Central Development Holdings Limited — Capital/Financing Update 2014

Sep 28, 2014

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.

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CHINA RESOURCES AND TRANSPORTATION GROUP LIMITED 中國資源交通集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 269)

ISSUE OF 9% CONVERTIBLE BONDS DUE 2017 TO CHINA LIFE INSURANCE (OVERSEAS) COMPANY LIMITED

On 27 September 2014, the Company entered into a conditional subscription agreement with China Life for the issue of HK$600,000,000 principal amount of 9% Convertible Bonds due 2017 to China Life.

Assuming full conversion of the 9% Convertible Bonds due 2017 at the conversion price of HK$0.40 per Conversion Share, 1,500,000,000 Conversion Shares would represent approximately 5.55% of the issued share capital of the Company as at the date of this announcement and approximately 5.26% of the issued share capital of the Company as enlarged by their issue.

The Conversion Shares will be issued pursuant to the general mandate granted to the Directors by the Shareholders at the annual general meeting held on 28 August 2014. The subscription of the 9% Convertible Bonds due 2017 and the issue of the Conversion Shares by the Company are not subject to other Shareholders’ approval.

The Company has entered into a conditional subscription agreement with China Life to issue HK$600,000,000 principal amount of 9% Convertible Bonds due 2017 to China Life.

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THE SUBSCRIPTION AGREEMENT

Date

27 September 2014

Parties

• (1) The Company; and

• (2) China Life.

To the best knowledge, information and belief of the Directors, having made all reasonable enquires, China Life and its ultimate beneficial owners are independent third parties not connected with the Company or any of its connected persons.

Principal terms of the 9% Convertible Bonds Due 2017

The principal terms of the 9% Convertible Bonds due 2017 are:

Principal Amount HK$600,000,000 Issue Price 100% of the principal amount Interest 9% p. a. payable annually in arrears Maturity Date The third anniversary of the issue date or the next immediately following business day if such anniversary date is not a business day, on which the 9% Convertible Bonds due 2017 will be redeemed at par Conversion Period From the issue date until the maturity date Conversion Price HK$0.40 per Conversion Share, subject to adjustment in the event of specified dilutive events such as subdivision or consolidation, capital distribution, issuance of options, rights or warrants, and issue of new shares at less than current market value

Ranking of Conversion The Conversion Shares will rank pari passu in all respects Shares with the Shares in issue on the relevant conversion date

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• Number of Conversion Shares

• Minimum public float

• Mandatory Conversion

• Listing

• Transfer

• 1,500,000,000 Conversion Shares will be issued upon full conversion of the 9% Convertible Bonds due 2017 based on the initial conversion price of HK$0.40 per Conversion Share

• Notwithstanding the conversion rights attaching to the 9% Convertible Bonds due 2017, the Company may not issue any Conversion Share and the relevant 9% Convertible Bonds due 2017 will continue until redeemed on the maturity date if and to the extent that upon such issue of the Conversion Shares, the shareholding in the Company by the public will be less than 25% of the minimum prescribed percentage as set out in the Listing Rules from time to time

• If, at any time prior to the maturity date, the current market price of the Shares is more than HK$1.00 (such cut-off amount being subject to adjustment in the event of any subdivision or consolidation of the Shares) for 60 consecutive trading days, the Company may mandatorily convert all of any part of the 9% Convertible Bonds due 2017

• The 9% Convertible Bonds due 2017 will not be listed; the Conversion Shares will be listed

• The 9% Convertible Bonds due 2017 are transferable

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Conditions precedent to Issue

The closing obligations of China Life under the subscription agreement are conditional on the following conditions precedent:

• (i) the Stock Exchange having granted the listing of, and permission to deal in, the Conversion Shares with respect to the 9% Convertible Bonds due 2017;

• (ii) the representations and warranties of the Company under the subscription agreement not having been breached and remaining true and accurate in all material respects and not misleading in any material respect as at the date of issue of the 9% Convertible Bonds due 2017; and

• (iii) there being no event existing or having occurred and no condition being in existence which would (had the 9% Convertible Bonds due 2017 already been issued) constitute an event of default under the subscription agreement, and no event or act having occurred which, with the giving of any required notice or any required lapse of time or both, would (had the 9% Convertible Bonds due 2017 already been issued) constitute such an event of default.

