Carnival Group International Holdings Limited 嘉 年 華 國 際 控 股 有 限 公 司. (Incorporated in Bermuda with limited liability) (Stock Code: 00996)

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. This announcement is for information purposes only and does not constitute an invitation or solicitation of an offer to acquire, purchase or subscribe for securities or an invitation to enter into an agreement to do any such things, nor is it calculated to invite any offer to acquire, purchase or subscribe for any securities. Carnival Group International Holdings Limited 嘉 年 華 國 際 控 股 有 限 公 司 (Incorporated in Bermuda with limited liability) (Stock Code: 00996) PROPOSED ISSUE OF UP TO US$200,000,000 8% SECURED CONVERTIBLE BONDS DUE 2018 (WITH AN OPTION TO ISSUE UP TO AN ADDITIONAL US$100,000,000 8% SECURED CONVERTIBLE BONDS DUE 2018) UNDER GENERAL MANDATE Lead Manager On 3 July 2015 (after trading hours), the Company, as issuer, entered into the Placing Agreement with China Minsheng, as lead manager, pursuant to which the Company has conditionally agreed to issue, and China Minsheng has conditionally agreed to use its best efforts to procure Other Investors to subscribe for the CB in the principal amount of up to US$200,000,000 (or up to US$300,000,000 if the Option is exercised) at the initial Conversion Price of HK$1.39 per Share. As at the date of this announcement, the Company has a total of 14,138,884,046 Shares in issue. Assuming (i) there is no further allotment and issue or repurchase of the Shares; (ii)

2 US$200,000,000 in principal amount of the CB is issued by the Company; and (iii) there is full conversion of the CB at the initial Conversion Price of HK$1.39 per Share based on the agreed exchange rate of US$1 = HK$7.755, the CB will be convertible into 1,115,827,338 Conversion Shares, representing approximately 7.9% of the existing issued share capital of the Company as at the date of this announcement and approximately 7.3% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares. Assuming (i) there is no further allotment and issue or repurchase of the Shares; (ii) the Option is exercised, US$300,000,000 in principal amount of the CB is issued by the Company; and (iii) there is full conversion of the CB at the initial Conversion Price of HK$1.39 per Share based on the agreed exchange rate of US$1 = HK$7.755, the CB will be convertible into 1,673,741,007 Conversion Shares, representing approximately 11.8% of the existing issued share capital of the Company as at the date of this announcement and approximately 10.6% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares. The Conversion Shares will be allotted and issued pursuant to the General Mandate granted to the Directors at the annual general meeting of the Company held on 28 April The allotment and issue of the Conversion Shares is not subject to the approval of the Shareholders. Assuming US$200,000,000 in principal amount of the CB is issued by the Company, the gross proceeds of the CB Issue will amount to US$200,000,000. The net proceeds of the CB Issue, after deducting commission and other related expenses payable by the Company, are estimated to be approximately US$195.7 million. Assuming US$300,000,000 in principal amount of the CB is issued by the Company, the gross proceeds of the CB Issue will amount to US$300,000,000. The net proceeds of the CB Issue, after deducting commission and other related expenses payable by the Company, are estimated to be approximately US$293.7 million. The Company intends to apply the net proceeds for general corporate purposes. No listing of the CB will be sought on the Stock Exchange or any other stock exchange. The Company will apply to the listing committee of the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares on the Stock Exchange. Completion of the CB Issue is subject to fulfillment, and/or waiver, of certain conditions stated in the Placing Agreement. In addition, the Placing Agreement may be terminated upon the occurrence of certain events. Please refer to the section headed The Placing Agreement in this announcement for further information. As the CB Issue may or may not be completed, Shareholders and prospective investors are reminded to exercise caution when dealing in the Shares. 2

3 The Board is pleased to announce that on 3 July 2015 (after trading hours), the Company entered into the Placing Agreement with China Minsheng in connection with the CB Issue in the principal amount of up to US$200,000,000 (or up to US$300,000,000 if the Option (as defined below) is exercised). Details of the Placing Agreement are set out below. THE PLACING AGREEMENT Date 3 July 2015 (after trading hours) Parties (a) the Company (as issuer); and (b) China Minsheng (as lead manager). To the best of the Directors knowledge, information and belief, having made all reasonable enquiries, China Minsheng and its ultimate beneficial owners are third parties independent of the Company and the connected persons of the Company. The Subscription The Company has conditionally agreed to issue, and China Minsheng has conditionally agreed to use its best efforts to procure Other Investors to subscribe for, the CB in the principal amount of US$30,000,000 on the date of the first Closing. The Company has conditionally agreed to issue, and China Minsheng has conditionally agreed to use its best efforts to procure Other Investors to subscribe for, the CB in the principal amount of US$100,000,000 on the date of the second Closing. China Minsheng shall use its best efforts to procure Other Investors to subscribe for the CB in the principal amount of up to US$70,000,000 and shall have the option (the Option ) to require the Company to issue further additional CB to Other Investors in the principal amount of up to US$100,000,000. Subject to and in accordance with the provisions of the Placing Agreement, China Minsheng may, within 45 days of the date of the Placing Agreement (or such other period as may be agreed between China Minsheng and the Company), by notice in writing (the Issue Notice ) to the Company, require the Company to issue to such Other Investors procured by China Minsheng the CB in the principal amount of up to US$70,000,000 (or up to US$170,000,000 in total if the Option is exercised) on the date of the third Closing. 3

