eprint Group Limited - Proxy Solicitation & Information Statement 2016

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 a 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 eprint Group Limited (the “ Company ”), you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or 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.

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eprint GROUP LIMITED eprint 集團有限公司 (Incorporated in the Cayman Islands with limited liability)

(Stock code: 1884)

CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EXTRAORDINARY GENERAL MEETING

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

A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on pages 25-26 of this circular. A letter of advice from Messis Capital to the Independent Board Committee and the Independent Shareholders is set out on pages 27 to 51 of this circular.

A notice convening an extraordinary general meeting of the Company (the “ EGM ”) to be convened at élan 120, 3rd Floor, L’Hotel élan, 38 Chong Yip Street, Kwun Tong, Kowloon, Hong Kong on Wednesday, 24 February 2016 at 11:00 a.m. is set out on pages EGM-1 to EGM-4 of this circular. A form of proxy for use at the EGM is enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited, Level 22, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time of the meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

1 February 2016

			Page
Definitions....................................................................................................................			1
Letter from	the	Board..................................................................................................	6
Letter from	the	Independent Board Committee........................................................	25
Letter from	the	Independent Financial Adviser........................................................	27
Appendix	–	General Information....................................................................	52
Notice of Extraordinary General Meeting..................................................................			EGM-1

– i –

DEFINITIONS

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

“2015 Master Supply Agreement” the agreement entered into between the Company, Wilson Printing and Wilson (HK) on 14 December 2015, pursuant to which the Sellers agreed to supply the Products and to provide the Services for production and operation of the Printing Business
“2015 Tenancy Agreements”

the tenancy agreements entered into between the respective landlords (whom are connected persons) and certain subsidiaries of the Company on 14 December 2015 for the leasing of certain properties, details as set out in the section headed “2015 Tenancy Agreements” in this circular

“2016 Printing Services Agreement”

the agreement entered into between Promise Network and Runxing on 14 December 2015, pursuant to which Runxing agreed to provide the Printing Services

“Announcement”

the announcement of the Company dated 14 December 2015 relating to the Continuing Connected Transactions

“Articles”

the articles of association of the Company

“associates”

has the meaning as defined under the Listing Rules

“Board”

the board of Directors

“Company”

eprint Group Limited, a company incorporated in the Cayman Islands, whose shares are listed on the Stock Exchange

“Concerted Shareholders” collectively, Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung, pursuant to a deed of confirmation dated 2 July 2013 and entered into by them confirming the existence of their acting concert arrangement, each of them has agreed to jointly control their respective interests in the Company held through eprint Limited
“Continuing Connected Transactions”
collectively, the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement

– 1 –

DEFINITIONS

“CTP” CTP Limited, a company incorporated in Hong Kong with limited liability and is owned as to 25% by Mr. She, 25% by Mr. Chong, 25% by Mr. Lam and 25% by Mr. WM Leung, and therefore is a connected person of the Company
“Directors”

the directors of the Company

“e-banner” e-banner Limited, a company incorporated in Hong Kong with limited liability and is a 51% owned subsidiary of the Company
“EGM” an extraordinary general meeting of the Company to be convened and held to approve, among others, the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement, together with their respective proposed annual caps and the transactions to be contemplated thereunder
“eprint Limited” eprint Limited, the controlling Shareholder holding 313,125,000 Shares, representing approximately 56.93% of the issued share capital of the Company as at the Latest Practicable Date
“Group” the Company and its subsidiaries
“Hong Kong”

the Hong Kong Special Administrative Region of the PRC

“Independent Board Committee”
a committee of the Board comprising all the independent non-executive Directors, namely Mr. Chi Man Shing Stephen, Dr. Lung Cheuk Wah and Ms. Luk Mei Yan
“Independent Financial Adviser” or “Messis Capital”
Messis Capital Limited, a licensed corporation under the SFO permitted to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities for the purpose of the SFO, being the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders in respect of the Continuing Connected Transactions
“Independent Shareholders”
any Shareholder other than the Concerted Shareholders and their associates
“Independent Third Party(ies)” person(s) and/or company(ies) who/which is (are) independent of the Company and its connected persons (as defined under the Listing Rules)

– 2 –

DEFINITIONS

“Interested Directors” being Mr. She, Mr. Chong, Mr. Lam and Mr. WM Leung
“Invoice Limited” Invoice Limited, a company incorporated in Hong Kong with limited liability and is a wholly-owned subsidiary of the Company
“King Profit” King Profit International Limited, a company incorporated in Hong Kong with limited liability and is beneficially owned as to approximately 70% by VVV and 30% by Mr. Yip Chi Man, and therefore is a connected person of the Company
“Latest Practicable Date” 26 January 2016, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Lucky Gainer” Lucky Gainer Limited, a company incorporated in Hong Kong with limited liability and is a wholly-owned subsidiary of the Company
“Master Supply Agreement”
the agreement entered into between the Company, Wilson Printing and Wilson (HK) on or about 27 September 2013, pursuant to which the Sellers agreed to supply the Products and to provide the Services for production and operation of the Printing Business
“Mr. Chong” Mr. Chong Cheuk Ki, a non-executive Director and holds 21.62% interest in eprint Limited
“Mr. Lam”
Mr. Lam Shing Kai, a non-executive Director and holds 21.62% interest in eprint Limited
“Mr. Lam ST”
Mr. Lam Shing Tai, the brother of Mr. Lam, and therefore is a connected person of the Company
“Mr. WM Leung”
Mr. Leung Wai Ming, a non-executive Director and holds 21.62% interest in eprint Limited
“Mr. YP Leung” Mr. Leung Yat Pang, a former Director resigned on 28 May 2015 and holds 13.52% interest in eprint Limited

– 3 –

DEFINITIONS

“Mr. She” Mr. She Siu Kee William, an executive Director and Chairman of the Company, and holds 21.62% interest in eprint Limited
“PRC” the People’s Republic of China, excluding Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan for the purpose of this circular
“Printing Business” the printing business of the Group
“Printing Services” the printing services provided by Runxing to the Group including printing of the Printing Products
“Printing Services Agreement” the agreement entered into between Promise Network and Runxing on 1 April 2015 as supplemented by a supplemental agreement dated 1 November 2015, pursuant to which Runxing agreed to provide the Printing Services to Promise Network for a term of one year commenced from 1 April 2015
“Printing Products” bound books, paper bags, kraft paper bags, paper folders, plastic folders, promotion leaflets, promotional fan, menus, envelopes, brown envelopes, spot colour envelopes, NCR (carbonless copy paper) and UV (ultraviolet) cards etc.
“Products” the ink products, zine printing plates, printing solutions, consumables of printing machines and printing machine spare parts to be provided by the Sellers
“Profit More”
Profit More Rich Limited, a company incorporated in Hong Kong with limited liability and is wholly owned by CTP, and therefore is a connected person of the Company
“Promise Network” Promise Network Printing Limited, a company incorporated in Hong Kong with limited liability and is a wholly-owned subsidiary of the Company
“Promise Properties” Promise Properties Limited, a company incorporated in Hong Kong with limited liability and is beneficially owned as to approximately 21.62% by Mr. She, 21.62% by Mr. Chong, 21.62% by Mr. Lam, 13.52% by Mr. YP Leung, 10.81% by Ms. Chau Fung Kiu, the spouse of Mr. WM Leung and 10.81% by an Independent Third Party, and therefore is a connected person of the Company

– 4 –

DEFINITIONS

“Prospectus” the prospectus of the Company dated 20 November 2013 “Runxing” 東莞市潤興呈品印刷有限公司 ( D o n g g u a n R u n x i n g Chengpin Printing Company Limited*), a company established in the PRC “SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “Sellers” collectively, Wilson Printing and Wilson (HK) “Services” the provision of printing machine maintenance services by the Sellers “Share(s)” ordinary share(s) of HK$0.01 each in the share capital of the Company “Shareholder(s)” holder(s) of Share(s) “Stock Exchange” The Stock Exchange of Hong Kong Limited “VVV” VVV Limited, a company incorporated in Hong Kong with limited liability and is beneficially owned as to approximately 21.62% by Mr. She, 21.62% by Mr. Chong, 21.62% by Mr. Lam, 21.62% by Mr. WM Leung and 13.52% by Mr. YP Leung, respectively, and therefore is a connected person of the Company “Wilson (HK)” Wilson (Hong Kong) Limited, a company incorporated in Hong Kong with limited liability and is wholly-owned by Mr. Lam ST, and therefore is a connected person of the Company “Wilson Printing” Wilson Printing Equipment Limited, a company incorporated in Hong Kong with limited liability and is wholly-owned by Mr. Lam ST, and therefore is a connected person the Company

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

“%” per cent.

for identification purpose only

– 5 –

LETTER FROM THE BOARD

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eprint GROUP LIMITED eprint 集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 1884)

Executive Directors: Registered Office: Mr. She Siu Kee William (Chairman) 4th Floor, Harbour Place Mr. Fung Hong Keung 103 South Church Street George Town, PO Box 10240 Non-executive Directors: Grand Cayman KY1-1002 Mr. Chong Cheuk Ki Cayman Islands Mr. Lam Shing Kai Mr. Leung Wai Ming Head Office and Principal Place of Mr. Deng Xiaen Business in Hong Kong: Flat A3, 1/F., Phase 3 Independent Non-Executive Directors: Kwun Tong Industrial Centre Dr. Lung Cheuk Wah Kwun Tong Mr. Chi Man Shing Stephen Hong Kong Ms. Luk Mei Yan

1 February 2016

To the Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

Reference is made to the Announcement in respect of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement.

The purpose of this circular is to provide you with, among other things, (i) further information in relation to the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement; (ii) a letter of recommendation from the Independent Board Committee to the Independent Shareholders; (iii) a letter of advice from Messis Capital to the Independent Board Committee and the Independent Shareholders in relation to the Continuing Connected Transactions; and (iv) a notice of the EGM to consider and, if thought fit, to approve the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps.

– 6 –

LETTER FROM THE BOARD

CONTINUING CONNECTED TRANSACTIONS

2015 TENANCY AGREEMENTS

Background

(a) Tenancy agreements relating to CTP

Sixteen tenancy agreements signed in July 2013 were entered into between CTP, as landlord, and Lucky Gainer and Invoice Limited, as tenants, under which CTP agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer and Invoice Limited, with a total saleable area of approximately 23,000 square feet, for a term of 33 months ending on 31 March 2016 for use as offices, workshops, stores and car parks.

(b) Tenancy agreements relating to Promise Properties

Five tenancy agreements signed in July 2013 were entered into between Promise Properties, as landlord, and Lucky Gainer and Invoice Limited, as tenants, under which Promise Properties agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer and Invoice Limited with a total saleable area of approximately 8,300 square feet, for a term of 33 months ending on 31 March 2016 for use as workshops.

(c) Tenancy agreements relating to VVV

Six tenancy agreements signed in July 2013 were entered into between VVV, as landlord, and Lucky Gainer, as tenant, under which VVV agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer for use as workshops and a car park and one property in Chai Wan to Promise Network for use as a store, with a total saleable area of approximately 12,000 square feet, for a term of 33 months ending on 31 March 2016.

(d) Tenancy agreement relating to Profit More

A tenancy agreement signed in July 2013 was entered into between Profit More, as landlord, and Lucky Gainer, as tenant, under which Profit More agreed to lease a property located in Kwun Tong Industrial Centre to Lucky Gainer with a saleable area of approximately 2,900 square feet, for a term of 33 months ending on 31 March 2016 for use as a workshop.

(e) Tenancy agreement relating to King Profit

A tenancy agreement signed in July 2013 was entered into between King Profit, as landlord, and Invoice Limited, as tenant, under which King Profit agreed to lease a property and a car park located in Kwun Tong Industrial Centre to Invoice Limited with a saleable area of approximately 1,800 square feet, for a term of 33 months ending on 31 March 2016 for use as a workshop and car park.

– 7 –

LETTER FROM THE BOARD

2015 Tenancy Agreements

Date

14 December 2015

Subject matter:

(a) 2015 tenancy agreements relating to CTP

Nineteen tenancy agreements entered into between CTP, as landlord, and Lucky Gainer, Promise Network and e-banner as tenants, under which CTP agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer, Promise Network and e-banner Limited, with a total saleable area of 29,217 square feet for use as offices, workshops, stores and car parks. The monthly rentals payable to CTP for the three years ending 31 March 2019 are approximately HK$607,800, HK$668,600 and HK$734,000 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the relevant tenant).

