Elife Holdings Limited — Proxy Solicitation & Information Statement 2009

Mar 18, 2009

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Sino Resources Group Limited (the “Company”), you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or the transferee(s), or to the bank, licensed securities dealer or other agent through whom the sale or the transfer was effected for transmission to the purchaser(s) or the transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

==> picture [58 x 67] intentionally omitted <==

SINO RESOURCES GROUP LIMITED (carrying on business in Hong Kong as Sino Gp Limited) 神州資源集團有限公司[*]

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 223)

CONNECTED TRANSACTION IN RELATION TO DISPOSAL OF A SUBSIDIARY AND CONTINUING CONNECTED TRANSACTION IN RELATION TO THE MASTER PROJECT MANAGEMENT AGREEMENT

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

==> picture [218 x 34] intentionally omitted <==

A letter from the Independent Board Committee (as defined in this circular) containing its advice to the Independent Shareholders (as defined in this circular) is set out on page 12 to 13 of this circular. A letter from Partners Capital International Limited setting out its advice and recommendation to the Independent Board Committee and the Independent Shareholders is set out on pages 14 to 23 of this circular.

A notice convening an extraordinary general meeting of the Company (the “EGM”) to be held at 10:00 a.m. on Monday, 6 April, 2009 at 30/F, One Kowloon, No.1 Wang Yuen Street, Kowloon Bay, Kowloon, Hong Kong is set out on pages 29 to 30 of this circular.

A form of proxy for use at the EGM is enclosed. Whether or not you are able to attend the EGM in person, you are requested to complete and return the enclosed proxy form in accordance with the instructions printed thereon to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, as soon as possible but in any event not less than 48 hours before the time scheduled for the holding of the EGM or any adjournments thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournments thereof should you so wish.

• For identification purpose only

19 March, 2009

CONTENTS

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
LETTER FROM THE INDEPENDENT BOARD COMMITTEE. . . . . . . . . . . . . . . . . . . . . . . .	12
LETTER FROM PARTNERS CAPITAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
APPENDIX – GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	24
NOTICE OF EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29

DEFINITIONS

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

“Board”	the board of Directors
“Company”	Sino Resources Group Limited (carrying on business in Hong
	Kong as Sino Gp Limited), a company incorporated in the Cayman
	Islands
“Director(s)”	the director(s) of the Company
“Disposal”	the sale of the entire issued share capital of, and loan to Group
	Idea to the Purchasers
“EGM”	an extraordinary general meeting of the Company to be held at
	10:00 a.m. on Monday, 6 April, 2009 at 30/F, One Kowloon,
	No. 1 Wang Yuen Street, Kowloon Bay, Kowloon, Hong Kong for
	the approval of the Master Project Management Agreement, the
	transaction contemplated thereunder and the annual cap amounts
“Group”	the Company and its subsidiaries
“Group Idea”	Group Idea International Limited, a limited liability company
	incorporated in the British Virgin Islands, whose entire issued
	share capital is wholly-owned by Pro-Capital and to be sold to the
	Purchasers pursuant to the terms and conditions of the Sale and
	Purchase Agreement
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Independent Board Committee”	an independent board committee of the Company comprising all
	the independent non-executive Directors to advise the Independent
	Shareholders as to the Master Project Management Agreement, the
	transaction contemplated thereunder and the annual cap amounts
“Independent Shareholders”	shareholders of the Company other than Mr. Cheung Shui Kwai,
	Mr. Javed Iqbal Khan and their respective associates within the
	meaning ascribed to it under the Listing Rules and who have no
	interests in the Disposal and the Master Project Management
	Agreement and are not required to abstain from voting on the
	resolution to approve the Master Project Management Agreement,
	the transactions contemplated thereunder and the annual cap
	amounts at the EGM pursuant to the Listing Rules

• “Latest Practicable Date” 18 March, 2009, being the latest practicable date for ascertaining certain information for inclusion in this circular

1

DEFINITIONS

“Listing Rules” The Rules Governing the Listing of Securities on the Stock Exchange “Master Project Management the master project management agreement to be entered into Agreement” between Group Idea and Pro-Capital on the completion date of the Disposal “Partners Capital” Partners Capital International Limited, a licensed corporation to carry on business in type 1 and type 6 regulated activities under the SFO which has been appointed to act as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts “Pro-Capital” Pro-Capital Investments Limited, a company incorporated in the British Virgin Islands which is a wholly-owned subsidiary of the Company “Purchasers” Mr. Cheung Shui Kwai and Mr. Javed Iqbal Khan, both of whom are executive Directors “Sale and Purchase Agreement” the agreement for sale and purchase of the entire issued share capital of, and loan to, Group Idea, entered into between ProCapital and the Purchasers on 26 February, 2009 “SFO” Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong “Stock Exchange” The Stock Exchange of Hong Kong Limited “US$” United States dollar, the lawful currency of the United States of America

2

LETTER FROM THE BOARD

==> picture [58 x 67] intentionally omitted <==

SINO RESOURCES GROUP LIMITED (carrying on business in Hong Kong as Sino Gp Limited) 神州資源集團有限公司[*]

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 223)

Executive Directors: Mr. Hung Chen, Richael (Chairman) Mr. Ip Ki Cheung Mr. Cheung Shui Kwai Mr. Chan Siu Chung Mr. Javed Iqbal Khan Mr. Fong Wang

Independent non-executive Directors: Mr. Cheng Wing Keung, Raymond Mr. Lu Xin Mr. Cheng Hong Kei

Registered office: Cricket Square, Hutchins Drive, P.O. Box 2681 Grand Cayman KY1-111 Cayman Islands

Head office and principal place of business in Hong Kong: 30/F. One Kowloon, No.1 Wang Yuen Street Kowloon Bay, Kowloon, Hong Kong 19 March, 2009

To the shareholders of the Company

Dear Sir or Madam,

CONNECTED TRANSACTION IN RELATION TO DISPOSAL OF A SUBSIDIARY AND CONTINUING CONNECTED TRANSACTION IN RELATION TO THE MASTER PROJECT MANAGEMENT AGREEMENT

INTRODUCTION

Reference is made to an announcement of the Company dated 26 February, 2009 in relation to among other matters, the Disposal and the Master Project Management Agreement. The purpose of this circular is to provide you with further information in relation to the Disposal, the Master Project Management Agreement and the relevant annual caps thereunder and to give shareholders of the Company notice of the EGM. This circular also contains the recommendation from Partners Capital to the Independent Board Committee and the Independent Shareholders and the recommendation of the Independent Board Committee.

• For identification purpose only

3

LETTER FROM THE BOARD

CONNECTED TRANSACTION

The Board announced that on 26 February, 2009 (after trading hours) the Purchasers and ProCapital, a wholly-owned subsidiary of the Company, entered into the Sale and Purchase Agreement pursuant to which, subject to the satisfaction of certain conditions, the Purchasers agreed to purchase and Pro-Capital agreed to sell the entire issued share capital of Group Idea, a wholly-owned subsidiary of the Company together with the loan owed to Pro-Capital for an aggregate consideration of HK$5 million. It is also proposed that Group Idea and Pro-Capital will enter into the Master Project Management Agreement upon completion of the Disposal.

THE SALE AND PURCHASE AGREEMENT

Date

26 February, 2009

Parties

• Mr. Cheung Shui Kwai and Mr. Javed Iqbal Khan, together as Purchasers. Pro-Capital, a wholly-owned subsidiary of the Company, as vendor.

