Fortunet e Commerce : Announcements and Notices - (1) Placing of New Shares under General Mandate and (2) Resumption of Trading

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 invitation or offer to acquire, purchase or subscribe for any securities of the Company.

鑫網易商集團有限公司

(Incorporated in the Cayman Islands with limited liability)

1. PLACING OF NEW SHARES UNDER GENERAL MANDATE AND
2. RESUMPTION OF TRADING

The Board announces that the Placing Agent and the Company have entered into the Placing Agreements whereby the Company agreed to place, through the Placing Agent, on a best effort basis, a maximum of 291,218,000 new Shares to independent Placees, at a price of HK$1.98 per Placing Share.

The maximum of 291,218,000 Placing Shares under the Placing represent approximately (i) 19% of the issued share capital of the Company as at the date of this announcement; and (ii) approximately 15.97% of the issued share capital of the Company as enlarged by the issue of a maximum of 291,218,000 Placing Shares.

The Placing Price of HK$1.98 per Placing Share represents (i) a premium of approximately 10% to the closing price of the Shares of HK$1.80 as quoted on the Stock Exchange on 12 December 2016; and

(ii) a premium of approximately 17.9% to the average closing price of the Shares of approximately HK$1.68 quoted on the Stock Exchange for the last five consecutive trading days immediately prior to 12 December 2016.

The gross proceeds from the Placing will be up to approximately HK$577 million and the net proceeds from the Placing will be up to approximately HK$570 million. The Company intends to use the net proceeds as the general working capital of the Group and for future investment pursuant to the investment objectives of the Company.

The Placing Shares are to be issued under the General Mandate granted to the Directors at the annual general meeting of the Company held on 20 May 2016.

The Placing is not subject to any additional Shareholders' approval.

The Board announces that the Placing Agent and the Company have entered into the Placing Agreements whereby the Company agreed to place, through the Placing Agent, on a best effort basis, a maximum of 291,218,000 new Shares to independent Placees, at a price of HK$1.98 per Placing Share.

The Placing Agent is an associate of Chance Talent Management Limited, the substantial shareholder of a subsidiary of the Company. As at the date of this announcement, as the total assets, profits and revenue of the subsidiary compared to that of the Company are less than 10% under the percentage ratios, the subsidiary is an insignificant subsidiary of the Company and thus not classified as connected person of the Company. Save as disclosed above, to the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Placing Agent and its ultimate beneficial owners are parties independent of the Company and connected persons (as defined in the Listing Rules) of the Company as at the date of this announcement.

The Placing Shares will be placed to Placees, who and whose ultimate beneficial owners are third parties independent of and not connected with the Company and its connected persons. It is expected that none of the Placees and their respective associates will become a substantial Shareholder of the Company as a result of the Placing.

As at the date of this announcement, the Company has been advised by the Placing Agent that there is one Placee, which has committed to subscribe for 138,888,000 Placing Shares, representing approximately (i) 9.06% of the issued share capital of the Company as at the date of this announcement;

(ii) 8.3% of the issued share capital of the Company as enlarged by the issue of the 138,888,000 Placing Shares; and (iii) 7.6% of the issued share capital of the Company as enlarged by the issue of a maximum

of 291,218,000 Placing Shares. Based on enquiries made by the Company, the Placee is Taiping Trustees Limited, which is a company incorporated in Hong Kong, and principally engaged in trust business. Its ultimate controlling shareholder is China Taiping Insurance Group Co. ("China Taiping"). China Taiping is a PRC state-owned financial and insurance group, and is currently the longest standing national brand in China's insurance industry. Its business covers life insurance, general insurance, pension plans, reinsurance, securities brokerage, asset management and non-financial investment, and its operations has presence in many countries and regions including the PRC, Hong Kong, Macau, Europe, Oceania, East Asia and South Asia. To the best knowledge, information and belief of the Directors having made all reasonable enquiries, Taiping Trustees Limited and its ultimate beneficial owners are parties independent of the Company and its connected persons (as defined in the Listing Rules) of the Company as at the date of this announcement.

Pursuant to the Placing Agreements, the Placing Agent agreed to procure, on a best effort basis, Placees to subscribe for a maximum of 291,218,000 Placing Shares at the Placing Price. The maximum of 291,218,000 Placing Shares represent approximately (i) 19% of the issued share capital of the Company as at the date of this announcement; and (ii) approximately 15.97% of the issued share capital of the Company as enlarged by the issue of a maximum of 291,218,000 Placing Shares. The aggregate nominal value of the maximum number of 291,218,000 Placing Shares is US$2,912,180.

The Placing Shares under the Placing will rank, upon issue, pari passu in all respects with the Shares in issue on the date of allotment and issue of the Placing Shares.

The Placing Price of HK$1.98 per Placing Share represents (i) a premium of approximately 10% to the closing price of the Shares of HK$1.8 quoted on the Stock Exchange on 12 December 2016; and

(ii) a premium of approximately 17.9% to the average closing price of the Shares of approximately HK$1.68 quoted on the Stock Exchange for the last five consecutive trading days immediately prior to 12 December 2016.

The net placing price for the Placing is approximately HK$1.96 per Share.

The Placing Price was negotiated on arm's length basis between the Company and the Placing Agent with reference to current market price of the Shares. The Directors consider that the terms of the Placing are fair and reasonable and the Placing is in the interests of the Company and the Shareholders as a whole.

The Placing Agent will receive a fee of HK$200,000 upon the execution of the Placing Agreement and a placing commission calculated as 1% of the amount equal to the Placing Price multiplied by the actual number of the Placing Shares.

Completion of the Placing is conditional upon, among other things, the Listing Committee of the Stock Exchange granting approval for the listing of, and permission to deal in, the Placing Shares.

If the conditions are not fulfilled on or prior to the Long Stop Date, the Placing Agreement and all the obligations thereunder will terminate and no party shall have any claim against any other party in respect of any matter arising out of or in connection with the Placing Agreement except for any breach arising prior to such termination.

Application will be made by the Company to the Listing Committee of the Stock Exchange for the grant of the listing of, and permission to deal in, the Placing Shares.

The Placing Agreements may be terminated if:

1. in the reasonable opinion of the Placing Agent there shall have been since the date of the Placing Agreement, such a change in national or international financial, political or economic conditions or taxation or exchange controls as would be likely to prejudice materially the consummation of the Placing; or

2. any breach of any of the representations and warranties set out in the Placing Agreements comes to the knowledge of the Placing Agent or any event occurs or any matter arises on or after the date hereof and prior to the Closing Date which if it had occurred or arisen before the date of the Placing Agreement would have rendered any of such representations and warranties untrue or incorrect in any respect or there has been a material breach by the Company of any other provision of the Placing Agreement; or

3. there is any adverse change in the financial position of the Company which in the reasonable opinion of the Placing Agent is material in the context of the Placing.

The Placing Shares will be allotted and issued under the General Mandate granted to the Directors by a resolution of the Shares passed at the AGM subject to the limit of up to 20% of the issued share capital of the Company as at the date of the AGM (i.e. 306,545,454 Shares, representing 20% of 1,532,727,272 Shares in issue as at the date of the AGM).

Up to the date of this announcement, no Shares have been allotted and issued under the General Mandate. The Placing Shares to be allotted and issued will utilise the full capacity of the General Mandate. The Placing is not subject to any additional Shareholders' approval.