10:46 MELCO INT'L DEV<00200> - Announcement & Resumption (7) Changes to the shareholding structure of Melco as a result of the issue of the Consideration Shares Issued Shares as at the date of this announcement Upon conversion of the First Convertible Bond in full Upon conversion of the Second Convertible Bond in full Upon allotment and issue of the Consideration Shares Upon conversion of the Convertible Bonds in full and allotment and issue of the Consideration Shares Number of Shares % Number of Shares % Number of Shares % Number of Shares % Number of Shares % Better Joy (Note a) 124,701,087 26.68 124,701,087 25.33 124,701,087 26.30 124,701,087 26.06 124,701,087 24.44 Mr. Lawrence Ho (Note b) 59,570,818 12.75 59,570,818 12.10 59,570,818 12.56 59,570,818 12.45 59,570,818 11.67 Shun Tak Shipping Company Limited (Note c) 39,083,147 8.36 39,083,147 7.94 39,083,147 8.24 39,083,147 8.17 39,083,147 7.66 Dr. Stanley Ho (Note d) 15,023,867 3.21 15,023,867 3.05 15,023,867 3.17 15,023,867 3.14 15,023,867 2.94 Madam Lucina Laam King Ying 222,287 0.05 222,287 0.05 222,287 0.05 222,287 0.05 222,287 0.04 STDM (Note e) - - 25,000,000 5.08 6,829,268 1.44 11,111,111 2.32 42,940,379 8.41 Others (Public) 228,780,848 48.95 228,780,848 46.46 228,780,848 48.24 228,780,848 47.81 228,780,848 44.83 -------------------------------------------------------- Total 467,382,054 100.00 492,382,054 100.00 474,211,322 100.00 478,493,165 100.00 510,322,433 100.00 ======================================================== Notes: a. Better Joy is owned as to 77% by Mr. Lawrence Ho and as to 23% by Dr. Stanley Ho. b. Interest of Mr. Lawrence Ho includes his personal interest and interest held through Lasting Legend, a company controlled and wholly owned by him. c. Interest of Shun Tak Shipping Company Limited includes interest held by itself and its wholly-owned subsidiaries. d. Interest of Dr. Stanley Ho includes his personal interest and interest held through two companies controlled and wholly-owned by him, namely, Sharikat Investments Limited and Dareset Limited. e. The First Convertible Bond and the Second Convertible Bond have respectively been issued by Melco to STDM on 9 November 2004 and 8 February 2005 pursuant to the First Agreement and Second Agreement respectively. Upon full conversion of the respective First Convertible Bond and the Second Convertible Bond, there will be an additional 25,000,000 Shares and 6,829,268 Shares respectively in issue. As at the date of this announcement, STDM has not exercised any conversion rights attached to the First Convertible Bond or the Second Convertible Bond. THE GREAT WONDERS AGREEMENT Date : 17 March 2005 Parties : Melco, as vendor Melco Entertainment, as purchaser Interest to be injected into the JV Group : 30% equity interests in Great Wonders Consideration : HK$400 million in cash Term of payment : HK$ 400 million, payable upon completion provided that if the concession of the Land has not yet been granted on or before the relevant completion date, then half of the said consideration, namely, HK$200 million will be payable upon the actual date of grant of the concession of the Land by the Macau Government to Great Wonders. Basis of determination of the consideration The basis of determination of the consideration under the Great Wonders Agreement is consistent with the basis adopted under the Third Agreement and hence, the consideration of HK$400 million is identical with the amount of consideration payable by Melco to STDM under the Third Agreement. as a whole; or (ii) the occurrence of any local, national or international event or change (whether or not forming part of a series of events or changes occurring or continuing before and/or after the date hereof) of a political, military, financial, economic, currency (including a change in the system under which the value of the Hong Kong currency is linked to the currency of the United States of America) or other nature (whether or not sui generis with any of the foregoing), or in the nature of any local, national, international outbreak or escalation of hostilities or armed conflict, or affecting local securities market or the occurrence of any combination of circumstances which may, in the reasonable opinion of the Placing Agent, materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole or adversely prejudices the success of the Placing of the Shares by potential investor(s) or otherwise makes it inexpedient or inadvisable for the Company or the Placing Agent to proceed with the Placing; or (iii) any change in market conditions or combination of circumstances in Hong Kong (including without limitation suspension or material restriction on trading in securities) occurs which affect the success of the Placing (such success being the placing of the Shares to potential investor(s)) or otherwise in the sole and absolute opinion of the Placing Agent make it inexpedient or inadvisable or inappropriate for the Company or the Placing Agent to proceed with the Placing; or (iv) any change in the circumstances of the Company or any members of the Group which may adversely affect the prospect of the Group; or (v) any incidence which, in the absolute opinion of the Placing Agent, may cause the Placing unadvisable to process. The Directors are not aware of the occurrence of any of such events as at the date of this announcement. Completion Of The Placing The conditions set out in the Placing Agreement is expected to be fulfilled on or before 18 April 2005, or such later date as may be agreed by the Company and the Placing Agent and the completion of the Placing will be take place on or before the third Business Day after the Placing Agreement become unconditional. Reasons For The Placing The Directors considered various ways of raising funds and consider that the Placing represents an opportunity to raise capital for the Company while broadening the shareholder base and the capital base of the Company. In addition, according to the financial position as shown in the latest audited financial statements for the year ended 31 March 2004 included in the Company's 2004 annual report and the unaudited interim results for the six months ended 30 September 2004, the Directors consider that the Group's liquidity will be enhanced by the Placing as a result of the broadening of capital base of the Company and that the Placing is therefore in the interests of the Company and its Shareholders as a whole. Use Of Net Proceeds The net proceeds of about HK$30 million from the Placing will apply to satisfy the consideration and related expenses for the Proposed Acquisition. In the event, the Proposed Acquisition does not proceed or the net proceeds is not fully utilized to finance the Proposed Acquisition, the whole of the net proceeds or such unutilized portion will be retained for general working capital purpose to strengthen the capital base of the Group. Details of the Proposed Acquisition are set out in the announcements made by the Company dated 22 November 2004, 6 December 2004 and 3 February 2005, respectively. As at the date of this announcement, due diligence exercise has commenced. Shareholders and investors should note that the terms and conditions of the Proposed Acquisition have yet to be finalized and the Proposed Acquisition may or may not be consummated. The net proceeds raised per Share upon the completion of the Placing will be about HK$0.388 per Share. Further announcement will be made by the Company in respect of any further material development of the Proposed Acquisition. Effect On Shareholding Structure The existing shareholding structure of the Company and the shareholding structure of the Company upon issue of the Placing Shares are set out as below: