Beijing Urban Construction Design & Development Group Co., Limited — Proxy Solicitation & Information Statement 2006

Jun 22, 2006

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in China Overseas Land & Investment Ltd. (the “ Company ”), you should at once hand this circular and the accompanying form of proxy to the purchaser, transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

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(incorporated in Hong Kong with limited liability)

(Stock Code: 688)

NON-EXEMPT CONTINUING CONNECTED TRANSACTION IN RESPECT OF ENGAGEMENT BY COLI GROUP OF CSCEC GROUP AS CONSTRUCTION CONTRACTOR SUBJECT TO SUCCESSFUL TENDER AND NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent financial adviser to the Independent Board Committee and the Independent Shareholders

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A letter from the Board is set out on pages 4 to 8 of this circular and a letter from the Independent Board Committee is set out on pages 9 to 10 of this circular. A letter from Access Capital, the independent financial adviser to the Independent Board Committee and COLI Independent Shareholders, containing its advice to the Independent Board Committee and COLI Independent Shareholders is set out on pages 11 to 18 of this circular.

A notice convening the extraordinary general meeting to be held at 11/F., Three Pacific Place, 1 Queen’s Road East, Hong Kong on Wednesday, 12 July 2006 immediately following the conclusion of the extraordinary general meeting which is scheduled to be held at 3:00 p.m. is set out on pages 31 to 32 of this circular. Whether or not you are able to attend the extraordinary general meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the registrar of the Company, Standard Registrars Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong, as soon as possible and in any event not less than 48 hours before the appointed time for the holding of the meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting and any adjourned meeting (as the case may be) should you so wish.

22 June 2006

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
Letter from Access Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
Appendix I — General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Appendix II — Procedures for voting by poll at general meeting . . . . . . . . . . . . . . . . . .	30
Notice of Extraordinary General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31

— i —

DEFINITIONS

In this circular, the following expressions shall have the meanings set out below unless the context requires otherwise:

• “Access Capital”

Access Capital Limited, the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Continuing Connected Transaction, and a licensed corporation for type 1 (dealing in securities), type 4 (advising on securities), type 6 (advising on corporate finance) and type 9 (asset management) regulated activities under the SFO

• “associate(s)” or “connected have the meanings ascribed to them respectively under the person(s)” Listing Rules

• “Board” the board of directors of the Company

“CCE Macau” China Construction Engineering (Macau) Company Limited, a wholly-owned subsidiary of COHL

“CCE Macau Engagement the engagement agreement entered into between the Company Agreement” and CCE Macau on 22 November 2005 in respect of the engagement by the Group of CCE Macau as construction contractor for the Group in Macau, details of the agreement are set in the announcement jointly issued by the Company and China State Construction on 22 November 2005 and the Company’s circular dated 12 December 2005

• “China State Construction” China State Construction International Holdings Limited ( ), a company incorporated in the Cayman Islands with limited liability

• “COHL” China Overseas Holdings Limited ( ), a company incorporated in Hong Kong, which is interested, directly and indirectly, in approximately 50.4% of the issued share capital of the Company

• “COLI” or “Company” China Overseas Land & Investment Ltd. ( ), a company incorporated in Hong Kong with limited liability

• “COLI Group” or “Group” the Company and its subsidiaries “Continuing Connected the transaction as contemplated under the CSCEC Group Transaction” Engagement Agreement

— 1 —

DEFINITIONS

“CSC Engagement Agreement”	the engagement agreement entered into between the Company
	and China State Construction on 22 November 2005 in respect
	of the engagement by the Group of CSC Group as
	construction contractor for the Group in Hong Kong, details
	of the agreement are set out in the announcement jointly
	issued by the Company and China State Construction on 22
	November 2005 and the Company’s circular dated 12
	December 2005
“CSC Group” “CSCEC”	China State Construction and its subsidiaries (China State Construction Engineering
	Corporation), a state-owned corporation organised and
	existing under the laws of the PRC, being the ultimate
	controlling shareholder of the Company
“CSCEC Group”	CSCEC and its subsidiaries, other than SCOCE, CCE Macau,
	China State Construction and their respective subsidiaries
“CSCEC Group Engagement	the engagement agreement entered into between the Company
Agreement”	and CSCEC on 7 June 2006 in respect of the engagement by
	the Group of CSCEC Group as construction contractor for the
	Group in the PRC, details of the agreement are set out in this
	circular
“Directors”	the directors of the Company
“EGM”	the extraordinary general meeting of the Company to be held
	for approving the Continuing Connected Transaction, the
	notice of which is set out at the end of this circular
“Hong Kong”	Hong Kong Special Administrative Region of the PRC
“Independent Board Committee”	the committee of the Board, consisting of Dr. Li Kwok Po,
	David, Mr. Lam Kwong Siu and Mr. Wong Ying Ho, Kennedy,
	all being independent non-executive directors
“Independent Shareholders”	the shareholders of the Company, other than CSCEC, COHL,
	China State Construction and their respective associates (as
	defined under the Listing Rules)
“Latest Practicable Date”	19 June 2006, being the latest practicable date for
	ascertaining certain information for inclusion into this
	circular
“Listing Rules”	The Rules Governing the Listing of Securities on the Stock
	Exchange
“Macau”	Macao Special Administrative Region of the PRC

— 2 —

DEFINITIONS

“PRC”	the People’s Republic of China, which for the purpose of this
	circular exclude Hong Kong and Macau
“SCOCE”	(Shenzhen China Overseas Construction
	Engineering Company), a wholly owned subsidiary of CSCEC
“SCOCE Engagement Agreement”	the engagement agreement entered into between the Company
	and SCOCE on 22 November 2005 in respect of the
	engagement by the Group of SCOCE as construction
	contractor for the Group in the PRC, details of the agreement
	are set out in the announcement jointly issued by the
	Company and China State Construction on 22 November 2005
	and the Company’s circular dated 12 December 2005
“SFO”	the Securities and Futures Ordinance (Chapter 571 of the
	Laws of Hong Kong)
“Shareholders”	the shareholders of the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“%”	per cent.

Conversion of RMB to HK$ is based on the exchange rate of (i) RMB1.06 = HK$1.00 for any financial period ending on or before 21 July 2005 and any dates falling within such period; and (ii) RMB1.04 = HK$1.00 for any financial period commencing after 21 July 2005 and any dates falling within such period.

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LETTER FROM THE BOARD

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(incorporated in Hong Kong with limited liability)

(Stock Code: 688)

Executive Directors:

Mr. Kong Qingping (Chairman and Chief Executive) Mr. Cui Duosheng (Vice Chairman) Mr. Yao Peifu (Vice Chairman)

Registered Office: 10/F, Three Pacific Place, 1 Queen’s Road East, Hong Kong

Mr. Hao Jian Min Mr. Wu Jianbin Mr. Xiao Xiao Mr. Jin Xinzhong Mr. Wang Man Kwan, Paul

Non-executive Director:

Mr. Cheung Shiu Kit

Independent Non-executive Directors:

Dr. Li Kwok Po, David Mr. Lam Kwong Siu

Mr. Wong Ying Ho, Kennedy

22 June 2006

To the Shareholders

Dear Sir or Madam,

NON-EXEMPT CONTINUING CONNECTED TRANSACTION IN RESPECT OF ENGAGEMENT BY COLI GROUP OF CSCEC GROUP AS CONSTRUCTION CONTRACTOR SUBJECT TO SUCCESSFUL TENDER AND NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

The Directors announced that on 7 June 2006, the Company entered into a CSCEC Group Engagement Agreement with CSCEC, whereby the Group may engage CSCEC Group as construction contractor in the PRC upon successful tender for each of the following three financial years from 2006 to 2008 subject to the Cap. CSCEC Group has not undertaken any construction projects for the Group in the past three years.

— 4 —

LETTER FROM THE BOARD

CSCEC is the ultimate holding company of the Company. As at the Latest Practicable Date, CSCEC, through its wholly-owned subsidiary, COHL, holds approximately 50.4% of the issued share capital of the Company. Accordingly, members of CSCEC Group are connected persons of the Company.

The engagement by the Group of CSCEC Group as construction contractor upon successful tender constitutes non-exempt continuing connected transaction of the Company.

The purpose of this circular is to provide you with

• the particulars of the CSCEC Group Engagement Agreement (together with the Cap);

• the letter from the Independent Board Committee with their view on the Continuing Connected Transaction and the CSCEC Group Engagement Agreement (together with the Cap); and

• the letter from the independent financial adviser with their advice on the Continuing Connected Transaction and the CSCEC Group Engagement Agreement (together with the Cap) to the Independent Board Committee and the Independent Shareholders,

as well as to seek the approval of the Independent Shareholders.

A. CONTINUING CONNECTED TRANSACTION

The Directors expect that the Group will invite CSCEC Group to participate in competitive tender for the Group’s construction works in the PRC from time to time. In this connection, on 7 June 2006, the Company entered into the CSCEC Group Engagement Agreement for a term of not more than 3 financial years commencing from 7 June 2006 and expiring on 31 December 2008 whereby the parties agreed that:

• (a) CSCEC Group may tender for the Group’s construction works in the PRC in accordance with the tendering procedure of the Group from time to time and on the same and normal terms as offered to other independent third party construction contractors; and

• (b) if any contract is granted in favour of CSCEC Group as a result of the above tender, CSCEC Group may act as construction contractor for the Group in the PRC based on the terms of the successful tender provided that the total contract sum to be awarded by the Group to CSCEC Group each year shall not exceed HK$1,600 million, for each of the three financial years ending 31 December 2008 (the “ Cap ”).

The Cap is calculated with reference to the following factors:

• (i) total contract sum of new construction projects in the PRC of the Group in each of the past three years ended 31 December 2005 of approximately HK$1,378 million, HK$3,216 million and HK$3,802 million respectively; and

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LETTER FROM THE BOARD

• (ii) total contract sum of new construction projects in the PRC of the Group in each of the next three financial years ending 31 December 2008 estimated with reference to the Group’s future growth and expansion in its land reserves in the PRC in the next three years.

The CSCEC Group Engagement Agreement (together with the Cap) will take effect conditional upon the Independent Shareholders’ approval having been obtained at the EGM.

B. REASON FOR AND BENEFIT OF THE CONTINUING CONNECTED TRANSACTION

In November 2005, the Company entered into various master agreements, namely, the SCOCE Engagement Agreement with SCOCE, the CCE Macau Engagement Agreement with CCE Macau and the CSC Engagement Agreement with China State Construction, which served as the basis for the Company to award construction contracts to these connected persons in compliance with the connected transaction requirements under the Listing Rules. On 29 December 2005, the Independent Shareholders approved the caps for the CSC Engagement Agreement, the CCE Macau Engagement Agreement and the SCOCE Engagement Agreement, respectively, in the amount of HK$900 million, HK$200 million and HK$1,600 million, respectively. CSCEC is a PRC state-owned enterprise, and has a vast network of construction subsidiaries in the PRC. The CSCEC Group Engagement Agreement may, in addition to the SCOCE Engagement Agreement, the CCE Macau Engagement Agreement and the CSC Engagement Agreement, provides the Company with the option to engage CSCEC Group (subject to successful tender) as construction contractor in the construction of its property development projects in the PRC.

The Directors (other than the independent non-executive directors of the Company whose views has been set out in this circular to be despatched to the Shareholders together with the opinion of the independent financial adviser who has been appointed in advising them) confirm that the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of the Group, and the CSCEC Group Engagement Agreement (together with the Cap), was agreed on normal commercial terms after arm’s length negotiations between the parties, and the terms of the Continuing Connected Transaction (together with the Cap) were fair and reasonable and in the interests of the Shareholders as a whole.

The Shareholders should note that the Cap represents the best estimates by the Directors of the amount of the relevant transaction based on the information currently available. The Cap bears no direct relationships to, nor should be taken to have any direct bearings to, the Group’s financial or potential financial performance. The Group may or may not retain CSCEC Group to engage in construction works up to the level of the Cap, if at all, as its engagement is subject to tender procedures which are open to other independent third party contractors.

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LETTER FROM THE BOARD

C. PRINCIPAL BUSINESS OF THE GROUP AND CONNECTION BETWEEN THE PARTIES

The Group mainly engages in property development and investment project management, infrastructure project investments, investment holding, real estate agency and management and treasury operations. It engages contractors to construct its property projects in the PRC, Hong Kong and Macau.

CSCEC is the ultimate holding company of the Company. As at the Latest Practicable Date, CSCEC, through its wholly-owned subsidiary, COHL, holds approximately 50.4% of the issued share capital of the Company. Accordingly, members of CSCEC Group are connected persons of the Company.

D. LISTING RULES IMPLICATIONS

The applicable percentage ratios as defined under Rule 14A.10 of the Listing Rules calculated for the Company in respect of the total contract sum that may be awarded under the CSCEC Group Engagement Agreement, i.e. the Cap, exceeds 2.5%. Accordingly, the engagement by the Group of CSCEC Group as construction contractor for its construction works under the CSCEC Group Engagement Agreement constitutes non-exempt continuing connected transaction of the Company. As such, the Company is required to comply with the annual review, reporting, announcement and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the Continuing Connected Transaction. CSCEC and its associates (as defined under the Listing Rules and including COHL) shall abstain from voting at the EGM.

E. EXTRAORDINARY GENERAL MEETING

The notice convening the EGM to be held at 11/F., Three Pacific Place, 1 Queen’s Road East, Hong Kong on Wednesday, 12 July 2006 immediately following the conclusion of the extraordinary general meeting which is scheduled to be held at 3:00 p.m. at which ordinary resolutions will be proposed to approve the Continuing Connected Transactions is set out on pages 31 to 32 of this circular.

