Esprit Holdings Limited — Proxy Solicitation & Information Statement 2005

Oct 7, 2005

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about any aspect of this circular or as to the action to be taken, you should consult your stockbroker, or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in The Grande Holdings Limited, you should at once hand this circular to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaims 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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THE GRANDE HOLDINGS LIMITED 嘉域集團有限公司

(Incorporated in Cayman Islands and redomiciled to Bermuda with Limited Liability)

(Stock Code: 186)

DISCLOSEABLE TRANSACTION –

PROPOSED ACQUISITION OF EMERSON RADIO CORP.

7 October 2005

CONTENTS

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
2.	Principal Terms of the S&P Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
3.	Information on the Vendor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
4.	Reasons for the Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
5.	Implication under the Listing Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
6.	General Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
7.	General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
8.	Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Appendix – General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		11

DEFINITIONS

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

• “Acquisition” acquisition of the 10 million common shares of Emerson; “associates” has the same meaning as ascribed in the Listing Rules; “Board” the board of Directors; “Business Day(s)” a day on which banks in both Hong Kong and New York City are open for normal banking business (excluding Saturdays and Sundays);

• “Company” The Grande Holdings Limited, a company incorporated in the Cayman Islands and continued in Bermuda with limited liability, the Shares of which are listed on the Main Board of the HKSE;

• “Completion Date” 10 October 2005 (or such later date as the parties may agree in writing);

• “Convertible Debenture” a debenture of the Company, in the face amount of US$26 million convertible into Shares;

• “Conversion Share(s)” the Shares to be issued by the Company under the Convertible Debenture;

• “Debenture holder” the person who is for the time being the registered holder of the Debenture;

• “Director(s)” director(s) of the Company (including independent non-executive Directors of the Company);

• “Emerson” Emerson Radio Corp., a Delaware corporation, the shares of which are listed on the American Stock Exchange of US;

“First Announcement” the announcement made by the Company dated 24 August 2005 and published on 25 August 2005;

“HKFRS” the Hong Kong Financial Reporting Standards;

“General Mandate” the general mandate to issue or deal with 92,045,464 shares representing 20 per cent. of the issued Shares as at 27 June 2005 granted to the Directors at the annual general meeting of the Company held on 27 June 2005;

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DEFINITIONS

• “Group” the Company and its subsidiaries; “Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China;

• “HKSE” The Stock Exchange of Hong Kong Limited; “Issue Date” the date of issue of the Convertible Debenture; “Latest Practicable Date” 4 October 2005, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular;

• “Maturity Date” the outstanding principal amount of the Convertible Debenture, together with any unpaid interest accrued thereon up to and including the date of actual payment to be repaid by the Company on the third anniversary of the issue date of the Convertible Debenture;

• “Model Code” Model Code for Securities Transactions by Directors of Listed Issuers as stated in the Appendix 10 of the Listing Rules;

• “Purchaser” S&T International Distribution Limited, a wholly-owned subsidiary of the Company;

• “S&P Agreement” the agreement dated 20 August 2005 entered into between the Purchaser and the Vendor in respect of the Acquisition;

• “SFO” the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong;

• “Sale Consideration” the total consideration of US$52 million payable by the Purchaser to the Vendor pursuant to the S&P Agreement;

• “Second Announcement” the announcement made by the Company dated 28 September 2005 and published on 29 September 2005;

• “Share(s)” Ordinary Share(s) of HK$0.10 each in the share capital of the Company;

• “Shareholder(s)” holder(s) of the Shares;

• “Sale Shares” 10 million common shares in the capital of Emerson, representing approximately 37% of the entire issued share capital of Emerson on a fully diluted basis as at the date of the S&P Agreement;

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DEFINITIONS

“US” United States of America; and “US$” United States Dollars, being the lawful currency of the United States of America.

For the purpose of this circular, unless otherwise specified, conversion of US$ into HK$ is calculated at the approximate exchange rate of US$1.00 to HK$7.8. This exchange rate is for purpose of illustration only and does not constitute a representation that any amounts have been, could have been or may be, exchanged at this or any other rates at all.