4 Closing conditions The obligations of the Company and China Minsheng to effect any of the Closings shall be conditional upon: 1) the execution and delivery of the Trust Deed, the Agency Agreement, the Guarantee and the Security Documents by the respective parties thereto on or before the date of the first Closing; 2) on the relevant Closing Date: (a) the representations, warranties, agreements and undertakings of the Company in the Placing Agreement being true, accurate and correct at, and as if made on, the relevant Closing Date; (b) the Company having performed all of its obligations under the Placing Agreement to be performed on or before the relevant Closing Date; and (c) there having been delivered to China Minsheng a closing certificate dated the relevant Closing Date, signed by an authorised signatory of the Company to such effect; 3) on or before the date of the first Closing, there shall have been delivered to China Minsheng, in form and content, satisfactory to China Minsheng, opinions as to Hong Kong law, Bermuda law, BVI law and PRC law, in each case dated the date of the first Closing and addressed to China Minsheng and the Trustee and such other documents, opinions and certificates relating to the issue of the CB and the creation of the Security as China Minsheng may require; 4) after the date of the Placing Agreement up to and at the relevant Closing Date, there shall not have occurred any change (nor any development or event involving a prospective change), which is, in the reasonable opinion of China Minsheng, materially adverse to the condition (financial or other), results of operations or general affairs of the Company or the Group or the condition (financial or other) or general affairs of the Guarantor; 5) on or prior to the relevant Closing Date there shall have been delivered to the order of China Minsheng (a) the relevant closing deliverables as set out in the Placing Agreement and (b) all consents and approvals required in relation to the CB Issue, the giving of the Guarantee, the creation and perfection of the Security and the performance of the obligations of the Company, the Guarantor and the Chargors under the Transaction Documents, the Security Documents and the CB (including any consents and approvals required from all lenders); and 6) the listing committee of the Stock Exchange having granted approval to the listing of, and the permission to deal in, the Conversion Shares. China Minsheng may at any time and upon such terms as it thinks fit waive compliance with any of the above closing conditions (other than the closing condition in paragraph 6 above) by notice in writing to the Company. 4

5 If the above closing conditions are not either waived or satisfied, as the case may be, by 30 September 2015 or such later date as may be agreed by China Minsheng and the Company, the parties obligations under the Placing Agreement shall automatically terminate and no party shall have any claim against the other for costs, damages, compensation or otherwise save for any claim in respect of antecedent breaches and certain liabilities of the Company under the Placing Agreement. Closings Subject to the satisfaction and/or waiver of the closing conditions set out in the section headed Closing conditions above, multiple Closings of the subscription of the CB will take place as follows: 1. the first Closing of the subscription of the CB in the principal amount of US$30,000,000 by Other Investors will take place on the third (3 rd ) Business Day after, and excluding, the date upon which the closing condition in paragraph 6 set out in the section headed Closing conditions above has been satisfied, or such other date as the parties may agree in writing; 2. the second Closing of the subscription of the CB in the principal amount of US$100,000,000 by Other Investors will take place on such date as may be notified to the Company by China Minsheng which, in any event, shall not be more than 30 days after the date of the Placing Agreement, or such other date as may be agreed between China Minsheng and the Company; and 3. in the event that China Minsheng issues the Issue Notice to the Company within 45 days of the date of the Placing Agreement (or such other period as may be agreed between China Minsheng and the Company) requiring the Company to issue to such Other Investors procured by China Minsheng the CB in the principal amount of up to US$70,000,000 (or up to US$170,000,000 in total if the Option is exercised), Closing of the issue of such CB will take place on the third Business Day after the date of the Issue Notice (or such other date as may be agreed between China Minsheng and the Company). On each Closing Date, China Minsheng shall instruct Other Investors to pay to the Company the relevant issue price in respect of the aggregate principal amount of CB to be subscribed by such Other Investors. 5

6 Guarantee and Security On the date of the first Closing, Mr. King Pak Fu will enter into the Guarantee to unconditionally and irrevocably guarantee the due and punctual payment of all sums expressed to be payable by the Company under the CB and the Trust Deed. Further, the Chargors will enter into the Composite Share Charge to charge shares of certain subsidiaries of the Company in favour of the Security Trustee for the benefit of itself and the CB Holders as continuing security for the payment or discharge of all moneys, liabilities and obligations at any time due, owing, payable to the Secured Parties or any of them by the Company under or pursuant to the CB, the Transaction Documents and the Security Documents or any of them, whether present or future, actual or contingent (and whether incurred solely or jointly and whether as principal or surety or in some other capacity). Lock up undertaking Pursuant to the Placing Agreement, neither the Company nor any person acting on its behalf will, without the prior written consent of China Minsheng, issue, allot, sell, offer or agree to issue, allot, sell, grant any option for the sale of, or otherwise dispose of, or make any announcement relating thereto, (i) for a period of 180 days from and including the date of the Placing Agreement any Shares or (ii) for the period from the date of the Placing Agreement to the first anniversary of the Placing Agreement (both dates inclusive) any rights, warrants, options or other securities of the Company or any other member of the Group that are convertible, exchangeable or exercisable into the Shares or entitle the holders or beneficiaries thereof to subscribe for, purchase or acquire any Shares, unless the sum of the aggregate nominal value of such Shares issued and the maximum aggregate nominal value of Shares that holders or beneficiaries of such rights, warrants, options or other securities may or are entitled to receive therefrom (as the case may be), in aggregate, do not exceed 20% of the aggregate nominal value of the share capital of the Company in issue as at the date of the Placing Agreement, provided that the above restriction shall not apply to the issue of (a) the CB, (b) the Conversion Shares, (c) options granted under the share option scheme of the Company adopted on 31 May 2013 and Shares falling to be issued upon exercise of such options, (d) Shares falling to be issued upon exercise of the conversion right attaching to the convertible notes issued by the Company on 21 December 2011, and (e) the exchangeable and convertible bonds issued by the Company on 17 June 2015 in the aggregate principal amount of HK$240,740,000 and the Shares falling to be issued upon exercise of the conversion rights attaching to such exchangeable and convertible bonds. 6

7 Termination China Minsheng may, by notice to the Company, terminate the Placing Agreement prior to the relevant Closing Date in any of the following circumstances: 1) if there shall have come to the notice of China Minsheng any breach of, or any event rendering untrue or incorrect in any respect, any of the representations and warranties contained in the Placing Agreement or any failure to perform any of the Company's undertakings or agreements in the Placing Agreement; 2) if any of the closing conditions set out in the section headed Closing conditions above has not been satisfied or waived by China Minsheng; 3) since the date of the Placing Agreement, there has been, in the opinion of China Minsheng, such a change or any development involving a prospective change in national or international financial, political or economic conditions or currency exchange rates or exchange controls which, in its view, is likely to prejudice materially the success of the offering and distribution of the CB or dealings in the CB in the secondary market; 4) if, in the opinion of China Minsheng, there shall have occurred any of the following events: (i) a suspension or a material limitation in trading in securities generally on the New York Stock Exchange, the London Stock Exchange plc and/or the Stock Exchange and/or any other stock exchange on which securities of any Group Company are traded; (ii) a general moratorium on commercial banking activities in the United States, the PRC, Hong Kong and/or the United Kingdom declared by the relevant authorities or a material disruption in commercial banking or securities settlement or clearance services in the United States, the PRC, Hong Kong or the United Kingdom; or (iii) a change or development involving a prospective change in taxation affecting the Company, the Guarantor, the CB or the transfer thereof; or 5) if, in the opinion of China Minsheng, there shall have occurred any event or series of events (including the occurrence of any local, national or international outbreak or escalation of disaster, hostility, insurrection, armed conflict, act of terrorism, act of God or epidemic) as would in its view be likely to prejudice materially the success of the offering and distribution of the CB or dealings in the CB in the secondary market. Upon notice being given by China Minsheng to terminate the Placing Agreement, the parties obligations under the Placing Agreement in respect of the issue of the relevant CB shall terminate and be of no further effect and no party shall be under any liability to any other under the Placing Agreement, save for certain obligations as set out in the Placing Agreement. 7