Assets to be disposed of:

The entire issued share capital of Group Idea, being 100 shares of US$1.00 each, of which 98 shares to Mr. Cheung Shui Kwai and 2 shares to Mr. Javed Iqbal Khan, together with the benefit of a loan advanced by Pro-Capital to Group Idea, which is unsecured, interest-free and repayable on demand.

Consideration and basis of consideration:

HK$5 million will be paid by the Purchasers on a pro rata basis upon completion of the Disposal in cash. Such consideration was determined after an arm’s length negotiation between the Purchasers and Pro-Capital, with reference to among other things, the face value of the shareholder’s loan of HK$2,974,767.07 as at the date of the Sale and Purchase Agreement on a dollar for dollar basis, as well as the net deficit of Group Idea based on the unaudited management account as at 22 February, 2009. The loan owed by Group Idea to Pro-Capital represents the prepayment in relation to the facilities licences held by Group Idea. The proceeds from the Disposal will be used by the Group as general working capital.

The Disposal is conditional upon:

• (i) the compliance by the Company of any requirement under the Listing Rules, including, without limitation, the obtaining of the approval from the Independent Shareholders in the EGM in connection with the Master Project Management Agreement as further discussed below, and the transactions contemplated therein; and

• (ii) the obtaining of all necessary consents, authorisations, waiver or other approvals of any kind in connection with the entering into and performance of the terms of the Sale and Purchase Agreement by the parties thereto; and

4

LETTER FROM THE BOARD

• (iii) the Purchasers being satisfied, from the date of the Sale and Purchase Agreement and at any time before the completion of the Disposal, that the warranties and representations given by Pro-Capital under the Sale and Purchase Agreement remain true, accurate, not misleading or in breach in any material respect.

If the above conditions are not wholly fulfilled (or waived, as the case may be) on or before 5:00 p.m. on 30 June, 2009 (or such later date as agreed by the parties), the Sale and Purchase Agreement shall lapse and the Disposal will not proceed.

FINANCIAL EFFECT OF THE DISPOSAL

After the completion of the Disposal, Group Idea will cease to be a subsidiary of the Company. Since the consideration for the Disposal was arrived at with reference to the face value of the loan from Pro-Capital to Group Idea of approximately HK$3 million and the unaudited net deficit of Group Idea of approximately HK$9,000 as at 22 February, 2009, the Company expects to record a gain from the Disposal of approximately HK$2 million.

In view of the gain which is expected to be recorded by the Company upon completion of the Disposal, the Board (including the independent non-executive Directors) considers the consideration in respect of the Disposal is fair and reasonable and in the interests of the Company and its shareholders as a whole.

INFORMATION ABOUT THE GROUP

The principal activities of the Group are production and sales of coal in the People’s Republic of China, and organisation of exhibitions and trade shows and providing related ancillary services.

5

LETTER FROM THE BOARD

INFORMATION ABOUT GROUP IDEA

The principal activity of Group Idea is investment holding and it is holding seven facilities licences for the use of certain exhibition halls during the relevant licence periods. The total commitment associated with these facilities licences amounting to approximately HK$33 million in 2009 and among which about HK$3 million has been prepaid by Pro-Capital as at the Latest Practicable Date. The details of the facilities licences are as follows:

	Licensor under
Licence period	the Licence Agreements	Licenced venue	Name of exhibitions
17 October, 2008 –	Venetian Cotai Limited	Authorized area in	Kenfair Fall
22 October, 2008		The Venetian Macao	Expo 2008
		Resort as stipulated
		under the relevant
		licence agreement
17 April, 2009 –	Venetian Cotai Limited	Authorized area in	Kenfair Spring
22 April, 2009		The Venetian Macao	Expo 2009
		Resort as stipulated
		under the relevant
		licence agreement
17 October, 2009 –	Venetian Cotai Limited	Authorized area in	Kenfair Fall
22 October, 2009		The Venetian Macao	Expo 2009
		Resort as stipulated
		under the relevant
		licence agreement
18 October, 2009 –	Hong Kong Convention	Licenced area in Hong Kong	Mega Show Part 1
23 October, 2009	and Exhibition Centre	Convention and Exhibition
	(Management) Limited	Centre as stipulated under
		the relevant licence
		agreement
26 October, 2009 –	Hong Kong Convention	Licenced area in Hong Kong	Mega Show Part 2
30 October, 2009	and Exhibition Centre	Convention and Exhibition
	(Management) Limited	Centre as stipulated under
		the relevant licence
		agreement
26 October, 2009 –	Hong Kong Convention	Licenced area in Hong Kong	Gifts, Decor & Home
30 October, 2009	and Exhibition Centre	Convention and Exhibition
	(Management) Limited	Centre as stipulated under
		the relevant licence
		agreement
(a) 23 January, 2010 –	Olympia Limited	Licenced area in	Asia Expo 2010 – 2011
28 January, 2010		The Olympia Exhibition
(b) 22 January, 2011 –		Centre, United Kingdom
27 January, 2011		as stipulated under the
		relevant licence agreement

For the two years ended 31 March, 2008, the losses before as well as after taxation of Group Idea were nil and HK$9,516 respectively.

6

LETTER FROM THE BOARD

CONTINUING CONNECTED TRANSACTION

Principal terms of the Master Project Management Agreement

Date:

It is expected that the Master Project Management Agreement will be signed on the completion date of the Disposal.

Parties:

Group Idea, as facilities licence holder and Pro-Capital, for itself and on behalf of each of its subsidiaries, who will provide certain management services from time to time as the project manager.

Term:

Three years commencing on the date of the Master Project Management Agreement until its expiry or early termination.

Appointment:

Group Idea shall appoint Pro-Capital or its subsidiaries to provide certain management services, as further discussed below, from time to time and Pro-Capital will accept the appointment to provide Group Idea with such management services for the exhibitions managed by it during the term. Pro-Capital will be granted the first refusal right to accept the appointment for itself and on behalf of its subsidiaries as project manager for each exhibition or trade fair on a case by case basis.

First Refusal Rights:

Group Idea will grant a first refusal right to Pro-Capital (for itself and on behalf of its subsidiaries), at a consideration of HK$1, to act as the project manager to provide exclusively certain management services for the exhibitions and trade fairs to be organised by Group Idea from time to time during the term. The provision of the management services shall be on normal commercial terms and shall be on terms no more favourable than those from time to time applicable to similar services quoted by members of the Group to other independent parties not related to Group Idea and/or its associates.

Management Services:

As the project manager, Pro-Capital and/or its subsidiaries shall provide the management services and procure the provision of such services to Group Idea, including but not limited to providing human resources support; providing advertising, marketing and other promotional support; managing and overseeing the operation of the exhibitions and ensuring the smooth and efficient running of the exhibitions; arranging for construction, removal and selling of booths; keeping proper books and records for the exhibitions and such other matters as the project manager shall consider necessary to carry out or perform its duties under the Master Project Management Agreement.

