Sinopec Engineering Group Co Ltd. — Proxy Solicitation & Information Statement 2014

Jan 29, 2014

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Universe International Holdings Limited (the “Company”), you should at once hand this circular to the purchaser or transferee, or to the bank, stockbroker or other agent through whom the same or transfer was effected for transmission to the purchaser or transferee.

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

UNIVERSE INTERNATIONAL HOLDINGS LIMITED 寰宇國際控股有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1046)

DISCLOSEABLE AND CONNECTED TRANSACTION RELATING TO DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL IN UNIVERSE PROPERTY INVESTMENT LIMITED AND

JOY TALENT INVESTMENT LIMITED AND

PROPOSED CONTINUING CONNECTED TRANSACTIONS RELATING TO LEASING OF WYLER CENTRE PROPERTIES

AND RE-ELECTION OF DIRECTORS

Independent Financial Adviser to the Independent Board Committee

A letter from Pan Asia Corporate Finance Limited, the independent financial adviser to the independent board committee of the Company, containing its opinion to the independent board committee is set out on pages 33 to 45 of this circular.

A letter from the independent board committee of the Company is set out on page 32 of this circular.

A notice convening a special general meeting of the Company (the “SGM”) to be held at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong on Wednesday, 19 February 2014 at 2:30 p.m., or in the event that a black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day, at the same time and place on the second Business Day after 19 February 2014 (or any adjournment thereof), at which the proposed ordinary resolutions as stated in the aforesaid notice will be considered, is set out on pages 82 to 84 of this circular. A form of proxy for use at the SGM (or any adjournment thereof) is enclosed. Whether or not you intend to attend the SGM, please complete and return the enclose form of proxy in accordance with the instructions printed thereon to the principal place of business of the Company in Hong Kong at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong as soon as possible but in any event no later than 48 hours before the time appointed for the holding of the SGM (or any adjournment thereof). Completion and return of the form of proxy will not preclude you from attending and voting at the SGM (or any adjournment thereof) should you so wish and in any event the form of proxy shall be deemed to be revoked.

29 January 2014

• for identification purpose only

CONTENTS

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from	the Board
1	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
2	Discloseable and Connected Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
3	Proposed Continuing Connected Transaction . . . . . . . . . . . . . . . . . . . . . . . . . .	25
4	Re-election of retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	27
5	SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29
6	Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	30
7	Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	30
8	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31
9	Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31
Letter from	the Independent Board Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	32
Letter from	Independent Financial Adviser. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	33
Appendix I	Valuation Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	46
Appendix II	General Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	77
Notice of Special General Meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		82

– i –

DEFINITIONS

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

“associate(s)”

has the meaning ascribed to it in the Listing Rules

“Board”

the board of Directors

“Business Day”

any day (excluding Saturday) on which no black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day and on which licensed banks in Hong Kong are open for general banking business

“Bye-Laws”

the existing bye-laws of the Company and “Bye-law” shall be construed accordingly

“Company”

Universe International Holdings Limited, a company incorporated in Bermuda with limited liability and the Shares are listed on the Stock Exchange

“Companies Ordinance”

the Companies Ordinance, Chapter 32 of the Laws of Hong Kong

“Connected Persons”

has the meaning ascribed to it under the Listing Rules

“Considerations”

the JT Consideration and the UPI Consideration

• “Continuing Connected Transactions”

the proposed continuing connected transactions contemplated under the Tenancy Agreement upon the UPI Completion

“Director(s)”

the director(s) of the Company

“Disposal”

the UPI Disposal and the JT Disposal

“GEM”

the Growth Enterprise Market of the Stock Exchange

• “Globalcrest”

Globalcrest Enterprises Limited, a company incorporated in the British Virgin Islands with limited liability, the entire issued share capital of which is held by Central Core Resources Limited, the trustee of a discretionary trust under which certain immediate family members of Mr. Lam are discretionary objects, and a substantial shareholder of the Company

– 1 –

DEFINITIONS

• “Group”

the Company and its subsidiaries

• “HK Property 1” Unit 1 on 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 2” Car Parking Space No. P1 on 2nd Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 3” Car Parking Space No. P24 on 2nd Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 4” Car Parking Space No. P25 on 2nd Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 5” Car Parking Space No. P26 on 2nd Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 6” Car Parking Space No. P41 on 2nd Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 7” Room B, Unit 2 on 18th Floor, Wyler Centre Phase II, 192200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Property 8” No. 61, 1st Street, Section M, Fairview Park, Yuen Long, New Territories, Hong Kong

• “HK Property 9”

• Factory K on 16th Floor of Block 3, Golden Dragon Industrial Centre, Nos. 172-180 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

• “HK Properties”

HK Property 1 to HK Property 9

• “HK$”

Hong Kong dollars, the lawful currency of Hong Kong

– 2 –

DEFINITIONS

• “Hong Kong”

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

• “Independent Board an independent committee of the Board comprising the Committee” three independent non-executive Directors formed for the purpose of advising and giving recommendation to the Independent Shareholders regarding the S&P Agreements

• “IFA” or “Pan Asia”

• Pan Asia Corporate Finance Limited, a licensed corporation under the SFO to carry out type 1 (dealing in securities) and type 6 (advising on corporate finance) regulated activities and the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders regarding the S&P Agreements

• “Independent Shareholders”

• Shareholders other than Mr. Lam and Globalcrest and their respective associates, who do not have any material interest in the Disposal

• “JT” Joy Talent Investment Limited（俊宜投資有限公司）, a company incorporated under the Companies Ordinance with limited liability and an indirect wholly-owned subsidiary of the Company

• “JT Agreement”

• the conditional agreement dated 10 December 2013 entered into between the JT Vendor and the Purchaser in relation to the sale and purchase of the entire issued share capital in JT

• “JT Completion” the completion of the sale and purchase of the JT Sale Share under the JT Agreement

• “JT Consideration”

• HK$6,277,000, being the total consideration payable by the Purchaser to the JT Vendor in cash under the JT Agreement

• “JT Disposal”

the disposal of the JT Sale Shares by the JT Vendor to the Purchaser pursuant to the terms and conditions of the JT Agreement

– 3 –

DEFINITIONS

• “JT Sale Share” one ordinary share of HK$1.00 in the capital of JT beneficially owned by UFH

• “JT Vendor” UFH

• “JT Vendor”

• “Latest Practicable Date” 24 January 2014, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

• “Model Code” Model Code for Securities Transactions by Directors of Listed Companies

• “Mr. Lam” Mr. Lam Shiu Ming, Daneil, the Chairman and an executive Director

• “Mr. Choi” Mr. Choi Wing Koon, an independent non-executive Director

• “Mr. C.K. Lam” Mr. Lam Chi Keung, an independent non-executive Director “Ordinary Resolution(s)” the proposed ordinary resolution(s) as referred to in the notice of SGM

• “PRC” or “China” The People’s Republic of China which excludes Hong Kong for the purpose of this circular

• “PRC Property” No. 1501, 15th Floor, Block 24, Jianwai SOHO, No. 39 Dongsanhuan Zhonglu, Chaoyang District, Beijing, the PRC

• “Properties”

the PRC Properties and the HK Properties

• “Purchaser”

Mr. Lam

“RAL” Roma Appraisals Limited, an independent professional surveyor and a qualified property valuer

– 4 –

DEFINITIONS

“Rental Valuation” HK$244,000 per month, being the market rental of the Wyler Centre Properties as at 30 November 2013 performed by RAL “RMB” Renminbi yuan, the lawful currency of the PRC “S&P Agreements” the UPI Agreement and the JT Agreement “SFO” the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong “SGM” the special general meeting of the Company to be held at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong on Wednesday, 19 February 2014 at 2:30 p.m., or in the event that a black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day, at the same time and place on the second Business Day after 19 February 2014 (or any adjournment thereof) for the Shareholders to consider and, if thought fit, approve, among other things, the S&P Agreements and the transactions contemplated thereunder; and the re-election of the retiring Directors “Share(s)” share(s) of HK$0.02 each in the capital of the Company “Shareholders” holder(s) of Shares “Stock Exchange” The Stock Exchange of Hong Kong Limited “subsidiary” a company which is for the time being and from time to time a subsidiary (within the meaning of the Companies Ordinance) of the Company and “subsidiaries” shall be construed accordingly “Tenancy Agreement” the tenancy agreement to be entered into between UPI as landlord and the UDE as tenant upon the UPI Completion on terms as set out therein

– 5 –

DEFINITIONS

“UDE”	Universe Digital Entertainment Limited（寰宇數碼娛樂
	有限公司）, a company incorporated under the Companies
	Ordinance with limited liability and an indirect wholly-
	owned subsidiary of the Company
“UFH”	Universe Films (Holdings) Limited, a company
	incorporated under the laws of the British Virgin Islands
	with limited liability and a direct wholly-owned subsidiary
	of the Company
“ULV”	Universe Laser & Video Co., Limited（寰宇鐳射錄影有
	限公司）, a company incorporated under the Companies
	Ordinance with limited liability and an indirect wholly-
	owned subsidiary of the Company
“UPI”	Universe Property Investment Limited（寰宇物業投資有
	限公司）, a company incorporated under the Companies
	Ordinance with limited liability and an indirect wholly-
	owned subsidiary of the Company
“UPI Agreement”	the conditional agreement dated 10 December 2013 entered
	into between the UPI Vendors and the Purchaser in relation
	to the sale and purchase of the entire issued share capital in
	UPI
“UPI Completion”	the completion of the sale and purchase of the UPI Sale
	Shares under the UPI Agreement
“UPI Consideration”	HK$73,862,000, being the total consideration payable by
	the Purchaser to the UPI Vendors in cash under the UPI
	Agreement
“UPI Disposal”	the disposal of the UPI Sale Shares by the UPI Vendors to
	the Purchaser pursuant to the terms and conditions of the
	UPI Agreement
“UPI Sale Shares”	two ordinary shares of HK$1.00 each in the capital of UPI
	beneficially owned by UFH
“UPI Vendors”	UFH and ULV

– 6 –

DEFINITIONS

“Vendors” UFH and ULV “Wyler Centre Properties” HK Property 1 to HK Property 6 “%” per cent

For the purposes of this circular, unless otherwise indicated, the exchange rate at RMB1.00 = HK$1.2826 has been used, where applicable, for purpose of illustration only and do not constitute a representation that any amount have been, could have been or may be exchanged.

– 7 –

LETTER FROM THE BOARD

UNIVERSE INTERNATIONAL HOLDINGS LIMITED 寰宇國際控股有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1046)

Directors:

Directors: Registered office: Executive Directors: Clarendon House Mr. Lam Shiu Ming, Daneil (Chairman) 2 Church Street Mr. Hung Cho Sing Hamilton HM 11 Mr. Yeung Kim Piu Bermuda Mr. Lam Kit Sun

Head Office and Principal place Independent Non-executive Directors: of business: Mr. Lam Wing Tai 18th Floor Mr. Choi Wing Koon Wyler Centre Phase II Mr. Lam Chi Keung 192-200 Tai Lin Pai Road Kwai Chung New Territories, Hong Kong 29 January 2014

To the Shareholders

Dear Sir/Madam,

DISCLOSEABLE AND CONNECTED TRANSACTION RELATING TO DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL IN UNIVERSE PROPERTY INVESTMENT LIMITED AND JOY TALENT INVESTMENT LIMITED AND

PROPOSED CONTINUING CONNECTED TRANSACTIONS RELATING TO LEASING OF WYLER CENTRE PROPERTIES AND RE-ELECTION OF DIRECTORS

1. INTRODUCTION

The Board announced on 10 December 2013 that (after trading hours of the Stock Exchange), the JT Vendor entered into the JT Agreement with the Purchaser pursuant to which the JT Vendor agreed to sell, and Purchaser agreed to purchase, the JT Sale Share for the JT Consideration of HK$6,277,000.

• for identification purpose only

– 8 –

LETTER FROM THE BOARD

The Board further announces that on 10 December 2013 (after trading hours of the Stock Exchange), the UPI Vendors entered into the UPI Agreement with the Purchaser pursuant to which the UPI Vendors agreed to sell, and Purchaser agreed to purchase, the UPI Sale Share for the UPI Consideration of HK$73,862,000.

The net proceeds (after deducting the estimated direct expenses for the Disposal) arising from the Disposal are expected to be approximately HK$78,488,000. The Company intends to utilise approximately HK$10,000,000 for general working capital to pay the daily administrative expenses of the Group, approximately HK$10,000,000 for the investments in listed securities, and approximately HK$58,488,000 for the development of new investment opportunities. The net proceeds from the Disposal, to the extent that the above intended uses have not yet been implemented, may be used by the Group for treasury purposes by placing the net proceeds as fixed deposit in bank(s) or by applying them in the Group’s money lending business to have a fixed rate of return for definitive period.

The expected net gain to be derived from the Disposal will amount to approximately HK$42,319,000, which represents the difference between (a) the net proceeds of approximately HK$78,488,000 (after deducting the estimated direct expenses for the Disposal) arising from the Disposal; and (b) the aggregate sum of the carrying amounts of the net assets value of JT and UPI of approximately HK$36,169,000 in the consolidated financial statements of the Group as at 30 November 2013. Such calculation is only an estimate provided for illustrative purpose and the accounting treatment of the Disposal will be further discussed with auditors of the Group.

The JT Agreement and the UPI Agreement are inter-conditional. Each of the JT Completion and the UPI Completion is also subject to certain other conditions as described in this circular below and will take place simultaneously.

As the relevant applicable percentage ratios of the Disposal calculated in accordance with Rule 14.07 of the Listing Rules are more than 5% but less than 25%, the Disposal constitutes a discloseable transaction for the Company under Rule 14.06 of the Listing Rules and is subject to the reporting and announcement requirements under the Listing Rules. Since the Purchaser is the Chairman of the Company and an executive Director, and hence a Connected Person of the Company; and the Considerations exceed HK$10,000,000, the Disposal is also subject to the reporting, announcement and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

Each of Mr. Choi and Mr. C.K. Lam was appointed as an independent non-executive Director by the Board with effect from 4 December 2013 to fill the casual vacancy arising from the resignations of two independent non-executive Directors. Pursuant to Bye-Law 86(2) of the ByeLaws, each of Mr. Choi and Mr. C.K. Lam shall hold office until the SGM and being eligible, offers himself for re-election at the SGM.

– 9 –

LETTER FROM THE BOARD

The Company will convene the SGM to approve, (a) among other things, the S&P Agreements and the transactions contemplated thereunder. Globalcrest, Mr. Lam and their respective associates will abstain from voting at the SGM for this matter; and (b) the re-election of the retiring Directors.

The Independent Board Committee has been established to advise and give recommendation to the Independent Shareholders regarding the S&P Agreements.

Pan Asia has been appointed by the Group as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders on the S&P Agreements.

The purpose of this circular is to provide you with further information in respect of, among other things, (a) further details of the S&P Agreements; (b) financial and other information on JT and UPI, respectively; (c) the letter of the Independent Board Committee setting out its opinion on the S&P Agreements and its recommendation to Independent Shareholders; (d) the letter of the independent financial adviser to the Independent Board Committee and Independent Shareholders setting out its opinion on the S&P Agreements; (e) the formal valuation report on the Properties; (f) details in relation to the re-relection of the retiring Directors; (g) the notice convening the SGM; and (h) other information as required under the Listing Rules.

2. DISCLOSEABLE AND CONNECTED TRANSACTION

(a) The JT Agreement

Date

After trading hours of the Stock Exchange on 10 December 2013

Parties

• (1) UFH as the JT Vendor

The JT Vendor is an indirect wholly-owned subsidiary of the Company and is principally engaged in investment holding in Hong Kong.