8 PRINCIPAL TERMS AND CONDITIONS OF THE CB The principal terms and conditions of the CB are arrived at after arm s length negotiations between the Company and China Minsheng and are summarized as follows. This summary is not complete and is qualified in its entirety by reference to provisions of the documents relating to the CB. Issuer The Company will be the issuer of the CB. Principal amount The aggregate principal amount of the CB is up to US$200,000,000 (or up to US$300,000,000 if the Option is exercised). Issue price The issue price of the CB on the date of the first Closing will be 100% of the principal amount of the CB. The issue price of the CB on the date of the second Closing will be 100% of their principal amount plus an amount equal to the product of the principal amount of CB to be issued on the date of the second Closing, the Rate of Interest (as defined in the terms and conditions of the CB) and the Day Count Fraction (as defined in the terms and conditions of the CB) for the period from and including the date of the first Closing to but excluding the date of the second Closing, rounding the resulting figure to the nearest cent (half a cent being rounded upwards). The issue price of the CB on the date of the third Closing will be 100% of their principal amount plus an amount equal to the product of the principal amount of CB to be issued on the date of the third Closing, the Rate of Interest (as defined in the terms and conditions of the CB) and the Day Count Fraction (as defined in the terms and conditions of the CB) for the period from and including the date of the first Closing to but excluding the date of the third Closing, rounding the resulting figure to the nearest cent (half a cent being rounded upwards). Interest The CB will bear interest from and including the date of the first Closing at the rate of 8% per annum, payable semi-annually in arrears in equal instalments of US$200,000 per authorised denomination. 8

9 Maturity The CB will mature on the third anniversary of the date of the first Closing, or if such date is not a Business Day, the Business Day immediately following such date. Conversion right and conversion period Each CB Holder has the right to convert the principal amount of the CB into fully-paid Shares to be issued by the Company and listed and traded on the Stock Exchange at the CB Holder s election at any time during the conversion period, which is the period beginning on, and including, the date of the first Closing and ending on, and including, the day which is five (5) Business Days before the maturity date. The conversion period may be extended under certain circumstances as set out in the terms and conditions of the CB. Initial Conversion Price The initial Conversion Price is HK$1.39 per Share, which was determined after arm s length negotiation between the Company and China Minsheng based on prevailing market practice. The initial Conversion Price of HK$1.39 per Share represents: (a) (b) a premium of approximately 16.8% over the closing price of HK$1.19 per Share as quoted on the Stock Exchange on 3 July 2015, being the date of the Placing Agreement; and a premium of approximately 14.9% over HK$1.21 per Share, being the average of the closing prices as quoted on the Stock Exchange for the five consecutive trading days up to and including 3 July 2015, being the date of the Placing Agreement. The initial Conversion Price is subject to adjustments from time to time on the occurrence of certain events in accordance with the terms and conditions of the CB, including but not limited to, alteration to the nominal value of the Shares as a result of consolidation, subdivision, redenomination or re-classification, capitalisation of profits or reserves, distributions, rights issues of Shares or options over Shares at less than 85% of the then market price per Share to Shareholders, rights issues of other securities to Shareholders, other issues at less than 85% of the then market price per Share, modification of rights of conversion, exchange or subscription attaching to certain securities other than in accordance with the terms of such securities so that the consideration per Share for the number of Shares available on conversion, exchange or subscription following the modification is reduced and is less than 85% of the then current market price per Share, and other offers to Shareholders. 9

10 Conversion ratio The number of Shares to be issued upon exercise of a conversion right attaching to any CB will be determined by dividing the principal amount of the CB to be converted into Hong Kong dollars at the rate of US$1 = HK$7.755 by the Conversion Price. As at the date of this announcement, the Company has a total of 14,138,884,046 Shares in issue. Assuming (i) there is no further allotment and issue or repurchase of the Shares; (ii) US$200,000,000 in principal amount of the CB is issued by the Company; and (iii) there is full conversion of the CB at the initial Conversion Price of HK$1.39 per Share based on the agreed exchange rate of US$1 = HK$7.755, the CB will be convertible into 1,115,827,338 Conversion Shares, representing approximately 7.9% of the existing issued share capital of the Company as at the date of this announcement and approximately 7.3% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares. Assuming (i) there is no further allotment and issue or repurchase of the Shares; (ii) the Option is exercised, US$300,000,000 in principal amount of the CB is issued by the Company; and (iii) there is full conversion of the CB at the initial Conversion Price of HK$1.39 per Share based on the agreed exchange rate of US$1 = HK$7.755, the CB will be convertible into 1,673,741,007 Conversion Shares, representing approximately 11.8% of the existing issued share capital of the Company as at the date of this announcement and approximately 10.6% of the issued share capital of the Company as enlarged by the allotment and issue of the Conversion Shares. Security All moneys, liabilities and obligations at any time due, owing or payable to the Secured Parties or any of them by the Company under or pursuant to the CB, Transaction Documents and the Security Documents or any of them, whether present or future, actual or contingent (and whether incurred solely or jointly and whether as principal or surety or in some other capacity), are secured by the Security granted by the Company and other Chargors in favour of the Security Trustee for the benefit of itself and the CB Holders. Ranking of the CB The CB will constitute direct, senior, unsubordinated, unconditional and secured obligations of the Company and will at all times rank pari passu and without any preference or priority among themselves. The payment obligations of the Company under the CB shall, save for such exceptions as may be provided by mandatory provisions of applicable legislation, at all times rank at least equally with all of its other present and future unsecured and unsubordinated obligations. 10

11 Ranking of the Conversion Shares The Conversion Shares to be allotted and issued upon conversion of the CB will be duly and validly issued as fully-paid and free from any encumbrance and will rank at least pari passu with all other Shares then in issue. Redemption (a) Redemption at maturity Unless previously redeemed, converted or purchased and cancelled as provided in the terms and conditions of the CB, the Company shall, subject to receipt of the relevant CB certificate, redeem all the outstanding CB held by a CB Holder on the maturity date. (b) Early Redemption at the option of the CB Holder Unless previously redeemed, converted or purchased and cancelled as provided in the terms and conditions of the CB (or a notice has been served by any CB Holder in accordance with the terms and conditions of the CB to redeem or convert the outstanding CB), on giving not less than 30 nor more than 60 days notice before the second anniversary of the date of first Closing, together with the relevant CB certificate, to the Company, the CB Holder may require the Company to redeem in whole, or in part, such CB for the time being outstanding. (c) Redemption for change of control At any time following the occurrence of a change of control event, meaning that Mr. King Pak Fu and other permitted holders (as defined in the terms and conditions of the CB) beneficially own less than 30% of the total voting power of the voting stock of the Company or Mr. King Pak Fu ceases to be the chairman of the Board or an executive Director, any CB Holder will have the right, at such holder's option, to require the Company to redeem all but not some only of that holder's CB by not later than 30 days following a change of control event, or, if later, 30 days following the date upon which notice thereof is given to CB Holders by the Company. In each case of redemption above, the redemption amount shall be equal to the aggregate of (a) the aggregate principal amount of such outstanding CB held by the relevant CB Holder, (b) any accrued but unpaid interest on such outstanding CB on the relevant redemption date; and (c) (if the sum of the amounts referred to in (a) and (b) falls short of making up an internal rate of return (as defined in the terms and conditions of the CB) of 11% on the aggregate principal amount of its CB calculated from the date of first Closing until the relevant redemption date) such additional amount which would make up an internal rate of return of 11% on the aggregate principal amount of the CB calculated from the date of first Closing until the relevant redemption date. 11

12 Transferability The CB are freely transferable, subject to the terms and conditions of the CB. Events of default If any of the following events occurs the Trustee at its discretion may, and if so requested in writing by the CB Holders of not less than 25% in principal amount of the CB then outstanding, or if so directed by a resolution passed at a meeting duly convened and held in accordance with the terms of the Trust Deed by a majority of not less than 66⅔% of the votes cast, shall (subject in any such case to being indemnified and/or secured and/or prefunded to its satisfaction), give notice to the Company that the CB are, and they shall immediately become due and repayable at their redemption amount together with accrued but unpaid interest (if any) to the date of payment (subject as provided below and without prejudice to the right of CB Holders to exercise the conversion right in respect of their CB in accordance with the terms and conditions of the CB) if: 1) failure in the payment of any amount of principal, premium (if any), interest or any other amount in respect of or in connection with the CB by the Company or the Guarantor when the same becomes due; 2) failure in the delivery of Shares by the Company as and when the Shares are required to be delivered following conversion of the CB; 3) default in the performance of or observance of any term of any Transaction Document by the Company or the Guarantor, or of their respective other obligations under or in respect of the CB or any Transaction Document, or default in the performance of or observance of any terms of the Security Documents by any obligor under the Security Documents; 4) (a) any other present or future indebtedness of the Company or any of its subsidiaries or the Guarantor for or in respect of moneys borrowed or raised becoming (or becoming capable of being declared) due and payable prior to its stated maturity by reason of any default, event of default or the like (howsoever described), (b) failure to pay any such indebtedness when due or, as the case may be, within any applicable grace period, or (c) failure by the Company or any of its subsidiaries or the Guarantor to pay when due any amount payable by it under any present or future guarantee for, or indemnity in respect of, any moneys borrowed or raised, provided that the aggregate amount of the relevant indebtedness, guarantees and indemnities equals or exceeds US$20,000,000 or its equivalent; 12

