Sandmartin International : (1) PROPOSED CAPITAL REORGANISATION; (2) PROPOSED CHANGE IN BOARD LOT SIZE; AND (3) PROPOSED RIGHTS ISSUE ON THE BASIS OF ONE (1) RIGHTS SHARE FOR EVERY TWO (2) ADJUSTED SHARES IN ISSUE ON THE RECORD DATE

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.

Sandmartin International Holdings Limited

聖馬丁國際控股有限公司*

(Incorporated in Bermuda with limited liability)

(Stock Code: 482)

1. 1. (1) PROPOSED CAPITAL REORGANISATION;

   2. PROPOSED CHANGE IN BOARD LOT SIZE; AND
2. PROPOSED RIGHTS ISSUE ON THE BASIS OF ONE (1) RIGHTS SHARE FOR EVERY TWO (2) ADJUSTED SHARES
3. 
   IN ISSUE ON THE RECORD DATE

Financial advisor to the Company

YU MING INVESTMENT MANAGEMENT LIMITED

禹 銘 投 資 管 理 有 限 公 司

1. PROPOSED CAPITAL REORGANISATION
   The Board proposes to implement the Capital Reorganisation which will comprise of the Share Consolidation, the Capital Reduction and the Share Premium Reduction.
   Share Consolidation
   The proposed Share Consolidation will be implemented on the basis that every ten (10) issued and unissued Existing Shares of a par value of HK$0.10 each in the share capital of the Company shall be consolidated into one (1) Consolidated Share of a par value of HK$1.00 each in the share capital of the Company. Any fractional Consolidated Share in the issued share capital of the Company arising from the Share Consolidation will be cancelled.

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Capital Reduction

Immediately upon the Share Consolidation becoming effective, the issued share capital of the Company shall be reduced by (i) rounding down the number of Consolidated Shares in the issued share capital of the Company to the nearest whole number by cancelling any fraction of a Consolidated Share in the issued share capital of the Company; and (ii) cancelling the paid-up capital of the Company to the extent of HK$0.90 on each of the then issued Consolidated Shares such that the par value of each issued Consolidated Share will be reduced from HK$1.00 to HK$0.10.

The credit arising from the Capital Reduction will be credited to the contributed surplus account of the Company within the meaning of the Companies Act and then be applied towards offsetting the accumulated losses of the Company as at the effective date of the Capital Reduction, thereby reducing the accumulated losses of the Company. The balance of credit (if any) thereafter will remain in the contributed surplus account of the Company which may be utilised by the Directors as a distributable reserve or be applied in any other manner as may be permitted under the Bye-laws and all applicable laws of Bermuda.

Share Premium Reduction

The entire amount standing to the credit of the Share Premium Account of the Company is proposed to be reduced to nil.

The Capital Reorganisation is conditional upon fulfilment of the conditions contained in the section headed "Conditions of the Capital Reorganisation" in this announcement which includes, among other things, approval of the Capital Reorganisation by the Shareholders by way of poll at the SGM.

Shareholders and potential investors of the Company should note that the credit arising in the books from the Capital Reduction will be subject to change depending on the number of the Existing Shares in issue immediately prior to the Capital Reorganisation becoming effective.

Shareholders and potential investors are advised to exercise caution when dealing in the securities of the Company. If they are in any doubt, they should consult their professional advisers.

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1. PROPOSED CHANGE IN BOARD LOT SIZE
   As at the date of this announcement, the Existing Shares are traded on the Stock Exchange in the board lot size of 2,000 Existing Shares. The Board proposes to change the board lot size for trading on the Stock Exchange from 2,000 Existing Shares to 10,000 Adjusted Shares conditional upon the Capital Reorganisation becoming effective.
2. PROPOSED RIGHTS ISSUE
   Upon the Capital Reorganisation becomes effective, the Company proposes to raise gross proceeds of no less than HK$63.0 million and up to approximately HK$68.9 million by way of a rights issue of a minimum of 150,000,000 Rights Shares and up to 164,053,835 Rights Shares (assuming no change in the number of Adjusted Shares in issue on or before the Record Date), at the Subscription Price of HK$0.42 per Rights Share on the basis of one (1) Rights Share for every two (2) Adjusted Shares in issue on the Record Date.
   The Rights Issue will only be available to the Qualifying Shareholders and will not be available to the Non-Qualifying Shareholders. There will be no excess application arrangements in relation to the Rights Issue and the Rights Issue is not underwritten. The Unsubscribed Shares will be subject to the Compensatory Arrangement, and any of the Unsubscribed Rights Shares which remain unsold pursuant to the Placing Agreement will not be issued by the Company and the size of the Rights Issue will be reduced accordingly.
   The maximum net proceeds from the Rights Issue after deducting the expenses are estimated to be approximately HK$66.3 million (assuming no change in the number of Adjusted Shares in issue on or before the Record Date).
   The Company intends to apply the net proceeds from the Rights Issue for repayment of outstanding loans and indebtedness of the Company.
   The Placing Agreement
   As there will be no excess application arrangements under the Rights Issue, the Company will make the Compensatory Arrangement in accordance with Rule 7.21(1)(b) of the Listing Rules to dispose of the Unsubscribed Rights Shares by offering them to independent placees for the benefit of the No Action Shareholders. Accordingly, on 28 April 2021 (after trading hours of the Stock Exchange), the Company entered into the Placing Agreement with the Placing Agent in relation to the placing of the Unsubscribed Rights Shares to independent placees on a best effort basis.

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The Rights Issue will proceed on a non-underwritten basis. The Rights Issue is subject to, among others, a minimum of 150,000,000 Rights Shares being validly subscribed by the Qualifying Shareholders and/or placed by the Placing Agent. In the event the Rights Issue is undersubscribed, any Unsubscribed Rights Shares will be placed to independent placees under the Compensatory Arrangement. Any Unsubscribed Rights Shares not placed under the Compensatory Arrangement will not be issued by the Company and the size of the Rights Issue will be reduced accordingly. Investors are advised to exercise caution when dealing in the Shares.

LISTING RULES IMPLICATIONS

As the Rights Issue will not increase either the number of issued shares or the market capitalisation of the Company by more than 50% within the 12-month period immediately preceding the date of this announcement, the Rights Issue is not conditional on approval by the Shareholders pursuant to Rule 7.19A(1) of the Listing Rules.

None of the Shareholders or their associates would have any interest in the Capital Reorganisation which is different from that of other Shareholders. Accordingly, no Shareholder would be required to abstain from voting in favour of the resolution(s) relating to the Capital Reorganisation at the SGM.

GENERAL

The SGM will be convened and held for the Shareholders to consider and, if thought fit, approve the Capital Reorganisation. In compliance with the Listing Rules, all resolutions will be voted on by way of poll at the SGM.

A circular containing, among other things, (i) further details of the proposed Capital Reorganisation and the proposed change in board lot size; and (ii) a notice convening the SGM, is expected to be despatched to the Shareholders on or before Monday, 17 May 2021.

It is expected that the Prospectus Documents setting out details of the Rights Issue will be despatched to the Qualifying Shareholders on Thursday, 24 June 2021 and the Prospectus only will be despatched to the Non-Qualifying Shareholders (if any) for their information only.

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WARNINGS OF THE RISKS OF DEALING IN SHARES AND THE NIL-PAID RIGHTS

The Adjusted Shares will be dealt with on an ex-rights basis from Tuesday, 15 June 2021. Dealings in the nil-paid Rights Shares are expected to take place from Monday, 28 June 2021 to Tuesday, 6 July 2021 (both days inclusive). If the conditions of the Rights Issue (please refer to the section headed "Conditions of the Rights Issue" in this announcement) are not fulfilled, the Rights Issue will not proceed.

Shareholders or other person contemplating transferring, selling or purchasing the Shares and/or nil-paid rights is advised to exercise caution when dealing in the Shares and/or the nil-paid rights. Any person who is in any doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional advisor(s).

Any Shareholder or other person dealing in the Shares or in the nil-paid Rights Shares up to the date on which the Rights Issue becomes unconditional will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed.

1. PROPOSED CAPITAL REORGANISATION
   The Board proposes the Capital Reorganisation to be implemented in the following manner:
2. 1. every ten (10) issued and unissued Existing Shares of a par value of HK$0.10 each in the share capital of the Company shall be consolidated into one (1) Consolidated Share of a par value of HK$1.00 each in the share capital of the Company and any fractional Consolidated Share in the issued share capital of the Company arising from the Share Consolidation will be cancelled;
   2. immediately upon the Share Consolidation becoming effective, the issued share capital of the Company shall be reduced by (a) rounding down the number of Consolidated Shares in the issued share capital of the Company to the nearest whole number by cancelling any fraction of a Consolidated Share in the issued share capital of the Company; and (b) cancelling the paid-up capital of the Company to the extent of HK$0.90 on each of the then issued Consolidated Shares such that the par value of each issued Consolidated Share will be reduced from HK$1.00 to HK$0.10;

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1. immediately following the Capital Reduction, the authorised share capital of the Company be adjusted by reducing the nominal value of all Consolidated Shares from HK$1.00 each to HK$0.10 each resulting in the adjustment of the authorised share capital of the Company from HK$1,000,000,000 divided into 1,000,000,000 Consolidated Shares to HK$1,000,000,000 divided into 10,000,000,000 Adjusted Shares;
2. the entire amount standing to the credit of the Share Premium Account of the Company will be reduced to nil;
3. the credit arising from the Capital Reduction will be transferred to the contributed surplus account of the Company within the meaning of the Companies Act and be applied towards offsetting the accumulated losses of the Company as at the effective date of the Capital Reduction, thereby reducing the accumulated loss of the Company. The balance of credit (if any) thereafter will remain in the contributed surplus account of the Company which may be utilised by the Directors as a distributable reserve or be applied in any other manner as may be permitted under the Bye-laws and all applicable laws of Bermuda; and
4. each of the Adjusted Shares arising from the Capital Reorganisation shall rank pari passu in all respects with each other and will have rights and privileges and be subject to the restrictions contained in the Bye-laws.

Assuming there will be no change in the issued share capital of the Company from the date of this announcement to the date of the Capital Reorganisation becoming effective (without taking into account of the Rights Issue), the share capital structure of the Company (a) as at the date of this announcement; and (b) immediately after the Capital Reorganisation becoming effective will be as follows:

		Immediately after the
		Capital Reorganisation
		becoming effective
		(without taking into
	As at the date of	account of the
	this announcement	Rights Issue)
Amount of authorised	HK$1,000,000,000	HK$1,000,000,000
share capital

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		Immediately after the
		Capital Reorganisation
		becoming effective
		(without taking into
	As at the date of	account of the
	this announcement	Rights Issue)
Par value	HK$0.10 per	HK$0.10 per
	Existing Share	Adjusted Share
Number of authorised	10,000,000,000	10,000,000,000
shares	Existing Shares	Adjusted Shares
Amount of issued share	HK$328,107,671.00	HK$32,810,767.10
capital
Number of issued shares	3,281,076,710	328,107,671
	Existing Shares	Adjusted Shares

The Adjusted Shares in issue immediately following the Capital Reorganisation becoming effective will rank pari passu in all respects with each other and the Capital Reorganisation will not result in any change in the relative rights of the Shareholders.

As at the date of this announcement, the authorised share capital of the Company is HK$1,000,000,000 divided into 10,000,000,000 Existing Shares of HK$0.10 each, of which 3,281,076,710 Existing Shares have been issued as fully paid or credited as fully paid. Immediately after the Capital Reorganisation becoming effective (without taking into account of the Rights Issue), the authorised share capital of the Company will be HK$1,000,000,000 divided into 10,000,000,000 Adjusted Shares of HK$0.10 each, of which 328,107,671 Adjusted Shares will be in issue and the aggregate nominal value of the issued share capital of the Company will be HK$32,810,767.10 (assuming there are no changes in the issued share capital of the Company from the date of this announcement to the date of the Capital Reorganisation becoming effective).

A credit of HK$295,296,903.90 will arise as a result of the Capital Reduction. Such credit will be transferred to the contributed surplus account of the Company and be applied towards offsetting the accumulated losses of the Company as at the effective date of the Capital Reduction within the meaning of the Companies Act.

Shareholders and potential investors of the Company should note that the credit arising in the books from the Capital Reduction will be subject to change depending on the number of the Existing Shares in issue immediately prior to the Capital Reduction becoming effective.

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Under the laws of Bermuda, the Directors may apply the amount standing to the credit of the contributed surplus account in any manner permitted by the laws of Bermuda and the Bye-laws in effect from time to time.

As at the date of this announcement, the Company has no outstanding share options, warrants or convertible bonds in issue.

Conditions of the Capital Reorganisation

The Capital Reorganisation is conditional on:

1. the passing of the necessary special resolution(s) by the Shareholders approving the Capital Reorganisation at the SGM;
2. the Stock Exchange granting the listing of, and permission to deal in the Adjusted Shares arising from the Capital Reorganisation;
3. compliance with the relevant procedures and requirements under the laws of Bermuda and the Listing Rules to effect the Capital Reorganisation; and
4. the obtaining of all necessary approvals from the regulatory authorities or otherwise as may be required in respect of the Capital Reorganisation.

Effects of the Capital Reorganisation

Except for the payment of the related expenses, implementation of the Capital Reorganisation will not, of itself, alter the underlying assets, business operations, management or financial position of the Company or the proportionate interests of the Shareholders. The Board believes that the Capital Reorganisation will not have any material adverse effect on the financial position of the Group.

Except for the expenses involved in relation to the Capital Reorganisation which are expected to be insignificant in the context of the net asset value of the Company, no capital will be lost as a result of the Capital Reorganisation and the net asset value of the Company will remain unchanged before and after the Capital Reorganisation becoming effective. The Capital Reorganisation does not involve any diminution of any liability in respect of any unpaid capital of the Company or the repayment to the Shareholders of any paid-up capital of the Company nor will it result in any change in the relative rights of the Shareholders.

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Listing and dealings

Application will be made to the Stock Exchange for the listing of, and permission to deal in, the Adjusted Shares arising from the Capital Reorganisation and any further Adjusted Shares which may fall to be allotted and issued by the Company.

Subject to the granting of the listing of, and permission to deal in, the Adjusted Shares on the Stock Exchange, as well as compliance with the stock admission requirements of the HKSCC, the Adjusted Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Adjusted Shares on the Stock Exchange or such other date as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time.

The Adjusted Shares will be identical in all respects and rank pari passu in all respects with each other as to all future dividends and distributions which are declared, made or paid. All necessary arrangements will be made for the Adjusted Shares to be admitted into CCASS.

Free exchange of share certificates

Subject to the Capital Reorganisation becoming effective, the Shareholders may, from Friday, 11 June 2021 to Wednesday, 21 July 2021 (both days inclusive), submit share certificates for the Existing Shares to the Registrar, Boardroom Share Registrars (HK) Limited at Room 2103B, 21/F., 148 Electric Road, North Point, Hong Kong to exchange, at the expense of the Company, for new share certificates for the Adjusted Shares. Thereafter, certificates for Existing Shares will be accepted for exchange only on payment of a fee of HK$2.50 (or such other amount as may from time to time be specified by the Stock Exchange) by the Shareholders for each share certificate for the Existing Shares submitted for cancellation or each new share certificate issued for the Adjusted Shares, whichever the number of certificates cancelled/issued is higher. After Wednesday, 21 July 2021, share certificates for the Existing Shares will only remain effective as documents of title and may be exchanged for certificates for the Adjusted Shares at any time but will not be accepted for delivery, trading and settlement purposes.

The colour of the new share certificates for the Adjusted Shares will be announced by the Company in due course.

