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 Wai Chun Group Holdings Limited, you should at once hand this circular together with the enclosed proxy form to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser or the transferee.

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.

偉俊集團控股有限公司

Wai Chun Group Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock code: 1013)

(I) CONNECTED TRANSACTION: PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE; AND (II) NOTICE OF SPECIAL GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

The notice convening the special general meeting (the "SGM") of Wai Chun Group Holdings Company Limited (the "Company") to be held at Rooms 4001-02, 40/F., China Resources Building, 26 Harbour Road, Wanchai, Hong Kong at 3:30 p.m. on Friday, 20 June 2025 is set out on pages 66 to 68 of this circular.

A proxy form for the SGM is also enclosed with this circular. Whether or not you are able to attend the SGM in person, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the Company's branch share registrar in Hong Kong, Union Registrars Limited at Suites 3301-04, 33/F., Two Chinachem Exchange Square, 338 King's Road, North Point, Hong Kong as soon as possible, and in any event not less than 48 hours before the time appointed for holding the SGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjournment thereof (as the case may be) should you so wish.

For identification purpose only

2 June 2025

CONTENTS

Page

Definitions 1
Letter from the Board. 5
Letter from the Independent Board Committee 26
Letter from the Independent Financial Adviser 28
Appendix - Statutory and General Information 62
Notice of SGM 66

DEFINITIONS

In this circular, the following expressions shall have the following meanings unless the context requires otherwise:

"Announcement"
the announcement of the Company dated 11 April 2025 in respect of the Subscription Agreement and the transactions contemplated thereunder

"associate"
has the meaning ascribed thereto under the Listing Rules

"Board"
the board of Directors

"Business Day"
a day (excluding Saturday, Sunday, public holiday and any day on which a tropical cyclone warning signal no. 8 or above is hoisted or remains hoisted between 9:00 a.m. and 12:00 noon and is not lowered at or before 12:00 noon or on which a "black" rainstorm warning signal is hoisted or remains in effect between 9:00 a.m. and 12:00 noon and is not discontinued at or before 12:00 noon) on which licensed banks in Hong Kong are open for business throughout their normal business hours

"Company"
Wai Chun Group Holdings Limited, a company incorporated in Bermuda, whose issued Shares are listed on the Main Board of the Stock Exchange (stock code: 1013)

"Completion Date"
the date of closing, being the day falling on the second Business Day (or such other day as agreed by the Company and the Subscriber) after fulfillment of all the conditions precedent set out in the Subscription Agreement which is expected to be 30 May 2025

"connected person(s)"
has the meaning ascribed thereto under the Listing Rules

"Conversion Price"
HK$0.09 per Conversion Share, subject to adjustments and the terms and conditions of the New Convertible Bonds

"Conversion Rights"
the rights attached to the New Convertible Bonds to convert the New Convertible Bonds to Conversion Shares at the Conversion Price

"Conversion Share(s)"
new Shares to be issued by the Company upon the exercise of the conversion rights attaching to the New Convertible Bonds by the Existing Bondholder A

"Debt Settlement"
the settlement of the Shareholder's Loan and the Other Loan

"Director(s)"
the director(s) of the Company

DEFINITIONS

“Existing Bondholder A”
Mr. Lam Ching Kui, being the ultimate controlling shareholder of the Company and the holder of the Existing First Convertible Bonds, the Existing Second Convertible Bonds and the New Convertible Bonds

“Existing Bondholder B”
Ka Chun, being the immediate parent company of the Company and the holder of the Existing Third Convertible Bonds

“Existing Bondholders”
the Existing Bondholder A and the Existing Bondholder B

“Existing Convertible Bonds”
Existing First Convertible Bonds with principal amount of HK$152,000,000, Existing Second Convertible Bonds with principal amount of HK$23,480,000 and Existing Third Convertible Bonds with principal amount of HK$42,700,000

“Existing First Convertible Bonds”
the 0% coupon convertible bonds with principal amount of HK$152,000,000 issued by the Company on 31 August 2020

“Existing Second Convertible Bonds”
the 0% coupon convertible bonds with principal amount of HK$23,480,000 issued by the Company on 30 November 2020

“Existing Third Convertible Bonds”
the 0% coupon convertible bonds with principal amount of HK$42,700,000 issued by the Company on 17 January 2022

“Group”
the Company and its subsidiaries

“HK$”
Hong Kong dollars, the lawful currency of Hong Kong

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

“IFA” or “INCU”
INCU Corporate Finance Limited, a corporation licensed to carry out business in Type 6 (advising on corporate finance) regulated activity under the SFO, being the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate)

“Independent Board Committee”
an independent board committee comprising the independent non-executive Directors which has been established by the Board to advise the Independent Shareholders as to the fairness and reasonableness of the Alteration of Terms and the transactions contemplated thereunder (including the grant of the Specific Mandate)

– 2 –

DEFINITIONS

"Independent Shareholder(s)"
the Shareholders not required under the Listing Rules to abstain from voting on the resolution(s) approving the Subscription Agreement and the transactions contemplated respectively thereunder at the SGM

"Ka Chun"
Ka Chun Holdings Limited, a company incorporated in the British Virgin Islands, which is the legal and beneficial owner of 194,292,325 Shares as at the Latest Practicable Date, and is wholly-owned by the Existing Bondholder A through Wai Chun Investment Fund, which is also wholly-owned by him

"Last Trading Date"
11 April 2025, being the last trading day of the Shares on the Stock Exchange prior to the date of the Announcement

"Latest Practicable Date"
29 May 2025, being the latest practicable date prior to the printing of this circular for ascertaining certain information for inclusion in it

"Listing Committee"
has the meaning ascribed to it in the Listing Rules

"Listing Rules"
the Rules Governing the Listing of Securities on the Stock Exchange

"Long Stop Date"
30 June 2025 or such other date as may be agreed by the Company and the Subscriber

"New Convertible Bonds"
convertible bonds in an aggregate principal amount of HK$45,000,000 to be issued by the Company, and subscribed by the Existing Bondholder A, pursuant to the Subscription Agreement for the Debt Settlement

"Other Loan"
liabilities due by the Company to its controlling shareholder, Mr. Lam Ching Kui, for their assumption or payment of debts, liabilities, office rents and other expenses on behalf of the Group, which is expected to amount to HK$19,000,000 as at Completion Date at an interest rate of 6.25% per annum

"PRC"
People's Republic of China, which for the purpose of this circular shall exclude Hong Kong, Taiwan and Macau Special Administrative Region of the PRC

"SFO"
the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

DEFINITIONS

"SGM"
the special general meeting of the Company to be convened and held for the Independent Shareholders to approve the Subscription Agreement and the transactions contemplated respectively thereunder

"Share(s)"
the ordinary share(s) of par value of HK$0.01 each in the share capital of the Company

"Shareholder(s)"
holder(s) of the Share(s)

"Shareholder's Loan"
shareholder's loan due by the Company to Wai Chun Investment Fund, being the holding company of Ka Chun, which is expected to amount to HK$26,000,000 as at Completion Date at an interest rate of 6.25% per annum

"Specific Mandate"
the mandate to allot and issue the Conversion Shares upon the exercise of the Conversion Rights to be sought at the SGM

"Stock Exchange"
The Stock Exchange of Hong Kong Limited

"Subscription"
the subscription of the New Convertible Bonds by the Existing Bondholder A pursuant to the terms of the Subscription Agreement

"Subscription Agreement"
the conditional subscription agreement dated 11 April 2025 entered into between the Company and the Existing Bondholder A in relation to the Subscription

"Takeovers Code"
The Hong Kong Code on Takeovers and Mergers

"%"
per cent.

LETTER FROM THE BOARD

偉俊集團控股有限公司*

Wai Chun Group Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock code: 1013)

Executive Director:
Mr. Lam Ka Chun
(Chairman and Chief Executive Officer)

Independent Non-executive Directors:
Mr. Wan Bo
Mr. Wong Po Keung

Registered office:
Clarendon House
2 Church Street
Hamilton HM11
Bermuda

Head Office and Principal Place of Business in Hong Kong:
Rooms 4001-02, 40/F.
China Resources Building
26 Harbour Road, Wanchai
Hong Kong

2 June 2025

To the Shareholders

Dear Sir or Madam,

(I) CONNECTED TRANSACTION: PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE; AND (II) NOTICE OF SPECIAL GENERAL MEETING

As disclosed in the Announcement, the Company entered into the Subscription Agreement with the Existing Bondholder A, Mr. Lam Ching Kui (a connected person of the Company) pursuant to which the Existing Bondholder A conditionally agreed to subscribe for and the Company conditionally agreed to issue the New Convertible Bonds in the principal amount of HK$45,000,000.

The Conversion Shares will be allotted and issued under the Specific Mandate. Completion is subject to the Independent Shareholders' approval at the SGM and the listing approval to be granted by the Listing Committee. The purpose of this circular is to provide you with, among others, (i) details of the Subscription Agreement involving the issue of the New Convertible Bonds under the Specific Mandate to be sought at the SGM; (ii) a notice convening the SGM; and (iii) other information as required under the Listing Rules.

For identification purposes only

LETTER FROM THE BOARD

PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

The Subscription Agreement

On 11 April 2025, the Company entered into the Subscription Agreement with the Existing Bondholder A (a connected person of the Company) pursuant to which the Existing Bondholder A conditionally agreed to subscribe for and the Company conditionally agreed to issue the New Convertible Bonds in the principal amount of HK$45,000,000 under the Specific Mandate.

The New Convertible Bonds carry the Conversion Rights to convert into the Conversion Shares at the Conversion Price of HK$0.09 per Conversion Share (subject to adjustment). The subscription amount payable by the Existing Bondholder A under the Subscription Agreement shall be satisfied by way of offsetting the outstanding principal amount and accrued interest under the Shareholder's Loan and the Other Loan, payable by the Company to the Existing Bondholder A and/or its associates at Completion Date.

The principal terms of the Subscription Agreement are summarised below:

Date

11 April 2025

Party

(1) The Company as issuer; and
(2) Mr. Lam Ching Kui as subscriber

Subscription of New Convertible Bonds

Pursuant to the Subscription Agreement, Mr. Lam Ching Kui conditionally agreed to subscribe for New Convertible Bonds with an aggregate principal amount of HK$45,000,000.

Conditions precedent to the Subscription Agreement

Completion shall be conditional on the following conditions precedent being satisfied:

(i) the passing by the Independent Shareholders of relevant resolutions at the SGM in compliance with the requirements of the Listing Rules approving (a) the Subscription Agreement and the transactions contemplated thereunder; and (b) the issue of the New Convertible Bonds and the grant of the Specific Mandate for the allotment and issue of the Conversion Shares to Mr. Lam Ching Kui in accordance with the terms of the Subscription Agreement;
(ii) all necessary consents and approvals required to be obtained on the part of the Company in respect of the Subscription Agreement and the transactions contemplated thereunder having been obtained;

LETTER FROM THE BOARD

(iii) the Listing Committee of the Stock Exchange granting listing of and permission to deal in the Conversion Shares to be allotted and issued upon exercise of the Conversion Rights attaching to the New Convertible Bonds;

(iv) none of the warranties given by the Company thereunder having been breached in any material respect (or, if capable of being remedied, has not been remedied), or is misleading or untrue in any material respect; and

(v) none of the warranties given by Mr. Lam Ching Kui thereunder having been breached in any material respect (or, if capable of being remedied, has not been remedied), or is misleading or untrue in any material respect.

The Company shall use its best endeavours to procure the fulfilment of the conditions precedent set out in conditions (i), (ii), (iii) and (iv) above as soon as practicable and in any event on or before the Long Stop Date. Mr. Lam Ching Kui shall use its best endeavours to procure the fulfilment of the conditions precedent set out in conditions (v) above as soon as practicable and in any event on or before the Long Stop Date. The conditions precedent set out in conditions (i), (ii) and (iii) above are incapable of being waived. Mr. Lam Ching Kui may at any time by notice in writing to the Company waive the condition set out in condition (iv) above. The Company may at any time by notice in writing to Mr. Lam Ching Kui to waive the condition set out in condition (v) above.

In the event that any of the conditions precedent referred to above is not fulfilled or waived (to the extent it is capable of being waived) on or before the Long Stop Date, the Subscription Agreement shall cease and determine and no party shall have any claim against the other party in respect of any matter or thing arising out of or in connection with the Subscription Agreement save in respect of any antecedent breach of any obligation thereof.

As at the Latest Practicable Date, none of the conditions have been fulfilled.

Principal terms and conditions of the New Convertible Bonds

Issuer:	The Company
Subscriber:	Mr. Lam Ching Kui
Principal amount:	HK$45,000,000
Issue price:	100% of the principal amount of the New Convertible Bonds
Interest rate:	2% per annum accrued on a daily basis of a 365-day year and payable quarterly in arrears.
Redemption at maturity:	98% of the principal amount of the New Convertible Bonds.

LETTER FROM THE BOARD

Ranking:
The New Convertible Bonds constitute direct, unsubordinated, unconditional and unsecured obligations of the Company and shall at all times rank pari passu among themselves and with all existing and future unsubordinated and unsecured obligations of the Company, and shall entitle the holder(s) thereof to receive repayment in priority over the Shareholders.

Conversion price:
Initially HK$0.09 per Conversion Share, subject to adjustments.

Form and denomination:
The New Convertible Bonds will be issued in registered form in the denomination of HK$1,000,000 each.

Adjustment events:
If the following events occur, the Conversion Price shall be adjusted:

(a) Consolidation or sub-division of the Shares

If and whenever the Shares by reason of any consolidation or sub-division become of a different nominal amount, the conversion price in force immediately prior thereto shall be adjusted by multiplying it by the revised nominal amount and dividing the result by the former nominal amount.

Each such adjustment shall be effective from the close of business in Hong Kong on the day immediately preceding the date on which the consolidation or sub-division becomes effective.

LETTER FROM THE BOARD

(b) Capitalisation of profits or reserves

If and whenever the Company shall issue (other than in lieu of the whole or part of a cash dividend and other than issue that would amount to a capital distribution) any Shares credited as fully paid to the Shareholders by way of capitalisation of profits or reserves (including any share premium account or capital redemption reserve fund), Shares paid up out of distributable profits or reserves and/or share premium account or capital redemption reserve fund issued in lieu of the whole or any part of a relevant cash dividend, being a scrip dividend (but only to the extent that the market value of such Shares exceeds 110% of the amount of such relevant cash dividend or the relevant part thereof), the conversion price in force immediately prior to such issue shall be adjusted by multiplying it by the aggregate nominal amount of the issued Shares immediately before such issue and dividing the result by the sum of such aggregate nominal amount and the aggregate nominal amount of the Shares issued in such capitalisation.

Each such adjustment shall be effective (if appropriate retroactively) from the commencement of the day following the record date for such issue.

