Major Shareholder:

• Hon Po Holdings Limited - 60.32% interest

Hon Po is the holding company for a group of companies engaged in the operation of 17 restaurants in Hong Kong under the names "Hon Po Restaurant", "Hon Po Seafood Restaurant" and "Hon Palace Restaurant". The Group's restaurants specialise in serving Chinese dim sum and main courses, in particular, lobster cuisine and other seafood delicacies.

The Directors believe the Group has become one of the most popular restaurant chains in Hong Kong specializing in the provision of Chinese seafood, especially lobster dishes. The Directors believe that due to the strategic locations of the Group's restaurants, the majority of the Group's customer base consists of patrons working or residing in the nearby densely populated residential, commercial or industrial area to its restaurants.

The Directors believe that the principal strengths of the Group lie in the following areas:

• An experienced management team
• A high standard of quality and hygiene
• An established reputation for quality food at competitive prices
• Prime locations and decor of the restaurants
• Centralization of purchases or raw materials
• A broad and established list of suppliers
• A profitable business which generates cash flows for expansion

Operations and results of the Group are subject to a number of risks which are categorised and summarised as follows:

• Reliance on key personnel
• Reliance on suppliers
• Expansion into the PRC market
• Hygiene control for seafood
• Licensing requirements
• Competition
• General economic environment in Hong Kong
• The impact of proposed smoke-free policies on Hong Kong restaurants

The Directors consider that the Group has established a reputation for high quality restaurants providing quality food at competitive prices. The Group intends to continue its expansion by opening one to two additional restaurants in Hong Kong over a period of two years. In particular, the Group anticipates expansion of its restaurant chains in the newly developed shopping arcades and other densely populated areas.

To implement vertical integration and to increase the Group's source of income, the Group plans to set up a food factory for the production of various seasonal foods, which will be sold initially in Hong Kong. The seasonal food, which the Group proposes to sell, includes New Year cake during the Chinese New Year, glutinous rice dumplings during the Dragon Boat Festival and moon cakes during the Mid-Autumn Festival

The Group's vision is to become one of the leading Chinese restaurant chains in the PRC market and the Directors believe that expansion to the PRC market will expedite the growth of the Group. The Group plans to initially open one to two new restaurants in densely populated areas in Mainland China that have high consuming power. These areas include Shenzhen, Shanghai and Beijing, where the Directors believe that there is , and will be, substantially demand for quality Chinese Food.

The net proceeds from the Placing, after deducting the related expenses, are estimated to amount to approximately HK$23.8 million. The Group at present intends to apply the net proceeds as follows: