JD Logistics, Inc. — Share Issue/Capital Change 2001

Oct 30, 2001

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.

(Incorporated in the Cayman Islands with limited liability)

PROPOSED REORGANISATION INVOLVING

ADOPTION OF NEW ARTICLES,

INCREASE IN AUTHORISED SHARE CAPITAL

AND ADOPTION OF NEW SHARE OPTION SCHEME

AND

MAJOR AND CONNECTED TRANSACTIONS

REGARDING

ACQUISITION OF INTERESTS IN

PROPERTIES IN THE PRC AND

ISSUE OF PREFERENCE SHARES

The Directors propose to effect a reorganisation involving:

1) the adoption of the New Articles;

2) an increase in the authorised share capital from HK$100,000,000 to HK$120,000,000 by the creation of 2,000,000,000 Preference Shares; and

3) the adoption of the New Scheme.

The reorganisation is conditional, among other things, on the approval of the Shareholders in general meeting of the Company.

The Directors also announce that on 29th October, 2001, the Company entered into the Agreement to acquire from the Vendor the entire issued share capital of, and the Shareholders Loan to, the Property Company for an aggregate consideration of HK$252,900,000 in cash. The Property Company will, prior to completion of the Agreement, hold the interest in the Chengdu Property, the Lambda and Yuen Sang Properties and the Chuang’s Garden Property. Pursuant to the Subscription Agreement, the proceeds of HK$252,900,000 under the Agreement will be utilised for the subscription by CCW of 421,500,000 Preference Shares at an issue price of HK$0.60 each. 84,000,000 Preference Shares are each convertible into two Shares (subject to adjustment), which on full conversion, would result in the issue of an aggregate of 168,000,000 Conversion Shares.

Completion of the Agreement is conditional on, among other things, the approval of the Independent Shareholders in general meeting of the Company. Completion of the Subscription Agreement is conditional on, among other things, the listing of, and permission to deal in, the Conversion Shares being granted by the Listing Committee of the Stock Exchange and the approval of the Independent Shareholders in general meeting of the Company.

The Agreement and the Subscription Agreement constitute major and connected transactions for the Company under the Listing Rules. Upon completion of the Agreement, the Rental Agreement for certain units in the Lambda and Yuen Sang Properties will constitute continuing connected transactions for the Company under the Listing Rules.

‍REORGANISATION

The Directors propose (1) the adoption of the New Articles; (2) an increase in the authorised share capital from HK$100,000,000 to HK$120,000,000 by the creation of 2,000,000,000 Preference Shares; and (3) the adoption of the New Scheme.

‍Adoption of the New Articles

The Directors propose to adopt the New Articles in replacement of the existing Memorandum and Articles of Association of the Company. The changes in the New Articles principally involve the inclusion of the terms of the new Preference Shares. The adoption of the New Articles is conditional on the approval of the Shareholders in general meeting of the Company.

‍Increase in authorised share capital

To allow flexibility for the Company to consider issuing share capital other than Shares, the Directors will put forward a proposal at the extraordinary general meeting of the Company to increase the authorised share capital of the Company from HK$100,000,000 to HK$120,000,000 by the creation of 2,000,000,000 Preference Shares. The increase in authorised share capital is conditional on the approval of the Shareholders in general meeting of the Company. As at the date of this announcement, the Company has in issue 365,290,068 Shares.

‍Adoption of the New Scheme

The Directors have noted the recent changes to the Listing Rules with respect to the requirements governing the Company’s existing employee share option scheme. In compliance with such changes to the Listing Rules, the Directors propose to adopt the New Scheme. The purpose of the New Scheme is to provide incentives to participants thereunder to contribute to the Group and to enable the Group to recruit high calibre employees.

The adoption of the New Scheme is conditional upon, inter alia, (1) the approval of the Shareholders in general meeting of the Company; and (2) the Listing Committee of the Stock Exchange granting approval for the New Scheme, the granting of options thereunder and the listing of, and permission to deal in, the Shares to be issued pursuant to the exercise of the options granted under the New Scheme.