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1. PROPOSED CHANGE IN BOARD LOT SIZE
   As at the date of this announcement, the Existing Shares are traded on the Stock Exchange in the board lot size of 2,000 Existing Shares. The Board proposes to change the board lot size for trading on the Stock Exchange from 2,000 Existing Shares to 10,000 Adjusted Shares conditional upon the Share Consolidation and Capital Reduction becoming effective.
   Based on the closing price of HK$0.05 per Share as quoted on the Stock Exchange on the Last Trading Day, (i) the market value per board lot of 2,000 Existing Shares is HK$100; and (ii) the theoretical market value per board lot of 10,000 Adjusted Shares (after taking into account the effect of the Capital Reorganisation) would be HK$5,000.
   The change in board lot size will not result in change in the relative rights of the Shareholders.
   ODD LOTS TRADING ARRANGEMENT AND MATCHING SERVICES
   In order to facilitate the trading of odd lots of the Adjusted Shares arising from the Capital Reorganisation and the change in board lot size, the Company will appoint a designated broker to provide a matching service, on a best efforts basis, to those Shareholders who wish to acquire odd lots of the Adjusted Shares to make up a full board lot, or to dispose of their holding of odd lots of the Adjusted Shares for the period from Monday, 28 June 2021 to Wednesday, 11 August 2021 (both days inclusive). Any Shareholder who is in any doubt about the odd lot arrangement is recommended to consult his/her/its own professional advisers. Details of the odd lot arrangement will be provided in the Prospectus.
   Holders of odd lots of the Adjusted Shares should note that the matching of the sale and purchase of odd lots of the Adjusted Shares is not guaranteed.
   REASONS FOR THE CAPITAL REORGANISATION AND THE CHANGE IN BOARD LOT SIZE
   Pursuant to the Companies Act and the Bye-laws, the Company shall not issue any shares at a price below par value. As the Existing Shares are currently trading at a price below par value, in order to facilitate possible fund raising activities in the future, it is necessary to implement the Share Consolidation and Capital Reduction which will give greater flexibility to the Company to issue new Shares in the future.

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Further, pursuant to Rule 13.64 of the Listing Rules, where the market price of the securities of an issuer approaches the extremities of HK$0.01 or HK$9,995.00, the issuer may be required either to change the trading method or to proceed with a consolidation or splitting of its securities.

The "Guide on Trading Arrangements for Selected Types of Corporate Actions" issued by the Hong Kong Exchanges and Clearing Limited on 28 November 2008 and last updated on 1 October 2020 (the "Guide") has further stated that market price of the shares at a level less than HK$0.1 will be considered as trading at extremity as referred to under Rule 13.64 of the Listing Rules. It has also stated in the Guide that taking into account the minimum transaction costs for a securities trade, the expected board lot value should be greater than HK$2,000. For the purpose of reducing transaction costs, the Board proposes the Share Consolidation.

Based on the closing price of HK$0.05 per Share as quoted on the Stock Exchange on the Last Trading Day, (i) the market value per board lot of 2,000 Existing Shares is HK$100; and (ii) the theoretical market value per board lot of 10,000 Adjusted Shares would be HK$5,000. It is expected that the Share Consolidation and the change in board lot size would enable the Company to comply with Rule 13.64 of the Listing Rules.

The Board considers that the Capital Reorganisation and the change in board lot size are beneficial to and in the interests of the Company and the Shareholders as a whole.

1. PROPOSED RIGHTS ISSUE

The Board proposed the Rights Issue, details of which are summarised below:

Basis of the Rights Issue	: One (1) Rights Share (in nil-paid form) for every
		two (2) Adjusted Shares in issue on the Record Date
Subscription Price	:	HK$0.42 per Rights Share
Number of Existing Shares	:	3,281,076,710 Existing Shares
in issue as at the date of
this announcement

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Number of Adjusted Shares	: 328,107,671 Adjusted Shares
in issue upon the Capital
Reorganisation having
become effective (without
taking into account of the
Rights Issue)
Number of Rights Shares	: Not less than 150,000,000 Rights Shares and not
	more than 164,053,835 Rights Shares (assuming no
	change in the number of Adjusted Shares in issue on
	or before the Record Date)
Aggregate nominal value of	: Up to HK$16,405,383.50 (assuming no change in
the Rights Shares	the number of Adjusted Shares in issue on or before
	the Record Date)
Minimum number of issued	: 478,107,671 Adjusted Shares (assuming no change
Adjusted Shares after the	in the number of Shares in issue on or before the
Capital Reorganisation	Record Date and that no new Shares (other than the
and upon completion	Rights Shares) will be allotted and issued on or
of the Rights Issue	before completion of the Rights Issue)
(assuming that the Rights
Issue is fully subscribed)
Maximum number of issued	: 492,161,506 Adjusted Shares (assuming no change
Adjusted Shares after the	in the number of Shares in issue on or before the
Capital Reorganisation	Record Date and that no new Shares (other than the
and upon completion	Rights Shares) will be allotted and issued on or
of the Rights Issue	before completion of the Rights Issue)
(assuming that the Rights
Issue is fully subscribed)
Gross proceeds raised	: Not less than HK$63.0 million and up to
	approximately HK$68.9 million

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There are no options, warrants, derivatives or other convertible securities granted by the Company which confer rights to subscribe for, convert or exchange into Shares that are subsisting as at the date of this announcement.

Assuming no change in the number of issued Adjusted Shares on or before the Record Date and that no new Shares (other than the Rights Shares) will be allotted and issued on or before completion of the Rights Issue, the maximum of 164,053,835 Rights Shares proposed to be issued pursuant to the terms of the Rights Issue represent:

1. approximately 50% of the issued share capital of the Company after completion of the Capital Reorganisation; and (ii) approximately 33.33% of the issued share capital of the Company as enlarged by the allotment and issue of the Rights Shares.

Non-underwritten basis

The Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptance of the provisionally allotted Rights Shares. In the event that the Rights Issue is not fully subscribed, any Unsubscribed Rights Shares will be placed to independent placees on a best efforts basis under the Compensatory Arrangement. Any Unsubscribed Rights Shares which are not placed under the Compensatory Arrangement will not be issued by the Company and the size of the Rights Issue will be reduced accordingly.

As the Rights Issue will proceed on a non-underwritten basis, any Shareholder who applies to take up all or part of his/her/its entitlement under the PAL(s) may unwittingly incur an obligation to make a general offer for the Shares under the Takeovers Code, unless a waiver from the Executive has been obtained.

No irrevocable commitments

As at the date of this announcement, the Company has not received any information or irrevocable undertaking from any other Shareholders of their intention in relation to the Rights Shares to be allotted and issued to them under the Rights Issue.

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Subscription price

The Subscription Price is HK$0.42 per Rights Share, payable in full upon acceptance of the relevant provisional allotment of Rights Shares or when a transferee of nil-paid Rights Shares applies for the Rights Shares.

