KPa-BM Holdings Limited — Proxy Solicitation & Information Statement 2006

Jul 14, 2006

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 stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in China Resources Logic Limited , you should at once hand this circular to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or the transfer was effected for transmission to the purchaser or transferee.

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

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(Incorporated in Bermuda with limited liability) (Stock Code: 1193)

DISCLOSEABLE TRANSACTION

AND

ESTABLISHMENT OF A JOINT VENTURE

14th July, 2006

CONTENTS

		Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
Letter from the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
2.	Asset Sale and Purchase Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
3.	Establishment of a Joint Venture Company . . . . . . . . . . . . . . . . . . . . . . . .	6
4.	General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Appendix	– General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11

– i –

DEFINITIONS

For the purpose of this circular, the following expressions have the following meanings:

“Acquisition”

the transaction contemplated under the Asset Sale and Purchase Agreement

“ANST”	Wuxi CR Micro-Assemb Tech. Ltd., a company
	incorporated in the PRC and is an indirectly wholly
	owned subsidiary of the Company before Completion of
	the Subscription Agreement
“Asset Sale and Purchase	the asset sale and purchase agreement entered into
Agreement”	between ANST, CRL, SCC and SCL on 22nd June, 2006,
	which is more particularly described under section 2
	“Asset Sale and Purchase Agreement” in the “Letter from
	the Board” of this circular
“Assets”	the tools, equipment and spare parts more particularly
	described in the Asset Sale and Purchase Agreement
“Board”	the board of directors of the Company
“Company” or “CRL”	China Resources Logic Limited, an exempted company
	incorporated in Bermuda with limited liability, the shares
	of which are listed on the main board of the Stock
	Exchange
“Directors”	directors of the Company
“Fabless”	semiconductor manufacturer who operates without a
	fabrication plant
“Group”	the Company and its subsidiaries
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the
	PRC
“Hong Kong GAAP”	Generally Accepted Accounting Principles in Hong Kong
“IC”	Integrated Circuit. A tiny group of electronic components
	and their connections produced on a slice of material
	such as silicon

– 1 –

DEFINITIONS

• “IDM” “Joint Venture Agreement”

integrated device manufacturer, vertically integrated semiconductor companies that engage in the process from product conception to design to manufacture

the joint venture agreement entered into between CRL, Wuxi CRM, MAT, ANST and SCL on 22nd June, 2006, which is more particularly described under section 3 “Establishment of a Joint Venture Company” in the “Letter from the Board” of this circular

• “Latest Practicable Date” 11th July, 2006 being the latest practicable date before the printing of this circular for ascertaining certain information contained herein

• “Listing Rules” The Rules Governing the Listing of Securities on the Stock Exchange

• “Manufacturer’s Representative the manufacturer’s representative agreement entered into Agreement” between ANST, CRL, SCBL and SCL on 22nd June, 2006, in which SCBL, an independent third party, shall solicit orders from existing and future customers of the SCL Group (the “Transfer Customers”) to be placed directly with ANST and assist ANST in relation to promotional activities and events. In return, ANST shall pay certain fees to SCBL. Details of the manufacturer’s representative agreement are contained in the Company’s announcement dated 22nd June, 2006

• “MAT” or “JV Company” Micro Assembly Technologies Limited, a company incorporated in the British Virgin Islands and is (i) an indirectly wholly owned subsidiary of the Company before Completion of the Subscription Agreement and (ii) wholly owns ANST both before and after Completion of the Subscription Agreement

• “percentage ratios” the percentage ratios referred to in Rule 14.07 of the Listing Rules

