Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for thecontents 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 appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or
subscribe for securities of the Offeror or the Company nor is it a solicitation of any vote or approval in any jurisdiction.

Digital Garage, Inc.

econtext Asia Limited
環亞智富有限公司(incorporated under the laws of Japan)(incorporated in Hong Kong with limited liability)(Stock Code: 1390)

JOINT ANNOUNCEMENTPROPOSAL TO PRIVATISEECONTEXT ASIA LIMITEDBY WAY OF A SCHEME OF ARRANGEMENTUNDER SECTION 673
OF THE COMPANIES ORDINANCEAPPOINTMENT OF THE INDEPENDENT FINANCIAL ADVISER TO
THE INDEPENDENT BOARD COMMITTEEPROPOSED WITHDRAWAL OF LISTING OFECONTEXT ASIA LIMITEDRESUMPTION OF TRADING IN SHARES OFECONTEXT ASIA LIMITED
Financial Adviser to Digital Garage, Inc.

Financial Adviser to econtext Asia Limited

Nomura International (Hong Kong) Limited

Daiwa Capital Markets Hong Kong Limited
Independent Financial Adviser to the
Independent Board Committee

Optima Capital Limited1

THE PROPOSAL
The board of directors of the Offeror and the Board jointly announce that on 23 February 2015,
the Offeror requested the Board to put forward to the Scheme Shareholders the Proposal forthe proposed privatisation of the Company which, if approved, would result in, among otherthings, the withdrawal of listing of the Shares on the Hong Kong Stock Exchange. The Board has
reviewed the Proposal and has agreed to put it forward to the Scheme Shareholders. As at the dateof this announcement, the Offeror is interested in 303,474,998 Shares, representing approximately
58.5% of the issued share capital of the Company.
The Proposal will be implemented by way of a scheme of arrangement under section 673 of theCompanies Ordinance. Upon the Scheme of Arrangement becoming effective, the Scheme Shares
will be cancelled and the New Shares will be issued as fully paid to the Offeror. The Company
will make an application for the listing of the Shares to be withdrawn from the Hong Kong Stock
Exchange in accordance with Rule 6.15 of the Listing Rules, with effect from the date on which
the Scheme of Arrangement becomes effective.
Under the Proposal, the Offeror has proposed that the Scheme Shareholders will receive from theOfferor as Cancellation Consideration HK$4.09 in cash for every Scheme Share cancelled. The
Offeror has advised that the Cancellation Consideration will not be revised in the course of
the Scheme of Arrangement and the Offeror does not reserve the right to do so.
The Cancellation Consideration of HK$4.09 in cash for every Scheme Share cancelled under the
Scheme of Arrangement represents:(i) a premium of approximately 41.0% over the closing price of HK$2.90 per Share as quoted on
the Hong Kong Stock Exchange on the Last Trading Day;(ii) a premium of approximately 59.9% over the average closing price of approximately HK$2.56
per Share as quoted on the Hong Kong Stock Exchange for the 30 trading days up to andincluding the Last Trading Day;(iii) a premium of approximately 60.5% over the average closing price of approximately HK$2.55
per Share as quoted on the Hong Kong Stock Exchange for the 60 trading days up to andincluding the Last Trading Day;(iv) a premium of approximately 51.3% over the average closing price of approximately HK$2.70
per Share as quoted on the Hong Kong Stock Exchange for the 90 trading days up to andincluding the Last Trading Day; and(v) a premium of approximately 43.2% over the average closing price of approximately HK$2.86
per Share as quoted on the Hong Kong Stock Exchange for the 180 trading days up to andincluding the Last Trading Day.

2

The Proposal is conditional upon the fulfilment or waiver, as applicable, of the conditions
described in the section headed “Conditions of the Proposal” of this announcement, which
include, among others, the approval of the Scheme of Arrangement by the Independent
Shareholders at the Court Meeting and the sanction of the Scheme of Arrangement by the High
Court. If the conditions are not fulfilled or, if applicable, not waived on or before 18 August 2015(or such later date as the Offeror and the Company may agree or (to the extent applicable) as
the High Court may direct and as may be permitted under the Takeovers Code), the Scheme of
Arrangement will lapse. The listing of the Shares on the Hong Kong Stock Exchange will not be
withdrawn if the Scheme of Arrangement is withdrawn, not approved or otherwise lapses.
In accordance with Rule 31.1 of the Takeovers Code, except with the consent of the Executive,neither the Offeror nor any person who acted in concert with it in the course of the Proposal, nor
any person who is subsequently acting in concert with any of them, may within 12 months fromthe date on which the Proposal is withdrawn or lapses, either announce an offer or possible offer
for the Company or acquire any voting rights of the Company if the Offeror or persons acting inconcert with it would thereby become obliged under Rule 26 of the Takeovers Code to make anoffer.
The Shares beneficially owned by the Offeror, representing approximately 58.5% of the issued
Shares, will not form part of the Scheme Shares and, as such, will not be voted at the Court
Meeting. The Shares beneficially owned by parties acting in concert with the Offeror in respectof the Company will form part of the Scheme Shares and will be cancelled upon the Scheme of
Arrangement becoming effective in exchange for the payment of the Cancellation Consideration,
but any such concert parties will abstain from voting on the Scheme of Arrangement at the Court
Meeting. All Shareholders are entitled to vote on the special resolution to be proposed at the
GM to approve and give effect to the reduction of capital and the implementation of the Schemeof Arrangement. The Offeror has indicated that if the Scheme of Arrangement is approved at
the Court Meeting, those Shares held by it will be voted in favour the special resolution to be
proposed at the GM.

FINANCIAL RESOURCES
The total cash payment under the Proposal will be approximately HK$880.5 million which will
be funded from a new credit facility made available to the Offeror by Sumitomo Mitsui Banking
Corporation.
Nomura, the financial adviser to the Offeror, is satisfied that sufficient financial resources areavailable to the Offeror to implement the Proposal in accordance with its terms.

IRREVOCABLE UNDERTAKING
As at the date of this announcement, save for an Irrevocable Undertaking given by Mr. Kaoru
Hayashi to the Offeror as further described in the section headed “Irrevocable Undertaking”
below, neither the Offeror nor any party acting in concert with it has received any irrevocablecommitment from Shareholders to vote in favour of the Proposal.