• (2) Mr. Lam, as the Purchaser

Sale and Purchase

Pursuant to the JT Agreement, the JT Vendor agreed to sell, and the Purchaser agreed to purchase, the JT Sale Share representing the entire issued share capital in JT subject to the terms contained therein. The principal assets of JT consist of the PRC Property.

– 10 –

LETTER FROM THE BOARD

The PRC Property comprises an office unit with a gross floor area of 3,029 square foot in a large scale residential/office/commercial composite development, known as Jianwai SOHO. The subject building was completed in about 2006. The land use rights of the PRC Property have been granted for a term expiring on 4 August 2052 for office use. The PRC Property was acquired by the Group in 2006 and has been held for use by the Group. As the business operation of the Group in Beijing is not material, the disposal of the PRC Property will not affect the operation of the Group.

JT Consideration

The JT Consideration in the sum of HK$6,277,000 is payable in cash by the Purchaser to the JT Vendor in the following manner:

• (1) as to HK$313,850 being 5% of the JT Consideration will be payable as deposit to the JT Vendor within 5 business days of the date of the JT Agreement; and

• (2) as to HK$5,963,150 being 95% of the JT Consideration will be payable to the JT Vendor on the JT Completion.

The JT Consideration was arrived at after arm’s length negotiations between the JT Vendor and the Purchaser after taking into account (i) the unaudited net liabilities value of JT of approximately HK$1,846,000 as at 30 November 2013; and (ii) the increase in the fair value of the PRC Property of approximately HK$8,123,000 as compared to its net carrying value of approximately HK$5,191,000 as at 30 November 2013, which is based on the valuation of the PRC Property of approximately HK$13,314,000 (RMB10,380,000) as at 30 November 2013 performed by RAL.

On JT Completion, Mr. Lam agreed to settle a debt of approximately HK$6,428,513 owed by JT to JT Vendor on behalf of JT. Apart from such debt, there is no other inter-company balance between JT and other members of the Group which is required to be settled on JT Completion.

If the JT Completion does not take place by, or the JT Agreement is rescinded before, 30 April 2014 or such other date as the JT Vendor and the Purchaser may agree in writing, the said deposit shall be refunded to the Purchaser without interest.

– 11 –

LETTER FROM THE BOARD

Conditions Precedent

The JT Agreement and the UPI Agreement are inter-conditional.

The JT Completion is conditional upon:

• (1) all requirements imposed by the Stock Exchange under the Listing Rules or otherwise in connection with the transactions contemplated by the JT Agreement having been fully complied with;

• (2) all waivers, consents, approvals or confirmations of the Stock Exchange which are required or appropriate or in relation thereto, and all relevant waivers, consents, approvals or confirmations required for the purposes of the parties for the entry into and the implementation of the JT Agreement, having been obtained;

• (3) the passing by the independent shareholders of the Company in the SGM by way of poll of resolution(s) approving, amongst other things, the transactions contemplated under the JT Agreement and the implementation of such transactions;

• (4) the warranties, representations and undertakings of the JT Vendor being true and accurate in all material respects when made, and being true and accurate in all material respects on the date of the JT Completion; and

• (5) the UPI Agreement having become unconditional in all respects save as regards any condition requiring the JT Agreement to become unconditional.

JT Completion

It is provided in the JT Agreement that the JT Completion will take place on or before 30 April 2014. The JT Completion and the UPI Completion will take place simultaneously. Upon JT Completion, JT will cease to be a subsidiary of the Company.

– 12 –

LETTER FROM THE BOARD

If any of the above conditions precedent shall not have been fulfilled (or waived in accordance with the terms of the JT Agreement) by 30 April 2014 or such other date as the JT Vendor and the Purchaser may agree in writing, then the JT Agreement shall be null and void and of no effect. Only the condition precedent in (4) above may be waived by the Purchaser.

(b) The UPI Agreement

Date

After trading hours of the Stock Exchange on 10 December 2013

Parties

• (1) UFH and ULV as the UPI Vendors

The UPI Vendors are both indirect wholly-owned subsidiaries of the Company and are principally engaged in investment holding in Hong Kong and distribution of films in various videogram formats in Hong Kong, respectively

• (2) Mr. Lam, as the Purchaser

Sale and Purchase

Pursuant to the UPI Agreement, the UPI Vendors agreed to sell, and the Purchaser agreed to purchase, the UPI Sale Shares representing the entire issued share capital in UPI subject to the terms contained therein. The principal assets of UPI consist of the HK Properties.

The HK Properties comprise the following:

• (1) HK Property 1 – an industrial unit on the 18th Floor of a 28-storey industrial building over a 2-storey lorry/car parking podium plus a 2-level basement (with a saleable area of approximately 13,983 square foot). The building was completed in 1989;

– 13 –

LETTER FROM THE BOARD

• (2) HK Property 2 to HK Property 6 – 5 carparking space nos. P1, P24, P25, P26 and P41 on the 2nd Floor of a 28-storey industrial building over a 2-storey lorry/car parking podium plus a 2-level basement. The building was completed in 1989;

• (3) HK Property 7 – an industrial unit on the 18th Floor of a 28-storey industrial building over a 2-storey lorry/car parking podium plus a 2-level basement (with a saleable area of approximately 5,087 square foot). The building was completed in 1989;

• (4) HK Property 8 – a detached house situated in a large-scale low-rise residential development known as Fairview Park which was completed in 1977. The property has a gross floor area of about 1,297 square foot; and

• (5) HK Property 9 – a unit on the 16th Floor of a 26-storey industrial building including 2-storey car park podium known as Golden Dragon Industrial Centre completed in 1978. The property has a saleable floor area of about 1,000 square foot.

HK Property 1 to HK Property 7 have been held by the Group for more than 10 years; and HK Property 8 to HK Property 9 have been held by the Group for more than 2 years for the purposes as shown in each of the following balance sheets:

		Consolidated Balance	Consolidated Balance	Sheet as at
				5 month
		Year ended	Year ended	period ended
		30 June 2012	30 June 2013	30 November 2013
HK Property	1	own use	own use	own use
HK Property	2	own use	own use	own use
HK Property	3	own use	own use	own use
HK Property	4	own use	own use	own use
HK Property	5	investment	own use	own use
HK Property	6	investment	own use	own use
HK Property	7	own use	investment	investment
HK Property	8	investment	investment	investment
HK Property	9	investment	investment	investment

– 14 –

LETTER FROM THE BOARD

UPI Consideration

The UPI Consideration in the sum of HK$73,862,000 is payable in cash by the Purchaser to the UPI Vendors in the following manner:

• (1) as to HK$3,693,100 being 5% of the UPI Consideration will be payable as deposit to the UPI Vendors within 5 business days of the date of the UPI Agreement; and

• (2) as to HK$70,168,900 being 95% of the UPI Consideration will be payable to the UPI Vendor on the UPI Completion.

The HK Properties owned by UPI were valued at approximately HK$73,620,000, which is based on the valuation report as at 30 November 2013 performed by RAL. After taking into account of the HK Properties’ valuation as at 30 November 2013 performed by RAL, the unaudited net assets value of UPI is approximately HK$73,862,000 as at 30 November 2013. The UPI Consideration was arrived at after arm’s length negotiations between the UPI Vendors and the Purchaser after taking into account the unaudited net assets value of UPI of approximately HK$73,862,000 as at 30 November 2013.

There is no inter-company balance between UPI and other members of the Group which is required to be settled on UPI Completion.

If the UPI Completion does not take place by, or the UPI Agreement is rescinded before, 30 April 2014 or such other date as the UPI Vendors and the Purchaser may agree in writing, the said deposit shall be refunded to the Purchaser without interest.

– 15 –

LETTER FROM THE BOARD

Conditions Precedent

The UPI Agreement and the JT Agreement are inter-conditional.

The UPI Completion is conditional upon:

• (1) all requirements imposed by the Stock Exchange under the Listing Rules or otherwise in connection with the transactions contemplated by the UPI Agreement having been fully complied with;

• (2) all waivers, consents, approvals or confirmations of the Stock Exchange which are required or appropriate or in relation thereto, and all relevant waivers, consents, approvals or confirmations required for the purposes of the parties for the entry into and the implementation of the UPI Agreement, having been obtained;

• (3) the passing by the independent shareholders of the Company in the SGM by way of poll of resolution(s) approving, amongst other things, the transactions contemplated under the UPI Agreement and the implementation of such transactions;

• (4) the warranties, representations and undertakings of the UPI Vendor being true and accurate in all material respects when made, and being true and accurate in all material respects on the date of the UPI Completion; and

• (5) the JT Agreement having become unconditional in all respects save as regards any condition requiring the UPI Agreement to become unconditional.

– 16 –

LETTER FROM THE BOARD

UPI Completion

It is provided in the UPI Agreement that the UPI Completion will take place on or before 30 April 2014. The UPI Completion and the JT Completion will take place simultaneously. Upon the UPI Completion, UPI will cease to be a subsidiary of the Company.

If any of the above conditions precedent shall not have been fulfilled (or waived in accordance with the terms of the UPI Agreement) by 30 April 2014 or such other date as the UPI Vendors and the Purchaser may agree in writing, then the UPI Agreement shall be null and void and of no effect. Only the condition precedent in (4) above may be waived by the Purchaser.

(c) Information on JT and UPI

JT was incorporated under the Companies Ordinance and an indirect wholly-owned subsidiary of the Company. JT is principally engaged in property holding. JT is held by the JT Vendor for the sole purpose of holding the PRC Property. The PRC Property was stated at its cost less accumulated depreciation at each balance sheet date in the financial statements of JT and the consolidated financial statements of the Group. The following are the financial information of JT for the two years ended 30 June 2012 and 30 June 2013 respectively and the 5 months period ended 30 November 2013, which were prepared in accordance with the Hong Kong Financial Reporting Standards:

			5 months
	Year ended	Year ended	period ended
	30 June 2012	30 June 2013	30 November 2013
	HK$’000	HK$’000	HK$’000
Total assets	5,388	5,251	5,194
Net (liabilities)	(1,440)	(1,745)	(1,846)
(Loss) before tax and
extraordinary items	(334)	(305)	(101)
(Loss) after tax and extraordinary
items	(334)	(305)	(101)

– 17 –

LETTER FROM THE BOARD

UPI was incorporated under the Companies Ordinance and is an indirect whollyowned subsidiary of the Company. UPI is principally engaged in property holding. UPI is held by the UPI Vendors for the sole purpose of holding the HK Properties. Each of UFH and ULV legally holds one ordinary share of HK$1.00 in the capital of UPI. The one ordinary share of HK$1.00 is held by ULV in trust for UFH. Hence, the two ordinary shares of HK$1.00 each in the capital of UPI are beneficially owned by UFH. The HK Properties were stated at their fair values at each balance sheet date in the financial statements of UPI. In the consolidated financial statements of the Group, the properties held for the Group’s own use were stated at their cost less accumulated depreciation as property, plant and equipment, while the properties held for investment purpose were stated at their fair values as investment properties at each balance sheet. The following are the financial information of UPI for the two years ended 30 June 2012 and 30 June 2013 respectively and the 5 months period ended 30 November 2013, which were prepared in accordance with the Hong Kong Financial Reporting Standards:

			5 months
	Year ended	Year ended	period ended
	30 June 2012	30 June 2013	30 November 2013
	HK$’000	HK$’000	HK$’000
Total assets	94,773	110,741	74,110
Net assets	80,142	95,225	73,862
Profit before tax and
extraordinary items
(Note)	4,542	14,991	5,743
Profit after tax and extraordinary
items
(Note)	4,643	15,083	5,765

Note: These include the fair value gains of the HK Properties of approximately HK$5,150,000, HK$15,500,000 and HK$5,920,000 for the year ended 30 June 2012, year ended 30 June 2013 and the 5 months period ended 30 November 2013, respectively.

The PRC Property and the HK Properties were valued at RMB10,380,000 (approximately HK$13,314,000) and HK$73,620,000 respectively as at 30 November 2013 by RAL, representing a valuation for the Properties of approximately HK$86,934,000 as at 30 November 2013 by RAL.

– 18 –

LETTER FROM THE BOARD

(d) Reasons and Benefits of the Disposal

The Group is principally engaged in the business of distribution of films in various videogram formats, licensing and sub-licensing of film rights and film exhibition and leasing of investment properties.

The Properties form part of the properties acquired by the Group in the past. Given that the recent real property markets in the PRC and Hong Kong have been quite buoyant and the values of the Properties have appreciated. However, due to the cooling measures imposed by the Hong Kong Government and the PRC authorities in the Hong Kong and PRC property markets, respectively in 2013, the property markets there are undergoing some changes. In view of the slowdown in property transactions in the Hong Kong property market and the uncertain trend in the PRC property market, the Directors consider that it is in the interests of the Company and the Shareholders to dispose of the Properties for cash in capitalising on favourable market conditions to realize capital gain and enhance the working capital of the Group. In early December 2013, Mr. Lam, the Chairman of the Company and an executive Director, had expressed his interests in acquiring the Properties for cash at market prices.

Due to the above-mentioned cooling measures, the Group is also inevitably faced with a relatively limited choice of buyers of the Properties than it may otherwise be the case. With a view of the saving time and commission involved in appointing the property agency to sell the Properties, the Board decided to dispose of the Properties to Mr. Lam.

As a result of the Disposal, the Group will cease to receive any monthly rental income of HK$119,000 from the HK Properties and at the same time need to incur a monthly rental expenses of HK$244,000 for using the Wyler Centre Properties. Although the Group needs to incur additional rental expenses after the Disposal, the Group can realize capital gain of the Properties as a result of the Disposal. In addition, the Group will apply the net proceeds of approximately HK$78,488,000 (after deducting the estimated direct expenses for the Disposal) arising from the Disposal with the aim to generate additional return to the Shareholders.

After taking into account the above factors, the Directors (excluding Mr. Lam and the Independent Board Committee, and the views of the Independent Board Committee are expressed in the letter from the Independent Board Committee) considered that the terms of the S&P Agreements (including the Considerations) are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned, and the entering into of the S&P Agreements is in the interests of the Company and the Independent Shareholders as a whole.

– 19 –

LETTER FROM THE BOARD

(e) Financial Effect of the Disposal and Use of Proceeds

The net proceeds (after deducting the estimated direct expenses for the Disposal) arising from the Disposal are expected to be approximately HK$78,488,000. The Company intends to utilise approximately HK$10,000,000 for general working capital to pay the daily administrative expenses of the Group, approximately HK$10,000,000 for the investments in listed securities, and approximately HK$58,488,000 for the development of new investment opportunities including, but not limited to, the maximum investment of HK$20,000,000 to be contributed by the Group to a joint venture company (“JV Company”) to be set up with Computech Holdings Limited (“Computech”), a company incorporated in the Cayman Islands with limited liability whose issued shares are listed on GEM (Stock Code: 8081), in order to engage in the development and sale of computer and mobile phone games. The maximum investment in the JV Company shall be HK$40,000,000, which shall be contributed as to 50% by Computech and 50% by the Group. Please refer to the Company’s announcement dated 5 December 2013 for further details.