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LETTER FROM THE BOARD

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THE GRANDE HOLDINGS LIMITED 嘉域集團有限公司

(Incorporated in Cayman Islands and redomiciled to Bermuda with Limited Liability)

(Stock Code: 186)

Executive Directors: Christopher W. Ho (Chairman) Adrian C. C. Ma (Managing Director) Christine L. S. Asprey Michael A. B. Binney C. F. Lam Paul K. F. Law

Registered Office: 2 Reid Street, Hamilton HM11, Bermuda

Principal Place of Business: 12th Floor, The Grande Building, 398 Kwun Tong Road, Kowloon, Hong Kong

Independent Non-executive Directors: Herbert H. K. Tsoi Johnny W. H. Lau Martin I. Wright

7 October 2005

To the Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION – PROPOSED ACQUISITION OF EMERSON RADIO CORP.

INTRODUCTION

The Board announces that on 20 August 2005 the Purchaser, a wholly-owned subsidiary of the Company, entered into the S&P Agreement in respect of the Acquisition with the Vendor pursuant to which the Vendor agreed to sell and the Purchaser agreed to purchase the Sale Shares at the Sale Consideration.

The Sale Consideration payable under the S&P Agreement is US$52 million and will be satisfied as to (i) US$26 million in cash upon completion of the Acquisition and (ii) the balance of US$26 million by the issue of the Convertible Debenture of the Company at face value. The terms and conditions under the S&P Agreement were determined at arm’s length negotiation.

The Directors confirm that, to the best of the Directors’ knowledge, information and belief and having made all reasonable enquiries, the Vendor, being the ultimate beneficial owner of Emerson, is a third party independent of the Company and connected persons (as defined in the Listing Rules) of the Company. The Acquisition constitutes a discloseable transaction for the Company under the Listing

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LETTER FROM THE BOARD

Rules. The purpose of this circular is to provide you with, among other things, details of the Acquisition pursuant to the requirement of the Listing Rules.

PRINCIPAL TERMS OF THE S&P AGREEMENT

(1) Date:

20 August 2005

(2) Parties:

Purchaser: S&T INTERNATIONAL DISTRIBUTION LIMITED , a company incorporated in the British Virgin Islands and a wholly-owned subsidiary of the Company. The principal activity of the Purchaser is investment holding.

Vendor: MR. GOTTFRIED LUDWIG PRENTICE JURICK , a third party independent of the Company and connected persons (as defined in the Listing Rules) of the Company.

(3) Assets to be acquired:

10 million common shares representing approximately 37% of the issued and outstanding shares of Emerson on a fully-diluted basis.

According to the Form 10-K (Annual report for the year ended 31 March 2005) filed by Emerson to the U.S. Securities and Exchange Commission (“SEC”), the audited net asset value of Emerson as at 31 March 2005 was US$53,603,000 (equivalent to approximately HK$418,103,000). The audited net profit after taxation of Emerson was US$5,905,000 (equivalent to approximately HK$46,059,000) for the year ended 31 March 2005 (31 March 2004: a loss of US$1,074,000 (equivalent to approximately HK$8,377,000)). The audited net profit before taxation of Emerson was US$8,888,000 (equivalent to approximately HK$69,326,000) for the year ended 31 March 2005 (31 March 2004: US$1,076,000 (equivalent to approximately HK$8,392,000)).

Subsequent to 31 March 2005, Emerson completed its sale of its 53.2% interest in Sport Supply Group, Inc. (“SSG”) on 1 July 2005. As a result, SSG was no longer a subsidiary of Emerson and Emerson should present the results of operations of SSG as discontinued operations in Emerson’s accounts for the year ending 31 March 2006. The Form 8-K (Current report) dated 1 July 2005 filed by Emerson to SEC included adjustments for disposal of interests in SSG so that the Company considers that the disclosure of the pro forma financial statements of Emerson in the First Announcement with reference to the Form 8-K is more appropriate in reflecting the current financial position of Emerson.

