Ficus Technology Holdings Limited — M&A Activity 2023

Jul 21, 2023

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this joint announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this joint announcement.

This joint announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of Vision International Holdings Limited, nor is it a solicitation of any vote or approval in any jurisdiction. This joint announcement is not for release, publication or distribution into any jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction.

Mr. Lau Chi Wing James 劉志 榮 先生

Vision International Holdings Limited 威誠國際控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8107)

JOINT ANNOUNCEMENT

(1) CONDITIONAL AGREEMENT IN RELATION TO THE TRANSFER OF 56.82% OF THE SHARES OF VISION INTERNATIONAL HOLDINGS LIMITED;

(2) POSSIBLE MANDATORY UNCONDITIONAL CASH OFFER BY QUAM SECURITIES LIMITED FOR AND ON BEHALF OF LAU CHI WING JAMES TO ACQUIRE ALL OF THE ISSUED SHARES IN THE ISSUED SHARE CAPITAL OF

VISION INTERNATIONAL HOLDINGS LIMITED

(OTHER THAN THOSE SHARES ALREADY OWNED OR AGREED TO BE ACQUIRED BY LAU CHI WING JAMES AND PARTIES ACTING IN CONCERT WITH HIM); AND (3) RESUMPTION OF TRADING

Financial adviser to the Offeror Offer Agent to the Offeror

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–1–

BACKGROUND

On23December2022,theVendor(asborrower),theLenderandMr.Ko(asguarantor)
enteredintotheLoanAgreement.PursuanttotheLoanAgreement,amongothers,(i)the
VendorrequestedandtheLenderagreedtomakeavailabletotheVendortheLoaninthe
principalamountofHK$52,500,000ataninterestrateof8%perannumwhichwastobe
advancedbytheFirstDrawdownofHK$20,300,000andtheSecondDrawdownof
HK$32,200,000;(ii)theVendorcharged75,000,000Shares,representingapproximately
56.82%ofthetotalissuedsharecapitaloftheCompanyasatthedateofthisjoint
announcement,totheLender(i.e.theShareCharge)assecurityfortherepaymentofthe
LoanbytheVendor;and(iii)Mr.KoprovidedthePersonalGuaranteetotheLenderto
guaranteetherepaymentoftheLoanbytheVendor.TheLoanwithallinterestaccrued
thereonisdueandpayableon29June2024.Mr.Ko,throughtheVendor,hadtakenout
theLoantosupporthispersonalaffairs.TheVendorisacompanywholly-ownedbyMr.
Ko,thechairmanandanexecutiveDirectoroftheCompany.

On29December2022,theOfferor,forandonbehalfoftheLender,advancedtheFirst
DrawdowntotheVendorpursuanttotheLoanAgreement.On30May2023,theVendor
(asborrower),theLenderandMr.Ko(asguarantor)enteredintotheSupplementalLoan
AgreementtoamendthedatefortheSecondDrawdownfrom29June2023to30May
2023andtheOfferor,forandonbehalfoftheLender,advancedtheSecondDrawdownto
theVendoronthesamedate.

ThefundsfortheFirstDrawdownandSecondDrawdownwerecontributedsolelybythe
Offeror.

TheLenderwasoriginallyincorporatedasabusinessventureinprovidingfinancingtothe
Vendor,buteventuallythisbusinessventurewassolelyundertakenbytheOfferorhimself
withoutanyfinancialcontributionfromothershareholdersoftheLender.Exceptfor
enteringintotheLoanAgreementandtheSupplementalLoanAgreement,theLenderhas
notengagedinanybusinessactivitiessinceitsincorporation.Asconfirmedbythe
Offeror,itwasresolvedbymajorityoftheshareholdersthattheLendershallbedissolved
uponcompletionoftheShareTransferAgreement(i.e.settlementoftheLoan).

THE SHARE TRANSFER AGREEMENT

TheBoardhasbeeninformedthataftertradinghourson10July2023,theVendorandthe
OfferorenteredintotheShareTransferAgreement,pursuanttowhichtheVendor
conditionallyagreedtosellandtransfer,andtheOfferorconditionallyagreedtopurchase,
theSaleSharesfreefromallencumbrancesforacashConsiderationofHK$57,725,952,
equivalenttoapproximatelyHK$0.7697perSaleShare,whichwillbesatisfiedbywayof
offsettingtheentireprincipalamountoftheLoanofHK$52,500,000(whichwasadvanced
bytheOfferor,forandonbehalfoftheLender,totheVendorintheformofFirst
DrawdownandSecondDrawdown)andtheinterestofHK$5,225,952payableforthe
LoantermagainsttheConsideration.TheSaleShares,beingthe75,000,000Sharesunder
theShareCharge,representapproximately56.82%ofthetotalissuedsharecapitalofthe
Companyasatthedateofthisjointannouncement.

–2–

InJune2023,theOfferorwasinformedbyMr.Ko,beingthesoleshareholderofthe
Vendor,thattakingintoconsiderationhisavailablefinancialresourcesandforeseeable
cashinflow,Mr.KoanticipatedthattheVendorwouldencounterdifficultyinmaking
continuousrepaymentofinterestsaswellastheprincipalamountoftheLoaninthe
foreseeablefuture.Assuch,Mr.KoproposedtosettletheoutstandingsumundertheLoan
inanexpeditiousandamicablemannerviaofferingtheOfferortotakeuptheSaleShares,
giventhatMr.KohasallalongperceivedtheLoanasasignofpersonalsupportbythe
Offeror,beingaseniorandestablishedbusinessmanintheapparelandgarmentindustry,
tohimasayoungerfellowbusinessmaninthesameindustry.Havingconsideredthe
valueoftheGroupandinordertoprotecttheOfferor’sowninterest,theOfferoragreed
tonegotiatewiththeVendoronthosearrangementscontemplatedundertheShare
TransferAgreement.

Asatthedateofthisjointannouncement,allconditionsprecedentundertheShare
TransferAgreementhavebeenfulfilledandsatisfied.PursuanttotheShareTransfer
Agreement,theCompletionDateshalltakeplaceonorbeforetheBusinessDayafterall
theconditionstoCompletionpursuanttotheShareTransferAgreementhavebeen
fulfilled,or,whereapplicable,waivedbytheOfferororsuchotherdateastheVendorand
theOfferormayagreeinwriting.Asatthedateofthisjointannouncement,theVendor
andtheOfferorhaveagreedinwritingthatCompletionshalltakeplacewithintwo(2)
BusinessDaysfollowingthepublicationofthisjointannouncement.

POSSIBLE MANDATORY UNCONDITIONAL CASH OFFER

AsatthedateofthisjointannouncementandpriortoCompletion,savefortheShare
Charge,theOfferorandpartiesactinginconcertwithhimdidnotown,controlorhave
directionoveranySharesorotherrelevantsecurities(asdefinedinNote4toRule22of
theTakeoversCode)oftheCompany.ImmediatelyfollowingCompletion,theOfferorand
partiesactinginconcertwithhimwillown75,000,000Shares,representing56.82%ofthe
totalissuedsharecapitaloftheCompanyasatthedateofthisjointannouncement.The
Offerorwilltherefore,subjecttoanduponCompletion,berequiredunderRule26.1ofthe
TakeoversCodetomakeanOfferforalltheissuedSharesnotalreadyownedoragreedto
beacquiredbytheOfferorandpartiesactinginconcertwithhim.TheOfferwillbemade
totheIndependentShareholders.

Asatthedateofthisjointannouncement,theCompanyhas132,000,000Sharesinissue
andtheCompanyhasnootheroutstandingShares,options,warrants,derivativesorother
securitiesthatareconvertibleorexchangeableintoSharesorotherrelevantsecuritiesin
theCompany(asdefinedinNote4toRule22oftheTakeoversCode).

