Hao Tian Development : (1) CONNECTED TRANSACTION IN RELATION TO SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE AND (2) NOTICE OF EXTRAORDINARY GENERAL MEETING

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Hao Tian Development Group Limited, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss however arising from or in reliance upon the whole or any part of the contents of this circular.

This circular appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of the Company.

昊天發展集團有限公司

Hao Tian Development Group Limited

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 00474)

(1) CONNECTED TRANSACTION IN RELATION TO SUBSCRIPTION OF

NEW SHARES UNDER SPECIFIC MANDATE

AND

(2) NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and

the Independent Shareholders

Capitalised terms used in this cover page shall have the same meaning as those defined in the section headed ''Definitions'' of this circular.

A letter from the Board is set out on pages 6 to 18 of this circular. A letter from the Independent Board Committee is set out on page 19 of this circular. A letter from Astrum Capital Management Limited containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 20 to 45 of this circular. A notice convening the EGM of the Company to be held at 10/F, CKK Commercial Centre, 289 Hennessy Road, Wanchai, Hong Kong on Friday, 18 September 2020, at 1:00 p.m. (or as soon thereafter as the extraordinary general meeting of the Company to be held at 12:30 p.m. on the same day and at the same place is concluded or adjourned) is set out on pages 56 to 58 of this circular.

A form of proxy for use at the EGM is enclosed. Such form of proxy is also published on the websites of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company (www.haotianhk.com).Whether or not you intend to attend and vote at the meeting or any adjourned meeting (as the case may be) in person, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon and return it to the branch share registrar and transfer office of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong as soon as possible, but in any event not less than 48 hours before the time appointed for holding such meeting or any adjourned meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or any adjourned meeting (as the case may be) should you so wish.

PRECAUTIONARY MEASURES FOR THE EXTRAORDINARY GENERAL MEETING

To safeguard the health and safety of Shareholders and prevent the spread of the coronavirus (COVID-19) pandemic, the following measures will be implemented at the EGM:

• Each attendee will be required to undergo a mandatory body temperature check. Any person with a body temperature above 37.4 degrees Celsius, or who is exhibiting flu-like symptoms, will be denied entry into the EGM venue.
• Shareholders, proxies and other attendees are required to wear surgical face masks inside the EGM venue at all times, and maintain a safe distance between seats. Any person who does not comply with this requirement will be required to leave the EGM venue.
• No refreshments will be served at the EGM and there will be no corporate gifts.

The Company reminds all Shareholders that any person who is subject to any quarantine order prescribed by the Hong Kong Government will be denied entry into the EGM venue, in order to ensure the health and safety of all attendees at the EGM. Additionally, the Company reminds all Shareholders that physical attendance in person at the EGM is not necessary for the purpose of exercising voting rights and would like to encourage Shareholders to appoint the chairman of the EGM as their proxy to vote on the relevant resolutions at the EGM, instead of attending the EGM in person.

1 September 2020

	CONTENTS
		Page
Definitions . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Letter from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Appendix I	- General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	46
Appendix II - Procedures for poll voting and
	precautionary measures for the EGM . . . . . . . . . . . . . . . . . . . . . . . . .	54
Notice of Extraordinary General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	56

- i -

DEFINITIONS

In this circular, the following expressions have the following meanings unless the context requires otherwise:

''associate(s)''	has the same meaning as ascribed to it under the Listing
	Rules
''Board''	the board of Directors
''Business Day''	any day (other than Saturday, Sunday and public holidays)
	on which banks are generally open for business in Hong
	Kong
''Company''	Hao Tian Development Group Limited (昊天發展集團有限
	公司), a company incorporated in the Cayman Islands with
	limited liability, the shares of which are listed on the Main
	Board of the Stock Exchange (stock code: 474)
''connected person(s)''	has the same meaning as ascribed to it under the Listing
	Rules
''Director(s)''	the director(s) of the Company
''EGM''	the extraordinary general meeting of the Company to be
	held at 10/F, CKK Commercial Centre, 289 Hennessy
	Road, Wanchai, Hong Kong on Friday, 18 September 2020,
	at 1:00 p.m. (or as soon thereafter as the extraordinary
	general meeting of the Company to be held at 12:30 p.m.
	on the same day and at the same place is conclude or
	adjourned) to consider, and if thought fit, to approve (i) the
	Subscription as contemplated under the Subscription
	Agreement; (ii) the grant of the Specific Mandate to issue
	the Subscription Shares, the notice of which is set out on
	pages 56 to 58 of this circular, or any adjournment thereof
''EGM Notice''	the notice convening the EGM which is set out on pages 56
	to 58 of this circular
''General Mandate''	the general mandate granted by the Shareholders to the
	Directors at the annual general meeting of the Company to
	allot, issue and otherwise deal with securities of the
	Company not exceeding 20% of the total number of Shares
	in issue as at the date of meeting held on 18 September
	2019

- 1 -

	DEFINITIONS
''Group''	the Company and its subsidiaries
''Hong Kong''	the Hong Kong Special Administrative Region of the PRC
''HTICI''	Hao Tian International Construction Investment Group
	Limited, a company incorporated in the Cayman Islands
	with limited liability, whose shares are listed on the Main
	Board of the Stock Exchange (stock code: 1341)
''Independent Board Committee''	the independent board committee of the Company formed
	to advise the Independent Shareholders in respect of the
	Subscription Agreement and the transactions contemplated
	thereunder, comprising all independent non-executive
	Directors
''Independent Financial Adviser''	Astrum Capital Management Limited, a licensed
	corporation to carry out type 1 (dealing in securities), type
	2 (dealing in futures contracts), type 6 (advising on
	corporate finance) and type 9 (asset management)
	regulated activities under the SFO and the independent
	financial adviser to the Independent Board Committee and
	the Independent Shareholders in respect of the Subscription
''Independent Shareholders''	Shareholders of the Company other than (1) Ms. Li Shao
	Yu and her associates; and (2) those who are involved in,
	or interested in, the Subscription Agreement and the
	transactions contemplated thereunder
''Latest Practicable Date''	26 August 2020, being the latest practicable date prior to
	the printing of this circular for ascertaining certain
	information in this circular
''Listing Rules''	the Rules Governing the Listing of Securities on the Stock
	Exchange
''Placing''	the placement of a total of 400,000,000 Placing Shares
	pursuant to the terms of the Placing Agreement at the
	Placing Price
''Placing Agent''	Hao Tian International Securities Limited, a licensed
	corporation to carry on business in Type 1 (dealing in
	securities) regulated activity under the SFO

- 2 -

	DEFINITIONS
''Placing Agreement''	the placing agreement entered into between the Company
	and the Placing Agent dated 24 July 2020 in respect of the
	Placing
''Placing Price''	HK$0.25 per Placing Share
''Placing Share(s)''	400,000,000 new Shares placed under the Placing
''PRC'' or ''China''	the People's Republic of China which, for the purposes of
	this circular, excludes Hong Kong, the Macau Special
	Administrative Region of the PRC and Taiwan
''Promethera Biosciences''	Promethera Biosciences S.A./N.V, a company incorporated
	in Belgium
''SFO''	the Securities and Futures Ordinance, Chapter 571 of the
	laws of Hong Kong
''Share(s)''	share(s) of HK$0.01 each in the share capital of the
	Company
''Shareholder(s)''	holder(s) of the issued Share(s)
''Specific Mandate''	the specific mandate for the allotment and issue of the
	Subscription Shares, which is subject to the approval by
	the Independent Shareholders voting by way of poll at the
	EGM
''Stock Exchange''	the Stock Exchange of Hong Kong Limited
''Subscriber''	Team Success Venture Holdings Limited, a limited
	company incorporated in the British Virgin Islands and
	wholly-owned by Ms. Li Shao Yu, the controlling
	shareholder of the Company
''Subscription''	the proposed subscription of 200,000,000 Subscription
	Shares by the Subscriber at the Subscription Price pursuant
	to the Subscription Agreement
''Subscription Agreement''	the subscription agreement entered into between the
	Company and the Subscriber dated 24 July 2020 in respect
	of the Subscription
''Subscription Price''	HK$0.25 per Subscription Share

- 3 -

	DEFINITIONS
''Subscription Share(s)''	200,000,000 new Shares to be allotted and issued by the
	Company to the Subscriber under the Subscription
''substantial shareholder(s)''	has the same meaning as ascribed to it under the Listing
	Rules
''%''	per cent.

Certain figures set out in this circular have been subject to rounding adjustments. Accordingly, figures shown as the percentage equivalents may not be an arithmetic sum of such figures. Any discrepancy in any table between totals and sums of amounts listed in this circular is due to rounding.

- 4 -

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

- 5 -

LETTER FROM THE BOARD

昊天發展集團有限公司

Hao Tian Development Group Limited

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 00474)

Executive Directors:	Registered office:
Mr. Xu Haiying	Cricket Square
Dr. Zhiliang Ou, JP (Australia)	Hutchins Drive
Mr. Fok Chi Tak	P.O. Box 2681
	Grand Cayman KY1-1111
Non-executive Directors:	Cayman Islands
Dr. Wang Yu
Dr. Li Yao	Head office and principal place of
	business:
Independent non-executive Directors:	Rooms 2501-2509, 25th Floor
Mr. Chan Ming Sun, Jonathan	Shui On Centre
Mr. Lam Kwan Sing	6-8 Harbour Road, Wanchai
Mr. Lee Chi Hwa, Joshua	Hong Kong
	1 September 2020
To all Shareholders
Dear Sir or Madam,

1. CONNECTED TRANSACTION IN RELATION TO SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE

AND

(2) NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the announcement of the Company dated 24 July 2020 in relation to the placing of new Shares under General Mandate and the subscription for new Shares by the Subscriber under Specific Mandate which constitutes a connected transaction for the Company under Chapter 14A of the Listing Rules.

- 6 -

LETTER FROM THE BOARD

On 24 July 2020 (after trading hours), the Company entered into the Subscription Agreement with the Subscriber, pursuant to which the Subscriber has conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, 200,000,000 Subscription Shares at the Subscription Price of HK$0.25 for each Subscription Share. The Subscription Shares will be allotted and issued pursuant to the Specific Mandate. On the same date, the Company entered into the Placing Agreement with the Placing Agent for the Placing of, on best efforts basis, a maximum of 400,000,000 Placing Shares. Completion of the Placing took place on 14 August 2020. An aggregate of 400,000,000 Placing Shares have been successfully placed by the Placing Agent to not less than six independent professional, institutional and/or individual investors at the Placing Price of HK$0.25 per Placing Share pursuant to the terms and conditions of the Placing Agreement.

The purpose of this circular is to provide Shareholders with (i) further details of the Subscription; (ii) a letter from the Independent Board Committee in relation to the Subscription Agreement and the transactions contemplated thereunder; (iii) a letter of advice from the independent financial adviser in relation to the Subscription Agreement and the transactions contemplated thereunder; and (iv) a notice convening the EGM, at which the resolutions will be proposed to be considered and, if thought fit, approved.

THE SUBSCRIPTION

The Subscription Agreement

Below is a summary of the terms of the Subscription Agreement.

Date:	24 July 2020 (after trading hours)
Parties:	(1)	The Company
	(2)	The Subscriber

The Subscriber has conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, 200,000,000 Subscription Shares at the Subscription Price of HK$0.25 for each Subscription Share under the Subscription Agreement.

As at the date of the Subscription Agreement and the Latest Practicable Date, the Subscriber is wholly-owned by Ms. Li Shao Yu, a controlling shareholder of the Company, who together with her associates, holds 3,246,527,115 Shares, representing approximately 50.01% of the issued share capital of the Company as at the Latest Practicable Date. Hence, the Subscriber is a connected person of the Company.

- 7 -

LETTER FROM THE BOARD

Subscription Shares

The 200,000,000 Subscription Shares represent (i) approximately 3.08% of the existing issued share capital of the Company as at the date of the Subscription Agreement and the Latest Practicable Date; and (ii) approximately 2.99% of the issued share capital of the Company as enlarged by the Subscription.

Subscription Price

The Subscription Price is HK$0.25 per Subscription Share. The Subscription Price represents:

1. a discount of approximately 13.79% to the closing price of HK$0.29 per Share as quoted on the Stock Exchange on the date of the Subscription Agreement;
2. a discount of approximately 15.25% to the average closing price of HK$0.295 per Share as quoted on the Stock Exchange for the last five consecutive trading days immediately prior to the date of the Subscription Agreement; and
3. a discount of approximately 43.82% to the closing price of HK$0.445 per Share as quoted on the Stock Exchange on 26 August 2020, being the Latest Practicable Date.

The Subscription Price is HK$0.25 per Subscription Share. The Subscription Price is exclusive of transaction fees and levies.

The Subscription Price was determined with reference to the prevailing market price of the Shares and was negotiated on an arm's length basis between the Company and the Subscriber. The Directors (including the independent non-executive Directors whose opinions have been set out in the letter from the Independent Board Committee included in this circular) consider that the terms and conditions of the Subscription Agreement (including the Subscription Price), are fair and reasonable and the Subscription is in the interest of the Company and the Shareholders as a whole.

Rights of the Subscription Shares

The Subscription Shares will, upon allotment and issue, be free of all liens, charge and encumbrances, and together with all rights attaching thereto as at the date of the completion of the Subscription, including the right to receive all dividends or other distributions declared, made or paid on or after the date of completion of the Subscription. The Subscription Shares will rank pari passu in all respects with the Shares in issue on the completion date of the Subscription.

