Dated 10 April 2012 (1) VINDA INTERNATIONAL HOLDINGS LIMITED. and (2) THE VENDOR NAMED IN SCHEDULE 2. and (3) MERRILL LYNCH FAR EAST LIMITED

Transcription

1 EXECUTION VERSION Dated 10 April 2012 (1) VINDA INTERNATIONAL HOLDINGS LIMITED and (2) THE VENDOR NAMED IN SCHEDULE 2 and (3) MERRILL LYNCH FAR EAST LIMITED PLACING AGREEMENT relating to Shares in the capital of VINDA INTERNATIONAL HOLDINGS LIMITED

2 Contents Clause Heading Page 1 DEFINITIONS AND INTERPRETATION APPOINTMENT OF THE PLACING AGENT AND THE PLACING CONDITION AND COMPLETION OF THE PLACING UNDERTAKINGS PAYMENT OF FEES, COMMISSIONS AND EXPENSES REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS INDEMNITY TERMINATION ANNOUNCEMENTS TIME OF THE ESSENCE NOTICES MISCELLANEOUS APPLICABLE LAW AND JURISDICTION SCHEDULE 1 PROFESSIONAL INVESTOR TREATMENT NOTICE SCHEDULE 2 THE VENDOR APPENDIX LETTER OF INSTRUCTION... 31

3 THIS PLACING AGREEMENT is made on 10 April 2012 BETWEEN: (1) VINDA INTERNATIONAL HOLDINGS LIMITED, a company duly incorporated in the Cayman Islands whose registered office is at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111, Cayman Islands (the Company ); (2) THE VENDOR NAMED IN SCHEDULE 2 (the Vendor ); and (3) MERRILL LYNCH FAR EAST LIMITED, a company duly incorporated in Hong Kong whose registered office is at 15/F, Citibank Tower, 3 Garden Road, Central, Hong Kong (the Placing Agent ). WHEREAS: (A) (B) (C) (D) (E) At the date hereof, the Company has an authorised share capital of HK$8,000,000,000 divided into 80,000,000,000 ordinary shares of HK$0.1 each (the Shares ), of which 957,234,686 Shares have been issued and are fully paid up or credited as fully paid and are beneficially owned as to 284,206,235 Shares by the Vendor including the Placing Shares (as defined below). All of the issued Shares are currently listed on the Stock Exchange (as defined below). The Vendor has agreed to appoint the Placing Agent and the Placing Agent agrees to act as placing agent for the purpose of procuring, as agent of the Vendor, on a best efforts basis, purchasers for the Placing Shares on the terms and subject to the conditions herein contained. As part of the arrangements for the Placing (as defined below), the Vendor has separately agreed to subscribe for, and the Company has agreed to allot and issue to the Vendor, up to 42,000,000 Shares (the Share Subscription ) on the terms and conditions contained in the Subscription Agreement (as defined below). The Company has agreed to enter into this Agreement (as defined below) on certain matters relating to the Placing Shares which are placed by the Vendor for the sole purpose of facilitating completion of the Subscription Agreement. NOW IT IS HEREBY AGREED as follows: 1 DEFINITIONS AND INTERPRETATION 1.1 In this Agreement (including the recitals), the following expressions shall, unless the context requires otherwise, have the following meanings: Affiliate means any person that directly or indirectly controls or is controlled by, or is under common control with the Vendor, including, without limitation, the Company; Agreement means this placing agreement (as may be amended or varied from time to time by an agreement in writing duly executed by the Parties); Announcement means the announcement in the agreed form to be issued by the Company as soon as possible following the execution of this Agreement; Associate has the meaning ascribed thereto in the Listing Rules; 1

4 Business Day means any day (excluding a Saturday or Sunday or public holiday in Hong Kong) on which banks are generally open for business in Hong Kong; CCASS means the Central Clearing and Settlement System operated by Hong Kong Securities Clearing Company Limited; Closing Date means two Business Days after the Trade Date (i.e., 13 April 2012) or such other date as the Vendor and the Placing Agent may agree in writing; Companies Ordinance means the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) for the time being in force; Directors means the directors of the Company for the time being; General Rules means the General Rules of CCASS from time to time in force; Group means the Company and its subsidiaries and the expression member of the Group shall be construed accordingly; HK$ means Hong Kong dollars, the lawful currency of Hong Kong; Hong Kong means the Hong Kong Special Administrative Region of the People s Republic of China; Investment Company Act means the U.S. Investment Company Act of 1940, as amended; Listing Committee means the listing sub-committee of the board of directors of the Stock Exchange; Listing Rules means the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the time being in force; Operational Procedures means the Operational Procedures of Hong Kong Securities Clearing Company Limited in relation to CCASS from time to time in force; Participant means a person admitted for the time being by Hong Kong Securities Clearing Company Limited as a participant of CCASS; Parties means the named parties to this Agreement and their respective successors and permitted assigns and Party means each one of them; Placee means any professional institutional and other investor whom the Placing Agent has procured to purchase any of the Placing Shares pursuant to its obligations hereunder; Placing means the private placing by or on behalf of the Placing Agent of the Placing Shares on the terms and subject to the conditions set out in this Agreement; Placing Period means the period commencing upon the execution of this Agreement and terminating at 4:00 p.m. (Hong Kong time) on the Closing Date (or such later time and date as the Vendor and the Placing Agent may agree in writing); Placing Price means the Placing Price specified in the Terms of Sale; Placing Shares means up to 42,000,000 Shares to be sold by the Vendor pursuant to Clause 2.1; 2