Location of property	Tenant	Saleable Area
		(sq.ft.)
Unit W1 on 2nd Floor of Block 2,	Lucky Gainer	1,440
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit R4 on 6th Floor of Block 4,	Lucky Gainer	1,235
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit B4 on Ground Floor of Block 4,	Lucky Gainer	1,965
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit A3 on 1st of Block 3,	Lucky Gainer	1,822
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit N4 on 6th of Block 4,	Lucky Gainer	1,640
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

– 8 –

LETTER FROM THE BOARD

Location of property	Tenant	Saleable Area
		(sq.ft.)
Unit P4 on 6th of Block 4,	Lucky Gainer	1,285
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit K2 on 2nd of Block 2,	Lucky Gainer	1,084
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit B3 on 3rd of Block 3,	Lucky Gainer	1,500
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit W2 on 2nd Floor of Block 2,	Lucky Gainer	1,200
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit R4 on 2nd of Block 4,	Lucky Gainer	1,865
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit L2 on 2nd Floor of Block 2,	Lucky Gainer	1,355
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit M4 on 6th of Block 4,	Lucky Gainer	1,300
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit N3, W1, W2, W3, W4 and	Lucky Gainer	3,315
W5 on 2nd of Block 3,
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit W6 on 3rd of Block 1,	Lucky Gainer	742
Nos. 472-484 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

– 9 –

LETTER FROM THE BOARD

Location of property	Tenant	Saleable Area
		(sq.ft.)
Car Parking Space No. 142 on Basement,	Promise Network	N/A
Nos. 436-484 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit A4 on Ground Floor of Block 4,	Lucky Gainer	1,824
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit B3 on 4/F of Block 3,	Lucky Gainer	1,500
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit L on 8/F of Block 4,	e-banner	1,650
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit A on 5/F of Block 4,	e-banner	2,495
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

– 10 –

LETTER FROM THE BOARD

(b) 2015 tenancy agreements relating to Promise Properties

Five tenancy agreements entered into between Promise Properties, as landlord, and Lucky Gainer, as tenant, under which Promise Properties agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer with a total saleable area of 8,280 square feet for use as workshops. The monthly rentals payable to Promise Properties for the three years ending 31 March 2019 are approximately HK$137,800, HK$151,400 and HK$167,300 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

Location of property	Tenant	Saleable Area
		(sq.ft.)
Unit A4 on 6th of Block 4,	Lucky Gainer	2,495
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit P4 on 2nd of Block 4,	Lucky Gainer	1,275
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit K3 on 3rd of Block 3,	Lucky Gainer	1,930
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit W3 on 2nd of Block 2,	Lucky Gainer	1,200
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit H3 on 4/F of Block 3,	Lucky Gainer	1,380
Nos. 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

– 11 –

LETTER FROM THE BOARD

(c) 2015 tenancy agreements relating to VVV

Six tenancy agreements entered into between VVV, as landlord, Lucky Gainer and Promise Network, as tenants, under which VVV agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer for use as workshops and a car park and one property in Chai Wan to Promise Network for use as a store, with a total saleable area of 11,865 square feet. The monthly rentals payable to VVV for the three years ending 31 March 2019 are approximately HK$233,600, HK$258,100 and HK$285,200 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the relevant tenant).

Location of property	Tenant	Saleable Area
		(sq.ft.)
Car Parking Space No. 78 on G/F,	Promise Network	N/A
Nos. 436-484 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit H2 on 2nd Floor of Block 2,	Lucky Gainer	1,655
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit K4 on 3rd of Block 4,	Lucky Gainer	6,616
Nos. 436-446 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit G2 on 2nd Floor of Block 2,	Lucky Gainer	1,355
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Unit J2 on 2nd Floor of Block 2,	Lucky Gainer	1,860
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon
Portion of Workshop No. 1	Promise Network	379
on Ground Floor, Trend Centre,
No. 29 Cheung Lee Street, Hong Kong

– 12 –

LETTER FROM THE BOARD

(d) 2015 tenancy agreement relating to Profit More

A tenancy agreement entered into between Profit More, as landlord, and Lucky Gainer, as tenant, under which Profit More agreed to lease a property located in Kwun Tong Industrial Centre to Lucky Gainer with a saleable area of 2,895 square feet for use as a workshop. The monthly rentals payable to Profit More for the three years ending 31 March 2019 are approximately HK$50,000, HK$55,000 and HK$60,000 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

Location of property	Tenant	Saleable Area
		(sq.ft.)
Workshop Nos. M201, M202 and	Lucky Gainer	2,895
M210 on 3rd Floor of Block 2,
Nos. 460-470 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

(e) 2015 tenancy agreement relating to King Profit

A tenancy agreement entered into between King Profit, as landlord, and Lucky Gainer and Promise Network, as tenants, under which King Profit agreed to lease a property and a car park located in Kwun Tong Industrial Centre to the tenants with a total saleable area of 1,820 square feet for use as a workshop and car park. The monthly rentals payable to King Profit for the three years ending 31 March 2019 are approximately HK$33,000, HK$36,600 and HK$40,500 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

Location of property	Tenant	Saleable Area
		(sq.ft.)
Unit A3 (including flat roof appurtenant	Lucky Gainer/	1,820
thereto) on 4/F of Block 3 and	Promise
Car Parking Space No. 36 on Basement,	Network
Nos. 436-484 and 448-458 Kwun Tong Road,
Kwun Tong Industrial Centre, Kowloon

(collectively, the “ 2015 Tenancy Agreements ”).

Term

The term of the 2015 Tenancy Agreements shall commence on and from 1 April 2016 and expire on 31 March 2019 (both days inclusive).

– 13 –

LETTER FROM THE BOARD

Rental

Pursuant to the 2015 Tenancy Agreements, the rental are determined based on the prevailing market rental of the respective properties and with reference to the valuation conducted by an independent qualified valuer.

Proposed Annual Caps

The annual caps for the aggregate rentals payable by the Group to CTP, Promise Properties, VVV, Profit More and King Profit pursuant to the Tenancy Agreements for the financial years ended 31 March 2014 and 31 March 2015, and for the financial year ending 31 March 2016 are HK$8,670,000, HK$9,153,000 and HK$9,650,000 respectively. The actual aggregate rental paid by the Group under the Tenancy Agreements for the financial years ended 31 March 2014 and 31 March 2015 amounted to HK$6,598,325 and HK$8,851,000 respectively and for the eight months ended 30 November 2015 amounted to HK$7,568,307.

The Directors estimate that the aggregate annual rentals payable by the Group to CTP, Promise Properties, VVV, Profit More and King Profit under the 2015 Tenancy Agreements for the three years ending 31 March 2019 will not exceed the annual caps of HK$12,746,400, HK$14,036,400 and HK$15,444,000 respectively. The increase in the annual caps under the 2015 Tenancy Agreements are due to the increase in market rental over the past three years and the increase in the rental area from 48,000 square feet under the Tenancy Agreements to 54,077 square feet under the 2015 Tenancy Agreements.

In arriving at the proposed annual caps in respect of the 2015 Tenancy Agreements, the Directors have taken into account, among others, the market rent, the rental area and the then market conditions.

Conditions

The 2015 Tenancy Agreements is conditional upon the resolution regarding the 2015 Tenancy Agreements (including the annual caps) and the transactions contemplated thereunder being approved by the Independent Shareholders at the EGM.

2015 MASTER SUPPLY AGREEMENT

Background

On or about 27 September 2013, Wilson Printing and Wilson (HK), all of which are controlled by Mr. Lam ST, and the Company entered into the Master Supply Agreement for a term of three years ending on 31 March 2016, pursuant to which Wilson Printing and Wilson (HK) agreed to supply the Products and to provide the Services in respect of the printing machines to the Group. The purchase price payable by the Group to Wilson Printing and Wilson (HK) will be agreed following arm’s length negotiations between the relevant parties with reference to the prevailing market price of the similar products and services in Hong Kong.

– 14 –

LETTER FROM THE BOARD

2015 Master Supply Agreement

Date

14 December 2015

Parties

the Company
Wilson Printing
Wilson (HK)

Wilson Printing and Wilson (HK) collectively as “Sellers”.

Supply service

Pursuant to the 2015 Master Supply Agreement, the Sellers agreed to sell the Products and to provide the Services to the Group for production and operation of the Printing Business.

Term

The term of the 2015 Master Supply Agreement shall commence on and from 1 April 2016 and expiring on 31 March 2019 (both days inclusive). Pursuant to the 2015 Master Supply Agreement, either party may terminate the 2015 Master Supply Agreement at any time by giving six months’ prior written notice of termination to the other.

Pricing

Pursuant to the 2015 Master Supply Agreement, the price of the Products and the Services shall be based on:

(i) the latest selling price of similar products from other Independent Third Party or service fees as quoted by other independent service providers; or
(ii) the prices agreed between the Group and the Sellers from time to time after arm’s length negotiation and are comparable to market prices of similar products and services as set out in (i) above.

– 15 –

LETTER FROM THE BOARD

The Company and the Sellers agreed that the transactions to be contemplated under the 2015 Master Supply Agreement shall be conducted on normal commercial terms, in particular:

(a) on terms no less favourable to the Group than terms available to or from (as appropriate) Independent Third Parties;
(b) in the ordinary and usual course of business of the Group and conducted after arm’s length negotiations; and
(c) will not exceed the annual caps.

Proposed Annual Caps

The annual caps for the supply of the Products and the provision of the Services by the Sellers to the Group pursuant to the Master Supply Agreement for the financial years ended 31 March 2014 and 31 March 2015, and for the financial year ending 31 March 2016 are HK$26,800,000, HK$27,500,000 and HK$28,200,000 respectively. The actual transaction amount under the Master Supply Agreement for the financial years ended 31 March 2014 and 31 March 2015 amounted to HK$26,269,551 and HK$26,202,655 respectively and for the eight months ended 30 November 2015 amounted to HK$14,079,794.

The Directors estimate that the annual transaction amounts under the 2015 Master Supply Agreement for the three years ending 31 March 2019 will not exceed the annual caps of HK$20,485,000, HK$20,338,000 and HK$20,204,000 respectively.

The annual transaction amounts for the supply of the Products and the Services by the Sellers for the three years ending 31 March 2009 are determined after having considered, among others, (i) the historical amount of the purchase of the Products and the Services required, and (ii) the estimated future printing volume of the Printing Business given that certain part of the Printing Business would be out sourced to Runxing pursuant to the Printing Services Agreement and the 2016 Printing Services Agreement.

Conditions

The 2015 Master Supply Agreement is conditional upon the resolution regarding the 2015 Master Supply Agreement (including the annual caps) and the transactions contemplated thereunder being approved by the Independent Shareholders at the EGM.

PRINTING SERVICES AGREEMENT

Background

Promise Network has entered into the Printing Services Agreement with Runxing, pursuant to which Runxing agreed to provide the Printing Services to Promise Network for a term of one year commenced from 1 April 2015 to 31 March 2016.

– 16 –

LETTER FROM THE BOARD

As at the Latest Practicable Date, Runxing and its ultimate beneficial owners are Independent Third Parties.

The Company was informed by Mr. Lam ST that he has entered into an agreement to acquire the entire interest of Runxing. Completion of the acquisition is expected to take place in early February 2016. Upon completion of the acquisition, Runxing shall be wholly-owned by Mr. Lam ST and therefore become a connected person of the Company, hence the transaction contemplated under the Printing Services Agreement shall constitute continuing connected transaction of the Company under Chapter 14A of the Listing Rules.

Pursuant to the Printing Services Agreement, the estimated transaction amount for the Printing Services for the period from 1 January 2016 to 31 March 2016 shall be HK$16,714,000.

In addition, Promise Network and Runxing have entered into the 2016 Printing Services Agreement for the provision of the Printing Services by Runxing to Promise Network for another term of three years ending on 31 March 2019. Subject to the completion of the acquisition by Mr. Lam ST of the entire interest of Runxing, the 2016 Printing Services Agreement shall also constitute continuing connected transaction of the Company under Chapter 14A of the Listing Rules.

Printing Services

Pursuant to the Printing Services Agreement and the 2016 Printing Services Agreement, Runxing agreed to provide the Printing Services to Promise Network.

Term

The term of the Printing Services Agreement is one year commenced from 1 April 2015 and expiring on 31 March 2016.

The term of the 2016 Printing Services Agreement is three years commencing from 1 April 2016 and expiring on 31 March 2019.

Conditions

The 2016 Printing Services Agreement is conditional upon:–

the resolution regarding the 2016 Printing Services Agreement (including the annual caps) and the transactions contemplated thereunder being approved by the Independent Shareholders at the EGM; and
the completion of the acquisition of the entire issued capital of Runxing by Mr. Lam ST.

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LETTER FROM THE BOARD

Pricing

Pursuant to the Printing Services Agreement and the 2016 Printing Services Agreement, the price payable for Printing Services provided by Runxing shall be the price at a discount of ranging from 20% to 35% of the selling price of the Printing Products to be sold by Promise Network.

Proposed annual caps

Having considered, among others,

(i) the historical demand of the Printing Products from customers for the three years ended 31 March 2015 and the six months ended 30 September 2015;
(ii) the expected growth of order level of the Printing Products; and
(iii) the increase in outsource rate of the Printing Products to Runxing.

Given that the Group’s printing utilization almost reach it maximum capacity. The Group has since October 2014 outsourced certain printing works of the Printing Products to Runxing. The selection of the type of Printing Products outsourced to Runxing depends on, among others, the time required by the customers. The Group usually outsource those Printing Products with comparatively longer delivery schedule. Having the cooperation with Runxing for more than a year, the Directors considered that the printing quality and efficiency of Runxing can meet the Group’s needs. In this connection, the Directors considered to increase the outsouce rate of certain Printing Products to Runxing, which can increase the order level of the Printing Products without further capital investment on new printing machines.

Based on the above, the Directors estimate that (a) the production fee under the Printing Services Agreement for the three months ending 31 March 2016 will not exceed HK$16,714,000; and (b) the annual production fee under the 2016 Printing Services Agreement for the three years ending 31 March 2019 will not exceed the annual caps of HK$132,648,000, HK$145,913,000 and HK$160,504,000 respectively.

The production fee under the Printing Services Agreement and the 2016 Printing Services Agreement represent a significant amount as compared to the revenue recorded by the Group. In order to avoid any business disruption on heavy reliance on a single service provider, the Group has sourced three other independent service providers which can provide the printing services of the Printing Products to the Group if and when necessary. In addition, the Group is also able to expand its production capacity to meet the needs of the printing of the Printing Products if necessary.

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LETTER FROM THE BOARD

REASONS FOR THE 2015 TENANCY AGREEMENTS, 2015 MASTER SUPPLY AGREEMENT, PRINTING SERVICES AGREEMENT AND 2016 PRINTING SERVICES AGREEMENT

2015 Tenancy Agreements

CTP, Promise Properties, VVV, Profit More and King Profit are the landlords of certain properties which are leased to the Group. As certain subsidiaries of the Group have been using the properties historically, the Directors consider that it would be commercially beneficial to the Group if the production plants and offices are located in the same industrial building or in close proximity to each other, and therefore the Board (including the Independent Board Committee after taking into account the advice of the Independent Financial Adviser, but excluding the Interested Directors who are interested in the 2015 Tenancy Agreements) is of the view that it is in the interest of the Group for saving time and cost to enter into the 2015 Tenancy Agreements.

2015 Master Supply Agreement

The Group has established a long term relationship with Wilson Printing and Wilson (HK) which provide ink products, zinc printing plates, printing solutions, consumables of printing machines and spare parts to the Group regularly. Ink products, zinc printing plates and printing solutions are the principal raw materials to the Group’s business.

Wilson Printing and Wilson (HK) have been consistently supplying the Group with quality ink products, zinc printing plates and printing solutions in a timely fashion.

The Group purchased printing machines from the Sellers which can meet the Printing Business needs, and therefore required the supply of consumables of printing machines (i.e. zinc printing plates), spare parts compatible with the printing machines and maintenance services from the Sellers of those printing machines so as not to cause any disruption to the Printing Business. Using incompatible consumable will increase mechanical wear and tear.

The Group has been using customized color for printing. The ink products supplied by the Sellers can meet the Group’s standard of color.

In addition, the procurement department of the Group also obtained quotations from three other Independent Third Party suppliers for similar products and services on a regular basis to determine if the price and terms offered by the Sellers are comparable to or no less favourable than price and terms offered by Independent Third Party suppliers. After obtaining quotations, the Group assessed by reference to, among other things, the quality of printing machines consumables, the quality of services, experience, credit terms and ability to meet the Group’s requirements and standards so as to determine the party with whom the Group will purchase the relevant products and services from. The price and terms provided by the Sellers are more favourable to the Group than price and terms offered by other Independent Third Party suppliers.

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LETTER FROM THE BOARD

Given the aforesaid and after taking into account the terms of the 2015 Master Supply Agreement, the Board (including the Independent Board Committee after taking into account the advice of the Independent Financial Adviser, but excluding the Interested Directors who are being the Concerted Shareholders and are deemed to be interested in the 2015 Master Supply Agreement) considers that entering into the 2015 Master Supply Agreement is in the interests of the Company and the Shareholders as a whole, and the terms thereof are on normal commercial terms and are fair and reasonable.

Printing Services Agreement and the 2016 Printing Services Agreement

Runxing is principally engaged in printing of different kinds of products.

Given that the Group’s printing utilization almost reach its maximum capacity. In order to effectively utilizing its printing resources, reducing its investment amount of machinery in paper printing segment and controlling its production costs, the Group has since October 2014 outsourced certain printing works to Runxing.

Runxing adopted the similar printing workflow and standard as Runxing is using the similar printing machines as the Group. Besides, the Group is allowed to second staff stationing at Runxing to monitor and control the work flow and follow up on the delivery of the Printing Products.

In addition, the procurement department of the Group also obtained quotations from three Independent Third Party service providers for similar printing services provided to determine if the price and terms offered by Runxing are comparable to or no less favourable than price and terms offered by Independent Third Party service providers. After obtaining quotations, the Group assessed by reference to, among other things, the quality of services, experience, credit terms and ability to meet the Group’s requirements and standards so as to determine the party with whom the Group will purchase the relevant services from. The quality of the Printing Products as well as price and terms provided by Runxing are more favourable to the Group than other Independent Third Party service providers.

Given the aforesaid and after taking into account the terms of the Printing Services Agreement and the 2016 Printing Services Agreement, the Board (including the Independent Board Committee after taking into account the advice of the Independent Financial Adviser, but excluding the Interested Directors who are being the Concerted Shareholders and are deemed to be interested in the Printing Services Agreement and the 2016 Printing Services Agreement) considers that entering into the Printing Services Agreement and the 2016 Printing Services Agreement is in the interests of the Company and the Shareholders as a whole, and the terms thereof are on normal commercial terms and are fair and reasonable.

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LETTER FROM THE BOARD

GENERAL

The Group is principally engaged in the provision of printing services and solutions on advertisement, bound books and stationeries, to a diversified customer base in Hong Kong, including provision of one-stop internet printing service, from provision of design tools and software of customized products to various kinds of printing and processing services, to meet the diverse needs of customers.

CTP is principally engaged in the business of property investment, and is beneficially owned as to 25% by Mr. She, 25% by Mr. Chong, 25% by Mr. Lam and 25% by Mr. WM Leung, respectively.

Promise Properties is principally engaged in the business of property investment, and is beneficially owned as to approximately 21.62% by Mr. She, 21.62% by Mr. Chong, 21.62% by Mr. Lam, 13.52% by Mr. YP Leung, 10.81% by Ms. Chau Fung Kiu, the wife of Mr. WM Leung and 10.81% by an independent third party.

VVV is principally engaged in the business of property investment, and is beneficially owned as to approximately 21.62% by Mr. She, 21.62% by Mr. Chong, 21.62% by Mr. Lam, 21.62% by Mr. WM Leung and 13.52% by Mr. YP Leung, respectively.

Profit More is principally engaged in the business of property investment, and is wholly owned by CTP.

King Profit is principally engaged in the business of property investment, and is beneficially owned as to approximately 70% by VVV and 30% by Mr. Yip Chi Man.

Wilson Printing is principally engaged in the business of trading of printing equipment and printing materials, and is wholly and beneficially owned by Mr. Lam ST.

Wilson (HK) is principally engaged in the business of trading of printing machineries and spare parts, and is beneficially owned as to 65% by Mr. Lam ST.

Accordingly, each of CTP, Promise Properties, VVV, Profit More, King Profit, Wilson Printing and Wilson (HK) are associates of Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung, and hence they are considered as connected persons of the Group under Chapter 14A of the Listing Rules.

Runxing is currently owned by Independent Third Party. Upon completion of the acquisition of the entire interest in Runxing shall become a connected person of the Group under Chapter 14A of the Listing Rules.

As Mr. She, Mr. Lam, Mr. Leung YP and Mr. Chong, Directors of the Company, being the Concerted Shareholders, have material interests in the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement, they have abstained from voting on the Board

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LETTER FROM THE BOARD

resolutions approving the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the transactions contemplated thereunder.

The transactions contemplated under the respective 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules. As the proposed annual caps in respect of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement and the 2016 Printing Services Agreement for each of the three years ending 31 March 2019 is more than HK$10,000,000, and the proposed cap in respect of the Printing Services Agreement for the three months ending 31 March 2016 is more than HK$10,000,000 and the applicable ratios calculated thereof are more than 5%, the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the respective proposed annual caps are subject to the reporting, announcement, annual review and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

THE INDEPENDENT BOARD COMMITTEE AND THE INDEPENDENT FINANCIAL ADVISER

The Independent Board Committee comprising all independent non-executive Directors, namely Dr. Lung Cheuk Wah, Mr. Chi Man Shing Stephen and Ms. Luk Mei Yan, has been established to advise the Independent Shareholders, in respect of (i) the 2015 Tenancy Agreements and the proposed annual caps; (ii) the transactions under the 2015 Master Supply Agreement and the proposed annual caps; (iii) the transactions under the Printing Services Agreement and the proposed caps; and (iv) the transactions under the 2016 Printing Services Agreement and the proposed annual caps.

No member of the Independent Board Committee has any material interest in the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the respective proposed annual caps. A letter from the Independent Board Committee is set out on pages 25 to 26 of this circular.

Messis Capital has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders regarding (i) the 2015 Tenancy Agreements and the proposed annual caps; (ii) the transactions under the 2015 Master Supply Agreement and the proposed annual caps; (iii) the transactions under the Printing Services Agreement and the proposed caps; and (iv) the transactions under the 2016 Printing Services Agreement and the proposed annual caps. A letter from the Independent Financial Adviser is set out on pages 27 to 51 of this circular.

EGM

Set out on pages EGM-1 to EGM-4 of this circular is a notice convening the EGM to consider and, if appropriate, to approve the ordinary resolutions relating to the Continuing Connected Transactions.

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LETTER FROM THE BOARD

A form of proxy for use at the EGM is enclosed herewith. Whether or not you intend to attend and/or vote at the EGM in person, you are requested to complete the form of proxy and return it to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited, Level 22, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time of the EGM or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of shareholders at a general meeting must be taken by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. As such, all the resolutions set out in the notice of the EGM will be voted by poll.

According to Rule 2.15 of the Listing Rules, any shareholder that has a material interest in the transaction or arrangement shall abstain from voting on the resolution(s) approving the transaction or arrangement at the general meeting. As at the Latest Practicable Date, 550,000,000 Shares were in issue, among which, 313,125,000 Shares (representing approximately 56.93% of the issued Shares) were held by eprint Limited, which is held as to 21.62%, 21.62%, 21.62%, 21.62% and 13.52% by Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung. Pursuant to Rule 2.16 of the Listing Rules, eprint Limited is deemed to have a material interest in the transactions under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement for being a close associate to the parties to the said agreements. Mr. Chong is also interested in 1,592,000 Shares held by his spouse, Ms. Yip Fei, representing approximately 0.29% of the issued Shares of the Company. Therefore, eprint Limited and Ms. Yip Fei shall all abstain from voting in favour of the resolutions to approve the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps at the EGM.

RECOMMENDATION

Your attention is drawn to the letter of advice from the Independent Financial Adviser as set out on pages 27 to 51 of this circular which contains its advice to the Independent Board Committee and the Independent Shareholders in connection with the transactions under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps and the letter from the Independent Board Committee set out on pages 25 to 26 of this circular which contains its recommendation to the Independent Shareholders in relation to the transactions under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps.

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LETTER FROM THE BOARD

The Board (including the Independent Board Committee after taking into account the advice of the Independent Financial Adviser, but excluding the Interested Directors who are interested or deemed to be interested in the transactions contemplated under the Continuing Connected Transactions) considers that the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps are in the interests of the Company and the Shareholders as a whole and accordingly recommend the Independent Shareholders to vote in favour of the relevant ordinary resolutions to be proposed at the EGM for approving the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps.

GENERAL

Your attention is also drawn to the appendix to this circular.

MISCELLANEOUS

The English text of this circular shall prevail over the Chinese text for the purpose of interpretation.