• “PRC” The People’s Republic of China

• “RMB” Reminbi, the lawful currency of the PRC

– 2 –

DEFINITIONS

“SCBL”	STATS ChipPAC (BVI) Limited, a company incorporated
	in the British Virgin Islands and is an indirectly wholly
	owned subsidiary of SCL
“SCC”	STATS ChipPAC Shanghai, Co., Ltd., a company
	incorporated in the PRC and is an indirectly wholly
	owned subsidiary of SCL. SCC is not connected with the
	Group and its connected person and is not a connected
	person of the Company as defined under the Listing
	Rules
“SCL”	STATS ChipPAC Ltd., a company incorporated under the
	laws of Singapore, and is not connected with the Group
	and its connected person and is not a connected person of
	the Company as defined under the Listing Rules
“SCL Group”	SCL together with its subsidiaries
“SFO”	Securities and Futures Ordinance, Chapter 571 of the
	laws of Hong Kong
“Shareholder(s)”	shareholder(s) of the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Subscription Agreement”	the subscription agreement, entered into between CRL,
	Wuxi CRM, MAT and SCL, on 22nd June, 2006, which is
	more particularly described under section 3
	“Establishment of a Joint Venture Company” in the
	“Letter from the Board” of this circular
“US$”	United States dollars, the lawful currency of the United
	States of America
“Wuxi CRM”	Wuxi China Resources Microelectronics (Holdings)
	Limited, a company incorporated in the British Virgin
	Islands and is (i) an indirectly wholly owned subsidiary
	of the Company and (ii) wholly owns MAT before
	Completion of the Subscription Agreement
“%”	per cent

– 3 –

LETTER FROM THE BOARD

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(Incorporated in Bermuda with limited liability) (Stock Code: 1193)

Directors: Executive Directors: ZHU Jinkun (Chairman) WANG Guoping (Chief Executive Officer) ONG Thiam Kin YU Yu

Independent Non-executive Directors: WONG Tak Shing LUK Chi Cheong KO Ping Keung

Registered office: Canon’s Court 22 Victoria Street Hamilton HM 12 Bermuda

Head office and principal place of business: Rooms 4003-06 China Resources Building 26 Harbour Road Wanchai Hong Kong

14th July, 2006

To Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION

AND

ESTABLISHMENT OF A JOINT VENTURE

1. INTRODUCTION

The Company has, by an announcement dated 22nd June, 2006 (the “Announcement”), announced that the Company and its then indirectly wholly owned subsidiary, ANST, have entered into an Asset Sale and Purchase Agreement with SCC and SCL. Further, the Announcement has also disclosed that the Company and its indirectly wholly owned subsidiary, Wuxi CRM, have entered into a Joint Venture Arrangement with SCL.

For the purpose of the Listing Rules, the Acquisition pursuant to the Asset Sale and Purchase Agreement and the establishment of the Joint Venture Arrangement together amount to a discloseable transaction.

The purpose of this circular is to provide you with further information relating to the Acquisition and the Joint Venture Arrangement.

– 4 –

LETTER FROM THE BOARD

2. ASSET SALE AND PURCHASE AGREEMENT

(a) Date: 22nd June, 2006

• (b) Parties: (i) ANST as purchaser;

• (ii) CRL as guarantor for payment obligation of ANST;

• (iii) SCC, an independent third party, as seller; and

• (iv) SCL as guarantor for the performance and obligations of SCC.

(c) Transaction Nature

SCC, an independent third party, as seller agrees to sell to ANST and ANST as purchaser agrees to purchase the Assets described under the Asset Sale and Purchase Agreement. The Assets will be used by ANST in relation to expanding its capacity and volume of IC assembly and testing foundry business to serve the growing requirements from its current customers and from overseas customers to be referred to ANST by SCBL pursuant to Manufacturer’s Representative Agreement, which will be effective on 1st January, 2007.

(d) Consideration

ANST and SCC are in the same IC assembly and testing foundry business. Before ANST decided to purchase the Assets, which consists of fully operating equipment and machinery providing a broad spectrum of testing and packaging services, its professional staff had inspected and examined the Assets. The Assets are found to be (i) in good working conditions and (ii) entirely suitable for ANST’s business development. The consideration of the Assets is arrived at after due consideration and judgement by the Board which is based upon (i) ANST’s judgement basing on its experience, professional knowledge and familiarity with assets required for the conduct of its IC assembly and testing foundry business, (ii) the rarity of finding such a complete range of operating IC assembly and testing equipment available for sale and (iii) arm’s length basis negotiation and normal commercial terms.

