PAK TAK INTERNATIONAL LIMITED *

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. THE TRANSACTION PAK TAK INTERNATIONAL LIMITED * (incorporated in Bermuda with limited liability) (Stock Code: 2668) DISCLOSEABLE TRANSACTION IN RELATION TO ACQUISITION OF PROPERTY On 5 March 2018, the Purchaser, a direct wholly-owned subsidiary of the Company, entered into the Provisional SPA with the Vendor and the Agent, pursuant to which the Purchaser conditionally agreed to purchase the Sale Share and take up the assignment of the Shareholder s Loan, and the Vendor conditionally agreed to sell the Sale Share and assign the Shareholder s Loan, at the consideration of HK$71,632,000 (subject to adjustments). The Target Company, which is principally engaged in property investment in Hong Kong, is the sole legal and beneficial owner of the Property. IMPLICATIONS UNDER THE LISTING RULES As one or more of the applicable percentage ratios (as defined in Rule of the Listing Rules) in respect the Transaction under the Provisional SPA are more than 5% but less than 25%, the Transaction constitutes a discloseable transaction for the Company and is subject to the requirements of notification and announcement, but is exempted from the circular and Shareholders approval requirements under Chapter 14 of the Listing Rules. INTRODUCTION On 5 March 2018, the Purchaser, a direct wholly-owned subsidiary of the Company, entered into the Provisional SPA with the Vendor and the Agent, pursuant to which the Purchaser conditionally agreed to purchase the Sale Share and take up the assignment of the Shareholder s Loan, and the Vendor conditionally agreed to sell the Sale Share and assign the Shareholder s Loan, at the consideration of HK$71,632,000 (subject to adjustments). * for identification purpose only 1

2 THE PROVISIONAL SPA Major terms of the Provisional SPA are set out below: Date: 5 March 2018 Parties: Vendor Purchaser Agent An individual Golden Flourish Property Limited PropWiser Consultants Limited To the best of the Directors knowledge, information and belief having made all reasonable enquiries, the Vendor, the Agent and their respective ultimate beneficial owner(s) are third parties independent of the Company and its connected persons (as defined in the Listing Rules). Terms of the Provisional SPA Pursuant to the Provisional SPA, the Purchaser conditionally agreed to purchase the Sale Share and take up the assignment of the Shareholder s Loan, and the Vendor conditionally agreed to sell the Sale Share and assign the Shareholder s Loan. The Sale Share represents the entire issued share capital of the Target Company, which is beneficially owned as to 100% by the Vendor. The Target Company, which is principally engaged in property investment in Hong Kong, is the sole legal and beneficial owner of the Property. Pursuant to the terms of the Provisional SPA, the Vendor and the Purchaser have agreed to enter into a formal agreement of sale and purchase on or before 23 April The Property The Property is at Unit 1902, 19/F, Tower 2 Lippo Centre, No. 89 Queensway, Hong Kong. The Property is a commercial property with a gross floor area of approximately 1,900 square feet and is currently leased out for a term expiring on 14 June It is intended to be used as the office premises of the Group. 2

3 Consideration The Consideration for the Transaction is HK$71,632,000, which shall be payable by the Purchaser by the way of cash to the Vendor in the following manners: (a) (b) (c) an initial deposit of HK$3,581,600 has been paid upon signing of the Provisional SPA; a further deposit of HK$3,581,600 shall be payable on or before 23 April 2018; and the balance of HK$64,468,800 (subject to the adjustments) shall be payable on Completion in the manner stipulated in the Provisional SPA and the formal agreement of sale and purchase. The Consideration was determined after arm s length negotiations between the Purchaser and the Vendor on normal commercial terms with reference to the prevailing market prices of properties of similar nature available in Admiralty and the nearby area. The Consideration will be financed as to (i) HK$60,000,000 from the Placing and the Subscription (as defined in the Placing and Subscription Announcement); (ii) the balance of HK$11,632,000 by way of internal resources of the Group and/or borrowings from a bank. The Board confirms that the financing arrangement of the Transaction is consistent with the use of proceeds as stated in the Placing and Subscription Announcement. Adjustments to the Consideration The balance of the Consideration of HK$64,468,800 (being the Consideration less the initial deposit and the further deposit) shall be adjusted upwards or downwards (as the case may be) accordingly in the manner as follows: (a) it shall be added to all tangible assets of the Target Company including rent receivable, utilities and other miscellaneous deposits, prepaid rates and government rent, and other expenses relating to the Property as shown in the Proforma Completion Accounts; and (b) it shall be deducted all current liabilities of the Target Company as shown in the Proforma Completion Accounts (other than the Shareholder s Loan). The Vendor undertakes to deliver the Audited Completion Accounts to the Purchaser or the Purchaser s solicitor within 30 days from the Completion Date. If the NTAV as shown in the Audited Completion Accounts is different from the NTAV as shown in the Proforma Completion Accounts, the Purchase or the Vendor (as the case may be) shall pay the difference to the other party within five days from the date of receipt of the Audited Completion Accounts. 3

4 Conditions precedents Completion is conditional upon the following conditions precedent being fulfilled: (i) (ii) the Purchaser having completed its due diligence review on the business, financial, legal and other aspects of the Target Company and being satisfied with the results thereof; the Vendor having procured the Target Company to give and prove a good title to the Property; and (iii) all the representations, undertakings and warranties given by the Vendor under this Provisional SPA and the formal agreement of sale and purchase are and shall remain true, accurate, correct and complete and not misleading in all respects up to the Completion. Completion Completion is expected to take place on 16 May 2018 or such other date as the Purchaser and the Vendor may agree in writing after the conditions have been fulfilled. Upon Completion, the Target Company will become a direct wholly-owned subsidiary of the Purchaser and an indirect wholly-owned subsidiary of the Company. INFORMATION ABOUT THE PARTIES The Group is principally engaged in manufacturing of and trading in garments, money lending, leasing business, general trading and property and securities investment. The Purchaser is a direct wholly-owned subsidiary of the Company and its principal activity is investment holding. The Target Company is a company incorporated in British Virgin Islands with limited liability and is principally engaged in property investment in Hong Kong and is the sole legal and beneficial owner of the Property. 4

