Pacific Online : 2019-02-19 VOLUNTARY ANNOUNCEMENT — THE FURTHER AMENDED AND RESTATED STRUCTURE CONTRACTS

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PACIFIC ONLINE LIMITED 太 平 洋 網絡 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 543)

VOLUNTARY ANNOUNCEMENT -

THE FURTHER AMENDED AND RESTATED STRUCTURE CONTRACTS

On 14 February 2019, Zhang Cong Min, being one of the Existing GZ Yingxin Shareholders, the Existing GZ Yingyue Shareholders and the Existing GZ Yingyou Shareholders, entered into the Equity Transfer Agreements with certain New PRC Opcos Shareholders, pursuant to which Zhang Cong Min agreed to transfer all of her respective equity interests in GZ Yingxin, GZ Yingyue and GZ Yingyou.

THE FURTHER AMENDED AND RESTATED STRUCTURE CONTRACTS

Due to the transfers contemplated under the Equity Transfer Agreement, on 15 February 2019, certain Domestic Entities, Zhang Cong Min, and the New PRC Opcos Shareholders entered into the Termination Agreements, pursuant to which the parties thereto agreed that the Amended and Restated PConline Structure Contracts, the Amended and Restated PClady Structure Contracts and the Existing PChouse Structure Contracts shall lapse automatically and the relevant parties shall enter into the Further Amended and Restated Structure Contracts.

On the same day and immediately after the execution of the Termination Agreements, the Further Amended and Restated Structure Contracts were entered into among the relevant Domestic Entities and the New PRC Opcos Shareholders. Pursuant to the Further Amended and Restated Structure Contracts, the Company will operate its online business relating to the portals of PConline, PCauto, PCbady, PClady and PChouse through the Domestic Entities.

As a result of the Further Amended and Restated Structure Contracts, the Group can continue to recognize and receive the economic benefits of the businesses and operations of the Domestic Entities. The Further Amended and Restated Structure Contracts are also designed to provide the Company with effective control over and (to the extent permitted by PRC law) the right to acquire the equity interests in Target Companies (as defined below).

LISTING RULES IMPLICATIONS

In preparation for the Listing, the Company has sought, and the Stock Exchange has granted, the waiver (the ''Waiver'') from strict compliance with the applicable reporting, announcement and independent shareholders' approval requirements relating to the annual caps, three years term and fee terms of Chapter 14A of the Listing Rules in connection with the continuing connected transactions involving the Group in the form of the Existing PConline Structure Contracts subject to the Conditions (the ''Conditions''). The Conditions include, among others, that on the basis that the Existing PConline Structure Contracts provide an acceptable framework for the relationship between the Company and its subsidiaries on the one hand, and GZ Yingxin and GDP Internet, on the other hand, that framework may be renewed and/or cloned upon the expiry of the existing arrangements or in relation to any existing or new wholly foreign-owned enterprise or operating company that the Group may wish to establish, without obtaining the approval of the Shareholders.

The Directors are of the view that pursuant to the Conditions and on the basis that the Further Amended and Restated Structure Contracts, though entered into among different parties and with terms in compliance with the more updated and stringent requirements set out in the listing decision handed down by the Stock Exchange subsequent to the Existing PConline Structure Contracts, which are more beneficial to the Shareholders as a whole, have terms and conditions substantially the same as those of the Existing PConline Structure Contracts, they are merely clones of the Existing PConline Structure Contracts. As such, the Directors are of the view that the contractual arrangements underlying the Further Amended and Restated Structure Contracts are in compliance with the Conditions under which the Waiver was granted.

As such, the Company has sought, and the Stock Exchange has provided confirmation that:

(i) the Further Amended and Restated Structure Contracts will be exempt from the reporting, announcement and independent shareholders' approval requirements under Chapter 14A of the Listing Rules; and

(ii) the transactions between the Group and each of GZ Yingxin, GDP Internet, GZ

Yingyue, GZS Internet, GZ Yingyou and GZ Shangcong Online relating to the Further Amended and Restated Structure Contracts will be exempt from the continuing connected transaction requirements under Chapter 14A of the Listing Rules.

BACKGROUND

References are made to the Prospectus and the announcements (the ''Announcements'') of the Company dated 2 July 2015,7 August 2018 and 16 October 2018. As disclosed in the section headed ''Structure Contracts'' in the Prospectus and in the Announcements, due to the limitation of applicable PRC laws and regulations on foreign ownership of companies that provide internet content services, the Group conducts its internet multi-portals and online advertising business in the PRC through GDP Internet, GZS Internet and GZ Shangcong Online, the operating ICP companies, pursuant to the contractual arrangements underlying the Amended and Restated PConline Structure Contracts, the Amended and Restated PClady Structure Contracts and the Existing PChouse Structure Contracts.

The corporate structure of the Group under the structure contracts arrangements before the Transfers (as defined below) is set out in Schedule A of this announcement.

