CHINA STATE CONSTRUCTION DEVELOPMENT HOLDINGS LIMITED — Capital/Financing Update 2004

May 19, 2004

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, 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 announcement.

UNIVERSAL HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 419)

ANNOUNCEMENT

The board of Directors refers to the announcement of DVN dated 18 May 2004. As at the date of this announcement, UHL, Mr. Ko and Prime Pacific International Limited, a company controlled as to 67% by UHL and as to 33% by Mr. Ko, are together currently beneficially interested in an aggregate of approximately 35.34% of the existing issued ordinary share capital of DVN.

As described in the DVN Announcement, DVN and the Subscriber entered into the Subscription Agreement on 18 May 2004. Pursuant to the Subscription Agreement, the Subscriber will subscribe for new Shares in DVN in up to 4 tranches. One of the conditions of the First Tranche Completion is the receipt by the Subscriber of the Shareholders’ Deed duly executed by Mr. Ko and UHL.

Mr. Ko and UHL, as the shareholders of DVN, entered into the Shareholders’ Deed with the Subscriber on 18 May 2004. Pursuant to the Shareholders’ Deed, among other things, Mr. Ko and UHL undertake to the Subscriber not to, and will procure Mr. Ko Associates and UHL Associates not to, dispose of any interest in the DVN group subject to certain terms and conditions set out in the Shareholders’ Deed. Such restrictions apply during the period commencing on the date of the Subscription Agreement and ending on the date 6 months after the date of the First Tranche Completion, as detailed in this announcement.

Trading of the shares of UHL on the Stock Exchange has been suspended at the request of UHL with effect from 9:30 a.m. on 22 April 2004 pending the release of this announcement. An application has been made by UHL to the Stock Exchange for the resumption of the trading of the shares of UHL with effect from 9:30 a.m. on 19 May 2004.

The board of Directors refers to the DVN Announcement regarding, among other things, the Subscription Agreement entered into between DVN and the Subscriber on 18 May 2004. As at the date of this announcement, UHL is itself beneficially interested in approximately 7.47% of the existing issued ordinary share capital of DVN, Mr. Ko (with his family members in person or through their respective whollyowned companies) is beneficially interested in approximately 1.84% of the issued ordinary share capital of DVN, and Prime Pacific International Limited, a company which is owned as to 67% by Gold Pagolda Incorporated (a wholly owned subsidiary of UHL) and as to 33% by Prime Gold International Limited (a company owned as to 82.45% by Kwan Wing Holdings Limited which in turn is wholly-owned by Mr. Ko and as to 17.55% by Shining Sky Consultants Limited which in turn is wholly-owned by Mr. Lui Pan, Terry, an executive director of DVN), is beneficially interested in approximately 26.03% of the existing issued ordinary share capital of DVN. UHL, Mr. Ko and Prime Pacific International Limited are together currently beneficially interested in an aggregate of approximately 35.34% of the existing issued ordinary share capital of DVN. In addition, as at the date of this announcement, UHL also holds, through its wholly-owned subsidiary, preference shares with a face value of US$15 million issued by DVNGL which

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are exchangeable into approximately 24,786,780 Shares at a conversion price of HK$4.69 per share (subject to adjustment).

THE SUBSCRIPTION AGREEMENT BETWEEN DVN AND THE SUBSCRIBER

As described in the DVN Announcement, on 18 May 2004, DVN entered into the Subscription Agreement with the Subscriber. Under the Subscription Agreement, the Subscriber has conditionally agreed to subscribe for and DVN has conditionally agreed to allot and issue to the Subscriber new Shares in up to four tranches for a cash consideration if all four tranches are subscribed for of up to a maximum of US$33 million (equivalent to approximately HK$257.4 million), subject to certain terms and conditions as detailed in the DVN Announcement. One of the conditions of the First Tranche Completion is the receipt by the Subscriber of the Shareholders’ Deed duly executed by UHL and Mr. Ko.