Out of the total consideration of US$35,000,000, an initial amount of US$12,000,000 has been paid by ANST to SCC upon signing of the Asset Sale and Purchase Agreement. This initial amount of US$12,000,000 is wholly financed by borrowed funds. The balance of US$23,000,000 is payable by 4 instalments on a yearly basis on the last business day of each year from year 2007 to 2010. The payment will be satisfied partly by internal resources and partly by the revenue derived from the Transfer Customers under the Manufacturer’s Representative Agreement. The proportion of payment by internal resources and revenue derived from the Transfer Customers has not yet been determined. In any event, the full amount of US$23,000,000 will be made on or before 31st December, 2010. The Assets will be transferred in phases in accordance with the underlying business requirement of ANST and is expected to complete by end of May, 2007.

– 5 –

LETTER FROM THE BOARD

CRL will guarantee the payment of consideration obligation of ANST; whilst SCL will guarantee the due and punctural performance of SCC under the Asset Sale and Purchase Agreement.

(e) Information on the Assets

More than 1,000 sets of key assembly and testing equipment (for example, backgrind, wafer saw, die attach, wire bond, mold die, laser mark, test, handler) have been purchased by ANST from SCC. Before such sale, the Assets are used by SCC for its IC assembly and testing foundry business in Shanghai and are still in reasonably good working conditions. Upon the sale of the Assets, SCC will no longer carry on the business (business that utilizes the Assets) to be transferred to and performed by ANST. SCC will focus on more advanced leading edge areas of IC assembly and testing foundry business in which ANST will not be involved for the foreseeable future.

(f) Benefits of the Acquisition

Before they are sold, the Assets are employed by SCC for testing and packaging foundry in its service to international customers. ANST is capable of operating efficiently and effectively these Assets. The purchase of the Assets, together with the referral of Transfer Customers by SCBL to ANST pursuant to the Manufacturer’s Representative Agreement will enable ANST to benefit from having the ability to meet the booming Chinese IC market requirement as well as demand from the Transfer Customers and overseas customers. Further, these measures will allow ANST to increase significantly its production capacity and business scale, and expand its range of products and service coverage, especially test services which are hitherto not carried out by ANST. The Directors, including the independent non-executive Directors, consider the terms of the transaction including the consideration are, on normal commercial terms, are fair and reasonable and in the interests of the Shareholders as a whole.

3. ESTABLISHMENT OF A JOINT VENURE COMPANY

(a) Background

Set out below was the company structure of the Group which are engaged in the IC assembly and testing foundry business before the Joint Venture Arrangement.

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LETTER FROM THE BOARD

(b) The Joint Venture

On 22nd June, 2006, CRL, Wuxi CRM, MAT, ANST and SCL (a third party independent of any members of the Group) entered into a joint venture arrangement (the “Joint Venture Arrangement”) to engage in the business of IC assembly and testing foundry provider (the “Business”). The Joint Venture Arrangement is evidenced by the above parties entering into a Subscription Agreement and a Joint Venture Agreement, details of which are set out below.

(i) Subscription Agreement

(a) Date: 22nd June, 2006

(b) Parties: (i) CRL; (ii) Wuxi CRM; (iii) MAT; and (iv) SCL.