A form of proxy for use at the EGM is enclosed. Whether or not you are able to attend the meeting, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon to the office of the registrar of the Company, Standard Registrars Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong, as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting and any adjourned meeting (as the case may be) should you so wish.

The procedures for voting by poll by the Shareholders are set out in Appendix II to this circular.

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LETTER FROM THE BOARD

F. RECOMMENDATION

The Directors consider that the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of COLI Group and the CSCEC Group Engagement Agreement (together with the Cap), was agreed on normal commercial terms and was fair and reasonable and in the interests of the Company and the Shareholders as a whole, and recommend the Independent Shareholders to vote in favour of the ordinary resolutions to be proposed at the EGM.

Your attention is drawn to the letter from the Independent Board Committee set out on pages 9 to 10 of this circular which contains its recommendation to the Independent Shareholders on the Continuing Connected Transaction and the CSCEC Group Engagement Agreement (together with the Cap). Your attention is also drawn to the letter of advice received from Access Capital which contains its advice to the Independent Board Committee and the Independent Shareholders in relation to the Continuing Connected Transaction and the CSCEC Group Engagement Agreement (together with the Cap). The letter from Access Capital is set out on pages 11 to 18 of this circular.

Your attention is also drawn to the general information set out in Appendix I to this circular.

Yours faithfully, By Order of the Board China Overseas Land & Investment Ltd. Kong Qingping

Chairman and Chief Executive

— 8 —

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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(incorporated in Hong Kong with limited liability)

(Stock Code: 688)

22 June 2006

To the Independent Shareholders

Dear Sir or Madam,

NON-EXEMPT CONTINUING CONNECTED TRANSACTION IN RESPECT OF ENGAGEMENT BY COLI GROUP OF CSCEC GROUP AS CONSTRUCTION CONTRACTOR SUBJECT TO SUCCESSFUL TENDER AND NOTICE OF EXTRAORDINARY GENERAL MEETING

We refer to the circular dated 22 June 2006 of the Company (the “ Circular ”) of which this letter forms part. Terms defined in the Circular bear the same meanings herein unless the context otherwise requires.

We have been appointed to form the Independent Board Committee to consider the Continuing Connected Transactions and the CSCEC Group Engagement Agreement (together with the Cap) and to advise the Independent Shareholders whether, in our opinion, the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of COLI Group and the CSCEC Group Engagement Agreement (together with the Cap) was agreed on normal commercial terms and was fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Access Capital has been appointed to advise the Independent Board Committee and the Independent Shareholders whether the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of COLI Group and the CSCEC Group Engagement Agreement (together with the Cap) was agreed on normal commercial terms and was fair and reasonable and in the interests of the Company and the Shareholders as a whole.

We wish to draw your attention to the letter from the Board set out on pages 4 to 8 of the Circular which contains information about CSCEC Group Engagement Agreement and the letter of advice from Access Capital set out on pages 11 to 18 of the Circular which contains advice in respect of the Continuing Connected Transaction and the CSCEC Group Engagement Agreement (together with the Cap).

— 9 —

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having taken into account of the advice of Access Capital, we consider that the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of COLI Group and the CSCEC Group Engagement Agreement (together with the Cap) was agreed on normal commercial terms and were fair and reasonable and in the interests of the Company and the Shareholders as a whole, and recommend the Independent Shareholders to vote in favour of the ordinary resolutions as set out in the notice of the EGM to be held on 12 July 2006.

Yours faithfully,

For and on behalf of Independent Board Committee of China Overseas Land & Investment Ltd.

Li Kwok Po, David Lam Kwong Siu Independent Non-executive Independent Non-executive Director Director

Wong Ying Ho, Kennedy Independent Non-executive Director

— 10 —

LETTER FROM ACCESS CAPITAL

The following is the full text of the letter of advice to the Independent Board Committee and the Independent Shareholders from Access Capital prepared for incorporation in this circular.

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Suite 606

6th Floor Bank of America Tower 12 Harcourt Road Central Hong Kong

22 June 2006

To: The Independent Board Committee and the Independent Shareholders of China Overseas Land & Investment Ltd.

Dear Sir or Madam,

NON-EXEMPT CONTINUING CONNECTED TRANSACTION

1. INTRODUCTION

We refer to our appointment to advise the Independent Board Committee and the Independent Shareholders with regard to the terms of the Continuing Connected Transaction. Details of the Continuing Connected Transaction are contained in the “Letter from the Board” of the circular to the Shareholders dated 22 June 2006 (the “Circular”) of which this letter forms part. Terms used in this letter shall have the same meanings as those defined in the Circular, unless the context otherwise specifies.

Pursuant to the CSCEC Group Engagement Agreement, the Group may engage CSCEC Group as construction contractor in the PRC upon successful tender for each of the following three financial years from 2006 to 2008 subject to the Cap.

CSCEC is a PRC state-owned enterprise, and has a vast network of construction subsidiaries in the PRC.

— 11 —

LETTER FROM ACCESS CAPITAL

Set out below is our understanding of the shareholding structure of CSCEC and the Company:

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----- Start of picture text -----

CSCEC
100%
COHL
50.4%
the Company
----- End of picture text -----

In view of the above shareholding structure, CSCEC is the ultimate holding company of the Company. As at the Latest Practicable Date, CSCEC, through its wholly-owned subsidiary, COHL, holds approximately 50.4% of the issued share capital of the Company. Accordingly, members of CSCEC Group are connected persons of the Company and the engagement by the Group of CSCEC Group as construction contractors upon successful tender constitutes non-exempt continuing connected transaction of the Company.

According to the Company, the applicable percentage ratios as defined under Rule 14A.10 of the Listing Rules calculated for the Company in respect of the total contract sum that may be awarded under the CSCEC Group Engagement Agreement, i.e. the Cap, exceeds 2.5%. As such, the Company is required to comply with the annual review, reporting, announcement and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the Continuing Connected Transaction. CSCEC, COHL, China State Construction and their respective associates (as defined under the Listing Rules) shall abstain from voting at the EGM.

2. THE INDEPENDENT BOARD COMMITTEE

An independent board committee, comprising Dr. Li Kwok Po, David, Mr. Lam Kwong Siu and Mr. Wong Ying Ho, Kennedy (all of whom are independent non-executive Directors), has been established to consider the terms of the Continuing Connected Transaction and the Cap and to advise the Independent Shareholders thereon.

We have been appointed by the Independent Board Committee to advise them as to whether the CSCEC Group Engagement Agreement (together with the Cap) and the Continuing Connected Transaction were agreed on normal commercial terms and were fair and reasonable so far as the Independent Shareholders are concerned, and in the interests of the Company and the Shareholders as a whole and to give our opinion in relation to the terms of the Continuing Connected Transaction and the Cap for their consideration when making their recommendation to the Independent Shareholders.