- 8 -

LETTER FROM THE BOARD

Specific Mandate to issue the Subscription Shares

The Subscription Shares will be allotted and issued pursuant to the Specific Mandate proposed to be sought from the Independent Shareholders at the EGM.

Conditions of the Subscription

The completion of the Subscription is conditional upon the satisfaction of the following conditions:

1. the passing by the Independent Shareholders at the EGM of all resolutions required under relevant laws and regulations, including but not limited to the Listing Rules, of the transactions contemplated under the Subscription Agreement, including without limitation to the specific mandate for the allotment and issue of the Subscription Shares; and
2. the granting of the approval by the Listing Committee of the Stock Exchange (either unconditionally or subject to conditions to which neither the Company nor the Subscriber objects) for the listing of and permission to deal in the Subscription Shares as contemplated under the Subscription Agreement.

In the event that the conditions are not fulfilled on or before 30 September 2020 (or such later date as may be agreed between the Company and the Subscriber), the obligations and liabilities of the Company and the Subscriber under the Subscription Agreement shall be null and void, and neither the Company nor the Subscriber shall have any claims against the other for costs, damages, compensation or otherwise.

Completion of the Subscription

Completion of the Subscription will take place within five Business Days after the date upon which the last of the conditions has been satisfied, or at such other time and/or date as may be agreed between the Company and the Subscriber in writing.

Application for Listing

An application will be made to the Stock Exchange for the listing of, and permission to deal in, the Subscription Shares on the Stock Exchange.

- 9 -

LETTER FROM THE BOARD

EFFECTS OF THE SUBSCRIPTION ON THE SHAREHOLDING STRUCTURE OF THE COMPANY

The shareholding structure of the Company before and after completion of the Subscription (assuming that there is no change in the share capital of the Company from the Latest Practicable Date to the completion of the Subscription, save for the issue of the Subscription Shares) will be as follows:

	As at the Latest			Immediately after completion of
Shareholder	Practicable Date			the Subscription
			Approximate			Approximate
	Number of Shares	%	Number of Shares	%
Ms. Li Shao Yu (note 1)	3,215,627,115			49.53	3,215,627,115		48.05
The Subscriber	30,900,000			0.48	230,900,000		3.45
	3,246,527,115			50.01	3,446,527,115		51.50
Century Golden Resources
Investment Co. Ltd.	800,000,000			12.32	800,000,000		11.96
Directors of the Company	64,539,912			1.00	64,539,912	0.96
Public
- Other	2,380,819,778			36.67	2,380,819,778		35.58
Total	6,491,886,805			100	6,691,886,805	100

Note:

1. Those Shares were held directly by Asia Link Capital Investment Holdings Limited (a company beneficially wholly-owned by Ms. Li Shao Yu) as to 3,084,816,773 Shares and by Ms. Li Shao Yu as to 130,810,342 Shares.

- 10 -

LETTER FROM THE BOARD

FUNDRAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Company has conducted the following fundraising activities in the past twelve months immediately preceding the Latest Practicable Date:

Date of			Intended use of
announcement	Event	Net proceeds	proceeds
24 July 2020	Placing of up to	HK$99,500,000	The proceeds from the
	400,000,000		Placing are intended
	Placing Shares		to be used for the
	at the Placing		purpose as set out
	Price of		in the paragraph
	HK$0.25 per		headed ''USE OF
	Placing Share		PROCEEDS''
			below.

Actual use of proceeds as at the Latest Practicable Date

Approximately 46% of the proceeds from the Placing has been utilized for subscription of convertible bonds of Promethera Biosciences and the balance will be used as intended.

The Directors consider that the Placing provides opportunities to raise further capital for the Company, whilst broadening the Shareholder base and the capital base of the Company.

Save as disclosed above, the Company has not carried out any capital raising activities in the 12 months immediately preceding the Latest Practicable Date.

REASONS FOR THE SUBSCRIPTION

The Company entered into the Subscription Agreement to raise new capital for the purposes stated in the paragraph headed ''Use of Proceeds'' below. The Directors consider that the Subscription is in line with the Company's development need and growth strategy. The Directors consider that the Subscription reflects the confidence and commitment of the controlling shareholder of the Company towards the long-term and sustainable development of the Company, and that the continuing support of the controlling shareholder of the Company is crucial to ensure the business stability and long-term development of the Group. The Directors (including the independent non-executive Directors whose opinions have been set out in the letter from the Independent Board Committee included in the circular) consider that the terms of the Subscription Agreement are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

The Directors have considered conducting a rights issue or open offer to allow all Shareholders to maintain their respective pro-rata shareholding in the Company and at the same time strengthening the capital base of the Company. However, taking into account the current challenging stock market sentiment, such fund raising exercises, in view of the fund raising size,

- 11 -

LETTER FROM THE BOARD

would be relatively more time-consuming, administratively burdensome and cost-ineffective. Conducting rights issue or open offer may incur (i) comparatively higher administrative costs, professional fees and other expenses due to the need to engage various service providers, such as reporting accountants, legal advisers, independent financial adviser, share registrar and financial printer; and (ii) underwriting commission in the range of approximately 1.0% to 4.0% in general with reference to recent pre-emptive fund raising activities by companies listed on the Stock Exchange. Moreover, rights issue or open offer may require a relatively longer time period, usually not less than two (2) to three (3) months, to complete in view of the relatively more stringent documentary requirements for pre-emptive issues such as preparation of the listing document, unaudited pro forma financial information to be included in the prospectus, application forms, share certificates, refund cheques, registration of the listing document and negotiation with the underwriter on the terms and conditions of the underwriting agreement. Given the existing challenging business environment, the Company considers that it is necessary to control the costs of fund raising as far as practicable. Subscription of new Shares by the Subscriber can provide higher certainty of successful funding with minimal transaction costs compared to pre-emptive equity fund raising.

The Directors considered that pre-emptive equity fund raising, such as rights issue and open offer, would be very difficult as the market demand for the Shares are minimal due to (i) the small capitalization of the Company; (ii) the low trading volume and relatively illiquidity of the Shares; (iii) the loss-making financial position of the Group; and (iv) the cautious investors' sentiment under the recent volatile market environment. During the 24 months preceding the date of the Subscription Agreement, (a) the average daily trading volume is less than approximately 0.05% as compared to the total number of issued Shares held by the public as at 23 July 2020 being the last trading day prior to the date of the Subscription Agreement, and (b) the daily trading amount is less than approximately HK$740,000 during the relevant period. As such, it is difficult to conduct a rights issue or open offer. Further, the outbreak of coronavirus disease 2019 (''COVID-19'') and the current economic conditions also have an adverse effect on the market sentiment, and after careful assessment, the Directors considered that a rights issue or open offer may not be suitable ways for fund raising.

In addition, the Directors have also considered debt financing to meet the Group's general working capital requirement. However, having considered the following factors, the Directors are of the view that the Subscription is more preferable over debt financing:

1. while the Company has initiated discussions with banks and financial institutions, it is difficult for the Company to obtain bank borrowings on commercially justifiable terms, or at all, for development of a new business for bioscience because these banks and institutions are cautious about investing in pre-revenue bioscience projects;
2. the Subscription can strengthen the capital base of the Company without burdening the Group with principal repayment, interests expenses and other potential stringent financing terms;

- 12 -

LETTER FROM THE BOARD

1. debt financing requires the Group to retain a portion of Group's cash balance for principal and interests repayment or comply with certain restrictive covenants or specific performance requirements, which may limit the Group's flexibility and capability to use cash for further business development and to timely capture business opportunities that may arise from time to time;
2. the Subscription and further debt financing are not mutually exclusive. The Group may have a better position to bargain for more favourable terms from debt financiers if the Group has a larger equity base after completion of the Subscription.

In light of the reasons set out above, the Directors considered that the terms of the Subscription, which have been negotiated on an arm's length basis in accordance with normal commercial terms, are fair and reasonable and in the interests of the Company and the Shareholders taken as a whole.

USE OF PROCEEDS

The estimated net proceeds from the Placing (after deducting all fees, costs and expenses properly incurred by the Company are expected to be approximately HK$99,500,000. The estimated net Placing Price, after deducting such fees, costs and expenses, is therefore approximately HK$0.249 per Placing Share.

The net proceeds from the Subscription are expected to be approximately HK$50,000,000. The estimated net Subscription Price is therefore approximately HK$0.25 per Subscription Share.

According to the plan of the Company, the net proceeds from the Placing and the Subscription after deducting all fees, costs and expenses shall be applied in the following manner:

HK$ million

(approximately)

1. Approximately 70% of the net proceeds to be used for the subscription of the convertible bonds to be issued by Promethera Biosciences S.A./N.V. and the contribution to the joint venture company to be established with Promethera Biosciences S.A./N.V.,

details of which are set out in the announcement of the Company
dated 13 July 2020	104.7

(b) Approximately 30% for the net proceeds to be used for other
investments in, and working capital related to, bioscience businesses	44.8
Total	149.5

- 13 -

LETTER FROM THE BOARD

Out of the total net proceeds of HK$149,500,000 from the Placing and the Subscription, a majority portion of the proceeds have been or will be used to settle the subscription for the convertible bonds issued by Promethera Biosciences and the remaining balance will be used as working capital as follows:

• approximately HK$15 million will be used to set up a new China operation in the second half of 2020, which will be supported by a chief medical officer and other supporting functions for the development of plans and studies for clinical trial(s) in China for HepaStem and the antibody assets, initiate and maintain discussions with the PRC authorities for the clinical trial(s), as well as exploring other investment or cooperation opportunities in China; and
• approximately HK$30 million will be used for the preparation and initial works relating to the clinical trial(s) of HepaStem and the antibody assets or other investments in bioscience businesses.

As at the Latest Practicable Date, the Company is still actively identifying other potential bioscience projects.

As disclosed in the latest financial statements of the Company as at 31 March 2020, the Company had cash in the aggregate sum of approximately HK$406 million on a consolidated basis, which included (i) approximately HK$220 million held in Hao Tian International Construction Investment Group Limited (stock code 1341); (ii) approximately HK$23 million held in Fujian Nuoqi Co., Ltd. (stock code 1353); (iii) approximately HK$20 million that was trust accounts (clients' monies); (iv) approximately HK$5 million was pledged and was classified as non-current which cannot be used within the next twelve months; and (v) approximately HK$41 million cash was held in a project company which owns investment properties in the United Kingdom and such cash has been reserved for complying with the covenants under the mortgage over the properties. Having consider the bank balances and cash of the Group amounted to approximately HK$97 million as of 31 March 2020, the Directors considered that it is prudent for the Company to maintain sufficient working capital to fund its operations and financial obligations of its existing business. Therefore, the Company would like to raise new funds through the Subscription for the investment in bioscience business as life science companies are enjoying strong investment momentum with the benefits from advances in technologies.

The Company

As at the Latest Practicable Date, the principal activities of the Group include: (i) money lending; (ii) securities investment; (iii) provision of commodities and securities brokerage service;

1. asset management; (v) property leasing; and (vi) rental and trading of construction machinery. The Company has expanded its business into bioscience industry through acquisitions and has been endeavouring in identifying and locating acquisition targets.

- 14 -

LETTER FROM THE BOARD

The Group has recently expanded into bioscience business to bring global life science assets and intellectual properties to be developed, distributed and commercialized in the Greater China Region and Southeast Asia. Our target life science assets include, but are not limited to, therapeutic, medical device and diagnostic technologies originated from overseas leading universities or top tier research driven companies, which will address significant unmet medical needs in the Greater China Region and Southeast Asia and possess substantial commercialization potential.

The Group has recently set up Aceso Life Science Holding Limited (''Aceso Life Science''), a non-wholly owned subsidiary of the Company and the Group's vehicle for the business of development, manufacture, sale and distribution of therapeutic and diagnostic assets in the Greater China and South East Asia. As a significant step of diversifying the business of the Group, Aceso Life Science has recently entered into a joint venture agreement and formed Aceso-Promethera Asia Company Limited (''Aceso-Promethera Asia'') with Promethera Biosciences, a Belgium- based global innovator in liver therapeutics. Aceso-Promethera Asia has the exclusive right to engage in the development, commercialisation, sale and distribution of cell-based and biological therapies for the treatment of liver diseases, autoimmune diseases and various types of cancer based on the applications and development of the intellectual property rights of Promethera Biosciences in the Greater China Region and Southeast Asia region. The products to be developed by Aceso-Promethera Asia include:

1. allogeneic ''off-the shelf'' liver derived cell therapy (HepaStem and H2Stem) for the treatment of UCD, ACLF, NASH and Coronavirus Disease 2019 (COVID-19);
2. antibody asset Atrosab and Atrosimab for the treatment of liver indications and other inflammatory autoimmune diseases; and
3. antibody asset Novotarg for the treatment of solid tumors.

Depends on the consultation results with the regulatory authorities and the development results that may be achieved in respect of the products by Promethera Biosciences, the Group may initiate development steps in China for HepaStem in ACLF, HepaStem in NASH and Atrosimab in Rheumatoid Arthritis in the second half of 2021 that may include (a) an expanded New Drug Application (NDA) that includes a China cohort of patients in Promethera Biosciences Phase 2b ACLF study; (b) an Investigational New Drug (IND) application for HepaStem's use in NASH; and (c) an Investigational New Drug (IND) application for the use of Atrosimab in Rheumatoid Arthritis as well as other indications.