Beside the aforesaid investment in the JV Company, the Group has also entered two cooperation framework agreements in the second half of 2013 as follows:

• (i) pursuant to the Company’s announcement dated 30 October 2013, the Group entered into a cooperative framework agreement (“Framework Agreement”) with 貴州多彩貴州城建設經營有限公司 (“Guizhou Colorful”) (in English, for identification purpose only, Guizhou Colorful Guizhou Town Construction Management Co., Ltd.), a limited liability company established in China on 30 October 2013, in relation to the proposed cooperation in a development project (“Colorful Guizhou Town Project”) of Colorful Guizhou Town（多彩貴州 城）, a commercial, leisure and tourism site to be constructed in Guiyang City, PRC. During the construction and operation phase of Colorful Guizhou Town, the Group will provide design, planning and management, personnel training services to Guizhou Colorful, and will consider investment in and construction of high-end theatres in Colorful Guizhou Town.

The Group does not have a timetable for entering into the formal cooperative agreement with Guizhou Colorful. However, it is provided in the Framework Agreement that if the parties to the Framework Agreement shall not have entered into a formal cooperative agreement regarding the proposed cooperation between the parties by 30 June 2014, the Framework Agreement shall lapse. There is no exclusivity period within which the parties to the Framework Agreement may engage in negotiations before the entering into such formal cooperative agreement.

– 20 –

LETTER FROM THE BOARD

• (ii) pursuant to the Company’s announcement dated 18 December 2013, Fragrant River Entertainment Investment Limited (“Fragrant River Entertainment”), a wholly-owned subsidiary of the Company entered into the cooperation framework agreement (the “FingerAd Framework Agreement”) with FingerAd Media Company Limited (“FingerAd”), a wholly-owned subsidiary of China Railsmedia Corporation Limited (“China Railsmedia”), a company incorporated in the Cayman Islands with limited liability whose issued shares are listed on the Main Board of the Stock Exchange (Stock Code: 745) on 18 December 2013.

The Group does not have a timetable for entering into the formal cooperative agreement with FingerAd. Fragrant River Entertainment and FingerAd will enter into formal cooperative agreement to set out definitive terms of cooperation such as rights and obligations, investment capital, cost allocation and profit distribution within 2 months after (aa) Fragrant River Entertainment and FingerAd being satisfied of the preliminary due diligence results on the subject matters of the FingerAd Framework Agreement; and (bb) the execution of the formal agreement(s) between (A) FingerAd or China Railsmedia or its subsidiaries; and (B) i-Marker Culture & Media Investments Limited (“i-Marker”) pursuant to a memorandum of understanding entered into between i-Marker and FingerAd. If the above conditions are not satisfied prior to 30 May 2014, the FingerAd Framework Agreement will be terminated. There is no exclusivity period within which the parties to the FingerAd Framework Agreement may engage in negotiations before the entering into such formal cooperative agreement.

Pursuant to the FingerAd Framework Agreement, Fragrant River Entertainment and FingerAd intend to cooperate in the following areas:

1. Fragrant River Entertainment shall recommend FingerAd to world class Hollywood and international film and television production companies as strategic partners;

2. Fragrant River Entertainment and FingerAd shall jointly formulate import film plans and strategies;

3. Fragrant River Entertainment shall procure distribution and sales channels for the foreign films and television contents imported by FingerAd; and

4. Fragrant River Entertainment and FingerAd shall jointly invest in the set up of cinema circuits in the PRC.

– 21 –

LETTER FROM THE BOARD

The above cooperation framework agreements only set out the preliminary cooperation intentions and are subject to the entering into formal cooperative agreements by the respective parties setting out definitive terms of cooperation, including but not limited to, the investment amounts, profit sharing arrangements, costs allocations and obligations of each of the respective parties. Once such formal cooperative agreements are entered into, the Group will also apply the net proceeds from the Disposal of HK$58,488,000 to invest into these two investment opportunities. Further announcement(s) in relation to such transactions contemplated under the cooperation framework agreements will be made by the Company as and when appropriate in compliance with the Listing Rules.

Except for the above, the Group had not identified any potential investment and/or initiated any negotiation with potential vendors in relation thereto as at the Latest Practicable Date.

The Group chooses new investment opportunities based on the risks and expected return of the investment. China’s film market shows a good progress in its development. According to the State Administration of Press, Publication, Radio, Film and Television of the PRC（中華人民共和國國家新聞出版廣電總局）, the total accumulated box office in China hit record high and reached RMB21.769 billion for the year ended 31 December 2013, representing an increase of 27.5% as compared to the same period in 2012. Due to the rapid expansion in the entertainment market in China, the Group will firstly consider investing in online entertainment, gaming, culture-related business in the entertainment industry in China and other businesses which are related to the Group’s current core business. As the Group is still actively seeking new investment opportunities, it is premature to disclose the exact size, type, location, business plan of such new investment opportunities. Further announcement(s) in relation to any new investment opportunities will be made by the Company as and when appropriate in compliance with the Listing Rules.

In view of the above, the Group has a medium to long-term funding requirements to invest into new investment opportunities.

The net proceeds from the Disposal, to the extent that the above intended uses have not yet been implemented, may be used by the Group for treasury purposes by placing the net proceeds as fixed deposit in bank(s) or by applying them in the Group’s money lending business to have a fixed rate of return for definitive period. The Company will comply with the relevant notifiable/connected transaction requirements under Chapter 14 and Chapter 14A of the Listing Rules for the new investment opportunities, investment in securities activities and treasury activities.

– 22 –

LETTER FROM THE BOARD

As disclosed in the Company’s 2013 annual report dated 30 September 2013, the Group will continue to adopt its business diversification strategy and develop other new business operations to diversify its sources of income and provide additional resources to finance its core business.

Universe Asia Finance Limited (“UAF”), a wholly-owned subsidiary of the Company, obtained the money lending licence in Hong Kong on 26 November 2013 and started its money lending business in December 2013. UAF sources customers mainly by personal referrals and targets to lend money to high-net-worth individuals and companies each with a total assets value of at least HK$1 million. Due to fierce competition in money lending business, UAF will grant secured or unsecured loans to borrowers in accordance with the situation of each borrower on a case by case basis and, if necessary, will take legal action against borrowers in the event of default. UAF will consider the income/profit and assets of the borrower as a whole in granting any unsecured loan to control the credit risk. As at 31 December 2013, UAF had granted a sum of HK$10 million as unsecured loan to a subsidiary of a listed company (the “Listed Company”) whose shares are listed on GEM. The Listed Company has provided a corporate guarantee to UAF in respect of this loan and there was no default event happened as at the Latest Practical Date. Although the management of the Group does not have experience in managing a money lending business before, the Group will engage professional lawyers and consultants to provide advice to the Group as and when required.

The Group started investing mainly in listed companies in Hong Kong in October 2013. The management of the Group has over 10 years of experience in investing in listed companies in Hong Kong. Nevertheless, the Group will also consider to engage professional parties to advise the Board as and when required. There are no definitive criteria or factors behind the selection of securities for investment by the Group and the management of the Group will consider individual securities on a case by case basis by considering their risks and expected returns. As at 31 December 2013, the Group had invested approximately HK$6.5 million (cost of investment) in listed companies in Hong Kong.

The Group’s investment in securities and its money lending business will become new business segments for the Company for the year ending 30 June 2014.

– 23 –

LETTER FROM THE BOARD

The expected net gain to be derived from the JT Disposal will amount to approximately HK$6,904,000, which represents the sum of (1) the net proceeds of approximately HK$5,058,000 (after deducting the estimated direct expenses for the Disposal) arising from the Disposal; and (2) the aggregate sum of the carrying amounts of the net liabilities value of JT of approximately HK$1,846,000 in the consolidated financial statements of the Group as at 30 November 2013.

The expected net gain to be derived from the UPI Disposal will amount to approximately HK$35,415,000, which represents the sum of (1) the net proceeds of approximately HK$73,430,000 (after deducting the estimated direct expenses for the Disposal) arising from the Disposal; and (2) the aggregate sum of the carrying amounts of the net assets value of UPI of approximately HK$38,015,000 in the consolidated financial statements of the Group as at 30 November 2013.

The expected total net gain to be derived from the JT Disposal and UPI Disposal will amount to approximately HK$42,319,000.

The above calculation is only an estimate provided for illustrative purpose and the accounting treatment of the Disposal will be further discussed with auditors of the Group.

(f) Listing Rules Implications and General Information

As the relevant applicable percentage ratios of the Disposal calculated in accordance with Rule 14.07 of the Listing Rules are more than 5% but less than 25%, the Disposal constitutes a discloseable transaction for the Company under Rule 14.06 of the Listing Rules and is subject to the reporting and announcement requirements under the Listing Rules. Since the Purchaser is the Chairman of the Company and an executive Director, and hence a Connected Person of the Company; and the Considerations exceed HK$10,000,000, the Disposal is also subject to the reporting, announcement and independent shareholders’approval requirements under Chapter 14A of the Listing Rules.

The Company will convene the SGM to approve, among other things, the S&P Agreements and the transactions contemplated thereunder.

As at the Latest Practicable Date, Globalcrest, a substantial and single largest shareholder of the Company, is interested in 359,131,705 Shares representing approximately 20.93% of the issued Shares. As the entire issued share capital of Globalcrest is held by Central Core Resources Limited, the trustee of a discretionary trust under which certain immediate family members of Mr. Lam are discretionary objects, Mr. Lam is deemed to have interest in such 359,131,705 Shares. Hence, Globalcrest, Mr. Lam and their respective associates will abstain from voting at the SGM.

– 24 –

LETTER FROM THE BOARD

The Independent Board Committee has been established to advise and give recommendation to the Independent Shareholders regarding the S&P Agreements. Pan Asia has been appointed by the Group as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders on the S&P Agreements.

3. PROPOSED CONTINUING CONNECTED TRANSACTIONS

(a) Tenancy Agreement

Prior to the UPI Agreement, the Group has been using the Wyler Centre Properties for warehouse, ancillary office and carparking uses. Upon the UPI Completion, the Group will continue to use the Wyler Centre Properties for the same purposes and will through UDE enter into the Tenancy Agreement with UPI.

Parties

• (1) UPI as landlord

• (2) UDE as tenant

UDE is an indirect wholly-owned subsidiary of the Company and is principally engaged in the distribution of films in various videogram formats in Hong Kong.

Premises

The Wyler Centre Properties

Saleable Area (excluding HK Property 2 to HK Property 6)

Approximately 13,983 square foot

Term

36 months commencing from the date of the UPI Completion

Rental

HK$244,000 per month (exclusive of Rates, Government Rent and management fee) payable monthly

– 25 –

LETTER FROM THE BOARD

The annual rental (inclusive of Rates, Government Rent and management fee) paid by the Group to UPI in respect of the Wyler Centre Properties for the financial years ended 30 June 2012, 30 June 2013 and 5 months period ended 30 November 2013 was HK$600,000, HK$600,000 and HK$205,000, respectively. Assuming the term of the Tenancy Agreement commences at the beginning of February 2014 when the UPI Completion is expected to occur, the annual rental expected to be paid by the Group to UPI in respect of the Wyler Centre Properties for the financial year ending 30 June 2014 will be approximately HK$1,220,000.

Annual Cap

Based on the monthly rental of HK$244,000 payable under the Tenancy Agreement, the maximum aggregate amount payable under the Continuing Connected Transactions for the 5 months ending 30 June 2014 (assuming the term of the Tenancy Agreement commences at the beginning of February 2014 when the UPI Completion is expected to occur), 12 months ending 30 June 2015, 12 months ending 30 June 2016 and 7 months ending 31 January 2017 will not exceed HK$1,220,000, HK$2,928,000, HK$2,928,000 and HK$1,708,000, respectively.

(b) Reasons for the Continuing Connected Transactions

As the Group has been using the Wyler Centre Properties since early 2000, the Directors consider that there will be considerable time and cost saving (in terms of relocation and renovation) for the Group to continue to lease the Wyler Centre Properties from UPI.

Prior to the UPI Disposal, as the Wyler Centre Properties were properties of UPI, and used by UPI and other members of the Group, charging a monthly rental of HK$50,000 was considered and determined by the Directors to be appropriate in the circumstances. The Tenancy Agreement will only become effective after the UPI Completion. The terms of the Tenancy Agreement (including the monthly rental of HK$244,000) were arrived at following arm’s length negotiations between the Group and Mr. Lam (who will become the beneficial owner of UPI after the UPI Completion) with reference to the Rental Valuation performed by RAL as at 30 November 2013 which reflects the then market rent.

The Directors (except Mr. Lam who abstained from participating in the approval of the Tenancy Agreement due to his material interests therein), including the independent nonexecutive Directors, consider that the Continuing Connected Transactions are in the ordinary and usual course of business of the Company; and the terms of the Tenancy Agreement are based on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

– 26 –

LETTER FROM THE BOARD

(c) Listing Rules Implications

Upon the UPI Completion, UPI will be beneficially owned by Mr. Lam who is a Connected Person. Accordingly, the Tenancy Agreement will constitute continuing connected transactions for the Company under the Listing Rules. The applicable percentage ratios for the Continuing Connected Transactions are less than 5%. Therefore, the Tenancy Agreement will satisfy the exemption under Rule 14A.34(1) of the Listing Rules and will only be subject to the reporting and the announcement requirements set out in Rules 14A.45 to 14A.47, the annual review requirements set out in Rules 14A.37 to 14A.40, of the Listing Rules, and will be exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. If the Tenancy Agreement is materialised, appropriate disclosure of the transactions contemplated under the Tenancy Agreement will be made in the next published annual reports and accounts of the Company in accordance with the Listing Rules.

4. RE-ELECTION OF RETIRING DIRECTORS

Each of Mr. Choi and Mr. C.K. Lam was appointed as an independent non-executive Director by the Board with effect from 4 December 2013 to fill the casual vacancy arising from the resignations of two independent non-executive Directors. Pursuant to Bye-Law 86(2) of the ByeLaws, each of Mr. Choi and Mr. C.K. Lam shall hold office until the SGM and being eligible, offers himself for re-election at the SGM.

Biographical details of each of Mr. Choi and Mr. C.K. Lam are as follows:

Mr. Choi

Mr. Choi, aged 36, holds a bachelor’s degree of business administration in accounting awarded by the Hong Kong University of Science and Technology in 1999. Mr. Choi is a fellow of the Association of Chartered Certified Accountants and a member of the Hong Kong Institute of Certified Public Accountants. Mr. Choi has around 13 years of experience in accounting and company secretarial field. Mr. Choi is currently an independent nonexecutive director of Zhidao International (Holdings) Limited (Stock Code: 1220), and between 1 September 2010 and 22 April 2013, Mr. Choi was the financial controller and company secretary of Taung Gold International Limited (Stock Code: 621), each being a company whose shares are listed on the Stock Exchange.

Mr. Choi was also appointed as a member of the Audit Committee of the Board, the chairman of the Remuneration Committee of the Board and a member of the Nomination Committee of the Board.

– 27 –

LETTER FROM THE BOARD

As at the Latest Practicable Date, save as disclosed above, Mr. Choi did not hold any other major appointment and qualification or directorship in other listed company in the last three years, nor did he have any relationship with any Director, senior management, substantial shareholders or controlling shareholders (having the meaning ascribed to it in the Listing Rules) of the Company. Save as mentioned above, Mr. Choi does not hold other positions in the Company or other members of the Group.

As at the Latest Practicable Date, Mr. Choi was not interested in any Shares within the meaning of Part XV of the SFO.

Pursuant to the appointment letter entered into between Mr. Choi and the Company, Mr. Choi is appointed for a fixed term of three years from 4 December 2013. Mr. Choi’s appointment shall be subject to retirement by rotation and re-election at general meetings of the Company in accordance with the Bye-Laws. Mr. Choi is entitled to an annual Director’s fee of HK$130,000 which is determined with reference to their responsibilities, the Company’s remuneration policy and the prevailing market conditions.

