G-Resources Group Limited — Capital/Financing Update 2004

Mar 26, 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.

PALADIN LIMITED

(Incorporated in Bermuda with limited liability) (Stock code: 495)

Major Transaction

The Board announced that on 23 March 2004, Magetta Company Limited, a whollyowned subsidiary of the Company, entered into the Provisional Sale and Purchase Agreement with Harbour Time Group Limited for the sale of the property known as Flat A on 21st Floor, The Habour View, No.11 Magazine Gap Road, Hong Kong with carpark No.1 and Ancillary Space No.1A on 1st Floor (the “Property”) at a consideration of HK$38,000,000.

The terms under the Provisional sale and purchase agreement were determined after arm’s length negotiation and were on normal commercial terms. The Board considers that the terms under the Provisional sale and purchase agreement are fair and reasonable in the current market conditions and with reference to the valuation of HK$28 million as at 23 October 2003 made by an independent professional valuer, and are in the best interest of the Company and its shareholders.

The profit on the disposal of the Property is approximately HK$9 million.

The Provisional sale and purchase agreement constitutes a major transaction for the Company under the Listing Rules and must be conditional on shareholders’ approval. Pursuant to Rule 14.10 of the Listing Rules, a written irrevocable approval of the said provisional sale and purchase agreement has been given by Five Star Investments Limited, which is entitled to 50.70% of nominal value of the securities of the Company giving the right to attend and vote at general meeting and has no interest in the disposal of the Property. No shareholder shall abstain from voting at the general meeting. A shareholders’ meeting will therefore not be convened for the purpose of obtaining shareholders’ approval.

A circular containing further details of the Provisional sale and purchase agreement will be dispatched to the shareholders of the Company within 21 days after publication of this announcement.

At the request of the Company, trading of the Shares on the Stock Exchange was suspended with effect from 2:30 p.m. on 23 March 2004. The Company has applied for resumption of trading of the Shares on the Stock Exchange with effect from 9:30 a.m. on 29 March 2004.

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PROVISIONAL SALE AND PURCHASE AGREEMENT Date : 23 March 2004

• Parties : Magetta Company Limited, a wholly-owned subsidiary of the Company, as vendor

Habour Time Group Limited as purchaser

Habour Time Group Limited and its ultimate beneficial owners and their respective associate are independent third parties not connected with the directors, chief executive or substantial shareholders of the Company or any of its subsidiaries or any of their respective associates (as defined in the Listing Rules). The Group has confirmed with each of connected persons (as defined in the Listing Rules) of the Group that they have no interests in the transaction and are not connected with the purchaser.

• Property : Flat A on 21st Floor, The Harbour View, No.11 Magazine Gap Road, Hong Kong with carpark No.1 and Ancillary Space No.1A on 1st Floor. The property has a saleable area of approximately 185.6 sq. m. (1,997.80 sq. ft.).

Consideration : HK$38,000,000

The terms under the provisional sale and purchase agreement were determined after arm’s length negotiation and were on normal commercial terms. The Board considers that the terms under the Provisional sale and purchase agreement are fair and reasonable in the current market conditions and with reference to the valuation of HK$28 million as at 23 October 2003 made by an independent professional valuer, Multiple Surveyors Limited, and are in the best interest of the Company and its shareholders.

PAYMENT TERMS

The cash consideration for the sale of the Property will be paid by the purchaser in the following manner:

1. Initial deposit shall be paid upon signing of the Provisional sale and purchase agreement in the sum of HK$3,800,000.

2. Balance of purchase price shall be paid upon completion on or before 22 April 2004.

FINANCIAL EFFECTS OF DISPOSAL

The property was used as a quarter for a director of subsidiaries. Another quarter which is still under development by the Group will be provided to the director of subsidiaries upon completion. The director is planned to live in a hotel during the interim period. The mortgage loan interest in relation to the Property for the year end 30 June 2003 and 30 June 2002 were HK$0.5 million and 0.4 million respectively. The carrying value of the Property was HK$29.5 million as included in the consolidated audited accounts of the Company for the year ended 30 June 2003. Taking into account the depreciation charged to the profit and loss account upon completion of the disposal of the Property amounting to approximately HK$0.5 million, the profit on the disposal of the Property is approximately HK$9 million.

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REASON FOR THE DISPOSAL

The Board considers that it is in the interest of the Company and its shareholders and the vendor to dispose of the Property as the disposal represents a good opportunity for the Company to realize its investment in the Property so as to reduce its borrowings. Part of the proceeds will be used for full repayment of the mortgage loan of approximately HK$17.5 million due to a bank. The remaining proceeds of HK$20.5 million will be used as the working capital of the Group.

APPROVAL FROM THE MAJOR SHAREHOLDER

The Provisional sale and purchase agreement constitutes a major transaction for the Company under the Listing Rules and must be made conditional on shareholders’ approval. Pursuant to Rule 14.10 of the Listing Rules, a written irrevocable approval of the entering of the Provisional sale and purchase agreement has been given by Five Star Investments Limited, which is entitled to 50.70% of nominal value of the securities of the Company giving the right to attend and vote at general meeting and has no interest in the disposal of the Property. No shareholder shall abstain from voting at the general meeting. A shareholders’ meeting will therefore not be convened for the purpose of obtaining shareholders’ approval.

GENERAL

The principal activities of the Group are the trading of textiles and re-development of Bowen Hill Apartments. Magetta Company Limited is only engaged in holding of the Property. After disposing the Property, Magetta Company Limited will become dormant. A circular containing further details of the Provisional sale and purchase agreement will be dispatched to the shareholders of the Company within 21 days after publication of this announcement.

At the request of the Company, trading of the Shares on the Stock Exchange was suspended with effect from 2:30 p.m. on 23 March 2004. The Company has applied for resumption of trading of the Shares on the Stock Exchange with effect from 9:30 a.m. on 29 March 2004.

DEFINITIONS OF TERMS USED IN THIS ANNOUNCEMENTS

“Board”	the board of directors of the Company
“Company”	Paladin Limited
“Director(s)”	director(s) of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	The Hong Kong Special Administrative Region of The PRC
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange

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“Property” Flat A on 21st Floor, The Harbour View, No.11 Magazine Gap Road, Hong Kong with carpark No.1 and Ancillary Space No.1A on 1st Floor “Provisional sale the provisional sale and purchase agreement dated 23 and purchase agreement” March 2004 made between Magetta Company Limited as vendor and Habour Time Group Limited as purchaser in relation to the Property

“PRC” the People’s Republic of China “Stock Exchange” The Stock Exchange of Hong Kong Limited

By order of the Board Paladin Limited Law Fong Director

Hong Kong, 26 March 2004

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

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