Assuming there are positive responses from the regulatory authorities, the Group will proceed with the clinical development in the years to come but the actual development schedule may vary among the products and the resources available to the Group.

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LETTER FROM THE BOARD

The Subscriber

The Subscriber is incorporated in the British Virgin Islands on 8 October 2010 as an investment holding company. Ms. Li Shao Yu, the controlling shareholder of the Company is the sole director and sole shareholder of the Subscriber.

LISTING RULES IMPLICATIONS

As at the Latest Practicable Date, the Subscriber is wholly-owned by Ms. Li Shao Yu, a controlling shareholder of the Company, who together with her associates, holds 3,246,527,115 Shares, representing approximately 50.01% of the issued share capital of the Company as at the Latest Practicable Date. Hence, the Subscriber is a connected person of the Company, and the Subscription constitutes a connected transaction for the Company and is subject to the announcement, reporting and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

None of the Directors have a material interest in the transaction and therefore they are not required under the Listing Rules to abstain from voting on the relevant board resolution.

An Independent Board Committee has been formed to advise the Independent Shareholders in respect of the Subscription Agreement and the transactions contemplated thereunder.

Astrum Capital Management Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders on the terms of the Subscription Agreement. Your attention is drawn to the letter of from the Independent Financial Adviser set out on pages 20 to 45 of this circular.

EXTRAORDINARY GENERAL MEETING

The EGM Notice is set out on pages 56 to 58 of this circular for the purpose of considering and, if thought fit, passing the resolutions set out therein.

A form of proxy for the EGM enclosed herewith and such form of proxy is also published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.haotianhk.com). Whether or not you are able to attend the meeting in person, please complete and return the form of proxy in accordance with the instructions printed thereon to the branch share registrar and transfer office of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding of the meeting or any adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting at the meeting or any adjourned meeting (as the case may be) should you so wish.

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LETTER FROM THE BOARD

Shareholders who are involved in, or interested in the Subscription Agreement and the transactions contemplated thereunder, shall abstain from voting for the resolution approving the Subscription at the EGM. To the best knowledge, information and belief of the Directors, save for Ms. Li Shao Yu and her associates, no other Shareholder has a material interest in the Subscription Agreement would be required to abstain from voting for the resolution to be proposed at the EGM in respect of the Subscription Agreement and the transactions contemplated thereunder. As at the Latest Practicable Date, Ms. Li Shao Yu and her associates held an aggregate of 3,246,527,115 Shares, representing approximately 50.01% of the issued Shares.

CLOSURE OF REGISTER OF MEMBERS

In order to establish entitlements to attend and vote at the EGM, the register of members of the Company will be closed from Tuesday, 15 September 2020 to Friday, 18 September 2020, both days inclusive, during which period no transfer of Shares will be registered. All transfers of Shares accompanied by the relevant share certificates and properly completed transfer forms must be lodged with the branch share registrar of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, for registration no later than 4:30 p.m. on Monday, 14 September 2020.

VOTING BY POLL AT THE EGM

Pursuant to Rule 13.39 of the Listing Rules and article 66 of the Articles, any votes of the Shareholders at a general meeting must be taken by poll. An announcement on the poll results will be published after the EGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

Details of procedures for conducting a poll are set out in the Appendix II to this circular.

RECOMMENDATION

The Independent Board Committee comprising all the independent non-executive Directors was established to advise the Independent Shareholders on the Subscription. Having taken into account the terms of the Subscription Agreement, the information stated in the Letter from the Board and the Letter from the Independent Financial Adviser, the Independent Board Committee considers that the terms of the Subscription Agreement are fair and reasonable so far as the Independent Shareholders are concerned, and are in the interests of the Company and the Independent Shareholders as a whole. Accordingly, the Independent Board Committee recommends the Independent Shareholders to vote in favour of the resolutions to be proposed at the EGM to approve the Subscription Agreement and the transactions contemplated thereunder. Your attention is drawn to the letter of from the Independent Board Committee set out on page 19 of this circular.

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LETTER FROM THE BOARD

The Directors (including the independent non-executive Directors) consider that the terms of the Subscription Agreement are fair and reasonable so far as the Independent Shareholders are concerned and the Subscription is in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors (including the independent non-executive Directors) recommend the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the EGM to approve the Subscription Agreement and the transactions contemplated thereunder and the grant of the Specific Mandate to issue the Subscription Shares.

By order of the Board

Hao Tian Development Group Limited

Fok Chi Tak

Executive Director

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

昊天發展集團有限公司

Hao Tian Development Group Limited

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 00474)

1 September 2020

To the Independent Shareholders

Dear sir/madam,

CONNECTED TRANSACTION IN RELATION TO SUBSCRIPTION OF

NEW SHARES UNDER SPECIFIC MANDATE

We refer to the circular of the Company dated 1 September 2020 (the ''Circular'') of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular.

We have been appointed by the Board to advise the Independent Shareholders on the Subscription Agreement. We wish to draw your attention to the letter from the Board set out on pages 6 to 18 of the Circular, and the letter of advice from the Independent Financial Adviser set out on pages 20 to 45 of the Circular, and the additional information set out in the appendices to the Circular.

Having considered the terms of the Subscription Agreement and the advice of the Independent Financial Adviser, we concur with the Independent Financial Adviser and consider that the terms of the Subscription Agreement are on normal commercial terms, not in the ordinary and usual course of business and are fair and reasonable so far as the Independent Shareholders are concerned, and the Subscription is in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the resolution to be proposed at the EGM to approve the Subscription Agreement and the transactions contemplated thereunder.

Yours faithfully,

For and on behalf of the

Independent Board Committee

Mr. Chan Ming Sun, Jonathan

Mr. Lam Kwan Sing

Mr. Lee Chi Hwa, Joshua

Independent non-executive Directors

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of a letter of advice from Astrum Capital Management Limited, the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the Subscription which have been prepared for the purpose of inclusion in this circular.

Room 2704, 27/F, Tower 1, Admiralty Centre,

18 Harcourt Road, Admiralty, Hong Kong

1 September 2020

To the Independent Board Committee and the Independent Shareholders of Hao Tian Development Group Limited

Dear Sirs,

CONNECTED TRANSACTION IN RELATION TO

SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE

INTRODUCTION

We refer to our engagement as the independent financial adviser to make recommendations to the independent board committee (the ''Independent Board Committee'') and the independent shareholders (the ''Independent Shareholders'') of Hao Tian Development Group Limited (the ''Company'') in relation to the subscription (the ''Subscription'') of 200,000,000 new shares of the Company (the ''Subscription Shares'') by Team Success Venture Holdings Limited (the ''Subscriber'') under specific mandate. The details of the Subscription were disclosed in the announcement of the Company dated 24 July 2020 (the ''Announcement'') and in the letter from the board (the ''Letter from the Board'') set out on pages 6 to 18 of the circular of the Company dated 1 September 2020 (the ''Circular'') to its Shareholders, of which this letter forms part. Terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

On 24 July 2020 (after trading hours), the Company entered into the Subscription Agreement with the Subscriber, pursuant to which the Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to allot and issue 200,000,000 Subscription Shares at the Subscription Price of HK$0.25 for each Subscription Share. The Subscription Shares will be allotted and issued pursuant to the Specific Mandate.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As at the Latest Practicable Date, the Subscriber was wholly-owned by Ms. Li Shao Yu (''Ms. Li''), a controlling shareholder of the Company, who together with her associates, held 3,246,527,115 Shares, representing approximately 50.01% of the issued share capital of the Company as at the Latest Practicable Date. Hence, the Subscriber is a connected person of the Company, and the Subscription constitutes a connected transaction for the Company and is subject to the announcement, reporting and independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

None of the Directors have a material interest in the transaction and therefore they are not required under the Listing Rules to abstain from voting on the relevant board resolution.

The EGM will be convened and held for the Independent Shareholders to consider and, if thought fit, approve the resolution in respect of the Subscription Agreement and the grant of the Specific Mandate by way of poll. Ms. Li and her associates and Shareholders who are involved in, or interested in the Subscription Agreement and the transactions contemplated thereunder, shall abstain from voting for the resolution to approve the Subscription at the EGM. To the best knowledge, information and belief of the Directors, save for Ms. Li and her associates, no other Shareholder has a material interest in the Subscription Agreement would be required to abstain from voting for the resolution to be proposed at the EGM in respect of the Subscription Agreement and the transactions contemplated thereunder. As at the Latest Practicable Date, Ms. Li and her associates held an aggregate of 3,246,527,115 Shares, representing approximately 50.01% of the issued Shares.

An Independent Board Committee, comprising all the independent non-executive Directors, namely Mr. Chan Ming Sun, Jonathan, Mr. Lam Kwan Sing and Mr. Lee Chi Hwa, Joshua, has been established to give recommendations to the Independent Shareholders as to whether the terms of the Subscription Agreement and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole, and as to voting in respect thereof at the EGM. We, Astrum Capital Management Limited, have been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

BASIS OF OUR OPINION

In formulating our opinion and recommendations, we have reviewed, inter alia, the Announcement, the Circular, the Subscription Agreement, the announcement of the Company dated 13 July 2020 (the ''APA JV Announcement'') in relation to, among other things, (a) the formation of a joint venture company (namely, Aceso-Promethera Asia Company Limited, ''Aceso-Promethera Asia'') by Aceso Life Science Holding Limited (a non-wholly owned subsidiary of the Company, formerly known as Genius Power Holding Limited, ''Aceso Life Science'') and Promethera Biosciences; and (b) the subscription of convertible bonds of Promethera Biosciences by the Company, and the annual reports of the Company for the financial years ended 31 March 2019 and 31 March 2020 (the ''2018/19 Annual Report'' and ''2019/20

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Annual Report'', respectively). We have also reviewed certain information provided by the management of the Company (the ''Management'') relating to the operations, financial condition and prospects of the Group. We have also (i) considered such other information, analysis and market data which we deemed relevant; and (ii) conducted verbal discussions with the Management regarding the terms of the Subscription Agreement, the businesses and future outlook of the Group. We have assumed that such information and statements, and any representation made to us, are true, accurate and complete in all material respects as of the date hereof and we have relied upon them in formulating our opinion.

All Directors collectively and individually accept full responsibility in providing information of the Company in the Announcement and the Circular and, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in the Announcement and the Circular is accurate and complete in all material respects and not misleading or deceptive, and that there are no other matters not contained in the Announcement and the Circular, the omission of which would make any statement herein or in the Announcement and the Circular misleading. We consider that we have performed all necessary steps to enable us to reach an informed view regarding the terms of, and the reasons for entering into, the Subscription Agreement and to justify our reliance on the information provided so as to provide a reasonable basis of our opinion. We have no reasons to suspect that any material information has been withheld by the Directors or the Management, or is misleading, untrue or inaccurate. We have not, however, for the purpose of this exercise, conducted any independent detailed investigation or audit into the businesses or affairs or future prospects of the Group. Our opinion is necessarily based on financial, economic, market and other conditions in effect, and the information made available to us, as at the Latest Practicable Date. This letter is issued to provide information for the Independent Board Committee and the Independent Shareholders solely in connection with their consideration of the entering into of the Subscription Agreement and the grant of the Specific Mandate. Except for the inclusion in the Circular, this letter should not be quoted or referred to, in whole or in part, nor shall it be used for any other purposes, without our prior written consent.

INDEPENDENCE DECLARATION

As at the Latest Practicable Date, we were not aware of any relationships or interests between Astrum Capital Management Limited, the Company, the Subscriber and/or any of their respective substantial shareholders, directors or chief executive, or any of their respective associates. In the last two years, there was no other engagement between the Group and Astrum Capital Management Limited. Apart from the normal advisory fees payable to us for the relevant engagement in relation to the Subscription and the grant of the Specific Mandate, no other arrangement exists whereby we will receive any fees and/or benefits from the Group. Accordingly, Astrum Capital Management Limited is independent as defined under Rule 13.84 of the Listing Rules to act as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in connection with the Subscription and the grant of the Specific Mandate.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our advice with regard to the entering into of the Subscription Agreement and the grant of the Specific Mandate, we have taken into consideration the following factors and reasons:

1. Information on the Group

According to the Letter from the Board, the principal activities of the Group include (i) money lending; (ii) securities investment; (iii) provision of commodities and securities brokerage service; (iv) asset management; (v) property leasing; and (vi) rental and trading of construction machinery. The Company intends to expand its businesses into bioscience industry through acquisitions and has been endeavouring in identifying and locating acquisition targets.