According to the Form 8-K, the unaudited pro forma net asset value of Emerson was US$65,592,000 (equivalent to approximately HK$511,617,000) as at 31 March 2005 and the unaudited pro forma net profit from the continuing operations after taxation of Emerson was US$5,537,000 (equivalent to approximately HK$43,188,000) for the year ended 31 March 2005 (2004: US$60,000 (equivalent to approximately HK$468,000)). The unaudited pro forma net profit from the continuing operations before

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LETTER FROM THE BOARD

taxation of Emerson was US$8,803,000 (equivalent to approximately HK$68,663,000) for the year ended 31 March 2005 (2004: US$2,210,000 (equivalent to approximately HK$17,238,000)).

According to the Form 10-Q (Quarterly report for the quarter ended 30 June 2005) filed by Emerson to SEC, the unaudited net asset value of Emerson as at 30 June 2005 was US$53,725,000 (equivalent to approximately HK$419,055,000). The unaudited net profit after taxation of Emerson for the three months ended 30 June 2005 was US$415,000 (equivalent to approximately HK$3,237,000). The unaudited net profit before taxation of Emerson for the three months ended 30 June 2005 was US$477,000 (equivalent to approximately HK$3,720,000).

According to the Form 10-Q (Quarterly report for the quarter ended 30 June 2005), the value of the Sale Shares was approximately US$19,878,000 (equivalent to approximately HK$155,048,000), representing 37% of the net asset value of Emerson as at 30 June 2005.

(4) Sale Consideration:

The Sale Consideration payable by the Purchaser under the S&P Agreement is US$52 million. The Sale Consideration was arrived by the parties to the S&P Agreement with reference to the unaudited net asset value of Emerson as at 30 June 2005 which amounted to US$53.7 million as stated in the Form 10Q (Quarterly report) together with a valuation of the trademarks of US$59.8 million. Taking into account of the above valuation of the trademarks of US$59.8 million, the value attributable to the Sale Shares was approximately US$42 million. The Sale Consideration represents a premium of approximately US$10 million over the above value attributable to the Sale Shares. Such premium is resulted from taking into account of the fact that the Vendor, being the single major shareholder in Emerson, agreeing to sell his entire interests in Emerson in one block of shares whereas there are no other such single major shareholder in Emerson holding more than 5%. Besides, the Acquisition of the Sale Shares in one block can save time to purchase the same portion of shares on market from time to time. The valuation was undertaken by Emerson on behalf of its banks in agreeing its renewed bank financing and is on a basis of fair market value for the “Emerson” and “H.H.Scott” trademarks. The valuation of trademarks is not reflected in the net asset value of Emerson as at 30 June 2005 as stated above.

The Company believes that the premium over the value of Sale Shares is fair and reasonable.

The Sale Consideration shall be satisfied as to (i) US$26 million in cash by bank draft or telegraphic transfer and (ii) the balance of US$26 million in the form of the Convertible Debenture on the Completion Date.

Major terms of the Convertible Debenture

• (i) Issuer: The Company

• (ii) Principal amount: US$26 million

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LETTER FROM THE BOARD

(iii) Interest Rate:

No interest for the period from the Issue Date to the day prior to the first anniversary of the Issue Date and 3% per annum for the period from the first anniversary of the Issue Date until the Maturity Date.

(iv) Maturity Date: The third anniversary of the Issue Date

(v) Conversion:

The Debentureholder shall have the right to convert, on any Business Day prior to five (5) Business Days prior to the third anniversary of the issue date of the Convertible Debenture, the whole or part of the principal amount of the Convertible Debenture into Shares provided that such part of the principal amount of the Convertible Debenture to be converted shall not be less than Hong Kong dollar equivalent to US$5 million and shall be in a multiple of US$1 million.

(vi) Conversion Price:

HK$7.16 per Share, subject to adjustments pursuant to the conditions of the Convertible Debenture (“Conversion Price”). This represents the average closing price per Share of the Company’s Shares traded on HKSE for a period of twenty (20) trading days prior to the date of the S&P Agreement, a premium of approximately 13.7% over the closing price of HK$6.3 per Share as quoted on HKSE as at the Latest Practicable Date and a premium of approximately 13.7% over the average closing price of HK$6.3 per Share as quoted on HKSE for the five trading days immediately prior to the Latest Practicable Date. Based on the Conversion Price of HK$7.16, a total number of 28,324,022 Conversion Shares will be allotted and issued upon full exercise of the conversion rights attached to the Convertible Debenture which represent approximately 6.2% of the then issued share capital of the Company and approximately 5.8% of the then enlarged issued share capital of the Company.