7

LETTER FROM THE BOARD

Group Idea will bear all the costs and obligations in connection with the facilities licences and will be responsible for formulating strategy so as to promote the exhibitions internationally. In return, Group Idea will share with Pro-Capital the revenue of each exhibition managed by Pro-Capital and/or its subsidiaries. Pursuant to the Master Project Management Agreement, Group Idea will share 20% of the revenue in respect of each exhibition managed by Pro-Capital and/or its subsidiaries. For the purpose of Rule 14A.35(2) of the Listing Rules, the Board proposes that the annual cap amounts of the sums of such shared revenue for the three years ending 31 December, 2011 will be HK$38 million, HK$41 million and HK$41 million, respectively. The annual cap amounts were determined after an arm’s length negotiation between the Purchasers and Pro-Capital with reference to the licence fees payable by Group Idea, the outlook and historical performance of these exhibitions and the expertise and network of Purchasers in promoting the exhibitions internationally. Such annual cap amounts were also determined on the assumption that Pro-Capital will act as the project manager for all the exhibitions organised by Group Idea every year in the coming three years and the revenue from these exhibitions remains the same as they were in 2008.

As the applicable percentage ratio in connection with the revenue sharing arrangement under the Master Project Management Agreement is more than 2.5% and the total consideration is expected to be more than HK$10 million, the Master Project Management Agreement and the corresponding annual cap amounts are subject to the reporting, announcement and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules. The Purchasers and their respective associates, within the meaning ascribed to it under the Listing Rules, shall abstain from voting on the resolution in respect of the Master Project Management Agreement and annual cap amount at the EGM. Particulars of the Master Project Management Agreement will be disclosed in the future annual reports and accounts of the Company in accordance with Rule 14A.46 of the Listing Rules.

Conditions precedent:

The continuing connected transaction contemplated under the Master Project Management Agreement is conditional on, among other things, the passing of the necessary resolution by the Independent Shareholders at the EGM to approve the transaction contemplated under the Master Project Management Agreement and the relevant annual cap amounts and all approvals, consents and waivers required by any applicable laws, rules, regulations or governmental, administrative or regulatory bodies necessary for the parties to consummate this transaction having been obtained. According to the board resolution of the Company dated 24 February, 2009, Pro-Capital has indicated (for itself and on behalf of its subsidiaries) its willingness to act as the project manager to provide the management services in respect of all the exhibitions to be held in Hong Kong, namely Mega Show Part 1 & 2 and Gifts, Decor & Home at Hong Kong Convention and Exhibition Centre in 2009. As at the Latest Practicable Date, the Board was still reviewing the opportunity to act as the project manager for the exhibitions to be held in Macau in 2009 and London in 2010 and 2011.

8

LETTER FROM THE BOARD

REASONS FOR AND BENEFIT OF THE TRANSACTIONS

The Group has diversified its businesses into the mining sector during 2008 as the Group’s business in the exhibition sector has been loss making in the past several years. Although the Directors expect to see the exhibition sector improving for the fiscal year of 2008, in view of the poor economic prospects due to global financial crisis, the medium term outlook for the exhibition industry is likely to deteriorate. Due to the current financial crisis and the weakening global economy, export businesses of many countries in the Asia Pacific region have declined rapidly. In view of these recent developments in global economy and the expected deterioration of cross-border trading activities, the Directors have reassessed the prospect of its exhibition business and consider the Disposal together with the Master Project Management Agreement represent an opportunity for the Group to (1) reduce its financial burden in relation to licence fees to be paid for the exhibition venues; (2) maintain the flexibility to participate in potentially profitable exhibitions given its first refusal right; and (3) focus on the mining business and allocate its resources and cash flows accordingly.

Upon completion of the Disposal and pursuant to the terms of the Master Project Management Agreement, the Company, through Pro-Capital or its subsidiaries, will engage in exhibition management and be able to retain the revenue stream from the exhibitions managed by its subsidiaries, after deducting a fixed percentage of revenue payable to Group Idea, without taking the risk on the facilities licence fees payable for the relevant exhibition venues. The Company will also focus on the mining sector. It will continue to have sufficient operations and assets after the Disposal.

Upon completion of the Disposal, Group Idea will take up all the costs and obligations in connection with the facilities licences, amounting to approximately HK$33 million for 2009 and will be responsible for formulating strategy so as to promote the exhibitions internationally in order to boost the sign up rate from the exhibitors. The Board, including the independent non-executive Directors, considers acting as the exhibition manager will allow the Group to maintain the revenue stream in relation to the exhibition business while minimising its costs in associated with the facilities licences. The arrangement with Group Idea will provide the Company with the flexibility to allocate the resources among its exhibition and mining businesses. The revenue sharing arrangement contemplated under the Master Project Management Agreement, the amount of which is based on a percentage of revenue to be received from exhibitions managed by the Group, is directly linked to the sign up rate of the exhibitors. The Board, including the independent non-executive Directors, is of the view that the Master Project Management Agreement together with the revenue sharing arrangement are in the interest of the Company and its shareholders as a whole.

PROPOSED RESIGNATION OF DIRECTORS

Upon completion of the Disposal, it is proposed that Mr. Cheung Shui Kwai and Mr. Javed Iqbal Khan will resign as the executive Directors in order to devote more time in designing the business strategy and promoting the exhibitions internationally on behalf of Group Idea. Separate announcement will be made by the Company as and when appropriate when such resignations become effective.

9

LETTER FROM THE BOARD

LISTING RULES IMPLICATION

Mr. Cheung Shui Kwai and Mr. Javed Iqbal Khan are executive Directors and would have been Directors within the preceeding 12 months if they were to resign upon completion of the Disposal as proposed. Accordingly, the Purchasers are connected persons of the Company within the meaning of the Listing Rules and the Disposal constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the Disposal is on normal commercial terms and each of the applicable percentage ratios of the Disposal is less than 2.5%, the Disposal is exempted from the Independent Shareholders’ approval requirement and is only subject to the reporting and announcement requirements under Chapter 14A of the Listing Rules. However, under the Sale and Purchase Agreement, the completion of the Disposal is subject to the approval of the Master Project Management Agreement by the Independent Shareholders at the EGM.

Upon completion of the Disposal, Group Idea will become an associate (within the meaning ascribed to it under the Listing Rules) of Mr. Cheung Shui Kwai. For the same reason as mentioned above, the transaction contemplated under the Master Project Management Agreement constitutes a continuing connected transaction of the Company under Chapter 14A of the Listing Rules. As the applicable percentage ratio in connection with the revenue sharing under the Master Project Management Agreement is more than 2.5% and the total annual consideration is expected to be more than HK$10 million, the Master Project Management Agreement and the corresponding annual cap amounts are subject to the reporting, announcement and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules. The Purchasers and their respective associates (within the meaning ascribed to it under the Listing Rules), shall abstain from voting on the respective resolution at the EGM.

EGM

The EGM will be held at 10:00 a.m. on Monday, 6 April, 2009 at 30/F, One Kowloon, No.1 Wang Yuen Street, Kowloon Bay, Kowloon, Hong Kong for the purpose of seeking Independent Shareholders’ approval on the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts. The Purchasers and their respective associates (within the meaning ascribed to it under the Listing Rules), will abstain from voting in respect of the resolutions relating to the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts. A notice of the EGM is set out on pages 29 to 30 of this circular.

A form of proxy for use at the EGM is enclosed. Whether or not you are able to attend the EGM, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wan Chai, Hong Kong, as soon as possible and in any event so as to be received by the Company’s share registrar not later than 48 hours before the time appointed for holding the EGM or for any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the EGM or any adjourned meeting should you so wish.