SubjecttoCompletion,QuamSecuritieswillmaketheOfferonbehalfoftheOfferoron
thefollowingbasis:

Offer Price for each Offer Share . . . . . . . . . . . . . . . . . . . . . . . . . . HK$2.18 in cash

–3–

TheOfferPriceisHK$2.18perOfferShare.Asatthedateofthisjointannouncement,
theLenderisownedasto40.0%bytheOfferor,20.1%byMs.ChoiManYunMarian,
13.3%byMs.KongLaiYing,13.3%byMr.ChenManLungand13.3%byMs.Chung
TungLaiFiona.TheOfferorisconsideredtobeactinginconcertwiththeother
shareholdersoftheLenderundertheTakeoversCode.

In anticipation of the requirement to make the Offer after signing of the Share Transfer Agreement, the Offeror has, for prudence’s sake, made enquiries with all other shareholders of the Lender as to any dealings in the Shares by them and/or their associates during the six months prior to the commencement of the Offer Period. In this regard, Ms. Kong Lai Ying (‘‘ Ms. Kong ’’) who holds 13.3% of the issued share capital of the Lender indicated that her son had acquired certain Shares during the six months prior to the commencement of the Offer Period and the highest price paid was HK$2.18 per Share. Although the funds for the First Drawdown and Second Drawdown were contributed solely by the Offeror and Ms. Kong’s son is not a party acting in concert with the Offeror in relation to the Lender or the Company, the Offeror has considered the need to ensure the perception of fair and equal treatment to all Shareholders, and hence decided to make the Offer at the price of HK$2.18 per Offer Share, instead of the price he would pay for each Sale Share (i.e. HK$0.7697).

AssumingthatthereisnochangeintheissuedsharecapitaloftheCompanyandbasedon
theOfferPriceofHK$2.18perOfferShare,thetotalissuedsharecapitaloftheCompany
isvaluedatHK$287,760,000.AstheOfferorandpartiesactinginconcertwithhimwill
holdinaggregate75,000,000SharesimmediatelyafterCompletion,57,000,000Shares
willbesubjecttotheOffer.BasedontheOfferPriceofHK$2.18perOfferShare,the
considerationoftheOfferwouldbeHK$124,260,000.PrincipaltermsoftheOfferareset
outinthesectionheaded‘‘PossibleMandatoryUnconditionalCashOffer’’inthisjoint
announcement.

TheOfferorintendstosatisfytheconsiderationpayableundertheOfferbytheOffer
FacilityofuptoHK$130.0milliongrantedtohimbyQuamSecurities.TheOfferFacility
issecuredby(i)theOfferFacilityShareChargegivenbytheOfferorinfavourofQuam
Securities;and(ii)acashcollateralintheamountofHK$3,000,000.

GrandeCapital,asthefinancialadvisertotheOfferorinrespectoftheOffer,issatisfied
thatsufficientfinancialresourcesare,andwillremain,availabletotheOfferortosatisfy
theamountoffundsrequiredforfullacceptanceoftheOffer.TheOfferorintendsto
maintainthelistingoftheSharesontheStockExchangefollowingthecloseoftheOffer.

–4–

INDEPENDENT BOARD COMMITTEE AND INDEPENDENT FINANCIAL ADVISER

TheIndependentBoardCommitteecomprisingalltheindependentnon-executive
DirectorswhohavenodirectorindirectinterestintheOffer,namelyMr.ToKingYan,
Adam,Mr.KwokCheeKinandMr.ChanKimSun,willbeestablishedpursuanttoRule
2.1oftheTakeoversCodetoadvisetheIndependentShareholdersastowhethertheterms
oftheOfferarefairandreasonableandwhethertheOfferisintheinterestsofthe
IndependentShareholdersasawholeandastotheacceptanceoftheOffer.
TheIndependentFinancialAdviserwillbeappointedwiththeapprovaloftheIndependent
BoardCommitteetoadvisetheIndependentBoardCommitteeandtheIndependent
ShareholdersinrespectoftheOfferand,inparticular,astowhetherthetermsofthe
OfferarefairandreasonableandastotheacceptanceoftheOffer.Further
announcement(s)willbemadebytheCompanyupontheappointmentoftheIndependent
FinancialAdviser.TheadviceoftheIndependentFinancialAdviserandthe
recommendationsoftheIndependentBoardCommitteewillbeincludedintheComposite
DocumenttobedespatchedtotheShareholders.

DESPATCH OF THE COMPOSITE DOCUMENT

ItistheintentionoftheOfferorandtheCompanytocombinetheofferdocumentandthe
offeree’sboardcircularintheCompositeDocumenttobeposted.PursuanttoRule8.2of
theTakeoversCode,theCompositeDocumentsettingout,amongothers,(i)further
detailsoftheOffer;(ii)therecommendationfromtheIndependentBoardCommittee;(iii)
aletterofadvicefromtheIndependentFinancialAdvisertotheIndependentBoard
CommitteeandtheIndependentShareholdersinrespectofthetermsoftheOfferandasto
theacceptanceoftheOffer;and(iv)therelevantform(s)ofacceptanceandtransfer,will
bedespatchedtotheShareholderswithin21daysafterthedateofthisjointannouncement
orsuchlaterdateastheExecutivemayapprove.Furtherannouncement(s)regardingthe
despatchoftheCompositeDocumentwillbemadebytheOfferorandtheCompanyas
andwhenappropriate.

TRADING HALT AND RESUMPTION OF TRADING IN THE SHARES

AttherequestoftheCompany,tradingintheSharesontheStockExchangewashalted
witheffectfrom9:00a.m.on11July2023pendingthereleaseofthisjoint
announcement.ApplicationhasbeenmadebytheCompanyforresumptionoftradingin
theSharesontheStockExchangewitheffectfrom1:00p.m.on21July2023.

–5–

WARNING

Shareholders and potential investors should note that the Offer is a possible mandatory unconditional cash offer and will only be made if Completion takes place. The Independent Board Committee has yet to consider and evaluate the Offer. This joint announcement is made in compliance with the Takeovers Code for the purpose of, amongst other things, informing Shareholders of the fact that the Company has been informed that the Offer will be made if Completion takes place. The Directors make no recommendation as to the fairness or reasonableness of the Offer or as to the acceptance of the Offer in this joint announcement.

Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares. A further announcement will be made by the Offeror and the Company when Completion takes place. If Shareholders and potential investors are in any doubt about their position, they should consult their professional advisers.

BACKGROUND

On23December2022,theVendor(asborrower),theLender(aslender)andMr.Ko(as
guarantor)enteredintotheLoanAgreement.PursuanttotheLoanAgreement,amongothers,
(i)theVendorrequestedandtheLenderagreedtomakeavailabletotheVendortheLoanin
theprincipalamountofHK$52,500,000ataninterestrateof8%perannumwhichwastobe
advancedbytheFirstDrawdownofHK$20,300,000andtheSecondDrawdownof
HK$32,200,000;(ii)theVendorcharged75,000,000Shares,representingapproximately
56.82%ofthetotalissuedsharecapitaloftheCompanyasatthedateofthisjoint
announcement,totheLender(i.e.theShareCharge)assecurityfortherepaymentofthe
LoanbytheVendor;and(iii)Mr.KoprovidedthePersonalGuaranteetotheLenderto
guaranteetherepaymentoftheLoanbytheVendor.TheLoanwithallinterestaccrued
thereonisdueandpayableon29June2024.Mr.Ko,throughtheVendor,hadtakenoutthe
Loantosupporthisotherpersonalaffairs.TheVendorisacompanywholly-ownedbyMr.
Ko,thechairmanandanexecutiveDirectoroftheCompany.

On29December2022,theOfferor,forandonbehalfoftheLender,advancedtheFirst
DrawdowntotheVendorpursuanttotheLoanAgreement.On30May2023,theVendor(as
borrower),theLenderandMr.Ko(asguarantor)enteredintotheSupplementalLoan
AgreementtoamendthedatefortheSecondDrawdownfrom29June2023to30May2023
andtheOfferor,forandonbehalfoftheLender,advancedtheSecondDrawdowntothe
Vendoronthesamedate.

ThefundsfortheFirstDrawdownandSecondDrawdownwerecontributedsolelybythe
Offeror.

