far as Morgan Stanley & Co. International plc, in performing its functions under the Share Placing and Subscription Agreement, is dealing in securities as defined in Part 2 of Schedule 5 of the SFO, it shall only do so through its agent Morgan Stanley Asia Limited, and only in circumstances such that none of the subprovisos (I), (II), (III), (IV) and (V) in sub-paragraph (iv) to the definition of dealing in securities in Part 2 of Schedule 5 of the SFO is applicable. The Placing: Placees: The Vendor has appointed the Placing Agents and the Placing Agents have conditionally agreed to severally and not jointly act as agents for the Vendor to procure purchasers or, failing which themselves as principals, to purchase 178,000,000 Placing Shares held by the Vendor at the Placing Price. The Placees and their ultimate beneficial owners are not associates of the Vendor or connected persons of the Company. It is also expected that the Placing Shares will be placed to not less than six Placees which are professional, institutional or other investors. The Company currently anticipates that none of the Placees will become a substantial shareholder of the Company upon completion of the Placing. Number of Placing Shares: A total of 178,000,000 Placing Shares, which will be placed by the Placing Agents, representing: (i) (ii) approximately 4.61% of the existing issued share capital of the Company of 3,860,281,839 Shares as at the date of this announcement; approximately 4.41% of the issued share capital of the Company as enlarged by the Share Subscription (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares); (iii) approximately 4.13% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds); and 5

6 (iv) approximately 4.06% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds and the Option Bonds). Placing Price: The Placing Price (or the Subscription Price) of HK$8.75 per Placing Share represents: (i) (ii) a discount of approximately 7.89% to the closing price of HK$9.50 per Share as quoted on the Hong Kong Stock Exchange on the Last Trading Day; a discount of approximately 5.16% to the average closing price of approximately HK$9.23 per Share as quoted on the Hong Kong Stock Exchange for the last five consecutive trading days prior to and including the Last Trading Day; and (iii) a discount of approximately 4.78% to the average closing price of approximately HK$9.19 per Share as quoted on the Hong Kong Stock Exchange for the last ten consecutive trading days prior to and including the Last Trading Day. The Placing Price was determined with reference to the prevailing market price of the Share and was negotiated on an arm s length basis between the Company and the Placing Agents. The Directors consider that the terms of the Placing are on normal commercial terms and are fair and reasonable based on the current market conditions and the Placing is in the interests of the Company and the Shareholders as a whole. The total amount of gross proceeds to the Vendor from the Placing is HK$1,557,500,000. Rights of the Placing Shares: Completion of the Placing: The Placing Shares will be sold free from all liens, charges and encumbrances, and together with all rights attaching to them as at the Trade Date, including the right to receive all dividends declared, made or paid on or after the Trade Date. Completion of the Placing is expected to take place on the Placing Closing Date. 6

7 The Share Subscription Parties: The Subscription Price: The Vendor as subscriber and the Company as issuer. The Subscription Price is HK$8.75 per Share, which is the same as the Placing Price. Number of Subscription The Company will allot and issue a total of 178,000,000 Shares: Subscription Shares, which is equivalent to the number of Placing Shares sold by the Vendor under the Share Placing and Subscription Agreement, all of which will be subscribed by the Vendor, which represent: (i) (ii) approximately 4.61% of the existing issued share capital of the Company of 3,860,281,839 Shares as at the date of this announcement; approximately 4.41% of the issued share capital of the Company as enlarged by the Share Subscription (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares); (iii) approximately 4.13% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds); and (iv) approximately 4.06% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds and the Option Bonds). Ranking of Subscription Shares: The Subscription Shares, when issued and fully paid, will rank pari passu in all respects among themselves and with the issued Shares as at the date of the completion of the Share Subscription. The issue of the Subscription Shares is not subject to the approval of the Shareholders. 7