(c) Major terms

MAT, an existing indirectly wholly owned subsidiary of the Company before the Joint Venture Arrangement, is the investment vehicle for the joint venture (the “JV Company”). Originally, the number of authorized shares of MAT was 50,000 shares at a par value of US$1.00 each; and Wuxi CRM held 1 share of MAT. The number of authorized shares of MAT has been increased from 50,000 shares to 4,000,000 shares. Wuxi CRM subscribed 2,999,999 shares (the “Wuxi New Shares”) by way of the total net asset value of ANST, as at 31st May, 2006 (which were unaudited and prepared in accordance with the Hong Kong GAAP and was US$18,207,471 and which SCL agrees to), together with cash (which was US$11,792,529) (the above two figures together make up a total of US$30,000,000) and SCL subscribed 1,000,000 shares (the “Subscription Shares”) by way of cash of US$10,000,000 with the result that Wuxi CRM and SCL respectively holds 75% and 25% of the enlarged issued share capital of the JV Company. After the above subscription, additional capital will be injected into ANST, the resulting ANST’s shareholder’s fund will be expanded to US$40,000,000. The Business of the JV Company will be carried out by ANST. The shareholders’ fund (net asset value) of MAT and ANST remain unchanged both before and after the Assets purchase by ANST because the initial amount of US$12,000,000 payable pursuant to the Assets purchase is wholly financed by borrowed funds. There would be no change to the net asset value of MAT and ANST when it comes to payment of the balance of the consideration of US$23,000,000 as the increase in total assets of MAT and ANST (i.e. by the amount US$23,000,000 as part of the value of the Assets) will be offset by ANST’s liability to pay the same amount. Apart from the US$30,000,000 committed, there are no further capital commitment by Wuxi CRM in the Joint Venture Arrangement.

– 7 –

LETTER FROM THE BOARD

The completion (“Completion”) of the subscription of the Subscription Shares in MAT by SCL and the Wuxi New Shares by Wuxi CRM has taken place simultaneously upon the date of signing of the Subscription Agreement and the Joint Venture Agreement (the “Completion Date”).

CRL entered into the Subscription Agreement to guarantee the performance of Wuxi CRM.

After Completion, the company structure becomes:

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(d) Information on ANST

ANST was founded in 2003, with an initial registered share capital of RMB100,000,000. As of 31st May, 2006, the total asset and net asset of ANST were approximately RMB489 million and RMB147 million respectively. After SCL becomes a shareholder of MAT, MAT’s wholly owned subsidiary, ANST will expand its business scope, to focus on the rapidly growing international and domestic semiconductor markets, to provide IC assembly and testing foundry services to Fabless and IDM enterprises in the PRC and global semiconductor industry. The Assets acquired by ANST will be used for the purpose of the business of JV Company. ANST is now taking appropriate steps to obtain approvals from relevant authorities in the PRC to increase its registered capital from RMB100,000,000 to the RMB equivalent of US$40,000,000.

The audited revenues of ANST for the year ended 31st December, 2004 and 2005, which were prepared in accordance with the Hong Kong GAAP, were RMB 215,356,869 (equivalent to about HK$206,957,951) and RMB240,645,963 (equivalent to about HK$231,260,770) respectively. The audited net profits of ANST both before and after taxation for the year ended 31st December, 2004 and 2005 were RMB 19,154,778 (equivalent to about HK$18,407,742) and RMB14,881,678 (equivalent to about HK$14,301,292) respectively.

– 8 –

LETTER FROM THE BOARD

(ii) Joint Venture Agreement

(a) Date: 22nd June, 2006

(b) Parties: (i) CRL; (ii) Wuxi CRM; (iii) MAT; (iv) ANST; and (v) SCL.

• (c) Duration

The Joint Venture Agreement is effective upon Completion Date. There is no specific period on its duration but is subject to the existence of ANST.

• (d) Other major terms

Major terms of the Joint Venture Agreement include, among others, the followings:

• (i) The board of MAT shall comprise of four directors, with one director to be appointed by SCL.

• (ii) Each of Wuxi CRM and SCL will exercise their respective rights as shareholders of MAT to ensure the Business and affairs of the JV Company and ANST shall be properly and efficiently managed and operated.

• (iii) Each of Wuxi CRM and SCL undertakes to the other that each will not, as long as each is the shareholder of MAT, compete with the Business of the JV Company.

CRL entered into the Joint Venture Agreement to guarantee the performance of Wuxi CRM.