The table below summarises the audited consolidated financial results of the Group for the three years ended 31 March 2018, 2019 and 2020 (''FY2017/18'', ''FY2018/19'' and ''FY2019/20'', respectively) as extracted from the 2018/19 Annual Report and the 2019/20 Annual Report:

Table 1: Summary of the consolidated financial results of the Group

		FY2017/18	FY2018/19	FY2019/20
		(audited)	(audited)	(audited)
		HK$'000	HK$'000	HK$'000
Revenue	330,017	319,513	295,645
-	Money lending	118,006	73,459	74,969
- Provision of asset management,
	securities brokerage,
	commodities, futures and other
	financial services	11,524	15,540	18,636
- Construction machinery and sales
	of construction materials	165,869	162,409	137,755
- Retailing of men's and women's
	apparels	34,618	1,835	-
-	Property leasing	-	66,270	64,285
Gross profit	145,726	153,339	166,597
Loss before taxation	(538,391)	(480,577)	(267,228)
Loss for the year attributable to owners
	of the Company	(444,906)	(380,871)	(283,718)

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

	As at	As at	As at
	31 March	31 March	31 March
	2018	2019	2020
	(audited)	(audited)	(audited)
	HK$'000	HK$'000	HK$'000
Non-current assets	2,146,939	2,899,837	3,399,281
Current assets	2,882,572	2,654,668	1,634,003
Current (liabilities)	(1,254,811)	(892,034)	(1,049,341)
Net current assets	1,627,761	1,762,634	584,662
Non-current (liabilities)	(711,266)	(1,878,504)	(1,487,785)
Equity attributable to owners of the
Company	2,791,630	2,630,804	2,490,176

Source: the 2018/19 Annual Report and the 2019/20 Annual Report

1. For the year ended 31 March 2019 (i.e. FY2018/19)

In FY2018/19, the Group successfully tapped into the property investment and leasing business through the acquisition of the entire issued share capital of 55 Mark Lane S.À R.L. (the ''London Property Acquisition''), which is a company incorporated under the laws of the Grand Duchy of Luxembourg with limited liability and held a property in the City of London, United Kingdom (namely, 55 Mark Lane, EC3), at a consideration of approximately £128 million (equivalent to approximately HK$1,429.0 million). Such newly established business contributed revenue of approximately HK$66.3 million to the Group in FY2018/19, representing approximately 20.7% of the Group's total revenue. Please refer to the circular of the Company dated 23 March 2018 for further details of the London Property Acquisition.

In FY2018/19, the Group's total revenue amounted to approximately HK$319.5 million, representing a slight decrease of approximately 3.2% as compared to approximately HK$330.0 million in FY2017/18. Despite the slight decrease in revenue, the Group's gross profit increased by approximately 5.2% from approximately HK$145.7 million in FY2017/18 to approximately HK$153.3 million in FY2018/19, and the gross profit margin increased by approximately 3.8 percentage points from approximately 44.2% in FY2017/18 to approximately 48.0% in FY2018/19.

In FY2018/19, the Group recorded loss attributable to owners of the Company of approximately HK$380.9 million, representing a decrease of approximately 14.4% as compared to approximately HK$444.9 million in FY2017/18. Such improvement was mainly attributable to (i) the absence of impairment loss on goodwill in FY2018/19 (FY2017/18: approximately HK$316.3 million); (ii) the recognition of gain on disposal

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

of subsidiaries of approximately HK$57.3 million in FY2018/19 (FY2017/18: nil); (iii) the recognition of fair value gain on investment property of approximately HK$38.7 million in FY2018/19 (FY2017/18: nil); and (iv) the recognition of interest earned on financial assets at amortised cost of approximately HK$12.3 million (FY2017/18: nil), which was partially offset by (i) the increase in fair value loss on financial assets at fair value through profit and loss (''FVTPL'')/investments held for trading of approximately HK$251.0 million; (ii) the increase in finance costs of approximately HK$61.8 million; and (iii) the decrease in fair value gain on financial liabilities at FVTPL of approximately HK$39.7 million.

As at 31 March 2019, the Group's total assets and total liabilities amounted to approximately HK$5,554.5 million (31 March 2018: approximately HK$5,029.5 million) and approximately HK$2,770.5 million (31 March 2018: approximately HK$1,966.1 million), respectively. The equity attributable to owners of the Company decreased from approximately HK$2,791.6 million as at 31 March 2018 to approximately HK$2,630.8 million as at 31 March 2019. The decrease in equity was primarily due to loss attributable to owners of the Company of approximately HK$380.9 million in FY2018/19, which was partially offset by (i) the change in the Group's ownership interest in existing subsidiaries of approximately HK$85.2 million;

1. the deemed acquisition of interest in Hao Tian Finance Company Limited (''Hao Tian Finance'') of approximately HK$78.9 million; (iii) the issue of consideration Shares in respect of the acquisition of 49% issued share capital of Grand Peaceful Global Limited of approximately HK$78.1 million; and (iv) capital contribution from the controlling Shareholder of approximately HK$40.2 million.

1. For the year ended 31 March 2020 (i.e. FY2019/20)

In FY2019/20, the Group's total revenue amounted to approximately HK$295.6 million, representing a decrease of approximately 7.5% as compared to approximately HK$319.5 million in FY2018/19. Such decrease was mainly attributable to the decrease in revenue from the Group's construction machinery and sales of construction materials business from approximately HK$162.4 million in FY2018/19 to approximately HK$137.8 million in FY2019/20. Despite the decline in revenue, the Group's gross profit increased by approximately 8.6% from approximately HK$153.3 million in FY2018/19 to approximately HK$166.6 million in FY2019/20, and the gross profit margin increased by approximately 8.4 percentage points from approximately 48.0% in FY2018/19 to approximately 56.4% in FY2019/20.

In FY2019/20, the Group recorded loss attributable to owners of the Company of approximately HK$283.7 million, representing a decrease of approximately 25.5% as compared to approximately HK$380.9 million in FY2018/19. Such improvement was mainly attributable to (i) the reduction in fair value loss on financial assets at FVTPL of approximately HK$392.7 million; (ii) the increase in the fair value gain on

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

investment properties of approximately HK$101.2 million; and (iii) the recognition of forfeit of partial payment of consideration in respect of disposal of listed securities by the Group of approximately HK$78.4 million (FY2018/19: nil), which was partially offset by (i) the increase in expected credit loss on financial assets of approximately HK$268.2 million; and (ii) the recognition of impairment loss on goodwill of approximately HK$86.4 million (FY2018/19: nil); and (iii) the increase in finance cost of approximately HK$41.8 million.

As at 31 March 2020, the Group's total assets and total liabilities amounted to approximately HK$5,033.3 million (31 March 2019: approximately HK$5,554.5 million) and approximately HK$2,537.1 million (31 March 2019: approximately HK$2,770.5 million), respectively. The equity attributable to owners of the Company decreased from approximately HK$2,630.8 million as at 31 March 2019 to approximately HK$2,490.2 million as at 31 March 2020. The decrease in equity was primarily due to loss attributable to owners of the Company of approximately HK$283.7 million in FY2019/20, which was partially offset by the acquisition of non- controlling interest in Hao Tian Finance of approximately HK$130.3 million.

2. Background of and reasons for the entering into of the Subscription Agreement

As mentioned in the 2019/20 Annual Report, while the outbreak of Coronavirus pandemic (''COVID-19'') and possible escalation of the Sino-United States trade war which affect the pace of global economic recovery and the uncertainties in financial market, the Group will continue its strategy to build a diversified portfolio of businesses that can weather the uncertain market conditions and to explore investment opportunities with quality assets and potentials for income and capital value growth for the Shareholders and investors of the Company. The Group intends to expand its businesses into bioscience industry through acquisitions and by collaborating with life science companies over the world with the aim to bring global life science assets and intellectual properties to be developed, distributed and commercialised in the Greater China area and South East Asia. The Group has been endeavouring in identifying and locating acquisition targets.

On 5 June 2020, Success Destiny Limited (''Success Destiny''), a wholly-owned subsidiary of the Company, and Co-High Investment Management Limited (''Co-High'') entered into the subscription agreement and the shareholders' agreement (the ''ALS JV Agreements'') with Aceso Life Science (which was then wholly-owned by the Company as at the date of the ALS JV Agreements) for subscription of shares of Aceso Life Science. Pursuant to the ALS JV Agreements, each of Success Destiny and Co-High has agreed to subscribe for shares of Aceso Life Science, and upon completion, Aceso Life Science shall be owned by Success Destiny and Co-High as to 51% and 49%, respectively. Aceso Life Science will, being a joint venture vehicle, undertake the business of development, manufacture, sale and distribution of therapeutic and diagnostic assets in the Greater China

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

area and South East Asia. For further details of the ALS JV Agreements, please refer to the announcement of the Company dated 5 June 2020 (the ''ALS JV Announcement'') and the circular of the Company dated 14 August 2020.

On 13 July 2020, Aceso Life Science and Promethera Biosciences entered into a joint venture agreement (the ''APA JV Agreement'') for the formation of a joint venture vehicle (namely, Aceso-Promethera Asia). Pursuant to the APA JV Agreement, Aceso-Promethera Asia will have the exclusive right to engage in the development, commercialisation, sell and distribution of cell-based and biological therapies for the treatment of liver diseases, autoimmune diseases and various types of cancer based on the applications and development of the intellectual properties of Promethera Biosciences in the territories covering the certain jurisdictions in Asia as set out in the APA JV Agreement, including but not limited to the PRC, Hong Kong, and the Macau Special Administrative Region of the PRC. On the same day, the Company, Promethera Biosciences and other shareholders of Promethera Biosciences entered into a subscription and shareholders' agreement, pursuant to which, the Company has conditionally agreed to subscribe for, and Promethera Biosciences has conditionally agreed to issue, convertible bonds of Promethera Biosciences in the principal amount of up to Euro 10,000,000 (equivalent to approximately HK$87.6 million) in two equal tranches (the ''CB Subscription''). Upon full conversion of such convertible bonds, the Company will hold approximately 4.14% of the enlarged issued share capital of Promethera Biosciences. For further details of the APA JV Agreement and the CB Subscription, please refer to the APA JV Announcement.

The formation of the joint ventures (namely, Aceso Life Science and Aceso- Promethera Asia) as mentioned above is in line with the Group's development plan in broadening exposure in the healthcare sector and boosting the Group's competitiveness and innovation capability. Given the prevalence of liver diseases in the PRC, together with the increasing maturity and the increasing national support in the PRC with respect to the cell and regenerative medicine industry, the Management is of the view that the establishment of Aceso Life Science with Co-High and Aceso-Promethera Asia with Promethera Biosciences and the CB Subscription are beneficial to the Company.

In this regard, we have enquired the Management regarding the Group's development plan of its bioscience businesses and were given to understand that the Group plans to develop, distribute and commercialise the life science assets in the Greater China area and South East Asia and the first project will be using intellectual property rights contributed by Promethera Biosciences (including but not limited to three cell-based therapy products, i.e.

1. allogeneic ''off-the shelf'' liver derived cell therapy (HepaStem and H2Stem) for the treatment of Urea Cycle Disorder (''UCD''), Acute-on-Chronic Liver Failure (''ACLF''), Non-alcoholic Steatohepatitis (''NASH'') and COVID-19; (ii) antibody asset Atrosab and Atrosimab for the treatment of liver indications and other inflammatory autoimmune diseases; and (iii) antibody asset Novotarg for the treatment of solid tumors). In the second half of 2020, the Group will set up operations in the PRC for preparing clinical trials for

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

HepaStem and the antibody assets, initiating and maintaining discussions with the PRC authorities, as well as exploring other investment or cooperation opportunities. In addition to the existing management and expertise of Aceso Life Science and Aceso-Promethera Asia, the Group plans to recruit additional life science executives with relevant healthcare and bioscience experience and expertise to assist the Group in the development of its bioscience businesses. As advised by the Management, the Group expects to initiate development steps in the PRC for HepaStem in ACLF, HepaStem in NASH and Atrosimab in Rheumatoid Arthritis in the second half of 2021 that may include (i) an expanded New Drug Application that includes a China cohort of patients in Promethera Biosciences Phase 2b ACLF study;

1. an Investigational New Drug (''IND'') application for HepaStem's use in NASH; (iii) an IND application for the use of Atrosimab in Rheumatoid Arthritis as well as other indications. Subject to the relevant regulatory approvals to be granted by the PRC authorities, the Group expects to proceed with the relevant clinical trial(s) in the PRC.

On the other hand, the Group will keep identifying potential life science products from world leading life science ecosystems and continue expanding the line of potential products according to the business development and financial resources of the Group. The Management advised us that they have established a scientific advisory committee to select potential projects and provide technical supports from a scientific perspective towards any future opportunities for acquiring or licensing life science products. The Group will also collaborate with leading academic institutions, contract research organizations and third- party strategic partners around the world, which will help to streamline the development of the pipeline projects. In line with industry practice, part of the clinical studies and clinical supplies manufacturing may be outsourced to externally accredited contract research organizations or laboratories in order to speed up the clinical development process and attain the required studies for submission to the regulatory authorities. On 21 July 2020, Aceso Life Science and Promethera Biosciences entered into a memorandum of understanding (the ''MOU'') with Itochu Corporation (an established Japanese conglomerate with presence in the medical, healthcare and bioscience space, ''Itochu''). Pursuant to the MOU, Itochu and Aceso-Promethera Asia will enter into a novated and amended collaboration agreement in relation to the collaboration of a joint study on the therapeutic use of certain intellectual property rights contributed by Promethera Biosciences. Subject to satisfactory results and negotiation on the commercial terms on a case-by-case basis, the Group will collaborate with Itochu on distribution, licensing and sales of the products to be proceeded in Asia.

In respect of the working capital requirement of the Group's bioscience businesses, the Management advised us that (i) working capital in the sum of approximately HK$15 million will be used to set up a new China operation in the second half of 2020, which will be supported by a chief medical officer and other supporting functions; and (ii) working capital in the sum of approximately HK$30 million will be used for the preparation and initial works relating to the clinical trials for the HepaStem products and the antibody assets to be undergone in the PRC or other investments in bioscience businesses.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Furthermore, we have conducted a research on the liver diseases and biotech industry in the PRC through public domains. According to the statistics published by the World Health Organization, the number of new cases of liver cancer in the PRC was approximately 393,000 in 2018, and is expected to increase to approximately 464,000 in 2025, representing a compound annual growth rate of approximately 2.4%. Liver cancer ranked the fourth most common cancer types in PRC in term of the number of new cases of cancer in 2018 and the number of new cases of liver cancer in the PRC in 2018 accounted for approximately 47% of total number of new cases of liver cancer in the world. According to the China Biotech Primer issued by Goldman Sachs in November 2019, the market capitalisation of the biotech industry in the PRC recorded an annual growth of approximately 15% to approximately RMB40 billion in 2018 which, however, accounted for only approximately 8% of the market capitalisation of healthcare sector in the PRC as compared to that in the United States of approximately 14%. In recent years, the PRC government and the relevant authorities have promulgated and issued guidelines, measures and regulations on the biotech industry (including but not limited to (i)《關於深化審評審批制度改革鼓勵藥品醫療器械創新的意 見》(Opinions on Deepening the Reform of Examination and Approval System for Drugs and Enco ur ag in g I nn ov ati on of Dru g s an d Me d i c a l I n s t r u m e n t s * ) p r o m u l g a t e d on 8 October 2017; (ii)《關於鼓勵藥品創新實行優先審評審批的意見》(Opinions on Encouraging the Priority Examination and Approval for Drug Innovations*) promulgated on

21 December 2017; and (iii)《藥物研發與技術審評溝通交流管理辦法》(Administrative Measures for Communication on the Research, Development and Technical Examination of Drugs*) promulgated on 30 September 2018) so as to regulate the industry and promote proper development. Based on the above, it is believed that the biotech industry in the PRC will continue its growth in the coming future.

With an aim of meeting the capital requirements for the development and operation of the newly-established bioscience businesses and the CB Subscription, on 24 July 2020 (after trading hours), the Company entered into the Subscription Agreement with the Subscriber (a company wholly owned by Ms. Li, the controlling shareholder of the Company), pursuant to which the Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to allot and issue 200,000,000 Subscription Shares at the Subscription Price of HK$0.25 for each Subscription Share. The Subscription Shares will be allotted and issued pursuant to the Specific Mandate. On the same day, the Company entered into the Placing Agreement with the Placing Agent for the Placing of, on best efforts basis, a maximum of 400,000,000 Placing Shares. Completion of the Placing took place on 14 August 2020. An aggregate of 400,000,000 Placing Shares have been successfully placed by the Placing Agent to not less than six independent placees at the Placing Price of HK$0.25 per Placing Share pursuant to the terms and conditions of the Placing Agreement.

• For illustration purpose only

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As advised by the Management, the expected net proceeds from the Subscription of approximately HK$50.0 million, together with the net proceeds from the Placing of approximately HK$99.5 million, shall be applied for the development of the Group's bioscience businesses in the following manner:

1. approximately 70% of the aggregate net proceeds (i.e. approximately HK$104.7 million) to be used for the CB Subscription and the contribution to Aceso- Promethera Asia; and
2. approximately 30% for the aggregate net proceeds (i.e. approximately HK$44.8 million) to be used for other investments in, and working capital related to, bioscience businesses (in particular, the costs for setting up operations in the PRC, and preparation and initial works of the clinical trials to be undergone in the PRC).

As disclosed in 2019/20 Annual Report, the Group's net current assets as well as bank balances and cash amounted to approximately HK$584.7 million and approximately HK$381.7 million, respectively, as at 31 March 2020. We have enquired with the Management the reasons of not using the Group's internal resources for the investment and development of its bioscience businesses but conducting the Subscription and the Placing to raise additional fund. As advised by the Management, the bank balances and cash of the Group as at 30 June 2020 dropped to approximately HK$256.2 million, which was composed of, among others, (i) the cash balance of a non wholly-owned subsidiary of the Company (namely, Hao Tian International Construction Investment Group Limited, the shares of which are listed on Stock Exchange (stock code: 1341)) of approximately HK$92.3 million for its operations and development; (ii) the cash balance of the Group's subsidiaries in the PRC of approximately HK$41.5 million for maintaining their daily operation, and could only be transferred to countries and/or regions outside the PRC through burdensome and time-consuming administrative procedures; and (iii) the cash balance of a wholly-owned subsidiary of the Company (namely, 55 Mark Lane S.À R.L.) of approximately HK$41.2 million which has been reserved for complying with the covenants under the mortgage over the properties (collectively, the ''Designated Cash Balance''). Without taking into consideration the Designated Cash Balance of approximately HK$175.0 million, the remaining bank balances and cash of the Group amounted to approximately HK$81.2 million as at 30 June 2020, which was insufficient for the payment of the CB Subscription monies of Euro 10,000,000 (equivalent to approximately HK$87.6 million) and the development of the Group's bioscience businesses. Having considered the facts that (i) the cash position of the Group as at 30 June 2020 (after deducting the Designated Cash Balance) amounted to approximately HK$81.2 million and was insufficient for the payment of the CB Subscription monies of approximately HK$87.6 million and the development of the Group's bioscience businesses; (ii) the Group recorded net operating cash outflow of approximately HK$356.3 million in FY2019/20; (iii) the Group maintained the continual high level of administrative expenses (FY2019/20: approximately HK$188.5 million) and finance costs

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(FY2019/20: approximately HK$183.2 million); (iv) the Company's repayment obligations to be falling due within one year amounted to approximately HK$757.7 million as at 31 March 2020; and (v) the outbreak of COVID-19 in the PRC, Hong Kong and the United Kingdom and the subsequent quarantine measures and travel restrictions imposed by the respective local governments as well as the travel restrictions imposed by other countries in early 2020 may adversely affect the operations of the Group, we concur with the Management's view that the Group should maintain sufficient working capital for its existing operations under such challenging operating environment and that it is necessary for the Group to conduct the Subscription and the Placing to raise additional fund in order to meet the capital requirement for the development and operation of the Group's bioscience businesses and the CB Subscription.

Upon enquiry, the Management advised us that they had considered other fund-raising methods to satisfy the funding needs for the development of the bioscience businesses. In respect of the debt financing, the Directors considered that (i) while the Company has initiated discussions with banks and financial institutions, it is difficult for the Company to obtain bank borrowings on commercially justifiable terms, or at all, for development of a new business for bioscience because these bank and institutions are cautious about investing in pre-revenue bioscience projects; (ii) the Subscription can strengthen the capital base of the Company without burdening the Group with principal repayment, interests expenses and other potential stringent financing terms; (iii) debt financing requires the Group to retain a portion of Group's cash balance for principal and interests repayment, which may limit the Group's flexibility and capability to use cash for further business development and to timely capture business opportunities that may arise from time to time; (iv) the Subscription and further debt financing are not mutually exclusive and the Group may have a better position to bargain for more favourable terms from debt financiers if the Group has a larger equity base after completion of the Subscription. In respect of the pre-emptive equity fund raising (such as rights issue and open offer), the Directors have considered conducting a preemptive equity fund raising (such as rights issue and open offer) to allow all Shareholders to maintain their respective pro-rata shareholding in the Company and at the same time strengthening the capital base of the Company. However, taking into account the current challenging stock market sentiment, such fund raising exercises, in view of the fund raising size, would be relatively more time-consuming, administratively burdensome and cost- ineffective. Conducting rights issue or open offer may incur (i) comparatively higher administrative costs, professional fees and other expenses due to the need to engage various service providers, such as reporting accountants, legal advisers, independent financial adviser, share registrar and financial printer; and (ii) underwriting commission in the range of approximately 1.0% to 4.0% in general with reference to recent pre-emptive fund raising activities by companies listed on the Stock Exchange. Moreover, rights issue or open offer may require a relatively longer time period, usually not less than two (2) to three (3) months, to complete in view of the relatively more stringent documentary requirements for pre-emptive issues such as preparation of the listing documents, unaudited pro forma financial information of the Group to be included in the prospectus, application forms, share

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

certificates, refund cheques, registration of the listing documents and negotiation with the potential underwriter(s) on the terms and conditions of the underwriting agreement. Given the existing challenging business environment, the Company considers that it is necessary to control the costs of fund raising as far as is practicable. Subscription of new Shares by the Subscriber can provide higher certainty of successful funding with minimal transaction costs compared to pre-emptive equity fund raising.

The Directors considered that pre-emptive equity fund raising would be very difficult as the market demand for the Shares are minimal due to (i) the small market capitalization of the Company; (ii) the low trading volume and relatively illiquidity of the Shares; (iii) the loss-making financial position of the Group; and (iv) the cautious investors' sentiment under the recent volatile market environment. During the 24 months preceding the date of the Subscription Agreement (i.e. 24 July 2018 to 24 July 2020), (a) the average daily trading volume is less than approximately 0.05% as compared to the total number of issued Shares held by the public as at 23 July 2020 being the last trading day prior to the date of the Subscription Agreement, and (b) the daily trading amount is less than approximately HK$740,000 during the relevant period. As such, it is difficult to conduct a rights issue or open offer. Further, the outbreak of the COVID-19 and the current economic conditions also have an adverse effect on the market sentiment, and after careful assessment, the Directors consider that a rights issue or open offer may not be suitable ways for fund raising.

Notwithstanding that the Subscription will incur dilution effect on the shareholding of the existing Shareholders as discussed in the section headed ''4. Potential dilution effect on the shareholding of the Company'' below, after taking into consideration (i) the Subscription, to a certain extent, reflects the confidence and commitment of the controlling shareholder of the Company towards the long-term and sustainable development of the Company, and that the continuing support of the controlling shareholder of the Company is crucial to ensure the business stability and long-term development of the Group; (ii) the Subscription, together with the Placing, represents a good opportunity for the Group to raise additional fund of considerable amount in equity market under the recent volatile market environment; (iii) the issue of the Subscription Shares and the Placing Shares will enlarge the capital base of the Company; (iv) the Subscription and the Placing will moderate the Group's gearing level thereby strengthening the Group's financial position; (v) with the improvement in the Group's financial position, the Company will be in a better position to negotiate and obtain further fund raising arrangements for its business operation and development as and when necessary; (vi) the Group recorded continual loss for the last four financial years ended 31 March 2020, and debt financing will inevitably increase interest burden and further deteriorate the financial performance of the Group; and (vii) time taken for completion of pre-emptive equity fund raising is considerably long as compared to the Subscription and the Placing, we are of the view that the Subscription is a desirable mean for the Group to raise additional capital for the development of bioscience businesses and the CB Subscription.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Having considered the facts that (i) the cash position of the Group as at 30 June 2020 (after deducting the Designated Cash Balance) amounted to approximately HK$81.2 million and was insufficient for the payment of the CB Subscription monies of approximately HK$87.6 million and the development of the Group's bioscience businesses in future; (ii) the Subscription will not impose any interest burden and is a desirable mean for the Group when comparing with other fund raising methods; (iii) the Subscription, to a certain extent, reflects the confidence and commitment of the controlling shareholder of the Company towards the long-term and sustainable development of the Group; and (iv) the terms of the Subscription Agreement are fair and reasonable so far as the Independent Shareholders are concerned (please refer to the section headed ''3. Principal terms of the Subscription Agreement'' below for our analysis), we concur with the Management's view that the Subscription is in the interests of the Company and the Shareholders as a whole.

3. Principal terms of the Subscription Agreement

Set out below is a summary of the principal terms of the Subscription Agreement, further details of which are set out in the Letter from the Board:

The Subscription Agreement

Date:

24 July 2020 (after trading hours)

Parties:

1. The Company; and
2. The Subscriber

The Subscriber has conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, 200,000,000 Subscription Shares at the Subscription Price of HK$0.25 for each Subscription Share under the Subscription Agreement.

Subscription Shares

The 200,000,000 Subscription Shares represent (i) approximately 3.08% of the existing issued share capital of the Company as at the Latest Practicable Date; and (ii) approximately 2.99% of the issued share capital of the Company as enlarged by the Subscription Shares.

The Subscription Shares will be allotted and issued pursuant to the Specific Mandate proposed to be sought from the independent Shareholders at the EGM. Application will be made by the Company to the Listing Committee for the listing of, and the permission to deal in, the Subscription Shares.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Subscription Price

The Subscription Price is HK$0.25 per Subscription Share, which is same as the Placing Price. The Subscription Price is exclusive of transaction fees and levies.

According to the Letter from the Board, the Subscription Price was determined with reference to the prevailing market price of the Shares and was negotiated on an arm's length basis between the Company and the Subscriber.