10

LETTER FROM THE BOARD

RECOMMENDATION

The Board, including the independent non-executive Directors, considers that the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts are on normal commercial terms and are fair and reasonable so far as the shareholders are concerned and are in the interests of the Company and its shareholders as a whole. Accordingly, the Board recommends the shareholders of the Company to vote in favour of the ordinary resolution to be proposed at the EGM.

Partners Capital has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts.

Your attention is also drawn to the letter from the Independent Board Committee set out on pages 12 to 13, the letter of advice from Partners Capital to the Independent Board Committee and the Independent Shareholders set out on pages 14 to 23 and other information set out in the Appendix to this circular.

By order of the Board Chow Chi Fai Company Secretary

11

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

==> picture [58 x 67] intentionally omitted <==

SINO RESOURCES GROUP LIMITED (carrying on business in Hong Kong as Sino Gp Limited) 神州資源集團有限公司[*]

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 223)

19 March, 2009

To the Independent Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTION IN RELATION TO THE MASTER PROJECT MANAGEMENT AGREEMENT

We refer to the circular dated 19 March 2009 of the Company (the “Circular”) of which this letter forms part. Terms defined in the Circular shall have the same meanings herein unless the context otherwise requires.

We have been appointed to form the Independent Board Committee to consider and to advise the Independent Shareholders as to whether, in our opinion, the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned. Partners Capital has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts.

We wish to draw your attention to the “Letter from the Board” set out on pages 3 to 11 of the Circular which contains, inter alia, information of the abovementioned transactions, as well as the letter from Partners Capital set out on pages 14 to 23 of the Circular which contains its advice in respect of the terms of the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts.

• For identification purpose only

12

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having taken into account the advice of Partners Capital, we consider that the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned and are in the interests of the Company and the Independent Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the EGM in respect of the Master Project Management Agreement, the transaction contemplated thereunder and the annual cap amounts.

Yours faithfully,

Independent Board Committee

Mr. Cheng Wing Keung, Raymond Mr. Cheng Hong Kei Mr. Lu Xin

Independent non-executive Directors

13

LETTER FROM PARTNERS CAPITAL

==> picture [217 x 33] intentionally omitted <==

Partners Capital International Limited Unit 3906, 39/F, COSCO Tower 183 Queen’s Road Central Hong Kong

19 March 2009

To the Independent Board Committee and the Independent Shareholders

Dear Sirs,

CONTINUING CONNECTED TRANSACTION IN RELATION TO THE MASTER PROJECT MANAGEMENT AGREEMENT

INTRODUCTION

We refer to our engagement to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Master Project Management Agreement, the transaction contemplated thereunder (the “Continuing Connected Transaction”) and the annual cap amounts thereof (the “Proposed Caps”), particulars of which are set out in the letter from the Board (the “Letter from the Board”) of the circular to the shareholders of the Company dated 19 March 2009 (the “Circular”) and in which this letter is reproduced. Unless the context requires otherwise, capitalised terms used in this letter shall have the same meanings as given to them under the definitions section of the Circular.

As set out in the Letter from the Board, on 26 February 2009, the Purchasers and Pro-Capital entered into the Sale and Purchase Agreement pursuant to which, subject to the satisfaction of certain conditions, the Purchasers agreed to purchase and Pro-Capital agreed to sell the entire issued share capital of Group Idea, a wholly-owned subsidiary of the Company, and its loan owed to Pro-Capital for a consideration of HK$5 million payable in cash. Group Idea is an investment holding company holding seven annual facilities licences for the use of certain exhibition halls during the relevant licensed periods. Upon completion of the Disposal, the Purchasers will bear all the costs and obligations in connection with these facilities licences and will be responsible for formulating strategy so as to promote the exhibitions internationally. It was stipulated under the Sale and Purchase Agreement that at the completion of the Disposal, Pro-Capital shall have duly executed the Master Project Management Agreement. Under the Master Project Management Agreement, Group Idea will grant a first refusal right to Pro-Capital (for itself and on behalf of its subsidiaries), at a consideration of HK$1, to act as the project manager in relation to the provisions of certain management services for the exhibitions and trade fairs to be organised by Group Idea from time to time for the next three years ending 31 December 2011. These exhibitions include those seven exhibitions under the seven licence agreements (the “Licence Agreements”), details of which are set out in the paragraph headed “Information about Group Idea” in the Letter from the Board, and such other exhibition(s), trade fair(s), show(s) and project(s) which Group Idea is entitled to organise in any part of the world from time to time during the three years ending 31 December 2011.

14

LETTER FROM PARTNERS CAPITAL

Given that Mr. Cheung Shui Kwai and Mr. Javed Iqbal Khan are executive directors of the Company, the Purchasers are connected persons of the Company within the meaning of the Listing Rules. Upon completion of the Disposal, Group Idea will become an associate of Mr. Cheung Shui Kwai. Accordingly, the transaction contemplated under the Master Project Management Agreement constitutes a continuing connected transaction of the Company under Chapter 14A of the Listing Rules. As the applicable percentage ratio in connection with the revenue sharing under the Master Project Management Agreement is more than 2.5% and the total annual consideration is expected to be more than HK$10 million, the Master Project Management Agreement and the Proposed Caps are subject to approval by the independent shareholders of the Company at the EGM by way of poll. In this regard, Partners Capital has been appointed as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the terms of the Continuing Connected Transaction (including the Proposed Caps).

Partners Capital is not connected with the directors, chief executive and substantial shareholders of the Company or any of its subsidiaries or their respective associates and is independent pursuant to Rule 13.84 of the Listing Rules and is therefore considered suitable to give independent advice to the Independent Board Committee and the Independent Shareholders. Apart from normal professional fees payable to Partners Capital in connection with this appointment, no arrangement exists whereby Partners Capital will receive any fees or benefits from the Company or the directors, chief executive and substantial shareholders of the Company or any of its subsidiaries or their respective associates.

In formulating our opinion, we have relied on the accuracy of the information and representations contained in the Circular and have assumed that all information and representations made or referred to in the Circular were true at the time they were made and continue to be true as at the date of the Circular. We have also relied on our discussion with the management of the Company regarding the Group and the respective terms and conditions of the Continuing Connected Transaction, including the information and representations contained in the Circular. We have also assumed that all statements of belief, opinion and intention made by the Directors and the Company in the Circular were reasonably made after due enquiry. We consider that we have reviewed sufficient information to reach an informed view, to justify our reliance on the accuracy of the information contained in the Circular and to provide a reasonable basis for our advice. We have no reason to suspect that any material facts have been omitted or withheld from the information contained or opinions expressed in the Circular nor to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors. We have not, however, conducted an independent in-depth investigation into the business and affairs of the Group, the Company, Group Idea, Pro-Capital, the Purchasers and their respective associates nor have we carried out any independent verification of the information supplied.

15

LETTER FROM PARTNERS CAPITAL

THE TERMS OF THE CONTINUING CONNECTED TRANSACTION AND THE PROPOSED CAPS

Principal factors and reasons considered

In arriving at our opinion regarding the terms of the Continuing Connected Transaction and the Proposed Caps, we have considered the following principal factors and reasons:

1. Background of and reasons for the terms of the Continuing Connected Transaction and the Proposed Caps

The principal activities of the Group are production and sales of coal in the People’s Republic of China, and organisation of exhibitions and trade shows and providing related ancillary services.

The Group has diversified its businesses into the mining sector during 2008 after the Group’s businesses in the exhibition sector have been loss making in the past several years. Although the Directors expect to see the exhibition sector turning around for the fiscal year of 2008, in view of the economic prospects having declined drastically due to the global financial crisis, the medium term outlook for the exhibition industry is likely to deteriorate.

Due to the current financial crisis and the weakening global economy, export businesses of many countries in the Asia Pacific region have declined rapidly. In view of these recent developments in the global economy and the expected deterioration of cross-border trading activities, the Directors have reassessed the prospect of its exhibition business and consider that the Disposal together with the Master Project Management Agreement represent an opportunity for the Group to (1) reduce its financial burden in relation to licence fees to be paid for the exhibition venues; (2) maintain the flexibility to participate in potentially profitable exhibitions given its first refusal right; and (3) focus on the mining business and allocate its resources and cash flows accordingly.

Upon completion of the Disposal and pursuant to the terms of the Master Project Management Agreement, the Company, through Pro-Capital or its subsidiaries, will engage in exhibition management and will be able to retain a revenue stream from the exhibitions managed by Pro-Capital or its subsidiaries, after deducing a fixed percentage of revenue without taking the full risk on the facilities licence fees payable for the relevant exhibition venues. The Company will also focus on the mining sector and will have a sufficient level of operation and assets after the Disposal.

As advised by the Company, the main portion of the revenue of the Group in the past, before its business diversification into the mining sector during 2008, has been generated from the series of Mega Show held in Hong Kong and the Group launched new series of Mega Macao in October 2007 with a view to broaden its revenue source. As further advised by the Company, the majority of revenue from an exhibition was the participation fees paid by exhibitors. A decrease in the number of exhibitors would have negative impact on the revenue and profitability of an exhibition in general.

16

LETTER FROM PARTNERS CAPITAL

According to the annual report of Hong Kong Trade Development Council (HKTDC), HKTDC hosted 33 fairs during the year ended 31 March 2008, which attracted more than 27,000 exhibitors, of which nearly 14,000 were local participants and more than 13,400 were from outside Hong Kong. Those fairs attracted nearly 583,000 trade buyers, with about 285,000 being local buyers and more than 297,000 coming from outside Hong Kong. We tabulate the number of exhibitors and buyers who participated at the HKTDC trade fairs for the last six years below:

	2002/03	2003/04	2004/05	2005/06	2006/07	2007/08
Participants at HKTDC trade fairs
– Exhibitors	13,527	15,200	21,400	23,200	>27,000	>27,400
– Buyers	~310,000	330,300	483,600	514,000	622,000	~583,000
Number of trade fairs organized by	17	17	21	19	31	33
HKTDC

Source: annual reports of HKTDC

We also tabulate below the number of exhibitors and buyers of the major recurrent fairs organised by the Group under the licence agreements for the last three years and the latest result from the Asia Expo in London in January 2009. The aggregate turnover generated from such recurrent fairs accounted for more than 90% of the total turnover of the Group in respect of the businesses in the exhibition section each year and hence, we consider that the historical data of these fairs would be representative for our analysis.

Mega Show

Mega Show
		2006	2007	2008
Mega Show Part 1
– Exhibitors		3,475	3,348	3,218
– Buyers		61,638	60,944	52,836
Mega Show Part 2
– Exhibitors		879	677	660
– Buyers		13,765	11,594	14,439
Total visitors for Mega Show		75,403	72,538	67,275
Source: certification reports from HLB Hodgson Impey Cheng provided by the Company
Asia Expo London
	2006	2007	2008	2009
– Exhibitors	606	604	494	235
– Buyers	8,605	10,161	9,231	6,057

Source: certification reports from HLB Hodgson Impey Cheng provided by the Company

Asia Expo London

Source: certification reports from ExhibitAudit Co. provided by the Company

17

LETTER FROM PARTNERS CAPITAL

Mega Macao

Mega Macao
	2007 Fall	2008 Spring	2008 Fall
– Exhibitors	923	946	N/A_(Note)_
– Buyers	8,789	8,547	N/A_(Note)_

Source: certification reports from HLB Hodgson Impey Cheng provided by the Company

Note: the Mega Macao (a.k.a. Kenfair Fall Expo 2008) was not held and will be postponed to a later date to be agreed between Group Idea and the relevant licensor

Although the numbers of HKTDC trade fairs and exhibitors participating in those trade fairs have been increasing in general since the financial year ended 31 March 2003, we note that the number of buyers started to drop in the year ended 31 March 2008. Besides, we note that the numbers of exhibitors and buyers of Mega Show and Asia Expo London have been decreasing in general since 2006. In addition, as advised by the Company, it is likely that the number of participating exhibitors would decline in certain exhibition for future years if the popularity and/or attractiveness of such exhibition decreases (as implied by the level of buyers attending such exhibition). Moreover, as a result of the global financial crisis, the Directors expect that the number of exhibitors and buyers may continue to drop due to cuts in marketing budgets, which may in turn have a negative impact on the revenue of the Group’s businesses in exhibition sector.

On the other hand, as set out in the Letter from the Board, all the costs and obligations in connection with the facilities licences amounted to approximately HK$33 million for 2009. As a result of the Disposal, Group Idea will take up such costs and obligations and the Group would shift this financial burden to Group Idea. Pursuant to the Master Project Management Agreement, Pro-Capital and/or its subsidiaries shall provide the management services and procure the provision of such services to Group Idea, including but not limited to providing human resources support; providing advertising, marketing and other promotional support; managing and overseeing the operation of the exhibition and ensuring the smooth and efficient running of the exhibition; arranging for construction, removal and selling of booths; keeping proper books and records for the exhibition and such other matters as the project manager shall consider necessary to carry out or perform its duties under the Master Project Management Agreement.

As advised by the Company, the Group has been conducting surveys of exhibitors and buyers after each exhibition to obtain their feedback for the purpose of improving the quality of its exhibitions and gathering the intention of attendance of these exhibitors and buyers for the forthcoming show of the same exhibition. The Group also maintains a database of buyers, visitors and exhibitors which has been accumulated and regularly updated for over 10 years. Leveraging on the experience and expertise of the management teams of the Company in respect of the exhibition businesses, the Company prepares a forecast for attendance based on indications by exhibitors and buyers and macro overview of the economy and such estimate will be used as a reference to determine whether or not it will act as the manager for future exhibition.

18

LETTER FROM PARTNERS CAPITAL

Besides, as further advised by the Directors, the negotiation for booking a venue usually takes place approximately one year in advance and the relevant agreements would be entered into approximately one year in advance. Thus, under the mode of operation before the Disposal and the Master Project Management Agreement, the Group has to face great uncertainty as to the attendance level of an exhibition since it has to commit by booking such venue approximately one year in advance. In addition, pursuant to the respective terms of the Licence Agreements, although the licencee is allowed to cancel the relevant Licence Agreement within one year from the first date of the respective licensed period, the licencee has to pay a heavy penalty ranging from 70% to 100% of the licence fees together with any other outstanding amount. On the contrary, upon completion of the Disposal and upon entering into the Master Project Management Agreement, the Group is allowed to decide whether or not to participate in any of the exhibitions (other than the exhibitions to be held in Macao in October 2009 under the Licence Agreements which Pro-Capital should indicate within 14 days after the date of the Master Project Management Agreement whether or not it will manage such exhibitions) to be organised by Group Idea within the acceptance period ending eight months before the date of commencement of the licence period of the relevant exhibition during the three years ending 31 December 2011. Hence, the Master Project Management Agreement provides flexibility to the Company to share the revenue of any exhibition without bearing in advance the fixed licence fees.