If the conditions precedent cannot be satisfied by 3 October 2014 or such other date as the Company and China Life may agree in writing the subscription agreement will terminate.

The 9% Convertible Bonds due 2017 will be issued on the fifth business day following the receipt by China Life of a notice issued by the Company within three business days of being notified by the Stock Exchange of the grant of such aforesaid listing approval, or on such other date as the Company and China Life may otherwise agree. The issue price will be set off against the redemption proceeds for the HK$600,000,000 9% Convertible Bonds due 2014 held by China Life, which will mature on 29 September 2014.

Application of general mandate

The Conversion Shares will be issued pursuant to the general mandate granted to the Directors by the Shareholders at the annual general meeting held on 28 August 2014. The subscription of the 9% Convertible Bonds due 2017 and the issue of the Conversion Shares by the Company are not subject to other Shareholders’ approval.

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Comparison of conversion price

The initial conversion price of HK$0.40 per Conversion Share was arrived at after arm’s length negotiation between the Company and China Life and represents:

• (i) a premium of approximately 56.9% to the closing price of the Shares of HK$0.255 as quoted on the Stock Exchange on 26 September 2014 being the last trading day prior to the date of the subscription agreement;

• (ii) a premium of approximately 42.4% to the average of the closing price of the Shares as quoted on the Stock Exchange for the last 5 consecutive trading days up to and including 26 September 2014 being the last trading day prior to the date of the subscription agreement, of HK$0.281; and

• (iii) a premium of approximately 28.1% to the average of the closing price of the Shares as quoted on the Stock Exchange for the last 30 consecutive trading days up to and including 26 September 2014 being the last trading day prior to the date of the subscription agreement, of HK$0.312.

Conversion Shares

Assuming full conversion of the 9% Convertible Bonds due 2017 at the conversion price of HK$0.40 per Conversion Share, 1,500,000,000 Conversion Shares would be issued representing approximately 5.55% of the issued share capital of the Company as at the date of this announcement and approximately 5.26% of the issued share capital of the Company as enlarged by their issue.

The Conversion Shares have a nominal value of approximately HK$15 million and a market value of approximately HK$382.5 million based on the closing price of the Shares of HK$0.255 on 26 September 2014.

Reasons for Issue and Use of Proceeds

The 9% Convertible Bonds due 2017 will refinance the HK$600,000,000 9% Convertible Bonds due 2014, which will mature on 29 September 2014.

Application for listing of Conversion Shares

An application will be made to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Conversion Shares.

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Shareholding of the Company

The table below sets out the Company’s shareholding structure as at the date of this announcement and upon full conversion of the 9% Convertible Bonds due 2017, assuming no further issue or repurchase of Shares and no conversion of any of the other convertible securities of the Company:

Vivid Beyond Securities Limited China Alliance International Holding Group Limited Turbo View Investment Limited Directors Cao Zhong_(Note 1) Fung Tsun Pong(Note 2)_ China Life Public Shareholders Total	Shareholding as at the date of this announcement No. of Shares % 2,500,000,000 9.26 2,025,862,068 7.50 1,500,000,000 5.55 3,128,500,000 11.58 3,071,662,449 11.37 6,200,162,449 22.95 1,440,200,000 5.33 13,343,359,378 49.40 27,009,583,895 100.00	Shareholding upon full conversion of the 9% Convertible Bonds due 2017 No. of Shares % 2,500,000,000 8.77 2,025,862,068 7.11 1,500,000,000 5.26 3,128,500,000 10.97 3,071,662,449 10.77 6,200,162,449 21.74 2,940,200,000 10.31 13,343,359,378 46.80 28,509,583,895 100.00	Shareholding upon full conversion of the 9% Convertible Bonds due 2017 No. of Shares % 2,500,000,000 8.77 2,025,862,068 7.11 1,500,000,000 5.26 3,128,500,000 10.97 3,071,662,449 10.77 6,200,162,449 21.74 2,940,200,000 10.31 13,343,359,378 46.80 28,509,583,895 100.00
			21.74 10.31
			46.80
			100.00