(c) Capital distribution

If and whenever the Company shall make any capital distribution to the Shareholders (in their capacity as such) (whether on a reduction of capital or otherwise) or shall grant to such Holders rights to acquire for cash assets of the Company or any of its subsidiaries, the conversion price in force immediately prior to such distribution or grant shall be reduced by multiplying it by the following fraction:

$$
\frac{A - B}{A}
$$

LETTER FROM THE BOARD

where:

A = the market price on the date on which the capital distribution or, as the case may be, the grant is publicly announced or (failing any such announcement) the next preceding day of the capital distribution or, as the case may be, of the grant; and

B = the fair market value on the day of such announcement or (as the case may require) the next preceding day, as determined in good faith by the independent auditors, of the portion of the capital distribution or of such right which is attributable to one Share. For avoidance of doubt, if the capital distribution is distributions in cash the fair market value shall be the cash value and determination by the independent auditors is not required.

Provided that (aa) if in the opinion of the independent auditors, the use of the fair market value as aforesaid produces a result which is significantly inequitable, such independent auditors may instead determine (and in such event the above formula shall be construed as if B meant) the amount of the said market price which should properly be attributed to the value of the capital distribution or rights; and (bb) the provisions of this paragraph (c) shall not apply in relation to the issue of Shares paid out of profits or reserves and issued in lieu of a cash dividend.

Each such adjustment shall be effective (if appropriate retroactively) from the commencement of the day following the record date for the capital distribution or grant.

10 -

LETTER FROM THE BOARD

(d) Issue of Shares for subscription by way of rights

If and whenever the Company shall offer to Shareholders new Shares for subscription by way of rights, or shall grant to Shareholders any options or warrants to subscribe for new Shares, at a price which is less than 90% of the market price on the date of the announcement of the terms of the offer or grant, the conversion price shall be adjusted by multiplying the conversion price in force immediately before the date of the announcement of such offer or grant by a fraction of which the numerator is the number of Shares in issue immediately before the date of such announcement plus the number of Shares which the aggregate of the amount (if any) payable for the rights, options or warrants and of the amount payable for the total number of new Shares comprised therein would purchase at such market price per share and the denominator is the number of Shares in issue immediately before the date of such announcement plus the aggregate number of Shares offered for subscription or comprised in the options or warrants.

Such adjustment shall be effective (if appropriate retroactively) from the commencement of the day next following the record date for the offer or grant.

Provided however that no such adjustment shall be made if the Company shall make a like offer or grant (as the case may be) at the same time to the Holders (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in any territory outside Hong Kong) as if it had exercised the Conversion Rights under the New Convertible Bonds registered in their names that the Holders hold out of the total principal amount of the New Convertible Bonds outstanding at the time of the proposed redemption.

11 -

LETTER FROM THE BOARD

(e) (aa) Issue of convertible or exchangeable securities

If and whenever the Company shall issue wholly for cash any securities which by their terms are convertible into or exchangeable for or carry rights of subscription for new Shares, and the total effective consideration per Share (as defined in this paragraph (e) below) initially receivable for such securities is less than 90% of the market price on the date of the announcement of the terms of issue of such securities, the conversion price shall be adjusted by multiplying the conversion price in force immediately prior to the issue by a fraction of which the numerator is the number of Shares in issue immediately before the date of the issue plus the number of Shares which the total effective consideration receivable for the securities issued would purchase at such market price per Share and the denominator is the number of Shares in issue immediately before the date of the issue plus the number of Shares to be issued upon conversion or exchange of, or the exercise of the subscription rights conferred by, such securities at the conversion or exchange rate or subscription price.

Such adjustment shall become effective (if appropriate retroactively) from the close of business in Hong Kong on the Business Day next preceding whichever is the earlier of the date on which the issue is announced and the date on which the Company determines the conversion or exchange rate or subscription price.

12 -

LETTER FROM THE BOARD

(bb) Modification of rights of convertible or exchangeable securities

If and whenever the rights of conversion or exchange or subscription attached to any such securities as are mentioned in section (aa) of this sub-paragraph (e) are modified so that the total effective consideration per Share (as defined below) initially receivable for such securities shall be less than 90% of the market price on the date of announcement of the proposal to modify such rights of conversion or exchange or subscription, the conversion price shall be adjusted by multiplying the conversion price in force immediately prior to such modification by a fraction of which the numerator is the number of Shares in issue immediately before the date of such modification plus the number of Shares which the total effective consideration receivable for the securities issued at the modified conversion or exchange price would purchase at such market price and of which the denominator is the number of Shares in issue immediately before such date of modification plus the number of Shares to be issued upon conversion or exchange of or the exercise of the subscription rights conferred by such securities at the modified conversion or exchange rate or subscription price.

Such adjustment shall become effective as at the date upon which such modification shall take effect. A right of conversion or exchange or subscription shall not be treated as modified for the foregoing purposes where it is adjusted to take account of rights or capitalisation issues and other events normally giving rise to adjustment of the conversion price provided that corresponding adjustment has already been made to the conversion price in respect of such an event.

13 -

LETTER FROM THE BOARD

For the purposes of this paragraph (e), the "total effective consideration" receivable for the securities issued shall be deemed to be the consideration receivable by the Company for any such securities plus the additional minimum consideration (if any) to be received by the Company upon (and assuming) the conversion or exchange thereof or the exercise of such subscription rights, and the total effective consideration per Share initially receivable for such securities shall be such aggregate consideration divided by the number of Shares to be issued upon (and assuming) such conversion or exchange at the conversion or exchange rate or the exercise of such subscription rights at the subscription price, in each case without any deduction for any commissions, discounts or expenses paid, allowed or incurred in connection with the issue.

(f) Issue of Shares being made wholly for cash at a price less than 90% of the market price per Share

If and whenever the Company shall issue wholly for cash any Shares at a price per Share which is less than 90% of the market price on the date of the announcement of the terms of such issue, the conversion price shall be adjusted by multiplying the conversion price in force immediately before the date of such announcement by a fraction of which the numerator is the number of Shares in issue immediately before the date of such announcement plus the number of Shares which the aggregate amount payable for the issue would purchase at such market price and the denominator is the number of Shares in issue immediately before the date of such announcement plus the number of Shares so issued.

Such adjustment shall become effective on the date of the issue.

14 -

LETTER FROM THE BOARD

(g) If and whenever the Company shall issue Shares for the acquisition of asset at a total effective consideration per Share (as defined in this paragraph (g) below) which is less than 90% of the market price at the date of the announcement of the terms of such issue, the conversion price shall be adjusted in such manner as may be determined by the independent auditors. Such adjustment shall become effective on the date of issue.

For the purpose of this paragraph (g) “total effective consideration” shall be the aggregate consideration credited as being paid for such Shares by the Company on acquisition of the relevant asset without any deduction of any commissions, discounts or expenses paid, allowed or incurred in connection with the issue thereof, and the “total effective consideration per Share” shall be the total effective consideration divided by the number of Shares issued as aforesaid.

Conversion Shares:

Based on the principal amount of the New Convertible Bonds of HK$45,000,000, the New Convertible Bonds is convertible into a total of 500,000,000 Conversion Shares at the initially conversion price of HK$0.09 per Conversion Share (subject to adjustments).

Conversion period:

The period commencing from the issue date of the New Convertible Bonds up to 4:00 p.m. on the day immediately prior to and exclusive of the maturity date of the New Convertible Bonds.

LETTER FROM THE BOARD

Conversion rights and restrictions:

The holder of the New Convertible Bonds shall, subject to compliance with the procedures set out in the terms and conditions thereunder, have the right at any time during the conversion period to convert the whole or part of the outstanding principal amount of the New Convertible Bonds registered in its name into the Conversion Shares provided further that (i) any conversion shall be made in amounts of not less than a whole multiple of HK$1,000,000 on each conversion save that if at any time the aggregate outstanding principal amount of the New Convertible Bonds is less than: HK$1,000,000, the whole (but not part only) of the outstanding principal amount of the New Convertible Bonds may be converted; and (ii) the exercise of the conversion right attaching to the New Convertible Bonds will not cause the Company to be unable to meet the public float requirement under the Listing Rules.

Early redemption at the option of the Company:

The Company shall be entitled at its sole discretion, by giving not less than fourteen (14) days' notice to the holders of the New Convertible Bonds, propose to the holders to redeem the outstanding New Convertible Bonds (in multiples of HK$1,000,000 or such lesser amount as may represent the entire principal amount thereof) an amount equivalent to 100% of the principal amount of such outstanding New Convertible Bonds at any time after the date of issue of the New Convertible Bonds up to and including the date falling fourteen (14) days immediately before the maturity date of the New Convertible Bonds.

Ranking of Conversion Shares:

The Conversion Shares, when allotted and issued, shall rank pari passu in all respects with the Shares in issue on the relevant conversion date including the right to all dividends or other distributions, paid or made on or after the relevant conversion date other than any dividend or other distribution previously declared or recommended or resolved to be paid or made if the record date thereof shall be on or before the relevant conversion date.

Maturity date:

The date falling on the third anniversary of the date of issue of the New Convertible Bonds.

Voting rights:

The Subscriber shall not have any right to attend or vote in any general meeting of the Company.

16 -

LETTER FROM THE BOARD

Transferability:
Subject to compliance with the Listing Rules, the New Convertible Bonds may be transferred or assigned in whole or in part in integral multiples of HK$1,000,000 by the Subscriber to any party.

Listing:
No application will be made by the Company for the listing of the New Convertible Bonds on the Stock Exchange. Application will be made to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares.

Security:
The obligations of the Company under the New Convertible Bonds are unsecured.

Conversion Shares

Upon full conversion of the New Convertible Bonds at the Conversion Price of HK$0.09 each (subject to adjustments), a maximum of 500,000,000 Conversion Shares will be allotted and issued which represents:

(i) approximately 186.99% of the issued share capital of the Company as at the Latest Practicable Date; and
(ii) approximately 65.16% of the issued share capital of the Company as to be enlarged by the allotment and issue of the Conversion Shares (assuming there is no other change to the total number of Shares from the Latest Practicable Date to the date when the Conversion Rights are exercised in full).

Conversion Price

The Conversion Price of HK$0.09 (subject to adjustments) per Conversion Share represents:

(a) a discount of approximately 40.00% to the closing price of HK$0.150 per Share as quoted on the Stock Exchange as at the Latest Practicable Date;
(b) a discount of approximately 5.26% to the closing price of HK$0.095 per Share as quoted on the Stock Exchange on the Last Trading Day;
(c) a discount of approximately 16.36% to the average closing price of approximately HK$0.1076 per Share as quoted on the Stock Exchange for the last five (5) consecutive trading days immediately preceding the Last Trading Day;

17 -

LETTER FROM THE BOARD

(d) a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) of approximately 11%, represented by the theoretical diluted price (as defined under Rule 7.27B of the Listing Rules) of approximately HK$0.0961 per Share, to the benchmarked price of HK$0.1076 per Share (as defined under Rule 7.27B of the Listing Rules, taking into account the higher of (a) the closing price of HK$0.0950 per Share on the Last Trading Day and (b) the average closing price of HK$0.1076 per Share as quoted on the Stock Exchange for the five consecutive trading days immediately preceding the Last Trading Day); and

(e) a cumulative theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) in aggregation with the Existing Convertible Bonds represented by a discount of approximately 23%, represented by the cumulative theoretical diluted price of approximately HK$0.1061 per Share to the theoretical benchmarked price of HK$0.1380 per Share in respect of the Alteration of Terms (as defined under Rule 7.27B of the Listing Rules, taking into account the benchmarked price of the Alteration of Terms, being HK$0.1380 per Share).

The Conversion Price of HK$0.09 (subject to adjustments) per Conversion Share was arrived at after arm's length negotiations between the Company and the Existing Bondholder A with reference to the recent trading prices of the Shares before entering into the Subscription Agreement for approximately one year prior to the Last Trading Day, the daily closing prices of the Shares ranged from the lowest of HK$0.080 per Share, to the highest of HK$0.260 per Share with an average closing price of HK$0.124 per Share. The Conversion Price of HK$0.090 per Share is within the said price range of the Shares and it represents a discount to the closing price of the Shares on the Last Trading Day and the average closing price of the Shares on the last five trading days immediately preceding the Last Trading Day because the Company and the Existing Bondholder A have agreed at a lower interest rate of 2% per annum which would in turn alleviate the future interest burden of the Company.

The Directors (excluding Mr. Lam Ka Chun, the son of the Existing Bondholder A who had abstained from voting due to conflict of interests) consider that the Conversion Price is fair and reasonable and is in the interests of the Shareholders as a whole.

Completion

The completion of the Subscription Agreement shall take place at or before 4:00 p.m. on the second Business Day (or such other date as agreed by the Company and the Existing Bondholder A) after fulfillment of all the conditions precedent set out above.

Minimum public float requirement

Pursuant to the terms of the New Convertible Bonds, the Conversion Rights are restricted by the public float requirement under the Listing Rules. In other words, the Existing Bondholder A may only convert such number of New Convertible Bonds into Shares which would not cause the Company to not comply with the public float requirement under the Listing Rules following the conversion.

LETTER FROM THE BOARD

Before the exercise of the Conversion Rights, the Existing Bondholder A shall deliver a written conversion notice to the Company setting out the principal amount of New Convertible Bonds to be converted into Conversion Shares. Having taken into account the conversion price as adjusted by the occurrence of triggering events as mentioned above (if any), if the issue of the Conversion Shares pursuant to the exercise of the Conversion Rights by the Existing Bondholder A would result in the Company to not comply with the minimum public float requirement under the Listing Rules, then the Company shall not allow the Existing Bondholder A to exercise such Conversion Rights so as to maintain the minimum public float requirement, and the conversion notice shall be void.

Effects on shareholding structure of the Company

For illustration purposes only, set out below the shareholding structure of the Company (i) as at the Latest Practicable Date; (ii) immediately after full conversion of all the Existing Convertible Bonds only (assuming there being no other issue or repurchase of Shares); (iii) immediately after full conversion of the New Convertible Bonds only (assuming there being no other issue or repurchase of Shares); and (iv) immediately after full conversion of all the Existing Convertible Bonds and the full conversion of the New Convertible Bonds (assuming there being no other issue or repurchase of Shares) is as follows:

Name of Shareholders	As at the Latest Practicable Date		Immediately after full conversion of all the Existing Convertible Bonds Only (note 3 and note 4)		Immediately after full conversion of New Convertible Bonds Only (note 3 and note 4)		Immediately after full conversion of all the Existing Convertible Bonds and the New Convertible Bonds (note 3 and note 4)
	Number of Approximate Shares	%	Number of Approximate Shares	%	Number of Approximate Shares	%	Number of Approximate Shares	%
Existing Bondholder A (note 1)	4,810,125	1.80	1,759,610,125	71.84	504,810,125	65.78	2,259,610,125	76.62
Existing Bondholder B (note 2)	194,292,325	72.66	621,292,325	25.37	194,292,325	25.32	621,292,325	21.07
	199,102,450	74.46	2,380,902,450	97.21	699,102,450	91.10	2,880,902,450	97.68
Other Public Shareholders (note 4)	68,287,081	25.54	68,287,081	2.79	68,287,081	8.09	68,287,081	2.32
Total	267,389,531	100.00	2,449,189,531	100.00	767,389,531	100.00	2,949,189,531	100.00

Notes:
(1) Mr. Lam Ching Kui, being the Existing Bondholder A and the ultimate controlling shareholder of the Company, directly holds 4,810,125 Shares.
(2) Ka Chun Holdings Limited, being the Existing Bondholder B, is a company owned as to 100% by Wai Chun Investment Fund, which is wholly-owned by Mr. Lam Ching Kui, Ka Chun Holdings Limited directly holds 194,292,325 Shares.
(3) Certain percentage figures included in the above tables have been subject to rounding adjustments. Accordingly, figures shown as totals may not be an arithmetic aggregation of the figures preceding them.