The Subscription Price represents:

1. a discount of approximately 16.00% to the theoretical closing price of HK$0.500 per Adjusted Share (after taking into account the effect of the Capital Reorganisation) based on the closing price of HK$0.050 per Existing Share as quoted on the Stock Exchange on the date of this announcement;
2. a discount of approximately 16.00% to the average of the theoretical closing prices per Adjusted Share (after taking into account the effect of the Capital Reorganisation) as quoted on the Stock Exchange for the five (5) previous consecutive trading days up to and including the Last Trading Day of HK$0.500;
3. a discount of approximately 14.81% to the average of the theoretical closing prices per Adjusted Share (after taking into account the effect of the Capital Reorganisation) as quoted on the Stock Exchange for the ten (10) previous consecutive trading days up to and including the Last Trading Day of HK$0.493;
4. a discount of approximately 11.21% to the theoretical ex-rights price of approximately HK$0.473 per Adjusted Share based on the theoretical closing price of HK$0.500 per Adjusted Share (after taking into account the effect of the Capital Reorganisation) as quoted on the Stock Exchange on the Last Trading Day and for the five (5) previous consecutive trading days up to and including the Last Trading Day;
5. a premium of approximately 854.55% over the equity attributable to Shareholders of approximately HK$0.044 per Adjusted Share based on the audited consolidated equity attributable to the Shareholders of approximately HK$14,432,000 as at 31 December 2020 as extracted from the annual report of the Company for the year ended 31 December 2020 and 328,107,671 Adjusted Shares in issue (assuming the Capital Reorganisation has become effective as at 31 December 2020); and

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1. a dilution effect of approximately 5.33% to the existing Shareholders if they elect not to participate in the Rights Issue, which is calculated based on the theoretical ex-rights price of approximately HK$0.473 per Adjusted Share (taking into account the theoretical closing price of HK$0.500 per Adjusted Share on the Last Trading Day (after taking into account the effect of the Capital Reorganisation)) and the average of the theoretical closing prices as quoted on the Stock Exchange for the five (5) previous consecutive trading days up to and including the Last Trading Day of HK$0.500 per Adjusted Share (after taking into account the effect of the Capital Reorganisation).

The net price per Rights Share (i.e. the aggregate Subscription Price of the maximum number of Rights Shares less costs and expenses estimated to be incurred in the Rights Issue divided by the maximum number of Rights Shares), assuming that the Rights Issue is fully taken up, will be approximately HK$0.40.

The Subscription Price was determined by the Company with reference to (i) the average closing price of the Shares (after taking into account the effect of the Capital Reorganisation) quoted on the Stock Exchange of approximately HK$0.43 for the three months up to and including the Last Trading Day; (ii) the highest and lowest closing price of the Shares (after taking into account the effect of the Capital Reorganisation) quoted on the Stock Exchange of HK$0.50 and HK$0.33 respectively for the three months up to and including the Last Trading Day; and (iii) the potential impact of the continuing global COVID-19 pandemic on the global economy which may affect the future business operation of the Company and the ability/willingness of its Shareholders to subscribe for the Rights Shares under the Rights Issue.

The Directors consider that, despite any potential dilution impact of the Rights Issue on the shareholding interests of the Shareholders, the terms of the Rights Issue, including the Subscription Price, are fair and reasonable and in the interests of the Company and the Shareholders as a whole, after taking into account the following factors: (i) the Qualifying Shareholders are provided with an equal opportunity to subscribe for their assured entitlements under the Rights Issue for the purpose of maintaining their respective existing shareholding interests in the Company; (ii) the Subscription Price is approximate to the average close price of the Shares of approximately HK$0.43 in the past three months; and (iii) the Subscription Price represents a discount of approximately 16.00% and 14.81% to the closing price of the Shares on the date of this announcement and the average of the closing prices of the Shares for the last ten (10)

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trading days up to and including the Last Trading Day respectively, and such discounts would encourage the Qualifying Shareholders to subscribe for their assured entitlements under the Rights Issue.

Status of the Rights Shares

The Rights Shares (when allotted, issued and fully paid) will rank pari passu in all respects with the Adjusted Shares then in issue after the Capital Reorganisation becomes effective. Holders of fully-paid Rights Shares will be entitled to receive all future dividends and distributions which may be declared, made or paid with a record date falling on or after the date of allotment and issue of the Rights Shares in their fully-paid form.

Qualifying Shareholders

To qualify for the Rights Issue, a Qualifying Shareholder must be registered as a member of the Company on the Record Date and not being a Non-Qualifying Shareholder. In order to be registered as members of the Company on the Record Date, all transfers of Shares (together with the relevant share certificate(s)) must be lodged with the Registrar, Boardroom Share Registrars (HK) Limited at Room 2103B, 21/F., 148 Electric Road, North Point, Hong Kong by not later than 4:30 p.m. on Wednesday, 16 June 2021. It is expected that the last day of dealings in the Adjusted Shares on a cum-rights basis is Friday, 11 June 2021 and the Shares will be dealt with on an ex-rights basis from Tuesday, 15 June 2021.

The Company will despatch the Prospectus Documents to the Qualifying Shareholders on the Prospectus Posting Date.

Application for all or any part of a Qualifying Shareholder's entitlement to the Rights Shares should be made by completing the PAL and lodging the same with a cheque drawn on an account with, or bank cashier's order issued by, a licensed bank in Hong Kong for the Rights Shares being applied for with the Registrar, Boardroom Share Registrars (HK) Limited at Room 2103B, 21/F., 148 Electric Road, North Point, Hong Kong on or before the Latest Time for Acceptance.

The Qualifying Shareholders who take up their pro-rata entitlement in full will not experience any dilution to their interests in the Company (except in relation to any dilution resulting from the taking up by third parties of any Rights Shares arising from the aggregation of fractional entitlements). If a Qualifying Shareholder does not take up any of his/her/its entitlements in full under the Rights Issue, his/her/its proportionate shareholding in the Company will be diluted.

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Non-Qualifying Shareholders

The Prospectus Documents will not be registered or filed under the applicable securities legislation of any jurisdiction other than Hong Kong. As at 31 March 2021, there were a total of 15 Overseas Shareholders located in Taiwan and the United States of America.

The Board will make enquiries regarding the legal restrictions under the laws of the relevant overseas place(s) and the requirements of the relevant regulatory body or stock exchange pursuant to Rule 13.36(2)(a) of the Listing Rules. If, after making such enquiries and based on legal opinions provided by the legal advisers to the Company, the Board is of the opinion that it would be necessary or expedient not to offer the Rights Shares to any Overseas Shareholders on account either of the legal restrictions under the laws of the relevant place(s) or the requirements of the relevant regulatory body or stock exchange in the relevant place(s), no offer of the Rights Shares will be made to such Overseas Shareholders. Accordingly, the Rights Issue will not be extended to such Overseas Shareholders.

The Company will send copies of the Overseas Letter and the Prospectus to the Non-Qualifying Shareholders for their information only, but will not send the PAL to them. Overseas Shareholders may not be eligible to take part in the Rights Issue as explained above.

The Non-Qualifying Shareholders (which are excluded from the Rights Issue) would not have any entitlement under the Rights Issue. Such Rights Shares will form part of the Unsubscribed Rights Shares and if possible be placed by the Placing Agent to independent placees under the Compensatory Arrangement.

Arrangements will be made for the Rights Shares, which would otherwise have been provisionally allotted to the Non-Qualifying Shareholders in their nil-paid form, to be sold in the market as soon as practicable after dealings in the nil-paid Rights Shares commence, and in any event before the last day for dealings in nil-paid Rights Shares if a premium (net of expenses) can be obtained. Proceeds of each sale, less expenses and stamp duty, of not less than HK$100 will be paid pro-rata (rounded down to the nearest cent) to the relevant Non-Qualifying Shareholder(s) in Hong Kong dollars. The Company will retain individual amount of less than HK$100 for its own benefit.

- 17 -

Any unsold entitlements of the Non-Qualifying Shareholders will be placed by the Placing Agent under the Placing Agreement together with Rights Shares that are not being taken up by the Qualifying Shareholders.

For the nil-paid Rights Shares that were sold in the market by the Company and the buyer of such nil-paid Rights Shares who will not take up the entitlement, such Unsubscribed Rights Shares will be subject to the Compensatory Arrangement under the Placing Agreement.

For details of the Compensatory Arrangement, please refer to the section headed "No excess application and procedures in respect of the Unsubscribed Rights Shares" in this announcement.

The Company reserves the right to treat as invalid any acceptance of or applications for Rights Shares where it believes that such acceptance or application would violate the applicable securities or other laws or regulations of any territory or jurisdiction. Accordingly, Non-Qualifying Shareholders should exercise caution when dealing in the Shares.