By Order of the Board eprint Group Limited She Siu Kee William Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

==> picture [145 x 40] intentionally omitted <==

eprint GROUP LIMITED eprint 集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 1884)

1 February 2016

To the Independent Shareholders

Dear Sir or Madam

CONTINUING CONNECTED TRANSACTIONS

We have been appointed as the members of the Independent Board Committee to advise the Independent Shareholders in respect of the resolutions to approve the transactions contemplate under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps, the details of which are set out in the “Letter from the Board” contained in the circular of the Company dated 1 February 2016 (the “ Circular ”) of which this letter forms part. Unless the context otherwise requires, terms defined in the Circular shall have the same meanings when used in this letter.

Your attention is drawn to the “Letter from the Board”, the advice of Messis Capital in its capacity as the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of whether the terms and conditions of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement are fair and reasonable and in the interests of the Company and its Shareholders as a whole, and are in the ordinary and usual course of business of the Company as set out in the “Letter from the Independent Financial Adviser” as well as other additional information set out in other parts of the Circular.

Having taken into account the advice of, and the principal factors and reasons considered by Messis Capital in relation thereto as stated in its letter, we consider the terms and conditions of the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement are on normal commercial terms and are fair and reasonable and are in the interests of the Company and the Shareholders as a whole, and the transactions contemplated hereunder are in the ordinary

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

and usual course of business of the Company. Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolutions to be proposed at the EGM to approve the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps.

Yours faithfully Independent Board Committee

Dr. Lung Cheuk Wah Mr. Chi Man Shing Stephen Ms. Luk Mei Yan Independent non-executive Independent non-executive Independent non-executive Director Director Director

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of the letter from the Independent Financial Adviser which sets out its advice to the Independent Board Committee and the Independent Shareholders for inclusion in this circular.

1 February 2016

To: The Independent Board Committee and the Independent Shareholders of eprint Group Limited

Dear Sir/Madam,

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

We refer to our appointment as the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of (i) the 2015 Tenancy Agreements, the 2015 Master Supply Agreement and the transactions contemplated thereunder and the proposed annual caps related thereto; and (ii) the Printing Services Agreement, the 2016 Printing Services Agreement and the transactions contemplated thereunder and the proposed annual caps related thereto, particulars of which are set out in the letter from the Board (the “ Letter ”) contained in the circular of the Company to the Shareholders dated 1 February 2016 (the “ Circular ”), of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

As stated in the Letter, on 14 December 2015, the Company entered into the 2015 Tenancy Agreements and the 2015 Master Supply Agreement with the respective parties. The 2015 Tenancy Agreements and the 2015 Master Supply Agreement are with terms of commencing from 1 April 2016 and ending on 31 March 2019 and on similar terms to the Tenancy Agreements and the Master Supply Agreement which will expire on 31 March 2016.

In addition, Promise Network has entered into the Printing Services Agreement with Runxing, which shall become a connected person of the Company upon the completion of the acquisition by Mr. Lam ST, that will expire on 31 March 2016 and on 14 December 2015, the parties have entered into the 2016 Printing Services Agreement to renew the terms and conditions of the transactions contemplated thereunder.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

According to the Letter, the transactions contemplated under the respective 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules. As the proposed annual caps in respect of the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement for each of the three years ending 31 March 2019 are more than HK$10,000,000 and the applicable ratios calculated thereof are more than 5%, the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the respective proposed annual caps for each of the three years ending 31 March 2019 are subject to the reporting, announcement, annual review and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

As at the Latest Practicable Date, 550,000,000 Shares were in issue, among which, 313,125,000 Shares (representing approximately 56.93% of the issued Shares) were held by eprint Limited, which is held as to 21.62%, 21.62%, 21.62%, 21.62% and 13.52% by Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung. Pursuant to Rule 2.16 of the Listing Rules, eprint Limited is deemed to have a material interest in the transactions under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement for being a close associate to the parties to the said agreements. Mr. Chong is also interested in 1,592,000 Shares held by his spouse, Ms. Yip Fei. Therefore, eprint Limited and Ms. Yip Fei shall all abstain from voting in favour of the resolutions to approve the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement and the proposed respective annual caps at the EGM.

The Independent Board Committee comprising Dr. Lung Cheuk Wah, Mr. Chi Man Shing Stephen and Ms. Luk Mei Yan, all being the independent non-executive Directors, has been established by the Board to advise the Independent Shareholders in relation to the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement, the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder on (i) whether the terms of such transactions are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned; (ii) whether such transactions are in the interests of the Company and the Shareholders as a whole and are conducted in the ordinary and usual course of business of the Group; and (iii) how the Independent Shareholders should vote in respect of the resolution(s) to approve the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder at the EGM.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

OUR INDEPENDENCE

We have been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard. We have not been appointed as the independent financial adviser to the Company’s other transactions during the last two years. Apart from normal professional fees for our services to the Company in connection with this engagement, no other arrangement exists whereby we will receive any fees and/or benefits from the Group. As at the Latest Practicable Date, we do not have any relationships with or any interests in the Company or any other parties that could reasonably be regarded as relevant to our independence. We are independent under Rule 13.84 of the Listing Rules to act as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in connection with the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder.

Our role as the Independent Financial Adviser is to give our independent opinion to the Independent Board Committee and the Independent Shareholders in relation to the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement, the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder on (i) whether the terms of such transactions are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned; (ii) whether such transactions are in the interests of the Company and the Shareholders as a whole and are conducted in the ordinary and usual course of business of the Group; (iii) advise to the Independent Board Committee on whether the Independent Shareholders should vote in favour of such transactions.

BASIS OF OUR OPINION AND RECOMMENDATION

In formulating our opinion to the Independent Board Committee and the Independent Shareholders, we have reviewed, among other things, the Tenancy Agreements, the 2015 Tenancy Agreements, the Master Supply Agreement, the 2015 Master Supply Agreement, the Printing Services Agreement, the 2016 Printing Services Agreement, the section headed “Connected transactions” in the Prospectus, the annual report of the Company for the year ended 31 March 2015, the interim report of the Company for the six months ended 30 September 2015 and the valuation report prepared by Asset Appraisal Limited, an independent valuer, in relation to the prevailing market rental of the respective properties and relevant terms under the 2015 Tenancy Agreements. We have also discussed with the Company regarding the prospect of the business of the Group.

We have relied on the statements, information, opinions and representations contained or referred to in the Circular and the representations made to us by the Company, the Directors and the management of the Company. We have assumed that all statements, information and representations provided by the Company, the Directors and the management of the Company, for which they are solely responsible, are true and accurate at the time when they were provided and continue to be so as at the Latest Practicable Date. We have also assumed that all statements

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

of belief, opinion, expectation and intention made by the Directors in the Circular were reasonably made after due enquiry and careful consideration. We have no reason to suspect that any material facts or information have been withheld or to doubt the truth, accuracy and completeness of the information and facts contained in the Circular, or the reasonableness of the opinions expressed by the Company, its advisers and/or the Directors, which have been provided to us.

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, opinions expressed in the Circular have been arrived at after due and careful consideration and there are no other facts not contained in the Circular the omission of which would make any statement contained in the Circular, including this letter, incorrect or misleading.

We consider that we have been provided with sufficient information to reach an informed view and to provide a reasonable basis for our opinion. We have not, however, carried out any independent verification of the information provided, nor have we conducted any independent investigation into the business and affairs of the Group, the other connected persons or their respective subsidiaries or associates. Where information in this letter has been extracted from published or otherwise publicly available sources, the sole responsibility of us is to ensure that such information has been correctly and fairly extracted, reproduced or presented from the relevant stated sources and not be used out of context.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion in respect of the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement, the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder, we have considered the following principal factors and reasons:

1. Background of and reasons for entering into the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement

Information on the Group

As stated in the Letter, the Group is principally engaged in provision of printing services and solutions on advertisement, bound books and stationeries, to diversified customer base in Hong Kong, including provision of one-stop internet printing service, from provision of design tools and software of customised products to various kinds of printing and processing services, to meet the diverse needs of the customers.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Information on the connected persons

CTP is principally engaged in the business of property investment, and is beneficially owned as to 25% by Mr. She, 25% by Mr. Chong, 25% by Mr. Lam and 25% by Mr. WM Leung, respectively.

Profit More is principally engaged in the business of property investment, and is wholly owned by CTP.

King Profit is principally engaged in the business of property investment, and is beneficially owned as to approximately 70% by VVV and 30% by Mr. Yip Chi Man.

Wilson Printing is principally engaged in the business of trading of printing equipment and printing materials, and is wholly and beneficially owned by Mr. Lam ST.

Wilson (HK) is principally engaged in the business of trading of printing machineries and spare parts, and is beneficially owned as to 65% by Mr. Lam ST.

Runxing is currently owned by Independent Third Party and is principally engaged in the printing of different kinds of products. The Company was informed by Mr. Lam ST that he has entered into an agreement with Independent Third Parties to acquire the entire interest of Runxing. Completion of the acquisition is expected to take place in early February 2016. Upon completion of the acquisition, Runxing shall be whollyowned by Mr. Lam ST and therefore become a connected person of the Company, hence the transactions contemplated under the Printing Services Agreement shall constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Reasons for entering into the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement

(i) The 2015 Tenancy Agreements

As disclosed in the Prospectus and the Letter, certain subsidiaries of Company had entered into twenty-nine tenancy agreements (collectively, the “ Tenancy Agreements ”) in July 2013, with a total saleable area of 48,000 square feet, for a term of 33 months ending on 31 March 2016 with the respective landlords (whom are connected persons) for leasing the premises necessary for the operations of its business in Hong Kong. The transactions contemplated under the Tenancy Agreements constituted continuing connected transactions for the Company under Chapter 14A of the Listing Rules and were subject to the annual caps for each of the three years ending 31 March 2016. The Tenancy Agreements and the then relevant annual caps for the three years ending 31 March 2016 were exempted from the independent shareholders’ approval requirement pursuant to Rule 14A.105 of the Listing Rules.

CTP, Promise Properties, VVV, Profit More and King Profit are the landlords of certain properties which are leased to the Group. The premises under the 2015 Tenancy Agreements are necessary for the operations of the Group’s business in Hong Kong. As stated in the Letter, the premises under the 2015 Tenancy Agreements are primarily used for, including but not limited to, offices, workshops, stores and car parks.

Given that (i) the Group is principally engaged in provision of printing services and solutions in Hong Kong; (ii) certain subsidiaries of the Group have been using the properties historically; and (iii) the production plants and offices are located in the same industrial building or in close proximity to each other which may save time and cost for the Group, we concur with the view of the Directors that to continue the continuing connected transactions contemplated under the 2015 Tenancy Agreements is in the interest of the Company and the Shareholders as a whole and within the ordinary course of businesses of the Company.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(ii) The 2015 Master Supply Agreement

Reference is also made to the Prospectus in relation to the disclosure of continuing connected transactions between the Company and Wilson Printing and Wilson (HK), which are governed by the Master Supply Agreement signed on or about 27 September 2013 for a term of three years. The Master Supply Agreement will expire on 31 March 2016. The transactions contemplated under the Master Supply Agreement constituted continuing connected transactions for the Company under Chapter 14A of the Listing Rules and were subject to the annual caps for each of the three years ending 31 March 2016. The Master Supply Agreement and the then relevant annual caps for the three years ending 31 March 2016 were exempted from the independent shareholders’ approval requirement pursuant to Rule 14A.105 of the Listing Rules.

According to the Letter, the Group has established a long term relationship with Wilson Printing and Wilson (HK) which provide ink products, zinc printing plates, printing solutions, consumables of printing machines and spare parts to the Group regularly. Ink products, zinc printing plates and printing solutions are the principal raw materials to the Group’s business.

Wilson Printing and Wilson (HK) have been consistently supplying the Group with quality ink products, zinc printing plates and printing solutions in a timely fashion.

Given that (i) the Group is principally engaged in provision of printing services and solutions in Hong Kong while Wilson Printing is principally engaged in the business of trading of printing equipment and printing materials and Wilson (HK) is principally engaged in the business of trading of printing machineries and spare parts; (ii) Wilson Printing and Wilson (HK) consistently provided the Group with quality principal raw materials which is required for the Group’s business operations; and (iii) the stable and well-established business relationship and cooperation history between the Group and Wilson Printing and Wilson (HK) in the past, we concur with the Directors’ view that entering into the 2015 Master Supply Agreement will allow the Group to secure a stable source of principal raw materials and is in the interests of the Company and the Shareholders as a whole, and the terms thereof are on normal commercial terms and fair and reasonable.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(iii) The Printing Services Agreement and the 2016 Printing Services Agreement

As stated in the Letter, Runxing is principally engaged in the printing of different kinds of products.

Given that the Group’s printing utilisation almost reach its maximum capacity, in order to effectively utilising its printing resources, reducing its investment amount of machinery in paper printing segment and controlling its production costs, the Group has since October 2014 outsourced certain printing works to Runxing. Promise Network has also entered into the Printing Services Agreement with Runxing, pursuant to which Runxing agreed to provide the Printing Services to Promise Network for a term of one year commenced from 1 April 2015 to 31 March 2016.

Having considered (i) the Group is principally engaged in provision of printing services and solutions while Runxing is principally engaged in the printing of different kinds of products; (ii) the Group’s printing utilisation almost reach its maximum capacity and under the Printing Services Agreement and the 2016 Printing Services Agreement with Runxing, the Group can continue to utilise its existing printing resources and extend the production capacity by outsourcing certain printing works to Runxing; and (iii) Runxing has been cooperating with the Group since October 2014 and provided quality printing services to the Group in the past, we are of the view that the continuing connected transactions contemplated under the Printing Services Agreement and the 2016 Printing Services Agreement is in the interest of the Company and the Shareholders as a whole and within the ordinary course of businesses of the Company.

Based on the foregoing, we consider that there is a justifiable commercial rationale for the Group and it is in the ordinary course of business of the Group to enter into the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

2. The 2015 Tenancy Agreements

(i) Principal terms of the 2015 Tenancy Agreements

We have extracted from the Letter the major terms of the 2015 Tenancy Agreements as follows:

Date

14 December 2015

Subject matter

(a) 2015 tenancy agreements relating to CTP

Nineteen tenancy agreements entered into between CTP, as landlord, and Lucky Gainer, Promise Network and e-banner as tenants, under which CTP agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer, Promise Network and e-banner Limited, with a total saleable area of approximately 37,354 square feet for use as offices, workshops, stores and car parks. The monthly rentals payable to CTP for the three years ending 31 March 2019 are approximately HK$607,800, HK$668,600 and HK$734,000 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the relevant tenant).

(b) 2015 tenancy agreements relating Promise Properties

Five tenancy agreements entered into between Promise Properties, as landlord, and Lucky Gainer, as tenant, under which Promise Properties agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer with a total saleable area of approximately 8,300 square feet for use as workshops. The monthly rentals payable to Promise Properties for the three years ending 31 March 2019 are approximately HK$137,800, HK$151,400 and HK$167,300 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Six tenancy agreements entered into between VVV, as landlord, Lucky Gainer, as tenant, under which VVV agreed to lease a number of properties located in Kwun Tong Industrial Centre to Lucky Gainer for use as workshops and a car park and one property in Chai Wan to Promise Network for use as a store, with a total saleable area of approximately 12,000 square feet. The monthly rentals payable to VVV for the three years ending 31 March 2019 are approximately HK$233,600, HK$258,100 and HK$285,200 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

(d) 2015 tenancy agreement relating to Profit More

A tenancy agreement entered into between Profit More, as landlord, and Lucky Gainer, as tenant, under which Profit More agreed to lease a property located in Kwun Tong Industrial Centre to Lucky Gainer with a total saleable area of approximately 2,900 square feet for use as a workshop. The monthly rentals payable to Profit More for the three years ending 31 March 2019 are approximately HK$50,000, HK$55,000 and HK$60,000 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

(e) 2015 tenancy agreement relating to King Profit

A tenancy agreement entered into between King Profit, as landlord, and Lucky Gainer and Promise Network, as tenants, under which King Profit agreed to lease a property and a car park located in Kwun Tong Industrial Centre to the tenants with a total saleable area of approximately 1,800 square feet for use as a workshop and car park. The monthly rentals payable to King Profit for the three years ending 31 March 2019 are approximately HK$33,000, HK$36,600 and HK$40,500 respectively (exclusive of government rent, management fees and other utilities outgoings which are payable by the tenant).

(collectively, the “2015 Tenancy Agreements”)

Term

The term of the 2015 Tenancy Agreements shall commence on and from 1 April 2016 and expire on 31 March 2019 (both days inclusive).

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Rental

Pursuant to the 2015 Tenancy Agreements, the rentals are determined based on the prevailing market rental of the respective properties and with reference to the valuation conducted by an independent qualified valuer.

As set out in the Letter, the rentals payable under the 2015 Tenancy Agreements for the abovementioned premises are determined based on the prevailing market rental of the respective properties and with reference to the valuation conducted by an independent qualified valuer, Asset Appraisal Limited.

For our due diligence purpose, we have obtained and reviewed the major terms of each individual 2015 Tenancy Agreement. We understand that under each individual 2015 Tenancy Agreement, the Company shall pay the monthly rentals to the respective landlords (exclusive of government rent, management fee and other utilities outgoings which are payable by the respective tenants).

We have reviewed the valuation report prepared by Asset Appraisal Limited, an independent valuer, and discussed with it the methodology adopted in arriving at the prevailing market rental of the premises under the 2015 Tenancy Agreements as appraised by Asset Appraisal Limited. We have reviewed the terms of engagement of the Asset Appraisal Limited having particular attention to the appropriateness of the scope of work. Based on our review, we are not aware of any limitations on the scope of work which might adversely impact on the degree of assurance given by the valuation report prepared by Asset Appraisal Limited.

We noted from the valuation report that the valuation report that Asset Appraisal Limited that it has valued the premises in relation to the 2015 Tenancy Agreements by direct comparison approach based on rental information of comparable properties with similar size, character and location. Furthermore, Asset Appraisal Limited has confirmed in its opinion letters that other relevant terms and conditions contained in the 2015 Tenancy Agreements are on normal commercial terms under prevailing market conditions and are considered as fair and reasonable.

Based on the above, we consider that the terms of the 2015 Tenancy Agreements are on normal commercial terms and are fair and reasonable, and the entering into the 2015 Tenancy Agreements is in the ordinary and usual course of the Group’s business and is in the interests of the Company and its Shareholders as a whole.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(ii) Proposed annual caps of the 2015 Tenancy Agreements

Set out below are (a) the historical amounts of the rentals paid by the Group to the respective landlords (whom are connected persons) in respect of the premises under the Tenancy Agreements for each of the two financial years ended 31 March 2015 and the eight months ended 30 November 2015; (b) the previous annual caps for the sum to be paid by the Group to the respective landlords (whom are connected persons) in respect of the premises under the Tenancy Agreements for each of the three years ending 31 March 2016; and (c) the proposed annual caps for the sum to be paid by the Group to the respective landlords (whom are connected persons) in respect of the premises under the 2015 Tenancy Agreements for each of the three financial years ending 31 March 2019:

						For the
	For the year ended		For the year ended		eight months ended
		31 March 2014		31 March 2015	30 November 2015
		Approximate		Approximate		Approximate
		HK$’000		HK$’000		HK$’000
Historical amount of
the rentals under the
Tenancy Agreements		6,598		8,851		7,568

						For the
	For the year ended		For the year ended			year ending
		31 March 2014		31 March 2015		31 March 2016
		HK$’000		HK$’000		HK$’000
Previous annual caps under
the Tenancy Agreements		8,670		9,153		9,650

	For the year ending		For the year ending		For the year ending
		31 March 2017		31 March 2018		31 March 2019
		Approximate		Approximate		Approximate
		HK$’000		HK$’000		HK$’000
Proposed annual caps under
the 2015 Tenancy Agreements		12,746		14,036		15,444

As set out in the Letter, the proposed annual caps for the sum to be paid under the 2015 Tenancy Agreements have been determined with reference to the rentals (exclusive of government rent, management fees and other utilities outgoings) stipulated in the 2015 Tenancy Agreements.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In assessing the fairness and reasonableness of the proposed annual caps for the sum to be paid under the 2015 Tenancy Agreements, we have discussed with the management of the Group the bases and assumptions underlying the projections of such proposed annual caps. In calculating the proposed annual caps for the sum to be paid under the 2015 Tenancy Agreements, we understand from the Directors that they have taken into account, among others, the market rent, the rental area, the then market conditions and the monthly rental as stipulated and to be paid under the 2015 Tenancy Agreements in each of the financial years ending 31 March 2017, 2018 and 2019.

We have reviewed the valuation report prepared by Asset Appraisal Limited, an independent valuer and the 2015 Tenancy Agreements, the major reason for the increase in the proposed annual caps under the 2015 Tenancy Agreements as compared to the previous annual caps under the Tenancy Agreements was mainly due to the increase in monthly rentals and increase in the total rental area from approximately 48,000 square feet in the Tenancy Agreements to 54,077 square feet under the 2015 Tenancy Agreements. We understand from the valuer that as part of the comparison approach, they have made reference to, among others, the recent rental prices of sites of comparable size, character and location. We have obtained from the valuer the details of the comparable premises that they had made reference to in valuing the rentals of the premises under the 2015 Tenancy Agreements. We noted that the valuer has identified rentals for premises which are comparable to the premises in relation to the 2015 Tenancy Agreements in terms of each of their size, character and location. Based on our review of such comparable premises, we noted that the rentals for the premises in relation to the 2015 Tenancy Agreements are within the range as indicated by such comparable premises. The aggregated monthly rentals under the 2015 Tenancy Agreements are HK$1,062,200, HK$1,169,700 and HK$1,287,000 for each of the three years ending 31 March 2017, 2018 and 2019 respectively. The proposed annual caps under the 2015 Tenancy Agreements is then calculated from multiplying the aggregated monthly rental by twelve months.

Having considered the bases and assumptions on which the proposed annual caps for the transactions under the 2015 Tenancy Agreements were determined as described above, we are of the view that the proposed annual caps for the transactions under the 2015 Tenancy Agreements are fair and reasonable.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3. The 2015 Master Supply Agreement

(i) Principal terms of the 2015 Master Supply Agreement

As disclosed from the Letter, the major terms of the 2015 Master Supply Agreement are as follows:

Date

14 December 2015

Parties

The Company
Wilson Printing
Wilson (HK)

Wilson Printing and Wilson (HK) collectively as “Sellers”

Subject matter

Pursuant to the 2015 Master Supply Agreement, the Sellers agreed to sell the Products and to provide the Services to the Group for production and operation of the Printing Business.

Term

The term of the 2015 Master Supply Agreement shall commence on and from 1 April 2016 and expire on 31 March 2019 (both days inclusive). Pursuant to the 2015 Master Supply Agreement, either party may terminate the 2015 Master Supply Agreement at any time by giving six months’ prior written notice of termination to the other.

Pricing

Pursuant to the 2015 Master Supply Agreement, the price of the Products and the Services shall be based on (a) the prevailing market prices of similar products or services; or (b) the prices agreed between the Group and the Sellers from time to time after arm’s length negotiation and are comparable to market prices of similar products and services.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The Company and the Sellers agreed that the transactions to be contemplated under the 2015 Master Supply Agreement shall be conducted on normal commercial terms, in particular:

(a) on terms no less favourable to the Group than terms available to or from (as appropriate) Independent Third Parties;
(b) in the ordinary and usual course of business of the Group and conducted after arm’s length negotiations; and
(c) will not exceed the annual caps.

Since no same or similar products have been provided by the Independent Third Party in the past, for our due diligence purpose in assessing the fairness and reasonableness of the price and payment terms under the 2015 Master Supply Agreement, we have obtained and reviewed 19 sample copies of quotations offered to the Group by the Independent Third Parties for similar products and services. The quotations obtained by us include several major items purchased by the Group from the Sellers, including but not limited to, zinc printing plates and ink products. Having considered that (a) the selected product types of samples obtained by us include but not limited to the major items purchased by the Group from the Seller; (b) there were a total of 19 samples being reviewed; (c) the total purchase amount of the selected product types by the Group from the Sellers which we have obtained sample quotations of represented 77% of the actual transaction amount under the Master Supply Agreement for the year ended 31 March 2015; and (d) such samples involved the same or similar products for comparison purpose, we are of the view that such samples are fair and representative for the purpose of our comparison in assessing the fairness and reasonableness of the price and payment terms under the 2015 Master Supply Agreement.

Based on our review of the 19 samples, we noted that the major terms, including but not limited to, pricing basis and payment terms, of the purchase of the Products and the Services by the Group from the Sellers were not less favourable than those offered by the Independent Third Parties to the Group, from the Group’s perspective.