3. BASIS OF THE OPINION

In formulating our advice, we have relied solely on the statements, information, opinions and representations contained in the Circular and the information and representations provided and/or

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LETTER FROM ACCESS CAPITAL

made to us by the Company and/or the Directors and/or the senior management of the Company. We have assumed that all such statements, information, opinions and representations contained or referred to in the Circular or otherwise provided or made or given by the Company and/or the Directors and/or the senior management of the Company and for which it is/they are solely responsible were true, accurate and valid at the time they were made and given and continue to be true, accurate and valid as at the date of the Circular. We have assumed that all the statements, information, opinions and representations made or provided by the Company and/or the Directors and/or the senior management of the Company contained in the Circular have been reasonably made after due and careful enquiry. We have also sought and obtained confirmation from the Company and/or the Directors and/or the senior management of the Company that no material facts have been omitted from the information provided and referred to in the Circular.

We consider that we have reviewed all currently available information and documents to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our opinion. We have no reason to doubt the truth, accuracy and completeness of the statements, information, opinions and representations provided to us by the Company, the Directors, the senior management of the Company and their respective advisers or to believe that material information has been withheld or omitted from the information provided to us or referred to in the aforesaid documents. We have not, however, carried out an independent verification of the information provided, nor have we conducted an independent investigation into the business and affairs of the Company or any of its subsidiaries.

4. PRINCIPAL FACTORS AND REASONS CONSIDERED

In forming our opinion, we have taken into consideration the following principal factors and reasons:

4.1 Principal business of the Group

The Group is mainly engaged in property development and investment project management, infrastructure project investments, investment holding, real estate agency and management and treasury operations. It engages contractors to construct its property projects in the PRC, Hong Kong and Macau.

4.2 Overall financial performance of the Group

Historical financial results

For the past two years ended 31 December 2005, the Group has recorded audited turnover of approximately HK$5,307.7 million (2004) (restated) and HK$6,971.3 million (2005); and audited net profit attributable to equity holders of approximately HK$1,073.6 million (2004) (restated) and HK$1,534.7 million (2005). As at 31 December 2005, the audited consolidated net tangible assets of the Group amounted to approximately HK$10,938.0 million.

— 13 —

LETTER FROM ACCESS CAPITAL

Although the Group’s audited turnover increased steadily over the last two financial years, the audited net profit attributable to Shareholders demonstrates even higher growth during the same period. As stated in the Company’s 2005 annual report, the Group underwent an overall consolidation of the businesses, focusing its resources on the development of property business in the PRC which attained robust growth with rapid rise in profit.

In May 2005, the Group has successfully received the Baa3 and BBB- ratings from Moody and Standard and Poor’s respectively, making it the pioneer among the domestic property developers for being granted two investment credit ratings.

Prospects

As stated in the Company’s annual report for the year ended 31 December 2005, the Director have noted whilst there were some uncertainties and increasing international competition, the global economy will maintain a steady growth.

Given the encouraging domestic demand in the PRC through increasing affluence of the people and general improvement of living standard, upgrade of consumption and growth of disposable income, coupled with accelerating urbanisation, the Directors believe that the development of the property industry will be well positioned to benefit from this economical trend.

In addition, whilst the PRC government implemented policies to monitor investment in property investment and regulate land supply, including measures to stabilise property price, rationalise property supply structure and encourage rational consumption, the Directors consider that the measures help to develop a healthy, rational and sustain the development of the property market, which will be beneficial the Group as a whole.

We understand from the Company that it remains the Company’s corporate strategy to focus on investment in the PRC’s property market, with the ultimate objective of becoming one of the best nationwide property developers.

4.3 Background to and reasons for the Continuing Connected Transaction

In November 2005, the Company entered into various master agreements, namely, the SCOCE Engagement Agreement with SCOCE, the CCE Macau Engagement Agreement with CCE Macau and the CSC Engagement Agreement with China State Construction, which served as the basis for the Company to award construction contracts to these connected persons in compliance with the connected transaction requirements under the Listing Rules. On 29 December 2005, the Shareholders approved the caps for the CSC Engagement Agreement, the CCE Macau Engagement Agreement and the SCOCE Engagement Agreement, respectively, in the amount of HK$900 million, HK$200 million and HK$1,600 million, respectively.

CSCEC is a PRC state-owned enterprise, and has a vast network of construction subsidiaries in the PRC. The CSCEC Group Engagement Agreement may, in addition to the SCOCE Engagement Agreement, the CCE Macau Engagement Agreement and the CSC Engagement Agreement, provide the Company with the option to engage CSCEC Group (subject to successful tender) as construction contractor in the construction of its property development projects in the PRC.

— 14 —

LETTER FROM ACCESS CAPITAL

The Directors expect that the Group will, in the ordinary and usual course of its business, continues to invite CSCEC Group to participate in competitive tender for the Group’s construction works in the PRC from time to time. The Directors consider that through engaging CSCEC Group as potential construction contractor, it would allow the Company to broaden its access to a greater number of qualifying contractors, so as to allow the Company more choices in the award of its tenders to firms to participate in the construction of its property development projects in the PRC.

Having considered the reasons mentioned above, the abovementioned principal business of the Group and its recent financial performance, we concur with the view of the Directors and are of the view that it is reasonable for the Company to enter into the CSCEC Group Engagement Agreement and the Continuing Connected Transaction as contemplated under the CSCEC Group Engagement Agreement is expected to be entered into in the ordinary and usual course of business of the Group.

4.4 Terms of the Continuing Connected Transaction

As stated in the “Letter from the Board”, the Directors expect that the Group will invite CSCEC Group to participate in competitive tender for the Group’s construction works in the PRC from time to time.

On 7 June 2006, the Company entered into the CSCEC Group Engagement Agreement for a term of not more than 3 financial years commencing from 7 June 2006 and expiring on 31 December 2008 whereby the parties agreed that:

• (a) CSCEC Group may tender for the Group’s construction works in the PRC in accordance with the tendering procedure of the Group from time to time and on the same and normal terms as offered to other independent third party construction contractors; and

• (b) if any contract is granted in favour of CSCEC Group as a result of the above tender, CSCEC Group may act as construction contractor for the Group in the PRC based on the terms of the successful tender provided that the total contract sum to be awarded by the Group to CSCEC Group each year shall not exceed HK$1,600 million, for each of the three financial years ending 31 December 2008.

The CSCEC Group Engagement Agreement (together with the Cap) will take effect conditional upon the Independent Shareholders’ approval having been obtained at the EGM.

The Directors confirm that the Continuing Connected Transaction is expected to be entered into in the ordinary and usual course of business of the Group, and the CSCEC Group Engagement Agreement (together with the Cap), was agreed on normal commercial terms after arm’s length negotiations between the parties, and the terms of the Continuing Connected Transaction (together with the Cap) were fair and reasonable and in the interests of the Company and the Shareholders as a whole.