LETTER FROM THE BOARD

(4) Pursuant to the terms and conditions of the Existing Convertible Bonds and the New Convertible Bonds, the bondholders shall not exercise the conversion rights attached or attaching to the Existing Convertible Bonds and the New Convertible Bonds if, as a result of such exercise, it will cause the public float of the Company to fall below the percentage prescribed under the Listing Rules, and any conversion shall also be subject to no mandatory general offer being triggered under Rule 26 of the Takeovers Code on the bondholder.

Dilution and financial effects of the issue of the New Convertible Bonds

For indicative purposes only and subject to the minimum public float requirement of the Listing Rules and the relevant restrictions under the Subscription Agreement, upon full conversion of the New Convertible Bonds at the Conversion Price, the New Convertible Bonds will be convertible into 500,000,000 new Shares, representing approximately 186.99% of the total number of issued Shares and approximately 65.16% of the total number of issued Shares as enlarged by the allotment and issue of the Conversion Shares as at the Latest Practicable Date.

Assuming no outstanding Share Options being exercised and that there is no change in the number of issued Shares from the Latest Practicable Date up to the date when the Conversion Rights are exercised in full, the existing shareholding of the Independent Shareholders will be diluted from approximately 25.54% before full conversion of the New Convertible Bonds to approximately 8.09% immediately after full conversion of the New Convertible Bonds. However, as mentioned above, it has been set out in the terms of the New Convertible Bonds that the Existing Bondholder A may only convert such number of New Convertible Bonds that would not cause the Company to not comply with the minimum public float requirement under the Listing Rules following the conversion.

In view of (i) the reasons for and benefits of entering into the Subscription Agreement as set out below; (ii) the terms of the Subscription Agreement and the New Convertible Bonds being fair and reasonable and in the interests of the Shareholders as a whole; and (iii) the minimum public float requirement of the Listing Rules and relevant restrictions under the Subscription Agreement, the Board is of the view that the feasible level of dilution (subject to the minimum public float requirement of the Listing Rules and the relevant restrictions under the Subscription Agreement) to the shareholding interests of the Independent Shareholders is acceptable.

Equity fund raising activities of the Company in the past 12 months

In the past twelve months immediately preceding the Latest Practicable Date, the Company and the Existing Bondholders have entered into alteration consent letters and conditionally agreed to amend the terms of all the Existing Convertible Bonds with total principal amount of HK$218,180,000 under specific mandate as disclosed in the circular of the Company dated on 12 December 2024 and which was approved in the SGM held on 8 January 2025 and completed on 17 January 2025. The subscription amount was satisfied by way of offsetting certain debt liabilities owed by the Company to the Existing Bondholder A and/or its associates and there was no remaining net proceeds from such fund-raising exercise to be utilised by the Company.

Save as disclosed above, the Company has not conducted any equity fund raising activity in the past twelve-month period immediately preceding the Latest Practicable Date.

20 -

LETTER FROM THE BOARD

Mandate to issue the Conversion Shares

The issue and allotment of the Conversion Shares under the Specific Mandate are subject to the approval of the Independent Shareholders at the SGM.

USE OF PROCEEDS FROM PROPOSED ISSUE OF NEW CONVERTIBLE BONDS

The gross proceeds from the issue of the New Convertible Bonds are expected to be approximately HK$45,000,000. The subscription amount payable by the Existing Bondholder A under the Subscription Agreement shall be satisfied by way of offsetting the outstanding principal amount and accrued interest under the Shareholder's Loan and Other Loan, payable by the Company to the Existing Bondholder A and/or its associates which is expected to amount to a total of HK$45,000,000 as at Completion Date.

OTHER FUND-RAISING METHOD

The Board has explored other fund-raising methods including debt financing and equity financing before entering into the Subscription Agreement. External debt financing such as bank loan would give additional financial pressure to the Group and would further weaken the cash flow and financial position of the Group. In addition, the Group has difficulties in obtaining external debt financing from financial institutions due to the weak financial performance and net current liabilities position of the Group. It is expected that the cost of external debt financing would be higher and the terms of the external debt financing might require a higher interest rate, pledge of assets or financial guarantee.

The Board has also explored but not decided to conduct equity placement to independent third parties that might require a higher discount on the placing price and would bring an immediate dilution effect on the shareholding of the Company. Additional financial burden to the Group would arise as equity placement would incur placing commission to the placing agent and other professional expenses. The placing agent has difficulties to seek potential places due to the weak financial performance and net current liabilities position of the Group, and the low trading volume of the Shares. Besides, conducting equity financing by way of right issue or open offer might require a higher discount on the issue price, a lengthier process and a higher cost to professional parties for such fund-raising exercise, and would cause immediate dilution to the Shareholders who do not participate in the right issue or open offer as compared to the Subscription which does not bring any immediate dilution effect on the shareholding of the Company.

As at the Latest Practicable Date, other than the Subscriber, no investor has shown any interest in providing debt or equity financing to the Company.

Having considered the above factors, the Board considers that the Subscription is the feasible and realistic option for the Group to improve its short-term liquidity position and avoid immediate dilution effect on the shareholding of the Independent Shareholders although the Group may still have a relatively high gearing ratio in the short run. The Board considers that the Subscription is in the interests of the Company and the Shareholders as a whole and it will provide financial flexibility to the Group in managing its future cash flow with the reclassification of the Shareholder's Loan and the Other Loan (together with the accrued interest) from current liabilities to non-current liabilities after the Subscription becomes effective at the Completion Date. The reduction in the interest rates will ease the interest burden of the Company.

21 -

LETTER FROM THE BOARD

REASONS FOR AND BENEFITS OF ENTERING INTO THE SUBSCRIPTION AGREEMENT

The Company is an investment holding company incorporated in Bermuda, whose issued Shares are listed on the Main Board of the Stock Exchange. The Group is principally engaged in (i) general trading; (ii) sales and integration services of computer and communication systems, and design, consultation and production of information system software and management training services.

The subscription amount payable by the Existing Bondholder A under the Subscription Agreement shall be satisfied by way of offsetting the outstanding principal amount and accrued interest under the Shareholder's Loan and the Other Loan, payable by the Company to the Existing Bondholder A and/or its associates as at Completion Date. Since the Group incurred losses of approximately HK$36,474,000 and HK$16,471,000 for the year ended 31 March 2024 and the six months ended 31 September 2024 and had low cash and bank balance of only approximately HK$127,000 as at 31 March 2024 and HK$144,000 as at 31 March 2024 and 31 September 2024 respectively, the Existing Bondholder A had been financing the operations of the Group through the provision of the Shareholder's Loan and the Other Loan to the Group. The aggregate amount of the Shareholder's Loan and Other Loan and accrued interest is approximately HK$44,800,000 as at the Latest Practicable Date and is expected to increase to HK$45,000,000 as at Completion Date due to the additional financial support by the Existing Bondholder A and Wai Chun Investment Fund, which is wholly owned by the Existing Bondholder A. The Shareholder's Loan and the Other Loan are unsecured, carried fixed interest rate at 6.25% per annum and repayable on demand as at the Latest Practicable Date.

The Board considers that the Shareholder's Loan which bears interest at 6.25% per annum together with the Other Loan which is also owed to the controlling Shareholder, the Existing Bondholder A, represents a heavy financial burden to the Group as the Company has a capital deficit of HK$257,303,000 as at 30 September 2024. In view of the above, the Board has reviewed and explored different approaches to settle the Shareholder's Loan and the Other Loan (together with the accrued interest) The Company has reached out with banks and financial institutions for external financing, however it was not feasible due to the weak financial performance and the net current liabilities and net liabilities position of the Group as at 31 March 2024 and 30 September 2024. As at the Latest Practicable Date, no bank or financial institution has shown any interest in providing financing to the Company. After the negotiation between the Company and the Existing Bondholder A, Existing Bondholder A did not accept the nil interest rate as proposed by the Company and only agreed to subscribe for the New Convertible Bonds unless the Company accepted his proposal in respect of the Subscription. The Board considers the issue of the New Convertible Bonds to be the most effective and suitable for reducing the amount of interest expense incurred by the Group per annum, enhancing the financial position of the Group and reducing the gearing ratio of the Group and is in the interests of the Shareholders as a whole even though the proposed interest rate of the New Convertible Bonds is higher than that of the Existing Convertible Bonds after considering that (i) the New Convertible Bonds bear a lower interest rate of 2% per annum and will be able to minimize the short-term financial burden to the Group as total interest in three years amounting to approximately HK$5.74 million will be saved; (ii) the net current liabilities of the Group as at the Latest Practicable Date will also be improved as the Shareholder's Loan and the Other Loan (together with the accrued interest), which has been included in the current liabilities as at the Latest Practicable Date, will be reclassified from current liabilities to non-current liabilities after the Subscription becomes effective at the Completion Date; (iii) the financial pressure on the Company for redemption of the New Convertible Bonds at the maturity date would also be lessened because of the redemption discount of 2% at the maturity of the New Convertible Bonds; (iv) the principal amount of the Shareholder's Loan and the Other Loan (together

22 -

LETTER FROM THE BOARD

with the accrued interest) will be fully settled upon the exercise in full of the Conversion Rights without requiring any cash outflow; and (v) the issue of the New Convertible Bonds does not have an immediate dilution effect on the shareholding of the Company subject to the minimum public float requirement under the Listing Rules.

In view of the above, the Directors (excluding Mr. Lam Ka Chun, the son of the Existing Bondholder A who had abstained from voting due to conflict of interest) are of the view that the terms of Subscription Agreement are on normal commercial terms and the issue of the New Convertible Bonds are fair and reasonable, and in the interests of the Company and the Shareholders as a whole.

LISTING RULES IMPLICATIONS

Mr. Lam Ching Kui, the Existing Bondholder A, is the ultimate controlling shareholder of the Company, who is interested in 4,810,125 Shares personally, representing approximately 1.80% of the total number of the issued Shares, and through his indirect interests in the Existing Bondholder B, Ka Chun, was taken to be interested in total 199,102,450 Shares representing approximately 74.46% of the total number of the issued Shares as at the Latest Practicable Date. Accordingly, the Existing Bondholder A is a connected person of the Company and the Subscription constitutes a connected transaction under the Listing Rules and will be subject to reporting and announcement requirements, as well as the approval of the Independent Shareholders at the SGM by way of poll. The Existing Bondholder A and its associates (including the Existing Bondholder B) will abstain from voting for the relevant resolutions approving the Subscription Agreement at the SGM.

The Existing Bondholder A is an investor who has made investments in listed securities and has been engaged in industrial and residential property development in the PRC and commercial property investment in Hong Kong for over 30 years. The Existing Bondholder A is the father of Mr. Lam Ka Chun (the chairman and chief executive officer of the Company), who is deemed to be interested in the Subscription and was required to abstain from voting on the resolutions passed by the Board to approve the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate).

An application will be made to the Stock Exchange for its approval for the listing of, and permission to deal in the Conversion Shares pursuant to the terms and conditions of the New Convertible Bonds.

THE INDEPENDENT BOARD COMMITTEE

The Independent Board Committee has been established, comprising all the independent non-executive Directors, to advise the Independent Shareholders in relation to the Subscription Agreement and the transactions contemplated thereunder, including but not limited to the issue of the New Convertible Bonds, the allotment and issue of the Conversion Shares, and the grant of the Specific Mandate. INCU has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

23 -

LETTER FROM THE BOARD

SPECIAL GENERAL MEETING

The SGM will be held by the Company at Rooms 4001-02, 40/F., China Resources Building, 26 Harbour Road, Wanchai, Hong Kong at 3:30 p.m. on Friday, 20 June 2025, to consider and if thought fit, to approve, among other things, the entering into of the Subscription Agreement and the transactions contemplated thereunder.

The Existing Bondholder A and its associates (including the Existing Bondholder B) shall abstain from voting on the resolutions approving the Subscription Agreement and the transactions contemplated thereunder at the SGM. As at the Latest Practicable Date, to the best knowledge of the Directors, other than the Existing Bondholder A and its associates (including the Existing Bondholder B), no other Shareholder is required to abstain from voting on the resolutions to be proposed at the SGM.

The notice of the SGM is set out on pages 66 to 67 of this circular.

PROXY ARRANGEMENT

The form of proxy for use at the SGM is enclosed with this circular. Such form of proxy is also published on the website of the Stock Exchange and the website of the Company. For those who intend to direct a proxy to attend the SGM, please complete the form of proxy and return the same in accordance with the instructions printed thereon. In order to be valid, the above documents must be delivered to the Company's branch share registrar in Hong Kong, Union Registrars Limited at Suites 3301-04, 33/F., Two Chinachem Exchange Square, 338 King's Road, North Point, Hong Kong not less than 48 hours before the time appointed for the SGM or any resumed session.

You are urged to complete and return the form of proxy whether or not you intend to attend the SGM. Completion and return of the form of proxy will not preclude you from attending and voting at the SGM (or any subsequent meetings following the adjournments thereof) should you wish to do so.

CLOSURE OF REGISTER OF MEMBERS

The register of members of the Company will be closed from Tuesday, 17 June 2025 to Friday, 20 June 2025 (both days inclusive), during which time no share transfers will be effected. The Shareholders whose names appear on the register of members of the Company on 20 June 2025 are entitled to attend and vote in respect of the resolution to be proposed at the SGM.

RECOMMENDATION

The Independent Board Committee, having considered the advice from IFA, considers that (i) the terms of the Subscription Agreement are fair and reasonable; (ii) the terms of the Subscription Agreement are on normal commercial terms; and (iii) the Subscription Agreement and the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole. Accordingly, the Independent Board Committee has recommended the Independent Shareholders to vote in favour of the resolutions in respect of the Subscription Agreement to be proposed at the SGM.

LETTER FROM THE BOARD

The Directors, excluding Mr. Lam Ka Chun (the son of the Existing Bondholder A) who had abstained from voting at the Board meeting due to conflict of interest, consider the terms of the Subscription Agreement are fair and reasonable in the best interests of the Company and the Shareholders as a whole. Accordingly, the Directors (excluding Mr. Lam Ka Chun) recommend the Independent Shareholders to vote in favour of the resolution in respect of the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate) to be proposed at the SGM.

The recommendation of the Independent Board Committee is set out on pages 26 to 27 in this circular and the letter from IFA is set out on pages 28 to 61 in this circular.

VOTE BY POLL

In accordance with Rule 13.39(4) of the Listing Rules and the Bye-laws of the Company, all the votes at the SGM must be taken by poll. The methods of voting by the Shareholders at the SGM will be conducted by the combination of on-site voting and online voting. The Company will appoint scrutineers to handle vote-taking procedures at the SGM. An announcement on the poll results will be published by the Company after the SGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

ADDITIONAL INFORMATION

Your attention is also drawn to the information set out in the appendix to this circular.

By Order of the Board

Wai Chun Group Holdings Limited

Lam Ka Chun

Chairman and Chief Executive Officer

25 -

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

偉俊集團控股有限公司

Wai Chun Group Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock code: 1013)

2 June 2025

To the Shareholders

Dear Sirs or Madam,

CONNECTED TRANSACTION: PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

We refer to the circular of the Company dated 2 June 2025 (the "Circular"), of which this letter forms part. Unless otherwise indicated, capitalised terms used herein shall have the same meanings as those defined in the Circular.

The Independent Board Committee has been formed to consider and advise you in respect of the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate), details of which are set out in the "Letter from the Board" contained in the Circular. INCU has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in this regard. The text of the letter of advice from IFA containing its recommendations and the principal factors and reasons in which INCU has taken into consideration in arriving at its recommendations is set out on pages 28 to 61 of the Circular.

Having considered the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate), and after taking into account the principal factors and reasons and the advice of IFA as set out in the "Letter from IFA", contained in the Circular, we consider that the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate), though not in the ordinary and usual course of business of the Group, are on normal commercial terms, fair and reasonable so far as the Company and the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole.

For identification purposes only
26 -

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolutions to be proposed at the SGM in respect of the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate).

Yours faithfully

For and on behalf of the

Independent Board Committee

Wai Chun Group Holding Limited

Mr. Wan Bo
Independent non-executive Director

Mr. Wong Po Keung
Independent non-executive Director

27 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the text of a letter of advice from INCU Corporate Finance Limited, which has been prepared for the purpose of incorporation into this circular, setting out its opinion to the Independent Board Committee and the Independent Shareholders in connection with the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate).

INCU

INCU Corporate Finance Limited
Unit 1402, 14/F, Winsome House,
73 Wyndham Street,
Central, Hong Kong

2 June 2025

To: The Independent Board Committee and
the Independent Shareholders of
Wai Chun Group Holdings Limited

Dear Sirs and Madams,

CONNECTED TRANSACTION IN RELATION TO PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

INTRODUCTION

We refer to our appointment as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate), particulars of which are set out in the Letter from the Board (the "Letter from the Board") contained in the circular of the Company to the Shareholders dated 2 June 2025 (the "Circular"), of which this letter forms part. Terms used in this letter shall have the same meanings as those defined in the Circular unless the context requires otherwise.

Reference is made to the Announcement, on 11 April 2025 (after trading hours), the Company entered into the Subscription Agreement with Existing Bondholder A, Mr. Lam Ching Kui (a connected person of the Company), pursuant to which Existing Bondholder A conditionally agreed to subscribe for and the Company conditionally agreed to issue the New Convertible Bonds in the principal amount of HK$45,000,000.

As at the Latest Practicable Date, Mr. Lam Ching Kui, being Existing Bondholder A, is the ultimate controlling shareholder of the Company, who is interested in 4,810,125 Shares personally, representing approximately 1.80% of the total number of the issued Shares, and through his indirect interests in Existing Bondholder B, Ka Chun, was taken to be interested in total 199,102,450 Shares representing approximately 74.46% of the total number of the issued Shares. Therefore, Existing Bondholder A and its associates (including Existing Bondholder B) are connected persons of the Company, and the Subscription constitutes a connected transaction of the Company and is subject to the reporting, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

28 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Existing Bondholder A and its associates (including Existing Bondholder B) are required to abstain from voting on the resolutions in respect of the Subscription at the SGM. To the best of the information, belief and knowledge of the Directors, save for Existing Bondholder A and its associates (including Existing Bondholder B), no other Shareholder has any material interest in the Subscription and the grant of the Specific Mandate. Save that Mr. Lam Ka Chun, who is an executive director of the Company and the son of Existing Bondholder A, is deemed to be interested in the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate), who had abstained from voting, none of the Directors had a material interest in the Subscription and was required to abstain from voting on the resolutions passed by the Board to approve the Subscription and the transactions contemplated thereunder (including the grant of the Specific Mandate).

INDEPENDENT BOARD COMMITTEE

The Independent Board Committee comprising all the independent non-executive Directors, namely Mr. Wan Bo and Mr. Wong Po Keung, has been established to advise the Independent Shareholders in respect of the terms of the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate) are fair and reasonable so far as the Independent Shareholders as concerned, and in the interest of the Company and the Shareholders as a whole, taking into account our recommendation.

We, INCU Corporate Finance Limited, have been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

Except for being appointed as independent financial adviser to the Company regarding (i) the alteration to the terms of the Existing First Convertible Bonds and Existing Second Convertible Bonds, which the circular has been despatched on 20 October 2023; and (ii) the alteration to the terms of the Existing Convertible Bonds, which the circular has been despatched on 13 December 2024, we have not acted as an independent financial adviser and have not provided any other services to the Company during the past two years. As at the Latest Practicable Date, we were not aware of any relationships or interests between us and the Company or any other parties that could be reasonably be regarded as hindrance to our independence as defined under Rule 13.84 of Listing Rules to act as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in respect of the Subscription. We are not associated with the Company, its subsidiaries, its associates or their respective substantial shareholders or associates or any other parties to the Subscription, and accordingly, are eligible to give independent advice and recommendations on the terms of the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate). Apart from normal professional fees payable to us in connection with this appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders, no arrangement exists whereby we will receive any fees from the Company, its subsidiaries, its associates or their respective substantial shareholders or associates or any other parties that could reasonably be regarded as relevant to our independence.

29 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

BASIS OF OUR OPINION

In formulating our opinion and recommendations, we have relied on the statements, information, opinions and representations contained or referred to in the Circular and/or provided to us by the Company and the management of the Group. We have assumed that all statements, information, opinions and representations contained or referred to in the Circular and/or provided to us were true, accurate and complete at the time they were made and continued to be so as at the Latest Practicable Date. The Directors jointly and severally accept full responsibility for the accuracy of the information contained in the Circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, opinions expressed by them in the Circular have been arrived at after due and careful consideration and there are no other material facts not contained in the Circular, the omission of which would make any such statement made by them that contained in the Circular misleading in all material respects. We have no reason to doubt the truth or accuracy of the information provided to us, or to believe that any material information has been omitted or withheld. We will notify the Shareholders of any material change of information in the Circular up to the date of SGM.

Our review and analyses were based upon, among others, (i) the information provided by the Group including the Circular, the Subscription Agreement and certain published information from the public domain, including but not limited to, the annual report of the Company for the year ended 31 March 2024 (the "Annual Report 2023/24") and interim report of the Company for the six months ended 30 September 2024 (the "Interim Report 2024/25"); and (ii) our discussion with the Directors and the management of the Group with respect to the terms of and the reasons for entering into of the Subscription Agreement, the businesses and future outlook of the Group. We have not, however, for the purpose of this exercise, conducted any in-depth independent investigation into the businesses or affairs and future prospects of the Group and the subscriber nor have we carried out any independent verification of the information supplied.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our opinions and recommendations in respect of the Subscription, we have taken into consideration of the following principal factors and reasons:

(I) Background of the Subscription

On 11 April 2025 (after trading hours), the Company entered into the Subscription Agreement with Existing Bondholder A, Mr. Lam Ching Kui (a connected person of the Company), pursuant to which Existing Bondholder A conditionally agreed to subscribe for and the Company conditionally agreed to issue the New Convertible Bonds in the principal amount of HK$45,000,000.

As at the Latest Practicable Date, Mr. Lam Ching Kui, being Existing Bondholder A, is the ultimate controlling Shareholder, who is interested in 4,810,125 Shares personally, representing approximately $1.80\%$ of the total number of the issued Shares, and through his indirect interests in Existing Bondholder B, Ka Chun, was taken to be interested in total 199,102,450 Shares representing approximately $74.46\%$ of the total number of the issued Shares. Mr. Lam Ching Kui and Ka Chun are also the holders of the Existing Convertible Bonds. The Existing Convertible Bonds with the total outstanding amount of HK$218.18 million could be converted at the conversion price of HK$0.1 per Share to a maximum of 2,181,800,000 Shares in total, but subject to the restriction of the public float requirement under the Listing Rules.

30 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Existing Bondholder A is an investor who has made investments in listed securities and has been engaged in industrial and residential property development in the PRC and commercial property investment in Hong Kong for over 30 years. Existing Bondholder A is the father of Mr. Lam Ka Chun, the chairman and chief executive officer of the Company.

(II) Background and financial performance of the Group

(i) Background of the Group

The Company is an investment holding company incorporated in Bermuda with limited liability, the issued shares of which are listed on the Main Board of the Stock Exchange.

The Group is principally engaged in (i) general trading (the "General Trading"); and (ii) sales and integration services of computer and communication systems, and design, consultation and production of information system software and management training services (the "Sales and Integration Services").

(ii) Financial performance of the Group

Set out below is the financial information of the Group for each of the financial years ended 31 March 2023 and 31 March 2024 ("FY2023" and "FY2024", respectively) as extracted from the Annual Report 2023/24 and the six months ended 30 September 2023 and 30 September 2024 ("HY2023/24" and "HY2024/25", respectively) as extracted from the Interim Report 2024/25:

Consolidated financial performance of the Group

| | FY2023
HK$'000
(Audited) | FY2024
HK$'000
(Audited) | HY2023/24
HK$'000
(Unaudited) | HY2024/25
HK$'000
(Unaudited) |
| --- | --- | --- | --- | --- |
| Revenue from General Trading | 170,419 | 241,956 | 120,248 | 21,915 |
| Revenue from Sales and Integration Services | 6,384 | 31,933 | 32,136 | 21,210 |
| Total revenue | 176,803 | 273,889 | 152,384 | 43,125 |
| Loss for the year/period | (51,752) | (36,474) | (18,686) | (16,471) |
| Loss for the year/period attributable to the owners of the Company | (50,721) | (36,531) | (18,969) | (16,813) |

Table 1: Summary of the consolidated financial performance of the Group

31 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

FY2023 vs FY2024

As set out in above Table 1, the revenue of the Group for FY2024 was approximately HK$273.89 million, representing an increase of approximately HK$97.09 million or 54.9% as compared with that of approximately HK$176.80 million for FY2023. According to the Annual Report 2023/24, the increase in revenue was mainly due to (a) the substantial increase in revenue of General Trading of approximately HK$71.54 million, which the demand for chemical trading rebounded after the resumption of normal operation and the release of the anti-pandemic measures of COVID-19 in the PRC; and (b) the substantial increase in revenue of Sales and Integration Services of approximately HK$25.55 million as a result of the release of the anti-pandemic measures of COVID-19 in the PRC causing a strong rebound of the demand from the market.

Due to the increase in revenue of the Group for FY2024, the Group recorded loss attributable to the owners of the Company of approximately HK$36.53 million for FY2024, representing a decrease in loss of approximately HK$14.19 million or 27.98% as compared with that of approximately HK$50.72 million for FY2023. As a result, the Group recorded net cash outflow from operating activities of approximately HK$8.79 million and HK$8.52 million for FY2023 and FY2024 respectively.

We also noted that the Group recorded finance costs of approximately HK$26.16 million and HK$26.41 million for FY2023 and FY2024 respectively, which had created continuous financial pressure to the Group.

HY2023/24 vs HY2024/25

The revenue of the Group for HY2024/25 was approximately HK$43.13 million, representing a decrease of approximately HK$109.25 million or 71.70% as compared with that of approximately HK$152.38 million for HY2023/24. According to the Interim Report 2024/25 and our discussion with the management of the Company, the decrease in revenue was due to (i) the substantial decrease in revenue of General Trading of approximately HK$98.33 million as a result of the decrease in demand of chemical product caused by the economic slowdown in the PRC, which leaded to the decrease in purchase orders from PRC customers; and (ii) the decrease in revenue of Sales and Integration Services of approximately HK$10.92 million as a result of the decrease in customer's order of the services of integration system after end of contracts of two customers.

The loss attributable to the owners of the Company was approximately HK$16.81 million for HY2024/25, representing a decrease in loss of approximately HK$2.16 million or 11.39% as compared with that of approximately HK$18.97 million for HY2023/24. Such decrease was mainly due to combined effect of (i) the decrease in revenue of the Group as discussed above; (ii) the decrease in administrative expenses of approximately HK$3.27 million as a result of the decrease in staff cost for HY2024/25; and (iii) the increase in finance costs from approximately HK$12.68 million for HY2023/24 to approximately HK$13.44 million for HY2024/25 as a result of the increase in imputed interest of the Existing Convertible Bonds and Other Loan. The coupon rate of the Existing Convertible Bonds has been subsequently reduced to nil under the alteration consent letters entered into between Existing Bondholders and the Company dated 6 November 2024.

32 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Due to the net loss for HY2023/24 and HY2024/25 as discussed above, the Group recorded net cash outflow from operating activities of approximately HK$8.32 million and HK$104.65 million for HY2023/24 and HY2024/25 respectively. The significant increase in cash outflow from operating activities was mainly due to the decrease in revenue.

Consolidated financial position of the Group

| | As at 31 March 2024
HK$'000
(Audited) | As at 30 September 2024
HK$'000
(Unaudited) |
| --- | --- | --- |
| Non-current assets | | |
| Property, plant and equipment | 4 | 1 |
| Right-of-use assets | 59 | 59 |
| | 63 | 60 |
| Current assets | | |
| Trade receivables | 1,279 | 7,318 |
| Other receivables, prepayments and deposits | 30,599 | 25,759 |
| Bank balances and cash | 127 | 144 |
| | 32,005 | 33,221 |
| Total assets | 32,068 | 33,281 |
| Current liabilities | | |
| Trade payables | 12,627 | 18,057 |
| Other payables and accruals | 32,575 | 35,476 |
| Lease liabilities | 2,050 | 1,188 |
| Convertible bonds | 39,729 | 199,547 |
| | 86,981 | 254,268 |
| Non-current liabilities | | |
| Other payables | 3,915 | 3,915 |
| Loans from ultimate holding company | 13,679 | 13,450 |
| Amount due to an ultimate controlling party | 18,863 | 18,951 |
| Lease liabilities | 98 | - |
| Convertible bonds | 148,820 | - |
| | 185,375 | 36,316 |
| Total liabilities | 272,356 | 290,584 |
| Net current liabilities | (54,976) | (221,047) |
| Net liabilities | (240,288) | (257,303) |

Table 2: Summary of the consolidated financial position of the Group

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Non-current assets and current assets

As set out in the above Table 2, the non-current assets and the current assets of the Group remained stable between 31 March 2024 and 30 September 2024. However, the Group had only bank balances and cash of approximately HK$0.14 million as at 30 September 2024.