5 PRC means the People s Republic of China, which for the purpose of this Agreement excludes Hong Kong, the Macau Special Administrative Region of the People s Republic of China and Taiwan; Professional Investor Treatment Notice means the notice from the Placing Agent in the form set out in Schedule 1 to this Agreement; Regulation D means Regulation D under the Securities Act; Regulation S means Regulation S under the Securities Act; Rule 144A means Rule 144A under the Securities Act; Securities Act means the U.S. Securities Act of 1933, as amended; Seller has the meaning ascribed in Clause 2.2; SFC means the Securities and Futures Commission in Hong Kong; SFO means the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) for the time being in force; Share Subscription has the meaning given to it in recital (D) of this Agreement; Stock Exchange means The Stock Exchange of Hong Kong Limited; Subscription Agreement means the subscription agreement dated 10 April 2012 entered into between the Company and the Vendor in relation to the subscription of the Subscription Shares by the Vendor; Subscription Shares means up to a maximum of 42,000,000 new Shares to be issued to the Vendor pursuant to the Subscription Agreement; subsidiary has the same meaning as in Sections 2 and 2B of the Companies Ordinance; Takeovers Code means the Hong Kong Code on Takeovers and Mergers issued by the SFC; Taxation and Tax mean all forms of taxation whether of Hong Kong or elsewhere in the world whenever imposed and all statutory, governmental, state, provincial, local governmental or municipal impositions, duties and levies and all penalties, charges, costs and interests relating thereto; Terms of Sale has the meaning given to it in Clause 2.1; Trade Date means the date when the sale of the Placing Shares shall be reported as a cross-trade to the Stock Exchange which shall be 11 April 2012 or, (ii) if dealings in the Shares on the Stock Exchange are suspended at all times on 11 April 2012, the first day on which dealings resume and the cross-trade can be reported to the Stock Exchange in accordance with its rules, or such other date as the Vendor and the Placing Agent may agree in writing; and U.S. means the United States of America, its territories and possessions, any State of the United States, and the District of Columbia. 1.2 Any reference to a document being in the agreed form means in the form of the draft thereof signed for identification on behalf of the Company, the Vendor and the Placing Agent with such alterations (if any) as may be agreed between the Parties. 3

6 1.3 In this Agreement, references to any statute, statutory provision, Listing Rule or a rule of the Takeovers Code include a reference to that statute, statutory provision, Listing Rule or rule of the Takeovers Code as from time to time amended, extended or re-enacted. 1.4 In this Agreement, references to persons include references to bodies corporate, references to singular include references to the plural and vice versa; and words denoting one gender only shall include other genders. 1.5 Headings are inserted for convenience only and shall not affect the interpretation of this Agreement. 1.6 All references in this Agreement in relation to any time, date or period shall mean Hong Kong time. 1.7 References to Clauses, Sub-clauses and Schedules are references to clauses and subclauses of and schedules to this Agreement. 2 APPOINTMENT OF THE PLACING AGENT AND THE PLACING 2.1 Subject to the provisions of this Agreement, the Vendor hereby appoints the Placing Agent as its agent to the exclusion of all others and the Placing Agent, relying on the representations, warranties and undertakings herein contained and subject to the conditions as hereinafter mentioned, agrees to act as agent for the Vendor during the Placing Period to procure, on a best efforts basis, purchasers for the Placing Shares at the Placing Price (together with such Hong Kong stamp duty, brokerage, SFC transaction levy and Stock Exchange trading fee payable by the purchasers) on terms and subject to the conditions set out in this Agreement. The final number of Placing Shares to be sold and the Placing Price will be subject to agreement by the parties at pricing and as set out in the terms of sale, substantially in the form attached in Schedule 3, executed by the parties at pricing (the Terms of Sale ). 2.2 Notwithstanding Clause 2.1, at any time during the Placing Period the Placing Agent may elect that some or all of the Placing Shares be purchased by it and/or its nominee(s) as principal from the Vendor at the Placing Price and, in that event, the Placing Shares may subsequently be sold by the Placing Agent and/or its nominee(s) (each, a Seller ) as principal to purchasers at any price(s) as the Seller in its discretion may determine, without being under any obligation to notify the Vendor of such election or of the number of Placing Shares so purchased as principal, or of the price(s) at which those Shares are sold to purchasers provided that any stamp duty payable in respect of such sale by a Seller as principal shall be borne by the relevant Seller. 2.3 The Vendor hereby confirms that the appointment set forth in Clause 2.1 confers on the Placing Agent all powers, authorities and discretions on behalf of the Vendor which are reasonably and properly necessary for, or reasonably incidental to, the making of the Placing (including, without limiting the foregoing, the completion of the relevant contract notes on behalf of the Vendor and the submission of such contract notes and other documents for stamping) and hereby agrees to ratify and confirm all acts which the Placing Agent has lawfully and properly done prior to the date of this Agreement in relation to the Placing or may do in the exercise of such powers, authorities and discretions in accordance with this Agreement. 4