TheLenderwasoriginallyincorporatedasabusinessventureinprovidingfinancingtothe
Vendor,buteventuallythisbusinessventurewassolelyundertakenbytheOfferorhimself
withoutanyfinancialcontributionfromothershareholdersoftheLender.Exceptfor
enteringintotheLoanAgreementandtheSupplementalLoanAgreement,theLenderhas

–6–

notengagedinanybusinessactivitiessinceitsincorporation.AsconfirmedbytheOfferor,
itwasresolvedbymajorityoftheshareholdersthattheLendershallbedissolvedupon
completionoftheShareTransferAgreement(i.e.settlementoftheLoan).

THE SHARE TRANSFER AGREEMENT

TheBoardhasbeeninformedthataftertradinghourson10July2023,theVendorandthe
OfferorenteredintotheShareTransferAgreement,pursuanttowhichtheVendor
conditionallyagreedtosellandtransfer,andtheOfferorconditionallyagreedtopurchase,
theSaleSharesfreefromallencumbrancesforacashConsiderationofHK$57,725,952,
equivalenttoapproximatelyHK$0.7697perSaleShare,whichwillbesatisfiedbywayof
offsettingtheentireprincipalamountoftheLoanofHK$52,500,000(whichwasadvanced
bytheOfferor,forandonbehalfoftheLender,totheVendorintheformofFirst
DrawdownandSecondDrawdown)andtheinterestofHK$5,225,952payablefortheLoan
termagainsttheConsideration.TheSaleShares,beingthe75,000,000Sharesunderthe
ShareCharge,representapproximately56.82%ofthetotalissuedsharecapitalofthe
Companyasatthedateofthisjointannouncement.

InJune2023,theOfferorwasinformedbyMr.Ko,beingthesoleshareholderofthe
Vendor,thattakingintoconsiderationhisavailablefinancialresourcesandforeseeablecash
inflow,Mr.KoanticipatedthattheVendorwouldencounterdifficultyinmakingcontinuous
repaymentofinterestsaswellastheprincipalamountoftheLoanintheforeseeablefuture.
Assuch,Mr.KoproposedtosettletheoutstandingsumundertheLoaninanexpeditious
andamicablemannerviaofferingtheOfferortotakeuptheSaleShares,giventhatMr.Ko
hasallalongperceivedtheLoanasasignofpersonalsupportbytheOfferor,beingasenior
andestablishedbusinessmanintheapparelandgarmentindustry,tohimasayoungerfellow
businessmaninthesameindustry.HavingconsideredthevalueoftheGroupandinorderto
protecttheOfferor’sowninterest,theOfferoragreedtonegotiatewiththeVendoronthose
arrangementscontemplatedundertheShareTransferAgreement.

SetoutbelowaretheprincipaltermsoftheShareTransferAgreement.

Date

10July2023

Parties

• (i) the Vendor (as the vendor of the Sale Shares); and

• (ii) the Offeror (as the purchaser of the Sale Shares).

TheOfferorandpartiesactinginconcertwithhimarethirdpartiesindependentof,andnot
connectedwith,eithertheCompanyoranyofitsconnectedpersons.

–7–

Subject matter

PursuanttotheShareTransferAgreement,theVendorconditionallyagreedtoselland
transfer,andtheOfferorconditionallyagreedtopurchase,theSaleShares,beingthe
75,000,000SharesundertheShareChargeandrepresentingapproximately56.82%ofthe
totalissuedsharecapitaloftheCompanyasatthedateofthisjointannouncement,fora
ConsiderationofHK$57,725,952,equivalenttoapproximatelyHK$0.7697perSaleShare.

TheSaleSharesaresoldfreefromallencumbrancesandwithallrightsattachedtheretoor
accruingthereto,includingbutnotlimitedtoalldividends,distributionsandpayments
declared,paidormadeinrespectthereofonorafterthedateoftheShareTransfer
Agreement.TheSaleSharesrepresenttheentireholdingofSharesbytheVendor
immediatelypriortotheenteringintooftheShareTransferAgreement.

The Consideration

TheConsiderationforthesaleandpurchaseoftheSaleSharesisHK$57,725,952,
equivalenttoapproximatelyHK$0.7697perSaleShare,whichwasagreedbetweenthe
VendorandtheOfferorafterarm’slengthnegotiations,takingintoaccounttheentire
principalamountoftheLoanofHK$52,500,000(whichwasadvancedbytheOfferor,for
andonbehalfoftheLender,totheVendorintheformofFirstDrawdownandSecond
Drawdown)andtheinterestofHK$5,225,952payablefortheLoanterm.

TheConsiderationwillbesatisfiedbywayofoffsettingtheentireprincipalamountofthe
LoanofHK$52,500,000andtheinterestofHK$5,225,952payablefortheLoantermagainst
theConsideration.

Conditions of the Share Transfer Agreement

Completionissubjecttoandconditionaluponthefollowingconditionsbeingsatisfied
unlessspecificallywaivedbytheOfferorinwriting:

• (a) the Shares remaining listed and traded on GEM, and no notification or indication being received from the Stock Exchange or the SFC prior to Completion that the listing and/or trading of the Shares on GEM will or may be, for whatever reason, withdrawn or suspended (excluding any suspension for the purpose of obtaining clearance from the SFC or the Stock Exchange for this joint announcement and other announcements relating to, among other things, the transactions contemplated under the Share Transfer Agreement);

• (b) all other necessary waivers, consents and approvals (if required) from the relevant governmental or regulatory authorities or any other third parties required for the Share Transfer Agreement and the transactions contemplated thereunder being obtained;

• (c) the Stock Exchange and the Executive having advised that they have no further comment on this joint announcement, the Offer and the publication of this joint announcement on the Stock Exchange’s website; and

• (d) the representations, warranties and indemnities given by the Vendor under the Share Transfer Agreement remaining true, accurate and not misleading in any respect.

–8–

Inrelationtotheconditionsetoutinparagraph(b)above,theDirectorsconfirmthat,save
for(i)approvalsbytheboardofdirectorsoftheVendorwhichhavebeenobtainedasatthe
dateofthisjointannouncement;and(ii)theclearance(s)fromtheStockExchangeandthe
ExecutivepursuanttotheGEMListingRulesandtheTakeoversCodeinconnectionwith
thepublicationofthisjointannouncement,nootherwaiver,consentorapprovalis
consideredtobenecessary,onthepartoftheVendorandtheOfferor,fororinconnection
withthetransactionscontemplatedundertheShareTransferAgreement.

Inrelationtotheconditionsetoutinparagraph(d)above,pursuanttotheShareTransfer
Agreement,thewarrantiesmainlyrelatetotheVendor’sauthority,capacityandtitletothe
SaleShareswhiletheotherwarrantiesrelatetotheaffairsoftheGroup.

Exceptfortheconditionssetoutinparagraphs(b)and(c)abovewhichconcernthe
obtainingoftheapproval,waiverorconsentoftheExecutiveortheStockExchangewhich
isnotcapabletobewaivedbyanypartiestotheShareTransferAgreement,theOfferormay
waiveanyoftheclosingconditionstotheextentpermittedathisabsolutediscretion.Ifany
oftheconditionssetoutaboveisnotsatisfied,orwhereapplicable,waived,ontheLong
StopDate,theShareTransferAgreementshallceaseanddetermine(saveandexceptthe
survivingprovisionsinrelationtorescission,confidentialityandannouncements,noticeand
processagents,costsandstampdutyandgoverninglawandjurisdictionclauseswhichshall
continuetohavefullforceandeffect),andneitherpartyshallhaveanyfurtherobligations
andliabilitiesundertheShareTransferAgreementandneitherpartyshalltakeanyactionto
claimfordamagesortoenforcespecificperformanceoranyotherrightsandremediessave
foranyrightsaccruedtoanypartiesinrespectofanyantecedentbreachesoftheterms
thereof.

Asatthedateofthisjointannouncement,allconditionsabovehavebeenfulfilledand
satisfied.PursuanttotheShareTransferAgreement,theCompletionDateshalltakeplaceon
orbeforetheBusinessDayafteralltheconditionstoCompletionpursuanttotheShare
TransferAgreementhavebeenfulfilled,or,whereapplicable,waivedbytheOfferororsuch
otherdateastheVendorandtheOfferormayagreeinwriting.Asatthedateofthisjoint
announcement,theVendorandtheOfferorhaveagreedinwritingthatCompletionshalltake
placewithintwo(2)BusinessDaysfollowingthepublicationofthisjointannouncement.

Completion

Uponfulfilmentorwaiverofalltheconditionssetoutinthesectionheaded‘‘Conditionsof
theShareTransferAgreement’’inthisjointannouncement,Completionshalltakeplaceon
theCompletionDate.

–9–

POSSIBLE MANDATORY UNCONDITIONAL CASH OFFER

The Offer

AsatthedateofthisjointannouncementandpriortoCompletion,savefortheShare
Charge,theOfferorandpartiesactinginconcertwithhimdidnotown,controlorhave
directionoveranySharesorotherrelevantsecurities(asdefinedinNote4toRule22ofthe
TakeoversCode)oftheCompany.ImmediatelyfollowingCompletion,theOfferorand
partiesactinginconcertwithhimwillown75,000,000Shares,representing56.82%ofthe
totalissuedsharecapitaloftheCompanyasatthedateofthisjointannouncement.The
Offerorwilltherefore,subjecttoanduponCompletion,berequiredunderRule26.1ofthe
TakeoversCodetomakeanOfferforalltheissuedSharesnotalreadyownedoragreedto
beacquiredbytheOfferorandpartiesactinginconcertwithhim.TheOfferwillbemadeto
theIndependentShareholders.

Asatthedateofthisjointannouncement,theCompanyhas132,000,000Sharesinissueand
theCompanyhasnootheroutstandingShares,options,warrants,derivativesorother
securitiesthatareconvertibleorexchangeableintoSharesorotherrelevantsecuritiesinthe
Company(asdefinedinNote4toRule22oftheTakeoversCode).

SubjecttoCompletion,QuamSecuritieswillmaketheOfferonbehalfoftheOfferoronthe
followingbasis:

Offer Price for each Offer Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$2.18 in cash

TheOfferwillbeunconditionalinallrespectswhenitismade.

TheOfferPriceisHK$2.18perOfferShare.Asatthedateofthisjointannouncement,the
Lenderisownedasto40.0%bytheOfferor,20.1%byMs.ChoiManYunMarian,13.3%
byMs.KongLaiYing,13.3%byMr.ChenManLungand13.3%byMs.ChungTungLai
Fiona.TheOfferorisconsideredtobeactinginconcertwiththeothershareholdersofthe
LenderundertheTakeoversCode.

In anticipation of the requirement to make the Offer after signing of the Share Transfer Agreement, the Offeror has, for prudence’s sake, made enquiries with all other shareholders of the Lender as to any dealings in the Shares by them and/or their associates during the six months prior to the commencement of the Offer Period. In this regard, Ms. Kong Lai Ying (‘‘ Ms. Kong ’’) who holds 13.3% of the issued share capital of the Lender indicated that her son had acquired certain Shares during the six months prior to the commencement of the Offer Period and the highest price paid was HK$2.18 per Share. Although the funds for the First Drawdown and Second Drawdown were contributed solely by the Offeror and Ms. Kong’s son is not a party acting in concert with the Offeror in relation to the Lender or the Company, the Offeror has considered the need to ensure the perception of fair and equal treatment to all Shareholders, and hence decided to make the Offer at the price of HK$2.18 per Offer Share, instead of the price he would pay for each Sale Share (i.e. HK$0.7697).

–10–

AssumingthatthereisnochangeintheissuedsharecapitaloftheCompanyandbasedon
theOfferPriceofHK$2.18perOfferShare,thetotalissuedsharecapitaloftheCompanyis
valuedatHK$287,760,000.AstheOfferorandpartiesactinginconcertwithhimwillhold
inaggregate75,000,000SharesimmediatelyafterCompletion,57,000,000Shareswillbe
subjecttotheOffer.BasedontheOfferPriceofHK$2.18perOfferShare,theconsideration
oftheOfferwouldbeHK$124,260,000.TheOfferSharestobeacquiredundertheOffer
shallbefullypaidandfreefromallencumbranceandtogetherwithallrightsandbenefits
attachingtheretoasatthedateoftheCompositeDocumentorsubsequentlybecoming
attachedtothem,includingbutnotlimitedtotherighttoreceiveinfullalldividends,
distributionsandanyreturnofcapital,ifany,whichmaybemadeordeclaredoragreedto
bemadeordeclared,andtherecorddateofwhichfallsonorafterthedateonwhichthe
Offerismade,beingthedateofdespatchoftheCompositeDocument.

TheCompanyconfirmsthatasatthedateofthisjointannouncement,(i)ithasnotdeclared
anydividendwhichisnotyetpaid;and(ii)itdoesnothaveanyintentiontodeclareorpay
anyfuturedividendormakeotherdistributionspriortoandincludingthedateofclosingof
theOffer.If,afterthedateofthisjointannouncement,anydividendorotherdistributionis
madeorpaidinrespectoftheOfferShares,theOfferorreservestherighttoreducethe
OfferPricebyanamountequaltothenetamountofsuchdividendorotherdistribution.

Offer Price

TheOfferPriceofHK$2.18perOfferSharerepresents:

• (i) a discount of approximately 69.72% to the closing price of HK$7.20 per Share as quoted on the Stock Exchange on 10 July 2023, being the Last Trading Day;

• (ii) a discount of approximately 64.26% to the average closing price of approximately HK$6.10 per Share as quoted on the Stock Exchange for the last five (5) consecutive trading days immediately prior to and including the Last Trading Day;

• (iii) a discount of approximately 60.22% to the average closing price of approximately HK$5.48 per Share as quoted on the Stock Exchange for the last ten (10) consecutive trading days immediately prior to and including the Last Trading Day;

• (iv) a discount of approximately 51.77% to the average closing price of approximately HK$4.52 per Share as quoted on the Stock Exchange for the last thirty (30) consecutive trading days immediately prior to and including the Last Trading Day; and

• (v) a premium of approximately 435.36% over the net asset value per Share of approximately HK$0.4072 as at 31 December 2022, (based on a total of 132,000,000 Shares in issue as at the date of this joint announcement and the audited consolidated net assets value attributable to the owners of the Company of approximately HK$53,755,000 as at 31 December 2022).

–11–

Highest and lowest Share prices

DuringtheperiodcommencingsixmonthsprecedingthecommencementoftheOfferPeriod
anduptotheLastTradingDay,thehighestclosingpriceoftheSharesasquotedonthe
StockExchangewasHK$7.20perShareon10July2023,respectively,andthelowest
closingpriceoftheSharesasquotedontheStockExchangewasHK$0.48perShareon13
January2023.

Confirmation of financial resources

ThemaximumamountofcashpayablebytheOfferorinrespectoftheconsiderationpayable
uponfullacceptanceoftheOfferisHK$124,260,000,assumingthereisnochangeinthe
issuedsharecapitaloftheCompanyfromthedateofthisjointannouncementuptotheclose
oftheOffer.TheOfferorintendstosatisfytheconsiderationpayableundertheOfferbythe
OfferFacilityofuptoHK$130.0milliongrantedtohimbyQuamSecurities.TheOffer
Facilityissecuredby(i)theOfferFacilityShareChargegivenbytheOfferorinfavourof
QuamSecurities;and(ii)acashcollateralintheamountofHK$3,000,000.

GrandeCapital,asthefinancialadvisertotheOfferorinrespectoftheOffer,issatisfied
thatsufficientfinancialresourcesare,andwillremain,availabletotheOfferortosatisfythe
amountoffundsrequiredforfullacceptanceoftheOffer.

The making of the Offer is subject to Completion

TheOfferwillonlybemadeifCompletiontakesplace.

Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares. A further announcement will be made by the Offeror and the Company when Completion takes place. If Shareholders and potential investors are in any doubt about their position, they should consult their professional advisers.

Effect of accepting the Offer

TheOffer,ifmade,willbeunconditionalinallrespectsandwillnotbeconditionalupon
acceptancesbeingreceivedinrespectofaminimumnumberofSharesoranyother
conditions.