Save as disclosed above, there is no further information to be disclosed pursuant to the requirements of Rules 13.51(2)(h) to (v) of the Listing Rules and there are no other matters relating to the re-election of Mr. Choi that needs to be brought to the attention of the Shareholders.

Mr. C.K. Lam

Mr. C.K. Lam, aged 43, holds a bachelor’s degree of science in accounting awarded by Brigham Young University-Hawaii in 1996. Mr. C.K. Lam also obtained a master’s degree of science in e-commerce from The Chinese University of Hong Kong in 2002. Mr. C.K. Lam is a fellow member of the Hong Kong Institute of Certified Public Accountants, a holder of the specialist designation in insolvency of the Hong Kong Institute of Certified Public Accountants and a certified fraud examiner of the Association of Certified Fraud Examiners. Mr. C.K. Lam has around 15 years of experience in accounting and the insolvency field. He is currently the group financial controller and company secretary of Ngai Shun Holdings Limited (Stock code: 1246).

Mr. C.K. Lam was also appointed as a member of the Audit Committee of the Board, a member of the Remuneration Committee of the Board and the chairman of the Nomination Committee of the Board.

– 28 –

LETTER FROM THE BOARD

As at the Latest Practicable Date, save as disclosed above, Mr. C.K. Lam did not hold any other major appointment and qualification or directorship in other listed company in the last three years, nor did he have any relationship with any Director, senior management, substantial shareholders or controlling shareholders (having the meaning ascribed to it in the Listing Rules) of the Company. Save as mentioned above, Mr. C.K. Lam does not hold other positions in the Company or other members of the Group.

As at the Latest Practicable Date, Mr. C.K. Lam was not interested in any Shares within the meaning of Part XV of the SFO.

Pursuant to the appointment letter entered into between Mr. C.K. Lam and the Company, Mr. C.K. Lam is appointed for a fixed term of three years from 4 December 2013. Mr. C.K. Lam’s appointment shall be subject to retirement by rotation and re-election at general meetings of the Company in accordance with the Bye-Laws. Mr. C.K. Lam is entitled to an annual Director’s fee of HK$130,000 which is determined with reference to their responsibilities, the Company’s remuneration policy and the prevailing market conditions.

Save as disclosed above, there is no further information to be disclosed pursuant to the requirements of Rules 13.51(2)(h) to (v) of the Listing Rules and there are no other matters relating to the re-election of Mr. C.K. Lam that needs to be brought to the attention of the Shareholders.

5. SGM

The SGM will be convened by the Company at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong on Wednesday, 19 February 2014 at 2:30 p.m., or in the event that a black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day, at the same time and place on the second Business Day after 19 February 2014 (or any adjournment thereof), for the Shareholders to consider and, if thought fit, pass the Ordinary Resolutions to approve, among other things, the S&P Agreements and the transactions contemplated thereunder and the re-election of the retiring Directors.

– 29 –

LETTER FROM THE BOARD

There is a form of proxy for use at the SGM accompanying this circular. If you are not able to attend the SGM (or any adjournment thereof), you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return it to the principal place of business of the Company in Hong Kong at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong as soon as possible and in any event not later than forty-eight (48) hours before the time appointed for holding the SGM (or any adjournment thereof). Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM (or any adjournment thereof) if you so wish.

In accordance with Rule 13.39(4) of the Listing Rules, all the resolutions proposed at the SGM will be voted on by way of poll except where the chairman of the SGM, in good faith, decide to allow a resolution which relates purely to procedural or administrative matter to be voted on by a show of hands. The chairman of the SGM will at the meeting demand, pursuant to Bye-Law 66(a), voting by way of poll on the Ordinary Resolutions. On a poll, subject to any special rights or restrictions as to voting for the time being attached to any Shares by or in accordance with the ByeLaws, every Shareholder present in person (or being a corporation, is present by a representative duly authorised), or by proxy shall have one vote for every fully paid Share of which he/she is the holder.

After closure of the SGM, the Company will publish an announcement in respect of the poll results on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.uih.com.hk) respectively.

6. INDEPENDENT BOARD COMMITTEE

The Independent Board Committee comprising of all the independent non-executive Directors has been constituted by the Company to advise the Independent Shareholders as regards the terms of the S&P Agreements and the transactions contemplated thereunder.

7. INDEPENDENT FINANCIAL ADVISER

Pan Asia has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders as regards the terms of the S&P Agreements. The appointment of Pan Asia as the independent financial adviser has been approved by the Independent Board Committee.

– 30 –

LETTER FROM THE BOARD

8. RECOMMENDATION

The Independent Board Committee having considered the advice of Pan Asia, considers that the S&P Agreements are on normal commercial terms and the terms of the S&P Agreements are fair and reasonable so far as the Company and the Independent Shareholders are concerned and the entering into of the S&P Agreements is in the interests of the Company and the Independent Shareholders as a whole. The S&P Agreements are inter-conditional. Accordingly, the Independent Board Committee recommends the Independent Shareholders to vote in favour of the Ordinary Resolutions to be proposed at the SGM to approve the S&P Agreements and the transactions contemplated thereunder.

The Directors (excluding Mr. Lam and the Independent Board Committee, and the views of the Independent Board Committee are expressed in the letter from the Independent Board Committee) consider that the S&P Agreements are on normal commercial terms and the terms of the S&P Agreements are fair and reasonable so far as the Company and the Independent Shareholders are concerned and the entering into of the S&P Agreements is in the interests of the Company and the Independent Shareholders as a whole. Accordingly, the Directors (excluding Mr. Lam and the Independent Board Committee, and the views of the Independent Board Committee are expressed in the letter from the Independent Board Committee) recommend the Independent Shareholders to vote in favour of the Ordinary Resolutions to approve the S&P Agreements and the transactions contemplated thereunder.

The Directors (including the independent non-executive Directors) are also of the opinion that the re-election of retiring Directors is fair and reasonable and is in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors (including the independent non-executive Directors) recommend that all Shareholders should vote in favour of the Ordinary Resolutions to approve the re-election of the retiring Directors.

Your attention is drawn to the letter from the Independent Board Committee set out on page 32 of this circular and the letter from Pan Asia set out on pages 33 to 45 of this circular which contains its advice to the Independent Board Committee and the Independent Shareholders, and the principal factors and reasons having been taken into consideration by Pan Asia.

9. ADDITIONAL INFORMATION

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

Yours faithfully,

For and on behalf of the Board Lam Shiu Ming, Daneil Chairman

– 31 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

UNIVERSE INTERNATIONAL HOLDINGS LIMITED 寰宇國際控股有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1046)

29 January 2014

To the Independent Shareholders

Dear Sir/Madam,

DISCLOSEABLE AND CONNECTED TRANSACTION RELATING TO DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL IN UNIVERSE PROPERTY INVESTMENT LIMITED AND

JOY TALENT INVESTMENT LIMITED AND

PROPOSED CONTINUING CONNECTED TRANSACTIONS RELATING TO LEASING OF WYLER CENTRE PROPERTIES AND RE-ELECTION OF DIRECTORS

As the Independent Board Committee, we have been appointed to advise you in respect of the S&P Agreements, details of which are set out in the “Letter from the Board” in the circular dated 29 January 2014 (the “Circular”) of which this letter forms part. The terms used in this letter shall have the same meanings as defined in the Circular, unless the context otherwise requires.

We wish to draw your attention to the “Letter from the Independent Financial Adviser” containing its advice to us regarding the S&P Agreements as set on pages 33 to 45 of the Circular. Having considered the advice given by the Pan Asia and the principal factors and reasons taken into consideration by them in arriving at their advice, we are of the opinion that the terms of the S&P Agreements are on normal commercial terms and the terms of the S&P Agreements are fair and reasonable so far as the Company and the Independent Shareholders are concerned and the entering into of the S&P Agreements is in the interests of the Company and the Independent Shareholders as a whole. We therefore recommend the Independent Shareholders to vote in favour of the Ordinary Resolutions to approve, inter alia, the S&P Agreements and the transactions contemplated thereunder set out on pages 82 to 83 of the Circular.

Yours faithfully,

For and on behalf of the Independent Board Committee Lam Wing Tai Choi Wing Koon Lam Chi Keung Independent Non-Executive Directors

• for identification purpose only

– 32 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

The following is the full text of advice to the Independent Board Committee and the Independent Shareholders in respect of the proposed discloseable and connected transaction, which has been prepared for the purpose of inclusion in this circular.

Pan Asia Corporate Finance Limited

Unit 1504, 15th Floor The Centre 99 Queen’s Road Central, Central, Hong Kong 29 January 2014

To: The Independent Board Committee and

the Independent Shareholders

Dear Sirs,

DISCLOSEABLE AND CONNECTED TRANSACTION

INTRODUCTION

We refer to our appointment as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders of Universe International Holdings Limited (the “Company”) on the terms of the S&P Agreements, details of which are set out in the section headed “Letter from the Board” in the circular of the Company to the Shareholders dated 29 January 2014 (the “Circular”), of which this letter forms part. Unless the context otherwise requires, capitalised terms used in this letter shall have the same meanings as those defined in the Circular.

According to the Company’s announcement dated 10 December 2013 (the “Announcement”), the JT Vendor entered into the JT Agreement with the Purchaser pursuant to which the JT Vendor has conditionally agreed to sell, and the Purchaser has conditionally agreed to purchase, the JT Sale Share for the JT Consideration of HK$6,277,000.

The Company further announced on the same day that the UPI Vendors entered into the UPI Agreement with the Purchaser under which the UPI Vendors conditionally agreed to sell, and the Purchaser conditionally agreed to purchase, the UPI Sale Share for the UPI Consideration of HK$73,862,000.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

As the relevant applicable percentage ratios of the Disposal calculated in accordance with Rule 14.07 of the Listing Rules are more than 5% but less than 25%, the Disposal constitutes a discloseable transaction for the Company under Rule 14.06 of the Listing Rules, and is subject to the Listing Rules’ reporting and announcement requirements.

In addition, since (i) the Purchaser is the Chairman and an executive Director of the Company, a Connected Person under the Listing Rules, and (ii) the Considerations exceed HK$10,000,000, the Disposal also constitutes a connected transaction as defined under Chapter 14A of the Listing Rules and hence is subject to the reporting, announcement and independent shareholders’ approval requirements set out in that Chapter.

For Independent Shareholders to approve the Disposal, the Listing Rules require that a majority of them vote in favour of the resolutions to approve the Disposal to be proposed at a SGM. As per Rule 14A.54 of the Listing Rules, the Purchaser, Globalcrest and their respective associates are not allowed to vote on the resolutions to approve the Disposal.

Rule 14A.21 of the Listing Rules further requires that the Company establish an Independent Board Committee, which comprises the Company’s independent non-executive Directors without any material interest in the Disposal, namely, Mr. Lam Wing Tai, Mr. Choi Wing Koon and Mr. Lam Chi Keung, to advise the Independent Shareholders on the terms of the Disposal.

In the capacity of the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders, we are required to advise them on three specific issues, namely, (i) whether or not the S&P Agreements are on normal commercial terms and are fair and reasonable as far as the Company and the Independent Shareholders are concerned; (ii) whether or not the terms of the S&P Agreements are in the interests of the Company and the Shareholders as a whole; and (iii) how the Independent Shareholders should vote in respect of the resolutions to approve the S&P Agreements and the transactions relating to them.

BASIS OF OUR OPINION

In formulating our opinion, we have reviewed, inter alia, the Announcement, the S&P Agreements and RAL’s valuation reports contained in Appendix I to the Circular. We have also reviewed certain information and facts provided by the management of the Company relating to the financial condition of the Group. Based on the foregoing, we consider that we have taken all the reasonable steps, which are applicable to the Disposal, as referred to and required under Rule 13.80(2)(b) of the Listing Rules (including its annexed notes) in forming our opinion.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

We have also (i) considered such other information, analyses and market data as we deemed relevant; and (ii) conducted discussions with the management of the Company regarding the terms of the S&P Agreements, the businesses and the future outlook of the Group.

All Directors collectively and individually accept full responsibility for the purpose of providing information with regard to the Company in the Circular and, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in the Circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters not contained in the Circular, the omission of which would make any statement herein or in the Circular misleading.

We consider that we have been provided with, and we have reviewed, all currently available information and documents which are available under present circumstances to enable us to reach an informed view regarding the terms of, and reasons for, the Disposal and to justify reliance on the accuracy of the information contained in the Circular so as to provide a reasonable basis of our opinion. We have no reason to suspect that any material information has been withheld by the Directors or the management of the Company, or is misleading, untrue or inaccurate.

We have not, however, for the purpose of this exercise, conducted any independent detailed investigation, site-visit or audit into the businesses or affairs or future prospects of the Group. Our opinion is necessarily based on financial, economic, market and other conditions in effect, and the information made available to us, as at the date of the Circular, and we will not be held accountable for the completion or non-completion of the Disposal and the outcome and consequences (if any) of the completion of the Disposal, if at all.

This letter is issued for the information for the Independent Board Committee and the Independent Shareholders solely in connection with their consideration of the S&P Agreements, and, except for its inclusion in the Circular, is not to be quoted or referred to, in whole or in part, nor shall this letter be used for any other purposes, without our prior written consent.

Apart from the normal advisory fee payable to us in connection with our appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders, no arrangement exists under which we shall receive any other fees or benefits from the Company. We are independent from the Company for the purposes of Rule 13.84 of the Listing Rules.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion and recommendation, we have considered the following factors.

(A) Background to the Disposal

Information on the Group

The Group mainly operates in three business segments: distribution of films in various videogram formats segment, film exhibition, licensing and sub-licensing of film rights segment, and leasing of investment properties.

In its annual report for the year ended 30 June 2013, the Company remarked that the year of 2012-2013 was another challenging one for the Group. This is because during the year, the local video distribution business continued to be affected by the unfavourable market environment. Nevertheless, this was offset by revenue growth from film exhibitions and the licensing and sub-licensing of film rights. Consequently, the Group’s total revenue for the year has maintained at a similar level compared with last year. In particular, the revenue and gross profit from film exhibitions in the year under review was considered to be satisfactory.

During the year, the revenue of the Group slightly increased by 4.2% over the same period last year to HK$79.1 million, while the loss attributable to the equity holders of the Company narrowed by 73.1% from HK$17.4 million (restated) to HK$4.7 million. Loss per share for the year was HK0.27 cents compared to HK1.02 cent (restated) in 2012.

Information on JT

JT was incorporated under the Companies Ordinance and is an indirect whollyowned subsidiary of the Company. Its principal asset is the PRC Property which comprises an office unit with a gross floor area of 3,029 square feet in a large scale residential/office/commercial composite development, known as Jianwai SOHO, completed in about 2006. The land use rights of the PRC Property have been granted for a term expiring on 4 August 2052 for office use. The Group purchased the PRC Property in 2006 and has been holding it, via JT Vendor, for future use.

The PRC Property was stated at its cost less accumulated depreciation at each balance sheet date in the financial statements of JT and the consolidated financial statements of the Group.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

The following is JT’s financial information for the two years ended 30 June 2012 and 30 June 2013 and 5 months period ended 30 November 2013:

			5 months
	Year ended	Year ended	period ended
	30 June 2012	30 June 2013	30 November 2013
	HK$’000	HK$’000	HK$’000
Total assets	5,388	5,251	5,194
Net (liabilities)	(1,440)	(1,745)	(1,846)
(Loss) before tax and
extraordinary items	(334)	(305)	(101)
(Loss) after tax and
extraordinary items	(334)	(305)	(101)

Information on UPI

Similar to JT, UPI was incorporated under the Companies Ordinance and is an indirect wholly-owned subsidiary of the Company. However, UPI’s principal assets include various properties collectively known as the HK Properties, which include:

1. HK Property 1:–

2. Unit 1 on 18th floor, Wyler Centre Phase II, Nos. 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong, which is an industrial unit on the 18th floor of a 28-storey industrial building over a 2-storey lorry/car parking podium plus a 2-level basement (with a saleable area of approximately 13,983 square foot). The building was completed in 1989.