3

SHAREHOLDING STRUCTURE OF THE COMPANY
As at the date of this announcement, the issued share capital of the Company is 518,750,000
Shares.
As at the date of this announcement, the Offeror is interested in 303,474,998 Shares, representing
approximately 58.5% of the issued Shares.
As at the date of this announcement, the Nomura group (other than those members of the Nomura
group that are conducting exempt principal trader activities and exempt fund manager activities),
which is presumed to be acting in concert with the Offeror pursuant to class 5 of the definition of“acting in concert” in the Takeovers Code, does not hold any Shares.
Mr. Kaoru Hayashi, chairman and an executive Director of the Company is interested in
1,000,000 Shares, representing approximately 0.2% of the issued Shares as at the date of thisannouncement. Mr. Kaoru Hayashi is the representative director, president and chief executive
officer of the Offeror and hence is presumed to be acting in concert with the Offeror and is
not entitled to vote at the Court Meeting pursuant to the Takeovers Code. In addition, Mr.
Kaoru Hayashi has irrevocably undertaken to the Offeror to abstain from voting at the Court
Meeting and, to the extent permitted by applicable law and regulation, to vote in favour of theresolutions to be proposed at the GM to approve and give effect to the reduction of capital and theimplementation of the Scheme of Arrangement. Please refer to the section headed “Irrevocable
Undertaking” below for further details.
Save as aforesaid, the Offeror and persons who are parties acting in concert with the Offeror(including Mr. Kaoru Hayashi) do not hold any other Shares or any options, warrants, derivatives
or securities convertible into Shares or other derivatives in respect of securities in the Company.
As at the date of this announcement, the Company does not have any outstanding options,warrants, derivatives or securities convertible into Shares in issue.
Assuming that no new Shares will be issued after the date of this announcement up to the Record
Time, the Offeror will immediately after the Scheme of Arrangement becomes effective beinterested in 518,750,000 Shares, representing all of the Shares then in issue.
As at the date of this announcement, the Independent Shareholders are interested in an aggregateof 214,275,002 Shares, representing approximately 41.3% of the issued Shares, and they will beentitled to vote at the Court Meeting.

4

SCHEME OF ARRANGEMENT
Independent Board Committee
The Independent Board Committee comprising Mr. Toshio Kinoshita, Mr. Takao Nakamura and
Mr. Toshiyuki Fushimi has been formed to advise the Independent Shareholders in connection
with the Proposal. Mr. Joi Okada is a member of the board of directors of the Offeror and has
not been included in the Independent Board Committee so as to avoid a conflict of interest. Mr.
Lindemann was previously employed by the Offeror and shares potential business interests with
the Offeror and has not been included in the Independent Board Committee so as to avoid aconflict of interest.
Appointment of the independent financial adviser to the Independent Board Committee andthe financial adviser to the Company
The Board, with the approval of the Independent Board Committee, has appointed Optima Capital
Limited as the independent financial adviser to advise the Independent Board Committee inconnection with the Proposal and Scheme of Arrangement pursuant to Rule 2.1 of the Takeovers
Code. The Board has appointed Daiwa Capital Markets Hong Kong Limited as the financial
adviser to the Company to advise the Board in connection with the Proposal and Scheme of
Arrangement.
Scheme Document
The Scheme Document including further details of the Proposal, the Scheme of Arrangement, an
explanatory statement, the expected timetable relating to the Proposal, the recommendations of
the Independent Board Committee, the letter of advice from the independent financial adviser,
notices of the Court Meeting and the GM as well as other particulars required by the Takeovers
Code will be despatched to the Shareholders within 21 days from the date of this announcement
or such later date as may be permitted under the Takeovers Code.
If approved, the Scheme of Arrangement will be binding on all Scheme Shareholders, irrespectiveof whether or not they attended or voted at the Court Meeting.

SUSPENSION AND RESUMPTION OF TRADING IN THE SHARESAt the request of the Company, trading in the Shares on the Hong Kong Stock Exchange wassuspended from 9:00 a.m. on 24 February 2015 pending the release of this announcement. An
application has been made by the Company to the Hong Kong Stock Exchange for a resumptionof trading in the Shares with effect from 9:00 a.m. on 27 February 2015.
The Shareholders and/or potential investors should be aware that the implementation of the
Proposal is subject to the conditions set out below being fulfilled or waived, as applicable,
and thus the Proposal may or may not become effective. Accordingly, they are advised toexercise caution when dealing in the Shares.

5

INTRODUCTION
On 23 February 2015, the Offeror requested the Board to put forward to the Scheme Shareholders
the Proposal which, if implemented, will result in the Company becoming wholly-owned by theOfferor. As at the date of this announcement, the Offeror is interested in 303,474,998 Shares,
representing approximately 58.5% of the issued share capital of the Company. The Proposal will be
implemented by way of a scheme of arrangement under section 673 of the Companies Ordinance.
Upon the Scheme of Arrangement becoming effective, the Scheme Shares will be cancelled and the
New Shares will be issued as fully paid to the Offeror.
The Board resolved to put forward the Proposal to the Scheme Shareholders for consideration. The
Company will make an application for the listing of the Shares to be withdrawn from the Hong
Kong Stock Exchange in accordance with Rule 6.15 of the Listing Rules, with effect from the dateon which the Scheme of Arrangement becomes effective.

THE PROPOSAL
Under the Proposal, if the Scheme of Arrangement becomes effective, the Scheme Shareholders will
receive from the Offeror as Cancellation Consideration HK$4.09 in cash for every Scheme Sharecancelled. The Offeror has advised that the Cancellation Consideration will not be revised in
the course of the Scheme of Arrangement and the Offeror does not reserve the right to do so.