8 Conditions of the Share Subscription: Completion of the Share Subscription is conditional on: (i) the Listing Committee of the Hong Kong Stock Exchange granting listing of and permission to deal in the Subscription Shares (and such listing and permission not subsequently revoked prior to the delivery of definitive share certificate(s) representing the Subscription Shares); and (ii) completion of the Placing. If the conditions are not fulfilled within 14 days after the date of the Share Placing and Subscription Agreement or such later date as may be agreed between the Company and the Vendor, the obligations and liabilities of the Vendor and the Company under the Share Subscription shall be null and void, save that the Vendor may in its absolute discretion continue to take all necessary steps but subject to compliance with the Listing Rules, to proceed to complete the Share Subscription as soon as practicable thereafter. Completion of Completion of the Share Subscription will take place on the the Share Subscription: second Business Day after the date upon which the last of the conditions to be satisfied shall have been so satisfied, provided that it shall take place on a date no later than a date falling 14 days after the date of the Share Placing and Subscription Agreement (or such other time and/or date as the Vendor and the Company may agree in writing). If the Share Subscription is not completed within 14 days from the date of Share Placing and Subscription Agreement, it will constitute a connected transaction under the Listing Rules and is subject to compliance with the requirements under Chapter 14A of the Listing Rules, which may include the issue of a separate announcement and approval of the independent Shareholders. Application for listing: Lock-up undertaking: Application will be made by the Company to the Hong Kong Stock Exchange for the listing of and permission to deal in the Subscription Shares. In order to induce the Placing Agents to enter into the Share Placing and Subscription Agreement: a. The Vendor undertakes to the Placing Agents that (except for the sale of the Placing Shares pursuant to the Placing) for a period of 120 days from the Placing Closing Date, it will not and will procure that none of its nominees and companies controlled by it and trusts associated with it 8

9 (whether individually or together and whether directly or indirectly) will (i) offer, lend, pledge, issue, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of (either conditionally or unconditionally, or directly or indirectly, or otherwise) any Shares (including the Subscription Shares) or any interests therein beneficially owned or held by the Vendor or any securities convertible into or exercisable or exchangeable for or substantially similar to any such Shares or interests or (ii) enter into any swap or similar agreement that transfers, in whole or in part, the economic risk of ownership of such Shares, whether any such transaction described in (i) or (ii) above is to be settled by delivery of Shares or such other securities, in cash or otherwise or (iii) announce any intention to enter into or effect any such transaction described in (i) or (ii) above, unless with the prior written consent of the Placing Agents, which consent shall not be unreasonably withheld or delayed. b. The Company undertakes to the Placing Agents, and the Vendor undertakes to the Placing Agents to procure, that for a period of 120 days from the Placing Closing Date, the Company will not, except for the Subscription Shares and save pursuant to (1) the terms of any employee share option schemes of the Company or (2) any outstanding subscription warrants or (3) any bonus or scrip dividend or similar arrangements which provide for the allotment of Shares in lieu of the whole or part of a dividend on Shares of the Company in accordance with its articles of association or (4) any conversion of outstanding convertible bonds or notes or (5) the Bond Subscription Agreement (i) allot or issue or offer to allot or issue or grant any option, right or warrant to subscribe (either conditionally or unconditionally, or directly or indirectly, or otherwise) any Shares or any interests in Shares or any securities convertible into or exercisable or exchangeable for or substantially similar to any Shares or interest in Shares; or (ii) agree (conditionally or unconditionally) to enter into or effect any such transaction with the same economic effect as any of the transactions described in (i) above; or (iii) announce any intention to enter into or effect any such transaction described in (i) or (ii) above without first having obtained the written consent of the Placing Agents, which consent shall not be unreasonably withheld or delayed. 9

10 Termination: The Placing Agents may terminate the Share Placing and Subscription Agreement without liability to the Vendor and the Company by giving notice in writing to the Vendor and the Company, which notice may be given at any time on or before 10:00 a.m. (Hong Kong time) on the Placing Closing Date: a. there develops, occurs or comes into force: (i) (ii) any new law or regulation or any change or development involving a prospective change in existing laws or regulations which in the opinion of the Placing Agents has or is likely to have a material adverse effect on the financial position of the Group as a whole; or any significant change (whether or not permanent) in local, national or international monetary, economic, financial, political or military conditions which in the opinion of the Placing Agents is or would be materially adverse to the success of the Placing; or (iii) any significant change (whether or not permanent) in local, national or international securities market conditions or currency exchange rates or exchange controls which in the opinion of the Placing Agents is or would be materially adverse to the success of the Placing; or (iv) a general moratorium on commercial banking activities in Hong Kong, London or New York declared by the relevant authorities or a material disruption in commercial banking or securities settlement or clearance services in Hong Kong, the United Kingdom or the United States; or (v) any outbreak or escalation of hostilities or act of terrorism involving Hong Kong, the United Kingdom or the United States or the declaration by the People s Republic of China, the United Kingdom or the United States of a national emergency or war or any suspension of dealings in the Shares (other than as a result of the Placing or the Bond Issue); or (vi) any moratorium, suspension or material restriction on trading in shares or securities generally on the Hong Kong Stock Exchange, the London Stock Exchange, the New York Stock Exchange or Nasdaq due to exceptional financial circumstances or otherwise at any time prior to the Placing Closing Date; or 10