3. HK Property 2 to HK Property 6:–

4. Five car parking space Nos. P1, P24, P25, P26 and P41 on the 2nd floor, Wyler Centre Phase II.

5. HK Property 7:–

6. Room B, Unit 2 on 18th floor, Wyler Centre Phase II.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

1. HK Property 8:–

2. No. 61, 1st Street, Section M, Fairview Park, Yuen Long, which is a detached house situated in a large-scale low-rise residential development known as Fairview Park which was completed in 1977. The property has a gross floor area of about 1,297 square feet.

3. HK Property 9:–

4. Factory K on the 16th floor of Block 3, Golden Dragon Industrial Centre, Nos. 172-180 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong, which is a unit on the 16th floor of a 26-storey industrial building including 2-storey car park podium known as Golden Dragon Industrial Centre completed in 1978. The property has a saleable floor area of about 1,000 square feet.

HK Property 1 to HK Property 7 have been held by the Group for more than 10 years; and HK Property 8 to HK Property 9 have been held by the Group for more than 2 years for the purposes as shown in each of the following balance sheets:

		Consolidated Balance	Consolidated Balance	Sheet as at
				5 month
		Year ended	Year ended	period ended
		30 June 2012	30 June 2013	30 November 2013
HK Property	1	own use	own use	own use
HK Property	2	own use	own use	own use
HK Property	3	own use	own use	own use
HK Property	4	own use	own use	own use
HK Property	5	investment	own use	own use
HK Property	6	investment	own use	own use
HK Property	7	own use	investment	investment
HK Property	8	investment	investment	investment
HK Property	9	investment	investment	investment

In the consolidated financial statements of the Group, the properties held for the Group’s own use were stated at their cost less accumulated depreciation as property, plant and equipment, while the properties held for investment purpose were stated at their fair values as investment properties at each balance sheet.

– 38 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

The following is UPI’s financial information for the two years ended 30 June 2012 and 30 June 2013 and 5 months period ended 30 November 2013.

			5 months
	Year ended	Year ended	period ended
	30 June 2012	30 June 2013	30 November 2013
	HK$’000	HK$’000	HK$’000
Total assets	94,773	110,741	74,110
Net assets	80,142	95,225	73,862
Profit before tax and
extraordinary items
(note 1)	4,542	14,991	5,743
Profit after tax and
extraordinary items
(note 1)	4,643	15,083	5,765

(B) Reasons and benefits of the Disposal

Given that the recent real property markets in the PRC and Hong Kong have been quite buoyant and the values of the Properties have appreciated, the Directors consider that it is in the interests of the Company and the Shareholders to dispose of the Properties capitalising on favourable market conditions in order to realise a capital gain and enhance the working capital position of the Group.

According to the Company, the net proceeds (after deducting the estimated direct expenses for the Disposal) arising from the Disposal are expected to be approximately HK$78,488,000. The Company intends to utilise approximately HK$10,000,000 of these proceeds for general working capital to pay the daily administrative expenses of the Group, approximately HK$10,000,000 for the investments in listed securities, and approximately HK$58,488,000 for the development of new investment opportunities including, but not limited to, a joint venture company (“JV Company”) to be set up with Computech Holdings Limited (“Computech”), a company incorporated in the Cayman Islands with limited liability whose issued shares are listed on GEM (Stock Code: 8081), in order to engage in the development and sale of computer and mobile phone games. The maximum investment in the JV Company shall be HK$40,000,000, which shall be contributed as to 50% by Computech and 50% by the Group. Further details of the establishment of the JV Company can be found in the Company’s announcement dated 5 December 2013.

– 39 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

In addition, the Company has also entered into two co-operation framework agreements in the second half of 2013 with Guizhou Colorful Guizhou Town Construction Management Co. Ltd, and FingerAd Media Company Limited. Details of these two agreements can be found in the Company’s announcements dated 30 October 2013 and 18 December 2013 respectively as well as on pages 20 to 22 of the Circular. The Group will apply HK$58,488,000 from the net proceeds from the Disposal to invest into these two investment opportunities. Further announcements in relation to these transactions will be made by the Company in due course.

The net proceeds from the Disposal, to the extent that the above intended uses have not yet been implemented, may be used by the Group for treasury purposes by placing the net proceeds as fixed deposit in bank(s) or by applying them in the Group’s money lending business to have a fixed rate of return for a definite period. The Company will comply with the relevant notifiable/connected transaction requirements under Chapter 14 and Chapter 14A of the Listing Rules for the new investment opportunities, investment in securities activities and treasury activities.

In a recently released research report entitled Emerging Trends in Real Estate® Asia Pacific 2014 (the “Report”) (http://uli.org/up-content/uplaods/ULI-Documents/EmergingTrends-In-Real-Estate-Asia-Pacific-2014.pdf), researchers from the Urban Land Institute (“ULI”) and PricewaterhouseCoopers (“PWC”) indicated that real estate fundamentals are expected to remain strong in markets throughout Asia in 2014. This is because unlike other asset classes, real estate in Asia “barely flinched” in response to the tapering of the U.S. economic stimulus and expectations of higher interest rates. This is due, in part, to the increase in sovereign wealth and institutional capital being directed to Asian markets, as well as the substantial volume of Asian capital being exported from China, Singapore and South Korea into real estate assets across the region.

However, the Report sounded a warning for the Hong Kong property market as it said that international funds had bypassed it in recent times. Among the reasons for the lack of interest in Hong Kong’s properties cited by the Report were (i) the Hong Kong government’s cooling measures which imposed a doubling of stamp duty for property transactions; and (ii) given Hong Kong’s currency link to the US dollar, the city is seen as especially sensitive to the impact of rising interest rates that are widely expected to materialise in 2014. Insofar as the China property market is concerned, the Report found that not only were good-quality, well-leased assets in China hard to come by, they were also prohibitively expensive. As a result, most foreign investors had been shying away from buying core assets in China.

– 40 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

Similar negative forecasts for Hong Kong and Mainland China’s property markets in 2014 have also been expressed by Knight Frank Hong Kong in a press release dated 3 December 2013 (http://www.knightfrank.com.hk/en/news/03-12-2013/cnhk2014-c). Conflicting signals for the outlook of the Hong Kong property market in 2014 can also be found in two other research reports, namely, Encouraging Signs for 2014 (http://www. joneslanglasalle.com/GMP/en-gb/Documents/Fourth-Quarter-2013/pdf/Global_Market_ Perspective_Q4%202013.pdf) and Schroders Outlook – 2014: Global Securities (http:// www.schroders.com/staticfiles/Schroders/Sites/Americas/US%20Institutional%202011/pdfs/ A-Year-In-Global-Property.pdf).

As the property values in China and Hong Kong in general have been on a upward trend for the last few years, the inherent risk in these two property markets has increased and market sentiment is becoming more cautious as expressed by market analysts over the prospects of the property markets in Hong Kong and China, the Directors considered that the Group is necessarily faced with a relatively limited choice of potential buyers of the Properties.

The Purchaser of the Properties in this case, Mr. Lam, is the Chairman and an executive Director of the Company and has been involved as part of the Group’s management team ever since the Group was founded in 1986. Mr. Lam has had over 25 years of business experience in Hong Kong’s film industry and successfully led the Company to achieve listing on the Stock Exchange of Hong Kong Limited in 1999. In 2002 Mr. Lam received the award of Young Industrialist of Hong Kong, which was established by the Federation of Hong Kong Industries in 1988 as a means to recognise the outstanding achievements of industrialists between the ages of 21 and 45 in the manufacturing sector.

In light of the property market cooling measures taken by the governments in Hong Kong and the PRC, we believe that the Disposal provides an opportunity for the Company to realise a capital gain and enhance the working capital of the Group through the cash proceeds from the Disposal and is in the interests of the Company and the Shareholders. On the other hand, the sale of the Properties to Mr. Lam at current market values and the leasing back of the Wyler Centre Properties from Mr. Lam saves transaction time and costs and minimises disruption to the operation of the Group.

In view of the fact that (i) the property market is becoming more vulnerable to the general market volatility and its upward and downward trends cannot be predicted with precision; and given that (ii) Mr. Lam is prepared to purchase the Properties at or around market prices (see the discussion in the section headed by “Valuation report by RAL”), we consider that the Disposal of the Properties to Mr. Lam to be commercially sensible and in the interests of the Company and the Shareholders as a whole.

– 41 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

(C) Terms of the Disposal

As per the S&P Agreements, which comprise the JT Agreement and UPI Agreement, the JT Consideration of HK$6,277,000 in cash is the total amount that the purchaser has agreed with the JT vendor to purchase the entire issued share capital of JT. On JT Completion, the purchaser agrees to settle a debt of approximately HK$6,428,513 owed by JT to JT Vendor on behalf of JT. Apart from such debt, there are no other inter-company balances between JT and other members of the Group which required to be settled on JT Completion.

The UPI Consideration HK$73,862,000, on the other hand, is the total amount of cash consideration agreed between the purchaser and the UPI Vendors for the purchaser to purchase the UPI Sale Shares which represent the entire share capital of UPI.

Further details of other terms and conditions of the S&P Agreements have been set out in the Letter from the Board which may be referred to.

Amount of consideration

As stated in the Letter from the Board, The JT Consideration was arrived at after arm’s length negotiations between the JT Vendor and the Purchaser after taking into account (i) the unaudited net liabilities of JT of approximately HK$1,846,000 as at 30 November 2013; (ii) the increase in the fair value of the PRC Property of approximately HK$8,123,000 as compared to its net carrying value of approximately HK$5,191,000 as at 30 November 2013, which is based on the valuation of the PRC Property of approximately HK$13,314,000 (RMB10,380,000) as at 30 November 2013 performed by RAL.

The UPI Consideration was arrived at after arm’s length negotiations between the UPI Vendors and the Purchaser after taking into account the unaudited net assets value of UPI of approximately HK$73,862,000 as at 30 November 2013, which was the total amount of the HK Properties valued by RAL in its report.

According to the S&P Agreements, JT’s authorised share capital is HK$10,000 and is divided into 10,000 ordinary shares of HK$1 each. One of the shares has been issued and fully paid up and owned legally and beneficially by the JT Vendor. UPI’s authorised share capital is also HK$10,000 divided into 10,000 ordinary shares of HK$1 each. Two of the ordinary shares have been issued and fully paid up. UFH legally owned one of the shares issued while ULV owned the other share issued.

– 42 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

In our review of JT’s management accounts as at 30 November 2013 (being the latest practicable date for ascertaining information contained in the Company’s announcement of 10 December 2013), we note that JT had an issued share capital of HK$10,000 and a net deficit of HK$101,211.86. Its principal asset was the PRC Property. By contrast, the review of UPI’s management accounts show that UPI had a net profit of HK$5,765,079.25.

Valuation report by RAL

In assessing the total cash consideration of the Disposal, we have considered the valuation of the PRC Property and HK Properties by RAL in its report dated 10 December 2013, a copy of which was appended to the Circular as Appendix I.

According to RAL, the valuation of the PRC Property and HK Properties are its opinion of the market values of these properties which are defined to mean “the estimated amount for which an asset ... should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction ... wherein the parties had each acted knowledgeably, prudently and without compulsion”.

RAL has conveniently classified the PRC property and the HK Properties into three groups:

1. Properties held by the Group for owner-occupation in Hong Kong which include HK Property 1 to HK Property 6.

2. Properties held by the Group for investment purpose in Hong Kong which consist of HK Property 7, HK Property 8 and HK Property 9.

3. Property held by the Group for owner-occupation purposes in the PRC, which is the PRC property.

RAL has valued the properties in Groups 1 and 2 by the direct comparison approach which assumes sale of the properties in their present state with the benefit of vacant possession and by referring to comparable sales transactions in the current market. As for its valuation of the PRC Property (Group 3), RAL has referred to sales evidence available in the market and, where appropriate, on the basis of capitalisation of the net rental income shown on schedules handed to staff of RAL.

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LETTER FROM INDEPENDENT FINANCIAL ADVISER

In examining the valuation figures of the properties in Groups 1, 2 and 3, we have requested and been provided with evidence showing comparable sales transactions in respect of similar types of properties. For example, in respect of HK Property 1 and HK Property 7 of Group 1, we have been provided with a list showing units on various floors of Wyler Centre Phrase II with different gross and net areas and their respective transaction values. In relation to the PRC Property (Group 3), we have also studied the evidence provided by RAL which showed the selling prices of similar properties in Jianwai SOHO. Based on the information provided by RAL, we believe the considerations reflected current market values of similar properties at relevant locations.

Insofar as the PRC Property is concerned, it comprises an office unit with a gross floor area of 3,029 square foot in a large scale residential/office/commercial composite development, known as Jianwai SOHO. The subject building was completed in about 2006. The PRC Property was acquired by the Group in 2006 and has been held for own use by the Group. As the business operation of the Group in Beijing is not material, we are of the view that the disposal of the PRC Property will not have any material impact on the operation of the Group.

(D) Impact on the Company’s finances as a result of the Disposal

According to the Company, the net proceeds arising from the Disposal are expected to be approximately HK$78,488,000. The expected net gain to be derived from the Disposal will amount to approximately HK$42,319,000 which represents the difference between the net proceeds (after deduction of direct expenses of the Disposal) and the aggregate sum of the carrying amounts of the net assets of the JT and UPI of approximately HK$36,169,000 in the consolidated financial statements of the Company as at 30 November 2013, subject to any accounting modifications as suggested by the auditors of the Company. As a result, the Disposal will generate some HK$78 million cash and HK$42 million profit to the Company.

Based on the unaudited financial statements of UPI and JT as at 30 November 2013 provided by the Company, the combined net assets value of UPI and JT stood at HK$72 million. The Disposal is in the ordinary and usual course of business of the Company and based on current market values of the Properties, it will generate about HK$78 million cash and after deducting some HK$36 million carrying value of JT and UPI on the consolidated financial statements of the Group, it is envisaged that there will be an increase of HK$42 million to the current asset of the consolidated financial statement and consequently the Disposal will have a positive financial impact on the net asset value of the Group.

– 44 –

LETTER FROM INDEPENDENT FINANCIAL ADVISER

RECOMMENDATION

In formulating our recommendation to the Independent Board Committee and the Independent Shareholders, we have considered the above factors and reasons, in particular the following:

• (1) Given the difficult commercial environment in which the Group operates, it is commercially sensible for it to sell the Properties to Mr. Lam, who has been part of the Group’s management team for over 25 years.

• (2) The prices that Mr. Lam has agreed to pay for purchasing the Properties are considered to be at or around market prices.

• (3) The Disposal is estimated to generate some HK$78 million cash and HK$42 million in profit to the Company, thereby enhancing the Company’s net assets position.

Accordingly, we are of the opinion that (i) the S&P Agreements are on normal commercial terms and that the terms of the Agreements are fair and reasonable so far as Company and the Independent Shareholders are concerned; and that (ii) the entering into the S&P Agreements is in the interests of the Company and the Independent Shareholders as a whole. We therefore recommend the Independent Board Committee to advise the Independent Shareholders to vote in favour of the relevant resolutions to be proposed at the SGM to approve the S&P Agreements (and the transactions contemplated under them).