(vii) Transferability:

Transferable only with the prior approval of any authority under any applicable laws and regulations and if transferred to a connected person (as defined in the Listing Rules), such transfer shall be made subject to compliance with the Listing Rules.

(viii) Redemption:

The Company shall have the right to early redeem the whole or part of the outstanding principal amount of the Convertible Debenture.

(ix) Voting right:

The Debentureholder shall not be entitled to receive notices of, attend or vote at any meetings of the Company by reason only of it being the Debentureholder.

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LETTER FROM THE BOARD

(5) Conditions:

The obligations of the Purchaser and the Vendor to complete the S&P Agreement is conditional upon the satisfaction of the conditions (any of which may be waived by the Purchaser/the Vendor) including:

1. there shall have been no material breach of any representation, warranty or undertaking under the S&P Agreement by the Purchaser or the Vendor;

2. the HKSE granting its approval for the listing of, and permission to deal in, any shares of par value of HK$0.10 in the share capital of the Company issuable thereby upon the exercise of the conversion right under the Convertible Debenture;

3. if required, the Bermuda Monetary Authority granting its permission for the issue of the Convertible Debenture and the free transferability of the Conversion Shares which may fall to be issued on conversion in full of the Convertible Debenture;

4. since the date of the S&P Agreement, there shall have been no material adverse change with respect to Emerson;

5. the Sale Shares represent approximately 37% of the issued and outstanding shares of Emerson on a fully-diluted basis; and

6. the securities to be issued pursuant to the Convertible Debenture, assuming full conversion thereof on the date of completion of the S&P Agreement, would represent approximately 6% of the issued and outstanding shares of the Company on a fully-diluted basis and the Company has sufficient shareholders’ mandate to allot and issue the securities convertible under the Convertible Debenture in compliance with the Listing Rules.

(6) Completion:

Completion of the Acquisition shall take place on the third Business Day after the fulfillment of the relevant conditions under the S&P Agreement or such other dates as otherwise agreed by the relevant parties.

The Sale Shares shall be sold free from all liens, charges and encumbrances and together with all rights now or hereinafter attaching to them, including all rights to any dividend or other distribution declared, made or paid after the Completion Date.

INFORMATION ON THE VENDOR

The Directors confirm that, to the best of the Directors’ knowledge, information and belief and having made all reasonable enquiries, the Vendor, being the ultimate beneficial owner of Emerson, is a third party independent of the Company and connected persons (as defined in the Listing Rules) of the Company.

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LETTER FROM THE BOARD

Emerson, a Delaware corporation, is principally engaged in the consumer electronics industry. Emerson designs, sources, imports and markets a variety of consumer electronics products and licenses its trademarks for a variety of products worldwide.

REASONS FOR THE ACQUISITION

The Group is principally engaged in the design, development, manufacture and distribution of electronic and computer products and components along with trading of audio & video products and shares.

The reason of the Acquisition is to gain a share in a prominent entry level consumer electronics brand in the US and increase the Company’s share of the consumer electronic market in the US. The Company will gain increased turnover and contribution due to the synergy of business in the Far East in respect of the manufacturing and sourcing of products.

The Board considers that the terms of the S&P Agreement, which were arrived at after arm’s length negotiations among the Company, the Purchaser, the Vendor and Emerson, are fair and reasonable and that the S&P Agreement is in the interests of the Company and the Shareholders as a whole.

IMPLICATION UNDER THE LISTING RULES AND REASONS FOR RECLASSIFICATION OF THE ACQUISITION TO A DISCLOSEABLE TRANSACTION

As stated in the First Announcement, the Company expected to obtain control of the board of directors of Emerson as the Company managed to orally agree with 3 existing directors of Emerson that they would retire and nominate 3 representatives of the Company as new executive directors of Emerson at the forthcoming general meeting of Emerson. Accordingly, the Company would have 3 representatives out of a total of 5 members (being 3 executive directors and 2 independent directors) on the board of directors of Emerson after completion of the Acquisition and before the end of this year. The Company would therefore be required to classify Emerson as a subsidiary and to consolidate the accounts of Emerson with the Company’s accounts in accordance with HKFRS.

Subsequent to the signing of the S&P Agreement, the management of the Company (including Mr. Michael A. B. Binney) further discussed this matter with the management of Emerson (including the Vendor – Mr. Gottfried Ludwig Prentice Jurick) and consulted its US legal advisors in respect of the composition of the board of directors of Emerson. The management of the Company now realises that pursuant to the applicable American Stock Exchange corporate governance requirements, the board of directors of Emerson must be comprised of a majority of independent directors.

The management of the Company and the Vendor now intend that the board of directors of Emerson after completion of the Acquisition will comprise 2 executive directors who are representatives of the Company and 3 independent directors. As such, the Company will not have a majority control of the board of directors of Emerson and hence will not classify Emerson as a subsidiary or to consolidate the accounts of Emerson into those of the Company under HKFRS.

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LETTER FROM THE BOARD

Based on the 37% interest in Emerson to be owned by the Company upon completion of the Acquisition, Emerson will be classified as an associate of the Company and recorded using the equity method of accounting in the accounts of the Group under HKFRS. The Group’s share of the postacquisition results and reserves of Emerson will be included in the consolidated income statement and consolidated reserves of the Group respectively. The Group’s investment in Emerson will be stated in the consolidated balance sheet at the Group’s share of the net assets of Emerson, less any identified impairment loss.

As a result of the above, based on the relevant percentage ratios (as defined in the Listing Rules) of the Acquisition, the Acquisition constitutes a discloseable transaction instead of a major transaction of the Company pursuant to Chapter 14 of the Listing Rules. The Second Announcement was published on newspapers to explain the aforesaid change of category of the transaction. Further, as a discloseable transaction of the Company, no Shareholders’ approval in respect of the Acquisition is required pursuant to the Listing Rules.

GENERAL MANDATE

The maximum number of Conversion Shares which may be issued upon conversion of the Convertible Debenture based on the Conversion Price of HK$7.16 is 28,324,022 Conversion Shares representing 6.2% of the then issued share capital of the Company and approximately 5.8% of the then enlarged issued share capital of the Company. The Conversion Shares will be issued pursuant to the General Mandate.

GENERAL

No application will be made for listing of, or permission to deal in, the Convertible Debenture on the HKSE or any other stock exchange. An application will be made to the Listing Committee of the HKSE for the listing of, and permission to deal in, 28,324,022 Conversion Shares to be issued upon full conversion of the Convertible Debentures.

The First Announcement and the Second Announcement were for information purpose but do not constitute an invitation or offer to acquire, purchase or subscribe for the share capital of Emerson or the Shares or Convertible Debenture of the Company.

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in Appendix (General Information) to this circular.

For and on behalf of the Board

Christopher W. Ho

Chairman

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GENERAL INFORMATION

APPENDIX

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement herein misleading.

1. SHARE CAPITAL

The authorised and issued share capital of the Company as at the Latest Practicable Date were as follows:

Number of ordinary shares of HK$0.10 each

Number of ordinary shares of HK$0.10 each HK$ Authorised: 100,000,000

1,000,000,000 Shares

Issued and fully paid:

460,277,320 Shares

46,027,732

2. DISCLOSURE OF INTERESTS BY DIRECTORS

As at Latest Practicable Date, the interests of the Directors and chief executives of the Company in the shares and underlying shares of the Company or its associated corporations, if any, (within the meaning of Part XV of the SFO) which were required to be notified to the Company and HKSE pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was deemed or taken 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, to be notified to the Company and HKSE were as follows:

Long positions in shares:

		Number of issued	Percentage of the
Directors	Capacity	Shares held	issued share capital
Mr. Christopher W. Ho	Interest in corporation	289,123,822*	62.82%
Mr. C. F. Lam	Beneficial owner	303,600	0.07%
Mr. Adrian C. C. Ma	Beneficial owner	78,000	0.02%

• Mr. Christopher W. Ho had a 100% deemed beneficial interest in The Grande International Holdings Limited which owned 289,123,822 Shares in the Company through its wholly owned subsidiary, Barrican Investments Corporation.

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GENERAL INFORMATION

APPENDIX

Save as disclosed above, as at Latest Practicable Date, none of the Directors and Chief Executives of the Company had registered any interest or short position in the shares, underlying shares or debentures of the Company or any of its associated corporations, if any, (within the meaning of Part XV of the SFO) which were required to be notified to the Company and HKSE pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was deemed or taken 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, to be notified to the Company and HKSE.

3. DISCLOSURE OF INTERESTS BY SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as is known to any Director or Chief Executive of the Company, the following persons (other than the Directors or Chief Executive of the Company) had, or were deemed or taken to have interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company and HKSE under the provisions of Division 2 and 3 of Part XV of the SFO or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had any option in respect of such capital:

Name of Substantial	Number of	Percentage of issued
Shareholder	Shares interested	share capital
Mr. Christopher W. Ho	289,123,822#	62.82%
Barrican Investments Corporation	289,123,822#	62.82%
Mr. Lawrence Y. L. Ho	24,986,000*	5.42%
J. P. Morgan Chase & Co.	24,300,000	5.28%
Morgan Stanley	23,126,000	5.03%

Notes:

• Mr. Christopher W. Ho had a 100% deemed beneficial interest in The Grande International Holdings Limited which owned 289,123,822 Shares in the Company through its wholly owned subsidiary, Barrican Investments Corporation.

• Mr. Lawrence Y. L. Ho owned 24,986,000 Shares in the Company through Grand Villa Assets Limited of which he has 100% control.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors knows of any person (other than the Directors or Chief Executive of the Company) who had, or were deemed or taken to have interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company and HKSE under the provisions of Division 2 and 3 of Part XV of the SFO or, who were, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had any option in respect of such capital.

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GENERAL INFORMATION

APPENDIX

4. EFFECT OF THE TRANSACTION TO THE GROUP

Based on the 37% interest in Emerson to be owned by the Company upon completion of the Acquisition, Emerson will be classified as an associate of the Company and recorded using the equity method of accounting in the accounts of the Group under HKFRS. The Group’s share of the postacquisition results and reserves of Emerson will be included in the consolidated income statement and consolidated reserves of the Group respectively. The Group’s investment in Emerson will be stated in the consolidated balance sheet at the Group’s share of the net assets of Emerson, less any identified impairment loss. Following the Completion, the Group’s non-current assets are expected to be increased by US$52 million (equivalent to approximately HK$406 million), the current assets are expected to be decreased by US$26 million (equivalent to approximately HK$203 million) and the non-current liabilities are expected to be increased by US$26 million (equivalent to approximately HK$203 million).

5. COMPETING INTERESTS OF DIRECTORS

As at the Latest Practicable Date, none of the directors or their associates is considered to have interests in a business which competes or is likely to compete, either directly or indirectly, with the businesses of the Group, as defined in the Listing Rules.

6. DIRECTORS’ EXISTING OR PROPOSED CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with the Company or any member of the Group which is not expiring or determinable by the Company within one year without payment of compensation other than statutory compensation.

7. LITIGATION

As at the Latest Practicable Date, none of the members of the Group is engaged in any litigation or claims of material importance and no litigation or claims of material important is known to the Directors or the Company to be pending or threatened by or against any member of the Group.

8. COMPANY SECRETARY AND QUALIFIED ACCOUNTANT

The Secretary and qualified accountant of the Company, Mr. Michael Andrew Barclay Binney, is a fellow member of the Institute of Certified Accountants in England and Wales and a Fellow Member of the Hong Kong Institute of Certified Public Accountants.

9. REGISTERED OFFICE, HEAD OFFICE AND TRANSFER OFFICE

• (a) The registered office of the Company is situated at 2 Reid Street, Hamilton HM11, Bermuda.

• (b) The head office of the Company is situated at 12th Floor, The Grande Building, 398 Kwun Tong Road, Kowloon, Hong Kong.

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GENERAL INFORMATION

APPENDIX

• (c) The Company’s branch share registrar and transfer office in Hong Kong is Tengis Limited at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong.

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