09:30     MAGICIAN IND<00526>-Announcement & Resumption of Trading(3)         

    3.   Termination of existing service agreements with                      
    directors                                                                 
    The existing service agreement between the Company and                    
    Mr. Kong in relation to his position as chief executive                   
    officer and executive director of the Company has been                    
    terminated with immediate effect from 10 December 2004                    
    in accordance with the terms of the service agreement.                    
    As a result, Mr. Kong was also redesignated by the Board                  
    as a non-executive director with effect from 10                           
    December 2004. The Board had terminated Mr. Kong's                        
    service agreement due to disagreements in relation to                     
    his management of the Group.                                              
                                                                              
    The existing service agreement between the Company and                    
    Mr. Ku Ling Yu, John ("Mr. Ku"), previously an                            
    executive director, has been terminated with effect                       
    from 10 December 2004 by payment, in lieu of notice,                      
    of approximately HK$780,000, HK$600,000 of which                          
    being the equivalent of six months remuneration and                       
    the balance being other sums relating to his                              
    remuneration payable in accordance with the terms of                      
    the service agreement. As a result, Mr. John Ku was                       
    also redesignated by the Board from being an executive                    
    director to a non-executive director with effect from                     
    10 December 2004. The Board had terminated Mr. Ku's                       
    service agreement as it considered that Mr. Ku had not                    
    devoted sufficient management time to the affairs of                      
    the Group.                                                                
                                                                              
    4.   Changes in Board Composition                                         
    The position of each of Mr. Kong and Mr. Ku has been                      
    redesignated as non-executive director of the Company                     
    with effect from 10 December 2004. It was resolved at                     
    the Board meeting on 10 December 2004 that Mr. Kenneth                    
    Chan Chun Hing ("Mr. Chan") (subject to his consent                       
    to act) be proposed to be redesignated as executive                       
    director of the Company with effect from 10 December                      
    2004. However, at the Board meeting on 23 December 2004,                  
    Mr. Chan had declined to accept the proposed                              
    redesignation and remains as a non-executive director                     
    of the Company. As a result, the executive                                
    directorships of Mr. Kong and Mr. Ku were replaced by                     
    the appointment of Mr. Zee.                                               
                                                                              
    Mr. Zee was nominated by Mr. Hoon and it was resolved                     
    at the Board meeting on 10 December 2004 that Mr. Zee                     
    be appointed as a director of the Company and has been                    
    designated as an executive director of the Company                        
    with effect from 14 January 2005. In addition, it was                     
    resolved at the Board meeting on 10 December 2004 that                    
    Mr. Zee be appointed as a director of the following                       
    subsidiaries of the Company: Magician Industrial                          
    Company Limited, Grandmate Industrial Company Limited,                    
    Falton Investment Limited, Diyon Development Limited,                     
    More Concept Limited, Nicole (China) Company Limited,                     
    Magician (China) Company Limited, South Easy Limited,                     
    Treasure Trend Development Limited, Magician                              
    Investment (BVI) Limited and Hopeward Holdings                            
    Limited.