‍THE SALE AND PURCHASE AGREEMENT DATED 29TH OCTOBER, 2001

‍Parties to the Agreement

Purchaser:	the Company
Vendor:	Chuang’s China Commercial Limited, a wholly-owned subsidiary of CCW
Guarantor:	CCW, as the guarantor for the Vendor

‍The Properties

Pursuant to the Agreement, the Company will acquire the entire issued share capital of the Property Company and the Shareholders Loan, The principal assets of the Property Company prior to completion of the Agreement will be the indirect 51% interest in the Chengdu JV Company and wholly-owned subsidiaries of CCW holding the Lambda and Yuen Sang Properties, and the Chuang’s Garden Property. The Properties comprise the Chengdu Property, the Lambda and Yuen Sang Properties and the Chuang’s Garden Property.

The Chengdu Property

Pursuant to the Agreement, the Group will acquire an indirect 51% equity interest in Chengdu JV Company. Upon completion of the Agreement, Chengdu JV Company holds (i) the entire commercial podium and basement of the Chengdu Chuang’s Centre; and (ii) two residential units (with a car park space) in Chengdu. Chengdu Chuang’s Centre is located at No.1, Renmin South Road, Wuhou District in the city center of Chengdu, Sichuan, the PRC. The 6-storey commercial podium and three levels of basement of Chengdu Chuang’s Centre has a total gross floor area of 42,730 sq.m. The superstructure of the Chengdu Chuang’s Centre has been completed and it is currently undergoing internal decoration works. The Chengdu Chuang’s Centre is expected to be completed in mid-2002. Pursuant to the Agreement, the Vendor has agreed and undertaken to pay its relevant portion of all construction costs up to completion of the construction works of the commercial podium and the basement of the Chengdu Chuang’s Centre.

Five floors of the commercial podium with a gross floor area of approximately 20,000 sq.m. have been pre-leased to an independent third party for a term of 10 years, with an annual rental of RMB10 million (or approximately HK$9.3 million) in the first year and escalating rent thereafter. Total rental income for the ten-year period for this portion of the property will amount to approximately RMB140 million (or approximately HK$132 million). The 51% interest in the Chengdu Chuang’s Centre has been valued by the Valuer as at 30th September, 2001 at HK$121,890,000, on the basis that the Chengdu Chuang’s Centre has been completed as at the date of valuation.

The two residential units (with a car park space) are located in Youyi Road, Wuhou District, Chengdu, Sichuan, the PRC. The residential units are currently self-occupied by Chengdu JV Company as staff quarters. The 51% interest in the residential units (with a car park space) has been valued by the Valuer as at 30th September, 2001 at HK$632,400.

The Lambda and Yuen Sang Properties

The Lambda and Yuen Sang Properties comprise the entire Lambda Building, Yuen Sang Building (which are non-residential buildings) and three 8-storey residential blocks located at Chuang’s New Town, Danshui, Huiyang, the PRC. The Lambda and Yuen Sang Properties have a total gross floor area of 35,177 sq.m., of which 24,059 sq.m. are leased for an annual rental of approximately HK$2.7 million.

The majority of the Lambda Building, part of Yuen Sang Building (approximately 7%) and part of the residential blocks (approximately 26%) are leased to an independent third party at an annual rental of HK$1,624,780. Part of the Yuen Sang Building and part of the residential blocks are currently leased to a subsidiary of CCW at an annual rental of approximately HK$1,067,180. The Lambda and Yuen Sang Properties have been valued by the Valuer as at 30th September, 2001 at HK$46,700,000. The valuation of the Lambda and Yuen Sang Properties represents their respective open market value and valued by way of the investment method by capitalising the net rental income derived from the existing tenancies with due allowance for the reversionary potential of the properties.