13 5) any litigation, arbitration, administrative, governmental, regulatory or other investigations, proceedings or disputes being commenced or threatened against the Company, the Guarantor, any Group Company or the Chargors or any of their respective assets (or against the directors of the Company, any Group Company or any Chargor arising from their carrying out of duties as directors thereof) which are reasonably likely to adversely determined and, if so determined, could reasonably be expected to have a material adverse effect as defined in the terms and conditions of the CB; 6) an event having occurred which is, or which may with the taking of any step or the passage of time become, an insolvency event (as defined in the terms and conditions of the CB) in relation to the Company, the Guarantor any other Group Company or the Chargors; 7) (i) any of the Security becoming unlawful or ceasing to be legal, valid, binding or enforceable or otherwise ceases to be effective; (ii) any part of the Guarantee or the Security or any Security Interest created under the Security Documents not being (or being claimed by the Company, the Guarantor or any Chargor, as the case may be, not to be) in full force and effect, (iii) there being any purported termination of the Security or any Security Interest created under any of the Security Documents by the Company, the Guarantor or any Chargor, (iv) the Security created under any of the Security Documents failing to be or remain perfected, or (v) at any time, the CB Holders ceasing to have a first priority security interest in the Security or other Security Interest created under the Security Documents; 8) an order being made or an effective resolution being passed for the winding up, liquidation or dissolution, judicial management or administration of the Company, any Group Company or the Chargors; 9) failure to take action, etc. required in order (i) to enable the Company, the Guarantor and the Chargors lawfully to enter into, exercise their respective rights and perform and comply with their respective obligations under and in respect of the CB, the Transaction Documents or the Security Documents, (ii) to ensure that those obligations are legal, valid, binding and enforceable and (iii) to make the CB and Transaction Documents or the Security Documents admissible in evidence in the courts of the British Virgin Islands, Bermuda and/or Hong Kong; 10) it becoming unlawful for the Company, the Guarantor or the Chargors to perform or comply with any of their respective obligations under or in respect of the CB, Transaction Documents or the Security Documents; 13

14 11) (a) any step being lawfully taken by any competent governmental authority with a view to the seizure, compulsory acquisition, expropriation or nationalisation of all or substantially all of the assets of the Company, the Guarantor, any Group Company or any Chargor or (b) the Company, the Guarantor, any Group Company or any Chargor being prevented by any competent governmental authority from exercising normal control over all or substantially all of its property, assets and turnover; 12) there being a material breach of any applicable law (including the Listing Rules) by the Company, the Guarantor, any Group Company, the Chargors or any director or senior officers of the Company when acting for and on behalf of the Company; or 13) the Shares ceasing to be listed on the Stock Exchange or steps being taken by or on behalf of the Company to effect such cessation. Covenants The Company undertakes, among other things: 1) to use its best endeavours to maintain the listing of its issued Shares on the Stock Exchange; 2) to obtain and maintain the listing on the Stock Exchange of all Conversion Shares issued upon conversion of the CB; 3) to pay all the expenses in relation to the issue of and obtaining a listing for the Conversion Shares on the Stock Exchange; 4) to keep available and reserve, free from pre-emptive or other rights, out of its authorised but unissued ordinary Share capital, such number of Shares as would be required to be issued upon conversion of all the CB from time to time remaining outstanding and to satisfy in full all other rights of exercise, conversion into or exchange or subscription for Shares; 5) not to make any redemption, purchase or reduction of its ordinary Share capital or any uncalled liability in respect thereof or of any share premium account except, in each case, where the reduction is permitted by applicable law and results in (or would, but for the provision of the terms and conditions of the CB relating to rounding or the carry forward of adjustments, result in) an adjustment to the Conversion Price or is otherwise taken into account for the purposes of determining whether such an adjustment should be made provided always that the Company shall not be prohibited from purchasing its Shares to the extent permitted by law; 14

