10:43     MAGNUM INT'L<00305>-Announcement&Resumption of Trading (14)         

    The Convertible Bond                                                      
                                                                              
    The terms of the Convertible Bond were negotiated between the Company     
    and Unichina on an arm's length basis and the principal terms of which    
    are summarised below:                                                     
                                                                              
    Principal amount:   HK$35,000,000                                         
                                                                              
    Interest:   1% per annum on the principal amount outstanding from         
    time to time, payable annually in arrear.                                 
                                                                              
    Maturity:   The Company shall repay the principal amount outstanding      
    under the Convertible Bond to the Bondholder(s) on the day which is       
    three years from the date of issue of the Convertible Bond.               
                                                                              
    Conversion price:   HK$0.04735 per new share of the Company, which        
    was arrived at after arm's length negotiation between the Company and     
    Unichina and is equivalent to the share offer price under the Share       
    Offer.                                                                    
                                                                              
    The conversion price of the Convertible Bond is subject to adjustment     
    provisions which are standard terms for convertible securities of         
    similar type. The adjustment events will arise as a result of certain     
    change in the share capital of the Company including consolidation        
    or sub-division of shares, capitalisation of profits or reserves,         
    capital distributions in cash or specie or subsequent issue of            
    securities in the Company.                                                
                                                                              
    If the Company determines that any adjustment to the conversion price     
    of the Convertible Bond should be made as a result of one or more events  
    or circumstances other than those mentioned above or mentioned in the     
    conditions of the Convertible Bond, the Company shall request the         
    Company's auditors to determine as to what adjustment (if any) to the     
    conversion price is fair and reasonable to take account thereof and       
    the date on which such adjustment should take effect and upon such        
    determination such adjustment shall be made and shall take effect in      
    accordance with such determination.  The Company will comply with the     
    disclosure requirement under the Listing Rules should there be any        
    adjustment of the conversion price of the Convertible Bond.               
                                                                              
    Conversion Shares:   Assuming exercise in full of the conversion          
    rights attaching to the Convertible Bond at the conversion price of       
    HK$0.04735 per Share, a total number of 739,176,346 Shares will be        
    issued, which represents approximately 120.2% and 54.6% of the Shares     
    in issue as at the date of this announcement and the total number of      
    issued Shares as enlarged by the issuance of the Conversion Shares        
    respectively.                                                             
                                                                              
    Conversion period:   The Bondholder(s) will have the right to convert     
    the whole or part (in an amount or integral multiple of HK$1,000,000)     
    of the outstanding principal amount of the Convertible Bond into new      
    Shares at any time and from time to time following the date of issue      
    of the Convertible Bond up to the third anniversary of the issue of       
    the Convertible Bond in amounts of not less than HK$1,000,000 on each     
    conversion, save that if at any time, the principal outstanding amount    
    of the Convertible Bond is less than HK$1,000,000, the whole (but not     
    part only) of the principal amount of the Convertible Bond may be         
    converted.                                                                
                                                                              
    Redemption:   The outstanding amount under the Convertible Bond may       
    be repaid or redeemed by the Company.                                     
                                                                              
    Ranking of the Conversion Shares:   Shares to be issued upon              
    conversion shall rank pari passu in all respects with all other           
    existing Shares outstanding at the date of the conversion notice and      
    be entitled to all dividends and other distributions the record date      
    of which falls on a date on or after the date of the conversion notice.   
                                                                              
    Transferability:   The Convertible Bond may be freely transferable        
    subject to compliance with all applicable laws and regulations.           
                                                                              
    Voting:   The Bondholder(s) will not be entitled to attend or vote        
    at any meeting of the Company by reason of being the Bondholder(s).       
                                                                              
    Listing:   No application will be made for the listing of the             
    Convertible Bond on the Stock Exchange. An application will be made       
    to the Stock Exchange for the listing of the Conversion Shares to be      
    issued on exercise of the conversion rights attaching to the              
    Convertible Bond.