7 2.4 The Vendor shall sell the Placing Shares pursuant to the Placing free from all liens, charges and encumbrances, and together with all rights attaching to them as at the Closing Date, including the right to receive all dividends declared, made or paid on or after the Closing Date. 2.5 The Placing Shares shall be offered to Placees in board lots of 1,000 Shares. The choice of Placees for the Placing Shares shall be determined solely by the Placing Agent, subject to the requirements of the Listing Rules, all applicable laws, rules and regulations and the terms of this Agreement, and the Placing Agent shall not, as far as it is aware, place any of the Placing Shares to any connected person of the Company (as defined in the Listing Rules). Each of the Vendor and the Company shall inform the Placing Agent as soon as possible if it is aware of any intention by any connected person of the Company or any Associates of the Vendor to acquire any of the Placing Shares. 2.6 The Placing Agent may select brokers of its choice to report placing of the Placing Shares to the Stock Exchange and to effect the placing of the Placing Shares on the Stock Exchange as a crossing on the Stock Exchange. 2.7 The Parties agree that the Placing shall be made (i) in the U.S. to qualified institutional buyers in compliance with the exemption from registration provided by Rule 144A and (ii) outside the U.S. in transactions that comply with Regulation S. 3 CONDITION AND COMPLETION OF THE PLACING 3.1 The obligation of the Placing Agent to proceed to complete the Placing is conditional upon the Subscription Agreement having been entered into by the parties thereto. 3.2 To the extent that the Placing Shares (if any) are not already deposited and held in CCASS, the Vendor shall deliver share certificates in respect of the Placing Shares, together with an instrument of transfer in respect of the Placing Shares and such other necessary documentation to effect the deposit of the Placing Shares into CCASS, to the Placing Agent (or to such settlement agent (the Settlement Agent ) as the Placing Agent may direct) on or before 9:30 a.m. on the Business Day immediately following the date of this Agreement (or such other time and date as may be agreed between the Vendor and the Placing Agent). The Vendor shall complete and sign all necessary forms and documentation to effect the opening of a nominee account with the Placing Agent or the Settlement Agent (as the case may be). The Vendor shall authorise the Placing Agent or the Settlement Agent (as the case may be) to deposit the Placing Shares into CCASS and shall appoint the Placing Agent or the Settlement Agent (as the case may be) to act as the Vendor s nominee to hold the Placing Shares pending completion of the Placing. 3.3 Completion of the Placing will take place on the Closing Date. Completion of the transfer of the Placing Shares shall take place in CCASS on a free of payment basis. At or before 4:00 p.m. on the Closing Date, the Vendor shall procure that its designated Participant(s) (including, where applicable, the Placing Agent or the Settlement Agent) input(s) free of payment delivery instructions in CCASS to deliver the relevant number of Placing Shares for which purchasers have been procured on completion of the Placing in accordance with this Agreement and the General Rules and the Operational Procedures to the CCASS stock accounts of the relevant Participant(s) of the Placing Agent. 5

8 3.4 The Vendor shall procure that the Placing Shares delivered at completion of the Placing in accordance with the preceding provisions of this Clause 3 shall comply in all respects with Clause Against compliance by the Vendor with its obligations pursuant to Clauses 3.2 and 3.3 and subject to Clause 8, the Placing Agent shall on the Closing Date make or procure the making of payment to the Vendor in Hong Kong dollars of the aggregate Placing Price of the number of Placing Shares for which it has procured purchasers (less the commission and expenses, including, but not limited to, transaction fees payable to the Placing Agent, the applicable stamp duty, the SFC transaction levy, and the Stock Exchange trading fee payable by the Vendor referred to in Clause 5), the payment of which shall constitute a complete discharge of the obligation of the Placing Agent to use its best efforts to procure the purchase of the Placing Shares hereunder. Such payment shall be made for value on the Closing Date and to such bank account(s) of the Company held with a licensed bank in Hong Kong as may be notified by the Vendor to the Placing Agent at least one Business Day before the Closing Date. The Vendor acknowledges that payment to such bank account(s) of the Company shall constitute full and final discharge of the Placing Agent s obligations to pay the purchase monies to the Vendor hereunder. The Vendor shall execute a letter of instruction at least one Business Day before the Closing Date in the form set out in the Appendix hereto evidencing such notification and acknowledgement by the Vendor. 3.6 The Vendor hereby acknowledges that the Placing Agent in performing its obligations and functions under Clauses 2 and 5, is authorised to appoint one or more sub-placing or subunderwriting agents or selling agents to be its delegate in respect of all or any of its relevant rights, duties, powers and discretions in such manner and on such terms as it thinks fit (with or without formality and without prior notice of any such delegation being required to be given to the Vendor) and hereby agrees to ratify and confirm all acts which such agents have lawfully and properly done prior to the date of this Agreement in relation to the Placing or may lawfully and properly do in the exercise of such powers, authorities and discretions in accordance with this Agreement. All fees of such agents shall be paid and borne by the Placing Agent, whether out of the commissions, costs, charges and expenses payable by the Vendor under Clause 5 or otherwise. 3.7 Any transaction carried out by the Placing Agent (and any agents referred to in Clause 3.6) under and in accordance with this Agreement on behalf of the Vendor shall constitute a transaction carried out at the request of the Vendor, as its agent and not in respect of or for the benefit of the Placing Agent s own account and the Placing Agent shall not be responsible to third parties for any loss or damage to any such persons arising from any such transaction. 3.8 The Placing Shares shall be offered by the Placing Agent as agent for the Vendor at the Placing Price (together with such Hong Kong stamp duty, brokerage, SFC transaction levy and Stock Exchange trading fee payable by purchasers) during the Placing Period. 3.9 The Company and the Vendor hereby acknowledge and agree that (i) the Placing of the Placing Shares pursuant to this Agreement, including the determination of the pricing of the Placing Shares and any related discounts and commissions, is an arm's-length commercial transaction among the Company and the Vendor, on the one hand, and the Placing Agent, on the other hand, (ii) in connection with the Placing, the Placing Agent is not acting as a fiduciary, and owes no fiduciary duties, to the Company, the Vendor, or their 6

9 respective stockholders, creditors, employees or any other party, (iii) the Placing Agent has not assumed or will not assume any advisory or fiduciary responsibility in favour of the Company or the Vendor with respect to the Placing or the process leading thereto (irrespective of whether the Placing Agent has advised or is currently advising the Company or the Vendor on other matters) and the Placing Agent has no obligation to the Company or the Vendor with respect to the Placing or the Share Subscription (as the case may be) except the obligations expressly set forth in this Agreement, (iv) the Placing Agent and its affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and the Vendor, and (v) the Placing Agent has not provided any legal, accounting, regulatory or tax advice with respect to the Placing and each of the Company and the Vendor has consulted its own respective legal, accounting, regulatory and tax advisors to the extent it deemed appropriate. This Agreement supersedes any prior agreement or understanding (whether written or oral) among the parties hereto with respect to the subject matter of this Clause UNDERTAKINGS 4.1 The Company shall promptly make all notifications, registrations and filings as may from time to time be required in relation to the Placing Shares, the Subscription Shares and the transactions contemplated under this Agreement including, without prejudice to the generality of the foregoing, the filings with the Stock Exchange. 4.2 Each of the Vendor and the Company shall make all appropriate disclosures pursuant to, and will each comply in all respects with all applicable laws, regulations and directions (including without limitation the Listing Rules, the Takeovers Code and the SFO) and all requirements of the Stock Exchange, the SFC or any other applicable regulatory body in connection with the Placing. 4.3 Each of the Vendor and the Company shall promptly provide the Placing Agent, upon request, with all such information known to it or which on reasonable enquiry ought to be known to it relating to the Company and/or any other member of the Group or otherwise as may be required by the Placing Agent in connection with the Placing for the purpose of complying with any applicable law, regulation or direction (including the establishment of any defence to any action under any of the same, whether relating to due diligence or otherwise) or any requirement of the Stock Exchange, the SFC or any other applicable regulatory body; 4.4 Each of the Vendor and the Company shall procure that particulars of every significant new factor known to it which is capable of materially and adversely affecting the Placing and which arises between the date hereof and the Closing Date shall be promptly provided to the Placing Agent. 4.5 Without prejudice to the foregoing obligations, the Vendor and the Company each undertakes to the Placing Agent that it shall do all such other acts and things as may be reasonably required to be done by it to carry into effect the Placing in accordance with the terms of this Agreement. 4.6 The Vendor undertakes to the Placing Agent that (except for (i) the sale of the Placing Shares pursuant to this Agreement; (ii) the pledge of up to 272,000,000 Shares in aggregate by the Vendor in favour of (a) Hang Seng Bank Limited as security for a credit facility of HK$60,000,000 granted on 28 September 2009; (b) Bank Sarasin & Cie AG, 7