COMPARISON OF VALUEThe Cancellation Consideration of HK$4.09 in cash for every Scheme Share cancelled under the
Scheme of Arrangement represents:(i) a premium of approximately 41.0% over the closing price of HK$2.90 per Share as quoted on
the Hong Kong Stock Exchange on the Last Trading Day;(ii) a premium of approximately 59.9% over the average closing price of approximately HK$2.56
per Share as quoted on the Hong Kong Stock Exchange for the 30 trading days up to andincluding the Last Trading Day;(iii) a premium of approximately 60.5% over the average closing price of approximately HK$2.55
per Share as quoted on the Hong Kong Stock Exchange for the 60 trading days up to andincluding the Last Trading Day;(iv) a premium of approximately 51.3% over the average closing price of approximately HK$2.70
per Share as quoted on the Hong Kong Stock Exchange for the 90 trading days up to andincluding the Last Trading Day; and(v) a premium of approximately 43.2% over the average closing price of approximately HK$2.86
per Share as quoted on the Hong Kong Stock Exchange for the 180 trading days up to andincluding the Last Trading Day.

6

TOTAL CONSIDERATION AND CONFIRMATION OF FINANCIALRESOURCESThe total cash payment under the Proposal will be approximately HK$880.5 million which will
be funded from a new credit facility made available to the Offeror by Sumitomo Mitsui Banking
Corporation.
Nomura, the financial adviser to the Offeror, is satisfied that sufficient financial resources areavailable to the Offeror to implement the Proposal in accordance with its terms.

IRREVOCABLE UNDERTAKING
Under the Irrevocable Undertaking given by Mr. Kaoru Hayashi to the Offeror, Mr. Kaoru Hayashi
has irrevocably undertaken to the Offeror in respect of all the Shares owned by him to abstain fromvoting at the Court Meeting and, to the extent permitted by applicable law and regulations, to votein favour of the resolutions to be proposed at the GM to approve and give effect to the reductionof capital and the implementation of the Scheme of Arrangement and in the manner directed by theOfferor in respect of any resolutions proposed at a general or class meeting of the Company (otherthan at the Court Meeting) which would assist the implementation of the Scheme of Arrangement or
are necessary for the Scheme of Arrangement to become effective.
The Irrevocable Undertaking also provides that Mr. Kaoru Hayashi shall not: (i) sell, transfer,charge, encumber, create or grant any option over or otherwise dispose of any interest in any of the
Shares owned by him; (ii) accept or give any undertaking to accept any other offer in respect of allor any of such Shares; (iii) purchase or acquire any other Shares other than with the consent of theOfferor; or (iv) enter into any arrangement which would or might restrict or impede giving effect to
the Scheme of Arrangement.
The Irrevocable Undertaking will lapse if the Offeror announces, with the consent of the Executive
and before the Scheme Document is despatched, that it does not intend to proceed with the Schemeof Arrangement or if the Scheme of Arrangement lapses, is withdrawn in accordance with its terms
or does not become effective by 18 August 2015 (or such later date as the Offeror and the Company
may agree or (to the extent applicable) as the High Court may direct and as may be permitted under
the Takeovers Code).
In addition, Mr. Kaoru Hayashi has undertaken to assist the implementation of the Proposal, subject
to his fiduciary and director’s duties owed to the Company and his duties under the Takeovers
Code.

7

SHAREHOLDING STRUCTURE OF THE COMPANY
As at the date of this announcement, the issued share capital of the Company is 518,750,000 Shares.
The table below sets out the shareholding structure of the Company as at the date of thisannouncement and immediately upon the Scheme of Arrangement becoming effective and assuming
no other new Shares will be issued prior thereto:

Shareholders

The Offeror
Parties acting in concert
with the Offeror:
Mr. Kaoru Hayashi
Aggregate number of Shares heldby parties acting in concert
with the Offeror:
Aggregate number of Shares heldby the Offeror and parties
acting in concert with it
Aggregate number of Shares held
by Independent Shareholders
Total issued share capital

As at the dateof this announcement
Approximate% of theNumber of issued share
SharescapitalUpon the Scheme of
Arrangement becoming
effective
Approximate% of theNumber of issued share
Sharescapital

303,474,998

58.5

518,750,000

100

1,000,000

0.2

0

0

1,000,000

0.2

0

0

304,474,998

58.7

518,750,000

100

214,275,002
518,750,000

41.3
100

0
518,750,000

0100

As at the date of this announcement, the Offeror is interested in 303,474,998 Shares, representing
approximately 58.5% of the issued Shares. The Shares beneficially owned by the Offeror will notform part of the Scheme Shares and, as such, will not be voted at the Court Meeting. The Sharesbeneficially owned by parties acting in concert with the Offeror in respect of the Company will
form part of the Scheme Shares and will be cancelled upon the Scheme of Arrangement becoming
effective in exchange for the payment of the Cancellation Consideration, but any such concert
parties will not be entitled to vote on the Scheme of Arrangement at the Court Meeting pursuant to
the Takeovers Code. All Shareholders are entitled to vote on the special resolution to be proposedat the GM to approve and give effect to the reduction of capital and the implementation of the
Scheme of Arrangement. The Offeror has indicated that, if the Scheme of Arrangement is approvedat the Court Meeting, the Offeror will vote in favour of the special resolution to be proposed at
the GM to approve and give effect to the Scheme of Arrangement, including the approval of the
reduction of the issued share capital of the Company by cancelling and extinguishing the Scheme
Shares and of the issue to the Offeror of such number of New Shares as is equal to the number of
the Scheme Shares cancelled. Parties acting in concert with the Offeror will also be entitled to voteon the special resolution to be proposed at the GM to approve and give effect to the Scheme of
Arrangement.

