Long Investment Corp — Proxy Solicitation & Information Statement 2007

Mar 8, 2007

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Shui On Construction and Materials Limited (the “Company”), you should at once hand this circular and the accompanying form of proxy to the purchaser, transferee or to the bank, stockbroker or other agent through whom the sale or 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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(Stock Code: 983)

NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

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

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A letter from the Board is set out on pages 3 to 7 of this circular and a letter from the Independent Board Committee is set out on pages 8 and 9 of this circular. A letter from Access Capital, the independent financial adviser to the Independent Board Committee and the Independent Shareholders, containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 10 to 19 of this circular.

A notice convening a special general meeting of the Company to be held at Room 103, 1st Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong on Thursday, 12 April 2007 at 4:15 p.m. is set out in the accompanying notice of special general meeting. Whether or not you are able to attend the special general meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the head office of the Company at 34th Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong as soon as possible and, in any event, not less than 48 hours before the appointed time for the holding of the meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting and any adjourned meeting (as the case may be) should you so wish.

* For identification purpose only

8 March 2007

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Letter from Access Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Appendix — General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20

— i —

DEFINITIONS

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

• “Access Capital”

Access Capital Limited, the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Framework Agreement (together with the Cap) and the Continuing Connected Transactions, and a licensed corporation for Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities under the SFO;

“associate(s)”

• has the meaning ascribed to them respectively under the Listing Rules;

• “Board”

the board of directors of the Company;

the cap described under the section headed “Framework Agreement”; Shui On Construction and Materials Limited, a company incorporated in Bermuda and listed on the main board of the Stock Exchange;

• “Cap”

“Company” or “SOCAM” Shui On Construction and Materials Limited, a company incorporated in Bermuda and listed on the main board of the Stock Exchange; “connected person(s)” has the meaning ascribed to them respectively under the Listing Rules; “Construction Services” the provision by SSOC to SOL and/or its subsidiaries of construction services, including but not limited to civil engineering, electrical work and fitting out work for building construction, and decoration and renovation work, all in respect of property development projects in the PRC;

• “Continuing Connected the transactions contemplated under the Framework Transactions” Agreement;

• “Directors” the directors of SOCAM;

• “Framework Agreement”

the construction services framework agreement dated 4 June 2006 entered into between SSOC and SOL;

“Group” “Hong Kong”

SOCAM and its subsidiaries (as defined under the Listing Rules);

Hong Kong Special Administrative Region of the PRC;

“Independent Board Committee”

the committee of the Board, consisting of Mr. Anthony Griffiths, Mr. Cheng Mo Chi, Moses and Professor K.C. Chan, all being independent non-executive Directors;

— 1 —

	DEFINITIONS
“Independent Shareholders”	the shareholders of SOCAM, other than Mr. Lo Hong		Sui,
	Vincent and his associates (as defined under the Listing
	Rules);
“Latest Practicable Date”	5 March 2007, being the latest practicable	date	for
	ascertaining certain information for inclusion	into	this
	circular;
“Listing Rules”	the Rules Governing the Listing of Securities on	the Stock
	Exchange;
“Non-tender Contracts”	the non-tender contracts described under the section headed
	“Framework Agreement”;
“PRC”	the People’s Republic of China;
“RMB”	Renminbi, the lawful currency of the PRC;
“SFO”	the Securities and Futures Ordinance (Chapter 571 of		the
	Laws of Hong Kong);
“SGM”	the special general meeting of SOCAM to be	held	for
	approving the Continuing Connected Transactions;
“Shareholders”	the shareholders of SOCAM from time to time;
“Shui On Group”	Shui On Company Limited and its subsidiaries;
“SOL”	Shui On Land Limited, a company incorporated in		the
	Cayman Islands and listed on the main board of	the Stock
	Exchange;
“SOL Group” “SSOC”	SOL and its subsidiaries; (Shanghai Shui On Construction		Co.,
	Ltd.), a 70% owned subsidiary of SOCAM;
“sq.m.”	square metres;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited;
“Tender Contracts”	the tender contracts described under the section headed
	“Framework Agreement”;
“%”	per cent.

For illustration purpose, conversion of RMB to HK$ is based on the exchange rate of RMB1.00 = HK$1.00.

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LETTER FROM THE BOARD

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(Incorporated in Bermuda with limited liability)

(Stock Code: 983)

Executive Directors:

Mr. Lo Hong Sui, Vincent (Chairman) Mr. Choi Yuk Keung, Lawrence (Vice-chairman) Mr. Wong Yuet Leung, Frankie (Chief Executive Officer) Mr. Wong Fook Lam, Raymond Mrs. Lowe Hoh Wai Wan, Vivien

Non-Executive Director:

Professor Michael John Enright

Independent Non-Executive Directors:

Registered office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Head office: 34th Floor Shui On Centre 6-8 Harbour Road Hong Kong

Mr. Anthony Griffiths Mr. Cheng Mo Chi, Moses Professor K.C. Chan

8 March 2007

To the Shareholders

Dear Sir or Madam,

NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

The Directors announced on 15 February 2007 that as a result of SSOC becoming a subsidiary of SOCAM on 1 October 2006 following the Company gaining control of the board of SSOC, construction contracts awarded by the SOL Group in favour of SSOC under the Framework Agreement became continuing connected transactions of SOCAM.