15 6) to comply in all material respects with all the rules, regulations and requirements of the Stock Exchange (including the Listing Rules); 7) not to in any way modify the rights attaching to the Shares with respect to voting, dividends or liquidation; 8) to obtain and maintain all necessary consents, licences, approvals, permits and authorisations required for the ownership and operation of its business unless the failure to obtain and maintain the same would not result in a material adverse effect (as defined in the terms and conditions of the CB) and shall comply with the terms thereof in all material respects; 9) not to make any offer, issue, grant or distribute or take any action the effect of which would be to reduce the Conversion Price below the par value of the Shares, provided always that the Company shall not be prohibited from purchasing its Shares to the extent permitted by law; 10) not to take any action which would result in an adjustment of the Conversion Price if, after giving effect thereto, the Conversion Price would be decreased to such an extent that the Shares to be issued on conversion of any CB could not, under any applicable law or the Listing Rules then in effect, be legally issued as fully-paid; 11) to ensure that all the Conversion Shares to be issued upon the conversion of all the CB shall be duly and validly issued as fully-paid, rank at least pari passu with all other Shares then outstanding and free and clear of all encumbrances; 12) it shall procure that the Guarantor will, execute, file and register such documents, instruments, agreements, certificates, assurances and do all such acts and things (including the payment of all fees, costs and charges) necessary to effect the delivery, filing and registration of the Guarantee as required by applicable law, in each case as soon as reasonably practicable and in any event no later than the applicable prescribed statutory time limits; 13) it shall, and it shall procure that each of the Chargors will, execute, file and register such documents, instruments, agreements, certificates, assurances and do all such acts and things (including the payment of all fees, costs and charges) necessary to effect the delivery, filing and registration of the Security Documents and for the perfection and protection of the security interests granted pursuant to the Security Documents as required by applicable law, including, without limitation, executing any transfer, conveyance, charge, mortgage, assignment or assurance of the charged assets, making any registration and giving any notice, order or direction, in each case as soon as reasonably practicable and in any event no later than the applicable prescribed statutory time limits; 15

16 14) the ratio of the consolidated total assets of the Group to the consolidated net assets of the Group as shown in the audited consolidated financial statements of the Company prepared and published by the Company annually shall not exceed four; and 15) the consolidated net assets of the Group as shown in the audited consolidated financial statements of the Company prepared and published by the Company annually shall be not less than HK$6,000,000,000, unless a resolution is passed at a meeting duly convened and held in accordance with the Trust Deed by a majority of not less than 66⅔% of the votes cast. Listing No application will be made for the listing of, and permission to deal in, the CB on the Stock Exchange or any other stock exchange. The Company will apply to the listing committee of the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares. REASONS FOR THE CB ISSUE AND THE USE OF PROCEEDS The Company is an investment holding company. The Group is principally engaged in theme based leisure and consumption business, focusing on the design, development and operation of integrated large-scale tourist complex projects in key cities in and outside the PRC that comprise of theme parks, hotels, shopping and leisure facilities, as well as other theme based consumption such as food and beverages, edutainment and touring theme parks. Assuming US$200,000,000 in principal amount of the CB is issued by the Company, the gross proceeds of the CB Issue will amount to US$200,000,000. The net proceeds of the CB Issue, after deducting commission and other related expenses payable by the Company, are estimated to be approximately US$195.7 million. Assuming US$300,000,000 in principal amount of the CB is issued by the Company, the gross proceeds of the CB Issue will amount to US$300,000,000. The net proceeds of the CB Issue, after deducting commission and other related expenses payable by the Company, are estimated to be approximately US$293.7 million. The Company intends to apply the net proceeds for general corporate purposes The Directors consider that the terms of the Placing Agreement and the transactions contemplated thereunder (including the CB Issue and the allotment and issue of the Conversion Shares) are on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole. 16

17 SHAREHOLDING STRUCTURE For illustration purposes only, the following table sets out the shareholding structure of the Company (a) as at the date of this announcement; and (b) immediately after the full conversion of the CB on the assumption that (i) there is no further allotment and issue or repurchase of the Shares; (ii) US$200,000,000 in principal amount of the CB is issued by the Company; (iii) US$300,000,000 in principal amount of the CB is issued by the Company; and (iv) there is full conversion of the CB at the initial Conversion Price of HK$1.39 per Share based on the agreed exchange rate of US$1 = HK$ As at the date of this announcement Number of Approx. Shares % Immediately after conversion of the CB in principal amount of US$200,000,000 based on the assumptions stated above Number of Approx. Shares % Immediately after conversion of the CB in principal amount of US$300,000,000 based on the assumptions stated above Number of Approx. Shares % Better Joint 6,125,279, ,125,279, ,125,279, Glory Merit 1,486,988, ,486,988, ,486,988, Elite Mile 2,031,482, ,031,482, ,031,482, Sino Wealthy 754,739, ,739, ,739, Sub-total: 10,398,491, ,398,491, ,398,491, CB Holders 0 0 1,115,827, ,673,741, Other public 3,740,392, ,740,392, ,740,392, Shareholders Sub-total: 3,740,392, ,856,219, ,414,133, Total: 14,138,884, ,254,711, ,812,625, Notes: 1. Better Joint Venture Limited ( Better Joint ) is the legal and beneficial owner of 6,125,279,787 Shares and holder of the convertible notes issued by the Company in the principal amount of HK$200 million due in 2016 which is convertible into a maximum of 743,494,423 Shares upon full conversion at the conversion price of HK$0.269 (subject to adjustment). Better Joint is wholly and beneficially owned by Mr. King Pak Fu, a substantial shareholder and director of the Company. 2. Glory Merit International Holdings Limited ( Glory Merit ) is the legal and beneficial owner of 1,486,988,846 Shares. Glory Merit is beneficially owned as to 99% by Mr. King Pak Fu. 17