5 Financial information of the Target Company Set out below is certain financial information of the Target Company for the two years ended 31 March 2017 based on its management account and audited financial statements: For the year ended 31 March HK$ 000 HK$ 000 (audited) (audited) Revenue 1,329 1,656 Loss before and after taxation As at 28 February 2018, the unaudited net liabilities of the Target Company was HK$2.9 million. The amount due by Target Company to the Vendor amounted to HK$36.3 million and the outstanding balance of the mortgage loan in respect of the Property amounted to approximately HK$6.6 million. It is one of the conditions that the Vendor shall procure repayment of the mortgage loan in respect of the Property on or before the Completion Date. REASONS FOR THE TRANSACTION The Group currently leases an office in Hong Kong. The lease was entered into by the Group in April 2017 and expiring in April As disclosed in the circular of the Company dated 13 November 2017, the Group plans to acquire offices located in Admiralty. While the purchase price of private offices is also on the increasing trend, the Board believes that acquisition of property for the Company s office could provide a long term investment return for the Group while at the same time saving rental expenses. Having considered that the Provisional SPA was entered into on normal commercial terms with the Consideration being determined with reference to the market value of similar properties in similar locations, the Directors are of the view that the terms of the Provisional SPA are fair and reasonable and in the interests of the shareholders of the Company and the Company as a whole. LISTING RULES IMPLICATIONS As one or more of the applicable percentage ratios (as defined in Rule of the Listing Rules) in respect of the Transaction under the Provisional SPA are more than 5% but less than 25%, the Transaction constitutes a discloseable transaction for the Company and is subject to the requirements of notification and announcement, but is exempted from the circular and Shareholders approval requirements under Chapter 14 of the Listing Rules. 5

6 DEFINITIONS Unless the contents otherwise requires, the following expressions have the following meanings in this announcement: Agent Audited Completion Accounts Board Company Completion Completion Date Consideration Director(s) Group HK$ Hong Kong Listing Rules PropWiser Consultants Limited the financial statements of the Target Company comprising statement of profit or loss for the period ending the Completion Date and statement of financial position as at Completion Date audited by practicing certified public accountants the board of Directors Pak Tak International Limited (stock code: 2668), a company incorporated in Bermuda and the Shares of which are listed on the main board of the Stock Exchange completion of the Transaction on 16 May 2018 or such other date as the Purchaser and the Vendor may agree in writing the sum of HK$71,632,000 payable by the Purchaser to the Vendor for the acquisition of the entire issued share capital of the Target Company pursuant to the terms of the Provisional SPA director(s) of the Company the Company and its subsidiaries from time to time Hong Kong dollars, the lawful currency of Hong Kong Hong Kong Special Administrative Region of the People s Republic of China the Rules Governing the Listing of Securities on the Stock Exchange 6

7 NTAV Placing and Subscription Announcement Proforma Completion Accounts Property the aggregate of all tangible assets of the Target Company which are readily convertible into cash or cash equivalent (excluding the Property, any intangible assets and other fixed assets and deferred tax), less all current liabilities (actual, contingent or otherwise but excluding the Shareholder s Loan) and provisions of the Target Company as at Completion Date the announcement of the Company dated 11 October 2017 in relation to the placing of new shares under specific mandate and connected transaction involving subscription of new shares under specific mandate the financial statements of the Target Company comprising statement of profit or loss for the period ending the Completion Date and statement of financial position as at Completion Date Unit 1902, 19/F, Tower 2 Lippo Centre, No. 89 Queensway, Hong Kong Provisional SPA a provisional agreement for sale and purchase dated 5 March 2018 entered into between the Vendor, the Purchaser and the Agent in relation to the Transaction Purchaser Shareholder(s) Sale Share Shareholder s Loan Stock Exchange Golden Flourish Property Limited, a company incorporated in British Virgin Limited, a direct wholly-owned subsidiary of the Company holder(s) of the ordinary share(s) of the Company 10 shares, representing its entire issued share capital of the Target Company All such sum of money advanced by the Vendor to the Target Company and due and owing by Target Company to the Vendor as at the Completion Date The Stock Exchange of Hong Kong Limited 7

8 Target Company Transaction Vendor Confield Worldwide Limited, a company incorporated in the British Virgin Islands with limited liability, which is beneficially owned as to 100% by the Vendor as at the date of this announcement and the sole legal and beneficial owner of the Property the acquisition of the entire issued share capital of the Target Company and take up the assignment of the Shareholder s Loan by the Purchaser from the Vendor pursuant to the terms of the Provisional SPA an individual % per cent. By Order of the Board Pak Tak International Limited Wang Jian Chairman and Chief Executive Officer Hong Kong, 5 March 2018 As at the date of this announcement, the Board comprises Mr. Wang Jian, Ms. Qian Pu and Mr. Feng Guoming as Executive Directors, Mr. Law Fei Shing and Mr. Shin Yick Fabian as Non-executive Directors and Mr. Liu Kam Lung, Mr. Xie Xiaobiao and Mr. Zheng Suijun as Independent Non-executive Directors. 8