10 Hong Kong Branch as security for a credit facility of US$80,000,000; (c) Morgan Stanley as security for a credit facility of up to US$13,000,000; (d) JPMorgan Chase & Co. as security for a credit facility of up to US$10,000,000; and (e) Uob Kay Hian Finance Limited as security for a credit facility of up to US$20,000,000; (iii) the pledge of up to 19,012,000 additional Shares in aggregate by the Vendor (if and only to the extent that such Shares have been transferred to the Vendor from Mr. Li Chao Wang, Ms. Yu Yi Fang and/or Mr. Dong Yi Ping on or after the date of this Agreement) as security for additional borrowed money); and (iv) the sale of 46,900,000 Shares by the Vendor to SCA Hygiene Holding AB, for a period of 90 days from the Closing Date, it will not and will procure that none of its nominees and companies controlled by it and trusts associated with it (whether individually or together and whether directly or indirectly) will: 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 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 enter into any swap or similar agreement that transfers, in whole or in part, the economic risk of ownership of Shares, whether any such transaction described in Clauses or above is to be settled by delivery of Shares or such other securities, in cash or otherwise; or announce any intention to enter into or effect any such transaction described in Clauses or above, unless with the prior written consent of the Placing Agent. 4.7 The Company hereby acknowledges that the placing of up to 42,000,000 Placing Shares is to facilitate the Share Subscription upon completion of which the Company will receive the Subscription Monies (as defined in the Subscription Agreement). 4.8 The Company undertakes to the Placing Agent, and the Vendor undertakes to the Placing Agent to procure, that for a period of 90 days from the Closing Date, the Company will not, except for the Subscription Shares and save pursuant to (1) the terms of any employee share option scheme of the Company or (2) any subscription warrants or (3) 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: allot or issue or offer to allot or issue or grant any option, right or warrant to subscribe for (either conditionally or unconditionally, or directly or indirectly, or otherwise) any Share(s) or any interests in Shares or any securities convertible into or exercisable or exchangeable for or substantially similar to Shares or interest in Shares; or agree (conditionally or unconditionally) to enter into or effect any such transaction with the same economic effect as any of the transactions described in Clause above; or 8

11 4.8.3 announce any intention to enter into or effect any such transaction described in Clauses or above, without first having obtained the written consent of the Placing Agent. 4.9 Each of the Company and the Vendor undertakes to the Placing Agent that it will not vary the provisions of the Subscription Agreement without first having obtained the written consent of the Placing Agent. The expression vary shall include any variation, supplement, deletion or replacement however effected The undertakings under this Clause 4 shall remain in full force and effect notwithstanding completion of the Placing and the Share Subscription in accordance with their respective terms. 5 PAYMENT OF FEES, COMMISSIONS AND EXPENSES 5.1 In consideration of the services of the Placing Agent in relation to the Placing, the Vendor shall pay to the Placing Agent: a transaction fee, in Hong Kong dollars of 2 to 2.5 per cent. (such final transaction fee to be agreed in the Terms of Sale) of the amount equal to the Placing Price multiplied by the Placing Shares for which the Placing Agent has procured purchasers, which total amount the Placing Agent is hereby authorised to deduct from the payment to be made by it to the Vendor pursuant to Clause 3.5 and out of which the Placing Agent agrees to pay, or procure that Placees to pay, applicable stamp duty, brokerage fees, SFC transaction levy, Stock Exchange trading fee and all expenses of the Placing payable by the Placees other than those specified in this Clause 5.1 and in Clause 5.4; an equity structuring fee, in Hong Kong dollars, of 1.55 to 1.62 per cent. (such final equity structuring fee to be agreed in the Terms of Sale) of the amount equal to the Placing Price multiplied by the Placing Shares for which the Placing Agent has procured purchasers, which amount the Placing Agent is hereby authorised to deduct from the payment to be made by it to the Vendor pursuant to Clause 3.5; stamp duty at the rate of HK$1.00 per HK$1,000 or any part thereof on the amount equal to the Placing Price multiplied by the number of Placing Shares procured by the Placing Agent to be purchased by the Placees, which amount the Placing Agent is hereby authorised to deduct from the payments to be made by it to the Vendor pursuant to Clause 3.5; all costs and expenses incurred in connection with the deposit of the Placing Shares into CCASS pursuant to Clause 3.2, and, unless the Placing Shares are to be delivered in board lots or through CCASS, all charges, fees and expenses of the Company s share registrars in Hong Kong including (without limitation) their fees and expenses in effecting the transfer of the Placing Shares, and the issue of certificates therefor in board lots, to the Placees or, where applicable, the Placing Agent or its nominee(s), which amounts the Placing Agent is hereby authorised to deduct from the payments to be made by it to the Vendor pursuant to Clause 3.5 for the purposes of paying on the behalf of the Vendor such costs, charges, fees and expenses; 9

12 5.1.5 seller s SFC transaction levy at the prevailing applicable rate and seller s Stock Exchange trading fee at the prevailing applicable rate on the amount equal to the Placing Price multiplied by the number of Placing Shares procured by the Placing Agent to be purchased by the Placees, which amount the Placing Agent is hereby authorised to deduct from the payments to be made by it to the Vendor pursuant to Clause 3.5; and the costs and expenses incurred by the Placing Agent (including but not limited to legal costs) and agreed by the Company in connection with the Placing and the Placing Agent is hereby authorised to deduct such sums from the payments to be made by it to the Vendor pursuant to Clause The Vendor hereby acknowledges that, in addition to the commissions, costs, charges and expenses referred to in Clause 5.1, the Placing Agent shall be entitled to keep for its own account any brokerage fees or commission in excess of the Placing Price that they may receive from the Placees. 5.3 All sums payable by the Vendor or the Company under this Agreement shall be paid free and clear of any deductions, withholdings, set-offs or counterclaims (together Withholdings ), save only as may be required by law. If any Withholdings are required by law the Vendor or the Company (as the case may be) shall be obliged to pay such sum as will after such Withholding has been made leave the party to this Agreement receiving it with the same amount as such party would have been entitled to receive in the absence of a requirement to make a Withholding. 5.4 Each of the Vendor and the Company shall be liable for the costs and expenses of its own legal and other professional advisers and out-of-pocket expenses incurred in connection with the Placing and the Share Subscription. 5.5 All payments to be made by the Vendor to the Placing Agent pursuant to this Agreement shall be denominated in Hong Kong dollars. 5.6 If this Agreement is terminated pursuant to Clause 8 or if for any reason the Placing is not completed, the Vendor shall remain liable to the Placing Agent for the payment of all costs, charges and expenses referred to in Clauses and and for the stamp duty, the SFC transaction levy and Stock Exchange trading fee referred to in Clauses and to the extent already incurred. 6 REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS 6.1 In consideration of the Placing Agent entering into this Agreement and agreeing to perform its obligations hereunder, the Vendor hereby represents, warrants and undertakes to the Placing Agent as follows: the Vendor is the beneficial owner of the Placing Shares, and such Placing Shares are held in CCASS as at the date of this Agreement; the Placing Shares are fully paid up or credited as fully paid and the Vendor has the necessary power and authority to enable it to sell the Placing Shares hereunder free from any pledge, lien, charge, mortgage, security interest, adverse claim, option, warrant, pre-emptive right, or other encumbrance or third party right whatsoever and ranking pari passu in all respects with existing Shares and 10