8

As at the date of this announcement, the Nomura group (other than those members of the Nomura
group that are conducting exempt principal trader activities and exempt fund manager activities),
which is presumed to be acting in concert with the Offeror pursuant to class 5 of the definition of“acting in concert” in the Takeovers Code, does not hold any Shares.
Mr. Kaoru Hayashi, chairman and an executive Director of the Company is interested in 1,000,000
Shares, representing approximately 0.2% of the issued Shares as at the date of this announcement.
Mr. Kaoru Hayashi is the representative director, president and chief executive officer of theOfferor and hence is presumed to be acting in concert with the Offeror and is not entitled to vote at
the Court Meeting pursuant to the Takeovers Code. In addition, Mr. Kaoru Hayashi has irrevocably
undertaken to the Offeror to abstain from voting at the Court Meeting and, to the extent permitted
by applicable law and regulation, to vote in favour of the resolutions to be proposed at the GM
to approve and give effect to the reduction of capital and the implementation of the Scheme of
Arrangement. Please refer to the section headed “Irrevocable Undertaking” below for further
details.
Save as aforesaid, the Offeror and persons who are parties acting in concert with it (including Mr.
Kaoru Hayashi) do not hold any other Shares or any options, warrants, derivatives or securities
convertible into Shares or other derivatives in respect of securities in the Company.
As at the date of this announcement, the Company does not have any outstanding options, warrants,
derivatives or securities convertible into Shares in issue.
As at the date of this announcement, the Independent Shareholders are interested in an aggregateof 214,275,002 Shares, representing approximately 41.3% of the issued Shares, and they will beentitled to vote at the Court Meeting.
As at the date of this announcement, save for the Irrevocable Undertaking, neither the Offeror nor
any party acting in concert with it has received any irrevocable commitment from Shareholders tovote in favour of the Proposal.
Save for the Proposal, the Scheme of Arrangement and the Irrevocable Undertaking, there are no
arrangements (whether by way of option, indemnity or otherwise) relating to relevant securities
which may be an inducement to deal or refrain from dealing as described in Note 8 to Rule 22 of the
Takeovers Code between the Offeror and any other person in relation to shares of the Offeror or the
Shares which might be material to the Proposal and the Scheme of Arrangement.
As at the date of this announcement, neither the Offeror nor any person acting in concert with it
has borrowed or lent any relevant securities of the Company (as defined in Note 4 to Rule 22 of the
Takeovers Code).

9CONDITIONS OF THE PROPOSAL
Under the repealed section 166 of the previous Companies Ordinance (Chapter 32 of the Laws
of Hong Kong), a scheme of arrangement was required to be approved by a majority in numberof the shareholders present and voting in person or by proxy at the court meeting (the so-called“headcount test”). Under the Companies Ordinance, which came into effect on 3 March 2014, theheadcount test does not apply to a scheme of arrangement that involves a takeover offer. Pursuant tosection 674(2) of the Companies Ordinance, for a scheme of arrangement that involves a takeoveroffer to be approved, the votes cast against the scheme of arrangement must not exceed 10% of thevoting rights attached to all Disinterested Shares. This requirement is in addition to the requirement
under the Companies Ordinance that the scheme of arrangement must be approved by shareholders
representing at least 75% of the voting rights of the shareholders present and voting, in person or byproxy, at the court meeting, and to similar voting threshold requirements under the Takeovers Code.
The Proposal will become effective and binding on the Company, the Offeror and all the Scheme
Shareholders subject to the fulfilment or waiver, as applicable, of the following conditions:(a) the approval of the Scheme of Arrangement at the Court Meeting (by way of poll) by Scheme
Shareholders representing at least 75% of the votes attaching to the Scheme Shares held by
Scheme Shareholders that are cast, in person or by proxy, at the Court Meeting, and the numberof votes cast (by way of poll) against the Scheme of Arrangement at the Court Meeting notexceeding 10% of the total voting rights attached to all Disinterested Shares, provided that:(i) the Scheme of Arrangement is approved (by way of poll) by at least 75% of the votes
attaching to the Scheme Shares held by the Independent Shareholders that are cast either inperson or by proxy at the Court Meeting; and(ii) the number of votes cast (by way of poll) against the resolution to approve the Scheme of
Arrangement at the Court Meeting is not more than 10% of the votes attaching to all the
Scheme Shares held by the Independent Shareholders;(b) the passing of a special resolution by a majority of not less than 75% of the votes cast by the
Shareholders present and voting in person or by proxy at the GM (and otherwise in accordancewith the procedural requirements of section 564 of the Companies Ordinance) to approve andgive effect to the Scheme of Arrangement, including the approval of the reduction of the issued
share capital of the Company by cancelling and extinguishing the Scheme Shares and of theissue to the Offeror of such number of New Shares as is equal to the number of the Scheme
Shares cancelled;(c) the sanction of the Scheme of Arrangement (with or without modifications) and theconfirmation of the reduction of the issued share capital of the Company involved in the
Scheme of Arrangement by the High Court and the registration of a copy of the order of theHigh Court by the Registrar of Companies under Part 2 of the Companies Ordinance;(d) the compliance with the procedural requirements of sections 230 and 231 and sections 673 and674 of the Companies Ordinance in relation to the reduction of the issued share capital of theCompany and the Scheme of Arrangement, respectively;
10

(e) all necessary authorisations, consents and approvals (including approval in-principle) of any
governmental or regulatory body in relation to the Proposal (including its implementation)
having been obtained and remaining in full force and effect pursuant to the provisions of any
laws or regulations in Hong Kong, Japan and other relevant jurisdictions;(f) all necessary third party consents in relation to the Proposal required pursuant to any agreement
to which any member of the Group is a party having been obtained or waived by the relevant
party(ies) and remaining in full force and effect without modification;(g) no relevant government, governmental, quasi-governmental, statutory or regulatory body, court
or agency having granted any order or made any decision that would make the Proposal void,
unenforceable or illegal, or restrict or prohibit the implementation of, or impose any additional
material conditions or obligations with respect to, the Proposal;(h) all Authorisations remaining in full force and effect without variation, and all necessary
statutory or regulatory obligations in all relevant jurisdictions having been complied with andno requirement having been imposed by any of the Relevant Authorities which is not expressly
provided for, or is in addition to the requirements expressly provided for, in the relevantlaws, rules, regulations or codes in connection with the Proposal or any matters, documents(including circulars) or things relating thereto, in each case up to and at the time when the
Scheme of Arrangement becomes effective;(i) there being no provision of any agreement, arrangement, licence, permit or other instrument
to which any member of the Group is a party or by or to which any such member or any of its
assets may be bound, entitled or subject, which as a consequence of the Proposal or the Schemeof Arrangement would result in (in each case to an extent which is material in the context of theGroup as a whole and in the context of the Proposal):(i) any monies borrowed by or any other indebtedness (actual or contingent) of any
member of the Group being or becoming repayable (or capable of being declared
repayable) immediately or earlier than their or its stated maturity date or repaymentdate;(ii) any such agreement, arrangement, licence, permit or instrument (or the rights,
liabilities, obligations or interests of any member of the Group thereunder) being
terminated or adversely modified (or any material obligation or liability arising or any
material action being taken thereunder); or(iii) the creation or enforcement of any mortgage, charge or other security interest over thewhole or any part of the business, property or assets of any member of the Group or
any such security (whenever arising) becoming enforceable,
and no event having occurred which, under any provision of any agreement, arrangement,
licence, permit or other instrument to which any member of the Group is a party or by which
any such member or all or any of its assets may be bound, entitled or subject, would resultin any of the events or circumstances as are referred to in sub-paragraphs (i) to (iii) of thisparagraph (i) (in each case to an extent which is material in the context of the Group as a wholeand in the context of the Proposal);
11