The Chuang’s Garden Property

The Chuang’s Garden Property consists of 372 residential units in Chuang’s New Town, Danshui, Huiyang, the PRC. The Chuang’s Garden Property is currently vacant and has a total gross floor area of 28,547 sq.m. With increased economic activities in the area, the Directors consider that the demand for the residential units in the Chuang’s Garden Property will increase.

Pursuant to the Agreement, the Vendor has given an undertaking in favour of the Company that in the event the annual rental income of the Chuang’s Garden Property for each of the 2 years after the date of completion of the Agreement shall be less than HK$3.88 million, the Vendor will indemnify the Company for the amount of the shortfall on a dollar for dollar basis. The Chuang’s Garden Property has been valued by the Valuer as at 30th September, 2001 at HK$97,000,000.

‍Financial information relating to the Properties

The Property Company was incorporated in the British Virgin Islands on 7th January, 2000 and its sole business activity, upon completion of the Agreement, will be the holding of the Properties. Taking into account the Valuation as at 30th September, 2001, the Property Company has aggregate pro-forma combined net assets and Shareholders Loan of HK$266.6 million. The proportion of the Shareholders Loan (aggregating HK$119.8 million ) attributable to the Chengdu Property, the Lambda and Yuen Sang Properties and the Chuang’s Garden Property amounted to approximately HK$41.8 million, HK$30 million and HK$48 million, respectively. The Property Company has no bank borrowings or other net liabilities.

For the 12 months ended 31st March, 2001 and 2000, the Properties generated rental income of approximately HK$2.6 million and HK$3.1 million, respectively, which were wholly derived from the Lambda and Yuen Sang Properties.

‍The Consideration

The Consideration of HK$252,900,000 has been agreed between the parties with reference to, and represents an approximately 5% discount to, the aggregate amount of HK$266.6 million of the pro-forma combined net assets of the Property Company (taking into account the Valuation) of HK$146.8 million and the outstanding amount of the Shareholders Loan as at 30th September, 2001 of HK$119.8 million.

The Consideration will be satisfied in cash upon completion of the Agreement. Immediately thereafter, the entire proceeds will be applied by CCW towards the subscription of the 421,500,000 Preference Shares. Principal terms of the Preference Shares are summarised below.

‍Conditions of the Agreement

The Agreement is conditional upon, among other things,

˙ completion of an internal restructuring of the CCW Group such that the Property Company will become the indirect holding company of the Properties;

˙ the passing of a resolution by the Independent Shareholders in an extraordinary general meeting to approve the entering into and performance of the Agreement and the transactions contemplated thereunder;

˙ the Vendor having obtained a title report in form and content acceptable to the Company from qualified lawyers in the PRC certifying that each of the owners of the Properties has good title to the relevant Property;

˙ the simultaneous completion of the Subscription Agreement; and

˙ all necessary consents and approval being obtained from all relevant regulatory authority and financiers of each party to the Agreement.

Pursuant to the Agreement, CCW will guarantee the due performance of the obligations of the Vendor under the Agreement.

