09:57 RUILI HOLD<00491> - Announcement (1) The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. RUILI HOLDINGS LIMITED (Incorporated in Bermuda with limited liability) (Stock Code: 491) (website: http://www.irasia.com/listco/hk/ruili) DESPATCH OF CIRCULAR The Board announces that the circular containing further details in relation to, among other things, the proposed Share Consolidation, the Placing and proposed increase in authorized share capital, together with the notice of the SGM to be held on 17 December 2004, will be despatched to the Shareholders on 1 December 2004 together with the relevant form of proxy for use at the SGM. As a result of the full conversion of the 2003 Convertible Bonds by the holder on 29 November 2004, the Company has revised the use of proceeds received from the Placing as set out in this announcement. Reference is made to (i) the announcement of the Company dated 12 November 2004 in relation to, among other things, the Placing and the proposed increase in the authorized share capital of the Company (the "Placing Announcement"); and (ii) the announcement of the Company dated 18 November 2004 in relation to, among other things, the proposed Share Consolidation (the "Share Consolidation Announcement"). Capitalised terms used in this announcement have the same meanings as defined in the Placing Announcement and the Share Consolidation Announcement unless defined otherwise herein. DESPATCH OF CIRCULAR The Board announces that a circular (the "Circular") containing, among other things, (i) further details of the Share Consolidation; (ii) further details of the Placing Agreement (as amended by the Supplemental Agreement) and the proposed increase in the authorized share capital of the Company; and (iii) a notice convening the SGM will be despatched to the Shareholders on 1 December 2004 together with the relevant form of proxy for use at the SGM. CONVERSION OF THE 2003 CONVERTIBLE BONDS AND exercise of THE SHARE OPTIONS As at the date of the Placing Announcement, the principal amount of the 2003 Convertible Bonds outstanding was HK$16 million and the number of Shares to be issued under the Share Options was 50,000,000. As stated in the Circular, on 29 November 2004, the Company received the exercise notices from the holders of the 2003 Convertible Bonds and the Share Options to fully exercise the conversion rights and exercise rights attached to the 2003 Convertible Bonds and the Share Options respectively. Based on a conversion price of HK$0.018 per Share for the 2003 Convertible Bonds, a total of 888,888,888 new Shares were duly issued and allotted by the Company on 29 November 2004 in accordance with the terms of the 2003 Convertible Bonds. In addition, based on an exercise price of HK$0.017 per Share for the Share Options, a total of 50,000,000 new Shares will be issued and allotted by the Company in accordance with the rules of the Share Option Scheme. The following table is extracted from the Circular, which sets out the shareholding structure of the Company (i) as at the date of the Placing Announcement; (ii) as at 29 November 2004 ("Latest Practicable Date"), which is the latest practicable date prior to the printing of the Circular for ascertaining certain information therein, and assuming that the Shares under the Share Options are duly issued and allotted; (iii) immediately upon the Share Consolidation becoming effective; and (iv) upon the Share Consolidation becoming effective and immediately after Completion, assuming that all the Placing Shares are successfully placed by the Placing Agent. As at the Latest Practicable Date Upon the Share and assuming Immediately Consolidation As at the date the Shares under upon the Share becoming effective of the Placing the Share Options Consolidation and immediately Announcement are fully allotted becoming effective after Completion Consolidated Consolidated Shares % Shares % Shares % Shares %