Yours faithfully

For and on behalf of

Pan Asia Corporate Finance Limited Billy C. W. Cheung Chairman

– 45 –

VALUATION REPORT

APPENDIX I

The following is the full text of a report from RAL prepared for the purpose of inclusion in this circular.

==> picture [96 x 55] intentionally omitted <==

Unit 3806, 38/F, China Resources Building, 26 Harbour Road, Wan Chai, Hong Kong Tel (852) 2529 6878 Fax (852) 2529 6806 E-mail info@romagroup.com http://www.romagroup.com

29 January 2014

Universe International Holdings Limited 18th Floor, Wyler Centre Phase II Nos.192-200 Tai Lin Pai Road Kwai Chung New Territories Hong Kong

Dear Sir/Madam,

Re: Various Properties in Hong Kong and the People’s Republic of China

In accordance with your instructions for us to value the properties held by Universe International Holdings Limited (the “Company”) and/or its subsidiaries (together with the Company referred to as the “Group”) in Hong Kong and the People’s Republic of China (the “PRC”), we confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market values of the properties as at 30 November 2013 (the “Date of Valuation”) for the purpose of incorporation in the Circular of the Company dated 29 January 2014.

1. BASIS OF VALUATION

Our valuations of the properties are our opinion of the market values of the concerned properties which we would define as intended to mean “the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion”.

Market value is understood as the value of an asset or liability estimated without regard to costs of sale or purchase (or transaction) and without offset for any associated taxes or potential taxes.

– 46 –

VALUATION REPORT

APPENDIX I

For the assessment of market rents, we would define as intended to mean “the estimated amount for which a property would be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm’s-length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion”.

2. PROPERTY CATEGORIZATION

In the course of our valuations, the properties owned by the Group are categorized into the following groups:

• Group I (Properties held by the Group for owner-occupation in Hong Kong);

• Group II (Properties held by the Group for investment purpose in Hong Kong); and

• Group III (Property held by the Group for owner-occupation in the PRC).

3. VALUATION METHODOLOGIES

For the properties in Groups I and III, we have valued them by the direct comparison approach assuming sale of the properties in their existing states with the benefit of vacant possession and by making reference to comparable sales transactions as available in the relevant market.

For the properties in Group II, we have valued them by making reference to sales evidence as available in the market and where appropriate on the basis of capitalization of the net rental income shown on schedules handed to us. We have allowed for outgoings and in appropriate cases made provisions for reversionary income potential.

For the assessment of market rents, we have adopted the comparison approach by reference to comparable market rents in assessing the market rents of the properties. This approach rests on the wide acceptance of the market rents as the best indicator and pre-supposes that evidence of relevant rents in the market place can be extrapolated to similar properties, subject to allowances for variable factors.

Appropriate adjustments have been made to account for the differences between the properties and the comparables in terms of age, time, location, floor level and other relevant factors.

– 47 –

VALUATION REPORT

APPENDIX I

4. TITLE INVESTIGATION

For the properties in Hong Kong, we have carried out land searches at the Land Registry. However, we have not scrutinized all the original documents to verify ownership or to ascertain the existence of any lease amendments which may not appear on the copies handed to us.

For the property in the PRC, we have been provided with extracts of various documents and have been advised by the Group that no further relevant documents have been produced. However, we have not examined the original documents to verify the existing title to the property or any amendment, which may not appear on the copies handed to us. We do not accept a liability for any interpretation which we have placed on such information which is more properly the sphere of your legal adviser. In the course of our valuations, we have relied to a very considerable extent on the information given by the Group and its PRC legal adviser, Guang Dong Bestfound Law Firm（廣東 伯方律師事務所）, regarding the title to the property.

We have also relied on the advice given by the Group that the Group has valid and enforceable title to the property which is freely transferable, and has free and uninterrupted right to use the same, for the whole of the unexpired term granted subject to the payment of annual government rent/land use fees and all requisite land premium/purchase consideration payable have been fully settled.

5. VALUATION ASSUMPTIONS

Our valuations have been made on the assumption that the owners sell the properties in the market in their existing states without the benefit of deferred term contracts, leasebacks, joint ventures, management agreements or any similar arrangements which would serve to affect the values of such properties. In addition, no account has been taken of any option or right of preemption concerning or affecting the sale of the properties and no allowance has been made for the properties to be sold in one lot or to a single purchaser.

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APPENDIX I

6. SOURCE OF INFORMATION

In the course of our valuations, we have relied to a very considerable extent on the information provided by the Group, and have accepted advice given to us on such matters as planning approvals or statutory notices, easements, tenure, identification of properties, particulars of occupation, site/floor areas, ages of buildings and all other relevant matters which can affect the values of the properties. All documents have been used for reference only.

We have no reason to doubt the truth and accuracy of the information provided to us. We have also been advised that no material facts have been omitted from the information supplied. We consider that we have been provided with sufficient information to reach an informed view, and have no reason to suspect that any material information has been withheld.

7. VALUATION CONSIDERATION

We have inspected the exterior and, where possible, the interior of certain properties. No structural survey has been made in respect of the properties. However, in the course of our inspections, we did not note any serious defects. We are not, however, able to report that the properties are free from rot, infestation or any other structural defects. No tests were carried out on any of the building services.

We have not carried out on-site measurement to verify the site/floor areas of the properties under consideration but we have assumed that the site/floor areas shown on the documents handed to us are correct. Except as otherwise stated, all dimensions, measurements and areas included in the valuation certificates are based on information contained in the documents provided to us by the Group and are therefore approximations.

No allowance has been made in our valuations for any charges, mortgages or amounts owing on the properties nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the properties are free from encumbrances, restrictions and outgoings of an onerous nature which could affect their values.

Our valuations are prepared in compliance with the requirements set out in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, and in accordance with the HKIS Valuation Standards (2012 Edition) published by The Hong Kong Institute of Surveyors.

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APPENDIX I

8. REMARKS

Unless otherwise stated, all monetary amounts stated in our valuations are in Hong Kong Dollars (HK$).

Our Summary of Values and Valuation Certificates are attached.

Yours faithfully, For and on behalf of

Roma Appraisals Limited

Dr. Alan W K Lee

BCom(Property) MFin PhD(BA) MHKIS RPS(GP) AAPI CPV CPV(Business)

Associate Director

Note: Dr. Alan W K Lee is a Registered Professional Surveyor (General Practice), a member of Hong Kong Institute of Surveyors and an Associate of Australian Property Institute. He has over 10 years’ valuation experience in Hong Kong, Macau, the PRC, the Asia Pacific Region and European countries.

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APPENDIX I

SUMMARY OF VALUES

Group I – Properties held by the Group for owner-occupation in Hong Kong

No. Property 1. Unit 1 on 18th Floor, Wyler Centre Phase II, Nos.192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong 2. Carparking Space Nos.P1, P24, P25, P26 and P41 on 2nd Floor, Wyler Centre Phase II, Nos.192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong Total:	Market Value in Existing State as at 30 November 2013 HK$42,690,000. HK$3,750,000.
	HK$46,440,000.

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APPENDIX I

SUMMARY OF VALUES

Group II – Properties held by the Group for investment purpose in Hong Kong

No. Property

Market Value in Existing State as at 30 November 2013

1. Room B, Unit 2 on 18th Floor, Wyler Centre Phase II, HK$15,520,000. Nos.192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

2. No.61, 1st Street, Section M, Fairview Park, HK$8,560,000. Yuen Long, New Territories, Hong Kong

3. Factory K on 16th Floor of Block 3, HK$3,100,000. Golden Dragon Industrial Centre, Nos.172-180 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong Total: HK$27,180,000.

Group III – Property held by the Group for owner-occupation in the PRC

No. Property 6. No.1501, 15th Floor, Block 24, Jianwai SOHO, No.39 Dongsanhuan Zhonglu, Chaoyang District, Beijing, The PRC Total:	Market Value in Existing State as at 30 November 2013 RMB10,380,000.
	RMB10,380,000.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group I – Properties held by the Group for owner-occupation in Hong Kong

Description and Tenure

No. Property

1. Unit 1 on 18th Floor, The property comprises an industrial Wyler Centre Phase II, unit on 18th Floor of a 28-storey Nos.192-200 Tai Lin industrial building over a 2-storey Pai Road, lorry/car parking podium plus a Kwai Chung, New 2-level basement. The building was Territories, Hong Kong completed in 1989. Portion of As scaled from the registered floor 185/11,152nd equal plan, the saleable area of the property and undivided is approximately 13,983 sq.ft. (or shares of and in the about 1,299 sq.m.). Remaining Portion of Kwai Chung Town Kwai Chung Town Lot No.130 is Lot No.130 and the held under New Grant No. 4694 for a extension thereto. term of 99 years less the last 3 days commencing on 1 July 1898 and has been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

Market Value in Particulars of Existing State as at Occupancy 30 November 2013 The property is occupied HK$42,690,000. by the Group for warehouse and ancillary office.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. TW1333809 dated 28 January 2000.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses (Business)” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. As per the group’s instruction, we opined that the market rent as at the Date of Valuation is HK$224,000, exclusive of rates, Government Rent and management fee.

5. Our inspection was performed by Dr. Alan Lee in December 2013.

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APPENDIX I

1. Kwai Chung is the home of the principal commercial cargo handling area of Hong Kong, the Kwai Chung Container Terminal, one of the largest and busiest port facilities in the world.

Developments in the vicinity comprise a mixture of medium to high-rise industrial buildings, public housing and residential developments.

1. For private flatted factories in Hong Kong, the market information obtained from Rating and Valuation Department is as follows:–

Completions in 2012: 46,200 sq.m. Stock at the year end of 2012: 17,137,100 sq.m. Vacancy Rate at the year end of 2012: About 5.0% Yield as of October 2013: About 2.7% Average Rent in New Territories as of October 2013: HK$96 per sq.m. per month Average Price in New Territories as of October 2013: HK$37,896 per sq.m.

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APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

1. Carparking Space Nos. The property comprises 5 carparking P1, P24, P25, P26 and space on 2nd Floor of a 28-storey P41 on 2nd Floor, industrial building over a 2-storey Wyler Centre Phase II, lorry/car parking podium plus a Nos.192-200 Tai Lin 2-level basement. The building was Pai Road, completed in 1989. Kwai Chung, New Territories, Kwai Chung Town Lot No.130 is Hong Kong held under New Grant No. 4694 for a term of 99 years less the last 3 days

10/11,152nd equal and commencing on 1 July 1898 and has undivided shares of been extended upon expiry until 30 and in the Remaining June 2047 with a revised annual rent Portion of Kwai Chung at 3% of the rateable value for the Town Lot No.130 and time being of the lot. the extension thereto.

Market Value in Particulars of Existing State as at Occupancy 30 November 2013 The property is occupied HK$3,750,000. by the Group for carparking use.

Notes:

1. The registered owner of the property is Universe Property Investment Limited.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses (Business)” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. As per the group’s instruction, we opined that the total market rent as at the Date of Valuation is HK$20,000, exclusive of rates, Government Rent and management fee.

5. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group II – Properties held by the Group for investment purpose in Hong Kong

No. Property

Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. Room B, Unit 2 on The property comprises an industrial 18th Floor, unit on 18th Floor of a 28-storey Wyler Centre Phase II, industrial building over a 2-storey Nos.192-200 Tai Lin lorry/car parking podium plus a Pai Road, 2-level basement. The building was Kwai Chung, completed in 1989. New Territories, Hong Kong As scaled from the registered floor plan, the saleable area of the property Portion of is approximately 5,087 sq.ft. (or 185/11,152nd equal about 473 sq.m.). and undivided shares of and in the Kwai Chung Town Lot No.130 is Remaining Portion held under New Grant No. 4694 for a of Kwai Chung Town term of 99 years less the last 3 days Lot No.130 and the commencing on 1 July 1898 and has extension thereto. been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

The property is subject HK$15,520,000. to a tenancy for a term of 3 years commencing on 17 September 2013 and expiring on 16 September 2016 with a monthly rental of HK$91,000 inclusive of management fee, Government rent, Rates and airconditioning charges.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. TW1333809 dated 28 January 2000.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

1. Kwai Chung is the home of the principal commercial cargo handling area of Hong Kong, the Kwai Chung Container Terminal, one of the largest and busiest port facilities in the world.

Developments in the vicinity comprise a mixture of medium to high-rise industrial buildings, public housing and residential developments.

1. For private flatted factories in Hong Kong, the market information obtained from Rating and Valuation Department is as follows:–

Completions in 2012: 46,200 sq.m. Stock at the year end of 2012: 17,137,100 sq.m. Vacancy Rate at the year end of 2012: About 5.0% Yield as of October 2013: About 2.7% Average Rent in New Territories as of October 2013: HK$96 per sq.m. per month Average Price in New Territories as of October 2013: HK$37,896 per sq.m.

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APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. No.61, 1st Street, The property comprises a detached Section M, house situated in a large-scale lowFairview Park, rise residential development known as Yuen Long, Fairview Park which was completed New Territories, in 1977. Hong Kong The gross floor area of the property

Sub-section 84 of is about 1,297 sq.ft. (or about 120.5 Section M of Lot sq.m.). No.4665 in D.D. 104.

The property is subject HK$8,560,000. to a tenancy for a term of 2 years commencing on 28 April 2013 and expiring on 27 April 2015 with a monthly rental of HK$20,000 inclusive of management fee, Government rent and Rates.

The subject lot is held under New Grant No. 2265 for a term of 99 years less the last 3 days commencing on 1 July 1898 and has been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. 11051301670088 dated 28 April 2011.

2. The property lies within an area zoned as “Residential (Group C)” under Mai Po & Fairview Park Outline Zoning Plan No. S/YL-MP/6.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

4. The central part of Yuen Long was traditionally a market town in the area now known as Yuen Long San Hui, in Yuen Long District in the New Territories West in Hong Kong. The site of the market town was situated centrally with regard to surrounding villages.

Developments in the vicinity comprise a mixture of medium-rise industrial buildings, public housing, village houses and residential developments.

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VALUATION REPORT

APPENDIX I

1. For private domestic units in Hong Kong, the market information obtained from Rating and Valuation Department is as follows:–

Completions in 2012: 10,149 units Stock at the year end of 2012: 1,117,932 units Vacancy Rate at the year end of 2012: About 4.3% Yield as of October 2013 (for the same class of About 2.4% the property): Average Rent in New Territories as of October 2013 HK$242 per sq.m. per month (for the same class of the property): Average Price in New Territories as of October 2013 HK$82,690 per sq.m. (for the same class of the property):

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APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. Factory K on The property comprises an unit on the 16th Floor of Block 16th Floor of a 26-storey industrial 3, Golden Dragon building including 2-storey car park Industrial Centre, podium known as Golden Dragon Nos.172-180 Tai Lin Industrial Centre completed in 1978. Pai Road, Kwai Chung, As scaled from the registered floor New Territories, plan, the saleable floor area of the Hong Kong property is about 1,000 sq.ft. (or about 92.9 sq.m.). 10/6,038th equal and undivided shares of Kwai Chung Town Lot No. 130 is and in Section C of held under New Grant No. 4694 for a Kwai Chung Town term of 99 years less the last 3 days Lot No.130 and the commencing on 1 July 1898 and has extension thereto. been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

The property is subject to HK$3,100,000. a tenancy for a term of 2 years commencing on 1 May 2012 and expiring on 30 April 2014 with a monthly rental of HK$8,000 inclusive of management fee, Government Rent and rates.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. 10090901880163 dated 9 September 2010.