In order to assess the fairness and reasonableness of the Subscription Price, we conducted the following analysis:

1. Comparison of the Subscription Price

The Subscription Price is the same as the Placing Price of HK$0.25 and represents:

1. a discount of approximately 13.79% to the closing price of HK$0.29 per Share as quoted on the Stock Exchange on the date of the Subscription Agreement (the ''Last Trading Day'');
2. a discount of approximately 15.25% to the average closing price of HK$0.295 per Share as quoted on the Stock Exchange for the last five consecutive trading days immediately prior to the Last Trading Day (the ''5-day Average Price'');
3. a premium of approximately 16.82% over the average closing price of approximately HK$0.214 per Share as quoted on the Stock Exchange for the last 30 consecutive trading days immediately prior to the Last Trading Day (the ''30-day Average Price'');
4. a discount of approximately 37.34% to the adjusted equity attributable to the owners of the Company (the ''NAV'') per Share of approximately HK$0.399 (based on a total of 6,491,886,805 Shares in issue as at the Latest Practicable Date and the audited equity attributable to owners of the Company of approximately HK$2,490.2 million as at 31 March 2020 as adjusted by the net proceeds of approximately HK$99.5 million from the Placing which was completed on 14 August 2020); and
5. a discount of approximately 43.82% to the closing price per Share of HK$0.445 as quoted on the Stock Exchange on the Latest Practicable Date.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

1. Historical price performance of the Shares

In assessing the fairness and reasonableness of the Subscription Price, we have primarily made reference to the historical price performance of the Shares. Set out below is the chart showing the daily closing price of the Shares as quoted on the Stock Exchange during the period commencing from 25 July 2019, being the 12-month period prior to the date of the Subscription Agreement, up to and including the Last Trading Day (being 24 July 2020) (the ''Review Period''):

Chart 1: Share price performance during the Review Period

0.350

0.300

Subscription Price = HK$0.25 per Subscription Share

0.250

Price (HK$)

0.200

0.150

Closing

0.100

0.050

0.000

25/7/2019

25/8/2019

25/9/2019

25/10/2019

25/11/2019

25/12/2019

25/1/2020

25/2/2020

25/3/2020

25/4/2020

25/5/2020

25/6/2020

Source: the website of the Stock Exchange

As illustrated in Chart 1 above, during the Review Period, the closing price of the Shares ranged from the lowest closing price of HK$0.104 per Share as recorded on 26 June 2020 to the highest closing price of HK$0.300 per Share as recorded on 20 July 2020 and 21 July 2020, with an average closing price of approximately HK$0.209 per Share. The Subscription Price represents (i) a premium of approximately 140.38% over the lowest closing price of the Shares;

1. a discount of approximately 16.67% to the highest closing price of the Shares; and (iii) a premium of approximately 19.34% over the average closing price of the Shares during the Review Period, respectively.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

During the period commencing from 25 July 2019 to 26 June 2020, the closing price of the Shares exhibited a downward trend and hit the lowest point of HK$0.104 per Share on 26 June 2020. In this regard, we have discussed with the Management regarding the downward trend of the Share price and were advised that, save for the interim results announcement for the six months ended 30 September 2019 published on 1 December 2019 and the publication of the ALS JV Announcement on 5 June 2020, they are not aware of other particular reason that led to the decreasing trend of the price of the Shares.

After reaching the lowest point on 26 June 2020, the closing price of the Shares then rebounded from 29 June 2020 and reached the highest level of HK$0.300 per Share on 20 July 2020 and 21 July 2020. We have enquired the Management regarding the upward trend of the Share price and were advised that, save for the annual results announcement for the year ended 31 March 2020 published on 26 June 2020 and the publication of the APA JV Announcement on 13 July 2020, they are not aware of any particular reason that led to the upward trend of the price of the Shares. Thereafter, the closing price of the Shares remained relatively stable and closed at HK$0.29 on the Last Trading Day.

In addition, we noted that the Subscription Price represents a discount of approximately 37.34% to the NAV per Share (based on the calculation shown above in the paragraph headed ''A. Comparison of the Subscription Price'' above). The following chart depicts the closing price of the Shares and the NAV per Share during the Review Period:

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Chart 2: Closing price of the Share versus NAV per Share during the Review Period

0.600

0.500

0.400

(HK$)

0.300

0.200

0.100

0.000

25/7/2019

25/8/2019

25/9/2019

25/10/2019

25/11/2019

25/12/2019

25/1/2020

25/2/2020

25/3/2020

25/4/2020

25/5/2020

25/6/2020

Closing price of the Shares

NAV per Share

Source: the website of the Stock Exchange

Note: The NAV per Share is calculated by dividing the equity attributable to owners of the Company as extracted from the then latest published financial reports of the Company by the total number of issued Shares at the relevant date.

Having considered that the Shares were traded at a deep discount to the NAV per Share throughout the Review Period, we consider that it is reasonable to make reference to the market price of the Share, rather than the NAV per Share, in determining the Subscription Price and that the discount of the Subscription Price to the NAV per Share is justifiable.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

1. Historical trading volume of the Shares

The following table sets out the trading volume of the Shares during the Review Period:

Table 2: Trading volume of the Shares during the Review Period

					Percentage of
				Percentage of	the average
				the average	daily trading
				daily trading	volume to the
				volume to the	total number
				total number	of Shares held
	Total		Average daily	of Shares in	by public
	trading	No. of	trading	issue	Shareholders
Month/period	volume	trading days	volume	(Note 1)	(Note 2)
	(No. of Shares)		(No. of Shares)
July 2019
(From 25 July 2019)	31,158,000	5	6,231,600	0.102%	0.310%
August 2019	38,129,332	22	1,733,151	0.028%	0.086%
September 2019	15,255,020	21	726,430	0.012%	0.036%
October 2019	32,369,195	21	1,541,390	0.025%	0.077%
November 2019	27,585,118	21	1,313,577	0.022%	0.065%
December 2019	7,952,088	20	397,604	0.007%	0.020%
January 2020	11,205,366	20	560,268	0.009%	0.028%
February 2020	42,196,144	20	2,109,807	0.035%	0.105%
March 2020	11,421,711	22	519,169	0.009%	0.026%
April 2020	9,495,612	19	499,769	0.008%	0.025%
May 2020	2,739,100	20	136,955	0.002%	0.007%
June 2020	232,105,065	21	11,052,622	0.181%	0.549%
July 2020 (up to the Last
Trading Day)	795,576,515	17	46,798,619	0.768%	2.326%

Source: the website of the Stock Exchange (www.hkex.com.hk)

Notes:

1. The calculation is based on the average daily trading volume of the Shares divided by the total issued share capital of the Company as at the Last Trading Day (i.e. 6,091,886,805 Shares).
2. The calculation is based on the average daily trading volume of the Shares divided by the number of Shares held by public Shareholders as at the Last Trading Day (i.e. 2,011,719,778 Shares).

As illustrated in Table 2 above, the average daily trading volume for the respective month/period during the Review Period ranged from approximately 136,955 Shares to approximately 46,798,619 Shares, representing approximately

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

0.002% to approximately 0.768% of the total number of the Shares in issue as at the Last Trading Day, or approximately 0.007% to approximately 2.326% of the total number of Shares held by public Shareholders as at the Last Trading Day.

During the Review Period, the average daily trading volume of the Shares was (i) approximately 0.083% of the total number of Shares in issue as at the Last Trading Day; and (ii) approximately 0.251% of the total number of issued Shares held by public Shareholders as at the Last Trading Day. We are of the view that the average daily trading volume of the Shares was relatively thin during the Review Period.

1. Comparable Analysis

To further assess the fairness and reasonableness of the Subscription Price, we have identified all issue of new shares to connected persons under specific mandate announced by companies listed on the Stock Exchange (the ''Comparables'') during the six-month period immediately before the date of the Subscription Agreement. The selection of the Comparables were based on the following criteria: (i) the share subscription constituted a connected transaction;

1. the purpose of the subject share issuance was not for partial/full settlement of a consideration for a transaction and/or loan capitalisation; (iii) the subscription shares were issued under specific mandate; and (iv) the share issuance are not by listed companies with multiple classes of shares, whose share and capital structure may be different from that of the Company (which only has a single class of shares in trading), as the capital structure of such listed companies comprised of more than one class of shares in trading and the trading price of each class of shares, where applicable, may be materially different from each other from time to time and may affect the trading price of the other class of shares. To the best of our knowledge and as far as we are aware of, we identified an exhaustive list of 7 transactions which met the said criteria and had not lapsed as at the Latest Practicable Date. Shareholders should, however, note that the businesses, operations and prospect of the Company are not the same as the Comparables. Notwithstanding that, we consider that the terms of the

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Comparables were determined under similar market conditions and sentiment and hence, provide a general reference on the key terms for this type of transaction in Hong Kong. Therefore, we consider that the Comparables are indicative in assessing the fairness and reasonableness of the Subscription Price. The following table sets forth the relevant details of the Comparables:

Table 3: Details of the Comparables

							Premium/		Premium/
						(discount)	of	(discount) of
			Premium/	issue	price over/	issue price over/
		(discount) of	to	the average	to	the average
		issue	price	over/	share price	for	share price for
		to	the	share	the	last five	(5)	the last thirty
		price	as	at the		consecutive	(30)	consecutive
		last trading day	trading days	trading days
		prior	to	the date	prior	to the date	prior	to the date
					of the		of	the		of the
		announcement/	announcement/	announcement/
			agreement		agreement		agreement
			(''Premium/		(''Premium/		(''Premium/
Date of		(Discount) -	(Discount) -	(Discount) -
announcement	Name of Company	Stock code	Last Day'')		5 Days'')		30 Days'')
					(%)		(%)
13/07/2020	51 Credit Card Inc.	2051		(24.05)		(1.64)		20.00
06/07/2020	China Jinmao Holdings	817			(6.56)		(0.56)		2.02
	Group Limited
28/04/2020	IR Resources Limited	8186			(39.13)		(41.67)		(49.23)
23/04/2020	Binhai Investment	2886			0.00		5.56		9.53
	Company Limited
03/04/2020	Gemini Investments	174			81.82		98.02		89.51
	(Holdings) Limited				(Note)		(Note)		(Note)
02/04/2020	Sinopharm Tech	8156			(12.28)		(15.25)		(25.29)
	Holdings Limited
06/02/2020	China Finance Investment	875			(31.58)		(33.94)		(30.88)
	Holdings Limited
		Maximum:			0.00		5.56		20.00
		Minimum:			(39.13)		(41.67)		(49.23)
		Median:			(18.17)		(8.45)		(11.64)
		Average:			(18.93)		(14.58)		(12.31)
	The Subscription Price:				(13.79)		(15.25)		16.82

Source: the website of the Stock Exchange (www.hkex.com.hk)

Note: As the Premium/(Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/(Discount) - 30 Days represented by the issue price of Gemini Investments (Holdings) Limited (stock code: 174) (''Gemini Investments'') is exceptionally high as compared with those of other Comparables, we consider that the issue price of Gemini

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Investments is an outlier and have excluded it from our analysis for the Premium/ (Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/

(Discount) - 30 Days represented by the Comparables.

Among the Comparables, we noted that the Premium/(Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/(Discount) - 30 Days represented by the issue price of Gemini Investments is exceptionally high as compared with those of other Comparables. Therefore, we consider that the issue price of Gemini Investments is an outlier. To avoid distortion to the overall comparable analysis due to the abnormality of such results, the Premium/ (Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/

(Discount) - 30 Days represented by the issue price of Gemini Investments has been excluded in our analysis.

As shown in Table 3 above, we noted that (i) the Premium/(Discount) - Last Day represented by the issue prices of the Comparables ranged from a discount of approximately 39.13% to 0.00%, with a median of a discount of approximately 18.17% and an average of a discount of approximately 18.93%;

1. the Premium/(Discount) - 5 Days represented by the issue prices of the Comparables ranged from a discount of approximately 41.67% to a premium of approximately 5.56%, with a median of a discount of approximately 8.45% and an average of a discount of approximately 14.58%; and (iii) the Premium/ (Discount) - 30 Days represented by the issue prices of the Comparables ranged from a discount of approximately 49.23% to a premium of approximately 20.00%, with a median of a discount of approximately 11.64% and an average of a discount of approximately 12.31%. The Premium/(Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/(Discount) - 30 Days represented by the Subscription Price are within the range of the Premium/ (Discount) - Last Day, the Premium/(Discount) - 5 Days and the Premium/
   (Discount) - 30 Days represented by the issue prices of the Comparables, respectively. More notably, the Premium/(Discount) - Last Day and the Premium/(Discount) - 30 Days represented by the Subscription Price are higher than the median and average of the Premium/(Discount) - Last Day and Premium/(Discount) - 30 Days represented by the issue prices of the Comparables, respectively.

- 41 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Notwithstanding that the Subscription Price represents a discount of approximately 13.79% and approximately 15.25% to the closing price of the Shares on the Last Trading Day and the 5-day Average Price, respectively, and a discount of approximately 37.34% to the adjusted NAV per Share (based on the calculation shown above in the paragraph headed ''A. Comparison of the Subscription Price'' above), having considered the fact that:

1. the Subscription Price is exactly the same as the Placing Price;
2. the Subscription Price is, in general, higher than the closing price of the Shares throughout the Review Period, and represents a premium of approximately 19.34% over the average closing price of the Shares during the Review Period;
3. the Shares were traded at a deep discount to the NAV per Share throughout the Review Period;
4. the Premium/(Discount) - Last Day and the Premium/(Discount) - 30 Days represented by the Subscription Price are within the range and higher than the median and average of the Premium/(Discount) - Last Day and the Premium/(Discount) - 30 Days represented by the issue prices of the Comparables, respectively, while the Premium/ (Discount) - 5 Days represented by the Subscription is within the range of the Premium/(Discount) represented by the issue prices of the Comparables; and
5. the average daily trading volume of the Shares was relatively thin during the Review Period,

we consider that the Subscription Price is fair and reasonable and the terms of the Subscription Agreement are on normal commercial terms, fair and reasonable so far as the Independent Shareholders are concerned.