(j) no event having occurred which would make the Proposal, the cancellation of the Scheme
Shares or the issue of the New Shares void, unenforceable or illegal or which would prohibit theimplementation of the Proposal or impose any additional material conditions or obligations withrespect to the Proposal or any part thereof, on the cancellation of the Scheme Shares or the issueof the New Shares; and(k) since the date of this announcement:(i) there having been no adverse change in the business, assets, financial or trading, positions,profits or prospects of any member of the Group (to an extent which is material in thecontext of the Group taken as a whole or in the context of the Proposal); and(ii) there not having been instituted or remaining outstanding any litigation, arbitration,
proceedings, prosecution or other legal proceedings to which any member of the Group isa party (whether as plaintiff, defendant or otherwise) and no such proceedings having been
threatened in writing against any such member (and no investigation by any governmentor quasi-governmental, supranational, regulatory or investigative body or court against
or in respect of any such member or the business carried on by any such member having
been threatened in writing, announced, instituted or remaining outstanding by, against or in
respect of any such member), in each case which is material and adverse in the context of
the Group taken as a whole or in the context of the Proposal.
The Offeror reserves the right to waive all or any of the conditions (except for the conditions
referred to in paragraphs (a) to (e), (g) and (j) above) in whole or in part. The Company does nothave the right to waive any of the conditions. All of the above conditions will have to be fulfilled
or waived, as applicable, on or before 18 August 2015 (or such later date as the Offeror and theCompany may agree or (to the extent applicable) as the High Court may direct and as may bepermitted under the Takeovers Code), otherwise the Scheme of Arrangement will lapse. If the
Scheme of Arrangement is withdrawn, not approved or lapses, the listing of the Shares on the
Hong Kong Stock Exchange will not be withdrawn. In accordance with Note 2 to Rule 30.1 of
the Takeovers Code, the Offeror will not be permitted to invoke all or any of the conditions of the
Proposal so as to cause the Scheme of Arrangement to lapse unless the circumstances which giverise to the right to invoke the condition are of material significance to the Offeror in the context of
the Proposal.
As of the date of this announcement, there are no agreements or arrangements to which the Offeror
is a party which relate to the circumstances in which it may or may not invoke or seek to invoke a
condition to the Proposal.
In accordance with Rule 31.1 of the Takeovers Code, except with the consent of the Executive,neither the Offeror nor any person who acted in concert with it in the course of the Proposal, nor
any person who is subsequently acting on concert with any of them, may within 12 months from thedate on which the Proposal is withdrawn or lapses, either announce an offer or possible offer for theCompany or acquire any voting rights of the Company if the Offeror or persons acting in concert
with it would thereby become obliged under Rule 26 of the Takeovers Code to make an offer.
If approved, the Scheme of Arrangement will be binding on all Scheme Shareholders, irrespectiveof whether or not they attended or voted at the Court Meeting.
12

REASONS FOR AND BENEFITS OF THE PROPOSAL
The e-commerce market in Asia has achieved more rapid growth than the Offeror had anticipatedat the time of the Company’s public listing. The Offeror believes that the price of companies inpayment related businesses has risen significantly due to the strong investment appetite of global
investors. As a result, the Company will require substantially more funding than it previously
expected in order to facilitate its ongoing acquisition strategy. While the Company is currently
exploring opportunities to invest in certain companies as part of its ongoing expansion, the Offeror
believes that the current valuations of these companies make it difficult for the Company to executeacquisitions on its own.
While the Company’s core online payment services businesses have grown substantially sincelisting on the Hong Kong Stock Exchange, the Offeror believes that the division of resources
between the Offeror and the Company has led to the performance of the Company, as measured by
key financial metrics such as revenue, growth rate and stock price, to be deficient as compared to
the Company’s competitors in Japan. In addition, the exchange rate between Hong Kong dollars andJapanese yen has decreased by approximately 14% since the listing of the Company due to the yen’s
rapid depreciation. This has also affected the price of the Shares as the Company’s core businessis derived from its operations in Japan. As a result of the decrease in the price of the Shares,
the Company is also facing increasing difficulties in conducting acquisitions using the Shares as
consideration.
The Offeror believes that the Company will require substantial funding for its future development.
Without being subject to the requirements relevant to being run as a standalone listed company, theCompany will be able to fund future acquisitions and investments through leveraging the Offeror’s
greater financial strength, including the latter’s access to more competitive financing terms toraising bank borrowings. Additionally, upon becoming an unlisted wholly-owned subsidiary of theOfferor, the provision of intra-group funding from the Offeror to the Company will be facilitated.
Due to the low liquidity of the Shares and the significant discount to the net asset value per Shareof its trading price on the Hong Kong Stock Exchange, the public equity capital market does notprovide the Company with a viable funding alternative.
The Proposal will facilitate business integration between the Offeror and the Company and will
provide the Offeror with greater flexibility to support the future business of the Company. Since
the Offeror already beneficially owns approximately 58.5% of the Shares as at the date of thisannouncement, the directors of the Offeror believe that it is unlikely that the Scheme Shareholders
will receive any offer from a third party to acquire the Scheme Shares, as such offer would
not succeed without the approval of the Offeror. In addition, Shareholders should note that no
discussions have taken place (or are taking place) with any third party regarding the disposal of anyof the Shares held by the Offeror.