‍THE SUBSCRIPTION AGREEMENT DATED 29TH OCTOBER, 2001

‍Parties to the Subscription Agreement

Issuer:	the Company
Subscriber:	CCW

‍Summary of the terms of the Preference Shares

Number of Preference Shares:	421,500,000 (of which 84,000,000 bear conversion rights)
Aggregate face value:	HK$252,900,000
Issue Price:	HK$0.60 per Preference Share
Par value:	HK$0.01 per Preference Share
Dividend:	subject to the Companies Law, 2.5% p.a. on the aggregate issue price of the outstanding Preference Shares payable half-yearly and cumulatively in arrears.
Voting:	subject to the Companies Law and except in class meeting of holders of the Preference Shares, holder(s) of the Preference Shares will have no voting rights at any meetings of the holders of the Shares.
Transferability:	transferable in whole or in part of not less than 10,000,000 Preference Shares.
Conversion:	subject to the terms of the Preference Shares, 84,000,000 Preference Shares (approximately 20% of the Preference Shares) are convertible into Shares at any time during a period of 5 years after completion of the Subscription Agreement at the conversion ratio. The Conversion Shares shall, when issued, rank pari passu in all respects with all other Shares in issue on the date of conversion including the right to any dividends or distributions.
Conversion ratio:	one Preference Share is convertible into two Shares (subject to adjustment in accordance with the terms of the Preference Shares), equivalent to a conversion price of HK$0.30 per Share.
Redemption:	subject to the Companies Law, unless previously converted, the Preference Shares are redeemable by the Company at any time up to a date immediately prior to the fifth anniversary after completion of the Subscription Agreement in multiples of HK$2,500,000 at their outstanding subscription amount, together with any unpaid dividend in cash. The Company shall redeem all outstanding Preference Shares not converted on the fifth anniversary after completion of the Subscription Agreement at their outstanding subscription amount together with any unpaid dividend in cash.

The Company will undertake to notify the Stock Exchange as soon as practicable upon the board of Directors becoming aware of any dealing in the Preference Shares by connected parties of the Company, its subsidiaries and any of its associates (as defined in the Listing Rules).

‍Conversion ratio for Preference Shares

The conversion ratio of two Shares for every Preference Share (subject to adjustment) has been agreed after arms’ length negotiations between the parties with reference to the issue price of the Preference Shares. The conversion ratio is equivalent to a conversion price of HK$0.30 per Share which represents a premium of approximately 51.5% to the closing price of the Shares as quoted on the Stock Exchange on 29th October, 2001 of HK$0.198 per Share and a premium of approximately 50% to the average of the closing prices of the Shares for the ten consecutive trading days ended on 29th October, 2001 of HK$0.20 per Share.

‍Shareholdings in the Company

The following is a summary of the shareholdings in the Company before and after the completion of the Agreement and the Subscription Agreement and the effect of full conversion of the 84,000,000 Preference Shares:

	Existing	%	Upon completion of the Agreement and the Subscription Agreement but prior to conversion of the Preference Shares	%	Upon completion of the Agreement and the Subscription Agreement and conversion of 84,000,000 Preference Shares	%
					(Note a)
Shares
CCW (Note b)	60,000,000	16.43	60,000,000	16.43	228,000,000	42.75
Moscow Profits Limited (Note c)	20,000,000	5.48	20,000,000	5.48	20,000,000	3.75
Director (Note d)	10,000	0.00	10,000	0.00	10,000	0.00
Public	285,280,068	78.09	285,280,068	78.09	285,280,068	53.50
Total	365,290,068	100.0	365,290,068	100.0	533,290,068	100.0
Preference Shares	0		421,500,000		337,500,000

Notes:

a) Assuming CCW converts in full 84,000,000 Preference Shares into the Conversion Shares.

b) The existing shareholding of CCW in the Company is held through its wholly-owned subsidiary, Gold Throne Finance Limited.

c) This company is beneficially owned by Mr. Chuang as to 66% and Mrs. Siu as to 34%.

d) Mr. Shek Lai Him, Abraham, a non-executive Director, holds 10,000 Shares.

If 84,000,000 Preference Shares are converted in full, it is possible (depending inter alia on the shareholdings in and issued share capital structure of the Company at that time) that a change of control will occur and a general offer for the Shares would be triggered under Rule 26 of the Takeovers Code. In such event, CCW will comply with the relevant provisions of the Takeovers Code. However, CCW has indicated that it intends to maintain a shareholding in the Company which, when aggregated with Shares held by persons acting in concert with CCW, will amount to less than 30% (or such other percentage as stipulated under the Takeovers Code from time to time) and has no intention to convert the 84,000,000 Preference Shares to such extent that it would result in CCW incurring an obligation to make a general offer for the Shares.