Furthermore, as advised by the Company, the licence fees under the Licence Agreements are required to be paid by the licencee in stages in advance of the hosting of the relevant exhibition whereas under the Master Project Management Agreement and as advised by the Directors, Pro-Capital is required to share its revenue of each relevant exhibition after the relevant exhibition is closed in general and the actual payment schedule shall be agreed between Group Idea and Pro-Capital. In this regard, the Group’s cashflow and liquidity position will be improved in general.

As such, although there is significant uncertainty in respect of the impact of global financial crisis on the exhibition industry and the prospects of the exhibition business remain challenging, we consider that the Disposal together with the Master Project Management Agreement would allow the Company to shift certain of its risks to the Purchasers whilst maintaining an opportunity to capture the possible upside from the exhibition industry under the Master Project Management Agreement.

Based on the above, we consider that it is fair and reasonable and in the interests of the Company and its shareholders as a whole for the Group to enter into the Master Project Management Agreement with Group Idea for preserving the opportunity to enjoy the potential upside from the exhibition industry at a reduced level of financial burden and allowing the Company to consolidate its resources towards the mining business.

2. The Proposed Caps for the Continuing Connected Transaction

Pursuant to the Master Project Management Agreement, Group Idea will share 20% of the revenue in respect of each exhibition managed by Pro-Capital and/or its subsidiaries. In addition, Group Idea will grant a first refusal right to Pro-Capital (for itself and on behalf of its subsidiaries), at a consideration of HK$1, to act as the project manager to provide exclusively certain management services for the exhibitions and trade fairs to be organised by Group Idea from time to time during the three years ending 31 December 2011. The provision of the management services shall be on normal commercial terms and shall be on terms no more favourable than those from time to time applicable to similar services quoted by members of the Group to other independent parties not related to Group Idea and/or its associates. The

19

LETTER FROM PARTNERS CAPITAL

Continuing Connected Transaction will be a new continuing connected transaction of the Company and the Company has never been engaged as project manager of the exhibitions and trade fairs by any independent third party. Accordingly, we were advised by the Company that there were no comparable transactions available for our direct comparison.

The Directors propose the annual cap amounts of the sums of such shared revenue for the three years ending 31 December, 2011 to be HK$38 million, HK$41 million and HK$41 million respectively. The annual cap amounts were determined after an arm’s length negotiation between the Purchasers and Pro-Capital with reference to the licence fees payable by Group Idea, the outlook and historical performance of these exhibitions and the expertise and network of the Purchasers in promoting the exhibitions internationally. Such annual cap amounts were also determined on the assumption that ProCapital will act as the project manager for all the exhibitions organised by Group Idea every year in the coming three years and the revenue from these exhibitions remains the same as they were in 2008.

With regard to the proposed annual caps for the Master Project Management Agreement to be sought for the three financial years ending 31 December 2011, we have obtained from the Directors the historical revenue generated from the same exhibitions held in the previous year. We understand from the Directors that Group Idea will bear all the costs and obligations in connection with the facilities licences which would mainly consist of the rental expenses for the venues and the rental expenses in general roughly accounted for 15% of the total revenue generated from all the relevant exhibitions in the past. We were advised by the Directors that the estimated level of revenue was arrived at with reference to the historical revenue generated from the same exhibitions held in the previous year which would be covered under the Licence Agreements. We were also advised by the Company that the annual cap amounts were determined on the assumption that Group Idea will be able to obtain the licences for the relevant exhibitions mentioned above for the next three years ending 31 December 2011. As advised by the Company, Group Idea has not entered into any agreement for organising exhibitions other than those under the Licence Agreements as at the Latest Practicable Date. We have reviewed the internal estimates of the Company in relation to the Proposed Caps and we note that the internal estimates were prepared with reference to historical trend of the cost structure and historical revenue of the Group. We consider such basis of preparation of the Proposed Caps to be in line with the market practice.

Pursuant to the Master Project Management Agreement, Group Idea will share 20% of the revenue in respect of each exhibition managed by Pro-Capital and/or its subsidiaries. Pro-Capital has indicated (for itself and on behalf of its subsidiaries) its willingness to act as the project manager to provide the management services in respect of all the exhibitions to be held in Hong Kong, namely Mega Show Part 1 & 2 and Gifts, Decor & Home at Hong Kong Convention and Exhibition Centre in 2009. The Board is still reviewing the opportunity to act as the project manager for the exhibitions to be held in Macao in October 2009 and London in 2010 and 2011. As confirmed by the Directors, the Group did not hold the exhibition in Macao in October 2008 and such exhibition will be postponed to a later date to be agreed between Group Idea and the relevant licensor and the coming exhibition in Macao in April 2009 is also being postponed.

In light of the fact that the Continuing Connected Transaction will be a new continuing connected transaction of the Company and there were no comparable transactions available for our direct comparison, we attempt to assess the fairness and reasonableness of the Proposed Caps from another angle. As advised by the Company, the licence fees paid to the licensors, who are the owner/operator

20

LETTER FROM PARTNERS CAPITAL

of the venues, by the Group for the twelve months ended 31 December 2008 amounted to an aggregate of approximately HK$33 million. The aggregate revenue generated from these exhibitions held in 2008 amounted to approximately HK$205 million. Accordingly, the licence fees would represent approximately 15.6% of the revenue for 2008 and the Directors confirmed that this is roughly in line with past pattern of the Company. We note that the Proposed Caps, which could be treated as the licence fees prepaid by the Purchasers, would be comparable to the historical level of aggregate licence fee paid by the Group in the past and we consider that it is justifiable for the Purchasers to request for a compensation, in the form of charging a margin over the historical rate of licence fees, for bearing the advance payments of licence fees and granting the Company the first refusal right. In addition, as further advised by the Company, the staff cost (including salary and commission) would account for around 24% of the revenue generated from the exhibition business in general whilst the remaining operating expenses consist of advertising expenses, agency commission, subcontracting charges and other ancillary services charges. These operating expenses are variable costs and would usually be directly related to the number of exhibitors attending a certain exhibition as well as the revenue generated from these exhibitors. We have obtained the management analysis of the Company in relation to the relevant costs and expenditures of the relevant exhibitions held in 2008 and we note that the cost structure is generally in line with the historical pattern of the Company.

In the event that the Company decided not to manage a certain exhibition under the Licence Agreements and/or any other exhibitions to be organised by Group Idea, the Company would not have to spend on advertising, employment of temporary staff, procurement of subcontracting work in respect of exhibition booths and other exhibition costs such as ancillary services for that particular exhibition. Thus, these variable costs could be avoided. At the same time, although Pro-Capital is required to share 20% of its revenue from certain exhibition it would act as project manager with Group Idea, which could be considered as payment of licence fees plus a premium for obtaining the first refusal right, such sum will be variable and the Company does not need to bear all the licence fees in full.

Although it is uncertain as to the attendance level of each exhibition at this early stage, the Directors expect that the revenue to be generated from certain of the exhibitions under the Licence Agreements would be lower than the revenue from certain of the exhibitions held previously in 2008 and 2009 (as the case may be) as a result of the recent global financial crisis. In the extreme case where the revenue from a certain exhibition under the Licence Agreements and/or other exhibitions managed by Pro-Capital were zero, Pro-Capital would not be required to pay Group Idea any sum for managing that exhibition. Hence, by entering into the Master Project Management Agreement, the Company is expected to be better off in terms of the costs in general.

