09:29 U-RIGHT INT'L<00627> - Announcement & Resumption (9) Shares pursuant to the Underwriting Agreement, ACE and its concert parties will increase their aggregate shareholding from approximately 35.96% of the existing issued share capital of the Company to approximately 57.18% of the issued share capital of the Company as enlarged by the issue of Offer Shares (assuming all the outstanding Warrants have been exercised before the Record Date and the completion of the Open Offer). Under Rule 26 of the Takeovers Code, ACE and its concert parties, including Mr. Leung, will be required to make an unconditional mandatory general offer for all the issued Shares not already owned or agreed to be acquired by ACE or Mr. Leung or their concert parties. An application will be made by the ACE to the Executive for the Whitewash Waiver, which, if granted, would be subject to the approval of the Independent Shareholders on a vote taken by way of a poll. If the Whitewash Waiver is granted and approved by the Independent Shareholders, the obligation of ACE and its concert parties, including Mr. Leung to make an unconditional mandatory offer under Rule 26 of the Takeovers Code, will be waived. The Executive may or may not grant the Whitewash Waiver. Completion of Open Offer is conditional upon, among other things, the granting of the Whitewash Waiver by the Executive. Therefore, if the Whitewash Waiver is not obtained, the Open Offer will be lapsed and the Open Offer will not proceed. Neither ACE nor its concert parties have dealt in Shares for the past six months before the date of the Underwriting Agreement save for Mr. Leung Shing, an executive Director who is a brother of Mr. Leung, has sold 6,508,000 Shares and 6,292,000 Shares on 25 February 2005 and 28 February 2005, respectively. Reference was made to the Company's announcement dated 28 February 2005. GENERAL The Whitewash Waiver is subject to, among other things, the approval of the Independent Shareholders on a vote taken by way of a poll. An independent board committee will be established to make recommendations to the Independent Shareholders in relation to the Whitewash Waiver and an independent financial adviser will be appointed to advise the independent board committee and the Independent Shareholders in relation to the Whitewash Waiver. A circular containing, among other things, details of (i) the increase in authorised share capital of the Company; (ii) the Open Offer; and (iii) the Whitewash Waiver, the recommendations of the independent board committee of the Company in relation to the Whitewash Waiver and a letter of advice from the independent financial adviser to the independent board committee and the Independent Shareholders in relation to the Whitewash Waiver a and a notice convening the SGM, will be despatched to the Shareholders within 21 days from the date of publication of this announcement. Shareholders should note that the completion of the Underwriting Agreement is conditional and may or may not proceed. Shareholders and potential investors should exercise caution when dealing in the Shares. SUSPENSION AND RESUMPTION OF TRADING At the request of the Company, trading in Shares on the Stock Exchange has been suspended from 9:30 a.m. on Friday, 13 May 2005 pending the release of this announcement. Application has been made by the Company to the Stock Exchange for resumption of trading in Shares on the Stock Exchange with effect from 9:30 a.m. on Tuesday, 24 May 2005. DEFINITIONS "ACE" or "the Underwriter" ACE Target Inc., is a company incorporated in the British Virgin Islands with limited liability, and the issued share capital of which is beneficially owned by Mr. Leung as to 50% and Ms. Yim Yuk Lam, spouse of Mr. Leung, as to 50% and is the trustee of The Target Unit Trust "Application Form(s)" the application form(s) for use by the Qualifying Holders to apply for the Offer Shares in relation to their respective entitlements "associates" has the meaning ascribed thereto in the Listing Rules "Board" the board of Directors "Business Day" a day, other than Saturday, on which banks in Hong Kong are open for business "Company" U-RIGHT International Holdings Limited, a company incorporated in Bermuda with limited liability, the issued Shares of which are listed on the main board of the Stock Exchange