11 THE BOND SUBSCRIPTION AGREEMENT Date: 21 July 2010 b. any breach of any of the representations, warranties and undertakings by the Company and/or the Vendor set out in the Share Placing and Subscription Agreement comes to the knowledge of the Placing Agents or any event occurs or any matter arises on or after the date of the Share Placing and Subscription Agreement and prior to the Placing Closing Date which if it had occurred or arisen before the date of the Share Placing and Subscription Agreement would have rendered any of such representations, warranties and undertakings untrue or incorrect in any respect or there has been a breach of, or failure to perform, any other provision of the Share Placing and Subscription Agreement on the part of the Vendor and/or the Company; or c. there is any such adverse change, or development involving a prospective adverse change, in the general affairs, conditions, results of operations or prospects, management, business, stockholders equity or in the financial or trading position of the Group as a whole which in the opinion of the Placing Agents is materially adverse to the success of the Placing. Parties: The Bond Issuer as issuer, the Company as guarantor and the Joint Bookrunners and Joint Lead Managers as subscribers. In so far as Morgan Stanley & Co. International plc, in performing its functions under the Bond Subscription Agreement, is dealing in securities as defined in Part 2 of Schedule 5 of the SFO, it shall only do so through its agent Morgan Stanley Asia Limited, and only in circumstances such that none of the sub-provisos (I), (II), (III), (IV) and (V) in sub-paragraph (iv) to the definition of dealing in securities in Part 2 of Schedule 5 of the SFO is applicable. Proposed issue of the Firm Bonds: Option to issue Option Bonds: The Joint Bookrunners and Joint Lead Managers have severally agreed to subscribe and pay for, or to procure subscribers to subscribe and pay for, the Firm Bonds to be issued by the Bond Issuer in an initial aggregate principal amount of HK$3,100,000,000. The Bond Issuer has granted to the Joint Bookrunners and Joint Lead Managers the Option to subscribe for all or any of the Option Bonds up to a further aggregate principal amount of HK$775,000,000, and the Option shall be exercisable on one or more occasions, in whole or in part, solely at the discretion of the Joint Bookrunners and Joint Lead Managers, at any time on or before the 30th day following the Firm Bonds Closing Date. 11

12 Stabilisation: Conditions Precedent: J.P. Morgan Securities Ltd. (or its affiliate) and Morgan Stanley & Co. International plc (the Stabilising Managers ) may, to the extent permitted by applicable laws and directives, overallot and effect transactions with a view to supporting the market price of the Bonds and/or the Shares at a level higher than that which might otherwise prevail, but in doing so the Stabilising Managers shall act as principal and not as agent of the Bond Issuer or the Company and any loss resulting from over-allotment and stabilisation will be borne, and any profit arising therefrom shall be beneficially retained, by the Stabilising Managers in the manner agreed by them. The obligations of the Joint Bookrunners and Joint Lead Managers to subscribe and pay for the Bonds are subject to, among others, the following conditions precedent: a. Due Diligence: the Joint Bookrunners and Joint Lead Managers being satisfied with the results of their due diligence investigations with respect to the Bond Issuer, the Company and their respective subsidiaries and the offering circular in relation to the Bonds shall have been prepared in form and content satisfactory to the Joint Bookrunners and Joint Lead Managers; b. Other contracts: the execution and delivery (on or before the Firm Bonds Closing Date) of the trust deed constituting the Bonds and the paying and conversion agency agreement in relation to the Bonds, each in a form reasonably satisfactory to the Joint Bookrunners and Joint Lead Managers, by the respective parties; c. Lock-up: COFCO (Hong Kong) Limited shall have executed a lock-up agreement on or before the Firm Bonds Closing Date in the form set out in the Bond Subscription Agreement; d. At the Firm Bonds Closing Date and the Option Bonds Closing Date (if any): (i) (ii) the representations and warranties of the Bond Issuer and the Company in the Bond Subscription Agreement being true, accurate and correct at, and as if made on such date; the Bond Issuer and the Company having performed all of their respective obligations under the Bond Subscription Agreement to be performed on or before such date; and 12