Conditions of the Rights Issue

The Rights Issue is conditional upon:

1. the Capital Reorganisation having become effective;
2. the delivery to the Stock Exchange for authorisation and the registration with the Registrar of Companies in Hong Kong respectively of one copy of each of the Prospectus Documents duly certified by the Directors (or by their agents duly authorised in writing) as having been approved by resolution of the Directors (and all other documents required to be attached thereto) and otherwise in compliance with the Listing Rules and the Companies (Winding Up and Miscellaneous Provisions) Ordinance not later than the Prospectus Posting Date;
3. the posting of copies of the Prospectus Documents to the Qualifying Shareholders by the Prospectus Posting Date and the posting of the Prospectus and a letter to the Non-Qualifying Shareholders, if any, for information purpose only explaining the circumstances in which they are not permitted to participate in the Rights Issue on or before the Prospectus Posting Date;

- 18 -

1. the Listing Committee granting or agreeing to grant (subject to allotment) and not having withdrawn or revoked listing of and permission to deal in the Rights Shares (in their nil-paid and fully-paid forms) by no later than the Business Day prior to the first day of their dealings;
2. compliance with the requirements under the applicable laws and regulations of Hong Kong and Bermuda; and
3. not less than 150,000,000 Rights Shares being issued under Rights Issue and/or the Compensatory Arrangement.

The above conditions precedent are incapable of being waived. If any of the conditions referred to above is not fulfilled on or before the Long Stop Date, the Rights Issue will not proceed.

As the Rights Issue is subject to the above conditions, it may or may not proceed.

Stamp duty and other applicable fees and charges

Dealings in the Rights Shares (in both nil-paid and fully-paid forms) will be subject to the payment of stamp duty, Stock Exchange trading fee, Securities and Futures Commission transaction levy and other applicable fees and charges in Hong Kong.

Share certificates for the Rights Shares and refund cheques

Subject to the fulfilment of the conditions of the Rights Issue, share certificates for all fully-paid Rights Shares are expected to be sent by ordinary post on or before Wednesday, 21 July 2021 to those persons who have validly accepted and, where applicable, applied for, and paid for the Rights Shares, at their own risk, to their registered addresses.

If the Rights Issue does not proceed, the monies received by the Company in respect of the subscription of the Rights Shares will be refunded to the Qualifying Shareholders or such other person to whom the nil-paid rights have been validly renounced or transferred or, in the case of joint acceptances, to the first-named person, without interest and by means of cheques despatched by ordinary post at the risk of such Qualifying Shareholders or such other person to their registered addresses by the Registrar on or around Wednesday, 21 July 2021.

- 19 -

Application for listing

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both nil-paid and fully-paid forms. No part of the securities of the Company in issue or for which listing or permission to deal is being or is proposed to be sought is listed or dealt in or on any other stock exchange.

It is expected that dealings in the Rights Shares in nil-paid form will commence on Monday, 28 June 2021 and will end on Tuesday, 6 July 2021 (both days inclusive) and dealings in the Rights Shares in fully-paid form will commence on Thursday, 22 July 2021.

Rights Shares will be eligible for admission into CCASS

Subject to the granting of the listing of, and permission to deal in, the Rights Shares in both nil-paid and fully-paid forms on the Stock Exchange as well as compliance with the stock admission requirements of HKSCC, the Rights Shares in both their nil-paid and fully-paid forms will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Rights Shares on the Stock Exchange or such other date as to be determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter.

All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time. Shareholders should seek advice from their licensed securities dealer(s) or other professional adviser(s) for details of those settlement arrangements and how such arrangements will affect their rights and interests.

Fractions of the Rights Shares

Fractional Rights Shares to which an individual Shareholder is entitled to will not be issued by the Company to such Shareholder. Any such fractional entitlements to the Rights Shares will be aggregated and sold and the proceeds therefrom will be retained for the benefit of the Company.

- 20 -

No excess application and procedures in respect of the Unsubscribed Rights Shares

There will be no excess application arrangements in relation to the Rights Issue as stipulated under Rule 7.21(1)(a) of the Listing Rules. However, according to Rule 7.21(1)(b) of the Listing Rules, there will be the Compensatory Arrangement to dispose of the Unsubscribed Rights Shares by offering the Unsubscribed Rights Shares to independent placees for the benefit of the No Action Shareholders to whom they were offered by way of the Rights Issue.

Accordingly, on Wednesday, 28 April 2021 (after trading hours of the Stock Exchange), the Company entered into the Placing Agreement with the Placing Agent in relation to the placing of the Unsubscribed Rights Shares to independent placees on a best efforts basis.

Pursuant to the Placing Agreement, the Company has appointed the Placing Agent to place the Unsubscribed Rights Shares during the Placing Period to independent placees on a best efforts basis, and any premium over the Subscription Price (after deduction of a proportionate share of the placing commission) for those Rights Shares that is realised will be paid to those No Action Shareholders on a pro-rata basis. The Placing Agent will, on a best efforts basis, procure, by not later than Friday, 16 July 2021, acquirers for all (or as many as possible) of those Unsubscribed Rights Shares. Any Unsubscribed Rights Shares which are not placed under the Compensatory Arrangements will not be issued by the Company and the size of the Rights Issue will be reduced accordingly.

Net Gain (if any) will be paid (without interest) to the No Action Shareholders as set out below on pro rata basis (but rounded down to the nearest cent):

1. the relevant Qualifying Shareholders (or such persons who hold any nil-paid rights at the time such nil-paid rights lapse) whose nil-paid rights are not validly applied for in full, by reference to the extent that Shares in his/her/its nil-paid rights are not validly applied for; and
2. the relevant Non-Qualifying Shareholders with reference to their shareholdings in the Company on the Record Date.

If and to the extent in respect of any Net Gain, any No Action Shareholders become entitled on the basis described above to an amount of HK$100 or more, such amount will be paid to the relevant No Action Shareholder(s) in Hong Kong Dollars only and the Company will retain individual amounts of less than HK$100 for its own benefit.

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Placing Agreement for the Unsubscribed Rights Shares

Details of the Placing Agreement are summarised as follows:

Date	:	28 April 2021
Issuer	:	The Company
Placing Agent	:	Morton Securities Limited
Placing Period	: The period commencing from the second Business Day
		after the Latest Time for Acceptance and ending on the
		fifth Business Day after the Latest Time for Acceptance.
Commission and	: Subject to completion of the Placing Agreement, the
expenses		Company shall pay to the Placing Agent a placing
		commission in Hong Kong dollars, of 2.0% of the amount
		which is equal to the placing price multiplied by the
		number of Unsubscribed Rights Shares that have been
		successfully placed by the Placing Agent pursuant to the
		terms of the Placing Agreement.
Placing price of	: The placing price of the Unsubscribed Rights Shares
the Unsubscribed		shall be not less than the Subscription Price and the final
Rights Shares		price determination will depend on the demand for and
		the market conditions of the Unsubscribed Rights Shares
		during the process of the placement.
Placees	: The Unsubscribed Rights Shares shall be placed to
		placee(s), who and whose ultimate beneficial owner(s)
		shall be Independent Third Party(ies).

Conditions of the Placing Agreement

Completion of the Placing Agreement is conditional upon, among others, the following conditions being fulfilled:

1. the Capital Reorganisation having become effective;
2. the Listing Committee of the Stock Exchange granting or agreeing to grant (subject to allotment) and not having withdrawn or revoked, the approval for the listing of, and permission to deal in, the Adjusted Shares and the Rights Shares (in their nil-paid and fully-paid forms);

- 22 -

1. the filing and registration of all the Prospectus Documents (together with any other documents required by applicable law or regulation to be annexed thereto) with the Registrar of Companies in Hong Kong by no later than the Prospectus Posting Date;
2. the posting of copies of the Prospectus Documents to the Qualifying Shareholders and the posting of the Prospectus (stamped "For Information Only") to the Non-Qualifying Shareholders for information purpose only by no later than the Prospectus Posting Date;
3. the Placing Agreement not having been terminated in accordance with the provisions thereof; and
4. not less than 150,000,000 Rights Shares being issued under the Rights Issue and/or the Compensatory Arrangement.

In the event that the above condition precedents have not been fulfilled on or before the Long Stop Date, the obligations and liabilities of the Company under the Placing Agreement shall be null and void and the Company shall be released from all rights and obligations in relation thereto (save for any antecedent breaches of and certain costs and expenses in connection with the Placing Agreement).

The Placing Agent shall ensure that the Compensatory Arrangement will not (i) trigger any mandatory offer obligation on the part of any placee under Rule 26.1 of the Takeovers Code; and (ii) result in the Company not fulfilling the public float requirements under Rule 8.08 of the Listing Rules.

The Placing Agent confirmed that it is an Independent Third Party. The terms of the Placing Agreement, including the commission payable, were determined after arm's length negotiation between the Placing Agent and the Company with reference to the prevailing market rate and the Directors consider the terms to be normal commercial terms.

As the Compensatory Arrangement will provide (i) a distribution channel of the Unsubscribed Rights Shares; and (ii) a compensatory mechanism for the No Action Shareholders, the Directors consider that the Compensatory Arrangement is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

- 23 -

SHAREHOLDING STRUCTURE

Set out below is the shareholding structure of the Company (i) as at the date of this announcement; (ii) immediately after completion of the Capital Reorganisation (without taking into account of the Rights Issue); (iii) immediately after completion of the Capital Reorganisation and the Rights Issue assuming all Shareholders have taken up all the entitled Rights Shares; (iv) immediately after completion of the Capital Reorganisation and the Rights Issue assuming none of the Qualifying Shareholders have taken up any entitled Rights Shares and none of the Unsubscribed Rights Shares were subscribed for through the Placing Agent; and (v) immediately after completion of the Capital Reorganisation and the Rights Issue assuming none of the Qualifying Shareholders have taken up any entitled Rights Shares and all the Unsubscribed Rights Shares were subscribed for through the Placing Agent:

																Immediately after completion	Immediately after completion
																of the Capital Reorganisation	of the Capital Reorganisation
																and the Rights Issue	and the Rights Issue
																(assuming none of the	(assuming none of the
											Immediately after completion	Qualifying Shareholders have	Qualifying Shareholders have
											of the Capital Reorganisation	taken up any entitled Rights	taken up any entitled Rights
						Immediately after completion	and the Rights Issue	Shares and none of the	Shares and all the
						of the Capital Reorganisation	(assuming all Shareholders	Unsubscribed Rights Shares	Unsubscribed Rights Shares
	As at the date of	(without taking into account	have taken up all the entitled	were subscribed for through	were subscribed for through
	this announcement	of the Rights Issue)	Rights Shares)	the Placing Agent)	the Placing Agent)
	Number of				Number of				Number of				Number of				Number of
	issued	Approximate	issued	Approximate	issued	Approximate	issued	Approximate	issued	Approximate
	Existing Shares	%	Adjusted Shares	%	Adjusted Shares	%	Adjusted Shares	%	Adjusted Shares	%
Substantial
Shareholder
First Steamship	950,859,347
Company Limited	(Note1)	29.0%		95,085,934		29.0%		142,628,901		29.0%		95,085,934		29.0%		95,085,934		19.3%
Metroasset Investments	507,188,592
Limited	(Note2)	15.4%		50,718,859		15.4%		76,078,288		15.4%		50,718,859		15.4%		50,718,859		10.3%
Public Shareholder
Placees	-		-	-		-	-		-	-		-	164,053,835		33.3%
Other Shareholders	1,823,028,771		55.6%		182,302,878		55.6%		273,454,317		55.6%		182,302,878		55.6%		182,302,878		37.1%
Total	3,281,076,710		100.00		328,107,671		100.00		492,161,506		100.00		328,107,671		100.00		492,161,506		100.00

Notes:

1. First Steamship Company Limited is interested in 950,859,347 Shares through First Mariner Holding Limited, its wholly-owned subsidiary, which holds 833,000,000 Shares and Grand Citi Limited, its non-wholly owned subsidiary, which holds 117,859,347 Shares.
2. These Shares are held by Metroasset Investments Limited, 45.09% and 43.38% of the issued share capital of which are beneficially owned by Mr. Hung Tsung Chin (an executive Director of the Company) and Ms. Chen Mei Huei (spouse of Mr. Hung Tsung Chin) respectively.

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EXPECTED TIMETABLE

The expected timetable for the Capital Reorganisation and the Rights Issue is set out below and is subject to change. Any such change will be further announced by the Company as and when appropriate.

Event	Date (Hong Kong time)
		2021
Despatch of Company's circular in relation to
the Capital Reorganisation to the Shareholders
together with notice of SGM and
proxy form for SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . Monday, 17	May
Latest time for lodging transfer documents of
the Shares to qualify for attendance and
voting at the SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4:30 p.m. on Friday, 28	May

Closure of register of members of

the Company for determining the identity of the Shareholders entitled to attend and

vote at the SGM (both dates inclusive) . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 31 May to Wednesday, 9 June

Latest time for lodging proxy forms for the SGM . . . . . . .	. . 10:30 a.m. on Monday, 7 June
Record date for attendance and voting at the SGM . . . . . .	. . . . . . . . . . . . Wednesday, 9 June
Expected date and time of the SGM to approve
the Capital Reorganisation . . . . . . . . . . . . . . . . . . . . . . . .	10:30 a.m. on Wednesday, 9 June
Announcement of the poll results of the SGM . . . . . . . . . .	. . . . . . . . . . . . Wednesday, 9 June
Register of members re-opens . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . Thursday, 10	June
Effective date for the Capital Reorganisation . . . . . . . . . . .	. . . . . . . . . . . . . . . Friday, 11	June
First day for free exchange of existing share
certificates for new share certificates . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . Friday, 11	June
Dealing in Adjusted Shares commences . . . . . . . . . . . . . . . .	. . . 9:00 a.m. on Friday, 11	June

- 25 -

Original counter for trading in Existing Shares
in board lots of 2,000 Shares
(in the form of existing share certificates)
temporarily closes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . 9:00 a.m. on Friday, 11 June
Temporary counter for trading in Adjusted Shares
in board lots of 200 Adjusted Shares
(in the form of existing share certificates) opens . . . . .	. . . . 9:00 a.m. on Friday, 11 June
Last day of dealings in the Adjusted Shares
on a cum-rights basis relating to
the Rights Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . Friday, 11 June
First day of dealings in Adjusted Shares
on an ex-rights basis relating to the Rights Issue . . . . . .	. . . . . . . . . . . . . . Tuesday, 15 June
Latest time for the Shareholders to
lodge transfer documents of Adjusted Shares
in order to be qualified for the Rights Issue . . . . . . . . . .	4:30 p.m. on Wednesday, 16 June
Closure of register of members to determine
the eligibility of the Rights Issue
(both dates inclusive) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . Thursday, 17 June
	to Wednesday, 23 June
Record date for the Rights Issue . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . Wednesday, 23 June
Register of members re-opens . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . Thursday, 24 June

Despatch of the Prospectus Documents

(including the PAL and the Prospectus)

(in case of the Non-Qualifying Shareholders,

the Prospectus only) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thursday, 24 June

First day of dealings in nil-paid Rights Share . . . . . . . . . . . . . . . . . . . . . . .

Monday, 28 June

- 26 -

Original counter for trading in Adjusted Shares
in board lots of 10,000 Adjusted Shares
(in the form of new share certificates) re-opens . . . . . .	. . 9:00 a.m. on Monday, 28	June
Parallel trading in Adjusted Shares
(in the form of new share certificates and
existing share certificates) commences . . . . . . . . . . . . . .	. . 9:00 a.m. on Monday, 28	June
Designated broker starts to stand in the market
to provide matching services for odd lots of
the Adjusted Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . 9:00 a.m. on Monday, 28	June
Latest time for splitting the PAL . . . . . . . . . . . . . . . . . . . . .	4:30 p.m. on Wednesday, 30	June
Last day of dealing in nil-paid Rights Shares . . . . . . . . . . .	. . . . . . . . . . . . . . . Tuesday, 6 July

Latest time for acceptance of and payment for

the Rights Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Friday, 9 July

Announcement of the number of Unsubscribed Rights Shares . . . . . . . . . .