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The Offeror accordingly considers that the Scheme of Arrangement provides an opportunity for the
Scheme Shareholders to dispose of their Shares and receive cash at a price significantly above thehistorical market price prior to this announcement. In light of the low liquidity of the Shares, it isdifficult for the holders of the Scheme Shares to realise their Scheme Shares in the stock market
without adversely affecting the market price of the Shares. The Offeror considers that the Scheme of
Arrangement also affords the Scheme Shareholders with the opportunity to realise their investmentsin the Company as referred to above, and if they so wish, invest the monies received under the
Scheme of Arrangement in alternative investments with higher liquidity than the Shares or use themfor other purposes.

INFORMATION ON THE OFFERORThe Offeror was established in 1995 and its shares are listed and traded on the JASDAQ marketof the Tokyo Stock Exchange. The Offeror is principally engaged in the internet business inJapan with three business segments: (i) incubation, which focuses on the promotion of investment
opportunities in information technology related venture businesses, (ii) marketing, which focuses on
the provision of online marketing tools for advertising and sales promotions targeted at customers,and (iii) payment, which focuses on the provision of online payment and e-commerce solutions. As
part of the reorganisation of the Company prior to the listing of the Shares on the Hong Kong Stock
Exchange, all of the business of the Offeror’s payment segment was transferred to the Company.

INFORMATION ON THE COMPANY
The Company was established in 2012 as the holding company and regional headquarters for
its operating subsidiaries in Japan in order to further expand its business throughout Asia, andits Shares are listed and traded on the Hong Kong Stock Exchange. The Company is principally
engaged in the business of providing online payment services, advertising related services andother e-commerce solutions. The Company acts as an intermediary between online merchants andfinancial institutions or convenience store chains to facilitate the processing of transaction data andsettlement of transactions. The Company’s principal business operations are in Japan.

FUTURE PLANS FOR THE COMPANYThe Offeror intends to continue the existing business of the Company upon successful
implementation of the Scheme of Arrangement and the Proposal. The Offeror has no intention to
make any major changes to the existing operations and business, or to discontinue the employmentof the employees of the Group after implementation of the Scheme of Arrangement and the
Proposal. However, the Offeror will continue to assess business opportunities as they arise.

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If the Scheme of Arrangement and Proposal are successfully implemented, the Offeror intends toimplement the following steps as part of the Offeror and the Company’s ongoing growth strategy.
(1) Create a comprehensive service package and to capitalize on the synergies between theOfferor Group and the Company
The Company’s core businesses is focused on serving the entire electronic payments market,
which includes the e-commerce market. In particular, the Company is actively developing
its business in areas that require face-to-face payment, such as restaurants and the real estateleasing businesses. The Offeror believes that the Company can capitalize on the Offeror’s
existing client base and the Company can offer its electronic payment services to complement
the Offeror’s marketing services. The Offeror believes that offering a service package that
includes marketing services will help attract customers to its electronic payment businesses.
Also, as part of the Offeror’s incubation segment, the Offeror actively invests in and supports
the development of companies that operate in the IT services sector. The Offeror intends tocreate synergies for its incubation segment by leveraging its marketing and payment solutions.
The Offeror believes that this will maximize the value of both the Company and the Offeror
Group as a whole.
(2) Strengthen the Company and the Offeror’s ability to raise capital and acquisition strategy
in Asia
As the recent prices for potential acquisition targets have increased recently, the Offeror
believes that it should develop an acquisition strategy for the Offeror Group as a whole rather
than for the Company on a stand-alone basis. By doing so, the Company would be able toutilize the Offeror Group’s financial strength and business credibility to negotiate favorable
terms when raising the necessary funding for such acquisitions. With additional financial
resources as a consolidated group, the Offeror Group will also be able to make acquisitions ofa larger scale. The Offeror believes that this would help accelerate the growth of the Company
and the Offeror Group as a whole.
(3) Streamlining management resources through organizational restructuring with theOfferor GroupThe Offeror believes that the e-commerce and electronic payments market will continue togrow and the number of competitors will continue to increase. In order to remain competitive,
the Offeror believes that the streamlining of management resources is essential as part of its
growth strategy. The Offeror intends to combine the marketing related business segments inorder to consolidate management resources, as well as managing the Company’s investments
through the Offeror’s incubation business.

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WITHDRAWAL OF LISTING OF THE SHARES
Upon the Scheme of Arrangement becoming effective, all Scheme Shares will be cancelled andthe share certificates for the Scheme Shares will thereafter cease to have effect as documents
or evidence of title. The Company will make an application for the listing of the Shares to bewithdrawn from the Hong Kong Stock Exchange in accordance with Rule 6.15 of the Listing Rules,
with effect from the date on which the Scheme of Arrangement becomes effective. Subject to therequirements of the Takeovers Code, the Scheme of Arrangement will lapse if any of the conditions
described in the section headed “Conditions of the Proposal” has not been fulfilled or waived,
as applicable, on or before 18 August 2015 (or such later date as the Offeror and the Company
may agree or, to the extent applicable, as the Court may direct and as may be permitted under the
Takeovers Code). The Scheme Shareholders will be notified by way of an announcement of thedates of the last day for dealing in the Shares and on which the Scheme of Arrangement and thewithdrawal of the listing of the Shares on the Hong Kong Stock Exchange will become effective.
A detailed timetable of the Scheme of Arrangement will be included in the Scheme Document. The
Scheme Document will also contain, among other things, further details of the Proposal and the
Scheme of Arrangement.
If the Scheme of Arrangement is withdrawn or not approved or lapses, the listing of the Shares on
the Hong Kong Stock Exchange will not be withdrawn.