(iii) Benefit of entering into the Joint Venture Agreements

The SCL Group is one of the leading IC assembly and testing foundry provider in the world providing full turnkey solutions for high value added range of IC packaging and testing services. Both SCL Group and ANST are currently providing IC assembly and testing foundry services to their respective customers in different market segments. With the Assets transfer from SCC to ANST and with SCL as a partner and participation in the JV Company, ANST will be able to significantly expand its production capacity, upgrade its operation and broaden its customer base. Further, because of the referral of the Transfer Customers pursuant to the Manufacturer’s Representative Agreement, these Transfer Customers will be served by ANST in a more cost competitive and cost effective manner. Neither any member of CRL Group nor those of SCL Group will engage in any business which will compete with ANST for the same customer base and for the same domain of the IC assembly and testing foundry business (including those which ordinarily utilize the Assets acquired by ANST).

– 9 –

LETTER FROM THE BOARD

(iv) Discloseable Transaction

As the relevant percentage ratios in respect of the Joint Venture Arrangement together with the Acquisition in aggregate exceed 5% but are less than 25%, the entering into the Joint Venture Arrangement and the Acquisition constitute a discloseable transaction of the Company under the Listing Rules and is subject to the announcement, reporting and circular requirements under Chapter 14 of the Listing Rules. MAT and ANST will continue to be a subsidiary of the Company after entering into of the Joint Venture Agreement.

(v) Financial effect on the Discloseable Transaction on the Group

With the Assets transfer from SCC to ANST and with SCL as a partner and participation in the JV Company, ANST will be able to significantly expand its production capacity, upgrade its operation and broaden its customer base. This would have a positive impact on the earnings base of the Group in the medium to long term future.

The sum expended by the Group in both the Assets Sale and Purchase Agreement and Joint Venture Arrangement (collectively the “Discloseable Transaction”) will be recorded in the Group’s account at exactly the same value as the consideration and capital commitment stated in section 2(d) and 3(b)(i)(c) in the “Letter from the Board” of this circular respectively. The Discloseable Transaction will not have any material effect on the asset and liability of the Group.

The US$10,000,000 contributed by SCL will provide a new funding to the Group which will be injected into ANST to serve its operating needs.

If the Joint Venture Arrangement is seen as a disposal of the enlarged issued share capital of MAT (since 25% of its enlarged issued share capital is subscribed by SCL), there is no gain or loss arising out of this disposal as SCL subscribed the shares of MAT at MAT’s consolidated net asset value. Both MAT and ANST remain as subsidiaries of the Group after the Acquisition and Joint Venture Arrangement.

4. GENERAL

The Group is engaged in the semiconductor and air-conditioner compressor business. The SCL Group including SCC is engaged in the IC assembly and testing foundry business.

Your attention is also drawn to the additional information set out in the Appendix of this circular.

Yours faithfully, On behalf of the Board

China Resources Logic Limited ZHU Jinkun Chairman

– 10 –

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

Save as disclosed below, as at the Latest Practicable Date, none of the Directors, chief executive of the Company and their associates had any interests or short positions in any shares, underlying shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were required to be 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 they are deemed or taken to have under such provisions of the SFO) or which were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies, to be notified to the Company and the Stock Exchange:

(a) Interests in issued ordinary shares and underlying shares of the Company

				Number of	Aggregate
		Long or short	Number of	share	percentage
Name of Director	Capacity	position	shares	options1	of interest2
Mr. Zhu Jinkun	Beneficial Owner	Long position	2,370,000	6,100,000	0.32%
	Interest of Spouse	Long position	160,000	–
Mr. Wang Guoping	Beneficial Owner	Long position	1,108,000	3,000,000	0.15%
Mr. Ong Thiam Kin	Beneficial Owner	Long position	1,100,000	4,500,000	0.21%
Mr. Yu Yu	Beneficial Owner	Long position	100,000	4,000,000	0.16%
	Interest of Spouse	Long position	60,000	–
Mr. Wong Tak Shing	Beneficial Owner	Long position	–	500,000	0.02%
Mr. Luk Chi Cheong	Beneficial Owner	Long position	–	900,000	0.03%
Mr. Ko Ping Keung	Beneficial Owner	Long position	–	900,000	0.03%

– 11 –

GENERAL INFORMATION

APPENDIX

Notes:

1. This refers to the number of underlying shares of the Company covered by the share options granted under the share options schemes of the Company, such options being unlisted physically settled equity derivatives, particulars of which as required to be disclosed under Rule 17.07(1) of the Listing Rules are set out in Note 3 below.