‍Conditions of the Subscription Agreement

The Subscription Agreement is conditional upon, among other things,

˙ the passing of a resolution by the Independent Shareholders in an extraordinary general meeting to approve the entering into and performance of the Subscription Agreement and the transactions contemplated thereunder;

˙ no indication having been received by the Company from the Stock Exchange or the Securities and Futures Commission to the effect that the current listing of the Shares on the Stock Exchange will or may be withdrawn or suspended either before or at any time following completion of the Subscription Agreement (save for temporary suspension pending any announcements in connection with the Subscription Agreement and any other suspension at the request of the Company and with the consent of CCW);

˙ the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the Conversion Shares;

˙ approval by the Shareholders of the increase in the authorised share capital of the Company and the adoption of the New Articles; and

˙ the simultaneous completion of the Agreement.

The Preference Shares will not be listed on the Stock Exchange. Application will be made to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in the Conversion Shares.

If the conditions under the Agreement and the Subscription Agreement are not satisfied on or before 31st January, 2002, the Agreement and the Subscription Agreement will lapse without any liability on the part of the Vendor, CCW and the Company. Completion of the Agreement and the Subscription Agreement will take place on the third business day after fulfillment of all the conditions relating thereto.

‍REASONS FOR THE TRANSACTIONS

The Group is principally engaged in commercial printing, books printing and packaging printing. In recent years, the Group has faced increasingly fierce competition in printing operations and as a result, the profitability of the Group has deteriorated. For the six months ended 30th June, 2001, the Group recorded an unaudited consolidated profit attributable to Shareholders of HK$10.1 million, as compared to the unaudited consolidated profit attributable to Shareholders of HK$16.5 million for the six months ended 30th June, 2000. In view of the increasingly competitive environment, the Directors stated in the 2001 interim results announcement of the Company that they will look for ways for the Group to diversify its activities into other areas of operation and to broaden its sources of income as suitable opportunities arise.

The Directors consider that the acquisition of the Properties is beneficial to the Company and the terms of the Agreement and the Subscription Agreement are fair and reasonable insofar as the Independent Shareholders are concerned for the following reasons:

˙ against the background of a weakening in the Group’s traditional printing business, whose export oriented customers are adversely affected by the current economic conditions, the Agreement represents an opportunity for the Company to acquire tangible assets in the PRC, whose economy is still growing at around 7% per annum. The Properties being acquired are generating recurrent rental income and have good potential for capital appreciation;

˙ the Consideration will be satisfied in a favourable manner to the Company by the issue of low dividend Preference Shares. On the basis of existing rental income receivable and rental guarantees provided by the Vendor, the Property Company will generate annual rental income of approximately HK$11.3 million. Compared to the annual dividend payable on the Preference Shares of approximately HK$6.3 million, the acquisition of the Property Company will provide an annual positive net cashflow of approximately HK$5.0 million for the Group. Remaining vacant units in the Properties, once rented out, will generate additional rental income;

˙ the acquisition of the Property Company will allow the Group to enlarge its gross and net asset base by 49.2% and 92.6% respectively, which will provide a stronger foundation for developing the Group’s business activities and its future expansion. On the basis of the unaudited pro-forma combined net assets of the Property Company together with the Shareholders Loan of HK$266.6 million as at 30th September, 2001, the acquisition of the Property Company will increase the Group’s net assets by approximately HK$266.6 million; and

˙ on the basis of the conversion ratio of two Shares for one Preference Share, a portion of the Preference Shares is convertible at an equivalent price of approximately 50% higher than the current market price of the Shares.

The Consideration has been structured such that 84,000,000 Preference Shares (approximately 20% of the Preference Shares) bear conversion rights. The Directors consider that the limiting of the amount of the Preference Shares convertible into Shares will reduce the dilution effect of the transaction to existing Shareholders, while restricting the maximum amount of cash outlay by the Company for redeeming the Preference Shares if the 84,000,000 Preference Shares are converted. The Preference Shares do not in normal circumstances carry any voting rights in general meetings of Shareholders and therefore the Shareholders will not be diluted in terms of voting rights.