13 (iii) there having been delivered to the Joint Bookrunners and Joint Lead Managers a certificate, dated as of such date, of a duly authorised officer of the Bond Issuer and of the Company respectively to such effect; e. Material adverse change: after the date of the Bond Subscription Agreement or, if earlier, the dates as of which information is given in the offering circular up to and on each of the Firm Bonds Closing Date and the Option Bonds Closing Date (if any), there shall not have occurred any change (nor any development or event involving a prospective change), in the financial or business condition, prospects, results of operations or general affairs of the Company or of the Company and its subsidiaries taken as a whole from that set out in the offering circular in relation to the Bonds, which, in the opinion of the Joint Bookrunners and Joint Lead Managers, is material and adverse in the context of the issue and offering of the Bonds; f. Other consents: on or prior to the Firm Bonds Closing Date there shall have been delivered to the Joint Bookrunners and Joint Lead Managers copies of all consents and approvals necessary for the Bond Issuer and the Company in relation to the issue of the Bonds and the performance of the Bond Issuer s and Company s respective obligations under the trust deed, the paying and conversion agency agreement and the Bonds; and g. Listing: the Hong Kong Stock Exchange having agreed to list the New Shares upon conversion of the Bonds (or the Joint Bookrunners and Joint Lead Managers being reasonably satisfied that such listing will be granted). The Joint Bookrunners and Joint Lead Managers may, at their discretion and upon such terms as they think fit waive compliance with the whole or any part of the conditions precedent. Completion: Distribution: Completion of the subscription and issue of the Firm Bonds or Option Bonds (if any) will take place on the Firm Bonds Closing Date or, as the case may be, such Option Bonds Closing Date. The Bonds and the New Shares have not been and will not be registered under the Securities Act and, subject to certain exceptions, may not be offered or sold within the United States. The Bonds will be offered and sold in an institutional offering outside the United States in reliance on Regulation S of the 13

14 Securities Act. None of the Bonds will be offered to the public in Hong Kong nor will they be placed to any connected persons of the Company. The Bonds have not been offered or sold and will not be offered or sold in Hong Kong to the public within the meaning of the Companies Ordinance. To the best of the Directors knowledge, information and belief, having made all reasonable enquiries, the Joint Bookrunners and Joint Lead Managers are independent third parties not connected with the Bond Issuer, the Company or any of their Subsidiaries or any of their respective directors, chief executives or substantial shareholders or any of their respective associates. The New Shares will rank pari passu in all respects with the Shares then in issue on the relevant conversion date. The issue of the Bonds is not subject to the approval of the shareholders of the Bond Issuer. Lock-up Undertaking: Each of the Bond Issuer and the Company has agreed in the Bond Subscription Agreement that neither it nor any person acting on its or their behalf will (a) issue, offer, sell, pledge, contract to sell or otherwise dispose of or grant options, issue warrants or offer rights entitling persons to subscribe or purchase any interest in any Shares or securities of the same class as the Bonds or the Shares or any securities convertible into, exchangeable for or which carry rights to subscribe or purchase the Bonds, the Shares or securities of the same class as the Bonds, the Shares or other securities representing interests in the Bonds, the Shares or other securities of the same class as them, (b) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of the ownership of the Shares, (c) enter into any transaction with the same economic effect as, or which is designed to, or which may reasonably be expected to result in, or agree to do, any of the foregoing, whether any such transaction of the kind described in (a), (b) or (c) is to be settled by delivery of Shares or other securities, in cash or otherwise or (d) announce or otherwise make public an intention to do any of the foregoing, in any such case without the prior written consent of the Joint Bookrunners and Joint Lead Managers between the date hereof and the date which is 120 days after the Firm Bonds Closing Date (or (if later) the Option Bonds Closing Date) (both dates inclusive); except (i) for the Bonds and the New Shares issued on conversion of the Bonds, (ii) the placing of Shares pursuant to the Share Placing and Subscription Agreement and (iii) the issue of the Subscription Shares by the Company following the Placing. 14

15 Shareholders Lock Up: Termination: COFCO (Hong Kong) Limited has undertaken that, for a period from the date of the Bond Subscription Agreement up to 120 days after the Firm Bonds Closing Date (or if any Option Bonds are issued, after the last Option Bonds Closing Date) (both dates inclusive), neither it nor any of its subsidiaries (if applicable) or affiliates or spouse (if applicable) or family members (if applicable) over which it exercises management or voting control, nor any person acting on its or their behalf will, without the prior written consent of the Joint Bookrunners and Joint Lead Managers, issue, offer, sell, contract to sell, pledge or otherwise dispose of (or publicly announce any such issuance, offer, sale or disposal), any Shares or securities convertible or exchangeable into or exercisable for Shares or warrants or other rights to purchase Shares or any security or financial product whose value is determined directly or indirectly by reference to the price of the Shares, including equity swaps, forward sales and options representing the right to receive any Shares (whether or not such contract is to be settled by delivery of Shares or such other securities, in cash or otherwise), except for (i) the placing of Shares pursuant to the Share Placing and Subscription Agreement and (ii) the issue of the new Shares by the Company following the Placing. The Joint Bookrunners and Joint Lead Managers may, by notice to the Bond Issuer and the Company given at any time prior to payment of the net subscription monies for the Firm Bonds or the Option Bonds (if any) to the Company, terminate the Bond Subscription Agreement in any of the following circumstances: 1. if there shall have come to the notice of the Joint Bookrunners and Joint Lead Managers any breach of, or any event rendering untrue or incorrect in any respect, any of the warranties and representations contained in the Bond Subscription Agreement or any failure to perform any of the Bond Issuer s and/or Company s undertakings or agreements in the Bond Subscription Agreement; 2. if any of the conditions precedent have not been satisfied or waived by the Joint Bookrunners and Joint Lead Managers on or prior to the Firm Bonds Closing Date or the Option Bonds Closing Date, as the case may be; 3. if in the opinion of the Joint Bookrunners and Joint Lead Managers, there shall have been, since the date of the Bond Subscription Agreement, any change, or any development involving a prospective change, in national or international monetary, financial, political or economic conditions (including any disruption to trading generally, or trading in any securities of the Company on any stock exchange or in any over-the-counter market) or currency exchange rates 15

16 or foreign exchange controls such as would, in its view, be likely to prejudice materially the success of the offering and distribution of the Bonds or dealings in the Bonds in the secondary market; 4. if, in the opinion of the Joint Bookrunners and Joint Lead Managers, there shall have occurred any of the following events: (i) a suspension or a material limitation in trading in securities generally on the New York Stock Exchange, the London Stock Exchange plc, the SGX-ST and/or the Hong Kong Stock Exchange and/or any other stock exchange on which the Company s securities are traded; (ii) a suspension or a material limitation in trading in the Company s securities on the Hong Kong Stock Exchange and/or any other stock exchange on which the Company s securities are traded; or (iii) a general moratorium on commercial banking activities in the United States, Singapore, Hong Kong and/ or the United Kingdom declared by the relevant authorities or a material disruption in commercial banking or securities settlement or clearance services in the United States, Hong Kong, Singapore or the United Kingdom; or 5. if, in the opinion of the Joint Bookrunners and Joint Lead Managers, there shall have occurred any event or series of events (including the occurrence of any local, national or international outbreak or escalation of disaster, hostility, insurrection, armed conflict, act of terrorism, act of God or epidemic) as would in their view be likely to prejudice materially the success of the offering and distribution of the Bonds or dealings in the Bonds in the secondary market. The Directors consider that the terms and conditions of the Bond Subscription Agreement and the Bonds are fair and reasonable, on normal commercial terms and in the interests of the Company and its shareholders as a whole. Conversion Shares: Based on the initial Conversion Price of HK$ and assuming full conversion of the Firm Bonds and the Option Bonds at the initial Conversion Price, the Bonds will be convertible into 340,659,341 New Shares, represents: (i) (ii) approximately 8.82% of the existing issued share capital of the Company of 3,860,281,839 Shares as at the date of this announcement; approximately 8.44% of the issued share capital of the Company as enlarged by the Share Subscription (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares); 16