Non-current liabilities and current liabilities

As set out in the above Table 2, the non-current liabilities of Group decreased from approximately HK$185.38 million as at 31 March 2024 to approximately HK$36.32 million as at 30 September 2024, representing a decrease of approximately HK$149.06 million or 80.4%, while the current liabilities of the Group increased from approximately HK$86.98 million as at 31 March 2024 to approximately HK$254.27 million as at 30 September 2024, representing an increase of approximately HK$167.29 million or 192.3%. The decrease in non-current liabilities of the Group and increase in current liabilities of the Group were mainly due to reclassification of the convertible bonds from non-current liabilities to current liabilities as the Existing Convertible Bonds would originally mature in 2025 as at 30 September 2024. The total amount of the convertible bonds in the consolidated statement of financial position of the Group increased from approximately HK$188.55 million as at 31 March 2024 to approximately HK$199.55 million as at 30 September 2024, which was mainly due to the imputed interest of the Existing Convertible Bonds. After completion of the alteration to terms of the Existing Convertible Bonds under the alteration consent letters entered into between Existing Bondholders and the Company dated 6 November 2024 ("Alteration of Terms"), the maturity date of all of the Existing Convertible Bonds has been extended to 31 December 2027 and the coupon rate has been reduced to nil.

As discussed with the management of the Company, the loans from ultimate holding company and amount due to an ultimate controlling party with the aggregate amount of approximately HK$32.40 million as at 30 September 2024 represent the Shareholder's Loan and Other Loan. As at the Latest Practicable Date, the aggregate amount of the Shareholder's Loan and Other Loan is approximately HK$44.80 million and both the Shareholder's Loan and Other Loan have been reclassified as current liabilities of the Group. The increase in the Shareholder's Loan and Other Loan was primarily due to the additional financial support by Mr. Lam Ching Kui and Wai Chun Investment Fund and the corresponding increase in accrued interest.

34 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(iii) Debt position and going concern issue

The Group had total debts of approximately HK$223.24 million and approximately HK$233.14 million (including loans from ultimate holding company, amount due to an ultimate controlling party, convertible bonds and lease liabilities) as at 31 March 2024 and 30 September 2024 respectively. The net debts (net of cash and cash equivalents) to total assets ratio of the Group is approximately 700.1% as at 30 September 2024, representing an increase of approximately 4.4% as compared with approximately 695.7% as at 31 March 2024.

According to the Annual Report 2023/24, as the Group incurred a loss attributable to owners of the Company of approximately HK$36.53 million for FY2024 and as at 31 March 2024, the Group had net current liabilities and net liabilities of approximately HK$54.98 million and HK$240.29 million respectively, the auditors of the Company have expressed material uncertainty relating to the going concern issue of the Company, which may cast significant doubt on the Group's ability to continue as a going concern. According to the Interim Report 2024/25, the Group incurred a loss attributable to owners of the Company of approximately HK$16.81 million for HY2024/25 and as at 30 September 2024, the Group had net current liabilities of approximately HK$221.05 million and net liabilities of approximately HK$257.30 million respectively. Therefore, the Directors have prepared the consolidated financial statements on a going concern basis based on the assumptions and measures that Mr. Lam Ching Kui, Wai Chun Investment Fund and Wai Chun Holdings Group Limited will not demand the Company for repayment of the loan due to them nor cancel the undrawn loan facilities until all other liabilities of the Group have been satisfied, and will not demand for repayment within twelve months after the date of approval of the consolidated financial statements of the Group for HY2024/25 and the Company will continue to negotiate with potential investors to raise funds and implement measures aiming at improving the working capital and cash flows of the Group including closely monitoring general administrative expenses and operating costs. As confirmed by the management of the Company, as at the Latest Practicable Date, (i) no investor has expressed any interest in debt or equity fundraising of the Company given that the Group was in net current liabilities and net liabilities position as at 30 September 2024; and (ii) other than the Subscription, the Company is not in any negotiation and/or any discussion with any potential investor for fundraising activities or financing arrangement of the Company.

According to the Letter from the Board, Existing Bondholder A has been financing the operations of the Group through the provision of the Shareholder's Loan and Other Loan to the Group. The outstanding principal amount and accrued interest under the Shareholder's Loan and Other Loan payable by the Company to Existing Bondholder A and/or its associates are expected to amount to HK$45,000,000 as at the Completion Date. The Shareholder's Loan and Other Loan bear an interest rate of 6.25% per annum.

35 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We note that (i) the revenue of the Group decreased in HY2024/25 as compared with HY2023/24; (ii) the Group recorded net loss attributable to owners of the Company for FY2023, FY2024 and HY2024/25; (iii) the Group had a low cash level of only approximately HK$0.14 million as at 30 September 2024; (iv) the Group had high net current liabilities of approximately HK$221.05 million as at 30 September 2024; (v) the Group was in a net liabilities position as at 30 September 2024; (vi) the Group had high net debts (net of cash and cash equivalents) to total assets ratio of approximately 700.1% as at 30 September 2024; (vii) the auditors of the Company have expressed material uncertainty relating to the going concern issue of the Company in the Annual Report 2023/24; and (viii) the Shareholder's Loan and Other Loan have a high interest rate of 6.25% per annum. Having considered that (a) the Group may not be able to generate sufficient funding from operating activities to repay the Shareholder's Loan and Other Loan under the financial performance and the financial position of the Group as disclosed above; (b) the outstanding principal amount and accrued interest under the Shareholder's Loan and Other Loan will be fully settled by the issue of the New Convertible Bonds; and (c) the interest rate of the New Convertible Bonds is much less than that of the Shareholder's Loan and Other Loan, we consider that the Subscription can reduce the finance costs of the Group and provide some time for the Group to implement measures to improve the working capital and cash flows of the Group and to seek and arrange for external funding from potential investors.

36 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(III) Reasons for and benefits of the Subscription

(i) Reasons for and benefits of entering into the Subscription Agreement

As stated in the Letter from the Board, the subscription amount payable by Existing Bondholder A under the Subscription Agreement shall be satisfied by way of offsetting the outstanding principal amount and accrued interest under the Shareholder's Loan and Other Loan, payable by the Company to Existing Bondholder A and/or its associates which is expected to amount to HK$45,000,000 as at the Completion Date. Existing Bondholder A had been financing the operations of the Group through the provision of the Shareholder's Loan and Other Loan to the Group. The Shareholder's Loan and the Other Loan were unsecured, carried fixed interest rate at 6.25% per annum and repayable on demand. The Board considers that the Shareholder's Loan which bear interest at 6.25% per annum together with the Other Loan which is also owed to the controlling shareholder, Existing Bondholder A, represents a heavy financial burden to the Group as the Company has a capital deficit of HK$257,303,000 as at 30 September 2024. In view of the above, the Board has reviewed and explored different approaches to settle the Shareholder's Loan and Other Loan (together with the accrued interest). The Company has reached out with banks and financial institutions for external financing, but it was not feasible due to the weak financial performance and the net current liabilities and net liabilities position of the Group as at 31 March 2024 and 30 September 2024. As at the Latest Practicable Date, no bank or financial institution has shown any interest in providing financing to the Company. After the negotiation between the Company and the Existing Bondholder A, Existing Bondholder A did not accept the nil interest rate as proposed by the Company and only agreed to subscribe for the New Convertible Bonds unless the Company accepted his proposal in respect of the Subscription. The Board considered the issue of the New Convertible Bonds to be the most effective and suitable for reducing the amount of interest expense incurred by the Group per annum, enhancing the financial position of the Group and reducing the gearing ratio of the Group and is in the interests of the Shareholders as a whole even though the proposed interest rate of the New Convertible Bonds is higher than that of the Existing Convertible Bonds after considering that (i) the New Convertible Bonds bear a lower interest rate of 2% per annum and will be able to minimize the short-term financial burden to the Group as total interest in three years amounting to approximately HK$5.74 million will be saved; (ii) the net current liabilities of the Group will also be improved as the Shareholder's Loan and Other Loan (together with the accrued interest), which have been included in the current liabilities as at Latest Practicable Date, will be reclassified from current liabilities to non-current liabilities after the Subscription becomes effective; (iii) the financial pressure on the Company for redemption of the New Convertible Bonds at the maturity date would also be lessened because of the redemption discount of 2% at the maturity of the New Convertible Bonds; (iv) the principal amount of the Shareholder's Loan and Other Loan (together with the accrued interest) will be fully settled upon the exercise in full of the conversion rights of the New Convertible Bonds without requiring any cash outflow on the Company; and (v) the issue of the New Convertible Bonds would not have an immediate dilution effect on the shareholding of the Company subject to the minimum public float requirement under the Listing Rules.

37 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We have reviewed the Subscription Agreement, the Annual Report 2023/24 and the Interim Report 2024/25. Based on our analysis of the Group's financial statement as discussed in section headed “(II) Background and financial performance of the Group” above in this letter, the Group recorded loss attributable to the owners of the Company of approximately HK$50.72 million, HK$36.53 million and HK$16.81 million for FY2023, FY2024 and HY2024/25 respectively. As the Shareholder’s Loan and Other Loan bear a higher interest rate of 6.25% per annum as compared with the interest rate of the New Convertible Bonds of 2.00% per annum, the Subscription will reduce the finance costs of the Group, which will in turn improve the financial performance of the Group subject to final audit. Furthermore, the Group has financial difficulties to repay the Shareholder’s Loan and Other Loan, which have a high interest rate of 6.25% per annum, given that the bank balances and cash of the Group as at 30 September 2024 was approximately HK$0.14 million only. As the New Convertible Bonds will be redeemed at 98% of the principal amount at maturity, which will fall on the third anniversary of the date of issue of the New Convertible Bonds, the Subscription will lessen the financial pressure of the Group if the New Convertible Bonds are redeemed upon maturity. After considering the reasons for and benefits of the Subscription as discussed above, we consider that entering into the Subscription is in the interests of the Company and the Shareholder as a whole.

(ii) Fund raising activities of the Company in the past 12 months

As stated in the Letter from the Board, other than the Alteration of Terms, the Company has not raised fund on any issue of equity securities in the past 12 months immediately before the Latest Practicable Date.

38 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(iii) Other financing alternatives

We have discussed with the management of the Company in respect of the consideration of other ways of fund-raising such as debt financing and other equity fund raising method to settle the Shareholder’s Loan and Other Loan. The following set out the summary of our discussion:

(a) Debt financing

The Directors have considered that (i) further debt financing may not be available given the Group’s net current liabilities and net liabilities position as at 30 September 2024; (ii) the cost of debt financing may increase together with additional requirements with asset pledging or guarantees to be provided by the Group; and (iii) further debt financing will increase the financial costs of the Group and using debt financing to replace the Shareholder’s Loan and Other Loan may further weaken the cashflow and financial position of the Group as the interest rate of the new debts may be higher than that of the New Convertible Bonds. Based on our analysis on the financial position of the Group as discussed in the section headed “(II) Background and financial performance of the Group” above and after considering that the Group’s was at net current liabilities and net liabilities position as at 30 September 2024, the proposed interest rate of 2% per annum of the New Convertible Bonds is considered acceptable as (i) other than the Subscriber, no investor has shown any interest in providing debt financing to the Company; (ii) the Existing Convertible Bonds were originally issued under the interest rate of 2% per annum at their issue date, which the interest rate was subsequently reduced to nil together with the reduction in conversion price and redemption amount and extension of maturity date that collectively constitute the Alteration of Terms as a whole; (iii) the Subscription provides an opportunity to the Group to reduce its interest costs, extend the repayment of the Shareholder’s Loan and Other Loan and improve the financial position of the Group; and (iv) the interest rate of the New Convertible Bonds is less than the 12-month Hong Kong Dollar Interest Settlement Rates (i.e., HIBOR) of approximately 2.96% as extracted from the website of Hong Kong Association of Banks (https://www.hkab.org.hk/en/rates/hibor) as at the Latest Practicable Date. Therefore, we concur with the Directors’ view that given the financial position of the Group, obtaining debt financing from financial institutions may not be feasible, and higher interest rates from external new debts as compared with that of the New Convertible Bonds will impose additional financial burden on the Group.

39 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(b) Placing of new shares

The Directors have considered that given the Group’s net current liabilities and net liabilities position as 30 September 2024, the placing agent may face difficulties and take time to seek for potential investor(s) and the potential investor(s) may require a higher placing discount to the trading price of the Shares to fulfill the capital requirement for the Shareholder’s Loan and Other Loan. The Directors also consider that it is higher cost to arrange a placing of new shares, as the placing agent would charge commission with reference to certain percentages of the amount of the fund raising as compared with no commission from the Subscription, and the placing of new shares will cause an immediate dilution to the shareholding of existing Shareholders as compared with that the conversion of the New Convertible Bonds is restricted as further discussed in section headed “(VI) Shareholding structure and possible dilution effect of the New Convertible Bonds” below in this letter. Therefore, rather than conducting placing of new shares to repay the Shareholder’s Loan and Other Loan, we agree with the Directors’ view that entering into the Subscription Agreement is in the interests of the Company and the Shareholders as a whole.

(c) Rights issue or open offer

With regard to the viability of a rights issue or an open offer, the Directors have considered that given the Group’s net current liabilities and net liabilities position as at 30 September 2024, the fund raising from a rights issue or an open offer may be costly and more time consuming. We agree with the Directors’ view that, as compared with the Subscription, (i) more documentation is typically required for the rights issue or an open offer, such as the prospectus; (ii) it is more costly to arrange a rights issue or open offer than the Subscription as it is expected that the Company would incur higher cost to arrange a rights issue or an open offer as more professional parties would need to be engaged in an open offer or a rights issue; and (iii) it generally takes longer time to arrange rights issue or open offer. Furthermore, the Subscription provides a higher degree of certainty, whereas the outcome of a rights issue or open offer for the fundraising amount would be subject to the uncertainty of the subscription level given the net current liabilities and net liabilities position of the Group.