THE EQUITY TRANSFER AGREEMENTS AND THE REASONS FOR ENTERING INTO THE FURTHER AMENDED AND RESTATED STRUCTURE CONTRACTS

On 14 February 2019, Zhang Cong Min, who is one of the Existing GZ Yingxin Shareholders, Existing GZ Yingyue Shareholders and Existing GZ Yingyou Shareholders, entered into the Equity Transfer Agreements to transfer her equity interests in each of GZ Yingxin, GZ Yingyue and GZ Yingyou to other employees of the Group (the ''Transfers''). The table below shows the details of the Transfers.

Shareholders of GZ	Shareholders of GZ	Shareholders of GZ
Yingxin and their	Yingyue and their	Yingyou and their
respective shareholding	respective shareholding	respective shareholding
in GZ Yinxin	in GZ Yingyue	in GZ Yingyou
Before Transfers	Zhang Cong Min: 70%;	Zhang Cong Min: 60%;	Zhang Cong Min: 60%;
and Fan Zeng Chun:	Yang Tian Ying: 40%	Yang Tian Ying: 40%
30%
After Transfers	Yang Tian Ying: 70%;	Fan Zeng Chun: 60%;	Fan Zeng Chun: 60%;
and Fan Zeng Chun:	Yang Tian Ying: 40%	Yang Tian Ying: 40%
30%

Due to the change in shareholding structure in GZ Yingxin, GZ Yingyue and GZ Yingyou subsequent to the Transfers and the fact that Zhang Cong Min previously entered into certain agreements under the Amended and Restated PConline Structure Contracts, the Amended and Restated PClady Structure Contracts and the Existing PChouse Structure Contracts in her capacity of shareholder of GZ Yingxin, GZ Yingyue and GZ Yingyou respectively, the Termination Agreements were entered into on 15 February 2019, the principal terms of which are set out as follows:

Termination Agreement	Termination Agreement
(Amended and Restated	(Amended and Restated	Termination Agreement
PConline Structure	PClady Structure	(Existing PChouse Structure
Contracts)	Contracts)	Contracts)

Parties:	(i)	GZP Computer	(i)	GZFW Technology	(i)	GZYR Technology
(ii)	GZ Yingxin	(ii)	GZ Yingyue	(ii)	GZ Yingyou
(iii)	GDP Internet	(iii)	GZS Internet	(iii)	GZ Shangcong Online
(iv)	Zhang Cong Min	(iv)	Zhang Cong Min	(iv)	Zhang Cong Min
(v)	New GZ Yingxin	(v)	the New GZ Yingyue	(v)	the New GZ Yingyou
Shareholders	Shareholders	Shareholders
Subject Matter:

The relevant parties thereto agreed that the Amended and Restated PConline Structure

Contracts, the Amended and Restated PClady Structure Contracts and the Existing PChouse Structure Contracts shall lapse automatically from the date of signing of the agreement (as applicable).

The relevant parties thereto shall enter into the Further Amended and Restated Structure Contracts.

The Further Amended and Restated Structure Contracts were entered into among the relevant Domestic Entities and the New PRC Opcos Shareholders immediately upon the execution of the Termination Agreements. The details of the Further Amended and Restated Structure Contacts are set out below. The corporate structure of the Group under structure contracts arrangements after the Transfers is set out in Schedule B of this announcement.

DETAILS OF THE FURTHER AMENDED AND RESTATED STRUCTURE CONTRACTS

• 1. Exclusive Management Consultation Service Agreements

  Pursuant to the exclusive management consultation service agreements respectively entered into by (i) GZP Computer and GDP Internet, (ii) GZFW Technology and GZS Internet, and (iii) GZYR Technology and GZ Shangcong Online on 15 February 2019, GZP Computer, GZFW Technology and GZYR Technology agreed to provide management and consultation services to GDP Internet, GZS Internet and GZ Shangcong Online, respectively, in return for payment of a fixed annual consultancy services fee and an annual floating fee to be mutually agreed between the parties, calculated on the basis of the scope of management and consulting services rendered and time incurred to provide such services.

  In addition, without prior written consent respectively from GZP Computer, GZFW Technology and GZYR Technology, GDP Internet, GZS Internet and GZ Shangcong Online shall not receive any other management or consultation service with the same or similar nature from other third parties. All intellectual property rights arising from or in relation to the performance of the exclusive management consultation service agreements shall belong to GZP Computer or GZFW Technology or GZYR Technology (as applicable) accordingly.

  Each of the exclusive management consultation service agreements is for a term of 20 years commencing from the date of signing of the agreement, and can be extended at the respective discretion of GZP Computer, GZFW Technology and GZYR Technology that are entitled to unilaterally terminate the exclusive management consultation service agreements.

• 2. Exclusive Technical Support and Technical Service Agreements

  Pursuant to the exclusive technical support and technical service agreements respectively entered into by (i) GZP Computer and GDP Internet, (ii) GZFW Technology and GZS Internet and (iii) GZYR Technology and GZ Shangcong Online on 15 February 2019, GZP Computer, GZFW Technology and GZYR Technology agreed to provide certain technical support and technical services to GDP Internet, GZS Internet and GZ Shangcong Online, respectively, in return for payment of a fixed annual service fee and an annual floating fee to be mutually agreed between the parties, calculated on the basis of the scope of technical support