OVERSEAS SHAREHOLDERS
The making of the Proposal to those Scheme Shareholders who are not resident in Hong Kong
may be subject to the laws of the relevant jurisdictions where such Scheme Shareholders arelocated. Such Scheme Shareholders should inform themselves about and observe any applicablelegal and regulatory requirements of their own jurisdictions. It is the responsibility of any overseas
Scheme Shareholders wishing to accept the Proposal to satisfy themselves as to the full observanceof the laws of the relevant jurisdiction in connection therewith, including the obtaining of any
governmental or exchange control or other consents which may be required, or the compliancewith other necessary formalities and the payment of any issue, transfer or other taxes due in suchjurisdiction.
In the event that the receipt of the Scheme Document by overseas Scheme Shareholders is
prohibited by any relevant law or regulation or may only be effected after compliance withconditions or requirements that the directors of the Offeror regard as unduly onerous or burdensome(or otherwise not in the best interests of the Offeror or the shareholders of the Offeror), the Scheme
Document will not be despatched to such overseas Scheme Shareholders. For that purpose, theOfferor will apply for any waivers as may be required by the Executive pursuant to Note 3 to Rule
8 of the Takeovers Code at such time. Any such waiver will only be granted if the Executive issatisfied that it would be unduly burdensome to despatch the Scheme Document to such overseas
Scheme Shareholders. In granting the waiver, the Executive will be concerned to see that allmaterial information in the Scheme Document is made available to such Scheme Shareholders.

16

If any such waiver is granted by the Executive, the Offeror reserves the right to make arrangements
in respect of Scheme Shareholders who are not resident in Hong Kong in relation to the termsof the Proposal. Such arrangements may include notifying any matter in connection with the
Proposal to the Scheme Shareholders having a registered overseas address by announcement or byadvertisement in a newspaper which may or may not be circulated in the jurisdiction within whichsuch persons are resident. The notice will be deemed to have been sufficiently given, despite any
failure by such Scheme Shareholders to receive or see that notice.
Scheme Shareholders are recommended to consult their own professional advisers if they are inany doubt as to the taxation implications of accepting the Proposal. It is emphasised that none of
the Company, the Offeror, Nomura or any of their respective directors, officers or associates or any
other person involved in the Proposal accepts responsibility for any taxation effects on, or liabilitiesof, any persons as a result of their acceptance or rejection of the Proposal.

SCHEME OF ARRANGEMENT
Independent Board Committee
The Independent Board Committee comprising Mr. Toshio Kinoshita, Mr. Takao Nakamura and
Mr. Toshiyuki Fushimi has been formed to advise the Independent Shareholders in connection with
the Proposal. Mr. Joi Okada is a member of the board of directors of the Offeror and has not been
included in the Independent Board Committee so as to avoid a conflict of interest. Mr. Lindemannwas previously employed by the Offeror and shares potential business interests with the Offeror andhas not been included in the Independent Board Committee so as to avoid a conflict of interest.
Appointment of the independent financial adviser to the Independent Board Committee andthe financial adviser to the Company
The Board, with the approval of the Independent Board Committee, has appointed Optima Capital
Limited as the independent financial adviser to advise the Independent Board Committee inconnection with the Proposal and Scheme of Arrangement pursuant to Rule 2.1 of the Takeovers
Code. The Board has appointed Daiwa Capital Markets Hong Kong Limited as the financial adviser
to the Company to advise the Board in connection with the Proposal and Scheme of Arrangement.
Scheme Document
A Scheme Document including, among other things, further details of the Proposal and the Schemeof Arrangement, an explanatory statement, the expected timetable relating to the Proposal, therecommendations of the Independent Board Committee, the letter of advice from the independent
financial adviser, notices of the Court Meeting and the GM as well as other particulars required by
the Takeovers Code will be despatched to the Shareholders within 21 days from the date of thisannouncement or such later date as may be permitted under the Takeovers Code.

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SUSPENSION AND RESUMPTION OF TRADING IN THE SHARESAt the request of the Company, trading in the Shares on the Hong Kong Stock Exchange wassuspended from 9:00 a.m. on 24 February 2015 pending the release of this announcement. An
application has been made by the Company to the Hong Kong Stock Exchange for a resumption of
trading in the Shares with effect from 9:00 a.m. on 27 February 2015.

DISCLOSURE OF DEALINGS
Associates of the Company and the Offeror (including persons holding 5% or more of any class of
relevant securities of the Company or the Offeror) are reminded to disclose their dealings in any
securities in the Company.
In accordance with Rule 3.8 of the Takeovers Code, reproduced below is the full text of Note 11 toRule 22 of the Takeovers Code:“Responsibilities of stockbrokers, banks and other intermediaries
Stockbrokers, banks and others who deal in relevant securities on behalf of clients have a general
duty to ensure, so far as they are able, that those clients are aware of the disclosure obligations
attaching to associates and other persons under Rule 22 and that those clients are willing to comply
with them. Principal traders and dealers who deal directly with investors should, in appropriate
cases, likewise draw attention to the relevant Rules. However, this does not apply when the total
value of dealings (excluding stamp duty and commission) in any relevant security undertaken for aclient during any 7 day period is less than HK$1 million.
This dispensation does not alter the obligation of principals, associates and other persons
themselves to initiate disclosure of their own dealings, whatever total value is involved.
Intermediaries are expected to co-operate with the Executive in its dealings enquiries. Therefore,
those who deal in relevant securities should appreciate that stockbrokers and other intermediaries
will supply the Executive with relevant information as to those dealings, including identities ofclients, as part of that co-operation.”

WARNING
Shareholders and/or potential investors should be aware that the implementation of the
Proposal is subject to the conditions set out above being fulfilled or waived, as applicable, andthus the Proposal may or may not become effective. Accordingly, they are advised to exercise
caution when dealing in the Shares.

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DEFINITIONSIn this announcement, the following expressions have the meanings set out below unless the context
requires otherwise.
“acting in concert”

has the meaning given to it in the Takeovers Code, and “parties acting
in concert” and “concert parties” shall be construed accordingly“Associate(s)”has the meaning given to it in the Takeovers Code“Authorisations”

all necessary authorisations, registrations, filings, rulings, consents,
permissions, waivers, exemptions and approvals required from theRelevant Authorities or other third parties which are necessary for any
member of the Group to carry on its business“Board”

the board of the directors of the Company“Cancellation
Consideration”

the consideration of HK$4.09 in cash for every Scheme Sharecancelled“Companies
Ordinance”

Companies Ordinance, Chapter 622 of the Laws of Hong Kong

“Company”

econtext Asia Limited, a company incorporated in Hong Kong withlimited liability whose Shares are listed on the Hong Kong Stock
Exchange (stock code: 1390)“Court Meeting”

a meeting of the Scheme Shareholders to be convened at the directionof the High Court for the purpose of approving the Scheme of
Arrangement“Director(s)”director(s) of the Company“Disinterested Shares”

Shares in issue other than those held by: (i) the Offeror or by anominee on its behalf; (ii) an associate (as defined in section 667(1)(b) of the Companies Ordinance) of the Offeror, except a person who
falls within section 667(1)(b)(iii) of the Companies Ordinance or aperson specified in section 674(4) of the Companies Ordinance; or (iii)a person who is a party to an acquisition agreement within the meaningof section 667(5) of the Companies Ordinance with the Offeror (except
a person specified in section 674(4) of the Companies Ordinance), orby a nominee on behalf of the person under the acquisition agreement,
as described in section 674(3)(a) of the Companies Ordinance“Executive”

the Executive Director of the Corporate Finance Division of the SFC
or any delegate of the Executive Director

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“GM”

a general meeting of the Company to be held after the Court Meetingfor the purpose of approving the reduction of the share capital of theCompany and implementing the Scheme of Arrangement“Group”

the Company and its subsidiaries from time to time“High Court”

the High Court of Hong Kong

“HK$”

Hong Kong dollar(s), the lawful currency of Hong Kong

“Hong Kong”

Hong Kong Special Administrative Region of the People’s Republic of
China“Hong Kong
Stock Exchange”

The Stock Exchange of Hong Kong Limited“Independent Board
Committee”

the independent committee of the Board formed to advise theIndependent Shareholders in connection with the Proposal andcomprising Mr. Toshio Kinoshita, Mr. Takao Nakamura and Mr.
Toshiyuki Fushimi“Independent
Shareholders”

Shareholders other than the Offeror and parties acting in concert withit

“Irrevocable
Undertaking”

the irrevocable undertaking given by Mr. Kaoru Hayashi as describedin the section of this announcement headed “Irrevocable Undertaking”“JASDAQ”

the Japan Association of Securities Dealers Automated Quotation“Last Trading Day”

23 February 2015, being the last full trading day in the Shares on the
Hong Kong Stock Exchange immediately before the suspension of
trading in the Shares pending publication of this announcement“Listing Rules”

the Rules Governing the Listing of Securities on The Stock Exchange
of Hong Kong Limited“New Shares”

new Shares to be issued to the Offeror pursuant to the Scheme of
Arrangement, and being the same in number as the number of the
Scheme Shares“Nomura”

Nomura International (Hong Kong) Limited, the financial adviser to
the Offeror. Nomura is a licensed corporation under the SFO, licensed
to carry out Type 1 (dealing in securities), Type 2 (dealing in futurescontracts), Type 4 (advising on securities), Type 5 (advising on
futures contracts) and Type 6 (advising on corporate finance) regulated
activities
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“Offeror”

Digital Garage, Inc., a company incorporated under the laws of Japan
whose shares are listed on the JASDAQ market of the Tokyo Stock
Exchange“Offeror Group”

Digital Garage, Inc. and its subsidiaries“Proposal”

the proposed privatisation of the Company by the Offeror by way of
the Scheme of Arrangement“Record Time”

the appropriate record time to be announced for determining
entitlements under the Scheme of Arrangement“Registrar ofCompanies”

the Registrar of Companies appointed under the Companies Ordinance“RelevantAuthorities”

applicable governments or governmental bodies, regulatory bodies,
courts or institutions including but not limited to the SFC and the Hong
Kong Stock Exchange“Scheme Document”

the composite scheme document of the Offeror and the Company,
containing, inter alia, further details of the Proposal and the Scheme of
Arrangement together with the additional information specified in thesection of this announcement headed “Scheme Document”“Scheme of
Arrangement”

the scheme of arrangement under section 673 of the Companies
Ordinance for the implementation of the Proposal“SchemeShareholders”

registered holders of the Scheme Shares“Scheme Shares”

Shares in issue at the Record Time, including any Shares which may
be issued by the Company following the date of this announcement,
other than those beneficially owned by the Offeror“SFC”

Securities and Futures Commission“SFO”

Securities and Futures Ordinance, Chapter 571 of the Laws of Hong
Kong

“Shareholders”

registered holders of the Shares“Shares”

ordinary shares in the capital of the Company

21

“Takeovers Code”

Hong Kong Code on Takeovers and Mergers (as revised from time totime)“TokyoStock Exchange”

Tokyo Stock Exchange, Inc.

By Order of the board of directors of

By order of the Board

Digital Garage, Inc.
Mr. Yasuyuki Rokuyata
Director and Chief Operations Officer

econtext Asia Limited
Mr. Takashi Okita
Executive Director and Chief Executive Officer

Hong Kong, 26 February 2015
As at the date of this announcement, the board of directors of the Offeror comprises Mr. Kaoru Hayashi, as representative
director; Mr. Yasuyuki Rokuyata, Mr. Naohiko Iwai, Mr. Makoto Soda, Mr. Keizo Odori, Mr. Masashi Tanaka and Mr. Joi Okada
as directors; and Mr. Joichi Ito, Mr. Kenji Fujiwara and Mr. Emi Omura as outside directors.
The directors of the Offeror jointly and severally accept full responsibility for the accuracy of the information contained in thisannouncement, other than that relating to the Company, and confirm, having made all reasonable inquiries, that to the best of
their knowledge, opinions expressed in this announcement, other than those expressed by the Company, have been arrived at after
due and careful consideration and there are no facts not contained in this announcement, the omission of which would make any
statement in this announcement misleading.
As at the date of this announcement, the Board comprises Mr. Kaoru Hayashi (Chairman), Mr. Takashi Okita, Mr. Tomohiro
Yamaguchi and Mr. Keizo Odori as executive Directors; Mr. Joi Okada, Mr. Adam Lindemann as non-executive Directors; andMr. Toshio Kinoshita, Mr. Takao Nakamura and Mr. Toshiyuki Fushimi as independent non-executive Directors.
The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement
relating to the Company, and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions
expressed in this announcement by the Company, have been arrived at after due and careful consideration and there are no facts
not contained in this announcement, the omission of which would make any statement in this announcement misleading.

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