10:42     MAGNUM INT'L<00305>-Announcement&Resumption of Trading (11)         

    The Secured Promissory Note                                               
                                                                              
    The terms of the Secured Promissory Note were negotiated between the      
    Company and MGL on an arm's length basis and the principal terms of       
    which are summarised below:                                               
                                                                              
    Principal amount:   Balance Shareholder's Loan (being approximately       
    HK$65.8 million as at 8 April 2005)                                       
                                                                              
    Interest:   The Secured Promissory Note will carry an interest rate       
    equal to the Hong Kong Prime Rate per annum.                              
                                                                              
    Security:   (i)  Property Charges; and                                    
       (ii)  Share Mortgages                                                  
                                                                              
    Repayment:   MGL shall be entitled to demand in writing payment of        
    all or any part of the amounts outstanding (including the interest        
    accrued thereon) at any time after twelve months from the date of the     
    issuance of the Secured Promissory Note in its discretion, whereupon      
    all amounts demanded shall become due and payable on the third            
    Business Day after the written demand.                                    
                                                                              
    Early repayment:   In the event that MGL receives from the Company        
    the sum of HK$32 million (together with all interest accrued thereon)     
    for value on or before the date that falls within six months after        
    the date of issuance of the Secured Promissory Note, MGL will accept      
    the sum of HK$32 million (plus interest accrued thereon) as full and      
    final settlement of the entire sum due and owing under the Secured        
    Promissory Note (including interest accrued thereto).                     
                                                                              
    Default of payment:   In the event the Company defaults in the payment    
    of any sum due and payable under the Secured Promissory Note, the         
    Company shall pay default interest on such sum to MGL from the due        
    date to the date of actual payment in full calculated at the rate of      
    12% per annum, which shall accrue on a daily basis.                       
                                                                              
    The Secured Promissory Note will be issued upon the Compromise Deed       
    Completion.                                                               
                                                                              
    The Unsecured Promissory Note                                             
                                                                              
    The terms of the Unsecured Promissory Note were negotiated between        
    the Company and MGL on an arm's length basis and the principal terms      
    of which are summarised below:                                            
                                                                              
    Principal amount:   HK$15,600,000                                         
                                                                              
    Interest:   No interest will be charged on the Unsecured Promissory       
    Note                                                                      
                                                                              
    Security:   No security                                                   
                                                                              
    Repayment:   MGL shall be entitled to demand in writing payment of        
    all or any part of the amounts outstanding at any time after six months   
    from the date of issuance of the Unsecured Promissory Note in its         
    discretion, whereupon all amounts demanded shall become due and           
    payable on the third Business Day after the written demand.               
                                                                              
    Default of payment:   In the event the Company defaults in the payment    
    of any sum due and payable, the Company shall pay default interest        
    on such sum to MGL from the due date to the date of actual payment        
    in full calculated at the rate of 12% per annum, which shall accrue       
    on a daily basis.                                                         
                                                                              
    The Unsecured Promissory Note will be issued upon Compromise Deed         
    Completion.                                                               
                                                                              
    Conditions of the Compromise Deed                                         
                                                                              
    The Compromise Deed is conditional upon the following conditions          
    being fulfilled:                                                          
                                                                              
    (i)  the grant by the Executive of his consent pursuant to Note 4 to      
    Rule 25 of the Takeovers Code in relation to the arrangements             
    contemplated by the Compromise Deed for the repayment of the              
    Shareholder's Loan;                                                       
                                                                              
    (ii)  the passing by the Independent Shareholders (by way of a poll)      
    of an ordinary resolution at the SGM to be convened for the purpose       
    of approving the transactions contemplated by the Compromise              
    Documents convened in accordance with the requirements of the Listing     
    Rules and the Company's Bye-laws;