SHAREHOLDERS’ DEED

Mr. Ko and UHL, as the shareholders of DVN, entered into the Shareholders’ Deed with the Subscriber on 18 May 2004. Pursuant to the Shareholders’ Deed, Mr. Ko and UHL agreed that, among other things, during the period commencing on the date of the Subscription Agreement and ending on the date 6 months after the date of the First Tranche Completion, Mr. Ko and UHL will not, and will procure their respective Mr. Ko Associates and UHL Associates will not, without the consent of the Subscriber, (i) engage in any negotiations or discussions (save for when Mr. Ko is acting in his capacity as a Chairman of DVN or as a director of any of the DVN group companies) or enter into any agreement, arrangement or understanding regarding any Prohibited Activity and (ii) create any encumbrance (capable of being enforced or exercised during such period) over any securities held directly or indirectly by any of them.

Notwithstanding that, during the period commencing on the date of the Subscription Agreement and ending on the date 6 months after the date of the First Tranche Completion,

• (i) Mr. Ko Associates may dispose on-market through the Stock Exchange in an orderly manner up to 20% of the Shares in issue as at the date of the Shareholders’ Deed;

• (ii) transfers or sales of any Shares among the Mr. Ko Associates or UHL Associates and transfers or sales of any ordinary shares in UHL among the Mr. Ko Associates may be made if such ordinary shares remain held by a Controlled Person of Mr. Ko after the transfer or sale;

• (iii) Mr. Ko Associates may dispose on-market through the Stock Exchange in an orderly manner up to 20% of the ordinary shares in UHL in issue as at the date of the Shareholders’ Deed;

• (iv) Mr. Ko Associates may exercise the options in respect of the Shares which have been or may be granted to them under any of DVN’s share option schemes;

• (v) Mr. Ko Associates may exercise the exchangeable right attaching to the convertible preference shares issued by DVNGL as at the date of the Shareholders’ Deed; and

• (vi) Mr. Ko Associates may acquire any number of Shares or ordinary shares in UHL.

Mr. Ko Associates may undertake any top-up placing transaction in respect of the ordinary shares in UHL and Mr. Ko Associates or UHL Associates may (provided that the Subscriber has consented to any new

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issue of Shares by DVN pursuant to the Subscription Agreement) undertake any top-up placing transaction in respect of the Shares. (UHL has no plan to do any top-up placing transaction at this moment. Should a top-up placing transaction take place in the future, UHL will make appropriate announcement according to the Listing Rules.) Mr. Ko and UHL have agreed not to dispose of any other securities issued by any member of the DVN group including those convertible or exchangeable into any Shares or any ordinary shares in UHL.

The Shareholders’ Deed shall cease to have effect on the earlier of (i) the day after the date 6 months after the date of the First Tranche Completion; (ii) certain undertaking given by DVN to the Subscriber under the Subscription Agreement ceasing to be of effect due to the Second Tranche Completion not occurring on or before the said long stop date; or (iii) the termination of the Subscription Agreement.

GENERAL

For further details of the Subscription Agreement, please refer to the DVN Announcement.

The board of Directors comprises Mr. Ko Chun Shun, Johnson (Chairman and executive Director), Mr. Cheong Chow Yin (non-executive Director), Mr. Wilton Timothy Carr Ingram and Dr. Wong Yau Kar, David (each of whom is an independent non-executive Director).

Trading of the shares of UHL on the Stock Exchange has been suspended at the request of UHL with effect from 9:30 a.m. on 22 April 2004 pending the release of this announcement. An application has been made by UHL to the Stock Exchange for the resumption of the trading of the shares of UHL with effect from 9:30 a.m. on 19 May 2004.

