09:17 XIN CORP<01141> - Announcement & Resumption (6) Upon completion of the Open Offer Shareholders As at the date of this announcement and prior to the Open Offer Assuming no conversion of the Convertible Bonds Assuming full conversion of the Convertible Bonds Vision Century 682,095,950 61.9% 1,023,143,925 61.9% 1,023,143,925 61.9% 1,023,143,925 61.4% 1,023,143,925 61.4% Directors of the subsidiaries of the Company 16,000 0.0% 24,000 0.0% 16,000 0.0% 24,000 0.0% 16,000 0.0% The Underwriter and/or the subscribers procured by it 0 0.0% 0 0.0% 210,312,120 12.7% 0 0.0% 214,766,607 12.9% Independent Shareholders 420,608,240 38.1% 630,912,360 38.1% 420,608,240 25.4% 644,275,822 38.6% 429,517,215 25.7% ----------------------------------------------------- Total 1,102,720,190 100.0% 1,654,080,285 100.0% 1,654,080,285 100.0% 1,667,443,747 100.0% 1,667,443,747 100.0% ===================================================== (Note a) (Note b) (Note a) (Note b) Notes: (a) Assuming that all Independent Shareholders and the directors of certain subsidiaries of the Company take up their assured entitlements under the Open Offer. (b) Assuming neither Independent Shareholders nor the directors of certain subsidiaries of the Company take up their assured entitlements under the Open Offer and all the underwritten Offer Shares taken up by the Underwriter or the subscribers procured by it. It is stated in the Underwriting Agreement that any subscribers procured by the Underwriter will be independent of, and not connected with the Company and its connected persons (as defined under the Listing Rules). REASONS FOR THE OPEN OFFER AND USE OF PROCEEDS The principal activities of the Group are (i) the provision of supply and procurement business; and (ii) the design, manufacture and sale of a wide range of toys. For the year ended 31st March, 2004, the Group recorded an audited consolidated net loss of approximately HK$30.9 million. For the six months ended 30th September, 2004, the Group recorded an unaudited net loss of approximately HK$9.2 million. The Directors are of the view that with the recent improving equity market conditions, it is in the interest of the Company to raise equity capital to strengthen the Group's financial position and enlarge its capital base. Net proceeds of the Open Offer of approximately HK$21.0 million are intended to be applied as to approximately HK$16.0 million for the repayment of the liabilities outstanding (including the Convertible Bonds and other liabilities of the Group) and as to the remainder of approximately HK$5.0 million for general working capital of the Group. The Directors believe that the Open Offer is in the interest of the Group and the Shareholders given that the Open Offer will increase the asset base of the Group and provide it with additional working capital. The Company did not conduct any fund raising activities in the past 12 months. ADJUSTMENT OF CONVERSION PRICE OF THE CONVERTIBLE BONDS Subject to the Open Offer becoming unconditional, the conversion price of the Convertible Bonds may be required to be adjusted in accordance with their terms as a result of the Open Offer. Further announcement will be made by the Company relating to any required adjustment following the determination of the number of Offer Shares. RESUMPTION OF TRADING IN SHARES At the request of the Company, trading in Shares on the Stock Exchange was suspended from 9:30 a.m. on Friday, 14th January, 2005 pending the release of this announcement. Application has been made by the Company for the resumption of trading in Shares with effect from 9:30 a.m. on Monday, 17th January, 2005.