As there is no specific unit price or contract sum agreed with the Sellers, we understand from the Directors that an internal procurement policy was established and implemented by the Group to determine the price and terms of the purchase of the Products and the Services. The procurement department of the Group would obtain not less than three quotations from both the Sellers and Independent Third Party suppliers for similar products and services on a monthly basis to determine if the price and terms offered by the Sellers are comparable to or no less favourable than price and terms offered by Independent Third Party suppliers. After obtaining quotations, the Group will assess by reference to, among other things, the quality

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

of services, experience, credit terms and ability to meet the Group’s requirements so as to determine the party with whom the Group purchase the relevant products and services from. The head of the procurement department will review the price and approve the purchase orders for the relevant products and services. For our due diligence purpose, we have discussed with the Directors to understand (i) the aforesaid procedures; (ii) the approval process and the material managerial staff will be responsible for the above procedures; and (iii) obtained and reviewed the abovementioned sample quotations to verify the internal procurement policy of the Group was in place. We further enquired the Directors regarding the qualification of the material managerial staff of the Company and noted that the material managerial staff is in charge of the material sourcing, procurement activities and material control functions of the operations of the Group. We consider that the effective implementation of the internal control mechanism would help to ensure fair pricing of the transactions contemplated under the 2015 Master Supply Agreement.

Based on the above, we consider that the terms of the 2015 Master Supply Agreement are on normal commercial terms and are fair and reasonable, and the entering into the 2015 Mater Supply Agreement is in the ordinary and usual course of the Group’s business and is in the interests of the Company and its Shareholders as a whole.

(ii) Proposed annual caps of the 2015 Master Supply Agreement

Set out below are (a) the historical amounts of the transactions paid by the Group to the Sellers in respect of the transactions under the Master Supply Agreements for each of the two financial years ended 31 March 2015 and the eight months ended 30 November 2015; (b) the previous annual caps for the sum to be paid by the Group to the Sellers in respect of the transactions under the Master Supply Agreement for each of the three years ending 31 March 2016; and (c) the proposed annual caps for the sum to be paid by the Group to the Sellers in respect of the transactions under the 2015 Master Supply Agreement for each of the three financial years ending 31 March 2019:

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

						For the
	For the year ended		For the year ended		eight months ended
		31 March 2014		31 March 2015	30 November 2015
		Approximate		Approximate		Approximate
		HK$’000		HK$’000		HK$’000
Historical amount of
the transactions under the
Master Supply Agreement		26,270		26,203		14,080

	For the year ended		For the year ended		For the year ending
		31 March 2014		31 March 2015		31 March 2016
		HK$’000		HK$’000		HK$’000
Previous annual caps under
the Master Supply Agreement		26,800		27,500		28,200

	For the year ending		For the year ending		For the year ending
		31 March 2017		31 March 2018		31 March 2019
		HK$’000		HK$’000		HK$’000
Proposed annual caps under the
2015 Master Supply Agreement		20,485		20,338		20,204

With reference to the Letter, the proposed annual caps under the 2015 Master Supply Agreement were determined after taking into account of, among others, (a) the historical amount of the purchase of the Products and the Services required, and (b) the estimated future printing volume of the Printing Business.

For our due diligence purpose, we have discussed with the management of the Group the bases and assumptions underlying the projections of such proposed annual caps. We have obtained and reviewed the estimation from the Group on the demand of the Products and the Services to be provided by the Sellers, which the proposed annual caps under the 2015 Master Supply Agreement are to cater for. As advised by the Directors, it is reasonable to estimate the annual transaction amounts under the 2015 Master Supply Agreement based on, among others, (a) the historical amount of the purchase of the Products and the Services by the Group as the supply of the Products and the Services is required for the Printing Business, which amounted to approximately HK$27.3 million, HK$26.2 million and HK$14.1

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

million for the years ended 31 March 2014 and 2015 and the eight months ended 30 November 2015 respectively; and (b) the estimated future printing volume of the Printing Business. According to the Directors, the estimated future printing volume of the Printing Business for the three years ending 31 March 2017, 2018 and 2019 is based on the combination of the following factors, including but not limited to (i) the market conditions and the expansion of the Hong Kong economy on the whole; (ii) the Group’s future plan to increase the outsourcing of its production for the Printing Business to Runxing under the 2016 Printing Services Agreement, by which the quantity of the Products and the Services required by the Group would decrease for each of the three years ending 31 March 2017, 2018 and 2019 accordingly; and (iii) the increase in average cost per unit to be purchased by the Group from the Sellers along with the decrease in quantity of bulk purchase for the Products and the Services.

We further enquired the Directors about the bases and assumptions of the increase in average cost per unit to be purchased by the Group from the Sellers, it represented the best estimate by the Directors based on the combined factors of (a) the expected upward price adjustments from the Sellers due to the possible rise in wages and cost of raw materials; and (b) the decrease in bulk discount rate to be obtained from the Sellers due to the expected decrease in quantity of the Products and Services to be purchased in each of the three years ending 31 March 2017, 2018 and 2019 accordingly. We concur with the view of the Directors that it is reasonable to make such best estimate based on the abovementioned factors.

Given the above factors, we are of the view that the proposed annual caps under the 2015 Master Supply Agreement for the three years ending 31 March 2019 are fair and reasonable so far as the Independent Shareholders are concerned.

Shareholders should note that as the proposed annual caps under the 2015 Mater Supply Agreement are relating to future events and were estimated based on assumptions which may or may not remain valid for the entire period up to 31 March 2019, and they do not represent forecasts of revenue, income or costs to be incurred from the transactions thereunder. Consequently, we express no opinion to how closely the actual revenue or income or costs to be incurred from the transactions thereunder will correspond with the respective proposed annual caps under the 2015 Master Supply Agreement.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

4. The Printing Services Agreement and the 2016 Printing Services Agreement

(i) Principal terms of the Printing Services Agreement and the 2016 Printing Services Agreement

As disclosed from the Letter, the major terms of the Printing Services Agreement and the 2016 Printing Services Agreement are as follows:

(a) Printing Services Agreement

(b) 2016 Printing Services Agreement

Date:

1 April 2015 (and 14 December 2015 supplemented by a supplemental agreement dated 1 November 2015)

Parties: (a) The Company; and (b) Runxing

Subject matter: Pursuant to the Printing Services Agreement and the 2016 Printing Services Agreement, Runxing agreed to provide the Printing Services to Promise Network.

Term: For one year commenced For the three years ending on from 1 April 2015 and to 31 March 2019 (both days 31 March 2016 (both days inclusive). inclusive).

Pricing: Pursuant to the Printing Services Agreement and the 2016 Printing Services Agreement, the price payable for Printing Services provided by Runxing shall be the price at a discount of ranging from 20% to 35% of the selling price of the Printing Products to be sold by Promise Network.

Since no same or similar printing services have been provided by the Independent Third Party in the past, for our due diligence purpose in assessing the fairness and reasonableness of the price and payment terms under the Printing Services Agreement and the 2016 Printing Services Agreement, we have obtained and reviewed 15 sample copies of the quotations offered to the Group by the Independent Third Parties for similar printing services. The quotations obtained by us include several printing services for the major Printing Products sold by Promise Network, including but not limited to, leaflets, saddle-stitch binding booklets, perfect binding booklets and paper bags. Having considered that (a) the selected printing services of the product types of samples obtained by us include but not limited to the major Printing Products sold by the Group; (b) there were a total of 15 samples being reviewed; (c) the total purchase amount by the Group for the printing

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

services of selected product types which we have obtained sample quotations of represented 90% of the estimated transaction amount under the 2016 Printing Services Agreement for the year ending 31 March 2017; and (d) such samples involved the same or similar printing services for comparison purpose, we are of the view that such samples are fair and representative for the purpose of our comparison in assessing the fairness and reasonableness of the price and payment terms under the Printing Services Agreement and the 2016 Printing Services Agreement.

Based on our review of the 15 samples, we note that the pricing of the Printing Services Agreement and the 2016 Printing Services Agreement entered into between the Group and Runxing were not less favourable than those offered by the Independent Third Parties to the Group, from the Group’s perspective.

As there is no specific unit price or contract sum agreed with Runxing, we understand from the Directors that an internal procurement policy was established and implemented by the Group to determine the price and terms of the purchase of the Printing Services. The procurement department of the Group would obtain not less than three quotations from both Runxing and Independent Third Party suppliers for similar services on an annual basis to determine if the price and terms offered by Runxing are comparable to or no less favourable than the price and terms offered by Independent Third Party suppliers. After obtaining quotations, the Group will assess by reference to, among other things, the quality of services, experience, credit terms and ability to meet the Group’s requirements, in particular the permission of close supervision by the Group for the outsourced printing services, so as to determine the party with whom the Group purchase the relevant services from. The head of the procurement department will review the price and approve the purchase orders for the relevant services. For our due diligence purpose, we have discussed with the Directors to understand (i) the aforesaid procedures; (ii) the approval process and the material managerial staff will be responsible for the above procedures; and (iii) obtained and reviewed the abovementioned sample quotations to verify the internal procurement policy of the Group was in place. We further enquired the Directors regarding the qualification of the material managerial staff of the Company and noted that the material managerial staff is in charge of the printing services sourcing, procurement activities and material control functions of the operations of the Group. We consider that the effective implementation of the internal control mechanism would help to ensure fair pricing of the transactions contemplated under the Printing Services Agreement and the 2016 Printing Services Agreement.

Given that (i) the Group has an effective internal control policy mentioned above; (ii) the Group has sourced three other independent service providers which can provide the printing services of the Printing Products to the Group if and when necessary; and (iii) the Group is also able to expand its production capacity to meet the needs of the printing of the Printing Products if necessary, we consider there is no reliance issue for the Group over Runxing on the Printing Services and the Group has no difficulty in substituting Independent Third Party suppliers for similar printing services required.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In assessing the fairness and reasonableness of the Printing Services Agreement and the 2016 Printing Services Agreement, we have reviewed the terms of the respective agreements, and we did not aware that there is any unusual term in the Printing Services Agreement and the 2016 Printing Services Agreement which is not normal commercial terms. Accordingly, we are of the view that the terms and respective agreements are in the interest of the Group and the Shareholders as a whole.

Based on the above, we consider that the terms of the Printing Services Agreement and 2016 Printing Services Agreement are on normal commercial terms and are fair and reasonable, and the entering into the respective agreements is in the ordinary and usual course of the Group’s business and is in the interests of the Company and its Shareholders as a whole.

(ii) Proposed annual caps of the Printing Services Agreement and the 2016 Printing Services Agreement

Set out below are (a) the historical amount paid by the Group to Runxing in respect of the transactions under the Printing Services Agreements for the eight months ended 30 November 2015; (b) the caps for the sum to be paid by the Group to Runxing in respect of the transactions under the Printing Services Agreement for the three months ending 31 March 2016; and (c) the proposed annual caps for the sum to be paid by the Group to Runxing in respect of the transactions under the 2016 Printing Services Agreement for each of the three financial years ending 31 March 2019:

		For the eight months ended	For the eight months ended	For the eight months ended
			30 November 2015
				Approximate
				HK$’000
Historical amount of the transactions under
the Printing Services Agreement				46,034

		For the three months ending
			31 March 2016
				HK$’000
Cap under the Printing Services Agreement				16,714

For the year ending For the			year ending For the year ending
31 March 2017		31	March 2018	31 March 2019
	HK$’000		HK$’000	HK$’000
Proposed annual caps under the
2016 Printing Services Agreement	132,648		145,913	160,504

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

With reference to the Letter, the proposed annual caps under the 2016 Printing Services Agreement were determined after taking into account of the factors, among others things, (a) the existing order level of the Printing Products from customers; and (b) the expected growth of order level of the Printing Products.

As set out in the table above, we note that the historical amount of the transactions under the Printing Services Agreement was approximately HK$46.0 million for the eight months ended 30 November 2015. As discussed with the management of the Group, in setting the cap under the Printing Services Agreement, the Group mainly made reference to the historical amount of the transactions under the Printing Services Agreement for the eight months ended 30 November 2015 as the management of the Company are of the view that such historical amount of the transactions can reflect the latest market situation of the Printing Business. We noted that the monthly purchase of the Printing Services by the Group from Runxing for the eight months ended 30 November 2015 was approximately HK$5.7 million. The proposed cap for the three months ending 31 March 2015 of approximately HK$16.7 million has been made reference to the historical monthly sales for the eight months ended 30 November 2015.

For our due diligence purpose, we have also discussed with the management of the Group the bases and assumptions underlying the projections of the proposed annual caps under the 2016 Printing Services Agreement. We have obtained and reviewed the estimation from the Group on the expected order level of the Printing Products from customers and therefore the demand of the Printing Services to be provided by Runxing, which the proposed annual caps under the 2016 Printing Services Agreement are to cater for. As advised by the Directors, it is reasonable to estimate the annual transaction amounts under the 2016 Printing Services Agreement based on (a) the existing order level of the Printing Products from customers; and (b) the expected growth of order level of the Printing Products. According to the Directors, the expected growth of order level of Printing Products of the Group for the three years ending 31 March 2017, 2018 and 2019 is based on (i) the revenue growth of the paper printing segment according to the interim report of the Company for the six months ended 30 September 2015; and (ii) the market conditions and the expansion of the Hong Kong economy on the whole.