Having taking into account the above factors, in particular, the following:

• (i) the licence fees, which have been accounted for in general roughly 15% of the revenue of the Group’s exhibition business in the past, would be a fixed commitment whereas the revenue sharing arrangement under the Master Project Management Agreement of 20% would be a variable expense subject to the number of exhibitions to be managed by Pro-Capital and the actual revenue to be generated therefrom;

• (ii) the risk of bearing the commitment of the licence fees under the Licence Agreements has been shifted to the Purchasers and the Company has the flexibility to share the revenue of any particular exhibition without bearing in advance the fixed licence fees; and

21

LETTER FROM PARTNERS CAPITAL

• (iii) the Company could adjust the variable costs for holding any particular exhibition in accordance to the attendance level of the exhibitors or even avoid those variable costs for not acting as manager for some of the exhibitions to be organised by Group Idea,

we consider that the Continuing Connected Transaction is to be carried out on normal commercial terms and in the ordinary and usual course of business and the bases on which the Proposed Caps were determined are fair and reasonable and in the interests of the Company and its shareholders as a whole.

3. The conditions

As the Proposed Caps will exceed HK$10 million and the relevant applicable ratios under Rule 14.07 of the Listing Rules exceed 2.5%, the Proposed Caps of the Continuing Connected Transaction are subject to reporting, announcement, and the requirement of seeking approval from the Independent Shareholders under the Listing Rules.

The Company will therefore seek the approval by the Independent Shareholders of the Master Project Management Agreement and the Proposed Caps subject to the following conditions:

1. The Continuing Connected Transaction will be:

2. (i) entered into by the Group in the ordinary and usual course of its business;

3. (ii) conducted on normal commercial terms or, if there are no sufficient comparable transactions to judge whether they are on normal commercial terms, on terms no less favourable to the Company than terms available to or from independent third parties; and

4. (iii) entered into in accordance with the terms of the Master Project Management Agreement governing the Continuing Connected Transaction that are fair and reasonable and in the interests of the shareholders of the Company as a whole;

5. The transacted amount of the transactions under the Continuing Connected Transaction shall not exceed the Proposed Caps;

6. The Company will comply with all other relevant requirements under the Listing Rules.

Taking into account the conditions attached to the Continuing Connected Transaction, in particular (i) the restriction by way of setting the Proposed Caps; and (ii) the compliance with all other relevant requirements under the Listing Rules (which include the annual review and/or confirmation by the independent non-executive Directors and auditors of the Company on the actual execution of the Continuing Connected Transaction), we consider that the Company has taken appropriate measures to govern the Group in carrying out the Continuing Connected Transaction, thereby safeguarding the interests of the shareholders of the Company thereunder.

22

LETTER FROM PARTNERS CAPITAL

Recommendation

Having considered the above principal factors, we are of the opinion that the terms of the Master Project Management Agreement, the Continuing Connected Transaction and the Proposed Caps are fair and reasonable and are in the interests of the Company and its shareholders as a whole. We consider that the Continuing Connected Transaction is to be carried out on normal commercial terms and in the ordinary course of business of the Company. Accordingly, we recommend the Independent Board Committee to advise the Independent Shareholders, and we advise the Independent Shareholders, to vote in favour of the ordinary resolution to be proposed at the EGM for approving the Master Project Management Agreement and the Proposed Caps.

Yours faithfully, For and on behalf of

Partners Capital International Limited Alan Fung Managing Director

23

GENERAL INFORMATION

APPENDIX

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 the omission of which would make any statement herein misleading.

2. DISCLOSURE OF INTERESTS OF DIRECTORS AND CHIEF EXECUTIVE OF THE COMPANY

As at the Latest Practicable Date, the interests and short positions, if any, of each Director and chief executive of the Company in any shares, underlying shares and debentures of the Company and any associated corporation (within the meaning of Part XV of the SFO) which were required to be (i) 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 the Directors and chief executive of the Company was taken or deemed to have under such provisions of the SFO); or (ii) entered in the register kept by the Company pursuant to section 352 of the SFO; or (iii) notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies were as follows:

(i) Long positions in the shares of the Company

	Number of		Approximate
	shares		percentage
Name of directors	interested	Capacity	holding of shares
Mr. Hung Chen, Richael	423,640,000	Beneficial owner	45.27%
(Note 1)	198,000,000	Interest of a controlled	21.16%
		corporation
Mr. Ip Ki Cheung_(Note 2)_	1,000,000	Beneficial owner	0.11%
	45,000,000	Interest of a controlled	4.81%
		corporation
Mr. Fong Wang	200,000	Beneficial owner	0.02%
Mr. Khan Javed Iqbal	400,000	Beneficial owner	0.04%

Note:

1. Mr. Hung Chen, Richael is beneficially interested in 100% of the entire issued share capital of Mega Wealth Capital Limited (“Mega Wealth”) and 100% of the entire issued share capital of Webright Limited (“Webright”).

These 198,000,000 shares include the 100,000,000 shares owned by Mega Wealth representing 10.69% of the entire issued shares of the Company and the 98,000,000 shares owned by Webright representing 10.47% of the entire issued shares of the Company as at Latest Practicable Date. Accordingly, Mr. Hung Chen, Richael is deemed to be interested in 621,640,000 shares of the Company under the SFO.

24

GENERAL INFORMATION

APPENDIX

1. Mr. Ip Ki Cheung is beneficially interested in 50% of the entire issued share capital of Capital Concord Profits Limited (“Capital Concord”) which in turn holds 45,000,000 shares representing 4.81% of the entire issued shares of the Company as at Latest Practicable Date. Accordingly, Mr. Ip Ki Cheung is deemed to be interested in 46,000,000 shares of the Company under the SFO.

(ii) Long positions in the underlying shares of equity derivatives of the Company

Mr. Hung Chen, Richael is interested in 347,000,000 underlying shares of the Company through a non-interest bearing convertible redeemable note issued by the Company to him which can be converted into 347,000,000 shares of the Company at an initial conversion price of HK$0.50 per share (subject to adjustments).

Save as disclosed above, as at Latest Practicable Date, none of the Directors or chief executive of the Company had any beneficial interest (including interests or short positions) in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO, which would be required to be (i) notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including the interests and short positions which the Directors or the chief executive were taken or deemed to have taken under such provisions of the SFO), or (ii) entered in the register kept by the Company pursuant to section 352 of the SFO, or (iii) notified to the Company and the Stock Exchange, pursuant to the Model Code for Securities Transactions by directors of Listed Issuers in the Listing Rules.

As of the Latest Practicable Date:

1. Mr. Hung Chen, Richael is a director of both Mega Wealth and Webright;

2. Mr. Ip Ki Cheung is a director of both Capital Concord and Best Aims Finance Limited, which held 50% of the issued share capital of Capital Concord;

3. Mr. Cheung Shui Kwai is a director of both Capital Concord and Harbour Rich Finance Limited, which held 30% of the issued share capital of Capital Concord; and

4. Mr. Chan Siu Chung is a director of both Capital Concord and Pace Maker Finance limited, which held 20% of the issued share capital of Capital Concord.

Save as disclosed above, none of the Directors was a director or an employee of a company which has 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.