2. This represents the percentage of aggregate long position in ordinary shares and underlying shares to the total issued share capital of the Company as at the Latest Practicable Date.

3. Particulars of share options referred to in Note 1 above:

Name of Director Date of grant Exercise price per share (HK$)	Number of share options
	Outstanding as at 1st January, 2006 Exercised during the period Outstanding as at the Latest Practicable Date
Mr. Zhu Jinkun 25/04/20011 0.547 02/10/20025 0.570 09/04/20037 0.479 13/01/20048 0.906 Mr. Wang Guoping 09/04/20037 0.479 13/01/20049 0.906 Mr. Ong Thiam Kin 25/04/20011 0.547 02/10/20025 0.570 09/04/20037 0.479 13/01/20049 0.906 Mr. Yu Yu 04/12/20012 0.790 02/10/20025 0.570 09/04/20037 0.479 13/01/20049 0.906 Mr. Wong Tak Shing 22/05/20023 0.920 13/01/20048 0.906 Mr. Luk Chi Cheong 22/05/20023 0.920 02/10/20024 0.570 09/04/20036 0.479 13/01/20048 0.906 Mr. Ko Ping Keung 22/05/20023 0.920 09/04/20036 0.479 13/01/20048 0.906	1,000,000 – 1,000,000 800,000 – 800,000 2,800,000 – 2,800,000 1,500,000 – 1,500,000 2,000,000 – 2,000,000 1,000,000 – 1,000,000 2,000,000 – 2,000,000 1,000,000 – 1,000,000 500,000 – 500,000 1,000,000 – 1,000,000 1,500,000 – 1,500,000 1,000,000 – 1,000,000 500,000 – 500,000 1,000,000 – 1,000,000 300,000 – 300,000 200,000 – 200,000 300,000 – 300,000 200,000 – 200,000 200,000 – 200,000 200,000 – 200,000 500,000 – 500,000 200,000 – 200,000 200,000 – 200,000

Notes:

1. The exercisable period is divided into 2 tranches exercisable during the periods from 25th April, 2003 and 2004 to 24th April, 2011.

2. The exercisable period is divided into 3 tranches exercisable during the periods from 3rd December, 2002, 2003 and 2004 to 3rd December, 2011.

3. The exercisable period during which the options may be exercised is from 22nd May, 2002 to 21st May, 2012.

– 12 –

GENERAL INFORMATION

APPENDIX

1. The exercisable period during which the options may be exercised is from 2nd October, 2002 to 1st October, 2012.

2. The exercisable period is divided into 3 tranches exercisable during the periods from 2nd October, 2003, 2004 and 2005 to 1st October, 2012.

3. The exercisable period during which the options may be exercised is from 9th April, 2003 to 8th April, 2013.

4. The exercisable period is divided into 3 tranches exercisable during the periods from 9th April, 2004, 2005 and 2006 to 8th April, 2013.

5. The exercisable period during which the options may be exercised is from 13th January, 2004 to 12th January, 2014.

6. The exercisable period is divided into 3 tranches exercisable during the periods from 13th January, 2005, 2006 and 2007 to 12th January, 2014.

(b) Interests in issued ordinary shares and underlying shares of China Resources Enterprise, Limited (“CRE”), an associated corporation of the Company

				Number of	Aggregate
Name of		Long or short	Number of	share	percentage
Director	Capacity	position	shares	options1	of interest2
Mr. Zhu Jinkun	Interest of spouse	Long position	–	42,000	0.002%

Notes:

1. This refers to the number of underlying shares of CRE covered by the share options granted under the share options schemes of CRE, such options being unlisted physically settled equity derivatives, particulars of which as required to be disclosed under Rule 17.07(1) of the Listing Rules are set out in Note 3 below.