18 3. Elite Mile Investments Limited ( Elite Mile ) is the legal and beneficial owner of 2,031,482,970 Shares. Elite Mile is wholly and beneficially owned by Mr. King Pak Fu. 4. Sino Wealthy Limited ( Sino Wealthy ) is the legal and beneficial owner of 754,739,800 Shares. Sino Wealthy is indirectly, wholly and beneficially owned by Forefront Group Limited. Forefront Group Limited is beneficially owned as to 70.71% by Mystery Idea Limited. Mystery Idea Limited is wholly and beneficially owned by Mr. King Pak Fu. EQUITY FUND RAISING ACTIVITIES IN THE PAST TWELVE MONTHS Save as disclosed below, the Company has not carried out any other capital raising activities during the 12 months immediately preceding the date of this announcement. The actual use of proceeds from the capital raising activities mentioned below is in line with the intended use of proceeds as disclosed in the respective announcements set out below. Date of announcement Fund raising activity Approximate net proceeds raised (HK$) Actual use of proceeds (as at 3 July 2015) 17 November 2014 Subscription for 220,000,000 new Shares completed on 26 November million Fully utilised as pledged bank deposit for bank and other borrowing 28 November 2014 and 1 December 2014 Subscription for 645,000,000 new Shares completed on 9 December million (i) approximately HK$514.9 million as pledged bank deposit for bank and other borrowing; (ii) approximately HK$ million as for our investment in securities, kids edutainment and touring carnival projects and professional fees on our project investments; and (iii) approximately HK$35.9 million as payment of bond interest 18

19 4 June 2015 Subscription for 360,000,000 new Shares completed on 12 June million Approximately HK$389.2 million as pledged bank deposit for bank and other borrowing GENERAL The Conversion Shares will be allotted and issued under the General Mandate granted to the Directors at the annual general meeting of the Company held on 28 April Under the General Mandate, a maximum of 2,755,776,809 new Shares may fall to be allotted and issued. The Company issued 360,000,000 Shares under the General Mandate pursuant to a placing agreement entered into by the Company and the placing agents, the details of which are set out in the announcement of the Company on 4 June Save for such issue, the General Mandate has not been otherwise utilised prior to the date of this announcement. As such, the General Mandate will be sufficient for, and no further Shareholders approval is required for, the allotment and issue of the Conversion Shares. An application will be made to the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares to be issued upon the exercise of the conversion rights attaching to the CB. Completion of the CB Issue is subject to fulfillment, and/or waiver, of certain conditions stated in the Placing Agreement. In addition, the Placing Agreement may be terminated upon the occurrence of certain events. Please refer to the section headed The Placing Agreement in this announcement for further information. As the CB Issue may or may not be completed, Shareholders and prospective investors are reminded to exercise caution when dealing in the Shares. DEFINITIONS In this announcement, the following expressions have the meanings set out below unless the context requires otherwise: Agency Agreement Board a paying, conversion and transfer agency agreement to be entered into between the Company, the Chargors, the Trustee and other parties named therein the board of Directors 19

20 Business Day CB CB Holders CB Issue Chargors China Minsheng Closing Closing Date Company Composite Share Charge connected person(s) a day on which commercial banks and foreign exchange markets settle payments in Hong Kong, excluding any day in Hong Kong on which a typhoon signal number 8 or above or a black rainstorm warning is hoisted 8% secured convertible bonds due 2018 of the Company in principal amount of up to US$200,000,000 (or up to US$300,000,000 if the Option is exercised) holders of the CB the issue of the CB by the Company the Company and two other subsidiaries of the Company China Minsheng Banking Corp., Ltd. Hong Kong Branch, the lead manager in respect of the CB Issue a closing of the subscription for and issue of the CB in accordance with the terms and conditions of the Placing Agreement the date of the first Closing, the second Closing or the third Closing (as the case may be) as set out in the section headed Closings in this announcement Carnival Group International Holdings Limited, a company incorporated in Bermuda with limited liability and the Shares of which are listed on the main board of the Stock Exchange the share charge to be granted by the Chargors in favour of the Security Trustee for the benefit of itself and the Secured Parties over certain subsidiaries of the Company has the meaning ascribed to it under the Listing Rules 20