Monday, 12 July

Commencement of placing of Unsubscribed Rights Shares

by the Placing Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 13 July

Latest time of placing of the Unsubscribed Rights Shares

by the Placing Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 16 July

Temporary counter for trading in Adjusted Shares
in board lots of 200 Adjusted Shares
(in the form of existing share certificates) closes . . . . . . . .	4:10 p.m. on Monday, 19 July
Parallel trading in Adjusted Shares
(represented by both existing share certificates and
new share certificates) ends . . . . . . . . . . . . . . . . . . . . . . . . . . .	4:10 p.m. on Monday, 19 July

Announcement of results of the Rights Issue (including results of the placing of

the Unsubscribed Rights Shares) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 20 July

Despatch of share certificates for fully-paid
Rights Shares or refund cheques for payment
for Rights Shares if the Rights Issue does not proceed . . . . . . . . . . .	Wednesday, 21 July

- 27 -

Latest time for free exchange of existing share certificates
for new share certificates . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . Wednesday, 21	July
Commencement of dealings in
fully-paid Rights Shares . . . . . . . . . . . . . . . . . . . . . . . .	. . . . 9:00 a.m. on Thursday, 22	July
Payment of the Net Gain to relevant
No Action Shareholders (if any) . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . Thursday, 5	August
Designated broker ceases to provide
matching services for odd lots of
the Adjusted Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4:00 p.m. on Wednesday, 11	August

This timetable is indicative only and may be extended or varied. Any change to the expected timetable above will be announced by the Company as and when appropriate.

EFFECT OF BAD WEATHER ON THE LATEST TIME FOR ACCEPTANCE OF AND PAYMENT FOR THE RIGHTS SHARES

The latest time for acceptance of and payment for the Rights Shares will not take place if a tropical cyclone warning signal no. 8 or above, or "extreme conditions'' caused by super typhoons, or a black rainstorm warning is:

1. in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on the Latest Acceptance Date. Instead the deadline for acceptance of and payment for the Rights Shares will be extended to 5:00 p.m. on the same Business Day; and
2. in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on the Latest Acceptance Date. Instead the deadline for acceptance of and payment for the Rights Shares will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force at any time between 9:00 a.m. and 4:00 p.m.

If the latest time for acceptance of and payment for the Rights Shares does not take place on the Latest Acceptance Date, the dates mentioned in the section headed "Expected Timetable" in this announcement may be affected. The Company will notify the Shareholders by way of announcement(s) of any change to the expected timetable as soon as practicable.

- 28 -

CLOSURE OF REGISTER OF MEMBERS

The register of members of the Company will be closed from Monday, 31 May 2021 to Wednesday, 9 June 2021 (both days inclusive) for determining the identity of the Shareholders entitled to attend and vote at the SGM and from Thursday, 17 June 2021 to Wednesday, 23 June 2021 (both days inclusive) for determining the entitlement to the Rights Shares. No transfer of Existing Shares or Adjusted Shares will be registered during the above book closure periods.

REASONS FOR AND BENEFITS OF THE RIGHTS ISSUE AND USE OF PROCEEDS

The Group is principally engaged in designing, manufacturing and trading of media entertainment platform-related products and connectors, cable, and assorted electronic accessories as well as satellite television service operator business.

As disclosed in the annual report of the Company for the year ended 31 December 2020, as at 31 December 2020, the bank and other borrowing of the Company amounts to approximately HK$413 million ("Outstanding Loans"), out of which approximately HK$383.1 million is current liabilities. The interest rate of the Outstanding Loans ranged between 0.81% and 10%. For the year ended 31 December 2020, the Group incurred finance costs of approximately HK$29.8 million.

The Company intends to apply the net proceeds of approximately HK$66.3 million from the Rights Issue (assuming no further issue of new Shares or repurchase of Shares on or before the Record Date and full subscription of the Rights Shares) for repayment of the Outstanding Loans with the highest interest rate of 10%. It is estimated that the finance costs of the Group will reduce by approximately HK$6.6 million per annum after repayment such Outstanding Loans.

The Company has considered alternative fundraising methods which include debt financing or placing of new Shares. For debt financing, in light of the loss-making position of the Group for the year ended 31 December 2020 and relatively high gearing ratio of the Group, it is difficult for the Group to obtain loans with lower interest rate. For placing of new Shares, it would dilute the shareholding of the existing Shareholders while the Rights Issue will allow the Qualifying Shareholders to maintain their respective pro rata shareholdings in the Company.

In view of the above, the Directors consider that the Rights Issue is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

- 29 -

FUND RAISING EXERCISE OF THE COMPANY IN THE PAST 12 MONTHS

The Company has conducted the following fundraising activity in the past twelve months immediately preceding the date of this announcement:

Date of				Actual use of
announcement	Event	Net proceeds	Intended use of proceeds	proceeds
6 and 10 August	Subscription of	Approximately	HK$7,000,000 for	Utilised in full
2020	100,000,000 Existing	HK$9.8 million.	replenishing the	as intended.
	Shares under general		liquidity of the Company
	mandate granted by the		and HK$2,800,000 for
	Shareholders at the		general working capital
	annual general meeting		of the Group.
	of the Company held on
	29 June 2020.

Save as abovementioned, the Company had not conducted any other fundraising exercise in the past twelve months immediately preceding the date of this announcement.

LISTING RULES IMPLICATIONS

As the Rights Issue will not increase either the number of issued shares or the market capitalisation of the Company by more than 50% within the 12-month period immediately preceding the date of this announcement, the Rights Issue is not conditional on approval by the Shareholders pursuant to Rule 7.19A(1) of the Listing Rules.

None of the Shareholders or their associates would have any interest in the Capital Reorganisation which is different from that of other Shareholders. Accordingly, no Shareholder would be required to abstain from voting in favour of the resolution(s) relating to the Capital Reorganisation at the SGM.

The Rights Issue is subject to the satisfaction of the conditions as set out under the section headed "Conditions of the Rights Issue" in this announcement and accordingly, the Rights Issue may or may not proceed. The publication of this announcement does not in any way imply that the Rights Issue will be implemented or completed. Shareholders and potential investors of the Company are reminded to exercise caution when dealing in the Shares. Persons who are in doubt as to the action they should take should consult their professional advisor(s).

- 30 -

GENERAL

The SGM will be convened and held for the Shareholders to consider and, if thought fit, approve the Capital Reorganisation. In compliance with the Listing Rules, all resolutions will be voted on by way of poll at the SGM.

A circular containing, among other things, (i) further details of the proposed Capital Reorganisation and the proposed change in board lot size; and (ii) a notice convening the SGM, is expected to be despatched to the Shareholders on or before Monday, 17 May 2021.

It is expected that the Prospectus Documents setting out details of the Rights Issue will be despatched to the Qualifying Shareholders on Thursday, 24 June 2021 and the Prospectus only will be despatched to the Non-Qualifying Shareholders (if any) for their information only.

WARNING OF THE RISKS OF DEALING IN SHARES AND THE NIL PAID RIGHTS

The Shares will be dealt on an ex-rights basis from Tuesday, 15 June 2021. Dealings in the nil-paid rights are expected to take place from Monday, 28 June 2021 to Tuesday, 6 July 2021 (both days inclusive). If the conditions of the Rights Issue (please refer to the section headed "Conditions of the Rights Issue'' in this announcement) are not fulfilled, the Rights Issue will not proceed.

Shareholders or other person contemplating transferring, selling or purchasing the Shares and/or nil-paid rights is advised to exercise caution when dealing in the Shares and/or the nil-paid rights. Any person who is in any doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional advisor(s).

