09:26     FOUR SEAS MER<00374> - Announcement (2)                             

    (b)   the differences between the book value of the net                   
    assets of the Subsidiaries, being the wholly-owned                        
    subsidiaries of the Target Company, as at 15 December 2004                
    and 15 May 2005.                                                          
                                                                              
    Pursuant to the Stock Purchase Agreement, any adjustments                 
    to the Consideration will be settled between the Company                  
    and the Seller by the end of June 2005.                                   
                                                                              
    The Stock Purchase Agreement was entered into after arm's                 
    length negotiations between the parties involved and based                
    on normal commercial terms, and having considered the book                
    value of the net assets of each of the Target Company,                    
    Restaurant Shiki and New Kondo after eliminating the                      
    inter-company balances and the share capital of Restaurant                
    Shiki and New Kondo. The adjustment to the Consideration                  
    will be determined with reference to the average amount of                
    the book value of the net assets of each of the Target Company,           
    Restaurant Shiki and New Kondo determined by accounting                   
    firms designated by the Company and the Seller,                           
    respectively. The Board considers the terms of the Stock                  
    Purchase Agreement are fair and reasonable and in the                     
    interests of the Group and its shareholders as a whole.                   
                                                                              
    Conditions of the Stock Purchase Agreement                                
    Completion will be conditional upon, amongst other things,                
    the obtaining by the Seller of all the relevant consents                  
    and/or approvals in relation to the corporate                             
    reorganisation proceeding of the Seller as may be required                
    in respect of the Acquisition from the relevant court in                  
    Japan, such consent and/or approval has already been                      
    obtained.                                                                 
                                                                              
    Termination of the Stock Purchase Agreement                               
    If the Stock Purchase Agreement is terminated due to                      
    unforeseen reasons set out therein, the deposit of                        
    JPY30,000,000 (without interest) will be refunded by the                  
    Seller to the Company provided that the payment of the                    
    remaining amount of JPY511,600,000 as part of the                         
    Consideration is yet to be made by the Company to the Seller,             
    being a time before the Completion. No long stop date has                 
    been specified in the Stock Purchase Agreement.                           
                                                                              
    If the Stock Purchase Agreement is terminated as a result                 
    of material breach of any provision of the Stock Purchase                 
    Agreement and such breach is not remedied within an agreed                
    period:                                                                   
                                                                              
    (a)   if the Stock Purchase Agreement is terminated by the                
    Company and the Seller is the defaulting party, the Seller                
    shall refund the deposit of JPY30,000,000 (without interest)              
    paid by the Company; and                                                  
                                                                              
    (b)   if the Stock Purchase Agreement is terminated by the                
    Seller and the Company is the defaulting party, the Seller                
    shall be entitled to forfeit the deposit of JPY30,000,000                 
    paid by the Company,                                                      
                                                                              
    provided that the payment of the remaining amount of                      
    JPY511,600,000 as part of the Consideration is yet to be                  
    made by the Company to the Seller, being a time before the                
    Completion.                                                               
                                                                              
    Additional information                                                    
    Pursuant to the terms of the Stock Purchase Agreement, the                
    Company and the Seller agreed that the Target Company will                
    waive the outstanding loan due and owing by IS East Company               
    Limited, being a fellow subsidiary of the Target Company,                 
    in an aggregate amount of HK$10,202,382.12. In determining                
    the Consideration, this waiver of the outstanding loan due                
    and owing by IS East Company Limited to the Target Company                
    has been considered and deducted from the book value of the               
    net assets of the Target Company.                                         
                                                                              
    Shareholding chart                                                        
    Set out below are the shareholding charts of the Target                   
    Group before and after Completion:-                                       
       Before Completion   After Completion