2. This represents the percentage of aggregate long position in ordinary shares and underlying shares to the total issued share capital of CRE as at the Latest Practicable Date.

3. Particulars of share options referred to in Note 1 above:

Name of Director Date of grant Exercise price per share (HK$)	Number of share options
	Outstanding as at 1st January, 2006 Exercised during the period Outstanding as at the Latest Practicable Date
Mr. Zhu Jinkun 14/01/20041 9.720 04/10/20042 10.350	78,0003 36,000 42,000 200,0003 200,000 –

Notes:

1. The share options are exercisable in 4 tranches, from 14th January, 2004 and from 1st January, 2005, 2006 and 2007 to 13th January, 2014.

2. The share options are exercisable within a period of 10 years from the date of grant of the relevant options.

3. Mr. Zhu Jinkun was deemed to be interested in the underlying shares through the interests of his spouse.

– 13 –

GENERAL INFORMATION

APPENDIX

• (c) Interests in issued ordinary shares and underlying shares of China Resources Power Holdings Company Limited (“CRP”), an associated corporation of the Company

				Number of	Aggregate
		Long or short	Number of	share	percentage
Name of Director	Capacity	position	shares	options1	of interest2
Mr. Zhu Jinkun	Beneficial owner	Long position	–	500,000	0.01%
Mr. Wang Guoping	Beneficial owner	Long position	–	450,000	0.01%
Mr. Ong Thiam Kin	Beneficial owner	Long position	–	250,000	0.01%
Mr. Yu Yu	Beneficial owner	Long position	–	250,000	0.01%

Notes:

1. This refers to the number of underlying shares of CRP covered by the share options granted under the share options scheme of CRP, such options being unlisted physically settled equity derivatives, particulars of which as required to be disclosed under Rule 17.07(1) of the Listing Rules are set out in Note 3 below.

2. This represents the percentage of aggregate long position in ordinary shares and underlying shares to the total issued share capital of CRP as at the Latest Practicable Date.

3. Particulars of share options referred to in Note 1 above:

Name of Director Date of grant Exercise price per share (HK$)	Number of share options
	Outstanding as at 1st January, 2006 Exercised during the period Outstanding as at the Latest Practicable Date
Mr. Zhu Jinkun 12/11/20031 2.800 Mr. Wang Guoping 12/11/20031 2.800 Mr. Ong Thiam Kin 12/11/20031 2.800 Mr. Yu Yu 12/11/20031 2.800	500,000 – 500,000 450,000 – 450,000 250,000 – 250,000 250,000 – 250,000

Note:

1. The options are exercisable in 5 tranches, from 6th October, 2004, 2005, 2006, 2007 and 2008 to 5th October, 2013.

– 14 –

GENERAL INFORMATION

APPENDIX

• (d) Interests in issued ordinary shares and underlying shares of China Resources Land Limited (“CR Land”), an associated corporation of the Company

				Number of	Aggregate
		Long or short	Number of	share	percentage
Name of Director	Capacity	position	shares	options1	of interest2
Mr. Zhu Jinkun	Beneficial owner	Long position	100,000	–	0.003%
Notes:

1. This refers to the number of underlying shares of CR Land covered by the share options granted under the share options scheme of CR Land, such options being unlisted physically settled equity derivatives.

2. This represents the percentage of aggregate long position in ordinary shares and underlying shares to the total issued share capital of CR Land as at the Latest Practicable Date.

3. SUBSTANTIAL SHAREHOLDERS

Save as disclosed below, the Directors and chief executive of the Company are not aware that there was any party (other than a Director or chief executive of the Company), who, as at the Latest Practicable Date had 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 or who was directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote at general meeting of any other member of the Group:

(a) Long position in the Company

			Percentage of
			aggregate long
			position in shares
			to the issued share
			capital of the
Name of Shareholder	Capacity	Number of shares	Company
Gold Touch Enterprises Inc.	Beneficial owner	297,229,604	11.12%
(“Gold Touch”)
Waterside Holdings Limited	Beneficial owner	535,347,743	20.04%
(“Waterside”)
Splendid Time Investments Inc.	Beneficial owner	1,109,688,810	41.53%
(“Splendid Time”)
China Resources (Holdings)	Beneficial owner	4,836,000	0.18%
Company Limited (“CRH”)

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GENERAL INFORMATION

APPENDIX

			Percentage of	Percentage of
			aggregate long
			position in shares
			**to the **	issued share
			capital of the
Name of Shareholder	Capacity	Number of shares		Company
China Resources (Holdings)	Interest of controlled	1,942,266,157		72.69%
Company Limited (“CRH”)	corporation
CRC Bluesky Limited	Interest of controlled	1,947,102,157		72.87%
(“CRC Bluesky”)	corporation
China Resources Co., Limited	Interest of controlled	1,947,102,157		72.87%
(“CRCL”)	corporation
China Resources National	Interest of controlled	1,947,102,157		72.87%
Corp. (“CRN”)	corporation

Gold Touch, Waterside and Splendid Time each directly holds 297,229,604 shares, 535,347,743 shares and 1,109,688,810 shares respectively in the Company as at the Latest Practicable Date. Gold Touch, Waterside and Splendid Times are wholly owned subsidiaries of CRH, which is therefore deemed to own 1,942,266,157 shares of the Company as at the Latest Practicable Date. In addition, CRH directly owns 4,836,000 shares in the Company. CRH is a wholly owned subsidiary of CRC Bluesky. CRC Bluesky is a wholly owned subsidiary of CRCL, which in turn is 99.98% owned by CRN. CRN is deemed to have interest in 1,947,102,157 shares.

The Company’s Director namely, Mr. Zhu Jinkun is a director of both Waterside and CRH.

(b) Of other members of the Group

So far as is known to any Director or chief executive of the Company, as at the Latest Practicable Date, the following persons were, directly or indirectly, interested in 10% or more of the share capital carrying rights to vote at general meetings of the following members of the Group:

	Name of substantial	Percentage of
Members of the Group	Shareholder	shareholding
China Resources (Shenyang)	Sanyo Electric Co., Ltd.	34.25%
Sanyo Compressor Co., Ltd.
Shenyang Shengrun Sanyo	Sanyo Electric Co., Ltd.	34.25%
Compressor Co., Ltd.
MAT	SCL	25.00%

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GENERAL INFORMATION

APPENDIX

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors has entered or proposed to enter into a 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. COMPETING BUSINESS

None of the Directors and his respective associates has an interest in a business apart from the Company’s business which competes or is likely to compete, either directly or indirectly, with the Company’s businesses.

6. LITIGATION

Neither the Company nor any member of the Group is engaged in any litigation or arbitration or claim of material importance and, so far as the Directors are aware, no litigation, arbitration or claim of material importance is pending or threatened against any member of the Group.

7. GENERAL

• (a) The secretary of the Company is Mr. LEE Yip Wah, Peter who is a solicitor of the High Court of Hong Kong.

• (b) The qualified accountant of the Company appointed pursuant to Rule 3.24 of the Listing Rules is Mr. ONG Thiam Kin, who is a fellow member of the Association of Chartered Certified Accountants in the United Kingdom, the Hong Kong Institute of Certified Public Accountants and members of the national accounting bodies of Singapore and Malaysia.

• (c) The registered office of the Company is situated at Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda and the principal place of business of the Company is situated at Rooms 4003-06, 40th Floor, China Resources Building, 26 Harbour Road, Wanchai, Hong Kong.

• (d) The Company’s Hong Kong branch share registrar is Secretaries Limited, which is situated at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong.

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