ByacceptingtheOffer,theIndependentShareholderswillbedeemedtowarrantthatallthe
OfferSharestobesoldbysuchpersonundertheOfferarefullypaidandfreefromall
encumbrancesandtogetherwithallrightsandbenefitsattachingtheretoasatthedateofthe
CompositeDocumentorsubsequentlybecomingattachedtothem,includingbutnotlimited
totherighttoreceiveinfullalldividends,distributionsandanyreturnofcapital,ifany,
whichmaybemadeordeclaredoragreedtobemadeordeclared,andtherecorddateof
whichfallsonorafterthedateonwhichtheOfferismade,beingthedateofdespatchofthe
CompositeDocument.

AcceptanceoftheOfferwillbeirrevocableandnotcapableofbeingwithdrawn,exceptas
permittedundertheTakeoversCode.

–12–

Payment

PaymentincashinrespectofacceptancesoftheOfferwillbemadeassoonaspossible
withinseven(7)businessdays(asdefinedintheTakeoversCode)ofthedateofreceiptofa
dulycompletedacceptance.Relevantdocumentsevidencingtitlemustbereceivedbyoron
behalfoftheOfferortorendersuchacceptanceoftheOffercompleteandvalid.

Hong Kong stamp duty

Seller’sadvaloremstampdutyatarateof0.13%ofthemarketvalueoftheOfferSharesor
considerationpayablebytheOfferorinrespectoftherelevantacceptancesoftheOffer,
whicheverishigher,willbedeductedfromtheamountpayabletotherelevantShareholders
onacceptanceoftheOffer.TheOfferorwillarrangeforpaymentofthesellers’advalorem
stampdutyonbehalfofacceptingShareholdersandpaythebuyer’sadvaloremstampduty
inconnectionwiththeacceptanceoftheOfferandthetransferoftheOfferShares.

Overseas Shareholders

AstheOffertopersonsnotbeingresidentinHongKongmaybeaffectedbythelawsofthe
relevantjurisdictioninwhichtheyareresident,OverseasShareholderswhoarecitizens,
residentsornationalsofajurisdictionoutsideHongKongshouldobserveanyapplicable
legalorregulatoryrequirementsand,wherenecessary,seeklegaladvice.Itisthesole
responsibilityoftheOverseasShareholderswhowishtoaccepttheOffertosatisfy
themselvesastothefullobservanceofthelawsandregulationsoftherelevantjurisdictions
inconnectionwiththeacceptanceoftheOffer(includingtheobtainingofanygovernmental,
exchangecontrolorotherconsentwhichmayberequired,thecompliancewithother
necessaryformalitiesandthepaymentofanytransferorothertaxesduefromtheaccepting
Shareholdersinrespectofsuchjurisdictions).

IfthereceiptoftheCompositeDocumentbytheOverseasShareholdersisprohibitedbyany
applicablelawsandregulationsandmayonlybeeffecteduponcompliancewithconditions
orrequirementsinsuchoverseasjurisdictionsthatwouldbeundulyburdensome,the
CompositeDocument,subjecttotheExecutive’sconsent,willnotbedespatchedtosuch
OverseasShareholdersandthiswillnotaffecttheOverseasShareholders’righttoacceptthe
Offer.Inthosecircumstances,theOfferorwillapplyforanywaiversasmayberequired
pursuanttoNote3toRule8oftheTakeoversCodeatsuchtime.TherearenoOverseas
Shareholdersasatthedateofthisjointannouncement.

AnyacceptanceoftheOfferbysuchOverseasShareholderswillbedeemedtoconstitutea
representationandwarrantyfromsuchOverseasShareholderstotheOfferorthatthe
applicablelocallawsandrequirementshavebeencompliedwith.TheOverseasShareholders
shouldconsulttheirprofessionaladvisersifindoubt.

–13–

Taxation advice

TheIndependentShareholdersarerecommendedtoconsulttheirownprofessionaladvisersif
theyareinanydoubtastothetaxationimplicationsofacceptingorrejectingtheOffer.
NoneoftheOfferor,partiesactinginconcertwiththeOfferor,theVendor,theCompany,
QuamSecurities,GrandeCapitalandtheirrespectiveultimatebeneficialowners,directors,
advisers,agentsorassociatesoranyotherpersoninvolvedintheOfferaccepts
responsibilityforanytaxationeffectson,orliabilitiesof,anypersonsasaresultoftheir
acceptanceorrejectionoftheOffer.

DEALING AND INTERESTS IN THE COMPANY’S SECURITIES

TheOfferorconfirmsthatasatthedateofthisjointannouncement:

• (a) save for the Share Charge, neither the Offeror nor any party acting in concert with him owned or had control or direction over any voting rights or rights over the Shares or options, warrants, derivatives or securities convertible into Shares or other derivatives in respect of securities in the Company;

• (b) save for the entering into of the Share Transfer Agreement, neither the Offeror nor any party acting in concert with him had dealt for value in any Shares or any options, warrants, derivatives or securities convertible into Shares or other derivatives in respect of securities in the Company during the period commencing six months preceding the commencement of the Offer Period and up to the date of this joint announcement;

• (c) save for the Offer Facility, the Offer Facility Share Charge and the Share Transfer Agreement, there is no arrangement (whether by way of option, indemnity or otherwise) of any kind referred to in Note 8 to Rule 22 of the Takeovers Code in relation to the Shares and which might be material to the Offer;

• (d) save for the Share Transfer Agreement, there is no agreement or arrangement to which the Offeror or any party acting in concert with him, is a party which relates to circumstances in which the Offeror may or may not invoke or seek to invoke a precondition or a condition to the Offer;

• (e) neither the Offeror nor any party acting in concert with him has borrowed or lent any relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) in the Company;

• (f) neither the Offeror nor any party acting in concert with him has received any irrevocable commitment to accept or reject the Offer;

• (g) there is no agreement or arrangement in relation to outstanding derivative in respect of the securities in the Company which has been entered into by the Offeror or any party acting in concert with him;

• (h) save for the Consideration payable to the Vendor under the Share Transfer Agreement, there is no other consideration, compensation or benefits in whatever form paid or to be paid by the Offeror or any party acting in concert with him to the Vendor, Mr. Ko or any party acting in concert with any of them in connection with the Share Transfer;

–14–

• (i) save for the Share Transfer Agreement, there is no understanding, arrangement, agreement or special deal (as defined under Rule 25 of the Takeovers Code) between the Vendor, Mr. Ko or any party acting in concert with any of them on one hand, and the Offeror or any party acting in concert with him on the other hand; and

• (j) there is no understanding, arrangement, agreement or special deal (as defined under Rule 25 of the Takeovers Code) between (i)(a) the Offeror or any party acting in concert with him, or (i)(b) the Company, its subsidiaries or associated companies on one hand; and (ii) any Shareholder on the other hand.

TheCompanyconfirmsthat,asatthedateofthisjointannouncement,thereisno
understanding,arrangement,agreementorspecialdeal(asdefinedunderRule25ofthe
TakeoversCode)between(i)(a)theCompany,itssubsidiariesorassociatedcompanies,or
(i)(b)theOfferororanypartyactinginconcertwithhimononehand;and(ii)any
Shareholderontheotherhand.

INFORMATION OF THE OFFEROR

TheOfferor,aged74,hasmorethan50yearsofexperienceintheapparelindustry.The
OfferorwasaformerdirectorofSouthSeasonIndustrialCompanyLimited,acompany
incorporatedinHongKongandprincipallyengagedinimportandexportbusinessof
garmentandaformerdirectorofActexTextilesLimited,acompanyincorporatedinHong
Kongandprincipallyengagedingarmentmanufacturing.Throughouthiscareerinthe
apparelindustry,theOfferorhasaccumulatedextensiveexperienceinthemanagement,
operationandadministrationofgarmentfactoryaswellasimportandexportbusinessesof
garmentandapparel.TheOfferoriscurrentlythesoleshareholderandsoledirectorofActex
InternationalLimited,acompanyincorporatedinHongKongwithlimitedliabilitywhichis
principallyengagedinthesaleofgarmentandapparel.

TheOfferorandpartiesactinginconcertwithhimarethirdpartiesindependentof,andnot
connectedwith,eithertheCompanyoranyofitsconnectedpersons.