2. The property lies within an area zoned as “Other Specified Uses” under Kwai Chung Outline Zoning Plan No. S/KC/26.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

4. Kwai Chung is the home of the principal commercial cargo handling area of Hong Kong, the Kwai Chung Container Terminal, one of the largest and busiest port facilities in the world.

Developments in the vicinity comprise a mixture of medium to high-rise industrial buildings, public housing and residential developments.

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APPENDIX I

1. For private flatted factories in Hong Kong, the market information obtained from Rating and Valuation Department is as follows:–

Completions in 2012: 46,200 sq.m. Stock at the year end of 2012: 17,137,100 sq.m. Vacancy Rate at the year end of 2012: About 5.0% Yield as of October 2013: About 2.7% Average Rent in New Territories as of October 2013: HK$96 per sq.m. per month Average Price in New Territories as of October 2013: HK$37,896 per sq.m.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group III – Property held by the Group for owner-occupation in the PRC

No. Property Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. No.1501, 15th Floor, The property comprises an office Block 24, unit with a gross floor area of 281.44 Jianwai SOHO, sq.m. (or about 3,029 sq.ft.) in a large No.39 Dongsanhuan scale residential/office/commercial Zhonglu, composite development, known as Chaoyang District, Jianwai SOHO. The subject building Beijing, was completed in about 2006. The PRC

The property is occupied RMB10,380,000. by the Group for office use.

The land use rights of the property have been granted for a term expiring on 4 August 2052 for office use.

Notes:

1. Pursuant to a State-owned Land Use Rights Certificate, Jing Shi Chao Gang Ao Tai Guo Yong 2006 Chu Di No.6004383（京市朝港澳台國用2006出第6004383號）dated 10 October 2006, the property with an undivided land use rights area of 37.02 sq.m. is legally owned by Joy Talent Investment limited（俊宜投資有限公司）(“Joy Talent”) for a term expiring on 4 August 2052 for office use.

2. Pursuant to a Building Ownership Certificate, Jing Fang Quan Zheng Shi Chao Gang Ao Tai Zi Di No. 3610102, the property with a gross floor area of 281.44 sq.m. is owned by Joy Talent for office use.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

4. A summary of major certificates/approvals is shown as follows:

State–owned Land Use Rights Certiticate Yes Building Ownership Certificate Yes

1. We have been provided with a legal opinion on the property prepared by the Group’s legal advisor, which contains, inter alia, the following information:

2. a. Joy Talent has legally obtained the property and is entitled to occupy, use, lease, mortgage, transfer or dispose of the property in the market; and

3. b. The property is free from any mortgages and third party encumbrances.

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APPENDIX I

• 6 As advised by the Group, Joy Talent is an indirect wholly-owned subsidiary of the Company.

• Chaoyang District is home to the majority of Beijing’s many foreign embassies, the well-known Sanlitun bar street, as well as Beijing’s growing CBD. Chaoyang District extends west to Chaoyangmen on the eastern 2nd Ring Road, and nearly as far east as the Ximazhuang toll station on the Jingtong Expressway. Within the urban area of Beijing, it occupies 475 square kilometres, making it the largest district. As of 2005, Chaoyang District had a total population of 3,642,000, making it the most populous in Beijing. The district has jurisdiction over 22 sub-district offices and 20 area offices. Chaoyang District is also home to Silk Street, and many other market areas, shopping malls, and restaurant strips.

Developments in the vicinity comprise a mixture of medium to high-rise commercial buildings and residential developments.

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VALUATION REPORT

APPENDIX I

According to Listing Rule 5.09, the following is the valuation report within three months before the issue of the Circular.

==> picture [96 x 55] intentionally omitted <==

Unit 3806, 38/F, China Resources Building, 26 Harbour Road, Wan Chai, Hong Kong Tel (852) 2529 6878 Fax (852) 2529 6806 E-mail info@romagroup.com http://www.romagroup.com

10 December 2013

Universe International Holdings Limited 18th Floor, Wyler Centre Phase II Nos.192 – 200 Tai Lin Pai Road Kwai Chung New Territories Hong Kong

Dear Sir/Madam,

Re: Various Properties in Hong Kong and the People’s Republic of China

In accordance with your instructions for us to value the properties held by Universe International Holdings Limited (the “Company”) and/or its subsidiaries (together with the Company referred to as the “Group”) in Hong Kong and the People’s Republic of China (the “PRC”), we confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market values of the properties as at 30 November 2013 (the “Date of Valuation”) for your internal reference only.

1. BASIS OF VALUATION

Our valuations of the properties are our opinion of the market values of the concerned properties which we would define as intended to mean “the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion”.

Market value is understood as the value of an asset or liability estimated without regard to costs of sale or purchase (or transaction) and without offset for any associated taxes or potential taxes.

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APPENDIX I

For the assessment of market rents, we would define as intended to mean “the estimated amount for which a property would be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm’s-length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion”.

2. PROPERTY CATEGORIZATION

In the course of our valuations, the properties owned by the Group are categorized into the following groups:

• Group I (Properties held by the Group for owner-occupation in Hong Kong);

• Group II (Properties held by the Group for investment purpose in Hong Kong); and

• Group III (Property held by the Group for owner-occupation in the PRC).

3. VALUATION METHODOLOGIES

For the properties in Groups I and III, we have valued them by the direct comparison approach assuming sale of the properties in their existing states with the benefit of vacant possession and by making reference to comparable sales transactions as available in the relevant market.

For the properties in Group II, we have valued them by making reference to sales evidence as available in the market and where appropriate on the basis of capitalization of the net rental income shown on schedules handed to us. We have allowed for outgoings and in appropriate cases made provisions for reversionary income potential.

For the assessment of market rents, we have adopted the comparison approach by reference to comparable market rents in assessing the market rents of the properties. This approach rests on the wide acceptance of the market rents as the best indicator and pre-supposes that evidence of relevant rents in the market place can be extrapolated to similar properties, subject to allowances for variable factors.

Appropriate adjustments have been made to account for the differences between the properties and the comparables in terms of age, time, location, floor level and other relevant factors.

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APPENDIX I

4. TITLE INVESTIGATION

For the properties in Hong Kong, we have carried out land searches at the Land Registry. However, we have not scrutinized all the original documents to verify ownership or to ascertain the existence of any lease amendments which may not appear on the copies handed to us.

For the property in the PRC, we have been shown copies of extracts of various title documents and have been advised by the Group that no further relevant documents have been produced. Furthermore, due to the nature of the land registration system in the PRC, we have not been able to examine the original documents to verify ownership or to ascertain the existence of any amendment documents, which may not appear on the copies handed to us. Therefore, in the course of our valuation, we have relied on the advice and information given by the Group regarding the title of the property in the PRC. All documents have been used for reference only.

We have also relied on the advice given by the Group that the Group has valid and enforceable title to the property which is freely transferable, and has free and uninterrupted right to use the same, for the whole of the unexpired term granted subject to the payment of annual government rent/land use fees and all requisite land premium/purchase consideration payable have been fully settled.

5. VALUATION ASSUMPTIONS

Our valuations have been made on the assumption that the owners sell the properties in the market in their existing states without the benefit of deferred term contracts, leasebacks, joint ventures, management agreements or any similar arrangements which would serve to affect the values of such properties. In addition, no account has been taken of any option or right of preemption concerning or affecting the sale of the properties and no allowance has been made for the properties to be sold in one lot or to a single purchaser.

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APPENDIX I

6. SOURCE OF INFORMATION

In the course of our valuations, we have relied to a very considerable extent on the information provided by the Group and have accepted advice given to us on such matters as planning approvals or statutory notices, easements, tenure, identification of properties, particulars of occupation, floor areas, ages of buildings and all other relevant matters which can affect the values of the properties. All documents have been used for reference only.

We have no reason to doubt the truth and accuracy of the information provided to us. We have also been advised that no material facts have been omitted from the information supplied. We consider that we have been provided with sufficient information to reach an informed view, and have no reason to suspect that any material information has been withheld.

7. VALUATION CONSIDERATION

We have inspected the exterior and, where possible, the interior of certain properties. No structural survey has been made in respect of the properties. However, in the course of our inspections, we did not note any serious defects. We are not, however, able to report that the properties are free from rot, infestation or any other structural defects. No tests were carried out on any of the building services.

We have not carried out on-site measurement to verify the floor areas of the properties under consideration but we have assumed that the floor areas shown on the documents handed to us are correct. Except as otherwise stated, all dimensions, measurements and areas included in the valuation certificates are based on information contained in the documents provided to us by the Group and are therefore approximations.

No allowance has been made in our valuations for any charges, mortgages or amounts owing on the properties nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the properties are free from encumbrances, restrictions and outgoings of an onerous nature which could affect their values.

Our valuations are prepared in compliance with the requirements set out in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, and in accordance with the HKIS Valuation Standards (2012 Edition) published by The Hong Kong Institute of Surveyors.

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APPENDIX I

8. REMARKS

Unless otherwise stated, all monetary amounts stated in our valuations are in Hong Kong Dollars (HK$). Where appropriate, the exchange rates that we have adopted are HK$1 to RMB0.78607.

Our Summary of Values and Valuation Certificates are attached.

Yours faithfully, For and on behalf of

Roma Appraisals Limited

Dr. Alan W K Lee

BCom(Property) MFin PhD(BA) MHKIS RPS(GP) AAPI CPV CPV(Business)

Associate Director

Note: Dr. Alan W K Lee is a Registered Professional Surveyor (General Practice), a member of Hong Kong Institute of Surveyors and an Associate of Australian Property Institute. He has over 9 years’ valuation experience in Hong Kong, Macau, the PRC, the Asia Pacific Region and European countries.

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VALUATION REPORT

APPENDIX I

SUMMARY OF VALUES

Group I – Properties held by the Group for owner-occupation in Hong Kong

No. Property 1. Unit 1 on 18th Floor, Wyler Centre Phase II, Nos.192 – 200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong 2. Carparking Space Nos.P1, P24, P25, P26 and P41 on 2nd Floor, Wyler Centre Phase II, Nos.192 – 200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong Total:	Market Value in Existing State as at 30 November 2013 HK$42,690,000. HK$3,750,000.
	HK$46,440,000.

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VALUATION REPORT

APPENDIX I

SUMMARY OF VALUES

Group II – Properties held by the Group for investment purpose in Hong Kong

No. Property

Market Value in Existing State as at 30 November 2013

1. Room B, Unit 2 on 18th Floor, Wyler Centre Phase II, HK$15,520,000. Nos.192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

2. No.61, 1st Street, Section M, Fairview Park, HK$8,560,000. Yuen Long, New Territories, Hong Kong

3. Factory K on 16th Floor of Block 3, HK$3,100,000. Golden Dragon Industrial Centre, Nos.172-180 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong Total: HK$27,180,000.

Group III – Property held by the Group for owner-occupation in the PRC

No. Property 6. No.1501, 15th Floor, Block 24, Jianwai SOHO, No.39 Dongsanhuan Zhonglu, Chaoyang District, Beijing, The PRC Total:	Market Value in Existing State as at 30 November 2013 RMB10,380,000.
	RMB10,380,000.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group I – Properties held by the Group for owner-occupation in Hong Kong

Market Value in Particulars of Existing State as at No. Property Description and Tenure Occupancy 30 November 2013 1. Unit 1 on 18th Floor, The property comprises an industrial The property is occupied HK$42,690,000. Wyler Centre Phase II, unit on 18th Floor of a 28-storey by the Group for Nos.192 – 200 industrial building over a 2-storey warehouse, ancillary Tai Lin Pai Road, lorry/car parking podium plus a office. Kwai Chung, 2-level basement. The building was New Territories, completed in 1989. Hong Kong As scaled from the registered floor Portion of plan, the saleable area of the property 185/11,152nd equal is approximately 13,983 sq.ft. (or and undivided about 1,299 sq.m.). shares of and in the Remaining Portion Kwai Chung Town Lot No.130 is of Kwai Chung Town held under New Grant No. 4694 for a Lot No.130 and the term of 99 years less the last 3 days extension thereto. commencing on 1 July 1898 and has been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. TW1333809 dated 28 January 2000.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses (Business)” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. As per the group’s instruction, we opined that the market rent as at the Date of Valuation is HK$224,000, exclusive of rates, Government Rent and management fee.

5. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

1. Carparking Space Nos. The property comprises 5 carparking P1, P24, P25, P26 and space on 2nd Floor of a 28-storey P41 on 2nd Floor, industrial building over a 2-storey Wyler Centre Phase II, lorry/car parking podium plus a Nos.192 – 200 2-level basement. The building was Tai Lin Pai Road, completed in 1989. Kwai Chung, New Territories, Kwai Chung Town Lot No.130 is Hong Kong held under New Grant No. 4694 for a term of 99 years less the last 3 days

10/11,152nd equal and commencing on 1 July 1898 and has undivided shares of been extended upon expiry until 30 and in the Remaining June 2047 with a revised annual rent Portion of Kwai Chung at 3% of the rateable value for the Town Lot No.130 and time being of the lot. the extension thereto.

Market Value in Particulars of Existing State as at Occupancy 30 November 2013 The property is occupied HK$3,750,000. by the Group for carparking use.

Notes:

1. The registered owner of the property is Universe Property Investment Limited.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses (Business)” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. As per the group’s instruction, we opined that the total market rent as at the Date of Valuation is HK$20,000, exclusive of rates, Government Rent and management fee.

5. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group II – Properties held by the Group for investment purpose in Hong Kong

No. Property

Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. Room B, Unit 2 The property comprises an industrial on 18th Floor, unit on 18th Floor of a 28-storey Wyler Centre Phase II, industrial building over a 2-storey Nos.192 – 200 lorry/car parking podium plus a Tai Lin Pai Road, 2-level basement. The building was Kwai Chung, completed in 1989. New Territories, Hong Kong As scaled from the registered floor plan, the saleable area of the property

Portion of is approximately 5,087 sq.ft. (or 185/11,152nd equal about 473 sq.m.). and undivided shares of and in the Kwai Chung Town Lot No.130 is Remaining Portion held under New Grant No. 4694 for a of Kwai Chung Town term of 99 years less the last 3 days Lot No.130 and the commencing on 1 July 1898 and has extension thereto. been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

The property is subject HK$15,520,000. to a tenancy for a term of 3 years commencing on 17 September 2013 and expiring on 16 September 2016 with a monthly rental of HK$91,000 inclusive of management fee, Government rent, Rates and airconditioning charges.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. TW1333809 dated 28 January 2000.

2. The property is subject to Management Agreement in favour of JLW Management Services Limited “The Manager” vide Memorial No. TW592624 dated 2 June 1989.

3. The property lies within an area zoned as “Other Specified Uses” under Kwai Chung Outline Zoning Plan No. S/KC/26.

4. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. No.61, 1st Street, The property comprises a detached Section M, house situated in a large-scale lowFairview Park, rise residential development known as Yuen Long, Fairview Park which was completed New Territories, in 1977. Hong Kong The gross floor area of the property

Sub-section 84 of is about 1,297 sq.ft. (or about 120.5 Section M of Lot sq.m.). No.4665 in D.D. 104.

The property is subject HK$8,560,000. to a tenancy for a term of 2 years commencing on 28 April 2013 and expiring on 27 April 2015 with a monthly rental of HK$20,000 inclusive of management fee, Government rent and Rates.

The subject lot is held under New Grant No. 2265 for a term of 99 years less the last 3 days commencing on 1 July 1898 and has been extended upon expiry until 30 June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. 11051301670088 dated 28 April 2011.

