M Dream Inworld Limited 聯夢活力世界有限公司

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser. If you have sold or transferred all your shares in M Dream Inworld Limited (‘‘Company’’), you should at once hand this circular and the accompanying form of proxy to the purchaser, the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. This circular is for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for the shares or other securities of the Company. Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular. M DREAM INWORLD LIMITED 聯夢活力世界有限公司 * (Incorporated in the Cayman Islands with limited liability) (Stock Code: 8100) VERY SUBSTANTIAL ACQUISITION; CONTINUING CONNECTED TRANSACTIONS; PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL; AND NOTICE OF EXTRAORDINARY GENERAL MEETING Financial adviser to the Company A notice convening the extraordinary general meeting of the Company to be held at 10:30 a.m. on 12 March 2013 at 3/F, Nexxus Building, 77 Des Voeux Road Central, Hong Kong is set out on pages 157 to 159 of this circular. Whether or not you are able to attend the meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof to the office of the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong. Completion and return of the form of proxy will not preclude you from attending and voting at the meeting in person should you so wish. This circular will remain on the ‘‘Latest Company Announcements’’ page of the GEM website at http://www.hkgem.com for at least seven (7) days from the date of publication and on the website of the Company at http://www.mdreaminworld.com.hk. * For identification purpose only 23 February 2013 CONTENTS Page Characteristics of GEM .................................... ii Definitions ............................................ 1 Letter from the Board ..................................... 8 Industry overview ........................................ 46 Regulatory overview ...................................... 49 Risk factors ........................................... 54 Appendix I — Financial information on the Group ................. 61 Appendix II — Financial information on the Apperience Group .......... 79 Appendix III — Unaudited pro forma financial information of the Enlarged Group .......................... 112 Appendix IV — Valuation report of Apperience .................... 125 Appendix V — General information ........................... 143 Notice of the EGM ....................................... 157 – i – CHARACTERISTICS OF GEM GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors. Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM. – ii – DEFINITIONS In this circular, unless the context otherwise requires, the following expressions have the following meanings: ‘‘2013 IT Consultancy the IT consultancy service agreement entered into between Service Agreement’’ Apperience as service recipient and the PRC Company as service provider dated 31 December 2012 in relation to the provision of technological consultancy services ‘‘Access Magic’’ Access Magic Limited, a company incorporated in the BVI which is principally engaged in investment holding and beneficially 100% owned by Dong Yuguo, being one of the Warrantors and Key Employees ‘‘Ace Source’’ Ace Source International Limited, a company incorporated in the BVI which is principally engaged in investment holding and beneficially 100% owned by Xue Qiushi, being one of the Warrantors and Key Employees ‘‘Acquisition’’ the proposed acquisition of the Sale Shares by the Company as purchaser from the Vendors pursuant to the Acquisition Agreement ‘‘Acquisition Agreement’’ the conditional sale and purchase agreement dated 15 November 2012 entered into by and among the Company, the Vendors and the Warrantors in relation to the Acquisition (as supplemented and amended by the Supplemental Agreement) ‘‘Apperience’’ Apperience Corporation, an exempted company incorporated in the Cayman Islands ‘‘Apperience Group’’ Apperience and its subsidiaries ‘‘associate(s)’’ hasthemeaningascribedtoitintheGEMListingRules ‘‘Board’’ the board of Directors ‘‘Business Valuation’’ the business valuation showing the estimated fair value of Apperience as at 30 September 2012 ‘‘BVI’’ the British Virgin Islands ‘‘Company’’ M Dream Inworld Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the GEM ‘‘Completion’’ completion of the Acquisition ‘‘Completion Date’’ the date on which Completion is to take place – 1 – DEFINITIONS ‘‘connected person(s)’’ hasthemeaningascribedtoitintheGEMListingRules ‘‘Consideration’’ the total consideration payable by the Company to the Vendors for the purchase of the Sale Shares pursuant to the Acquisition Agreement, which would be satisfied partly by the creation and issue of the Convertible Notes and (where applicable) partly by the allotment and issue of the Performance Shares ‘‘Conversion Price’’ HK$0.108, being the conversion price for the subscription of one Conversion Share upon the exercise of the Conversion Rights attaching to the Convertible Notes, subject to adjustments under the terms and conditions of the Convertible Notes ‘‘Conversion Right(s)’’ the right(s) of the Noteholder to convert the whole or part of the outstanding principal amount of the Convertible Notes into Conversion Shares subject to the terms and conditions of the Convertible Notes ‘‘Conversion Share(s)’’ the new Share(s) to be allotted and issued to the Noteholder(s) upon the exercise of the Conversion Rights attaching to the Convertible Notes ‘‘Convertible Notes’’ the zero coupon convertible notes in the principal amount of up to HK$392,132,500 (subject to adjustment) due on, subject to the conditions attached to the Convertible Notes, the Maturity Date ‘‘Copyright Licence Agreement’’ the copyright licence agreement dated 18 February 2013 entered into between Apperience as licensee and the PRC Company as licensor in relation to the granting of licence to use the copyright of ‘‘Advanced SystemCare’’ registered in the name of the PRC Company in the PRC ‘‘Director(s)’’ the director(s) of the Company ‘‘EGM’’ the extraordinary general meeting of the Company to be held at 10:30 a.m. on 12 March 2013 for the purpose of considering and, if thought fit, approving the Acquisition and the transactions contemplated under the Acquisition Agreement (including the creation and issue of the Convertible Notes, the allotment and issue of the Conversion Shares and the allotment and issue of the Performance Shares) and the proposed increase in authorised share capital of the Company – 2 – DEFINITIONS ‘‘Enlarged Group’’ the group of companies consisting of the Company and its subsidiaries after Completion (including, for the avoidance of doubt, members of the Apperience Group) ‘‘GEM’’ the Growth Enterprise Market of the Stock Exchange ‘‘GEM Listing Rules’’ the Rules Governing the Listing of Securities on GEM ‘‘Group’’ the Company and its subsidiaries ‘‘HIBOR’’ Hong Kong Interbank Offered Rate ‘‘HK$’’ Hong Kong dollars, the lawful currency of Hong Kong ‘‘Hong Kong’’ Hong Kong Special Administrative Region of the PRC ‘‘IDG-Accel’’ IDG-Accel China Growth Fund II L.P., an investment fund established in the Cayman Islands as an exempted limited partnership ‘‘IDG-Accel Investors’’ IDG-Accel China Investors II L.P., an investment fund established in the Cayman Islands as an exempted limited partnership ‘‘IDG-Accel Vendors’’ IDG-Accel and IDG-Accel Investors ‘‘Independent Third Party(ies)’’ third party(ies) independent of the Company and its connected persons ‘‘IP Licence Agreement’’ the intellectual property rights licence agreement dated 15 April 2011 entered into between Apperience as licensee and the PRC Company as licensor in relation to the granting of licence to use certain intellectual property rights of the PRC Company ‘‘IP Transfer Agreement’’ the intellectual property rights

Load more