INTENTIONS OF THE OFFEROR IN RELATION TO THE GROUP

UponCompletion,theOfferorwillbeinterestedin56.82%ofthetotalissuedsharecapital
oftheCompanyandwillbecomethecontrollingshareholderoftheCompany.

TheGroupisprincipallyengagedinthesalesofapparelandrelatedproductswiththe
provisionofsupplychainmanagementservicesandprovisionofagencyservicesfor
constructionandrelatedmaterials.

–15–

TheintentionoftheOfferoristhattheCompany’sexistingprincipalbusinessactivitieswill
bemaintainedandcontinuedaftercompletionoftheOffer.TheOfferorconfirmsthatthere
isnointentiontofurtherexpandand/ordivesttheexistingbusinessesoftheCompany
duringtheOfferPeriodandaftertheendoftheOfferPeriodunlessappropriate
opportunitiesarise.TheOfferorwillconductareviewoftheexistingprincipalbusinesses,
operations,financialposition,investments,proposedinvestmentsoftheGroupforthe
purposeofformulatinglong-termbusinessplansandstrategiesforthefuturebusiness
developmentoftheGroup.LeveragingtheOfferor’sexperience,industryknowledgeand
networkintheapparelindustry,theOfferorintendstoleveragethesynergiesbetweenthe
OfferorandtheGrouptoexplorerelatedbusinessopportunitiesinthefuture.

Subjecttotheresultsofthereview,theOfferormayexploreotherbusinessopportunities
andconsiderwhetheranyassetdisposals,assetacquisitions,businessrationalization,
businessdivestment,fundraising,restructuringofthebusinessand/orbusiness
diversificationwillbeappropriateinordertoenhancethelong-termgrowthpotentialofthe
Group.Asatthedateofthisjointannouncement,noinvestmentorbusinessopportunityhas
beenidentifiednorhavetheOfferorenteredintoanyagreement,arrangement,understanding
ornegotiationinrelationtotheinjectionofanyassetsorbusinessintotheGroup.Should
suchcorporateactionsmaterialise,furtherannouncement(s)willbemadeinaccordancewith
theGEMListingRules.

TheOfferorintendstocontinuetheemploymentoftheexistingmanagementandemployees
oftheGroup(exceptforaproposedchangetothemembersoftheBoardatatimenoearlier
thanthatpermittedundertheGEMListingRulesandtheTakeoversCodeorsuchlatertime
astheOfferorconsiderstobeappropriate).

TheOfferorintendstonominatenewdirector(s)totheBoardwitheffectfromadatewhich
isnoearlierthansuchdateaspermittedundertheGEMListingRulesandtheTakeovers
CodeorsuchlaterdateastheOfferorconsiderstobeappropriate.Anychangestothe
membersoftheBoardwillbemadeincompliancewiththeTakeoversCodesand/orthe
GEMListingRulesandfurtherannouncement(s)willbemadeasandwhenappropriate.

SavefortheOfferor’sintentionregardingtheGroupassetoutabove,(i)theOfferorhasno
intentiontomakematerialchangestotheemploymentofthemanagementandemployeesof
theGroup(exceptforaproposedchangetothemembersoftheBoardatatimenoearlier
thanthatpermittedundertheGEMListingRulesandtheTakeoversCodeorsuchlatertime
astheOfferorconsiderstobeappropriate);and(ii)theOfferorhasnointentiontodispose
oforredeploytheassetsoftheGroupotherthanthoseinitsordinaryandusualcourseof
business.

PUBLIC FLOAT AND MAINTAINING THE LISTING STATUS OF THE COMPANY

TheOfferorintendstomaintainthelistingoftheSharesontheStockExchangefollowing
thecloseoftheOffer.TheOfferordoesnotintendtoavailhimselfofanypowersof
compulsoryacquisitionofanySharesoutstandingafterthecloseoftheOffer.TheOfferor
will,togetherwiththeCompany,usereasonableendeavourstomaintainthelistingstatusof
theSharesontheStockExchangeandprocurethatnotlessthan25%oftheentireissued
sharecapitalintheCompanybeheldbythepublicincompliancewiththeGEMListing
Rules.

–16–

TheStockExchangehasstatedthatif,atthecloseoftheOffer,lessthantheminimum
prescribedpercentageapplicabletotheCompany,being25%oftheissuedShares,areheld
bythepublic,oriftheStockExchangebelievesthat:

• (i) a false market exists or may exist in the trading of the Shares; or

• (ii) that there are insufficient Shares in public hands to maintain an orderly market,

itwillconsiderexercisingitsdiscretiontosuspenddealingsintheShares.

Therefore,itshouldbenotedthat,uponcloseoftheOffer,theremaybeinsufficientpublic
floatoftheSharesandthetradingintheSharesmaybesuspendeduntilsufficientpublic
floatexistsfortheShares.

TheDirectorsandanynewDirector(s)proposedbytheOfferorwilljointlyandseverally
undertaketotheStockExchangetotakeappropriatestepsfollowingthecloseoftheOfferto
ensurethatsuchnumberofSharesasmayberequiredbytheStockExchangeareheldby
thepublicwithintheprescribedtimeframe.

INFORMATION OF THE GROUP

TheCompanyisaninvestmentholdingcompanyincorporatedintheCaymanIslandswith
limitedliability.TheGroupisprincipallyengagedinthesalesofapparelandrelated
productswiththeprovisionofsupplychainmanagementservicesandprovisionofagency
servicesforconstructionandrelatedmaterials.

SetoutbelowisasummaryoftheauditedconsolidatedfinancialinformationoftheGroup
foreachofthetwofinancialyearsended31December2021and2022,asextractedfromthe
Company’sannualreportfortheyearended31December2022:

	For	the year ended	For	the year ended
	31 December 2021		31 December 2022
		HK$’000		HK$’000
Revenue		125,707		160,375
(Loss) Profit before tax		(8,178)		5,386
(Loss) Profit and total comprehensive
(expenses) income for the year		(8,689)		4,898
		As at		As at
	31 December 2021		31 December 2022
		HK$’000		HK$’000
Total assets		106,267		110,346
Total liabilities		57,410		56,591
Net assets		48,857		53,755

–17–

SHAREHOLDING STRUCTURE OF THE COMPANY

Asatthedateofthisjointannouncement,theauthorisedsharecapitaloftheCompanywas
HK$100,000,000dividedinto1,000,000,000ordinaryshares,andthereare132,000,000
Sharesinissue.TheCompanyhasnootheroutstandingShares,options,warrants,
derivativesorothersecuritiesthatareconvertibleorexchangeableintoSharesorother
relevantsecuritiesintheCompany(asdefinedinNote4toRule22oftheTakeoversCode).

TheshareholdingstructureoftheCompany(i)asatthedateofthisjointannouncement;and
(ii)immediatelyafterCompletionandbeforetheOfferareshownbelow:

Shareholders The Vendor (Note 1) Arena Investors, LP (Note 2) The Offeror Public Shareholders	As at the date of this joint announcement Number of Shares Percentage of shareholding (approximately) (%) 75,000,000 56.82 21,000,000 15.91 — — 36,000,000 27.27 132,000,000 100.00	Immediately after Completion and before the Offer Number of Shares Percentage of shareholding (approximately) (%) — — 21,000,000 15.91 75,000,000 56.82 36,000,000 27.14 132,000,000 100.00	Immediately after Completion and before the Offer Number of Shares Percentage of shareholding (approximately) (%) — — 21,000,000 15.91 75,000,000 56.82 36,000,000 27.14 132,000,000 100.00
			100.00

Notes:

• (1) As at the date of this joint announcement, the Vendor is wholly owned by Mr. Ko, the chairman and an executive Director of the Company. Therefore, Mr. Ko is deemed to be interested in the Shares held by the Vendor under the SFO. Ms. Chan Sau Fung is the spouse of Mr. Ko. By virtue of the SFO, Ms. Chan is deemed to be interested in all the Shares in which Mr. Ko is interested.