13 together with all rights attaching thereto as at the Trade Date and the Company has not exercised any lien over any of the Placing Shares; all regulatory and judicial consents, approvals, orders or qualifications required to be obtained or made under all relevant jurisdictions for the sale of the Placing Shares or the consummation of the transactions contemplated by this Agreement have been duly obtained and are in full force and effect; the Vendor is duly incorporated and validly existing under the laws of the place of its incorporation and the Vendor has the power under its constitutional documents to enter into this Agreement and this Agreement (and its performance) has been duly authorised (such authorisation remaining in full force and effect) and executed by, and constitutes valid and legally binding and enforceable obligations of the Vendor in accordance with its terms; it shall, and shall procure the Company to, ensure that none of its Associates or parties acting in concert (as defined in the Takeovers Code) with it (or, in the case of the Company, its connected persons (as defined in the Listing Rules)), or any persons who are not independent of the Company, the Vendor or any of their respective Associates, shall purchase the Placing Shares; and it has read and understood the Professional Investor Treatment Notice and acknowledges and agrees to the representations, waivers and consents contained in the Professional Investor Treatment Notice, in which the expressions you or your shall mean the Vendor and us and our shall mean the Placing Agent. 6.2 Subject to Clause 6.3, the Vendor and the Company each hereby jointly and severally represents, warrants and undertakes to the Placing Agent as follows: as at the date of this Agreement, the Company has an authorised share capital of HK$8,000,000,000 divided into 80,000,000,000 shares of HK$0.1 each, of which 957,234,686 Shares have been issued and fully paid up or credited as fully paid, and all of the issued Shares are listed on the Stock Exchange; all statements of fact contained in the Announcement are true and accurate and not misleading; and all statements of opinion, intention or expectation or estimates of the Directors in relation to the Company and/or any other member of the Group contained therein (if any) are truly and honestly held and have been made on reasonable grounds after due and careful consideration, and there is no other fact or matter omitted therefrom the omission of which would make any statement therein untrue, inaccurate, misleading or which is otherwise material in the context of the Placing or the Share Subscription; none of the Vendor and the Company has engaged in any transactions with a view to or having the effect of manipulating the stock price of the Shares or dealing in the Shares while in possession of material non-public information; other than the Placing, the Share Subscription and the possible sale of shares by the Vendor to SCA Hygiene Holding AB, none of the Vendor or the Company is in possession of any non-public information relating to the Company, any other member of the Group or their respective businesses the release of which could materially affect the trading price of the Shares and there is not in existence any material or information relating to the Company which is required to be but has not been disclosed by the Company under the Listing Rules. Without prejudice to the 11

14 generality of the foregoing, there is no material information (including, without limitation, any information regarding any material adverse change or prospective material adverse change in the condition of, or any actual, pending or threatened litigation, arbitration or similar proceeding involving, the Group) that is not described in the Company s most recent annual report or subsequent public information releases (the Company Information ) which information is necessary to enable investors to make an informed assessment of the assets and liabilities, financial position, profits and losses and prospects of the Group; the Company Information does not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading; all information (whether oral, written, electronic or in any other form) supplied by or on behalf of the Vendor, the Company, any other member of the Group or any of their respective officers, directors, employees or advisers, for the purpose of or in connection with the Placing or the Share Subscription, the Vendor or the Company, and all publicly available information and records of the Vendor and the Company (including information contained in annual reports, statutory filings and registrations) is and was, when supplied or published, true and accurate in all material respects and not misleading in any material respect; there is no claim, litigation, arbitration, prosecution or other legal proceedings, order, decree, judgment, or investigation or enquiry outstanding, in progress, pending or threatened against any member of the Group or any of their respective directors, officers, vendors or affiliates, nor is there any claim or any facts or circumstances of a material nature which may give rise to a claim against any member of the Group or any of their respective directors, officers, vendors or affiliates, which in any such case would have or have had a material adverse effect on the condition, financial, trading or otherwise, or the earnings, business affairs or business prospects (whether or not arising in the ordinary course of business) of the Company or the Group as a whole or which is material in the context of the Placing or the Share Subscription; there has been no material adverse change, or any development involving or reasonably likely to involve a prospective material adverse change, in the condition, financial or otherwise, or the earnings, net assets, business affairs or business prospects (whether or not arising in the ordinary course of business) of the Company or the Group as a whole since 31 December 2011; each member of the Group is duly incorporated and validly existing under the laws of the place of its incorporation and each member of the Group has power to own its assets and to conduct its business in the manner presently conducted and there has been no petition filed, order made or effective resolution passed for the liquidation or winding up of any member of the Group; each member of the Group has obtained such authorisations and licences (if any) as are required under the provisions of any applicable law in connection with the operation of its business and there is no breach by any member of the Group of the provisions of any ordinance, statute or regulation governing such authorisations or licences nor is there any reason why any such authorisation or licence should be withdrawn or cancelled; 12