We have discussed with the senior management of the Company about the normal tendering procedures for construction projects of the Group (between the Group and independent third party construction contractors) with contract sum range between HK$50 million to HK$4,000 million. As

— 15 —

LETTER FROM ACCESS CAPITAL

the Group is an experienced property developer and engaged various construction contractors to construct its projects in the PRC, Hong Kong and Macau with contract sum in the abovementioned range, we therefore believed that construction projects covering contract sum range between HK$50 million to HK$4,000 million provide a fair and representative spectrum for us to consider the tendering procedures for construction projects of the Group. We understand that the construction contracts were awarded (i) through a competitive tender process in accordance with the tendering procedures laid down by the Group from time to time; and (ii) the decision to award a construction contract to selected contractor(s) depends on the recommendation of the independent architectural firm or qualified surveyor who has reviewed and considered the following factors of the selected construction contractor, in particular, its past experience, its financial track record and the latest available financial position, and the estimated cost of the construction project. Based on the aforesaid, we are of the view that by entering into the CSCEC Group Engagement Agreement help to formalise the arrangement to engage members of the CSCEC Group as construction contractors in the future and quantify the maximum amount of projects which may be awarded by the Group to CSCEC Group in the next three financial year ending 31 December 2008, which is beneficial to the Company and is in the interests of the Company and the Shareholders as a whole. In addition, we concur with the Directors and are of the view that the CSCEC Group Engagement Agreement may, in addition to the SCOCE Engagement Agreement, the CCE Macau Engagement Agreement and the CSC Engagement Agreement, provide the Company with the option to engage CSCEC Group (subject to successful tender) as construction contractor in the construction of its property development projects in the PRC.

4.5 Commercial justification for determining the Cap in relation to the Continuing Connected Transaction

As stated in the “Letter from the Board”, the Cap will be the total contract sum to be awarded by the Group to CSCEC Group each year shall not exceed HK$1,600 million, for each of the three financial years ending 31 December 2008.

Also stated in the “Letter from the Board”, the Cap is calculated with reference to the following factors:

• (i) total contract sum of new construction projects in the PRC of the Group in each of the past three years ended 31 December 2005 of approximately HK$1,378 million, HK$3,216 million and HK$3,802 million respectively; and

• (ii) total contract sum of new construction projects in the PRC of the Group in each of the next three financial years ending 31 December 2008 estimated with reference to the Group’s future growth and expansion in its land reserves in the PRC in the next three years.

Shareholders should note that the Cap represents the best estimates by the Directors of the amount of the relevant transactions based on the information currently available. According to the Company, such estimates bear no direct relationships to, nor should be taken to have any direct bearings to, the Group’s financial or potential financial performance. The Group may or may not retain CSCEC Group to engage in construction works up to the level of the Cap, if at all, as its engagement is subject to tender procedures which are open to other independent third party contractors.

— 16 —

LETTER FROM ACCESS CAPITAL

Having taken into account the total contract sum of construction projects in the PRC of the Group in the past as described above; the Directors estimate the total contract sum of new construction projects in the PRC in each of the three financial years ending 31 December 2008 with reference to the Group’s future growth and expansion in its land reserves in the PRC in the next three years.

We have discussed with the senior management of the Group and also noted from the annual report of the Group for the year ended 31 December 2005, the Group had a total land reserve of 10.75 million square meters as at 31 December 2005 to be developed in the near future and under development. Also according to the Company, the existing land reserve of the Group is sufficient to support its development in the coming three to four years and is expanding at the target rate of over 20% per year. On this basis, we are of the view that it is fair and reasonable for the Directors to estimate the total contract sum of new construction projects in the PRC in each of the three financial years ending 31 December 2008 with reference to the Group’s future growth and expansion in its land reserves in the PRC in the next three years.

We have also noted (i) the prospects of the Group which indicates the growth potential in the property markets in the PRC; and (ii) the long-term business strategy of the Group which is to focus on investment in the property market, in particular, the PRC, with the ultimate objective of becoming one of the best nationwide property developers.

On the basis of the aforesaid reasons and factors, we concur with the view of the Directors and are of the view that the Cap for each of the three financial years ending 31 December 2008 is fair and reasonable. Accordingly, we consider that the Continuing Connected Transaction as contemplated under the CSCEC Group Engagement Agreement are expected to be entered into in the ordinary and usual course of business of the Group and the terms of CSCEC Group Engagement Agreement (together with the Cap) were agreed on normal commercial terms and are fair and reasonable so far as the Shareholders are concerned and in the interests of the Company and its Shareholders as a whole.

5. RECOMMENDATIONS

In considering the terms of the Continuing Connected Transaction, we have taken into account the following factors:

• the background to and reasons for the Continuing Connected Transaction as described above, which indicates that it is reasonable for the Company to enter into the CSCEC Group Engagement Agreement;

• the terms of the Continuing Connected Transaction as described above, which indicates that by entering into the CSCEC Group Engagement Agreement helps to formalise the arrangement to engage CSCEC Group as construction contractor in the future and quantify the maximum amount of projects which may be awarded by the Group to these connected persons in the next three financial year ending 31 December 2008, and provides the Company with an additional option to engage CSCEC Group (subject to successful tender) as construction contractor in the construction of its property development projects in the PRC, which is beneficial to the Company and is in the interests of the Company and the Shareholders as a whole; and

— 17 —

LETTER FROM ACCESS CAPITAL

• the commercial justification for determining the relevant caps in relation to the Continuing Connected Transaction as described above; which indicates that the basis of determining the Cap for the Continuing Connected Transaction is fair and reasonable so far as the Shareholders are concerned and is in the interests of the Company and its Shareholders as a whole.

After having considered the above principal factors and based on the information provided and the representations made to us, we consider the Continuing Connected Transaction as contemplated under the CSCEC Group Engagement Agreement is expected to be entered into in the ordinary and usual course of business of the Group, the terms of the CSCEC Group Engagement Agreement and the Cap to be fair and reasonable so far as the COLI Independent Shareholders are concerned; and that the CSCEC Group Engagement Agreement and the Cap are in the interests of the Company and the COLI Independent Shareholders as a whole. Accordingly, we advise the Independent Board Committee to recommend to the Independent Shareholders to vote in favour of the relevant resolution which will be proposed at the EGM to approve the CSCEC Group Engagement Agreement (together with the Cap).