• (2) According to the disclosure of interests filing available to the Company, Arena Investors, LP is an investment manager of and deemed to be interested in the Shares held by Arena Finance Markets, LP, Arena Special Opportunities (Offshore) Master, LP, Arena Special Opportunities Fund, LP, Arena Special Opportunities Partners II, LP and Arena Special Opportunities Partners (Cayman Master) II, LP.

Saveasdisclosedabove,asatthedateofthisjointannouncement,theDirectorsdidnot
haveanyinterestsintheSharesoftheCompany.

–18–

DISCLOSURE OF DEALINGS

InaccordancewithRule3.8oftheTakeoversCode,respectiveassociatesoftheCompany
andtheOfferor(asdefinedundertheTakeoversCodewhichincludes,amongothers,any
personwhoownsorcontrols5%ormoreofanyclassofrelevantsecurities(asdefinedin
Note4toRule22oftheTakeoversCode)oftheCompanyortheOfferor)areremindedto
disclosetheirdealingsinthesecuritiesoftheCompanyunderRule22oftheTakeovers
Code.

InaccordancewithRule3.8oftheTakeoversCode,reproducedbelowisthefulltextof
Note11toRule22oftheTakeoversCodeinrelationtotheresponsibilitiesofstockbrokers,
banksandotherintermediaries:

‘‘Responsibilities of stockbrokers, banks and other intermediaries

Stockbrokers, banks and others who deal in relevant securities on behalf of clients have a general duty to ensure, so far as they are able, that those clients are aware of the disclosure obligations attaching to associates of an offeror or the offeree company and other persons under Rule 22 and that those clients are willing to comply with them.

Principal traders and dealers who deal directly with investors should, in appropriate cases, likewise draw attention to the relevant Rules. However, this does not apply when the total value of dealings (excluding stamp duty and commission) in any relevant security undertaken for a client during any 7 day period is less than $1 million.

This dispensation does not alter the obligation of principals, associates and other persons themselves to initiate disclosure of their own dealings, whatever total value is involved.

Intermediaries are expected to co-operate with the Executive in its dealings enquiries. Therefore, those who deal in relevant securities should appreciate that stockbrokers and other intermediaries will supply the Executive with relevant information as to those dealings, including identities of clients, as part of that co-operation.’’

–19–

GENERAL

Independent Board Committee and Independent Financial Adviser

TheIndependentBoardCommitteecomprisingalltheindependentnon-executiveDirectors
whohavenodirectorindirectinterestintheOffer,namelyMr.ToKingYan,Adam,Mr.
KwokCheeKinandMr.ChanKimSun,willbeestablishedpursuanttoRule2.1ofthe
TakeoversCodetoadvisetheIndependentShareholdersastowhetherthetermsoftheOffer
arefairandreasonableandwhethertheOfferisintheinterestsoftheIndependent
ShareholdersasawholeandastotheacceptanceoftheOffer.

TheIndependentFinancialAdviserwillbeappointedwiththeapprovaloftheIndependent
BoardCommitteetoadvisetheIndependentBoardCommitteeandtheIndependent
ShareholdersinrespectoftheOfferand,inparticular,astowhetherthetermsoftheOffer
arefairandreasonableandastotheacceptanceoftheOffer.Furtherannouncement(s)will
bemadebytheCompanyupontheappointmentoftheIndependentFinancialAdviser.The
adviceoftheIndependentFinancialAdviserandtherecommendationsoftheIndependent
BoardCommitteewillbeincludedintheCompositeDocumenttobedespatchedtothe
Shareholders.

Despatch of the Composite Document

ItistheintentionoftheOfferorandtheCompanytocombinetheofferdocumentandthe
offeree’sboardcircularintheCompositeDocumenttobeposted.

PursuanttoRule8.2oftheTakeoversCode,theCompositeDocumentsettingout,among
others,(i)furtherdetailsoftheOffer;(ii)therecommendationfromtheIndependentBoard
Committee;(iii)aletterofadvicefromtheIndependentFinancialAdvisertothe
IndependentBoardCommitteeandtheIndependentShareholdersinrespectofthetermsof
theOfferandastotheacceptanceoftheOffer;and(iv)therelevantform(s)ofacceptance
andtransfer,willbedespatchedtotheShareholderswithin21daysafterthedateofthis
jointannouncementorsuchlaterdateastheExecutivemayapprove.Further
announcement(s)regardingthedespatchoftheCompositeDocumentwillbemadebythe
OfferorandtheCompanyasandwhenappropriate.

TheIndependentShareholdersareencouragedtoreadtheCompositeDocumentcarefully,
includingtheadviceoftheIndependentFinancialAdvisertotheIndependentBoard
CommitteeandtheIndependentShareholdersandtherecommendationfromtheIndependent
BoardCommitteetotheIndependentShareholdersinrespectofthetermsoftheOfferandas
totheacceptanceoftheOffer.

TRADING HALT AND RESUMPTION OF TRADING IN THE SHARES

AttherequestoftheCompany,tradingintheSharesontheStockExchangewashaltedwith
effectfrom9:00a.m.on11July2023pendingthereleaseofthisjointannouncement.
ApplicationhasbeenmadebytheCompanyforresumptionoftradingintheSharesonthe
StockExchangewitheffectfrom1:00p.m.on21July2023.

–20–

WARNING

Shareholders and potential investors should note that the Offer is a possible mandatory unconditional cash offer and will only be made if Completion takes place. The Independent Board Committee has yet to consider and evaluate the Offer. This joint announcement is made in compliance with the Takeovers Code for the purpose of, amongst other things, informing Shareholders of the fact that the Company has been informed that the Offer will be made if Completion takes place. The Directors make no recommendation as to the fairness or reasonableness of the Offer or as to the acceptance of the Offer in this joint announcement.

Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares. A further announcement will be made by the Offeror and the Company when Completion takes place. If Shareholders and potential investors are in any doubt about their position, they should consult their professional advisers.

DEFINITIONS

Inthisjointannouncement,unlessthecontextotherwiserequires,thefollowingexpressions
shallhavethefollowingmeanings:

• ‘‘acting in concert’’ has the meaning ascribed to it under the Takeovers Code ‘‘associate’’ has the meaning ascribed to it under the Takeovers Code ‘‘Board’’ the board of Directors ‘‘Business Day(s)’’ a day (other than Saturday or Sunday or a day on which a black rainstorm warning or tropical cyclone warning signal number 8 or above is hoisted in Hong Kong at any time between 9:00 a.m. and 5:00 p.m.) on which the Stock Exchange is open for the transaction of business

‘‘Company’’ Vision International Holdings Limited ( 威誠國際 控股 有限 公司 ), an exempted company incorporated in the Cayman Islands with limited liability, the issued Shares of which are listed on GEM (stock code: 8107) ‘‘Completion’’ completion of the sale and purchase of the Sale Shares pursuant to the Share Transfer Agreement

‘‘CompletionDate’’onorbeforetheBusinessDayafteralltheconditionsto
CompletionpursuanttotheShareTransferAgreementhave
beenfulfilled,or,whereapplicable,waivedbytheOfferor
orsuchotherdateastheVendorandtheOfferormayagree
inwriting

–21–

• ‘‘Composite Document’’

• the composite offer and response document to be jointly issued by the Offeror and the Company to the Shareholders in connection with the Offer in accordance with the Takeovers Code containing, among other things, details of the Offer (accompanied by the forms of acceptance and transfer) and the respective letters of advice from the Independent Board Committee and the Independent Financial Adviser

• ‘‘connected person(s)’’ has the meaning ascribed to it under the GEM Listing Rules

• ‘‘Consideration’’

• the amount of HK$57,725,952, being consideration payable by the Offeror to the Vendor for the Share Transfer

• ‘‘controlling shareholder’’ has the meaning ascribed to it under the GEM Listing Rules

• ‘‘Director(s)’’ director(s) of the Company

• ‘‘Executive’’ the Executive Director of the Corporate Finance Division of the SFC and any of his delegates

• ‘‘First Drawdown’’ the first drawdown of HK$20,300,000 made by the Vendor under the Loan on the First Drawdown Date pursuant to the Loan Agreement

• ‘‘First Drawdown Date’’ 29 December 2022, on which the Vendor made the First Drawdown