We consider that the bases and assumptions of the expected growth of order level of Printing Products are fair and reasonable according to (i) and (ii) above. Firstly, the revenue growth of the paper printing segment in the interim report of the Company for the six months ended 30 September 2015 reflected the latest financial results for the paper printing segment which directly involves the Printing Services required by the Group and had taken into account for the latest business development of the Group. According to the interim report of the Company for the six months ended 30 September 2015, the Group acquired an additional interest of e-banner Limited (“ e-banner ”) on 1 April 2015 and e-banner became a subsidiary of the Group. The management of the Group believed that the operation of e-banner would create

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

synergy effect with the Group and the effect would only be reflected in the latest interim report. Secondly, the market conditions and expansion of the Hong Kong economy directly influence that of the commercial printing industry. According to the Directors, the commercial printing industry provides products and services which cater the basic demand from individuals and corporations of most industries in Hong Kong. With reference to a report titled “Chain volume measures of gross domestic product by economic activity for third quarter of 2015” issued by the Census and Statistics Department of Hong Kong Special Administrative Region (the “ Census and Statistics Department ”) in December 2015, the increase of the gross domestic product of the services industry in Hong Kong for the period from January 2015 to September 2015 was 2.0%. Furthermore, according to another report titled “Hong Kong Annual Digest of Statistics” issued by the Census and Statistics Department in October 2015, the compound annual growth rate of the producer price index for the paper products, printing and reproduction of recorded media industry from 2009 to 2014 is 1.1%. Based on the combined effects from the business expansion of the Group and the general growth of the printing industry in Hong Kong, we consider the bases and assumptions are fair and reasonable for the Directors to make the best estimate for the expected growth of order level of Printing Products.

Given the above factors, we consider that the proposed annual caps under the Printing Services Agreement and the 2016 Printing Services Agreement for the three years ending 31 March 2019 are fair and reasonable so far as the Independent Shareholders are concerned.

Shareholders should note that as the proposed annual caps under the 2016 Printing Services Agreement are relating to future events and were estimated based on assumptions which may or may not remain valid for the entire period up to 31 March 2019, and they do not represent forecasts of revenue, income or costs to be incurred from the transactions thereunder. Consequently, we express no opinion to how closely the actual revenue or income or costs to be incurred from the transactions thereunder will correspond with the respective proposed annual caps under the 2016 Printing Services Agreement.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

5. Listing Rules implication

The Directors confirmed that the Company shall comply with the requirements of the Rules 14A.53 to 14A.59 of the Listing Rules pursuant to which (i) the values of the continuing connected transactions under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement must be restricted by the proposed annual caps related thereto for the three years ending 31 March 2019; (ii) the terms of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement must be reviewed by the independent non-executive Directors annually; (iii) details of independent non-executive Directors’ annual review on the terms of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement must be included in the Company’s subsequent published annual reports and financial accounts.

Furthermore, it is also required by the Listing Rules that the auditors of the Company must provide a letter to the Board confirming, among other things, whether anything has come to their attention that causes them to believe that the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement (i) have not been approved by the Board; (ii) were not entered into, in all material respects, in accordance with the relevant agreement governing the transactions; and (iii) have exceeded the proposed annual caps related to the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement. In the event that the total amounts of the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement exceed the respective proposed annual caps related thereto, or that there is any material amendment to the terms of the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement, as confirmed by the Directors, the Company shall comply with the applicable provisions of the Listing Rules governing continuing connected transactions.

Given the above stipulated requirements for continuing connected transactions pursuant to the Listing Rules, we are of the view that there are adequate measures in place to monitor the transactions contemplated under the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and thus the interest of the Independent Shareholders would be safeguarded.

– 50 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

RECOMMENDATION

Having taken into consideration the principal factors and reasons discussed above, we are of the opinion that the continuing connected transactions under the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement (including the proposed annual caps related thereto) are on normal commercial terms and conducted in the ordinary and usual course of business of the Group, in the interests of the Company and the Shareholders as a whole, and fair and reasonable so far as the Independent Shareholders are concerned. Accordingly, we recommend the Independent Shareholders, as well as the Independent Board Committee to advise the Independent Shareholders, to vote in favour of the relevant resolutions to be proposed at the EGM to approve the continuing connected transactions under the 2015 Tenancy Agreements, the 2015 Master Agreement, the Printing Services Agreement, the 2016 Printing Services Agreement (including the proposed annual caps related thereto) and the transactions contemplated thereunder.

Yours faithfully, For and on behalf of Messis Capital Limited

Robert Siu

Managing Director

Note: Mr. Robert Siu is a licensed person registered with the Securities and Future Commission of Hong Kong and a responsible officer of Messis Capital Limited to carry out type 1 (dealing in securities) and type 6 (advising on corporate finance) regulated activities under the SFO and has over 15 years of experience in corporate finance industry.

– 51 –

GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in the compliance with the Listing Rules for the purpose of giving information with regard to the Group. 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

Directors’ and Chief Executives’ Interests in Shares

As at the Latest Practicable Date, the interests or short positions of the Directors and chief executives of the Company in the shares, underlying shares and debentures of the Company or any associated corporation (within the meaning of Part XV of the SFO) which were notified 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 are taken or deemed to have under such provisions of the SFO), or which were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (“ Model Code ”) as set out in Appendix 10 to the Listing Rules are set out below:

Interests or short positions in shares, underlying shares and debentures of the Company or its associated corporation

(i) The Company

				Approximate
			Number of	percentage of
		Long position/	ordinary	shareholding in
Name of Director	Capacity	short position	shares held	the Company
Mr. She	Interest of controlled	Long position	313,125,000	56.93%
	corporation_(Note 1)_
Mr. Chong	Interest of controlled	Long position	313,125,000	56.93%
	corporation_(Note 1)_
	Interest of spouse_(Note 2)_	Long position	1,592,000	0.29%
Mr. Lam	Interest of controlled	Long position	313,125,000	56.93%
	corporation_(Note 1)_
Mr. WM Leung	Interest of controlled	Long position	313,125,000	56.93%
	corporation_(Note 1)_

– 52 –

GENERAL INFORMATION

APPENDIX

Notes:

313,125,000 Shares are held by eprint Limited. eprint Limited is held as to 21.62%, 21.62%, 21.62%, 21.62% and 13.52% by Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung respectively. Pursuant to a deed of confirmation dated 2 July 2013 and entered into by them confirming the existence of their acting in concert arrangement, each of Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung has agreed to jointly control their respective interests in the Company. Accordingly, eprint Limited shall be accustomed to act in accordance with joint instructions of the Concerted Shareholders. Hence, each of the Concerted Shareholders is deemed to be interested in all the Shares held by eprint Limited by virtue of the SFO.
Mr. Chong is interested in 1,592,000 Shares held by his spouse, Ms. Yip Fei.

(ii) Associated corporation – eprint Limited

		Number of	Approximate
		ordinary shares	percentage of
		held in the	shareholding in
		associated	the associated
Name of Director	Nature of interest	corporation	corporation
Mr. She	Beneficial owner	2,162	21.62%
Mr. Chong	Beneficial owner	2,162	21.62%
Mr. Lam	Beneficial owner	2,162	21.62%
Mr. WM Leung	Beneficial owner	2,162	21.62%

Note: The disclosed interest represents the interests in eprint Limited, the controlling Shareholder, which is owned by Mr. She, Mr. Chong, Mr. Lam, Mr. WM Leung and Mr. YP Leung in the respective proportions of 21.62%, 21.62%, 21.62%, 21.62% and 13.52%.

Save as disclosed above, none of the Directors, chief executives of the Company and/or their associates had any interests or short positions in any shares, underlying shares and debentures of the Company or any of its associated corporations as at the Latest Practicable Date as recorded in the register to be kept under section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.

Substantial Shareholders and Other Persons’ Interests in Shares

As at the Latest Practicable Date, so far as is known to the Directors, the following persons (other than the Directors and the chief executives of the Company) had interests or short positions in the shares and underlying shares of the Company as recorded in the register required to be kept under section 336 of the SFO.

– 53 –

GENERAL INFORMATION

APPENDIX

Interests or short positions in shares and underlying shares of the Company

				Approximate
			Number of	percentage of
			ordinary	shareholding in
Name	Capacity	Position	shares held	the Company
eprint Limited_(Note 1)_	Beneficial owner	Long position	313,125,000	56.93%
Ms. Lo Suet Yee_(Note 2)_	Interest of spouse	Long position	313,125,000	56.93%
Ms. Yip Fei_(Note 3)_	Beneficial owner	Long position	1,592,000	0.29%
	Interest of spouse	Long position	313,125,000	56.93%
Ms. Yu Siu Ping_(Note 4)_	Interest of spouse	Long position	313,125,000	56.93%
Ms. Chau Fung Kiu_(Note 5)_	Interest of spouse	Long position	313,125,000	56.93%
Mr. Huang Xiaopeng_(Note 6)_	Interest of controlled	Long position	61,875,000	11.25%
	corporation
Mr. Huang Xiaojia_(Note 6)_	Interest of controlled	Long position	61,875,000	11.25%
	corporation
Mr. Huang Bingwen_(Note 6)_	Interest of controlled	Long position	61,875,000	11.25%
	corporation
Hong Kong Tung Fung Investment	Interest of controlled	Long position	61,875,000	11.25%
Company Limited_(Note 6)_	corporation
Shantou Dongfeng Printing	Interest of controlled	Long position	61,875,000	11.25%
Co. Ltd.(Note 6)	corporation
Hong Kong Luck Investment	Beneficial owner	Long position	61,875,000	11.25%
Company Limited_(Note 6)_
Mr. YP Leung	Interest of controlled	Long position	313,125,000	56.93%
	corporation_(Note 7)_

Notes:

eprint Limited is directly interested in approximately 56.93% in the Company.
Ms. Lo Suet Yee is the spouse of Mr. She. Under the SFO, Ms. Lo Suet Yee is taken to be interested in the same number of Shares in which Mr. She is interested.

– 54 –

GENERAL INFORMATION

APPENDIX

Ms. Yip Fei is the spouse of Mr. Chong. Under the SFO, Ms. Yip Fei is taken to be interested in the same number of Shares in which Mr. Chong is interested.
Ms. Yu Siu Ping is the spouse of Mr. Lam. Under the SFO, Ms. Yu Siu Ping is taken to be interested in the same number of Shares in which Mr. Lam is interested.
Ms. Chau Fung Kiu is the spouse of Mr. WM Leung. Under the SFO, Ms. Chau Fung Kiu is taken to be interested in the same number of Shares in which Mr. WM Leung is interested.
These 61,875,000 Shares are held by Hong Kong Luck Investment Company Limited, which is a wholly-owned subsidiary of Shantou Dongfeng Printing Co. Ltd. (“ Shantou Dongfeng ”), an A share company listed on the main board of the Shanghai Stock Exchange. Shantou Dongfeng is 54.40% held by Hong Kong Tung Fung Investment Company Limited and 1.11% held by Mr. Huang Xiaojia. Hong Kong Tung Fung Investment Company is owned as to 34% by Mr. Huang Xiaopeng, 33% by Mr. Huang Xiaojia and 33% by Mr. Huang Bingwen. Under the SFO, each of Shantou Dongfeng, Hong Kong Tung Fung Investment Company Limited, Mr. Huang Xiaopeng, Mr. Huang Xiaojia and Mr. Huang Bingwen is taken to be interested in the same number of Shares in which Hong Kong Luck Investment Company Limited is interested.
These 313,125,000 shares are held through eprint Limited, a company which is beneficially owned as to 13.52% by Mr. YP Leung.

Save as disclosed above, the Directors are not aware of any other persons who have interests or short positions in the shares, underlying shares or debentures of the Company or any associated corporations (within the meaning of the SFO) as recorded in the register required to be kept under section 336 of the SFO as at the Latest Practicable Date.

3. COMPETING INTERESTS

As at the Latest Practicable Date, the Directors were not aware that any of the Directors and their respective close associates has interest in any business which competes or is likely to compete, either directly or indirectly, with the businesses of the Group.

4. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors confirm that there has not been any material adverse change in the financial or trading position of the Company since 31 March 2015, being the date of the latest published audited financial statements of the Company.

5. LITIGATION

As at the Latest Practicable Date, none of the Company or any of its subsidiaries has received notice of any litigation or arbitration proceedings pending or threatened against the Company or any of the subsidiaries of the Company.