‍IMPLICATIONS UNDER THE LISTING RULES

The Agreement and the Subscription Agreement constitute major transactions for the Company and, by reason of the interest of CCW in the Company, the Agreement and the Subscription Agreement also constitute a connected transaction for the Company under the Listing Rules. Accordingly, the Agreement and the Subscription Agreement require the approval of the Independent Shareholders in general meeting of the Company. CCW and Moscow Profits Limited (being a company held by Mr. Chuang and Mrs. Siu) will abstain from voting in respect of the ordinary resolutions to approve the Agreement and the Subscription Agreement. An independent committee of the board of Directors (“Independent Board Committee”) has been established to advise the Independent Shareholders in this regard. Tai Fook Capital Limited has been appointed as the independent financial adviser to advise the Independent Board Committee in respect of the terms of the Agreement and the Subscription Agreement.

‍CONNECTED TRANSACTION

‍Rental Agreement for the Lambda and Yuen Sang Properties

At present, a portion of the Yuen Sang Building and a portion of the residential blocks with a total gross floor area of approximately 8,185 sq.m. are leased to a wholly-owned subsidiary of CCW at an aggregate annual rental of HK$1,067,180 based on the market rate of similar properties. The Rental Agreement is for a duration of 2 years with an option to renew for an additional term of 2 years. Prior to completion of the Agreement, an assignment of all Rentals will be signed by the Landlord in favour of a wholly-owned subsidiary of the Property Company. The aggregate amount of the rental income under the Rental Agreement from 1st November, 2001 up to 31st March, 2003, being the date of its expiry, would amount to HK$1,511,839.

Upon completion of the Agreement, as the Tenant is a subsidiary of CCW, the Tenant will be a connected person of the Company under the Listing Rules for the purpose of the Rental Agreement. Accordingly, the transactions contemplated thereunder constitute connected transactions for the Company pursuant to Rule 14.25(1) of the Listing Rules and require disclosure by way of a press announcement. The Directors (including the independent non-executive Directors) consider the terms of the Rental Agreement are fair and reasonable as far as the Independent Shareholders are concerned and that the Rental Agreement is in the interest of the Company. Information on the Rental Agreement will also be disclosed in the annual report of the Company following completion of the Agreement.

‍GENERAL

A circular will be issued as soon as practicable to the Shareholders. The circular will contain, among other things, a summary of the provisions of the New Articles, a summary of the major terms of the New Scheme, further details of the Agreement and the Subscription Agreement, the Valuer’s report on the Properties, the recommendation of the Independent Board Committee, the letter of advice from Tai Fook Capital Limited and a notice of an extraordinary general meeting of the Company convened for the purpose of considering, among others, the adoption of the New Articles and the New Scheme, the increase in authorised share capital of the Company, the Agreement, the Subscription Agreement and the issue of the Preference Shares.