• ‘‘GEM’’ GEM operated by the Stock Exchange

• ‘‘GEM Listing Rules’’ the Rules Governing the Listing of Securities on GEM

• ‘‘Grande Capital’’ Grande Capital Limited, a licensed corporation to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities under the SFO, the financial adviser to the Offeror in relation to the Offer

• ‘‘Group’’ the Company and its subsidiaries

• ‘‘HK$’’ Hong Kong dollars, the lawful currency of Hong Kong

• ‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the PRC

• ‘‘Independent Board the independent committee of the Board, comprising all the Committee’’ independent non-executive Directors, namely Mr. To King Yan, Adam, Mr. Kwok Chee Kin and Mr. Chan Kim Sun, to be established by the Company to make recommendation to the Independent Shareholders in relation to the Offer

–22–

• ‘‘Independent Financial the independent financial adviser to be appointed by the Adviser’’ Company and approved by the Independent Board Committee to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Offer and as to the acceptance of the Offer

• ‘‘Independent holder(s) of Share(s), other than the Offeror and parties Shareholder(s)’’ acting in concert with him

• ‘‘Last Trading Day’’ 10 July 2023, being the last trading day of the Shares immediately prior to the halt in trading in the Shares on the Stock Exchange pending the release of this joint announcement

• ‘‘Lender’’

• Quick Target Limited, a company incorporated in the British Virgin Islands with limited liability, which is owned as to 40.0% by the Offeror, 20.1% by Ms. Choi Man Yun Marian (蔡曼恩), 13.3% by Ms. Kong Lai Ying (江 麗英 ), 13.3% by Mr. Chen Man Lung ( 陳文 龍) and 13.3% by Ms. Chung Tung Lai Fiona (鍾 東麗 ) as at the date of this joint announcement

• ‘‘Loan’’

• the loan advanced by the Offeror, for and on behalf of the Lender, to the Vendor pursuant to the Loan Agreement in the principal amount of HK$52,500,000 at an interest rate of 8% per annum

• ‘‘Loan Agreement’’

• the loan agreement dated 23 December 2022 entered into among the Vendor (as borrower), the Lender and Mr. Ko (as guarantor) in relation to the grant of the Loan by the Lender to the Vendor (as amended and supplemented by the Supplemental Loan Agreement dated 30 May 2023)

• ‘‘Long Stop Date’’

• 31 December 2023 (or such other date as the Vendor and the Offeror may from time to time agree in writing)

• ‘‘Mr. Ko’’

• Mr. Ko Sin Yun (高銑 印 ), the chairman and an executive Director of the Company

• ‘‘Offer’’

• the possible mandatory unconditional cash offer to be made by Quam Securities for and on behalf of the Offeror to acquire all the issued Shares not already owned or agreed to be acquired by the Offeror and parties acting in concert with him in accordance with the Takeovers Code

• ‘‘Offer Facility’’

• a loan facility of up to HK$130.0 million in aggregate made available by Quam Securities to the Offeror

–23–

• ‘‘Offer Facility Share a share charge to be given by the Offeror in favour of Quam Charge’’ Securities over the Sale Shares and Offer Shares to be acquired by the Offeror and parties acting in concert with him as security for the Offer Facility

• ‘‘Offeror’’ Mr. Lau Chi Wing James ( 劉志 榮), who is the purchaser under the Share Transfer Agreement

• ‘‘Offer Period’’ has the meaning ascribed to it under the Takeovers Code which commences on 21 July 2023 (being the date of this joint announcement) and ends on the date on which the Offer closes or lapses

• ‘‘Offer Price’’ the cash amount of HK$2.18 payable by the Offeror for each Offer Share

• ‘‘Offer Share(s)’’ all the issued Shares other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with him

• ‘‘Overseas Shareholders’’ Independent Shareholder(s) whose address(es), as shown on the register of members of the Company is/are outside Hong Kong

• ‘‘Personal Guarantee’’ the personal guarantee provided by Mr. Ko as guarantor in favour of the Lender to guarantee the repayment of the Loan by the Vendor

• ‘‘PRC’’ the People’s Republic of China which, for the purpose of this joint announcement, shall exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

• ‘‘Quam Securities’’ Quam Securities Limited, a corporation licensed to carry out Type 1 (dealing in securities), Type 2 (dealing in futures contracts), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities under the SFO, the agent making the Offer on behalf of the Offeror

• ‘‘Sale Shares’’ the 75,000,000 Shares agreed to be acquired by the Offeror from the Vendor pursuant to the terms and conditions of the Share Transfer Agreement, representing 56.82% of the total issued share capital of the Company as at the date of this joint announcement

• ‘‘Second Drawdown’’ the second drawdown of HK$32,200,000 made by the Vendor under the Loan on the Second Drawdown Date pursuant to the Loan Agreement and the Supplemental Loan Agreement

–24–

‘‘SecondDrawdownDate’’30May2023,onwhichtheVendormadetheSecond
Drawdown

• ‘‘SFC’’ the Securities and Futures Commission of Hong Kong

• ‘‘SFO’’

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

• ‘‘Share Charge’’ the share charge over the 75,000,000 Shares legally and beneficially owned by the Vendor created in favour of the Lender as security for the Loan

• ‘‘Shareholder(s)’’

holder(s)ofShare(s)

• ‘‘Share(s)’’ share(s) of nominal value of HK$0.1 each in the share capital of the Company

• ‘‘Share Transfer’’

• the purchase of the Sale Shares by the Offeror from the Vendor in accordance with the terms and conditions of the Share Transfer Agreement

• ‘‘Share Transfer Agreement’’ the conditional share transfer agreement dated 10 July 2023 entered into between the Vendor and the Offeror in relation to the sale and purchase of the Sale Shares

• ‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited

• ‘‘Supplemental Loan Agreement’’

• the supplemental loan agreement dated 30 May 2023 entered into among the Vendor (as borrower), the Lender and Mr. Ko (as guarantor), pursuant to which the Second Drawdown Date was amended from 29 June 2023 to 30 May 2023

• ‘‘Takeovers Code’’

• the Hong Kong Code on Takeovers and Mergers

• ‘‘Vendor’’

• Metro Vanguard Limited, a company incorporated in the British Virgin Islands with limited liability, which is wholly owned by Mr. Ko, the chairman and an executive Director of the Company

• ‘‘%’’

percent.

ByorderoftheBoardof

• Lau Chi Wing James 劉志 榮 先生

Vision International Holdings Limited 威誠國際 控股 有限公司

Mr. Ko Sin Yun

Chairman and Executive Director

HongKong,21July2023

–25–

As at the date of this joint announcement, the executive Directors are Mr. Ko Sin Yun, Mr. Ko Man Ho, Mr. Cheng Ka Wing and Ms. Ng Hoi Yung Yo Yo; and the independent nonexecutive Directors are Mr. To King Yan, Adam, Mr. Kwok Chee Kin and Mr. Chan Kim Sun.

All Directors jointly and severally accept full responsibility for the accuracy of the information contained in this joint announcement (other than the information relating to the Offeror and parties acting in concert with him), and confirm, having made all reasonable enquires, that to the best of their knowledge, opinions expressed in this joint announcement (other than those expressed by the Offeror and parties acting in concert with him) have been arrived at after due and careful consideration and there are no other facts not contained in this joint announcement, the omission of which would make any statement contained in this joint announcement misleading.

As at the date of this joint announcement, the Offeror is Mr. Lau Chi Wing James. The Offeror accepts full responsibility for the accuracy of the information contained in this joint announcement (other than the information relating to the Vendor and the Group), and confirms, having made all reasonable enquires, that to the best of his knowledge, opinions expressed in this joint announcement (other than those expressed by the Directors) have been arrived at after due and careful consideration and there are no other facts not contained in this joint announcement, the omission of which would make any statement contained in this joint announcement misleading.

This joint announcement will remain on the ‘‘Latest Listed Company Information’’ page of the website of the Stock Exchange at www.hkexnews.hk for at least seven days from the day of its publication. This joint announcement will also be published on the Company’s website at http://www.vision-holdings.com.hk/.

–26–