15 save as disclosed in the Company s announcements, the Vendor and the Company are not and have not been in breach of any provision of the Listing Rules or any rule, regulation or requirement of the Stock Exchange or any provision of the SFO or any rule of requirement of the SFC and in particular, each of the Vendor and the Company has complied at all times with the disclosure and other requirements under the Listing Rules and SFO and all necessary consents (if any) have been obtained from the Stock Exchange and other authority to complete the Placing and the Share Subscription in the manner contemplated; the Placing and the Share Subscription will not have any implications under the Takeovers Code and the Vendor will not be under any obligation to make a general offer under the Takeovers Code as a result of the Placing and the Share Subscription other than in respect of which the waiver under Clause of the Subscription Agreement is being obtained; there is no enquiry, investigation, order, decree or judgement of any court or governmental agency or regulatory body outstanding or anticipated against any Director or any member of the Group which may have or has had a material adverse effect upon the condition, financial or otherwise or the earnings, business affairs or business prospects (whether or not arising in the ordinary course of business) of the Company or the Group (taken as a whole) or which is material in the context of the Placing or the Share Subscription; no material outstanding indebtedness of any member of the Group has become payable or repayable by reason of any default of any member of the Group and no event has occurred or is impending which may result in such indebtedness becoming payable or repayable prior to its maturity date, in a demand being made for such indebtedness to be paid or repaid or in any step being taken to enforce any security for any such indebtedness of any member of the Group; no member of the Group is a party to or under any obligation which is material and which is of an unusual or unduly onerous nature; no member of the Group is in breach of or in default of its constitutional documents or any contract or agreement which may have or has had a material adverse effect upon the condition, financial or otherwise or the earnings, business affairs or business prospects (whether or not arising in the ordinary course of business) of the Company or of the Group (taken as a whole) or which is material in the context of the Placing or the Share Subscription; neither this Agreement nor the Placing or the Share Subscription will constitute or give rise to a breach of or default under the constitutional documents of or any agreement or other arrangement to which any member of the Group is party or give rise to any rights of any third party in respect of any assets of the Company or the Group; the information contained in any investor presentation materials (whether in physical, audio or electronic form) prepared by or on behalf of the Company for preliminary or presounding presentations (howsoever called) or presentations in connection with annual or interim results announcements since 31 December 2011, including but not limited to the annual results presentations for the financial year ended 31 December 2011, as well as any information supplied by or on behalf of the Company or contained in any presentations in connection herewith (the Investor Presentation Materials ) was, when made, given or supplied, and continues to be true and accurate in all material respects and was, when made, 13

16 given or supplied, and continues to be not misleading in any material respect; any opinions, expectations or intentions expressed in the Investor Presentation Materials were, when expressed and continue to be, honestly held or made, were not, when expressed, and continue to be misleading in any material respect, have been reached after due and careful consideration and were, when expressed and continue to be based on reasonable assumptions; the Investor Presentation Materials have not omitted and do not omit to state any fact necessary to make such information, opinions, expectations or intentions not misleading in any material respect; and all reasonable enquiries have been made to ascertain or verify the accuracy of the foregoing; the copy of the audited consolidated accounts of the Group for the financial year ended on 31 December 2010, the unaudited consolidated interim accounts of the Group for the six months ended 30 June 2011 and the consolidated financial information of the Group for the financial year ended 31 December 2011 included in the Company s announcement on the final results of the Group for the financial year ended 31 December 2011 which have been provided to the Placing Agent prior to the execution of this Agreement: (i) (ii) (iii) (iv) have been prepared on a recognised and consistent basis and in accordance with generally accepted accounting principles, standards and practice in Hong Kong; comply with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants, the Companies Ordinance, the Listing Rules and all other applicable ordinances, statutes and regulations and show a true and fair view of the state of affairs of the Group and of its results for the period in question; are not affected by any unusual or non-recurring items and do not include transactions not normally undertaken by any member of the Group (save as disclosed in the said relevant accounts); and make adequate provision for all Taxation whether in Hong Kong or any other part of the world in respect of all accounting periods ended on or before the respective date for which any member of the Group was then or might at any time thereafter become or have been liable; there are no material outstanding guarantees or contingent payment obligations of the Company in respect of indebtedness of third parties except as disclosed in the financial statements referred to in Clause which are material in the context of the Placing or the Share Subscription; and each member of the Group is in compliance with all of its obligations under any outstanding guarantees or contingent payment obligations as described in such financial statements; neither the Company nor any of its subsidiaries has any material relationships with unconsolidated entities that are contractually limited to narrow activities that facilitate the transfer of or access to assets by the Company, or any of its subsidiaries, such as structured finance entities and special purpose entities that could have a material effect on the liquidity of the Company or any of its subsidiaries or the availability thereof or the requirements of the Company or any of its subsidiaries for capital resources; 14