40 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As discussed with the management of the Company, as at the Latest Practicable Date, no investor has expressed any interest in debt or equity fundraising of the Company. Given that the Group was in net current liabilities and net liabilities position as at 30 September 2024 as discussed in the section headed “(II) Background and financial performance of the Group” above in this letter, even if such equity financing and borrowings are available, we consider that it is difficult for the Company to obtain external financing without lengthy negotiations with banks and potential investors and the outcome of such financing methods are highly uncertain as compared with the Subscription. As mentioned above, with reference to the 12-month Hong Kong Dollar Interest Settlement Rates of approximately 2.96% as at the Latest Practicable Date, the financial costs of new debts will be higher than the New Convertible Bonds and additional asset pledging or guarantees may be required. As such, the Subscription will provide more time for the Group to seek for financial resources and to conduct suitable fund raising when the Group’s financial performance and market condition improves in the future. Therefore, after considering the constraints of the debt and equity fundraising alternatives and the financial position of the Group, we consider that the Company has limited fundraising alternatives and we concur with the Directors’ view that the Subscription is more preferable than the above financing alternatives.

(IV) Major terms of the New Convertible Bonds

On 11 April 2025 (after trading hours), the Company entered into the Subscription Agreement with Existing Bondholder A (a connected person of the Company) pursuant to which Existing Bondholder A conditionally agreed to subscribe for and the Company conditionally agreed to issue the New Convertible Bonds in the principal amount of HK$45,000,000. The principal terms of the New Convertible Bonds are set out below:

Issuer:	The Company
Subscriber:	Mr. Lam Ching Kui
Issue price:	100% of the principal amount
Principal amount:	HK$45,000,000
Conversion price:	HK$0.09 per Conversion Share, subject to adjustments
Interest rate:	2% per annum accrued on a daily basis of a 365-day year and payable quarterly in arrears
Redemption at maturity:	98% of the principal amount of the New Convertible Bonds
Form and denomination:	The New Convertible Bonds will be issued in registered form in the denomination of HK$1,000,000 each

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Adjustment events:

If the following events occur, the Conversion Price shall be adjusted:

(a) Consolidation or sub-division of the Shares

Each such adjustment shall be effective from the close of business in Hong Kong on the day immediately preceding the date on which the consolidation or sub-division becomes effective.

(b) Capitalisation of profits or reserves

Each such adjustment shall be effective (if appropriate retroactively) from the commencement of the day following the record date for such issue.

42 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

$$
\frac{\mathrm{A} - \mathrm{B}}{\mathrm{A}}
$$

where:

Provided that (i) if in the opinion of the independent auditors, the use of the fair market value as aforesaid produces a result which is significantly inequitable, such independent auditors may instead determine (and in such event the above formula shall be construed as if B meant) the amount of the said market price which should properly be attributed to the value of the capital distribution or rights; and (ii) the provisions of this paragraph (c) shall not apply in relation to the issue of Shares paid out of profits or reserves and issued in lieu of a cash dividend.

Each such adjustment shall be effective (if appropriate retroactively) from the commencement of the day following the record date for the capital distribution or grant.

43 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(d) Issue of Shares for subscription by way of rights

Such adjustment shall be effective (if appropriate retroactively) from the commencement of the day next following the record date for the offer or grant.

44 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(e) (aa) Issue of convertible or exchangeable securities

45 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(bb) Modification of rights of convertible or exchangeable securities

46 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

For the purposes of this paragraph (e), the “total effective consideration” receivable for the securities issued shall be deemed to be the consideration receivable by the Company for any such securities plus the additional minimum consideration (if any) to be received by the Company upon (and assuming) the conversion or exchange thereof or the exercise of such subscription rights, and the total effective consideration per Share initially receivable for such securities shall be such aggregate consideration divided by the number of Shares to be issued upon (and assuming) such conversion or exchange at the conversion or exchange rate or the exercise of such subscription rights at the subscription price, in each case without any deduction for any commissions, discounts or expenses paid, allowed or incurred in connection with the issue.

(f) Issue of Shares being made wholly for cash at a price less than 90% of the market price per Share

Such adjustment shall become effective on the date of the issue.

47 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Conversion Shares:

Based on the principal amount of the New Convertible Bonds of HK$45,000,000, the New Convertible Bonds is convertible into 500,000,000 Conversion Shares at the initial conversion price of HK$0.09 per New Conversion Share (subject to adjustments).

Conversion period:

The period commencing from the issue date of the New Convertible Bonds up to 4:00 p.m. on the day immediately prior to and exclusive of the maturity date of the New Convertible Bonds.

Conversion rights and restrictions:

The holder of the New Convertible Bonds shall, subject to compliance with the procedures set out in the terms and conditions thereunder, have the right at any time during the conversion period to convert the whole or part of the outstanding principal amount of the New Convertible Bonds registered in its name into the Conversion Shares provided further that (i) any conversion shall be made in amounts of not less than a whole multiple of HK$1,000,000 on each conversion save that if at any time the aggregate outstanding principal amount of the New Convertible Bonds is less than HK$1,000,000, the whole (but not part only) of the outstanding principal amount of the New Convertible Bonds may be converted; and (ii) the exercise of the conversion right attaching to the New Convertible Bonds will not cause the Company to be unable to meet the public float requirement under the Listing Rules.

48 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Early redemption at the option of the Company:

The Company shall be entitled at its sole discretion, by giving not less than fourteen (14) days’ notice to the holders of the New Convertible Bonds, propose to the holders to redeem the outstanding New Convertible Bonds (in multiples of HK$1,000,000 or such lesser amount as may represent the entire principal amount thereof) an amount equivalent to 100% of the principal amount of such outstanding New Convertible Bonds at any time after the date of issue of the New Convertible Bonds up to and including the date falling fourteen (14) days immediately before the maturity date of the New Convertible Bonds.

Ranking of Conversion Shares:

Maturity date:

The date falling on the third anniversary of the date of issue of the New Convertible Bonds.

Voting rights:

The holder of the New Convertible Bonds shall not have any right to attend or vote in any general meeting of the Company.

Transferability:

Subject to compliance with the Listing Rules, the New Convertible Bonds may be transferred or assigned in whole or in part in integral multiples of HK$1,000,000 by holder of the New Convertible Bonds to any party.

Listing:

No application will be made by the Company for the listing of the New Convertible Bonds on the Stock Exchange. Application will be made to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares.

Security:

The obligations of the Company under the New Convertible Bonds are unsecured.

– 49 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Completion of the Subscription Agreement is conditional upon:

(ii) all necessary consents and approvals required to be obtained on the part of the Company in respect of the Subscription Agreement and the transactions contemplated thereunder having been obtained;

The Company shall use its best endeavours to procure the fulfillment of the conditions precedent set out in conditions (i), (ii), (iii) and (iv) above as soon as practicable and in any event on or before the Long Stop Date. Mr. Lam Ching Kui shall use its best endeavours to procure the fulfillment of the condition precedent set out in condition (v) above as soon as practicable and in any event on or before the Long Stop Date.

The conditions precedent set out in conditions (i), (ii) and (iii) above are incapable of being waived. Mr. Lam Ching Kui may at any time by notice in writing to the Company waive the condition set out in condition (iv) above. The Company may at any time by notice in writing to Mr. Lam Ching Kui to waive the condition set out in condition (v) above.

As at the Latest Practicable Date, none of the above conditions have been fulfilled.

50 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(V) Our assessment on the Conversion Price

In assessing the fairness and reasonableness of the Conversion Price, we have primarily taken into account (i) the financial position of the Group, which has been discussed in the section headed “(II) Background and financial performance of the Group” above in this letter; (ii) the historical Share price performance; and (iii) the market comparables in respect of recent issuance of convertible bonds/notes.

As stated in the Letter from the Board, the Conversion Price of HK$0.09 (subject to adjustments) per Conversion Share, which represents a discount to the closing price of the Shares on the Last Trading Day and the average closing price of the Shares on the last five trading days immediately preceding the Last Trading Day, was determined after arm’s length negotiations between the Company and Existing Bondholder A with reference to the recent trading prices of the Shares for approximately one year prior to the Last Trading Day and was agreed after considering that the Company and Existing Bondholder A agreed at a lower interest rate of 2% per annum which would in turn alleviate the future interest burden of the Company. The Conversion Price represents:

(i) a discount of approximately 40.00% to the closing price of HK$0.150 per Share as quoted on the Stock Exchange as at the Latest Practicable Date;

(ii) a discount of approximately 5.26% to the closing price of HK$0.095 per Share as quoted on the Stock Exchange on Last Trading Day;

(iii) a discount of approximately 16.36% over the average closing price of HK$0.1076 per Share as quoted on the Stock Exchange for the last five consecutive trading days immediately preceding the Last Trading Day;

(iv) a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) of approximately 11%, represented by the theoretical diluted price (as defined under Rule 7.27B of the Listing Rules) of approximately HK$0.0961 per Share, to the benchmarked price of HK$0.1076 per Share (as defined under Rule 7.27B of the Listing Rules, taking into account the higher of (a) the closing price of HK$0.0950 per Share on the Last Trading Day and (b) the average closing price of HK$0.1076 per Share as quoted on the Stock Exchange for the five consecutive trading days immediately preceding the Last Trading Day); and

(v) a cumulative theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) in aggregation with the Existing Convertible Bonds represented by a discount of approximately 23%, represented by the cumulative theoretical diluted price of approximately HK$0.1061 per Share to the theoretical benchmarked price of HK$0.1380 per Share in respect of the Alteration of Terms (as defined under Rule 7.27B of the Listing Rules, taking into account the benchmarked price of the Alteration of Terms, being HK$0.1380 per Share).

51 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(i) Review on the historical closing price of the Shares

We have reviewed the chart illustrates the historical daily closing price of the Shares as quoted on the Stock Exchange during the period commencing from 12 April 2024 (being the approximately one year prior to the Last Trading Day) up to and including the Latest Practicable Date (the “Review Period”). We consider that the Review Period is adequate as it represents a reasonable period to reflect a general overview of the recent price movement of the Shares. The following chart sets out the daily closing prices of the Shares on the Stock Exchange during the Review Period:

Chart 1: Historical Share price performance of the Company during the Review Period

Source: website of the Stock Exchange (www.hkex.com.hk)

As shown in the above Chart 1, during the Review Period, the daily closing prices of the Shares ranged from the lowest of HK$0.080 per Share, to the highest of HK$0.260 per Share with an average closing price of HK$0.128 per Share. The Conversion Price of HK$0.090 per Share is within the said price range of the Shares.

52 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Although the Conversion Price of HK$0.090 per Conversion Share is below the average closing price of the Shares during the Review Period, after considering that (i) the financial position of the Group as discussed in the section headed “(II) Background and financial performance of the Group” above in this letter; (ii) it would be difficult to determine the outcome and the pricing of alternative equity financing methods, such as placing, rights issue or open offer; (iii) a similar or higher discount to the closing price, as compared with that of the Conversion Price, may be required to attract potential investors or existing Shareholders to subscribe for the Shares; (iv) alternative equity financing methods may be relatively time-consuming; and (v) the Conversion Price is within the range in the comparable analysis as discussed in the sub-section headed “Comparison with recent issuance of convertible bonds/notes” below, we are of the view that the Conversion Price is fair and reasonable.

(ii) Comparison with recent issuance of convertible bonds/notes

To further assess the fairness and reasonableness of the Conversion Price, we have attempted to conduct the research on the website of the Stock Exchange in respect of issue, placing and subscription of convertible bonds/notes exercises (excluding A-share convertible bonds) with the following criteria: (i) the issuers are listed on the Stock Exchange, of which the shares were not in prolonged suspension at the date of the announcement; (ii) the market capitalisation of the issuers on the respective last trading day is not more than HK$300 million; (iii) the issuers announced to issue or appoint a placing agent to place the convertible bonds/notes during the last six-month immediately preceding the date of the Subscription Agreement (the “Comparable Period”), excluding those for the acquisition transactions, corporate restructuring and takeover of the listed company; (iv) the duration of the convertible bonds/notes is at least one year and is not perpetual; and (v) the proposed issue of the convertible bonds/notes has not been terminated or lapsed as at the Latest Practicable Date. We have excluded perpetual convertible bonds/notes in our analysis as they are considered not comparable to the New Convertible Bonds in terms of the credit risk and interest rate risk incurred from the maturity of the convertible bonds/notes. Based on the above criteria, we identified an exhaustive list of 11 convertible securities (the “Comparable Transactions”). We consider that the Comparable Transactions were determined under similar market conditions and sentiment, and hence represent fair and representative samples and provide a general reference of this type of transaction in the market. We also consider that the Comparable Period is appropriate (i) to reflect the prevailing market conditions and sentiments in the Hong Kong stock market; (ii) to provide a general reference of the recent convertible securities transactions being conducted under similar market conditions; and (iii) to generate a reasonable and meaningful number of samples for the purpose of our analysis. Set out below is the Comparable Transactions analysis:

53 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Date of announcement	Stock code	Name of company	Market capitalisation on the respective last trading day (HK$ million)	Net assets position on the date of the announcement (Yes/No)	Connected transaction (Yes/No)	Duration (years)	Interest rate per annum	Premium/(discount) of conversion price over/(to) the closing price on the respective date of relevant agreement	Premium/(discount) of conversion price over/(to) the average closing price for the last five consecutive trading days immediately preceding the date of the relevant agreement	Completed as at the Latest Practicable Date (Yes/No)
2 April 2025	764	Eternity Investment Limited	206.26	Yes	No	2.0	5.0%	3.33%	nil	Yes
13 March 2025	8613	Oriental Payment Group Holdings Limited	256.39	Yes	No	1.0	7.0%	(13.53)%	(12.61)%	No
6 March 2025	276	Mongolia Energy Corporation Limited	97.83	No	Yes	3.0	3.0%	25.00%	22.20%	Yes
13 January 2025	1220	Zhidao International (Holdings) Limited	178.20	Yes	No	1.0	nil	22.20%	0.40%	No
27 December 2024	515	China Silver Technology Holdings Limited	48.73	Yes	No	3.0	8.0%	132.56% (Note 1)	140.38% (Note 1)	Yes
23 December 2024	764	Eternity Investment Limited	282.65	Yes	No	2.0	5.0%	4.59%	3.75%	Yes
20 December 2024	8360	Basic House New Life Group Limited	216.16	No	No	2.0 (Note 2)	6.0%	nil	4.20%	Yes
3 December 2024	6918	Kidetech Holdings Limited	95.56	Yes	No	2.0	12.0%	4.58%	4.58%	Yes
2 December 2024	1142	E&P Global Holdings Limited	46.41	No	No	5.0	nil	(21.88)%	(24.92)%	Yes
15 October 2024	8613	Oriental Payment Group Holdings Limited	227.77	Yes	No	1.0	7.0%	16.67%	27.97%	Yes
2 October 2024	274	Renaissance Asia Silk Road Group Limited	102.52	Yes	No	2.0	6.0%	25.00%	3.29%	Yes
					Maximum:	5.0	12.0%	25.00%	27.97%
					Minimum:	1.0	nil	(21.88)%	(24.92)%
					Average:	2.2	5.4%	6.60%	2.89%
11 April 2025	1013	The Company	25.40	No	Yes	3.0	2.0%	(5.26)%	(16.36)%	No

Source: website of the Stock Exchange (www.hkex.com.hk)

Notes:

As the premium of the conversion price of the convertible bonds/notes of China Silver Technology Holdings Limited is extremely higher than the other Comparable Transactions, we have excluded China Silver Technology Holdings Limited from our analysis of the conversion price as outlier.
The maturity of the convertible bonds/notes of Basic House New Life Group Limited could be extended by the parties in writing. Since such convertible bonds/notes have not been extended as at the Latest Practicable Date, the duration in the above table is based on the original maturity date in our analysis.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(a) Conversion price

We note that (i) the premium/(discount) of the conversion price over/to the closing price on the respective date of relevant agreement of the Comparable Transactions (after excluding the outlier) ranged from a discount of approximately 21.88% to a premium of approximately 25.00%, with the average being premium of 6.60%; and (ii) the premium/(discount) of the conversion price over/to the average closing price for the last five consecutive trading days immediately preceding the date of relevant agreement of the Comparable Transactions (after excluding the outlier) ranged from a discount of approximately 24.92% to a premium of approximately 27.97%, with the average being premium of 2.89%. The discount of the Conversion Price is within the range of the Comparable Transactions.

As set out in the above table, among the Comparable Transactions, the conversion price of the convertible notes/bonds of Oriental Payment Group Holdings Limited ("Oriental Payment") as announced on 13 March 2025 (as supplemented by the side letters dated 14 March 2025) and E&P Global Holdings Limited ("E&P Global") as announced on 2 December 2024 represented a discount to the closing price on the respective date of relevant agreement and the average closing price for the last five consecutive trading days immediately preceding the date of relevant agreement. As compared with the New Convertible Bonds, the discount of the Conversion Price is less than the discount of the conversion price of the convertible notes/bonds of Oriental Payment and E&P Global to the closing price on the respective date of relevant agreement and the redemption of the New Convertible Bonds at maturity is more favourable than the convertible notes/bonds of Oriental Payment and E&P Global, which would be redeemed at 100% and 115% of the principal amount at maturity, respectively, in contrast to 98% redemption of the New Convertible Bonds.

In terms of the financial position, E&P Global, Basic House New Life Group Limited ("Basic House New Life") and Mongolia Energy Corporation Limited ("Mongolia Energy") were in net liabilities position on the date of the relevant announcement of the issue of the convertible notes/bonds.

We consider that E&P Global was in a similar situation as the Company after reviewing the announcement of E&P Global dated 2 December 2024, which included that (i) E&P Global was in net liabilities and net current liabilities position as at 30 September 2024; (ii) the auditors of E&P Global highlighted the material uncertainty related to the going concern of E&P Global; (iii) the cash position of E&P Global, which was approximately HK$5.76 million as at 30 September 2024, was as low as the Group; and (iv) E&P Global had high reliance on the financial resources from shareholders, directors and related parties and had limited ability to procure external funding. As discussed above, the terms of the New Convertible Bonds are more favourable than that of convertible notes of E&P Global in terms of the discount of the conversion price and the redemption at maturity.

55 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In the case of Basic House New Life, which was also in net liabilities position, while the conversion price of the convertible bonds of Basic House New Life represents a nil discount to the closing price on the respective date of relevant agreement, the interest rate of such convertible bonds was 6% per annum, which is higher than the interest rate of the New Convertible Bonds of 2% per annum. In addition, the convertible bonds of Basic House New Life would be redeemed at 100% of the principal amount at maturity while the New Convertible Bonds would be redeemed at 98% of principal amount at maturity.

Despite the fact that the conversion price of the convertible bonds of Mongolia Energy is premium over both the closing price on the respective date of relevant agreement and the average closing price for the last five consecutive trading days immediately preceding the date of relevant agreement, the interest rate of the convertible bonds of Mongolia Energy is higher than that of the New Convertible Bonds and the convertible bonds of Mongolia Energy would be redeemed at 100% of the principal amount at maturity while the New Convertible Bonds would be redeemed at 98% of principal amount at maturity. In respect of the financial condition of Mongolia Energy, Mongolia Energy was in net liabilities position as at 30 September 2024 and recorded loss attributable to the owners of the company for the six months ended 30 September 2024, but Mongolia Energy recorded profit attributable to the owners of the company for the year ended 31 March 2024. The cash level of Mongolia Energy, which was approximately HK$75.46 million as at 30 September 2024, was higher than the cash level of Group of only approximately HK$0.14 million as at 30 September 2024.

Although the discount of the Conversion Price is below the average of the Comparable Transactions, after carefully considering that (i) the Group was at net current liabilities position and net liabilities position as at 30 September 2024; (ii) the Group would not have sufficient cash and financial resources to repay the Shareholder's Loan and Other Loan given the low cash level of the Group; (iii) the Group has difficulty to obtain external financing and, even if such financing is available, a similar or higher discount to the closing price may be required and the outcome is uncertain; (iv) the interest rate of the New Convertible Bonds is lower than that of the Shareholder's Loan and Other Loan; (v) the terms of the New Convertible Bonds are more favourable than the convertible notes/bonds of E&P Global, Basic House New Life and Mongolia Energy, which were also in net liabilities position, in terms of the conversion price, interest rate and redemption as discussed above; and (vi) the conversion of the New Convertible Bonds is subject to the public float requirement and no mandatory general offer being triggered under Rule 26 of the Takeovers Code on Existing Bondholders, which will be further discussed in the section headed "(VI) Shareholding structure and possible dilution effect of the New Convertible Bonds" below in this letter, we consider that the Subscription is fair and reasonable and is in the interest of the Company and Shareholders as a whole.

56 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(b) Duration

As shown in the table above, the duration of the Comparable Transactions ranged from 1 year to 5 years with an average duration of 2.2 years. The duration of the New Convertible Bonds is within the range and higher than the average of the Comparable Transactions.

As shown in the table above, the interest rates of the Comparable Transactions ranged from nil to 12.0% per annum, with an average of approximately 5.4% per annum. The interest rate of the New Convertible Bonds is within the range and lower than the average of the Comparable Transactions. As such, the interest rate of the New Convertible Bonds is more favourable to the Company.

Shareholders should note that the financial position, business, operations, and prospects of listed companies of the Comparable Transactions may not be identical to those of the Group and we have not conducted any in-depth investigation into the respective businesses and operations of the companies of each Comparable Transactions. Therefore, we consider that the Comparable Transactions provide the Independent Shareholders a general reference as to the common market practice in respect of the terms of convertible bonds/notes issued by companies listed in Hong Kong as compared with that of the New Convertible Bonds. It would not be appropriate to conclude the Subscription solely based on the result of Comparable Transactions analysis. Therefore, we advise the Independent Shareholders taking a holistic approach to consider various factors as discussed in this letter to justify the fairness and reasonableness of the Subscription.

57 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(VI) Shareholding structure and possible dilution effect of the New Convertible Bonds

Set out below is the shareholding structure of the Company (i) as at the Latest Practicable Date; (ii) immediately after full conversion of all the Existing Convertible Bonds only (assuming there being no other issue or repurchase of the Shares); (iii) immediately after full conversion of the New Convertible Bonds only (assuming there being no other issue or repurchase of the Shares); and (iv) immediately after full conversion of the Existing Convertible Bonds and the New Convertible Bonds (assuming there being no other issue or repurchase of the Shares):

Name of Shareholder	(i) as at the Latest Practicable Date		(ii) immediately after full conversion of all the Existing Convertible Bonds only		(iii) immediately after full conversion of the New Convertible Bonds only		(iv) immediately after full conversion of the Existing Convertible Bonds and the New Convertible Bonds
	Number of Shares	Approximate %	Number of Shares	Approximate %	Number of Shares	Approximate %	Number of Shares	Approximate %
Existing Bondholder A (Note 1)	4,810,125	1.80	1,759,610,125	71.84	504,810,125	65.78	2,259,610,125	76.62
Existing Bondholder B (Note 2)	194,292,325	72.66	621,292,325	25.37	194,292,325	25.32	621,292,325	21.07
	199,102,450	74.46	2,380,902,450	97.21	699,102,450	91.10	2,880,902,450	97.68
Other public Shareholders	68,287,081	25.54	68,287,081	2.79	68,287,081	8.09	68,287,081	2.32
Total	267,389,531	100.00	2,449,189,531	100.00	767,389,531	100.00	2,949,189,531	100.00

Notes:

Mr. Lam Ching Kui, being Existing Bondholder A and the ultimate controlling shareholder of the Company, directly holds 4,810,125 Shares.
Ka Chun, being Existing Bondholder B, is a company owned as to 100% by Wai Chun Investment Fund, which is wholly-owned by Existing Bondholder A, Mr. Lam Ching Kui, and holds 194,292,325 Shares.
Certain percentage figures included in the above tables have been subject to rounding adjustments. Accordingly, figures shown as totals may not be an arithmetic aggregation of the figures preceding them.
Pursuant to the terms and conditions of the Existing Convertible Bonds and the New Convertible Bonds, the bondholders shall not exercise the conversion rights attached or attaching to the Existing Convertible Bonds and the New Convertible Bonds if, as a result of such exercise, it will cause the public float of the Company to fall below the percentage prescribed under the Listing Rules, and any conversion shall also be subject to no mandatory general offer being triggered under Rule 26 of the Takeovers Code on the bondholder.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As stated in the Letter from the Board, upon fully conversion of the New Convertible Bonds at the Conversion Price of HK$0.09 per Conversion Share, a maximum of 500,000,000 Conversion Shares will be allotted and issued, which represents:

(i) approximately 186.99% of the issued share capital of the Company as at the Latest Practicable Date; and

(ii) approximately 65.16% of the issued share capital of the Company as enlarged by the allotment and issue of the 500,000,000 Conversion Shares assuming that there is no other change to the total number of the issued Shares from the Latest Practicable Date to the date when the New Convertible Bonds are converted in full.

For indicative purposes only, assuming that there is no change in the number of the issued Shares from the Latest Practicable Date up to the date when the conversion rights attaching to Existing Convertible Bonds and New Convertible Bonds are exercised in full, the shareholding of the Independent Shareholders will be diluted from approximately 25.54% to approximately 8.09% immediately after full conversion of the New Convertible Bonds only and from approximately 25.54% to approximately 2.32% immediately after full conversion of the Existing Convertible Bonds and the New Convertible Bonds.

However, according to the terms of the Existing Convertible Bonds and New Convertible Bonds, Existing Bondholders may only convert such number of Existing Convertible Bonds and New Convertible Bonds as would not cause the Company not to comply with the minimum public float requirement under the Listing Rules following the conversion of the Existing Convertible Bonds and New Convertible Bonds and the conversion rights attached to the Existing Convertible Bonds and New Convertible Bonds shall only be exercised on the condition that any conversion of Existing Convertible Bonds and New Convertible Bonds does not trigger a mandatory general offer obligation on Existing Bondholders under Rule 26 of the Takeovers Code.

We have discussed with the management of the Company and the management of the Company has confirmed that Existing Bondholders may not be able to convert the Existing Convertible Bonds and New Convertible Bonds in full in view of the restriction on conversion if the Company encounters insufficient public float. As such, either Existing Bondholder A or Existing Bondholder B may theoretically convert up to approximately 5,758,000 Conversion Shares (equivalent to the Existing Convertible Bonds of approximately HK$575,800 based on the conversion price of the Existing Convertible Bonds of HK$0.10 per conversion share or the New Convertible Bonds of approximately HK$518,220 based on the Conversion Price of HK$0.09 per Conversion Share) to comply with the minimum public float requirement under the Listing Rules, which will dilute the shareholding of the Independent Shareholders from approximately 25.54% to approximately 25.00%. Therefore, the immediate dilution effect to the shareholding of the Independent Shareholders is limited and restricted.

In view of (i) the reasons for and benefits of the Subscription as set out in the section headed “(III) Reasons for and benefits of the Subscription” in this letter above; and (ii) the restriction to the conversion of the New Convertible Bonds as discussed above, we consider that the level of dilution (subject to the restriction in respect of the minimum public float requirement of the Listing Rules) to the shareholding interests of the Independent Shareholders is acceptable.

59 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(VII) Financial effects as a result of the Subscription

The financial effects of the Subscription set out below are purely for illustrative purposes only and do not reflect the future financial position of the Company or the Group.

(i) Net assets value and gearing

It is expected that the Subscription will not have an immediate material impact on the net asset value and gearing of the Group. However, the net current liabilities of the Group will be improved as the amount of the Shareholder’s Loan and Other Loan (together with the accrued interest), which have been included in the current liabilities as at the Latest Practicable Date, will be reclassified from current liabilities to non-current liabilities after the Subscription becomes effective.

(ii) Earnings

On initial recognition, the New Convertible Bonds shall be recognised as a compound financial instrument with a conversion option, which comprise an equity component and a liability component, on the consolidated financial statements of the Company. The carrying amount of the liability component is first determined by measuring the fair value of a similar liability that does not have an associated equity component. The carrying amount of the equity component is then determined by deducting the fair value of the liability component from the fair value of the New Convertible Bonds as a whole. The liability component of the New Convertible Bonds is subsequent measured at amortised cost, using the effective interest method. The related interest expense is recognised in profit or loss.

As the interest rate of the New Convertible Bonds is lower than that of the Shareholder’s Loan and Other Loan, it is expected that the Subscription will reduce the financial pressure of the Group by reducing the interest rate.

Based on the above, we consider that the Subscription is in the interests of the Company and the Shareholders as a whole.

RECOMMENDATION

We note that the Conversion Price is below the average of the closing price of the Shares during the Review Period and the discount of the Conversion Price is below the average of the conversion price of the Comparable Transactions. Nevertheless, having taken into account the principal factors and reasons as discussed above, in particular:

(i) the financial position of the Group, including the material uncertainty relating to going concern of the Group raised by the auditors of the Company as stated in the Annual Report 2023/24;

(ii) the Group does not have sufficient cash to repay the Shareholder’s Loan and Other Loan;

(iii) the Subscription will improve the net current liabilities position of the Group;

60 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(iv) there are limited debt and equity financing alternatives available to the Group and the outcome is highly uncertain;

(v) the New Convertible Bonds have a lower interest rate than that of the Shareholder's Loan and Other Loan;

(vi) the Conversion Price is within the range of the Comparable Transactions; and

(vii) the immediate dilution to the Independent Shareholders is limited due to the restriction in respect of the minimum public float requirement of the Listing Rules,

we are of the view that, although the Subscription Agreement and the transactions contemplated thereunder are not in the ordinary and usual course of business of the Group, the Subscription (including the grant of the Specific Mandate) is conducted on normal commercial terms and is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Accordingly, we would recommend the Independent Shareholders and the Independent Board Committee to advise the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the SGM for approving the terms of the Subscription Agreement and the transactions contemplated thereunder (including the grant of the Specific Mandate).