– 55 –

GENERAL INFORMATION

APPENDIX

6. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors has entered into or proposed to enter into any service contract with the Company or any of its subsidiaries which will not expire or may not be terminated by the Group within one (1) year without the payment of compensation other than statutory compensation.

7. DIRECTORS’ INTEREST IN ASSETS OR CONTRACTS

As at the Latest Practicable Date, none of the Directors of the Company had any interest in any assets which have been since 31 March 2015 (being the date to which the latest published audited accounts of the Group were made up) acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

As at the Latest Practicable Date, none of the Directors is materially interested in any contract or arrangement subsisting at the Latest Practicable Date which is significant in relation to the business of the Group, save for the Tenancy Agreements, the Master Supply Agreement, the 2015 Tenancy Agreements, the 2015 Master Supply Agreement, the Printing Services Agreement and the 2016 Printing Services Agreement.

8. EXPERT

(a) The following is the qualification of Messis Capital, which has given its opinion or advice which is contained in this circular:

Name

Qualification

Messis Capital Limited

a licensed corporation under the SFO permitted to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities for the purpose of the SFO

(b) As at the Latest Practicable Date, Messis Capital did not have any shareholding, direct or indirect, in the Company or any other member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in the other member of the Group, nor did it have any interest, direct or indirect, in any assets which had, since 31 March 2015, being the date up to which the latest published audited financial statements of the Group were made up, been acquired or disposed of by or leased to the Group, or were proposed to be acquired or disposed of by or leased to the Group.

Messis Capital has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which they appear.

– 56 –

GENERAL INFORMATION

APPENDIX

9. MISCELLANEOUS

(a) The company secretary of the Company is Mr. Fung Hong Keung who is a member of the Hong Kong Institute of Certified Public Accountants and a fellow member of the Association of Chartered Certified Accountants.
(b) The registered office of the Company is located at 4th Floor, Harbour Place, 103 South Church Street, George Town, PO Box 10240, Grand Cayman KY1-1002, Cayman Islands. The principal place of business of the Company in Hong Kong is located at Flat A3, 1/F., Phase 3, Kwun Tong Industrial Centre, 448-458 Kwun Tong Road, Kwun Tong, Kowloon, Hong Kong.
(c) The English text of this circular shall prevail over the Chinese text in case of any inconsistency.

10. DOCUMENTS FOR INSPECTION

Copies of the following documents will be available for inspection at the principal place of business in Hong Kong of the Company at Flat A3, 1/F., Phase 3, Kwun Tong Industrial Centre, 448-458 Kwun Tong Road, Kwun Tong, Kowloon, Hong Kong during normal business hours on any business day for a period of 14 days from the date of this circular:

(a) this circular;
(b) the Articles;
(c) the letter from the Independent Board Committee, the text of which is set out in this circular;
(d) the letter from the Independent Financial Adviser, the text of which is set out in this circular;
(e) the written consent of Messis Capital referred to in the paragraph headed “Expert” above;
(f) the 2015 Tenancy Agreements;
(g) the 2015 Master Supply Agreement;
(h) the Printing Services Agreement;
(i) the 2016 Printing Services Agreement; and
(j) the annual report of the Company for the year ended 31 March 2015.

– 57 –

NOTICE OF EXTRAORDINARY GENERAL MEETING

==> picture [145 x 40] intentionally omitted <==

eprint GROUP LIMITED eprint 集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 1884)

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting of eprint Group Limited (the “ Company ”) will be held at élan 120, 3rd Floor, L’Hotel élan, 38 Chong Yip Street, Kwun Tong, Kowloon, Hong Kong on Wednesday, 24 February 2016 at 11:00 a.m. for the purpose of considering and, if thought fit, passing the following resolutions as ordinary resolutions:

1. “ THAT :

(a) the following tenancy agreements all dated 14 December 2015 (the “ 2015 Tenancy Agreements ”):
(i) nineteen tenancy agreements entered into between CTP Limited, as landlord, and Lucky Gainer Limited (“ Lucky Gainer ”), Promise Network Printing Limited (“ Promise Network ”) and e-banner Limited (“ e-banner ”), all are subsidiaries of the Company as tenants, copies of which are tabled at the Meeting and marked “A1” to “A19” and initialed by the chairman of the Meeting for identification purpose, for the leasing of a number of properties located in Kwun Tong Industrial Centre be and are hereby approved, confirmed and ratified;
(ii) five tenancy agreements entered into between Promise Properties Limited, as landlord, and Lucky Gainer, as tenant, copies of which are tabled at the Meeting and marked “A20” to “A24” and initialed by the chairman of the Meeting for identification purpose, for the leasing of a number of properties located in Kwun Tong Industrial Centre be and are hereby approved, confirmed and ratified;
(iii) six tenancy agreements entered into between VVV Limited, as landlord, and Lucky Gainer and Promise Network, as tenants, copies of which are tabled at the Meeting and marked “A25” to “A30” and initialed by the chairman of the Meeting for identification purpose, for the leasing of a number of properties and a car park located in Kwun Tong Industrial Centre and one property in Chai Wan be and are hereby approved, confirmed and ratified;

– EGM-1 –

NOTICE OF EXTRAORDINARY GENERAL MEETING

  - (iv) a tenancy agreement entered into between Profit More Rich Limited, as landlord, and Lucky Gainer, as tenant, a copy of which is tabled at the Meeting and marked “A31” and initialed by the chairman of the Meeting for identification purpose, for the leasing of a property located in Kwun Tong Industrial Centre be and is hereby approved, confirmed and ratified;

  - (v) a tenancy agreement entered into between King Profit International Limited, as landlord, and Lucky Gainer and Promise Network, as tenants, a copy of which is tabled at the Meeting and marked “A32” and initialed by the chairman of the Meeting for identification purpose, for the leasing of a property and a car park located in Kwun Tong Industrial Centre be and is hereby approved, confirmed and ratified.

(b) the annual caps under the 2015 Tenancy Agreements as set out in the circular of the Company dated 1 February 2016 (the “ Circular ”) for the three years ending 31 March 2019 be and are hereby approved and confirmed; and
(c) any one director of the Company be and is hereby authorized to do all such acts or things and sign all documents deemed necessary by him/her to be incidental to, ancillary to or in connection with the matters contemplated under the 2015 Tenancy Agreements.”
“ THAT :
(a) the agreement dated 14 December 2015 (“ 2015 Master Supply Agreement ”) entered into between the Company, Wilson Printing Equipment Limited and Wilson (Hong Kong) Limited (collectively, the “ Sellers ”), a copy of which is tabled at the Meeting and marked “B” and initialed by the chairman of the Meeting for identification purpose, pursuant to which the Sellers shall supply the Products (as defined in the Circular) and provide the Services (as defined in the Circular) to the Company for the Printing Business (as defined in the Circular) be and is hereby approved, confirmed and ratified;
(b) the annual caps under the 2015 Master Supply Agreement as set out in the Circular for the three years ending 31 March 2019 be and are hereby approved and confirmed; and
(c) any one director of the Company be and is hereby authorized to do all such acts or things and sign all documents deemed necessary by him/her to be incidental to, ancillary to or in connection with the matters contemplated under the 2015 Master Supply Agreement.”

– EGM-2 –

NOTICE OF EXTRAORDINARY GENERAL MEETING

“ THAT :
(a) the agreement dated 1 April 2015 (“ Printing Services Agreement ”) entered into between Promise Network and 東莞市潤興呈品印刷有限公司(Dongguan Runxing Chengpin Printing Company Limited) (“ Runxing* ”) as supplemented by a supplemental agreement dated 1 November 2015, a copy of which is tabled at the Meeting and marked “C” and initialed by the chairman of the Meeting for identification purpose, pursuant to which Runxing agreed to provide the Printing Services (as defined in the Circular) be and is hereby approved, confirmed and ratified;
(b) the caps under the Printing Services Agreement as set out in the Circular for the three months ending 31 March 2016 be and is hereby approved and confirmed; and
(c) any one director of the Company be and is hereby authorized to do all such acts or things and sign all documents deemed necessary by him/her to be incidental to, ancillary to or in connection with the matters contemplated under the Printing Services Agreement.”
“ THAT :
(a) the agreement dated 14 December 2015 (“ 2016 Printing Services Agreement ”) entered into between Promise Network and Runxing, a copy of which is tabled at the Meeting and marked “D” and initialed by the chairman of the Meeting for identification purpose, pursuant to which Runxing agreed to provide the Printing Services (as defined in the Circular) be and is hereby approved, confirmed and ratified
(b) the annual caps under the 2016 Printing Services Agreement as set out in the Circular for the three years ending 31 March 2019 be and are hereby approved and confirmed; and
(c) any one director of the Company be and is hereby authorized to do all such acts or things and sign all documents deemed necessary by him/her to be incidental to, ancillary to or in connection with the matters contemplated under the 2016 Printing Services Agreement.”

By Order of the Board eprint Group Limited Fung Hong Keung Company Secretary

Hong Kong, 1 February 2016

– EGM-3 –

NOTICE OF EXTRAORDINARY GENERAL MEETING

Notes:

Any member of the Company entitled to attend and vote at the meeting convened by this notice shall be entitled to appoint proxy to attend and vote in his stead in accordance with the articles of association of the Company. A proxy need not be a member of the Company but must be present in person to represent the member.
A form of proxy for use at the above meeting is enclosed.
To be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a certified copy thereof, must be lodged with the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, Level 22, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the meeting. Completion and return of the form of proxy will not preclude members from attending and voting in person at the meeting or any adjournment thereof should they so wish.
As at the date of this notice, the Board comprises two executive Directors, namely Mr. She Siu Kee William (Chairman) and Mr. Fung Hong Keung; four non-executive Directors, namely Mr. Chong Cheuk Ki, Mr. Lam Shing Kai, Mr. Leung Wai Ming and Mr. Deng Xiaen and three independent non-executive Directors, namely Dr. Lung Cheuk Wah, Mr. Chi Man Shing Stephen and Ms. Luk Mei Yan.
for identification purpose only

– EGM-4 –

AI assistant

eprint Group Limited — Proxy Solicitation & Information Statement 2016

50240_rns_2016-01-31_cb980e32-569f-4e69-93a1-013fba146791.pdf

eprint GROUP LIMITED eprint 集團有限公司 (Incorporated in the Cayman Islands with limited liability)

CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EXTRAORDINARY GENERAL MEETING

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

LETTER FROM THE BOARD

eprint GROUP LIMITED eprint 集團有限公司

CONTINUING CONNECTED TRANSACTIONS

CONTINUING CONNECTED TRANSACTIONS

2015 TENANCY AGREEMENTS

Background

2015 Tenancy Agreements

Date

Subject matter:

LETTER FROM THE BOARD

Term

Rental

Proposed Annual Caps

Conditions

2015 MASTER SUPPLY AGREEMENT

Background

2015 Master Supply Agreement

Date

Parties

Supply service

Term

Pricing

Proposed Annual Caps

Conditions

PRINTING SERVICES AGREEMENT

Background

Printing Services

Term

Conditions

Pricing

Proposed annual caps

LETTER FROM THE BOARD

REASONS FOR THE 2015 TENANCY AGREEMENTS, 2015 MASTER SUPPLY AGREEMENT, PRINTING SERVICES AGREEMENT AND 2016 PRINTING SERVICES AGREEMENT

2015 Tenancy Agreements

2015 Master Supply Agreement

LETTER FROM THE BOARD

Printing Services Agreement and the 2016 Printing Services Agreement

GENERAL

THE INDEPENDENT BOARD COMMITTEE AND THE INDEPENDENT FINANCIAL ADVISER

EGM

LETTER FROM THE BOARD

RECOMMENDATION

LETTER FROM THE BOARD

GENERAL

MISCELLANEOUS

eprint GROUP LIMITED eprint 集團有限公司

CONTINUING CONNECTED TRANSACTIONS

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

OUR INDEPENDENCE

BASIS OF OUR OPINION AND RECOMMENDATION

PRINCIPAL FACTORS AND REASONS CONSIDERED

2. The 2015 Tenancy Agreements

Term

Rental

3. The 2015 Master Supply Agreement

Parties

Term

4. The Printing Services Agreement and the 2016 Printing Services Agreement

(a) Printing Services Agreement

(b) 2016 Printing Services Agreement

5. Listing Rules implication

RECOMMENDATION

Robert Siu

Managing Director

1. RESPONSIBILITY STATEMENT

2. DISCLOSURE OF INTERESTS

Directors’ and Chief Executives’ Interests in Shares

Interests or short positions in shares, underlying shares and debentures of the Company or its associated corporation

eprint Group Limited Proxy Solicitation & Information Statement 2016