Yours faithfully, For and on behalf of Access Capital Limited Jeanny Leung Managing Director

— 18 —

GENERAL INFORMATION

APPENDIX I

1. RESPONSIBILITY STATEMENT

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

2. DISCLOSURE OF INTERESTS BY DIRECTORS AND CHIEF EXECUTIVE

As at the Latest Practicable Date, the interests and short positions of the Directors and the chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporation (within the meaning of Part XV of the SFO) which (a) 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 and short positions which they are taken or deemed to have under such provisions of the SFO); or (b) were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein; or (c) were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies of the Listing Rules, to be notified to the Company and the Stock Exchange were as follows:

(a) Long positions in ordinary shares of the Company and associated corporation

						%
					Number of	of total
		Name of		Nature of	ordinary	issued
	Interests in	Director	Capacity	interests	shares held	shares
1.	The Company	Kong Qingping	Beneficial owner	Personal	15,012,000	0.232%
		Cui Duosheng	Beneficial owner	Personal	12,256,000	0.189%
		Yao Peifu	Beneficial owner	Personal	18,876,000	0.291%
		Hao Jian Min	Beneficial owner	Personal	2,460,000	0.038%
		Wu Jianbin	Beneficial owner	Personal	2,816,000	0.043%
		Jin Xinzhong	Beneficial owner	Personal	860,000	0.013%
		Wang Man
		Kwan, Paul	Beneficial owner	Personal	320,000	0.005%
		Li Kwok Po,
		David	Beneficial owner	Personal	200,000	0.003%
2.	China State	Kong Qingping	Beneficial owner	Personal	200,000	0.041%
	Construction	Cui Duosheng	Beneficial owner	Personal	163,333	0.033%
	(fellow	Yao Peifu	Beneficial owner	Personal	922,222	0.187%
	subsidiary)	Jin Xinzhong	Beneficial owner	Personal	15,000	0.003%
		Li Kwok Po,
		David	Beneficial owner	Personal	11,111	0.002%

— 19 —

APPENDIX I

GENERAL INFORMATION

• (b) Long positions in underlying shares of the Company and associated corporation

Share options

	Share options	Share options	Share options	Share options
Interest in Name of Director The Company Kong Qingping Cui Duosheng Yao Peifu	Number of ordinary shares attached to the share options
	Date of grant Outstanding at 1 January 2006 Granted during the period 17.07.1997 1,000,000 — 14.02.1998 10,440,000 — 30.09.1998 460,000 — 04.01.2000 800,000 — 18.06.2004 3,360,000 —		Exercised during the period Outstanding at the Latest Practicable Date — 1,000,000 (9,880,000) 560,000 (460,000) — (400,000) 400,000 (672,000) 2,688,000
	17.07.1997 14.02.1998 30.09.1998 04.01.2000 18.06.2004 17.07.1997 14.02.1998 30.09.1998 04.01.2000 18.06.2004	16,060,000	(11,412,000)
		1,000,000 — 8,520,000 — 360,000 — 680,000 — 2,880,000 —	— (8,040,000) (360,000) (340,000) (576,000)	1,000,000 480,000 — 340,000 2,304,000
		13,440,000	(9,316,000)
		3,800,000 — 14,200,000 — 500,000 — 800,000 — 2,880,000 —	— (13,400,000) (500,000) (400,000) (576,000)	3,800,000 800,000 — 400,000 2,304,000
		22,180,000	(14,876,000)

— 20 —

GENERAL INFORMATION

APPENDIX I

Share options

	Share options	Share options	Share options	Share options
Interest in Name of Director Hao Jian Min Wu Jianbin Xiao Xiao	Number of ordinary shares attached to the share options
	Date of grant Outstanding at 1 January 2006 Granted during the period Exercised during the period Outstanding at the Latest Practicable Date 17.07.1997 550,000 — — 550,000 14.02.1998 480,000 — (160,000) 320,000 30.09.1998 180,000 — (180,000) — 04.01.2000 480,000 — (240,000) 240,000 18.06.2004 2,304,000 — — 2,304,000
	17.07.1997 14.02.1998 30.09.1998 04.01.2000 18.06.2004 17.07.1997 14.02.1998 30.09.1998 04.01.2000 18.06.2004	3,994,000	(580,000)
		550,000 — 480,000 — 180,000 — 520,000 — 2,304,000 —	— (160,000) (180,000) (260,000) —	550,000 320,000 — 260,000 2,304,000
		4,034,000	(600,000)
		600,000 — 540,000 — 400,000 — 780,000 — 2,000,000 —	— — — — —	600,000 540,000 400,000 780,000 2,000,000
		4,320,000

— 21 —

GENERAL INFORMATION

APPENDIX I

Share options

	Share options	Share options	Share options	Share options
Interest in Name of Director Jin Xinzhong Cheung Shiu Kit China State Construction Kong Qingping Cui Duosheng Yao Peifu Hao Jian Min Wu Jianbin Xiao Xiao Jin Xinzhong Wang Man Kwan, Paul Cheung Shiu Kit	Number of ordinary shares attached to the share options
	Date of grant Outstanding at 1 January 2006 Granted during the period Exercised during the period Outstanding at the Latest Practicable Date 17.07.1997 200,000 — — 200,000 14.02.1998 180,000 — (60,000) 120,000 30.09.1998 50,000 — (50,000) — 04.01.2000 320,000 — (160,000) 160,000 18.06.2004 1,280,000 — — 1,280,000
	17.07.1997 18.06.2004 14.09.2005 14.09.2005 14.09.2005 14.09.2005 14.09.2005 14.09.2005 14.09.2005 14.09.2005 14.09.2005	2,030,000	(270,000)
		1,000,000 — 2,880,000 —	— —	1,000,000 2,880,000
		3,880,000 1,200,000 — 1,200,000 — 1,050,000 — 1,050,000 — 1,050,000 — 1,050,000 — 720,000 — 400,000 — 700,000 —	— — — — — — — — —

— 22 —

GENERAL INFORMATION

APPENDIX I

Save as disclosed above, as at the Latest Practicable Date, none of the Directors and chief executive of the Company hold any interest or short position in the shares, underlying shares and debentures of the Company or any of its associated corporation (within the meaning of the SFO) notifiable to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are taken or deemed to have under such provisions of the SFO) or which are required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein, or which are required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies of the Listing Rules, to be notified to the Company and the Stock Exchange.

There is no contract or arrangement subsisting at the Latest Practicable Date in which any of the Directors is materially interested and which is significant in relation to the business of the Group.

None of the Directors has had any direct or indirect interest in any assets which have since 31 December 2005 (being the date to which the latest published audited financial statements of the Company were made up) been 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.

3. SUBSTANTIAL SHAREHOLDERS

• (a) As at the Latest Practicable Date, according to the register kept by the Company under Section 336 of the SFO, the following persons and companies were interested in 5% or more in the shares or underlying shares of the Company which fall to be disclosed to the Company under Divisions 2 and 3 of Part XV of the SFO:

	Number of
	ordinary
	shares of	Percentage
Name of shareholder	HK$0.1 each	of interest
COHL (Note)	3,266,340,800	50.4%
CSCEC (Note)	3,266,340,800	50.4%

Note: Mr. Kong Qingping is also a director of CSCEC, COHL and certain of their subsidiaries. Messrs. Cui Duosheng, Yao Peifu. Hao Jian Min, Wu Jianbin, Xiao Xiao, Jin Xinzhong and Cheung Shiu Kit are also directors of COHL.