2. The property lies within an area zoned as “Residential (Group C)” under Mai Po & Fairview Park Outline Zoning Plan No. S/YL-MP/6.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

No. Property Description and Tenure

Market Value in Particulars of Existing State as at Occupancy 30 November 2013

1. Factory K on The property comprises an unit on the 16th Floor of 16th Floor of a 26-storey industrial Block 3, building including 2-storey car park Golden Dragon podium known as Golden Dragon Industrial Centre, Industrial Centre completed in 1978. Nos.172-180 Tai Lin Pai Road, As scaled from the registered floor Kwai Chung, plan, the saleable floor area of the New Territories, property is about 1,000 sq.ft. (or Hong Kong about 92.9 sq.m.). 10/6,038th equal and Kwai Chung Town Lot No. 130 is undivided shares of held under New Grant No. 4694 for a and in Section C of term of 99 years less the last 3 days Kwai Chung Town commencing on 1 July 1898 and has Lot No.130 and the been extended upon expiry until 30 extension thereto. June 2047 with a revised annual rent at 3% of the rateable value for the time being of the lot.

The property is subject to HK$3,100,000. a tenancy for a term of 2 years commencing on 1 May 2012 and expiring on 30 April 2014 with a monthly rental of HK$8,000 inclusive of management fee, Government Rent and rates.

Notes:

1. The registered owner of the property is Universe Property Investment Limited vide Memorial No. 10090901880163 dated 9 September 2010.

2. The property lies within an area zoned as “Other Specified Uses” under Kwai Chung Outline Zoning Plan No. S/KC/26.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

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VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Group III – Property held by the Group for owner-occupation in the PRC

• No. Property Description and Tenure 6. No.1501, 15th Floor, The property comprises an office Block 24, unit with a gross floor area of 281.44 Jianwai SOHO, sq.m. (or about 3,029 sq.ft.) in a large No.39 Dongsanhuan scale residential/office/commercial Zhonglu, composite development, known as Chaoyang District, Jianwai SOHO, completed in about Beijing, 2006. The PRC The land use rights of the property have been granted for a term expiring on 4 August 2052 for office use.

Market Value in Particulars of Existing State as at Occupancy 30 November 2013 The property is occupied RMB10,380,000. by the Group for office use.

Notes:–

1. Pursuant to a State-owned Land Use Rights Certificate, Jing Shi Chao Gang Ao Tai Guo Yong 2006 Chu Di No.6004383（京市朝港澳台國用2006出第6004383號）dated 10 October 2006, the property with an undivided land use rights area of 37.02 sq.m. is legally owned by Joy Talent Investment limited（俊宜投資有限公司）(“Joy Talent”) for a term expiring on 4 August 2052 for office use.

2. Pursuant to a Building Ownership Certificate, Jing Fang Quan Zheng Shi Chao Gang Ao Tai Zi Di No. 3610102, the property with a gross floor area of 281.44 sq.m. is owned by Joy Talent for office use.

3. Our inspection was performed by Dr. Alan Lee in December 2013.

4. We have been instructed by the Group to perform our valuation based on the following assumptions:

5. a. Joy Talent is in possession of a proper legal title to the property and is entitled to let the property with its residual term of land use rights at no extra land premium or other onerous payment payable to the government;

6. b. All land premium and other costs of ancillary utility services have been settled in full;

7. c. The property is not subject to mortgage or any other material encumbrances;

8. d. The existing use of the property is in compliance with the local planning regulations and has been approved by the relevant government authorities; and

9. e. Whether as a whole or on strata basis, the property can be freely transferred to local or overseas purchasers.

10. As advised by the Group, Joy Talent is an indirect wholly-owned subsidiary of the Company.

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GENERAL INFORMATION

APPENDIX II

1. RESPONSIBILITY STATEMENT

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

2. DISCLOSURE OF INTERESTS

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the Shares, underlying shares (within the meaning of Part XV of the SFO) or debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required to be: (a) notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); (b) entered in the register kept by the Company pursuant to Section 352 of the SFO; or (c) notified to the Company and the Stock Exchange pursuant to the Model Code were as follows:

(a) Interests in Shares – Long positions

					Number
					of underlying		Approximate
	Number of Ordinary		Shares		shares held		percentage of
Name of Director/	Personal	Family	Corporate	Other	under equity		issued share
Chief Operating Officer	interests	interests	interests	interests	derivatives	Total	capital
Mr. Lam Shiu Ming, Daneil	–	–	–	359,131,705	17,117.703	376,249,408	21.93%
				(note i)	(note ii)
Mr. Yeung Kim Piu	–	–	–	–	4,279,425	4,279,425	0.25%
					(note ii)
Mr. Lam Siu Keung, Alvin	–	–	–	–	8,558,850	8,558,850	0.50%
					(note ii)

Notes:

• (i) These Shares were owned by Globalcrest, the entire issued share capital of which is held by Central Core Resources Limited. Central Core Resources Limited is the trustee of a discretionary trust under which certain immediate family members of Mr. Lam Shiu Ming, Daneil are discretionary objects.

• (ii) These interests represent the interests in underlying shares in respect of share options granted by the Company to Mr. Lam and Mr. Yeung who are Directors as beneficial owners; and Mr. Lam Siu Keung, Alvin as Chief Operating Officer as beneficial owner, the details of which are set out in 2(b) below.

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GENERAL INFORMATION

APPENDIX II

• (b) Interests in underlying shares of the Company – long positions (share options to subscribe for Shares)

				Number
				of options
				outstanding
		Period during	Price per	as at the
		which share	Share on	Latest
	Date of	options are	exercise of	Practicable
Grantee	grant	exercisable	options	Date
Mr. Lam Shiu Ming,	27 June 2012	27 June 2012 –	HK$0.067	17,117.703
Daneil		26 June 2015
Mr. Yeung Kim Piu	27 June 2012	27 June 2012 –	HK$0.067	4,279,425
		26 June 2015
Mr. Lam Siu Keung,	27 June 2012	27 June 2012 –	HK$0.067	8,558,850
Alvin		26 June 2015

Save as disclosed herein, as at the Latest Practicable Date, none of the Director or chief executive of the Company had any interest or short position in the shares, underlying shares (within the meaning of Part XV of the SFO) or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be: (a) notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); (b) entered in the register kept by the Company pursuant to Section 352 of the SFO; or (c) notified to the Company and the Stock Exchange pursuant to the Model Code.

(d) Other interests

(i) Interests in service contracts

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group (excluding contracts expiring or terminable by any member of the Group within one year without payment of compensation, other than statutory compensation).

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GENERAL INFORMATION

APPENDIX II

(ii) Interests in assets of the Group

Except for the S&P Agreements, none of the Directors has, or has had, any direct or indirect interest in any assets which have been, since 30 June 2013, being the date to which the latest audited accounts of the Group were made up, acquired or disposed of by or leased to any member of the Group or are proposed to be acquired or disposed of by or leased to, any member of the Group.

(iii) Interests in contracts or arrangements

Except for the S&P Agreements, none of the Directors is materially interested in any contract or arrangement subsisting at the date of this circular which is significant in relation to the business of the Group taken as a whole.

3. 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 (not being Directors or chief executive of the Company) had an interest or short position in the Shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, 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 in any options in respect of such capital:

Long positions in Shares

	Number of	Percentage
Name	Shares held	of shareholding
Central Core Resources Limited (note i)	359,131,705	20.93%
Globalcrest (note i)	359,131,705	20.93%
貴州豐瑞投資有限公司(note ii)	135,200,000	7.88%
沈鑫(note ii)	135,200,000	7.88%

Notes:

(i) These Shares were owned by Globalcrest, the entire issued share capital of which is held by Central Core Resources Limited. Central Core Resources Limited is the trustee of a discretionary trust under which certain immediate family members of Mr. Lam Shiu Ming, Daneil are discretionary objects.

• (ii) 沈鑫 owned 99% equity interests of 貴州豐瑞投資有限公司, therefore 沈鑫 is deemed to have interests in such Shares.

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GENERAL INFORMATION

APPENDIX II

Save as disclosed above, the Directors or chief executive of the Company are not aware of any other persons (not being Directors or chief executive of the Company) as at the Latest Practicable Date, who had an interest or short position in the Shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or who was 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 in any options in respect of such capital.

4. NO MATERIAL ADVERSE CHANGE

The Directors are not aware of any material adverse change in the financial or trading position or outlook of the Group since 30 June 2013 (being the date to which the latest published audited accounts of the Group were made up).

5. COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors and their respective associates had any interest in a business which competes or may compete with the business of the Group.

6. QUALIFICATIONS OF EXPERTS, CONSENTS AND THEIR INTERESTS IN ASSETS

The following are the qualifications of the experts who have given opinions or advice which are contained in this circular:

Name	Qualification
Pan Asia	A licensed corporation to carry on business in types 1 and 6 regulated
	activities (dealing in securities and advising on corporate finance) under
	the SFO
RAL	An independent professional surveyor and property valuer

Pan Asia and RAL have given and have not withdrawn their written consents to the issue of this circular with the inclusion herein of their respective letters to their names in the form and context in which they appear.

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APPENDIX II

GENERAL INFORMATION

As at the Latest Practicable Date, none of Pan Asia and RAL was beneficially interested in the share capital of any member of the Group, nor did they have any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group, nor did they have any direct interest in any assets which were, since 30 June 2013 (being the date which the latest published audited consolidated financial statements of the Group were made up) acquired or disposed of by or leased to, or proposed to be acquired or disposed of by or leased to, any member of the Group.

7. MISCELLANEOUS

• (a) The secretary of the Company is Mr. Lam Kit Sun, who is a fellow and practicing member of the Hong Kong Institute of Certified Public Accountants, a fellow of the Association of Chartered Certified Accountants and an associate of the Hong Kong Institute of Chartered Secretaries.

• (b) The branch share registrar and transfer office of the Company in Hong Kong is Tricor Abacus Limited at Level 54, Hopewell Centre 183 Queen’s Road East Hong Kong.

• (c) The English text of this circular shall prevail over the Chinese text for the purpose of interpretation.

8. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the Company’s head office at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong during 9:30 a.m. to 5:00 p.m. on any day (not being a Saturday, Sunday or public holiday) on which licensed banks in Hong Kong are open for general banking business from the date of this circular up to and including 19 February 2014:

• (a) the S&P Agreements;

• (b) the letter from the Independent Board Committee to the Independent Shareholders, the text of which is set out on page 32 of this circular;

• (c) the letter from Pan Asia to the Independent Board Committee and the Independent Shareholders, the text of which is set out on pages 33 and 45 of this circular; and

• (d) the valuation reports issued by RAL, the text of which is set out in Appendix I to this circular.

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NOTICE OF SPECIAL GENERAL MEETING

UNIVERSE INTERNATIONAL HOLDINGS LIMITED 寰宇國際控股有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1046)

NOTICE IS HEREBY GIVEN that a special general meeting of Universe International Holdings Limited (the “Company”) will be held at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong on Wednesday, 19 February 2014, at 2:30 p.m. or in the event that a black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day, at the same time and place on the second Business Day (as defined in Note (1) below) after 19 February 2014 (or any adjournment thereof) (the “SGM”) for the purpose of considering and, if thought fit, passing the following resolutions as ordinary resolutions of the Company:

ORDINARY RESOLUTIONS

1. “ THAT :

2. (a) the conditional agreement dated 10 December 2013 entered into between the Universe Films (Holdings) Limited (“UFH”) and Mr. Lam Shiu Ming, Daneil (“Mr. Lam”) in relation to the sale and purchase of the entire issued share capital in Joy Talent Investment Limited（俊宜投資有限公司）(the “JT Agreement”) and a copy of the JT Agreement marked “A” is tabled before the meeting and signed for identification purpose by the Chairman of the meeting, as more particularly described in the circular to the shareholders of the Company dated 29 January 2014 (the “Circular”) of which this notice forms part, be approved, ratified and confirmed; and

• for identification purpose only

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NOTICE OF SPECIAL GENERAL MEETING

• (b) the directors of the Company (“Directors”) be and are hereby authorized to exercise all the powers of the Company and take all steps as might in their absolute discretion consider necessary, desirable or expedient to give effect to or in connection with the JT Agreement including, without limitation to:

  • (i) the execution, amendment, supplement, delivery, submission and implementation of any further documents or agreements with Mr. Lam or any other parties in connection with or incidental to the JT Agreement; and

  • (ii) the taking of all necessary actions to implement the transactions contemplated under the JT Agreement.”

• “ THAT

• (a) the conditional agreement dated 10 December 2013 entered into between the UFH, Universe Laser & Video Co., Limited（寰宇鐳射錄影有限公司）and Mr. Lam in relation to the sale and purchase of the entire issued share capital in Universe Property Investment Limited（寰宇物業投資有限公司）(the “UPI Agreement”) and a copy of the UPI Agreement marked “B” is tabled before the meeting and signed for identification purpose by the Chairman of the meeting, as more particularly described in the Circular of which this notice forms part, be approved, ratified and confirmed; and

• (b) the Directors be and are hereby authorized to exercise all the powers of the Company and take all steps as might in their absolute discretion consider necessary, desirable or expedient to give effect to or in connection with the UPI Agreement including, without limitation to:

  • (i) the execution, amendment, supplement, delivery, submission and implementation of any further documents or agreements with Mr. Lam or any other parties in connection with or incidental to the UPI Agreement; and

  • (ii) the taking of all necessary actions to implement the transactions contemplated under the UPI Agreement.”

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NOTICE OF SPECIAL GENERAL MEETING

1. “ THAT Mr. Choi Wing Koon be re-elected as an independent non-executive Director and the board of Directors be authorized to fix his remuneration.”

2. “ THAT Mr. Lam Chi Keung be re-elected as an independent non-executive Director and the board of Directors be authorized to fix his remuneration.”

By Order of the Board Lam Shiu Ming, Daneil Chairman

Hong Kong, 29 January 2014

Notes:

• (1) Business Day means any day (excluding Saturday) on which no black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on that day and on which licensed banks in Hong Kong are open for general banking business. If a black rainstorm warning or a tropical cyclone warning signal number 8 or above is hoisted or remains hoisted in Hong Kong at 12 noon on 19 February 2014, the SGM will not be held on that day but will be held at the same time and place on the second Business Day after 19 February 2014 (or any adjournment thereof).

• (2) A member entitled to attend and vote at the SGM is entitled to appoint another person as his proxy to attend and, on a poll, vote instead of him/her. A member who is the holder of two or more Shares may appoint more than one proxy to attend and vote on his/her behalf. A proxy need not be a member of the Company.

• (3) In order to be valid, the proxy form completed in accordance with the instructions set out therein, together with the power of attorney or other authority, if any, under which it is signed, or a certified copy of such power of attorney, must be deposited at the principal place of business of the Company in Hong Kong situated at 18th Floor, Wyler Centre Phase II, 192-200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong not less than 48 hours before the time appointed for the SGM or any adjourned meeting thereof.

• (4) In the case of joint holders of any Share, any one of such joint holders may vote at the SGM, either in person or by proxy, in respect of such Share as if he/she were solely entitled thereto, but if more than one of such joint holders be present at the meeting the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint registered holders and for this purpose seniority shall be determined by the order in which the names stand in the register of members in respect of the joint holding.

• (5) Completion and return of the proxy form will not preclude you from attending and voting in person at the SGM should you so wish and in such event the proxy form shall be deemed to be revoked.

• (6) As at the date hereof, the Board comprises Mr. Lam Shiu Ming, Daneil, Mr. Yeung Kim Piu and Mr. Lam Kit Sun as executive Directors and Mr. Lam Wing Tai, Mr. Choi Wing Koon and Mr. Lam Chi Keung as independent nonexecutive Directors.

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