17 the Company has power under its constitutional documents to permit its entry into and performance of this Agreement in the manner set out herein and this Agreement (and its performance) has been duly authorised (such authorisation remaining in full force and effect) and executed by, and constitutes legally binding and enforceable obligations of the Company in accordance with its terms; there is no authorisation, consent, approval or notification required for the purposes of or as a consequence of the Placing or the Share Subscription either from governmental, regulatory or other public bodies (including, without limitation, the Stock Exchange) or authorities or courts or from any third party pursuant to any contractual or other arrangement to which the Company or any other member of the Group or the Vendor is a party; the execution and delivery of, and the performance by the Vendor and the Company of their respective obligations under this Agreement, and the compliance by the Vendor and the Company respectively with all of the provisions of this Agreement as well as the consummation of the transactions herein contemplated, do not and will not (i) conflict with or result in a breach or violation of, or result in any third party consent being required under, or result in the creation or imposition of any encumbrance on any of its assets under, any of the terms or provisions of their constitutional documents or any indenture, mortgage, deed of trust, loan agreement, other agreement or undertaking or instrument, decree, regulation or law to or by which the Company or any other member of the Group or the Vendor is a party or to which any of the property or assets of the Company or any other member of the Group or the Vendor is subject, or any statute or any order, rule or regulation, including, without limitation, to the extent applicable the Listing Rules or any judgement, decree or order of any court or governmental agency or body having jurisdiction over the Company or any other member of the Group or the Vendor or the property or assets of any member of the Group or the Vendor and (ii) have any implications under the Takeovers Code as a result of the Placing or the Share Subscription, other than in respect of which the waiver under Clause of the Subscription Agreement is being obtained; except for the employee share options of the Company in issue as at the date of this Agreement, no unissued share capital of any member of the Group is under any option or agreed conditionally or unconditionally to be put under any option and no person has an outstanding warrant, pre-emptive right or any other right of any description to require shares to be allotted or issued by any member of the Group; the operations of the Vendor, its Affiliates and each member of the Group are and have been conducted at all times in compliance with applicable laws and regulations against corrupt practices; none of the members of the Group, the Vendor and its Affiliates nor, to the knowledge of any of them, have their respective directors, officers, agents, employees, affiliates, or anyone working on their behalf taken any action, directly or indirectly, that would result in a violation by such persons of the U.S. Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the FCPA ) (including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorisation of the payment of any money, or other property, gift, promise to give, or authorisation of the giving 15

18 of anything of value to any foreign official (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA), the United Kingdom Bribery Act 2010 and the rules and regulations thereunder (the UK Bribery Act ) or any other applicable anti-corruption laws; members of the Group, the Vendor, and its Affiliates have conducted their businesses in compliance with the FCPA, the UK Bribery Act, and similar anti-corruption laws (to the extent that such laws are applicable), and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith; the operations of the Vendor, its Affiliates and each member of the Group are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the Money Laundering Laws ) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Vendor, its Affiliates and the Company with respect to the Money Laundering Laws is pending or, to the best knowledge of the Vendor, its Affiliates and the Company, threatened; each member of the Group complies in all respects with all applicable Environmental Laws, save where any non-compliance would not have a material adverse effect. For the purpose of this Clause , Environmental Laws means any and all supra-national, national, state, local and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licences, agreements or other governmental restrictions relating to the protection of the environment (including, without limitation, human, animal and plant life, ambient air, surface water, ground water, or land), the protection of property and proprietary rights or for the compensation of harm to the environment whether by clean-up, remediation, containment or other treatment or the payment of monies to any competent authority; the Company has read and understood the Professional Investor Treatment Notice and acknowledges and agrees to the representations, waivers and consents contained in the Professional Investor Treatment Notice, in which the expressions you or your shall mean the Company, and us or our shall mean the Placing Agent; none of the Vendor and the Company has been, is or will be at any time engaged in insider dealing (or any enquiry or investigation in connection therewith) for the purposes of the SFO in connection with the Placing and the related transactions (including, without limitation, the Share Subscription) entered into or to be entered into pursuant to this Agreement or otherwise; none of the Vendor and the Company and persons acting on their respective behalf or under their respective control has taken or will take, directly or indirectly, any action designed or which was designed, or which constitutes or has constituted or might reasonably be or have been expected to cause or result in, insider dealing, stabilisation or manipulation of the price of any Shares or other securities of the Company; 16