09:17 UNITY INV HOLD<00913> - Announcement & Resumption (2) of the Company amounted to about HK$17,868,804 and as at 30 June 2004, the unaudited accumulated losses of the Company amounted to about HK$28,575,037. At present, the authorised share capital of the Company is HK$40,000,000 divided into 400,000,000 Shares, and its issued share capital is HK$38,400,000.50 divided into 384,000,005 Shares. After the Capital Reorganisation becoming effective, the Company's authorised share capital will become HK$500,000,000 divided into 50,000,000,000 New Shares, and its issued share capital will be HK$3,840,000.05 divided into 384,000,005 New Shares. As at the date hereof, the Company does not have any outstanding options, warrants or other convertible securities. Conditions of the Capital Reorganisation The Capital Reorganisation is subject to the following conditions being fulfilled:- (a) the approval by the Shareholders by way of special and ordinary resolutions at the EGM; (b) compliance with any conditions which the Court may impose; (c) the confirmation of the Capital Reduction by the Court and the registration by the Registrar of Companies in the Cayman Islands of a copy of the Court order and the minute containing the particulars required under the Companies Law; and (d) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the New Shares. Upon the conditions mentioned above being fulfilled, the Capital Reorganisation will become effective. Further announcement will be made by the Company to inform the Shareholders of the effective date of the Capital Reorganisation. Financial effects of, and reasons for, the Capital Reorganisation Save for the expenses to be incurred in relation to the Capital Reorganisation, the Capital Reorganisation will not, by itself, have any effect on the underlying assets, business operations, management or financial positions of the Company and of the Group, nor the proportionate interests of the Shareholders in the Company. For most of the trading days during the past 3 months, the Shares have been traded below their existing par value of HK$0.10. Under the Cayman Islands law, it is not possible for the Company to issue new Shares at a discount to the par value without the sanction of the Court. As such, the present situation creates impediments for the Company in pricing new issue of shares or other securities in the equity market to raise funding for the Group as and when suitable opportunities arise. It is expected that the Capital Reduction will afford greater flexibility to the Company in that regard by lowering the par value of the shares of the Company to below the current trading prices. As such, the Directors consider that the Capital Reorganisation is in the interest of the Company and the Shareholders as a whole. The Company does not currently have any plans to raise new capital. The Company will issue further announcement in that regard as and when required under the Listing Rules. B. FREE EXCHANGE OF CERTIFICATES Shareholders may submit certificates for the Shares to the branch share registrar of the Company in Hong Kong, namely, Tengis Limited of 28th Floor, BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong for exchange, at the expenses of the Company during a certain period after the Capital Reorganisation has become effective. After the expiry of such period, existing certificates for the Shares will be accepted for exchange only on payment of a fee. Existing certificates for the Shares will then cease to be good for delivery but will continue to be good evidence of legal title to the New Shares. Details of such exchange arrangements will be set out in the Circular. C. REFRESHMENT OF SHARE OPTION MANDATE LIMIT The Board also wishes to take this opportunity to seek the approval of the Shareholders to refresh the Scheme Mandate Limit, following the completion of the Rights Issue. Under the existing Scheme Mandate Limit, Directors were only authorised