COHL is a direct wholly owned subsidiary of CSCEC, thus CSCEC is deemed by the SFO to be interested in 3,266,340,800 Shares directly owned by COHL.

Save as disclosed above, none of the Directors are directors or employees of a company which, and so far as was known to the Directors or chief executive of the Company, there was no other person (other than the Directors or chief executive of the Company) who, as at the Latest Practicable Date, had an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

— 23 —

GENERAL INFORMATION

APPENDIX I

(b) As at the Latest Practicable Date, so far as is known to the Directors or chief executive of the Company, the following persons (other than the Director or chief executive of the Company) were, 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 member of the Group:

==> picture [408 x 436] intentionally omitted <==

----- Start of picture text -----

|||||||||||
|---|---|---|---|---|---|---|---|---|---|
|Name|of|Substantial|Percentage|of|
|Name|of|Subsidiaries|Shareholders|Shareholdings|
|Beijing|China|Overseas|Zhongji|Zhongji|Industrial|Investment|Co.|49%|
|Property|Development|Co.|Ltd|Ltd|
|(|)|(|)|
|Beijing|Zhonghai|Seagarden|Real|Benefit|Sales|Limited|28%|
|Estate|Development|Co.,|Ltd.|(|)|
|(|)|
|China|Overseas|Sino|Land|Sino|Land|(Sichuan)|Co.,|Ltd.|20%|
|(Chengdu)|Property|Development|(|)|
|Co.,|Ltd.|
|(|)|
|Guangzhou|China|Overseas|Science|Dongjiang|Industrial|and|10%|
|City|Residential|Park|Development|Development|Company|Limited|
|Co.,|Ltd.|(|)|
|(|)|
|Laizhou|China|Ocean|Shipping|Beijing|Ocean|Shipping|Tally|20%|
|Tally|Co.,|Ltd.|Company|
|(|)|(|)|
|Macfull|Finance|Limited|Denmore|Limited|20%|
|(|)|
|Smart|Winner|Development|10%|
|Limited|
|(|)|
|Top|Brain|Development|Limited|10%|
|(|)|

----- End of picture text -----

— 24 —

GENERAL INFORMATION

APPENDIX I

==> picture [408 x 576] intentionally omitted <==

----- Start of picture text -----

|||||||||
|---|---|---|---|---|---|---|---|
|Name|of|Substantial|Percentage|of|
|Name|of|Subsidiaries|Shareholders|Shareholdings|
|Macfull|Limited|Denmore|Limited|20%|
|(|)|
|Smart|Winner|Development|10%|
|Limited|
|(|)|
|Top|Brain|Development|Limited|10%|
|(|)|
|Macwan|Finance|Limited|Brilliant|Fortune|Properties|20%|
|(|)|Limited|
|(|)|
|Golden|Properties|Finance|10%|
|Limited|
|Macwan|Limited|Rich|Tower|Properties|Limited|20%|
|(|)|(|)|
|Golden|Queen|International|10%|
|Limited|
|Maxjet|Company|Limited|Goldmond|Company|Limited|10%|
|(|)|
|Maxjet|Finance|Limited|Goldmond|Finance|Company|10%|
|(|)|Limited|
|Nanjing|China|Overseas|Wolong|Contemporary|Developments|Ltd.|25%|
|Real|Estate|Development|Limited|(|)|
|(|)|
|Nanjing|China|Overseas|Xiandai|Contemporary|Developments|Ltd.|25%|
|Real|Estate|Development|Limited|(|)|
|(|)|
|Nanjing|Lishui|China|Overseas|Nanjing|Yuanhao|Investment|25%|
|Longrun|Real|Estate|Development|Consulting|Co.,|Ltd.|
|Co.,|Ltd.|(|)|
|(|
|)|

----- End of picture text -----

— 25 —

GENERAL INFORMATION

APPENDIX I

Name of Substantial Percentage of Name of Subsidiaries Shareholders Shareholdings Nanjing Lishui China Overseas Nanjing Yuanhao Investment 25% Longze Real Estate Development Consulting Co., Ltd. Co., Ltd. ( ) ( ) Shandong Haitian Construction and Shandong Municipal Construction 40% Decoration Co., Ltd. Corporation ( ) ( ) Shanghai Haixing Real Estate Shanghai Zhongcheng Venture 49% Limited Group Real Estate Limited ( ) ( ) Shenyang Huanggu Fen Coal Ash Shenzhen Rongxiang Investment 10% Construction Materials Company Co., Ltd. Limited ( ) ( ) Shenzhen China Overseas Freight Shenzhen Rongxiang Investment 24.5% Co., Ltd. Co., Ltd. ( ) ( ) Shenzhen China Overseas Hai Ting Shenzhen Zheng Tong Hong Xing 40% Shan Zhuang Property Development Industrial Development Co. Ltd. Co. Ltd. ( ) ( ) Taixing China Overseas Qiwei Ferry Taixing Taitong Investment 30% Establishment Co., Ltd. Development Company Limited ) ( ) Taixing Haotong Qiwei Qidu Taixing Taitong Investment 30% Transport Co., Ltd. Development Company Limited ) ( )

Save as disclosed above, the Directors or chief executive of the Company are not aware of any person who was, as at the Latest Practicable Date, 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 meeting of any member of the Group or in any options in respect of such capital.

— 26 —

GENERAL INFORMATION

APPENDIX I

4. SERVICE CONTRACTS

As at the Latest Practicable Date, no Director had a service contract with any member of the Group which is not expiring or determinable by the Company within one year without the payment of compensation other than statutory compensation.

5. MATERIAL ADVERSE CHANGE

The Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2005, the date to which the latest published audited accounts of the Company were made up.

6. COMPETING BUSINESS INTERESTS OF DIRECTORS

As at the Latest Practicable date, the interests of the Directors in the businesses (other than those businesses where the Directors were appointed as directors to represent the interests of the Company and/or member of the Group) which are considered to compete or are likely to compete, either directly or indirectly, with the businesses of the Group were as follows:

	Name of entity	Description of
	whose businesses	businesses of the
	are considered to	entity which are
	compete or likely	considered to compete	Nature of
	to compete with	or likely to compete	interest of
	the businesses of	with the businesses of	the Director
Name of Director	the Group	the Group	in the entity	Note
Mr. Kong Qingping	COHL/CSCEC	Property development	director	2
	(Note1)	and investment
Mr. Cui Duosheng	COHL (Note1)	Property development	director	2
		and investment
Mr. Yao Peifu	COHL (Note1)	Property development	director	2
		and investment
Mr. Wu Jianbin	COHL (Note1)	Property development	director	2
		and investment
Mr. Xiao Xiao	COHL (Note1)	Property development	director	2
		and investment
Mr. Jin Xinzhong	COHL (Note1)	Property development	director	2
		and investment
Mr. Cheung Shiu Kit	COHL (Note1)	Property development	director	2
		and investment

— 27 —

GENERAL INFORMATION

APPENDIX I

Notes:

1. Including the subsidiaries of CSCEC (except the Company).

2. CSCEC is the ultimate holding company of the Company and the intermediate holding company of COHL.

Save as disclosed above, the Company had not been notified of any other relationship among the directors, senior management or substantial or controlling shareholders of the Company.

As the Board operates independently of the boards of these companies, the Group operates its business independently of, and at arm’s length from, the business of these companies.

7. EXPERT

Access Capital has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name and letter in the form and context in which it appears.

The qualification of the independent financial adviser who has given advice contained in this circular is set out as follows:

Name Qualification Access Capital A licensed corporation under the SFO, and engaged in types 1, 4, 6 and 9 regulated activities

Access Capital has confirmed that it does not have any interest, direct or indirect, in any assets which have been acquired or disposed of by or leased to any member of the Group, or which are proposed to be acquired or disposed of by or leased to any member of Group since 31 December 2005, being the date to which the latest published audited consolidated financial statements of the Company were made up.

The letter of Access Capital was given as of the date of this circular for incorporation herein.

8. MISCELLANEOUS

• The registered office of the Company is 10/F., Three Pacific Place, 1 Queen’s Road East, Hong Kong.

• The share registrar of the Company is Standard Registrars Limited of 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong.

• The qualified accountant of the Company is Mr. Wang Man Kwan, Paul, a member of The Hong Kong Institute of Certified Public Accountants.

— 28 —

GENERAL INFORMATION

APPENDIX I

• The company secretary of the Company is Mr. Keith Cheung, Solicitor.

• The English text of this circular will prevail over the Chinese text.

9. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during business hours at the office of the Company at 10/F., Three Pacific Place, 1 Queen’s Road East, Hong Kong from the date of this circular up to and including 12 July 2006 (Saturdays and Sundays excepted) and will be available for inspection at the Extraordinary General Meeting:-

• (a) the CSCEC Group Engagement Agreement;

• (b) the “Letter from the Independent Board Committee” as set out in this circular; and

• (c) the “Letter from Access Capital” as set out in this circular.

— 29 —

APPENDIX II PROCEDURES FOR VOTING BY POLL AT GENERAL MEETING

Pursuant to Article 75 of the Articles, every resolution submitted to a general meeting shall be determined on a show of hands in the first instance by the Shareholders present in person, but a poll may be demanded (before or on the declaration of the result of the show of hands or on withdrawal of any other demand for a poll) by the Chairman or by:

• (a) at least 3 Shareholders present in person (or, in the case of a member being a corporation, by its duly authorised representative) or by proxy having the right to vote at the meeting; or

• (b) a Shareholder or Shareholders present in person (or, in the case of a member being a corporation, by its duly authorised representative) or by proxy representing not less than one-tenth of the total voting rights of all the Shareholders having the right to vote at the meeting; or

• (c) a Shareholder or Shareholders present in person (or, in the case of a member being a corporation, by its duly authorised representative) or by proxy holding shares conferring a right to vote at the meeting, being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all the shares conferring the right.

Unless a poll be so demanded and not withdrawn, a declaration by the Chairman that a resolution has on a show of hands been carried or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the book containing the minutes of the proceedings of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour or against such resolution.

In accordance with the requirement under Chapter 13 of the Listing Rules, the Company will publish an announcement in newspapers of the results of any voting by poll at the general meeting on the business day following the meeting.

— 30 —

NOTICE OF EXTRAORDINARY GENERAL MEETING

==> picture [418 x 57] intentionally omitted <==

(incorporated in Hong Kong with limited liability)

(Stock Code: 688)

NOTICE IS HEREBY GIVEN that an extraordinary general meeting of the shareholders of China Overseas Land & Investment Ltd. (the “ Company ”) will be held at 11/F., Three Pacific Place, 1 Queen’s Road East, Hong Kong on Wednesday, 12 July 2006 immediately after conclusion of the extraordinary general meeting of the Company which is scheduled to be held at 3:00 p.m. on the same date to approve a proposed bonus issue of warrants, for the purpose of considering and, if thought fit, passing the following resolution as ordinary resolution of the Company:

ORDINARY RESOLUTION

“THAT:

• (a) (i) the CSCEC Group Engagement Agreement (as defined in the circular of the Company dated 22 June 2006 (the “ Circular ”)), (a copy of which is tabled at the meeting and marked “A” and initialled by the chairman of the meeting for identification purpose) and the continuing connected transaction contemplated thereunder and the implementation thereof be and are hereby approved, ratified and confirmed;

• (ii) the Cap (as defined in the Circular) for the three financial years ending 31 December 2008 be and is hereby approved;

• (b) any one director of the Company, or any two directors of the Company if the affixation of the common seal is necessary, be and is/are hereby authorised for and on behalf of the Company to execute all such other documents, instruments and agreements and to do all such acts or things deemed by him/her to be incidental to, ancillary to or in connection with the matters contemplated in the CSCEC Group Engagement Agreement.”

By Order of the Board

China Overseas Land & Investment Ltd.

Kong Qingping

Chairman and Chief Executive

Hong Kong, 22 June 2006

Registered office:

10/F., Three Pacific Place,

1 Queen’s Road East, Hong Kong

— 31 —

NOTICE OF EXTRAORDINARY GENERAL MEETING

Notes:

• (1) A form of proxy for use at the meeting is enclosed herewith.

• (2) Any member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and, on a poll, vote instead of him/her. A proxy need not be a member of the Company.

• (3) The instrument appointing a proxy shall be in writing under the hand of the appointor or of his/her attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer, attorney or other person authorised to sign the same.

• (4) In order to be valid, the form of proxy, together with the power of attorney (if any) or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, must be deposited at the office of the Company’s share registrar, Standard Registrars Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong, not less than 48 hours before the time appointed for holding the meeting or any adjourned meeting thereof (as the case may be).

• (5) Where there are joint registered holders of any share, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the meeting, whether in person or by proxy, the joint registered holders present whose name stands first on the register of members in respect of the shares shall be accepted to the exclusion of the votes of the other registered holders.

• (6) Completion and return of the form of proxy will not preclude members from attending and voting in person at the meeting or at any adjourned meeting thereof (as the case may be) should they so wish, and in such event, the form of proxy shall be deemed to be revoked.

• (7) The register of members of the Company will be closed, for the purpose of determining the identity of members who are entitled to attend and vote at the meeting, from 3 July 2006 (Monday) to 12 July 2006 (Wednesday), both days inclusive, during which period no transfers of shares will be effected. In order to be entitled to attend the meeting, all transfer documents accompanied by the relevant share certificates must be lodged with the registrar of the Company, Standard Registrars Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong not later than 4:00 p.m. on 30 June 2006 (Friday).

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