‍DEFINITIONS

“Agreement”	the agreement dated 29th October, 2001 entered into between the Vendor, the Company as the purchaser and CCW as the Vendor’s guarantor in relation to the sale and purchase of the entire issued share capital of, and Shareholders Loan to, the Property Company
“associate(s)”	has the meaning given to it in the Listing Rules
“CCW”	China CyberWorld Limited, a company incorporated in Bermuda with limited liability whose securities are listed on the Stock Exchange
“CCW Group”	CCW and its subsidiaries
“Chengdu JV Company”	Chengdu Chuang’s Centre Development Co. Limited, a company established in the PRC, which will, prior to completion of the Agreement, be an indirect 51% owned subsidiary of the Property Company
“Chengdu Property”	properties comprise (a) the entire commercial podium and basement of the Chengdu Chuang’s Centre; and (b) 2 residential units with a car park space, all located in Wuhou District in Chengdu, Sichuan, the PRC
“Chuang’s Garden Property”	372 residential units in Chuang’s Garden in Chuang’s New Town, Danshui, Huiyang, the PRC
“Companies Law”	The Companies Law (2001 Second Revision) of the Cayman Islands
“Company”	Midas Printing Group Limited, a company incorporated in the Cayman Islands with limited liability whose securities are listed on the Stock Exchange
“Consideration”	HK$252,900,000, being the aggregate consideration for the sale and purchase of the entire issued share capital of and the assignment of the Shareholders Loan to the Property Company pursuant to the Agreement
“Conversion Shares”	168,000,000 new Shares to be issued on exercise of the conversion rights attaching to the 84,000,000 Preference Shares
“Directors”	directors of the Company, including the independent non-executive directors of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	Hong Kong Special Administrative Region of the PRC
“Independent Shareholders”	Shareholders, other than CCW and its associates
“Lambda and Yuen Sang Properties”	the entire Lambda Building, Yuen Sang Building, which are non-residential buildings and three 8-storey residential blocks located in Chuang’s New Town, Danshui, Huiyang, the PRC
“Landlord”	Chuang’s Development (China) Limited, a wholly-owned subsidiary of CCW
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange
“Mr. Chuang”	Mr. Alan Chuang Shaw Swee, a substantial shareholder of Chuang’s Consortium International Limited, the controlling shareholder of CCW
“Mrs. Siu”	Mrs. Alice Siu Chuang Siu Suen, the sister of Mr. Chuang
“New Articles”	the amended and restated Memorandum and Articles of Association of the Company proposed to be adopted in replacement of the existing Memorandum and Articles of Association
“New Scheme”	the new employee share option scheme proposed to be adopted by the Company in replacement of the existing employee share option scheme
“PRC”	the People’s Republic of China
“Preference Shares”	421,500,000 non-voting redeemable preference shares at par value of HK$0.01 each in the capital of the Company to be issued to CCW or its nominee at HK$0.60 each upon the completion of Subscription Agreement. 84,000,000 Preference Shares are each convertible into two Conversion Shares
“Properties”	the Chengdu Property, the Lambda and Yuen Sang Properties and the Chuang’s Garden Property
“Property Company”	AsianWisdom.Com Limited, a company incorporated in the British Virgin Islands, which will, prior to completion of the Agreement, be the beneficial owner of the Properties, and an indirect wholly-owned subsidiary of CCW
“Rental Agreement”	the rental agreement dated 31st March, 2001 entered into between the Landlord and the Tenant in relation to the leasing of units within the Lambda and Yuen Sang Properties
“Rentals”	the rentals payable to the Landlord by the Tenant pursuant to the Rental Agreement
“Share(s)”	ordinary shares of HK$0.10 each in the capital of the Company
“Shareholders”	holders of Shares
“Shareholders Loan”	a shareholders loan owing by the Property Company to the Vendor in the amount of approximately HK$119.8 million
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Subscription Agreement”	the subscription agreement dated 29th October, 2001 entered into between CCW as the subscriber and the Company as the issuer in relation to the issue of the Preference Shares
“Takeovers Code”	The Hong Kong Code on Takeovers and Mergers
“Tenant”	Yuen Sang Hardware Co. (1988) Limited, a wholly-owned subsidiary of CCW
“Valuer”	Debenham Tie Leung Limited, a firm of independent professional valuers
“Valuation”	the independent professional valuation of the Properties as at 30th September, 2001 prepared by the Valuer in the aggregate attributable amount of approximately HK$266.2 million
“Vendor”	Chuang’s China Commercial Limited, a wholly-owned subsidiary of CCW
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong

By Order of the Board
Midas Printing Group Limited
Kwong Tin LapManaging DirectorHong Kong, 29th October, 2001

For identification purpose only

Please also refer to the published version of this announcement in the Hong Kong iMail.