17 PRINCIPAL TERMS OF THE BONDS (iii) approximately 7.90% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds); and (iv) approximately 7.78% of the issued share capital of the Company as enlarged by the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into the New Shares at the initial Conversion Price (assuming that there is no change in the issued share capital of the Company, save for the issue of the Subscription Shares and the New Shares pursuant to the full conversion of the Firm Bonds and the Option Bonds). The principal terms of the Bonds are summarised as follows: Bond Issuer: Glory River Holdings Limited Principal Amount of HK$3,100,000,000 aggregate principal amount of 1.00% the Firm Bonds: Convertible Bonds due 2015, convertible into fully-paid ordinary shares with a par value of HK$0.10 each in the share capital of the Company. Guarantee: Initial Bondholders: Issue Price of the Firm Bonds: Form and Denomination: Bond Subscription Price: The Company has unconditionally and irrevocably guaranteed the due payments of all sums expressed to be payable by the Bond Issuer under the Bonds and a trust deed. The Company s obligations in respect of the Bonds are contained in the trust deed. The Placees of the Bonds and their ultimate beneficial owners are third parties independent of and not connected with any of the Bond Issuer, the Company, its Subsidiaries, their respective directors, chief executives, substantial shareholders, and their respective associates, and otherwise are not connected persons of the Company. 100% of the principal amount of the Firm Bonds. The Bonds will be issued in registered form in the denomination of HK$100,000 each or integral multiples thereof. The subscription amount payable in respect of each Bond on the Firm Bonds Closing Date is approximately HK$100,

18 Interest: Maturity Date: Negative Pledge: Conversion Period: The Bonds bear interest from (and including) 29 July 2010 at the rate of 1.00% per annum calculated by reference to the principal amount of the Bonds and payable semi-annually in arrear in equal instalments on 29 January and 29 July in each year. 29 July 2015 (the Maturity Date ) So long as any Bond remains outstanding, neither the Bond Issuer nor the Company will, and the Bond Issuer and the Company shall procure that none of the Company s principal Subsidiaries will, create or have outstanding, any Encumbrance, upon the whole or any part of its present or future undertaking, assets or revenues (including any uncalled capital) to secure any Relevant Indebtedness, or any guarantee or indemnity in respect of any Relevant Indebtedness unless, at the same time or prior thereto the Bond Issuer s obligations under the Bonds are secured equally and rateably (a) therewith or by the same Encumbrance or (b) by such other security, guarantee, indemnity or other arrangement as either (i) the Trustee in its absolute discretion shall deem not materially less beneficial to the interests of the Bondholders or (ii) shall be approved by an extraordinary resolution of the Bondholders. On or after 8 September 2010 up to the close of business (at the place where the certificate evidencing such Bond is deposited for conversion) on the 10th day prior to the Maturity Date or, if such Bond shall have been called for redemption by the Bond Issuer before the Maturity Date, then up to the close of business (at the place aforesaid) on a date no later than seven days (both days inclusive and in the place aforesaid) prior to the date fixed for redemption thereof or if notice requiring redemption has been given by the holder of such Bond pursuant to the terms and conditions of the Bonds then up to the close of business (at the place aforesaid) on the day prior to the giving of such notice. The number of Shares to be issued on conversion of a Bond will be determined by dividing the principal amount of the Bond to be converted by the Conversion Price then in effect. Conversion Price: The initial Conversion Price is HK$ per Share, representing: (i) (ii) a premium of approximately 19.74% over the closing price of HK$9.50 per Share as quoted on the Hong Kong Stock Exchange on the Last Trading Day; a premium of approximately 23.29% over the average closing price of approximately HK$9.23 per Share as quoted on the Hong Kong Stock Exchange for the last five consecutive trading days up to and including the Last Trading Day; and 18