Any Shareholder or other person dealing in the Shares or in the nil-paid rights up to the time at which the Rights Issue becomes unconditional will accordingly bear the risk that the Rights Issue may not become unconditional and may not proceed.

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DEFINITIONS

In this announcement, the following expressions have the meaning set out below unless the context requires otherwise:

"Adjusted Shares"	ordinary share(s) with par value of HK$0.10 each in the
	share capital of the Company immediately following the
	Capital Reorganisation becoming effective
"associate(s)"	has the meaning ascribed to such term in the Listing Rules
"Board"	the board of Directors
"Business Day(s)"	any day(s) (excluding Saturday) on which banks are open
	for business in Hong Kong
"Bye-laws"	the bye-laws of the Company, as amended from time to time
"Capital Reduction"	the reduction of the issued share capital of the Company by
	cancelling any fraction of a Consolidated Share in the issued
	share capital of the Company and cancelling the paid up
	capital of the Company to the extent of HK$0.90 on each of
	the then issued Consolidated Shares such that the par value
	of each issued Consolidated Share will be reduced from
	HK$1.00 to HK$0.10
"Capital Reorganisation"	the proposed reorganisation of the share capital of the
	Company involving the Share Consolidation, the Capital
	Reduction and the Share Premium Reduction
"CCASS"	the Central Clearing and Settlement System established and
	operated by HKSCC
"Companies Act"	the Companies Act 1981 of Bermuda
"Company"	Sandmartin International Holdings Limited, a company
	incorporated in Bermuda with limited liability, the ordinary
	shares of which are listed on the Main Board of the Stock
	Exchange (stock code: 482)

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"Compensatory	placement of the Unsubscribed Rights Shares by the Placing
Arrangement"	Agent on a best efforts basis pursuant to the Placing
	Agreement
"connected person(s)"	has the same meaning ascribed thereto under the Listing
	Rules
"Consolidated Share"	ordinary share(s) with par value of HK$1.00 each in the
	share capital of the Company immediately following the
	Share Consolidation becoming effective
"Director(s)"	director(s) of the Company
"Executive"	the Executive Director of the Corporate Finance Division of
	the Securities and Futures Commission or any delegate of
	the Executive Director
"Existing Shares"	ordinary share(s) with par value of HK$0.10 each in the
	share capital of the Company immediately prior to the
	Capital Reorganisation becoming effective
"Group"	the Company and its subsidiaries
"HKSCC"	Hong Kong Securities Clearing Company Limited
"Hong Kong"	Hong Kong Special Administrative Region of the PRC
"Independent Third	third party(ies) independent of the Company and any
Party(ies)"	connected person(s) of the Company and not a connected
	person of the Company
"Last Trading Day"	27 April 2021, being the last full trading day before the
	release of this announcement
"Latest Acceptance Date"	Friday, 9 July 2021
"Latest Time for Acceptance"	4:00 p.m. on Friday, 9 July 2021

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"Listing Committee"	has the same meaning ascribed thereto under the Listing
	Rules
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock
	Exchange
"Long Stop Date"	30 July 2021, or such later date as may be agreed between
	the Company and the Placing Agent in writing
"Net Gain"	the aggregate of any premiums (being the aggregate amount
	paid by the placees after deducting the aggregate amount of
	the placing price for the Unsubscribed Rights Shares placed
	by the Placing Agent and the placing commission payable to
	the Placing Agent under the Placing Agreement) under the
	Compensatory Arrangement
"No Action Shareholder(s)"	Qualifying Shareholders who do not subscribe for the
	Rights Shares (whether partially or fully) under the PALs or
	their renouncees, or such persons who hold any nil-paid
	rights at the time such nil-paid rights are lapsed, or
	Non-Qualifying Shareholders (as the case may be)
"Non-Qualifying	Overseas Shareholder(s) whom the Directors, after making
Shareholder(s)"	enquiries regarding the legal restrictions under the laws of
	the relevant places or the requirements of the relevant
	overseas regulatory bodies or stock exchanges, consider it
	necessary or expedient to exclude them from the Rights
	Issue
"Overseas Letter"	a letter from the Company to the Non-Qualifying
	Shareholder(s) (if any) explaining the circumstances in
	which the Non-Qualifying Shareholder(s) (if any) is/are not
	permitted to participate in the Rights Issue
"Overseas Shareholder(s)"	the Shareholder(s) (whose names appear on the register of
	members of the Company at the close of business on the
	Record Date) with registered address(es) outside Hong
	Kong

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"PAL(s)"	the provisional allotment letter(s) to be issued to the
	Qualifying Shareholders in connection with the Rights Issue
"Placing Agent"	Morton Securities Limited, a licensed corporation to carry
	out types 1 (dealing in securities) regulated activities under
	the Securities and Futures Ordinance (Cap 571 of the Laws
	of Hong Kong), and appointed by the Company to place any
	Unsubscribed Rights Shares under the Compensatory
	Arrangement as required under Rule 7.21(1)(b) of the
	Listing Rules
"Placing Agreement"	the placing agreement dated 28 April 2021 entered into
	between the Company and the Placing Agent in relation to
	the Compensatory Arrangement
"Prospectus"	the prospectus to be issued to the Shareholders containing,
	among other things, details of the Rights Issue
"Prospectus Documents"	the Prospectus and the PAL
"Prospectus Posting Date"	Thursday, 24 June 2021 or such other date as the Company
	may determine, being the date on which the Prospectus
	Documents are posted to the Qualifying Shareholders
"Qualifying Shareholder(s)"	Shareholders, other than the Non-Qualifying Shareholders,
	whose names appear on the register of members of the
	Company at the close of business on the Record Date
"Record Date"	Wednesday, 23 June 2021, or on such other date as the
	Company may determine, being the date by reference to
	which the Shareholders' entitlements to the Rights Issue are
	to be determined
"Registrar"	Boardroom Share Registrars (HK) Limited, the Hong Kong
	branch share registrar and transfer office of the Company

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"Rights Issue"	the issue by way of rights of one (1) Rights Share for every
	two (2) Adjusted Shares in issue on the Record Date at the
	Subscription Price
"Rights Shares"	up to 164,053,835 new Adjusted Shares proposed to be
	allotted and issued under the Rights Issue (assuming new
	Shares are issued on or before the Record Date and
	assuming full subscription under the Rights Issue)
"SGM"	the special general meeting of the Company to be convened
	for the purpose of considering and, if thought fit, approving
	the Capital Reorganisation by the Shareholders
"Share(s)"	the Existing Share(s) and/or the Adjusted Share(s), as the
	case may be
"Share Consolidation"	the consolidation of every ten (10) issued and unissued
	Existing Shares of a par value of HK$0.10 each in the share
	capital of the Company into one (1) Consolidated Share of a
	par value of HK$1.00 each in the share capital of the
	Company
"Share Premium Account"	the share premium account of the Company
"Share Premium Reduction"	the proposed reduction of the entire amount standing to the
	credit of the Share Premium Account of the Company to nil
"Shareholder(s)"	the holder(s) of the Existing Share(s) or the Adjusted
	Share(s)
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Subscription Price"	HK$0.42 per Rights Share
"Takeovers Code"	The Hong Kong Code on Takeovers and Mergers
"Unsubscribed Rights	consist of (i) the Rights Shares that are not subscribed by the
Shares"	Qualifying Shareholders or holders of nil-paid rights; and
	(ii) the unsold entitlement of the Non-Qualifying
	Shareholders to the Rights Shares

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"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"%"	per cent.
	By order of the board
	Sandmartin International Holdings Limited
	Lau Yau Cheung
	Chairman
Hong Kong, 28 April 2021

As at the date of this announcement, the directors of the Company are:

Executive Directors

Mr. Hung Tsung Chin and Mr. Chen Wei Chun

Non-Executive Director

Mr. Kuo Jen Hao

Independent Non-Executive Directors

Mr. Lau Yau Cheung (Chairman), Mr. Li Chak Hung and Mr. Wu Chia Ming

• For identification purpose only

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