- 42 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

4. Potential dilution effect on the shareholding of the Company

The shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) immediately after completion of the Subscription:

Table 4: Shareholding structure of the Company

	As at the	Immediately after completion
Shareholder	Latest Practicable Date	of the Subscription
	Number	Approximate	Number	Approximate
	of Shares	%		of Shares	%
Ms. Li (Note)	3,215,627,115		49.53		3,215,627,115		48.05
The Subscriber	30,900,000		0.48		230,900,000		3.45
	3,246,527,115		50.01		3,446,527,115		51.50
Century Golden Resources
Investment Co. Ltd.	800,000,000		12.32		800,000,000		11.96
Directors of the Company	64,539,912		1.00		64,539,912	0.96
Public
- the placees	400,000,000		6.16		400,000,000		5.98
- Other	1,980,819,778		30.51		1,980,819,778		29.60
Total	6,491,886,805		100.00		6,691,886,805	100.00

Note: Those Shares were held directly by Asia Link Capital Investment Holdings Limited (a company beneficially wholly-owned by Ms. Li) as to 3,084,816,773 Shares and by Ms. Li as to 130,810,342 Shares.

As shown in Table 4 above, the shareholding of the existing public Shareholders would be diluted from approximately 36.67% of the issued share capital of the Company as at the Latest Practicable Date to approximately 35.58% of the issued share capital of the Company immediately after completion of the Subscription. Taking into account (i) the reasons for and benefits of the Subscription as stated in the section headed ''2. Background of and reasons for the entering into of the Subscription Agreement'' above; and (ii) the terms of the Subscription Agreement are fair and reasonable so far as the Independent Shareholders are concerned, we consider that the shareholding dilution effect for the issuance of the Subscription Shares is acceptable and commercially justifiable.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

5. Financial effects of the Subscription

1. Effect on earnings

Save for the legal and professional fees/expenses to be incurred in relation to the Subscription, there will not be any immediate material impact on the earnings of the Group in this regard.

1. Effect on working capital

According to the 2019/20 Annual Report, the bank balances and cash of the Group was approximately HK$381.7 million as at 31 March 2020. Upon completion of the Subscription, the Group's cash and liquidity positions will be improved by the net proceeds from the Subscription of approximately HK$50.0 million. Accordingly, the cash and liquidity positions, net current assets and current ratio of the Group are expected to have positive impact upon completion of the Subscription.

(iii) Effect on gearing position

Upon completion of the Subscription, the Group's total borrowings will remain unchanged while the Group's total assets will increase by the net proceeds from the Subscription of approximately HK$50.0 million. Therefore, it is expected that the gearing ratio of the Group will be improved.

(iv) Effect on net assets

According to the 2019/20 Annual Report, the net asset attributable to owners of the Company was approximately HK$2,490.2 million as at 31 March 2020. Upon completion of the Subscription, the net assets of the Group will be enhanced by the net proceeds from the Subscription of approximately HK$50.0 million. As such, the entering into of the Subscription Agreement is expected to have a positive impact on the financial position of the Group.

- 44 -

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

OPINION

Having taken into account the above principal factors and reasons, we consider that although the Subscription is not in the ordinary and usual course of business of the Group, the terms of the Subscription Agreement are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned, and the entering into of the Subscription Agreement is in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Board Committee to advise, and we ourselves recommend, the Independent Shareholders to vote in favor of the ordinary resolution to be proposed at the EGM to approve the Subscription Agreement and the transactions contemplated thereunder, and the grant of the Specific Mandate.

Yours faithfully,

For and on behalf of

Astrum Capital Management Limited

Hidulf Kwan	Rebecca Mak
Managing Director	Director

Note: Mr. Hidulf Kwan has been a responsible officer of Type 6 (advising on corporate finance) regulated activity under SFO since 2006 and has participated in and completed various independent financial advisory transactions.

Ms. Rebecca Mak has been a responsible officer of Type 6 (advising on corporate finance) regulated activity under SFO since 2011 and has participated in and completed various independent financial advisory transactions.

- 45 -

APPENDIX I	GENERAL INFORMATION

1. SHARE CAPITAL

The authorised and issued share capital of the Company as at the Latest Practicable Date are as follows:

Authorised:			HK$
50,000,000,000	Shares of HK$0.01	each	500,000,000
Issued and fully paid:
6,491,886,805	Shares of HK$0.01	each	64,918,868.05

All the issued Shares rank pari passu with each other in all respects including the rights in respect of capital, dividends and voting.

2. DISCLOSURE OF INTERESTS

1. Directors and chief executive of the Company

Save as disclosed below, as at the Latest Practicable Date, none of the Directors or chief executive of the Company held any interest or short positions in the Shares, underlying Shares or debentures of the Company and any of its associated corporations (within the meaning of part XV of the SFO which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they were taken or deemed to have under such provisions of the SFO); or were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers of the Listing Rules to be notified to the Company and the Stock Exchange:

Long position
		Number of Shares	Percentage of total
		and Underlying	issued share
		Shares held (Long	capital as at Latest
Name of Director	Capacity	position)	Practicable Date
Fok Chi Tak	Beneficial owner	60,871,152	0.94%
Xu Haiying	Beneficial owner	733,752	0.01%
Ou Zhiliang	Beneficial owner	733,752	0.01%
Chan Ming Sun, Jonathan	Beneficial owner	733,752	0.01%
Lam Kwan Sing	Beneficial owner	733,752	0.01%
Lee Chi Hwa, Joshua	Beneficial owner	733,752	0.01%

Note: The percentage of shareholding is calculated on the basis of 6,491,886,805 Shares in issue as at the

Latest Practicable Date.

- 46 -

APPENDIX I	GENERAL INFORMATION

1. Substantial Shareholders

Save as disclosed below, as at the Latest Practicable Date, so far as it was known to the Directors and chief executive of the Company, no other persons had an interest or a short position in the Shares or underlying shares of the Company which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under Section 336 of Part XV of the SFO, or who (other than a member of the Group was) was, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group:

Long Position
					Approximate
					percentage of
		Nature of	Number of	total issued
Name of Shareholder	Capacity	interest	Shares held	share capital
Asia Link (Note 1)	Beneficial owner	Corporate	3,084,816,773		47.52%
Team Success (Note 1)	Beneficial owner	Corporate	30,900,000		0.48%
Li Shao Yu	Interest in controlled	Corporate
	corporation (Note 1)		3,115,716,773		48.00%
	Beneficial owner (Note 2)	Personal	130,810,342		2.01%
			3,246,527,115		50.01%
Century Golden (Note 3)	Beneficial owner	Corporate	800,000,000		12.32%

Notes:

1. Ms. Li Shao Yu is beneficially interested in 3,115,716,773 Shares, which are held by Asia Link Capital Investment Holdings Limited (''Asia Link'') as to 3,084,816,773 Shares and held by Team Success Venture Holdings Limited (''Team Success'') as to 30,900,000 Shares, both of which are beneficially wholly-owned by Ms. Li Shao Yu.
2. These Shares are held by Ms. Li Shao Yu as beneficial owner.
3. These Shares are held by Century Golden Resources Investment Co., Ltd (''Century Golden''), whose issued share capital is held by Huang Shiying and Huang Tao as to 40% and 50% respectively. Therefore, Huang Shiying and Huang Tao are deemed to be interested in these 800,000,000 Shares under SFO.

- 47 -

APPENDIX I	GENERAL INFORMATION

3. DIRECTORS' INTERESTS IN ASSETS AND CONTRACTS OF THE GROUP

Since 31 March 2020, being the date to which the latest published audited financial statements of the Group were made up, none of the Directors or proposed Directors has, or has had, any direct or indirect interest in any assets which have been acquired or disposed of by or leased to or proposed to be acquired or disposed of by or leased to, any member of the Group as at the Latest Practicable Date.

In addition, none of the Directors is materially interested in any contract or arrangement subsisting as at the Latest Practicable Date which was significant in relation to the business of the Group taken as a whole.

4. DIRECTORS' SERVICE CONTRACTS

As at the Latest Practicable Date, (i) none of the Directors had any service contracts with the Company or any of its subsidiaries or associated companies in force which (a) were continuous contracts with a notice period of 12 months or more; or (b) were fixed term contracts with more than 12 months to run irrespective of the notice period; and (ii) none of the Directors had any existing or proposed service contract with any member of the Group which does not expire or is not determinable by such member of the Group within one year without payment of compensation (other than statutory compensation).

5. DIRECTORS' INTERESTS IN COMPETING BUSINESS

As at the Latest Practicable Date, so far is known to the Directors, none of the Directors or their close associate(s) was interested in any business which competes or is likely to compete, either directly or indirectly, with the business of the Group.

6. MATERIAL LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration or claim of material importance and no litigation or claim of material importance is known to the Directors to be pending or threatened by or against any member of the Group.

- 48 -

APPENDIX I	GENERAL INFORMATION

7. MATERIAL CONTRACTS

The Group has entered into the following contracts (not being contracts entered into in the ordinary course of business) within the two years immediately preceding the Latest Practicable Date which is or may be material:

1. on 9 November 2018, Shan Dian Technology (HK) Company Limited, Tenfield Investments Limited (a direct wholly-owned subsidiary of the Company) and Access Profit Global Enterprises Group Limited (''Access Profit'') entered into a sale and purchase agreement in relation to the disposal of entire issued share capital of Access Profit at the consideration of HK$180 million. Completion of the disposal took place on 22 November 2018;
2. on 13 February 2019, Hao Tian Media & Culture Company Limited, a wholly-owned subsidiary of the Company, entered into a sale and purchase agreement with China Animation Holding (BVI) Limited in relation to the acquisition of 10,290,000 shares of Grand Peaceful Global Limited (''Grand Peaceful''), representing 49% of the entire issued share capital of Grand Peaceful at the consideration of HK$80,776,500 which would be satisfied by the Company issuing consideration shares. Completion of the acquisition took place on 22 February 2019 and 372,585,332 shares were issued by the Company;
3. on 1 March 2019, Crawler Krane Business Limited (a non wholly-owned subsidiary of the Company) entered into a sale and purchase agreement with Bravo Rich Limited in relation to the disposal of all issued shares in Chim Kee Crane Company Limited (''Chim Kee'') at the cash consideration of HK$100,000,000. Completion of the disposal took place on 29 April 2019;
4. on 5 March 2019, Glory Century Limited (''Glory Century''), an indirect wholly owned subsidiary of HTICI, placed an order with Millennium Fund Services (Asia) Limited, pursuant to which Glory Century subscribes for the 319,325.73 participating shares at the subscription amount of approximately US$20,000,000 (equivalent to approximately HK$156 million), which was satisfied by way of transferring the 588,680,000 shares in China Shandong Hi-Speed Financial Group Limited (''CSFG'') to the Riverwood China Growth Fund. Completion of the subscription took place on 6 March 2019;
5. on 10 May 2019, Fortune Jumbo Limited (''Fortune Jumbo''), an indirect wholly owned subsidiary of the Company, placed an order with Haitong International Securities Company Limited, in respect of the subscription by Fortune Jumbo for the participating shares in the Riverwood China Growth Fund at the subscription amount of US$16,000,000 (equivalent to approximately HK$124.8 million). Completion of the subscription took place on 10 May 2019;

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APPENDIX I	GENERAL INFORMATION

1. on 8 July 2019, Guo Guang Limited (a direct wholly-owned subsidiary of the Company) entered into the sale and purchase agreement with Century Golden Resources Investment Co., Ltd. in respect of the acquisition of 200,000,000 ordinary shares in Hao Tian Finance Company Limited at the consideration of HK$200,000,000, which was satisfied by way of issue and allotment of 800,000,000 shares by the Company to Century Golden Resources Investment Co., Ltd. at the issue price of HK$0.25 per share. Completion of the acquisition took place on 20 August 2019;
2. on 12 July 2019, HTICI (an indirect non-wholly owned subsidiary of the Company) entered into a sale and purchase agreement with Opulent Elite Investments Limited and Chen Tingjia in relation to the acquisition of a collection of 6 sets of canvas and paper painting art piece at the consideration of HK$80,000,000 which would be satisfied by way of allotment and issue of 275,862,069 shares to be issued by HTICI. Completion of the acquisition took place on 30 August 2019;
3. on 18 July 2019, Grace Dragon Holdings Limited (a wholly-owned subsidiary of the Company), entered into a sale and purchase agreement with Mr. Chen Ping in respect of the acquisition of 150 issued shares of Quan Yu Tai Investments Company Limited at the consideration of HK$320,000,000, which was satisfied by the issue of the promissory note in the principal amount of HK$320,000,000 by Grace Dragon Holdings Limited to Mr. Chen Ping. Completion of the acquisition took place on 16 October 2019;
4. on 29 August 2019, Hao Tian Credit Company Limited (an indirect wholly-owned subsidiary of the Company at the material time) entered into a master sale and purchase agreement with GLAM HKCFC MBS Fund in respect of the sale of the loan portfolio and the repurchase of the disposed loans at an aggregate maximum amount of consideration of HK$250 million;
5. on 10 September 2019, Hao Tian Finance Company Limited (a wholly-owned subsidiary of the Company) entered into a sale and purchase agreement with Hao Tian International Financial Holdings Limited (a wholly-owned subsidiary of HTICI) and HTICI in respect of the disposal of the entire issued share capital of Hao Tian Credit Company Limited (an indirect wholly-owned subsidiary of the Company at the material time) at a consideration of HK$213,000,000, which shall be satisfied by the issue of a 5% convertible notes due 2022 in the principal amount of HK$213,000,000 by HTICI to Hao Tian Finance Company Limited (or its nominees). Completion of the sale and purchase took place on 31 January 2020;
6. on 6 December 2019, Hao Tian Management (Hong Kong) Limited (a subsidiary of the Company) as vendor entered into the Sale and Purchase Agreement 2019 with Billion Accomplish Limited as purchaser and its sole shareholder as a guarantor in respect of the sale and purchase of an aggregate of 2,148,559,650 shares in CSFG at the sale price of HK$0.27 per share for an aggregate consideration of approximately

- 50 -

APPENDIX I	GENERAL INFORMATION

HK$580,111,106 and Completion took place on 11 December 2019. On 10 March 2020, the Group enforced the share charge created over the disposed shares in CSFG, which were transferred back to the Group;

1. on 5 March 2020, Hao Tian Media & Culture Company Limited, a wholly-owned subsidiary of the Company, entered into a sale and purchase agreement with China Animation Holding (BVI) Limited in relation to the acquisition of 50% of the issued share capital of Success View Global Limited, which would be satisfied by the Company issuing convertible notes in the principal amount of HK$100,000,000. Completion of the acquisition took place on 26 March 2020;
2. on 16 March 2020, each of Hao Tian Management (Hong Kong) Limited and Glory Century Limited entered into a sale and purchase agreement with JS High Speed Limited for the sale of a total of 2,833,901,650 shares in CSFG at the sale price of HK$0.285 per share for an aggregate consideration of approximately HK$580,111,106 and completion took place on 18 March 2020;
3. on 2 April 2020, HTICI and Oshidori International Holdings Limited (''Oshidori'') entered into the share swap agreement pursuant to which HTICI agreed to issue and allot the 625,000,000 shares of HTICI under general mandate to Oshidori in exchange of 187,500,000 shares of Oshidori. Completion of the share swap took place on 28 April 2020;
4. on 5 June 2020, Success Destiny Limited, a wholly-owned subsidiary of the Company entered into the subscription agreement and shareholders' agreement with Co-High Investment Management Limited for the formation of a joint venture for the new bioscience business and the grant of a put option and a call option in relation to the equity interest in Aceso Life Science Holding Limited held by Co-High Investment Management Limited;
5. on 9 July 2020, the Company and Co-High Investment Management Limited entered into an conditional option deed for the grant of 609,188,681 options for the subscribe for 609,188,681 new Shares at the exercise price of HK$0.25 each;
6. on 13 July 2020, Aceso Life Science Holding Limited, a non-wholly owned subsidiary of the Company entered into the joint venture agreement with Promethera Biosciences S.A./N.V. for the formation of a joint venture to develop and commercial the bioscience products of Promethera Biosciences S.A./N.V. in China and Southeast Asia;
7. on 13 July 2020, the Company entered into a subscription agreement with Promethera Biosciences S.A./N.V. for the subscription of convertible bonds in the principal amount of up to Euro 10,000,000 (equivalent to approximately HK$87,600,000) to be issued by Promethera Biosciences S.A./N.V. in two tranches;
8. the Placing Agreement; and
9. the Subscription Agreement.

- 51 -

APPENDIX I	GENERAL INFORMATION

8. EXPERT'S QUALIFICATIONS AND CONSENT

The following is the qualification of the expert who has given opinions, letters or advice which are contained in this circular:

Name	Qualification
Astrum Capital Management	a corporation licensed to carry out type 1 (dealing in
Limited	securities), type 2 (dealing in futures contracts), type 6
	(advising on	corporate finance) and type 9 (asset
	management)	regulated activities under the SFO

As at the Latest Practicable Date, the expert named above was not beneficially interested in, the share capital of any member of the Group or had any right, whether legally enforceable or not, to subscribe for or to nominate persons to subscribe for securities in any member of the Group and did not have any interest, either directly or indirectly, in any assets which have been, since 31 March 2020 (being the date to which the latest published audited financial statements of the Company were made up), acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Group.

The Independent Financial Adviser has given, and has not withdrawn, its written consent to the issue of this circular with the inclusion of the references to its name and/or its opinion in the form and context in which they are included.

9. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 March 2020 (the date to which the latest published audited accounts of the Group were made up).

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the principal place of business of the Company in Hong Kong at Rooms 2501-2509, 25/F, Shui On Centre, 6-8 Harbour Road, Wan Chai, Hong Kong during normal business hours from 9:00 a.m. to 5:00 p.m. (except Saturdays and public holidays) for a period of 14 days from the date of this circular:

1. the memorandum and articles of association of the Company;
2. the material contracts referred to in the paragraph headed ''Material Contracts'' in this appendix;
3. the letter from the Board, the text of which is set out on pages 6 to 18 of this circular;

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APPENDIX I	GENERAL INFORMATION

1. the ''Letter from the Independent Board Committee'', the text of which is set out on page 19 of this circular;
2. the ''Letter from the Independent Financial Adviser'', the text of which is set out on pages 20 to 45 of this circular;
3. the written consent referred to in the paragraph headed ''Expert's Qualifications and Consent'' of this appendix; and;
4. this circular.

11. MISCELLANEOUS

1. The registered office of the Company is located at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111, Cayman Islands.
2. The principal place of business of the Company in Hong Kong is located at Rooms 2501-2509, 25th Floor, Shui On Centre, 6-8 Harbour Road, Wanchai, Hong Kong.
3. The share registrar and transfer office in the Cayman Islands of the Company is SMP Partners (Cayman) Limited at Royal Bank House - 3rd Floor, 24 Shedden Road, P.O. Box 1586, Grand Cayman, KY1-1110, Cayman Islands and the Hong Kong branch share registrar and transfer office of the Company is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17/F, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong.
4. The company secretary of the Company is Ms. Chan Lai Ping, who is a qualified lawyer in Hong Kong.
5. In the event of any inconsistencies, the English text of this circular shall prevail over the Chinese text.

- 53 -

APPENDIX II	PROCEDURES FOR POLL VOTING AND
	PRECAUTIONARY MEASURES FOR THE EGM

PROCEDURES FOR POLL VOTING

The chairman of the meeting will at the EGM and, pursuant to article 66 of the Articles, poll voting on all resolutions set out in the notice of the EGM.

On a poll, every Shareholder present in person or by proxy or, in the case of a Shareholder being a corporation, by its duly authorised representatives, shall have one vote for every Share of which he/she is the holder.

A Shareholder present in person or by proxy or by authorised representatives who is entitled to more than one vote does not have to use all his/her votes (i.e., he/she can cast less votes than the number of Shares he/she holds or represents) or to cast all his/her votes the same way (i.e., he/she can cast some of his/her votes in favour of the resolution and some of his/her votes against the resolution).

The poll voting slip will be distributed to Shareholders or their proxies or authorised representatives upon registration of attendance at the EGM. Shareholders who want to cast all their votes entitled may mark a ''P'' in either ''FOR'' or ''AGAINST'' box corresponding to the resolution to indicate whether he/she supports that resolution. For Shareholders who do not want to use all their votes or want to split votes in casting a particular resolution shall indicate the number of votes cast on a particular resolution in the ''FOR'' or ''AGAINST'' box, where appropriate, but the total votes cast must not exceed his/her entitled votes, or otherwise, the voting slip will be spoiled and the Shareholder's vote will not be counted.

After closing the poll, the Company's share registrar, Computershare Hong Kong Investor Services Limited, will act as scrutineer and count the votes and the poll results will be published after the EGM.

PRECAUTIONARY MEASURES FOR THE EGM

In view of the ongoing COVID-19 epidemic and recent requirements for prevention and control of its spread, the Company will implement the following preventive measures at the EGM to protect attending Shareholders, staff and other stakeholders from the risk of infection:

1. Compulsory body temperature checks will be conducted on Shareholders, proxies and other attendees at the entrance of the EGM venue. Any person with a body temperature of over 37.4 degrees Celsius may be denied entry into the EGM venue.
2. Shareholders, proxies and other attendees are required to complete and submit a health declaration form providing their names and contact details, and confirming that they are not subject to quarantine and they, or to their best of knowledge, any person whom

- 54 -

APPENDIX II	PROCEDURES FOR POLL VOTING AND
	PRECAUTIONARY MEASURES FOR THE EGM

they have/had close contact with, have not entered Hong Kong from Mainland China or any overseas countries/areas at any time in the preceding 14 days. Any person who does not comply with this requirement may be denied entry into the EGM venue.

1. Shareholders, proxies and other attendees are required to wear surgical face masks inside the EGM venue at all times. Any person who does not comply with this requirement may be denied entry into the EGM venue.
2. No refreshments or drinks will be provided at the EGM.

To the extent permitted under law, the Company reserves the right to require any person to deny entry into the EGM venue in order to ensure the safety of the attendees at the EGM. In the interest of all stakeholders' health and safety and consistent with recent COVID-19 guidelines for prevention and control, the Company reminds all Shareholders that physical attendance in person at the EGM is not necessary for the purpose of exercising voting rights. As an alternative, by using proxy forms with voting instructions inserted, Shareholders may appoint the Chairman of the EGM as their proxy to vote on the relevant resolutions at the EGM instead of attending the EGM in person.

- 55 -

NOTICE OF EXTRAORDINARY GENERAL MEETING

昊天發展集團有限公司

Hao Tian Development Group Limited

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 00474)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the extraordinary general meeting of Hao Tian Development Group Limited (the ''Company'') will be held at 10/F, CKK Commercial Centre, 289 Hennessy Road, Wanchai, Hong Kong on Friday, 18 September 2020 at 1:00 p.m. (or as soon thereafter as the extraordinary general meeting of the Company to be held at 12:30 p.m. on the same day and at the same place is concluded or adjourned) for the purposes of considering and, if thought fit, passing, with or without modifications, the following resolution:

ORDINARY RESOLUTION

1. ''THAT

1. the Subscription Agreement dated 24 July 2020 (a copy of which has been produced to this meeting marked ''A'' and signed by the chairman of this meeting for the purpose of identification) entered into between the Company and Team Success Venture Holdings Limited (the ''Subscriber'') in relation to the subscription of 200,000,000 new ordinary shares of the Company (the
   ''Subscription Shares'') at the subscription price of HK$0.25 per Subscription Share, and all transactions contemplated thereunder and all other matters thereof and incidental thereto and in connection therewith, be and are hereby generally and unconditionally approved, confirmed and ratified in all respects;
2. conditional upon The Stock Exchange of Hong Kong Limited granting the listing of, and permission to deal in the Subscription Shares, the directors (the
   ''Directors'' and each a ''Director'') of the Company be and are hereby granted a specific mandate (the ''Specific Mandate'') to allot and issue the Subscription Shares, such Specific Mandate being in additional to and not prejudicing or revoking any general or specific mandate(s) which has/have been granted or may from time to time be granted to the Directors by the shareholders of the Company; and

- 56 -

NOTICE OF EXTRAORDINARY GENERAL MEETING

1. any one Director be and is hereby generally and unconditionally authorised to do all such acts or things and execute and deliver all such documents, instruments and agreements which they consider necessary, desirable or expedient to give effect to the transactions contemplated by the Subscription Agreement and the allotment and issue of the Subscription Shares, and to agree to such variation, amendments or waiver of matters relating thereto as are, in the opinion of the Director, in the interests of the Company.''

By Order of the Board

Hao Tian Development Group Limited

Chan Lai Ping

Company Secretary

Hong Kong, 1 September 2020

Principal place of business in Hong Kong:

Room 2501-2509, 25th Floor

Shui On Centre

6-8 Harbour Road, Wanchai

Hong Kong

Notes:

1. A member entitled to attend and vote at the above meeting (or at any adjournment thereof) is entitled to appoint another person as his proxy to attend and vote in his stead. A proxy need not be a member of the Company.
2. Where there are joint registered holders of any shares, any one of such persons may vote at the above meeting (or at any adjournment thereof), either personally or by proxy, in respect of such shares as if he were solely entitled thereto; but if more than one of such joint holders be present at the above meeting personally or by proxy, that one of the said persons so present whose name stands first on the register of members of the Company in respect of such share shall alone be entitled to vote in respect thereof.
3. In order to establish entitlements to attend and vote at the EGM, the register of members of the Company will be closed from Tuesday, 15 September 2020 to Friday, 18 September 2020, both days inclusive, during which period no transfer of Shares will be registered. All transfers of Shares accompanied by the relevant share certificates and properly completed transfer forms must be lodged with the branch share registrar of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, for registration no later than 4:30 p.m. on Monday, 14 September 2020.
4. In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed or a certified copy of that power of attorney or authority (such certification to be made by either a notary public or a solicitor qualified to practise in Hong Kong), must be deposited with the branch share registrar and transfer office of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, not less than 48 hours before the time fixed for holding the above meeting or any adjournment thereof.
5. Completion and return of the form of proxy will not preclude a member from attending and voting in person at the extraordinary general meeting or any adjourned meeting (as the case may be) should he so wish.

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NOTICE OF EXTRAORDINARY GENERAL MEETING

6. The translation into Chinese language of this notice is for reference only. In case of any inconsistency, the English version shall prevail.

As at the date of this notice, the Board comprises three executive Directors, namely Mr. Xu Haiying, Dr. Zhiliang Ou, JP (Australia), and Mr. Fok Chi Tak; two non-executive Directors, namely Dr. Wang Yu and Dr. Li Yao; and three independent non-executive Directors, namely Mr. Chan Ming Sun, Jonathan, Mr. Lam Kwan Sing and Mr. Lee Chi Hwa, Joshua.

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