19 (iii) a premium of approximately 23.79% over average closing price of approximately HK$9.19 per Share as quoted on the Hong Kong Stock Exchange for the last ten consecutive trading days up to and including the Last Trading Day. The initial Conversion Price was determined after arm s length negotiations between the Company and the Joint Bookrunners and Joint Lead Managers with reference to the Placing Price. The Conversion Price will be subject to adjustment for, among other things, subdivision, reclassification or consolidation of Shares, bonus issues, rights issues, capital distributions, distributions and other dilutive events as described in the terms and conditions of the Bonds. The Conversion Price may not be reduced so that, on conversion of the Bonds, Shares would fall to be issued at a discount to their par value. Final Redemption: Unless previously redeemed, converted or purchased and cancelled in the circumstances referred to in the terms and conditions of the Bonds, the Bond Issuer will redeem each Bond at its principal amount multiplied by % together with accrued and unpaid interest thereon on the Maturity Date. Redemption at the Option On giving not less than 30 nor more than 90 days notice to the of the Bond Issuer: Bondholders and the Trustee (which notice will be irrevocable), the Bond Issuer: (i) may at any time after 29 July 2013 and prior to the Maturity Date redeem in whole, but not in part, the Bonds for the time being outstanding at their Early Redemption Amount as at the date fixed for redemption, together with interest accrued but unpaid to such date provided that the closing price of the Shares for each 20 out of 30 consecutive Trading Days, the last of which occurs not more than five Trading Days prior to the date upon which notice of such redemption is published was at least 130% of the Early Redemption Amount divided by the Conversion Ratio; or (ii) may at any time prior to the Maturity Date redeem in whole, but not in part, the Bonds being outstanding at their Early Redemption Amount as at the relevant date fixed for redemption, together with interest accrued but unpaid to such date provided that prior to the date of such notice at least 90% in principal amount of the Bonds originally issued (including any Option Bonds) has already been converted, redeemed or purchased and cancelled. 19

20 Tax Redemption and The Bonds may be redeemed at the option of the Bond Issuer in Non-Redemption Right: whole, but not in part, at any time, on giving not less than 30 nor more than 60 days irrevocable notice (a Tax Redemption Notice ) to the Bondholders at their Early Redemption Amount, together with interest accrued but unpaid to the tax redemption date, if (i) the Bond Issuer satisfies the Trustee immediately prior to the giving of such notice that the Bond Issuer (or if the Guarantee was called, the Company) has or will become obliged to pay additional tax amounts as a result of any change in, or amendment to, the laws or regulations of Hong Kong or the British Virgin Islands or any political subdivision or any authority thereof or therein having power to tax, or any change in the general application or official interpretation of such laws or regulations, which change or amendment becomes effective on or after 21 July 2010, and (ii) such obligation cannot be avoided by the Bond Issuer (or as the case may be, the Company) taking reasonable measures available to it, provided that no Tax Redemption Notice shall be given earlier than 90 days prior to the earliest date on which the Bond Issuer (or as the case may be, the Company) would be obliged to pay such additional tax amounts were a payment in respect of the Bonds then due. Redemption at the Option The Bond Issuer will, at the option of the holder of any Bond, of the Bondholders: redeem all or some only of such holder s Bonds on 29 July 2013 at their Early Redemption Amount as at the relevant date fixed for redemption, together with interest accrued but unpaid to such date. Redemption upon Delisting Following the occurrence of a Relevant Event, the holder of each or Change of Control: Bond will have the right at such holder s option, to require the Bond Issuer to redeem all or some only of such holder s Bonds on the Relevant Event Redemption Date (as defined below) at their Early Redemption Amount, together with interest accrued but unpaid to such date. To exercise such right, the holder of the relevant Bond must deposit at the specified office of any paying agent a duly completed and signed notice of redemption, in the form for the time being current, obtainable from the specified office of any paying agent ( Relevant Event Redemption Notice ), together with the certificate evidencing the Bonds to be redeemed by not later than 60 days following a Relevant Event, or, if later, 60 days following the date upon which notice thereof is given to Bondholders by the Bond Issuer in accordance with the terms and conditions of the Bonds. The Relevant Event Redemption Date shall be the fourteenth day after the expiry of such period of 60 days as referred to above. 20