Notes:

1. Mr. Cao Zhong, the chairman of the Company and an executive Director is interested in 135,200,000 Shares personally and 2,993,300,000 Shares through Champion Rise International Limited, a company wholly owned by him.

2. Mr. Fung Tsun Pong, the vice chairman of the Company and an executive Director, holds 1,242,362,449 Shares personally and 1,829,300,000 Shares through Ocean Gain Limited, a company wholly owned by him.

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Fund-raising in the Last 12 Months

On 3 September 2013 and 12 February 2014, the Company issued HK$2,584 million 9% convertible bonds due 2015 in two tranches, the details of which are set forth in the Company’s announcement and circular dated 14 June 2013 and 30 July 2013, respectively. As at the date of this announcement, HK$1,400 million of the net proceeds have been applied to set off against repayment of the Company’s convertible bonds due 2014, approximately HK$580 million of the net proceeds have been applied to fund the Capital Increase and the remaining net proceeds of approximately HK$600 million will also be used to fund the Capital Increase.

On 16 October 2013, the Company granted share options relating to the subscription for 350,500,000 Shares, the details of which are set forth in the Company’s announcement dated 16 October 2013. As at the date of this announcement, options to subscribe for 2,500,000 Shares have lapsed and no options have been exercised or cancelled.

On 22 October 2013, 26 November 2013 and 28 November 2013, the Company issued HK$1,500 million 9% Convertible Bonds due 2016 in three tranches, the details of which are set forth in the Company’s announcement dated 11 September 2013. The Company has applied approximately HK$900 million of the net proceeds for funding the Capital Increase and the acquisition of additional 4.6% equity interest in Zhunxing in February 2014, and will apply the remaining net proceeds of approximately HK$600 million to repay borrowings.

Save for the above transactions, the Company has not carried out any equity fund raising exercise in the 12 months immediately preceding the date of this announcement.

Definitions

In this announcement, unless inconsistent with the context, the following definitions apply:

• “Capital Increase” the increase of the Group’s interest in Zhunxing from 55.9% to 82.27%, the details of which are set out in the Company’s announcement and circular dated 14 June 2013 and 30 July 2013, respectively;

“China Life” China Life Insurance (Overseas) Company Limited;

• “Company” China Resources and Transportation Group Limited;

“Conversion Shares” The Shares to be issued upon conversion of the 9% Convertible Bonds due 2017;

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“Directors” The directors of the Company; “Group” The Company and its subsidiaries; “Listing Rules” The Rules Governing the Listing of Securities on the Stock Exchange; “Shareholders” Holders of Shares; “Shares” Shares in the Company of nominal value HK$0.01 each; “Stock Exchange” The Stock Exchange of Hong Kong Limited; and “Zhunxing” 內蒙古准興重載高速公路有限責任公司 (Inner Mongolia Zhunxing Heavy Haul Expressway Company Limited), a 86.87% non-wholly owned subsidiary of the Group as at the date of this announcement.

By order of the Board China Resources and Transportation Group Limited Cao Zhong Chairman

Hong Kong, 28 September 2014

As at the date of this announcement, the Board comprises five executive Directors, namely Messrs Cao Zhong, Fung Tsun Pong, Duan Jingquan, Tsang Kam Ching, David and Gao Zhiping; a non-executive Director namely Mr. Suo Suo Stephen; and three independent non-executive Directors, namely Messrs Yip Tak On, Jing Baoli and Bao Liang Ming.

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