Jia Yao : Announcements and Notices - Placing of Convertible Notes under General Mandate

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 Shares or other securities of the Company.

Jia Yao Holdings Limited

嘉 耀 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 01626)

PLACING OF CONVERTIBLE NOTES UNDER GENERAL MANDATE

Placing Agent

First Shanghai Securities Limited

On 15 September 2017 (after trading hours), the Company entered into the Placing Agreement with the Placing Agent pursuant to which the Company conditionally agreed to issue, and the Placing Agent conditionally agreed to procure Placees, on a best efforts basis, to subscribe for the Convertible Notes with the principal amount of up to HK$120,000,000 at a consideration equal to the aggregate principal amount of the Convertible Notes, and at the initial Conversion Price of HK$2.00 to HK$2.10 per Share.

As at the date of this announcement, the Company has a total of 300,000,000 Shares in issue. Assuming that (i) there is no further allotment and issue or repurchase of the Shares; (ii) HK$120,000,000 in principal amount of Convertible Notes are issued by the Company; and (iii) there is full conversion of the Convertible Notes based on the initial minimum Conversion Price of HK$2.00 per Share, a maximum number of 60,000,000 Conversion Shares will be allotted and issued, which represent approximately 20% of the existing issued share capital of the Company as at the date of this announcement and approximately 16.67% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares.

The Conversion Shares will be allotted and issued under the General Mandate and the allotment and issue of the Conversion Shares is not subject to the approval of the Shareholders.

Assuming the Convertible Notes in the principal amount of HK$120,000,000 is issued in full under the Placing, the net proceeds from the Placing are estimated to be approximately HK$117 million.

Completion of the Placing is subject to the fulfilment of the conditions precedent provided for in the paragraph headed ''The Placing Agreement - Conditions Precedent'' below. As the Placing may or may not proceed, Shareholders and potential investors are advised to exercise caution when dealing in the Shares.

THE PLACING AGREEMENT

On 15 September 2017 (after trading hours), the Company entered into the Placing Agreement with the Placing Agent pursuant to which the Company conditionally agreed to issue, and the Placing Agent conditionally agreed to procure Placees, on a best efforts basis, to subscribe for the Convertible Notes.

Principal terms of the Placing Agreement are set out as follows:

Date:

15 September 2017 (after trading hours)

Parties:

1. the Company, as the Issuer

2. First Shanghai Securities Limited, as the sole Placing Agent

   To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, the Placing Agent and its ultimate beneficial owner(s) are Independent Third Parties.

   Placing of Convertible Notes

   Pursuant to the Placing Agreement, the Company conditionally agreed to issue, and the Placing Agent conditionally agreed to procure Placees, on a best efforts basis, to subscribe for the Convertible Notes with the principal amount of up to HK$120,000,000 at a consideration equal to the aggregate principal amount of the Convertible Notes, and at the initial Conversion Price of HK$2.00 to HK$2.10 per Share.

   Placees

   The Placing Agent shall use its best endeavours to ensure that each Placee and its ultimate beneficial owners shall be Independent Third Parties and not connected persons of the Company.

   Conditions Precedent

   Completion of the Placing is conditional upon:

3. the Listing Committee granting approval for the listing of, and permission to deal in all the Conversion Shares; and

4. the initial conversion price for the Convertible Notes having been agreed by the Company and the Placing Agent and which shall be an initial price of not less than HK$2.00 and not more than HK$2.10 per Share.

If the conditions precedent of the Placing Agreement are not fulfilled on or before the date falling fourteen (14) Business Days from the date of the Placing Agreement (or such other date as may be agreed between the Company and the Placing Agent in writing), the Placing Agreement will cease and terminate and neither the Company nor the Placing Agent shall have any claim against each other, save for any antecedent breach.

Completion

Subject to the fulfilment of the conditions precedent and performance by the Placing Agent of its obligations under the Placing Agreement, completion of the Placing will take place on the date falling within five (5) Business Days following the fulfillment of the conditions precedent under the Placing Agreement or such other date as agreed in writing by the Company and the Placing Agent.

Termination

Pursuant to the Placing Agreement, in the reasonable opinion of the Placing Agent, and among others:

1. if, at or prior to the Completion, the Company commits any material breach of or omits to observe in any material respect any of the obligations assumed by it under the Placing Agreement or the Placing Agent shall receive notification or shall become aware of, the fact that any of the warranties or any other representations on the part of the Company contained in the Placing Agreement was, when given, untrue or inaccurate or would be untrue or inaccurate in any material respect if repeated as at Completion; or

2. any change in market conditions or combination of circumstances in Hong Kong (including without limitation suspension or material restriction or trading in securities) occurs which affect the success of the Placing or otherwise makes it inexpedient or inadvisable or inappropriate for the Company or the Placing Agent to proceed with the Placing; or

3. the success of the placing would be materially adversely affected by:

4. the introduction of any new law or regulation or any change in existing law or regulation which may materially adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

5. the occurrence of any local, national or international event or change of a political, military, financial, economic, currency or other nature, which materially adversely affects the business or the financial or trading position or prospects of the Group as a whole or materially adversely prejudices the success of the Placing or otherwise makes it inexpedient or inadvisable for the Company or the Placing Agent to proceed with the Placing,

   the Placing Agent may terminate the Placing Agreement by notice in writing given to the Company to elect to treat such matter or event as releasing and discharging the Placing Agent from its obligations under the Placing Agreement.

   PRINCIPAL TERMS OF THE CONVERTIBLE NOTES

   Issuer: The Company

   Principal amount: Up to HK$120,000,000

   Issue price: The aggregate principal amount of the Convertible Notes

   Maturity date: The date falling 24 months from the date of the issue of the

   Convertible Notes (the ''Maturity Date'').

   Interest rate: The Convertible Notes bear interest from the date of issue of the Convertible Notes at 4.80% per annum and is payable annually.

   Conversion Price: The initial price which is not less than HK$2.00 and not

   more than HK$2.10 per Share to be agreed by the Company and the Placing Agent before Completion, subject to the adjustments as set out and in accordance with the terms and conditions of the Convertible Notes.

   The maximun initial Conversion Price of HK$2.10 per Share:

6. represents a premium of approximately 25% to the closing price of HK$1.68 per Share as quoted on the Stock Exchange on 15 September 2017, being the date of the Placing Agreement; and

7. represents a premium of approximately 10.88% to the average closing price of HK$1.894 per Share as quoted on the Stock Exchange for the last five consecutive trading days immediately before the date of the Placing Agreement.