21 Listing: Application has been made to the SGX-ST for the listing of the Bonds. The Bonds will be traded and settled in Hong Kong Dollars only. An application will be made to the Hong Kong Stock Exchange for the listing of, and permission to deal in, the New Shares. Clearing Systems: Voting rights: Transferability: Status: The Bonds will be represented by beneficial interests in the Global Certificate, which will be registered in the name of a nominee of, and deposited on the Firm Bonds Closing Date with a common depositary for, Euroclear Bank S.A./N.V. ( Euroclear ) and Clearstream Banking, société anonyme ( Clearstream ). Beneficial interests in the Global Certificate will be shown on and transfers thereof will be effected only through records maintained by Euroclear and Clearstream. Except as described in the Global Certificate, certificates for Bonds will not be issued in exchange for beneficial interests in the Global Certificate. Unless and until the Bondholders acquire the Shares upon conversion of the Bonds, they will have no rights with respect to the Shares, including any voting rights or rights to receive any regular dividends or other distributions with respect to the Shares. The Bonds are freely transferable. The Bonds constitute direct, unsubordinated, unconditional and (subject to the terms and conditions) unsecured obligations of the Bond Issuer and shall at all times rank pari passu and without any preference or priority among themselves. The payment obligations of the Bond Issuer under the Bonds and of the Company under the Guarantee shall, save for such exceptions as may be provided by mandatory provisions of applicable law and subject to the terms and conditions at all times rank at least equally with all of its other present and future senior, unsecured and unsubordinated obligations. 21

22 EFFECT ON THE SHARE CAPITAL OF THE COMPANY AS A RESULT OF THE PLACING, THE SHARE SUBSCRIPTION AND THE CONVERSION The following table illustrates (1) the existing shareholding structure as at the date of this announcement; (2) the shareholding structure immediately after completion of the Placing but before the Share Subscription; (3) the shareholding structure immediately after completion of the Placing and the Share Subscription; and (4) the shareholding structure immediately after completion of the Placing and the Share Subscription and assuming the Firm Bonds are fully converted into New Shares at the initial Conversion Price of HK$ each; and (5) the shareholding structure immediately after completion of the Placing and the Share Subscription and assuming the Firm Bonds and the Option Bonds are fully converted into New Shares at the initial Conversion Price of HK$ each; on the assumptions that (a) there will be no other change to the share capital of the Company from the date of this announcement until the completion of the Placing, the Share Subscription and the conversion of the Firm Bonds and the Option Bonds in full, save for the issue of the Subscription Shares, the New Shares as a result of the conversion of the Firm Bonds and the Option Bonds in full (as the case may be); and (b) the Placees and the Bondholders do not and will not hold any Shares other than the Placing Shares and the New Shares as a result of the conversion of the Firm Bonds and the Option Bonds in full (as the case may be). Immediately after Immediately after completion of the Placing and completion of the Placing and the Share Subscription and the Share Subscription and assuming the Firm Bonds and assuming the Firm Bonds are fully the Option Bonds are fully Immediately after completion Immediately after completion converted into New Shares converted into New Shares Existing (as at the date of the Placing but before of the Placing and at the initial Conversion of the initial Conversion Shareholder of this announcement) the Share Subscription the Share Subscription Price of HK$ each Price of HK$ each % of issued % of issued % of issued % of issued % of issued ordinary ordinary ordinary ordinary ordinary share share share share share No. of capital of No. of capital of No. of capital of No. of capital of No. of capital of Shares the Company Shares the Company Shares the Company Shares the Company Shares the Company Vendor (Note 1) 1,922,550, % 1,744,550, % 1,922,550, % 1,922,550, % 1,922,550, % COFCO (Hong Kong) Limited (Note 1) 273,764, % 273,764, % 273,764, % 273,764, % 273,764, % COFCO (BVI) No.108 Limited (Note 1) 140,000, % 140,000, % 140,000, % 140,000, % 140,000, % Placees (Note 2) 178,000, % 178,000, % 178,000, % 178,000, % Bondholders 272,527, % 340,659, % Other Shareholders 1,523,967, % 1,523,967, % 1,523,967, % 1,523,967, % 1,523,967, % Total 3,860,281, % 3,860,281, % 4,038,281, % 4,310,809, % 4,378,941, % Notes: 1. Each of the Vendor, COFCO (Hong Kong) Limited and COFCO (BVI) No.108 Limited is a wholly-owned subsidiary of COFCO Corporation and they are concert parties under the Takeovers Code. 2. The Placees and their ultimate beneficial owners are not associates of the Vendor or connected persons of the Company. 22