25

GENERAL INFORMATION

APPENDIX

3. EXPERT AND CONSENT

The following is the qualification of the expert who has been named in this circular or have given opinion or advice contained in this circular:

Name Qualification Partners Capital a licensed corporation to conduct Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities under the SFO

As at the Latest Practicable Date, Partners Capital had confirmed that it is not interested in the share capital of any member of the Group nor has any right, whether legally enforceable or not, to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

Partners 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 included in this circular in the form and context in which they appear.

The letter and recommendation given by Partners Capital is given as of the date of this circular for incorporation herein.

As at the Latest Practicable Date, Partners Capital had confirmed that it does not have any direct or indirect interests in any assets which have been acquired or disposed of by, or leased to, any member of the Group or are proposed to be acquired of by, or leased to, any member of the Group since 31 March, 2008, being the date to which the latest published audited financial statement of the Group was made up.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors entered or proposed to enter into any service contract with any member of the Group which is not determinable by the employer within one year without payment of compensation other than statutory compensation.

5. DIRECTORS’ INTERESTS IN ASSETS AND/OR CONTRACTS AND OTHER INTERESTS

As at the Latest Practicable Date, none of the Directors has 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 are proposed to be acquired or disposed of by, or leased to any member of the Group since 31 March 2008, being the date to which the latest published audited financial statement of the Group was made up.

Mr. Hung Chen, Richael, an executive Director, has entered into a sale and purchase agreement on 25 September 2007 (as supplemented by supplemental agreements dated 26 October 2007, 20 December 2007, 24 December 2008 and 5 March 2009 respectively) with the Company in relation to acquisition of Wealth Gain Global Investment Limited.

26

GENERAL INFORMATION

APPENDIX

Mr. Hung Chen, Richael has also entered into two loan agreements with the Company on 4 December 2008 and 4 March 2009 pursuant to which he agreed to provide loan facilities of HK$3,000,000 and HK$8,000,000 to the Company respectively. Each of the loans under the above-mentioned agreements is for a term of one year and will bear interest of 8% per annum.

Save as disclosed above, none of the Directors is materially interested in any contract or arrangement entered into by any member of the Group which contract or arrangement was subsisting at the Latest Practicable Date and which was significant in relation to the business of the Group taken as a whole.

As at the Latest Practicable Date, none of the Directors and their respective associates, within the meaning ascribed to it under the Listing Rules, had any interest in a business, apart from the business of the Company, which competes or may compete, either directly or indirectly, with the business of the Group.

6. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 March, 2008, being the date to which the latest audited consolidated financial statements of the Group were made up.

7. UPDATE ON COAL MINE ACQUISITION

Pursuant to a sale and purchase agreement entered into on 25 September 2007 (as supplemented by three supplemental agreements dated 26 October 2007, 20 December 2007 and 24 December 2008 respectively) between the Company and Mr. Hung Chen, Richael, an executive Director (the “Vendor”) in relation to the acquisition of Wealth Gain Global Investment Limited (“Target Company”) (the acquisition of the Target Company referred to below as the “Transaction”), the Company was due to pay the Vendor HK$158.6 million (being the balance of the consideration for the acquisition of Target Company) by 28 February 2009. On 5 March 2009, the Company and the Vendor entered into a further supplemental agreement to extend the due date for the payment of the said HK$158.6 million to 16 April 2009. The Directors will endeavour to raise the necessary funds to pay the Vendor by the extended due date. However, there is no certainty that the funds can be raised.

The Company has been notified by the Stock Exchange that it has received certain complaints in respect of the Transaction. The Company is currently reviewing such complaints and has appointed professional advisors to advise on this matter. Further announcement(s) will be made to update shareholders in this connection as and when appropriate in accordance with the requirements of the Listing Rules.

27

GENERAL INFORMATION

APPENDIX

8. DOCUMENTS FOR INSPECTION

Copies of the following documents will be available for inspection during normal business hours (Saturdays and public holidays excepted) at the principal place of business of the Company in Hong Kong at 30/F, One Kowloon, No. 1 Wang Yuen Street, Kowloon Bay, Kowloon, Hong Kong from the date of this circular up to and including the date of the EGM (both dates inclusive):

• (a) the letter from the Independent Board Committee as set out on page 12 to 13 of this circular;

• (b) the letter from Partners Capital as set out on page 14 to 23 of this circular;

• (c) the written consent of Partners Capital as referred to in paragraph headed “Experts and consents” of this appendix; and

• (d) the Sale and Purchase Agreement (which contains the agreed form of the Master Project Management Agreement).

28

NOTICE OF EGM

==> picture [58 x 67] intentionally omitted <==

SINO RESOURCES GROUP LIMITED (carrying on business in Hong Kong as Sino Gp Limited) 神州資源集團有限公司[*]

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 223)

NOTICE OF 2009 FIRST

EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY given that the 2009 first extraordinary general meeting (the “EGM”) of the Company will be held at 10:00 a.m. on Monday, 6 April, 2009 at 30/F, One Kowloon, No.1 Wang Yuen Street, Kowloon Bay, Kowloon, Hong Kong for the purpose of considering and, if thought fit, passing the following ordinary resolution:

“THAT:

1. the Master Project Management Agreement (as defined in the circular of the Company dated 19 March 2009, a copy of the agreed form has been produced to the EGM marked “A” and signed by the chairman of the EGM for the purpose of identification), and the terms and conditions thereof and the transaction contemplated thereunder and the annual cap amounts thereof be and are hereby approved; and

2. any one of the directors of the Company (“Director(s)”) be authorised for and on behalf of the Company, among other matters, to sign, execute, perfect, deliver or to authorise signing, executing, perfecting and delivering the Master Project Management Agreement and all such documents and deeds, to do or authorise doing all such acts, matters and things as he may in his discretion consider necessary, expedient or desirable to give effect to and implement and/or complete all matters in connection with the transactions contemplated in the Master Project Management Agreement and/or the annual cap amounts and to waive compliance from or make and agree such variations of a non-material nature to any of the terms of the Master Project Management Agreement, as he may in his absolute discretion consider to be desirable and in the interests of the Company and all of such Director’s acts as aforesaid be hereby approved, ratified and confirmed.”

By order of the Board Chow Chi Fai Company Secretary

Hong Kong 19 March 2009

• For identification purpose only

29

NOTICE OF EGM

As at the date of this announcement, the Board comprises Mr. Hung Chen, Richael, Mr. Ip Ki Cheung, Mr. Cheung Shui Kwai, Mr. Chan Siu Chung, Mr. Javed Iqbal Khan and Mr. Fong Wang as executive directors, and Mr. Cheng Wing Keung, Raymond, Mr. Lu Xin and Mr. Cheng Hong Kei as independent non-executive directors.

Notes:

1. Any member entitled to attend and vote at a meeting of the Company shall be entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a member.

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

3. The instrument appointing a proxy and the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power or authority, shall be delivered to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong not less than forty-eight (48) hours before EGM. No instrument appointing a proxy shall be valid after the expiration of twelve (12) months from the date named in it as the date of its execution, except at an adjourned meeting or an adjourned meeting in cases where the meeting was originally held within twelve (12) months from such date.

4. Where there are joint holders of any share any one of such joint holder may vote, either in person or by proxy, in respect of such share as if he were solely entitled thereto, but if more than one of such joint holders be present at the EGM the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the register of members in respect of the joint holding.

5. A form of proxy is enclosed. Delivery of an instrument appointing a proxy shall not preclude a member from attending and voting in person at the EGM and in such event, the instrument appointing a proxy shall be deemed to be revoked.

30