Yours faithfully,

For and on behalf of

INCU Corporate Finance Limited

Gina Leung

Mayaging Director

Psyche So

Associate Director

Ms. Gina Leung is a licensed person registered with the SFC and a responsible officer of INCU Corporate Finance Limited to carry out Type 6 (advising on corporate finance) regulated activity under the SFO. She has over 20 years of experience in the corporate finance industry and has participated in the provision of independent financial advisory services for various transactions involving companies listed in Hong Kong.

Ms. Psyche So is a licensed person registered with the SFC and a responsible officer of INCU Corporate Finance Limited to carry out Type 6 (advising on corporate finance) regulated activity under the SFO. She has over eight years of experience in the corporate finance industry and has participated in the provision of independent financial advisory services for various transactions involving companies listed in Hong Kong.

61 -

APPENDIX

STATUTORY AND GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERESTS

(a) Interests of Directors and chief executive

As at the Latest Practicable Date, none of the Directors or chief executive of the Company had any interests or short positions in the Shares, underlying shares and debentures of the Company or any of its associated corporation(s) (within the meaning of Part XV of the SFO) (i) which were required to notify to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they were taken or deemed to have under such provisions of the SFO); or (ii) which were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) which were required, pursuant to the Model Code for Securities Transactions by Directors adopted by the Company (the "Model Code"), to be notified to the Company and the Stock Exchange.

(b) Interests of substantial shareholders and other persons

As at the Latest Practicable Date, so far as was known to the Directors, the following persons (other than the Directors and the chief executive of the Company) had, or were deemed to have, interests or short positions in the Shares or underlying Shares of the Company (i) which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO; or (ii) which were recorded in the register required to be kept by the Company under Section 336 of the SFO:

Name of Shareholders	Capacity/nature of interest	Number of Shares/ underlying shares held	Approximate percentage of shareholdings
Lam Ching Kui	Beneficial owner	1,759,610,125 (L) (Note 2)	658.07%
	Interest of controlled corporation	621,292,325 (L) (Note 1)	232.35%
Wai Chun Investment Fund	Interest of controlled corporation	621,292,325 (L) (Note 1)	232.35%

APPENDIX STATUTORY AND GENERAL INFORMATION

Name of Shareholders	Capacity/nature of interest	Number of Shares/ underlying shares held	Approximate percentage of shareholdings
Ka Chun	Beneficial owner	621,292,325 (L)
(Note 1)	232.35%

The Letter "L" denotes the long position in the Shares.

Notes:

427,000,000 Shares refer to the Conversion Shares which may fall to be allotted and issued pursuant to the Existing Third Convertible Bonds, the remaining 194,292,325 Shares refer to the Shares held by Ka Chun as at the Latest Practicable Date, which is wholly-owned by Wai Chun Investment Fund and in turn wholly-owned by Mr. Lam Ching Kui.
1,754,800,000 Shares refer to the Conversion Shares which may fall to be allotted and issued pursuant to the Existing Convertible Bonds, the remaining 4,810,125 Shares refers to the Shares held by Mr. Lam Ching Kui as beneficial owner as at the Latest Practicable Date.
The approximate percentages of shareholding are calculated based on 267,389,531 Shares issued as at the Latest Practicable Date.

Save as disclosed above, so far as was known to the Directors, as at the Latest Practicable Date, no person had, or were deemed to have, an interest or short position in the Shares or underlying Shares of the Company (i) which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO; or (ii) which were recorded in the register required to be kept by the Company under Section 336 of the SFO, or was a substantial shareholder of the Company.

None of the Director is also a director or employee of any substantial shareholder of the Company.

3. DIRECTORS' SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contracts with any member of the Group which does not expire or is not terminable by the relevant member of the Group within one year without payment of compensation, other than statutory compensation.

4. DIRECTORS' INTEREST IN ASSETS, CONTRACTS AND OTHER INTERESTS

(a) Director's interests in contracts

As at the Latest Practicable Date, there was no contract or arrangement entered into by any member of the Group subsisting at the date of this circular in which any Director is materially interested and which is significant to the business of the Group.

APPENDIX STATUTORY AND GENERAL INFORMATION

(b) Director's interests in assets

As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any assets which had been acquired, disposed of by or leased to, or which were proposed to be acquired, disposed of by or leased to, any member of the Group since 31 March 2024, being the date to which the latest published audited consolidated financial statements of the Group were made up.

(c) Competing business

As at the Latest Practicable Date, none of Directors and their respective associates were interested in businesses which compete or are likely to compete, either directly or indirectly, with the businesses of the Group (as would be required to be disclosed under the Listing Rules as if each of them was a controlling shareholder).

5. EXPERT'S QUALIFICATION AND CONSENT

The following is the qualification of the expert who has given opinion or advice, which is contained or referred to in this circular:

Name	Qualification
INCU Corporate Finance Limited	A corporation licensed to carry out Type 6 (advising on corporate finance) regulated activity under the SFO

As at the Latest Practicable Date, the above expert:

(i) had no direct or indirect shareholdings in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group; and

(ii) had no interests, direct or indirect, in any assets which had been, since 31 March 2024, being the date to which the latest published audited consolidated financial statements of the Company were made up, acquired or disposed of by or leased to any of member of the Group, or are proposed to be acquired or disposed of by or leased to any of member of the Group.

The above expert has given and has not withdrawn its written consent to the issue of this circular with the inclusion therein of its letter, report or opinion (as the case may be) and reference to its name in the form and context in which they respectively appear.

APPENDIX

STATUTORY AND GENERAL INFORMATION

6. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, save as to the loss attributable to owners of the Company of approximately HK$17,307,000 for the six months ended 30 September 2024 and the increase in the capital deficiency of the Company from approximately HK$240,288,000 as at 31 March 2024 to HK$257,303,000 as at 30 September 2024 which were disclosed in the interim results announcement of the Company dated 18 November 2024, there was no material adverse change in the financial or trading position of the Group since 31 March 2024, being the date of which the latest published audited financial statements of the Group were made up.

7. GENERAL

This circular has been printed in English and Chinese; in the event of inconsistency, the English version shall prevail.

8. DOCUMENTS ON DISPLAY

The following documents will be available on (i) the website of the Company (www.1013.hk) and (ii) the website of the Stock Exchange (www.hkex.com.hk) during the period of 14 days from the date of this circular:

(i) the letter from the Board, the text of which is set out in “Letter from the Board” in this circular;

(ii) the letter from the Independent Board Committee to the Independent Shareholders, the text of which is set out in “Letter from the Independent Board Committee” in this circular;

(iii) the letter from IFA to the Independent Board Committee and the Independent Shareholders, the text of which is set out in “Letter from the Independent Financial Adviser” in this circular;

(iv) the written consent referred to in the paragraph headed “5. Expert’s qualification and consent” in this appendix;

(v) the Subscription Agreement in relation to the subscription for the New Convertible Bonds; and

(vi) this circular.

NOTICE OF SGM

偉俊集團控股有限公司*

Wai Chun Group Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock code: 1013)

NOTICE IS HEREBY GIVEN THAT a special general meeting (the "Meeting") of Wai Chun Group Holdings Limited (the "Company") will be held at Rooms 4001-02, 40/F., China Resources Building, 26 Harbour Road, Wanchai, Hong Kong on Friday, 20 June 2025 at 3:30 p.m. to consider and, if thought fit, pass (with or without modification) the following resolution as ordinary resolution:

ORDINARY RESOLUTION

"THAT:

(a) the subscription agreement dated 11 April 2025 (the "Subscription Agreement") and entered into between the Company and Mr. Lam Ching Kui in respect of the issue of convertible bonds in an aggregate principal amount of HK$45,000,000 (the "New Convertible Bonds") upon and subject to the terms and conditions as set out therein and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified;

(b) the issue of the New Convertible Bonds by the Company in accordance with the terms and conditions of the Subscription Agreement be and is hereby approved;

(c) the allotment and issue of new ordinary shares of HK$0.01 each in the share capital of the Company (the "Conversion Shares") which may fall to be allotted and issued upon the exercise of the conversion rights attaching to the New Convertible Bonds in accordance with the terms and conditions thereof be and are hereby approved;

(d) conditional upon, among others, the listing committee of The Stock Exchange of Hong Kong Limited granting the listing of, and permission to deal in, the Conversion Shares, the specific mandate to the directors of the Company (the "Directors") to exercise the powers of the Company for the allotment and issue of the Conversion Shares in accordance with the terms and conditions of the New Convertible Bonds be and is hereby approved; and

For identification purposes only

66 -

NOTICE OF SGM

(e) any one or more Directors be and are hereby authorised to do all such things and acts as he/she/they may in his/her/their discretion consider necessary, desirable or expedient, for the purposes of or in connection with the implementation of the Subscription Agreement and the transactions contemplated thereunder, including but not limited to the execution of all such documents under seal where applicable, as he/she/they considers necessary or expedient in his/her/their opinion to implement and/or give effect to the issue of the New Convertible Bonds and the allotment and issue of the Conversion Shares which may fall to be allotted and issued upon exercise of the conversion rights attaching to the New Convertible Bonds."

On behalf of the Board
Wai Chun Group Holdings Limited
Lam Ka Chun
Chairman and Chief Executive Officer

Hong Kong, 2 June 2025

Registered office:
Clarendon House
2 Church Street
Hamilton HM11
Bermuda

Head office and Principal Place of Business
in Hong Kong:
Rooms 4001–02, 40/F.
China Resources Building
26 Harbour Road, Wanchai
Hong Kong

Notes:

A member entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and on a poll vote instead of him. A proxy need not be a member of the Company.
In order to be valid, a form of proxy and the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power of authority, must be deposited at the Company's branch Share Registrar, Union Registrars Limited at Suites 3301–04, 33/F., Two Chinachem Exchange Square, 338 King’s Road, North Point, Hong Kong, not less than 48 hours before the time fixed for holding the Meeting or any adjourned meeting thereof. Completion and return of the form of proxy will not preclude any member from attending and voting in person at the Meeting or any adjourned meeting thereof should he so wishes.
In case of joint shareholdings, the vote of the senior joint shareholder who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the votes of the other joint shareholder(s) and for this purposes seniority will be determined by the order in which the names stand in the register of members of the Company in respect of the joint shareholding.
67 -

NOTICE OF SGM

The register of members of the Company will be closed from Tuesday, 17 June 2025 to Friday, 20 June 2025 (both days inclusive), during which period no transfer of shares of the Company will be registered. In order to qualify for attending and voting at the Meeting (or any adjournment thereof), all transfers of shares of the Company accompanied by the relevant share certificates(s) must be lodged with the Company's branch share registrar in Hong Kong at the above address by no later than 4:00 p.m. on 16 June 2025.
In case a Typhoon Signal No. 8 (or above) or a Black Rainstorm Warning Signal is hoisted but lowered before noon on 20 June 2025, the Meeting will be held as scheduled at 3:30 p.m. on the same day at the same venue; or a Typhoon Signal No. 8 (or above) or a Black Rainstorm Warning Signal is hoisted or remains hoisted any time after noon on 20 June 2025, the Meeting will be adjourned to another date to be announced by the Company.
As at the date of this notice, the Board consists of one executive Director, namely Mr. Lam Ka Chun (Chairman and Chief Executive Officer) and two independent non-executive Directors, namely Mr. Wan Bo and Mr. Wong Po Keung.
68 -

AI assistant

Baoye Group Company Limited — Proxy Solicitation & Information Statement 2025

50544_rns_2025-06-01_dca439f0-f3fe-4601-8e4c-582c7166b838.pdf

偉俊集團控股有限公司

(I) CONNECTED TRANSACTION: PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE; AND (II) NOTICE OF SPECIAL GENERAL MEETING

DEFINITIONS

偉俊集團控股有限公司*

PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

The Subscription Agreement

Date

Party

Subscription of New Convertible Bonds

Conditions precedent to the Subscription Agreement

Principal terms and conditions of the New Convertible Bonds

(b) Capitalisation of profits or reserves

(c) Capital distribution

Conversion Shares

Conversion Price

Completion

Minimum public float requirement

Effects on shareholding structure of the Company

Dilution and financial effects of the issue of the New Convertible Bonds

Equity fund raising activities of the Company in the past 12 months

Mandate to issue the Conversion Shares

USE OF PROCEEDS FROM PROPOSED ISSUE OF NEW CONVERTIBLE BONDS

OTHER FUND-RAISING METHOD

REASONS FOR AND BENEFITS OF ENTERING INTO THE SUBSCRIPTION AGREEMENT

LISTING RULES IMPLICATIONS

THE INDEPENDENT BOARD COMMITTEE

SPECIAL GENERAL MEETING

PROXY ARRANGEMENT

CLOSURE OF REGISTER OF MEMBERS

RECOMMENDATION

VOTE BY POLL

ADDITIONAL INFORMATION

偉俊集團控股有限公司

CONNECTED TRANSACTION: PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

CONNECTED TRANSACTION IN RELATION TO PROPOSED ISSUE OF CONVERTIBLE BONDS UNDER SPECIFIC MANDATE

INTRODUCTION

INDEPENDENT BOARD COMMITTEE

BASIS OF OUR OPINION

PRINCIPAL FACTORS AND REASONS CONSIDERED

(I) Background of the Subscription

(II) Background and financial performance of the Group

(i) Background of the Group

(ii) Financial performance of the Group

FY2023 vs FY2024

HY2023/24 vs HY2024/25

Non-current assets and current assets

Non-current liabilities and current liabilities

(b) Placing of new shares

(c) Rights issue or open offer

(IV) Major terms of the New Convertible Bonds

(V) Our assessment on the Conversion Price

(VII) Financial effects as a result of the Subscription

(i) Net assets value and gearing

(ii) Earnings

RECOMMENDATION

1. RESPONSIBILITY STATEMENT

2. DISCLOSURE OF INTERESTS

(a) Interests of Directors and chief executive

(b) Interests of substantial shareholders and other persons

3. DIRECTORS' SERVICE CONTRACTS

4. DIRECTORS' INTEREST IN ASSETS, CONTRACTS AND OTHER INTERESTS

(a) Director's interests in contracts

(b) Director's interests in assets

(c) Competing business

5. EXPERT'S QUALIFICATION AND CONSENT

6. MATERIAL ADVERSE CHANGE

7. GENERAL

8. DOCUMENTS ON DISPLAY

偉俊集團控股有限公司*

ORDINARY RESOLUTION

"THAT:

More from Baoye Group Company Limited

Baoye Group Company Limited Proxy Solicitation & Information Statement 2025