DEFINITIONS

“Affiliates” any subsidiary or holding company of a company and any subsidiary of any such holding company or any Controlled Persons of any of the foregoing persons

• “associates” has the meaning ascribed thereto under the Listing Rules

“Control” means the direct or indirect possession of the power to direct or cause the direction of the management and policies of another person (the “controlled person”), whether, directly or indirectly, (a) through the holding of securities, or the possession of voting power in relation to the controlled person; or (b) by the memorandum or articles of association or other document regulating the controlled person; or (c) through controlling the composition of the board of the controlled person to an extent to enable the control or direction of the decisions of such board; or (d) through controlling the appointment or actions of the legal representative, general manager or other person(s) who have the ability to exercise the powers or authority of the controlled person; or (e) by contract or otherwise; and in relation to a partnership, means the right to a share of more than one-half of the assets, or more than one-half of the income, of the partnership, provided that where rights to share the assets or income of a partnership are held in equal shares, then if a person can also direct or cause the direction of the affairs of such partnership then such person “controls” the partnership

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“Controlled Persons”

• in relation to a person, means any person under the Control of the firstmentioned person and any Controlled Persons of such persons

• “Directors”

the directors of UHL

• “DVN” DVN (Holdings) Limited, a company incorporated in Bermuda with limited liability, the Shares of which are listed on the main board of the Stock Exchange

• “DVN Announcement”

the announcement dated 18 May 2004 issued by DVN

• “DVNGL” DVN (Group) Limited, a company incorporated in British Virgin Islands with limited liability and a wholly-owned subsidiary of DVN

• “First Tranche completion of the subscription of new Shares under the first tranche in Completion” accordance with the terms and conditions under the Subscription Agreement

• “Mr. Ko” Mr. Ko Chun Shun, Johnson, being the Chairman of the board of Directors and controlling shareholder of UHL, who together with his concert parties holds a total of approximately 31.12% direct and indirect interests in UHL

• “Mr. Ko Associates”

  • Mr. Ko, his wife, companies directly or indirectly controlled by Mr. Ko which hold direct or indirect interests in the Shares or ordinary shares of UHL, his Controlled Persons, his Related Persons and their respective Representatives, Affiliates and Controlled Persons

• “Prohibited Activity” any proposal or offer relating to the acquisition, merger, combination, sale or other disposition or disposal of part of, or the whole of any DVN group companies or any securities of any DVN group companies

• “Related Persons” spouse, person cohabiting as a spouse, child (natural or adopted), step-child, parent, step-parent, brother, sister and any person who is accustomed to act in accordance with the instructions of the individual concerned (including without limitation any trustees of any trust of which he or any of the foregoing persons is a beneficiary or a discretionary object); and any Controlled Persons of any persons included in this definition

• “Representatives” in relation to a company means its directors, officers, agents, advisers or employees; and in relation to an individual means his/her agents or advisers

• “Second Tranche completion of the subscription of new Shares under the second tranche in Completion” accordance with the terms and conditions under the Subscription Agreement

• “Shares” ordinary share(s) of HK$0.10 each in the share capital of DVN

• “Shareholders’ Deed” the deed dated 18 May 2004 entered into between the Subscriber, Mr. Ko and UHL

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“Stock Exchange”

The Stock Exchange of Hong Kong Limited

• “Subscriber”

  • Motorola-Dragon Investment, Inc., a company incorporated in the State of Delaware USA and an indirect wholly-owned subsidiary of Motorola, Inc. which shares are listed on The New York Stock Exchange

• “Subscription the conditional subscription agreement dated 18 May 2004 entered into between Agreement” DVN and the Subscriber in relation to the subscription of new Shares by the Subscriber as detailed in the DVN Announcement

• “UHL” Universal Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the ordinary shares of which are listed on the main board of the Stock Exchange

• “UHL Associates” UHL, companies directly or indirectly controlled by UHL which hold direct or indirect interests in the Shares, and their Representatives, Affiliates and Controlled Persons

• “USA” United States of America

• “HK$” Hong Kong dollars

• “US$” United States dollars, the lawful currency of the United States of America

By Order of the Board UNIVERSAL HOLDINGS LIMITED Johnson Ko Chun Shun Chairman

Hong Kong, 18 May 2004

For illustrative purposes only, amounts denominated in US$ have been translated into HK$ at the rate of US$1.0 to HK$7.8. No representation is made that any amounts in US$ could have been or could be converted at the above rate or at any other rates or at all.

Please also refer to the published version of this announcement in the China Daily.

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