Mr. Lo Hong Sui, Vincent is the chairman of SOCAM and has an interest in 64.08% of the issued share capital of SOCAM. Mr. Lo is also the chairman of SOL in which he has an interest in 53.78% of its issued share capital and, therefore, SOL is an associate of connected person of SOCAM. Accordingly, the engagement by the SOL Group of SSOC as a construction contractor for the provision of the Construction Services to the SOL Group pursuant to the Framework Agreement constitutes non-exempt continuing connected transactions of SOCAM.

* For identification purpose only

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LETTER FROM THE BOARD

FRAMEWORK AGREEMENT

SSOC and SOL entered into the Framework Agreement on 4 June 2006 in order to facilitate provision by SSOC of the Construction Services to the SOL Group and to establish the maximum amount of construction works which may be awarded by the SOL Group in favour of SSOC each year. SSOC was accounted for as a jointly-controlled entity by SOCAM until SSOC became a subsidiary of SOCAM on 1 October 2006.

Under the Framework Agreement, an annual cap for each of the three financial years ending 31 December 2008 was agreed as set out below:

For construction contracts less than RMB1,000,000 each (“ Non-tender Contracts ”):

• (a) SSOC may provide the SOL Group with the Construction Services from time to time on such normal commercial terms as SSOC and SOL may agree with each other provided that the contract price shall be based on prevailing market rates or, if no prevailing market price is available, fair and reasonable prices determined by arm’s length negotiations with reference to prevailing rates for materials and labour as published in the relevant provincial or city guidelines; and

• (b) SOL is not bound to contract with SSOC for the Construction Services and has the right to choose independent third party contractors at their discretion.

For construction contracts each of RMB1,000,000 or more (“ Tender Contracts ”):

• (a) SSOC may bid for construction contracts put out to tender by SOL in accordance with its tendering procedures from time to time in place on the same terms as offered to other independent third parties; and

• (b) if any construction contract is granted to SSOC as a result of a successful bid, SSOC will provide the Construction Services to the SOL Group based on the terms of the successful bid.

The Directors propose that the annual total payment receivable for all Construction Services provided by SSOC to the SOL Group for the three years ending 31 December 2008 shall not exceed RMB285 million, RMB535 million and RMB750 million respectively (the “ Cap ”).

The total payment receivable by SSOC for all Construction Services provided by SSOC to the SOL Group for the financial period commenced 1 January 2006 and ended 31 December 2006 amounted to approximately RMB27 million.

A total of 18 construction projects were awarded by the SOL Group to SSOC in 2006 with an aggregate contract amount of approximately RMB138.5 million. Of these 18 projects, 13 projects were non-Tender Contracts (aggregating to RMB7.5 million) and 5 projects were Tender Contracts (aggregating to RMB131.0 million).

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LETTER FROM THE BOARD

The Cap was calculated with reference to the Cap set by SOL based on the following factors:

• (i) total annual amounts payable by SOL to SSOC under the construction contracts for each of the past three years ended 31 December 2005 of approximately RMB23.8 million, RMB36.5 million and RMB98.1 million respectively;

• (ii) the amount potentially payable to SSOC could (but may not) increase substantially for the three years ending 31 December 2008 due to the large volume of additional construction work budgeted by SOL resulting from the commencement of construction projects in Shanghai, Wuhan and Chongqing.

THE REASON FOR AND BENEFIT OF THE CONTINUING CONNECTED TRANSACTIONS

With SOL’s participation in the property development market in the PRC, the Continuing Connected Transactions provide an excellent opportunity for the Group to engage in construction works in the PRC.

The Directors (including the independent non-executive Directors of SOCAM whose views are set out in this circular together with the opinion of the independent financial adviser appointed to advise them) confirm that the Continuing Connected Transactions were entered into in the ordinary and usual course of business of the Group, the Framework Agreement (together with the Cap) was agreed on normal commercial terms after arm’s length negotiations between the parties, and the terms of the Framework Agreement and the Continuing Connected Transactions (together with the Cap) are fair and reasonable and in the interests of the Shareholders as a whole.

Shareholders should note that the Cap represents the best estimate by the Directors of the aggregate annual amounts of the relevant transactions based on the information currently available. The Cap bears no direct relationship to, nor should be taken to have any direct bearing on, the Group’s financial or potential financial performance. SSOC may or may not provide Construction Services to the SOL Group up to the level of the Cap, if at all, as its engagement (other than to execute Non-tender Contracts) is subject to tender procedures which are open to other independent third party contractors.

LISTING RULES’ IMPLICATIONS

The applicable percentage ratios as defined under Rule 14A.10 of the Listing Rules calculated for SOCAM with reference to the Cap exceed 2.5%. As such, SOCAM is required to comply with the annual review, reporting, announcement and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the Framework Agreement and the Continuing Connected Transactions.

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LETTER FROM THE BOARD

SOCAM will seek the Independent Shareholders’ approval of the Framework Agreement and the Continuing Connected Transactions at the SGM by way of poll. Mr. Lo Hong Sui, Vincent who holds approximately 64.08% and 53.78% of the issued share capital of SOCAM and SOL respectively and his associates (as defined under the Listing Rules) shall abstain from voting at the SGM. An independent financial adviser was appointed to advise on whether the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been agreed on normal commercial terms and are fair and reasonable and in the interests of SOCAM and the Shareholders as a whole. The Company will take such steps as may be appropriate to ensure compliance with the Listing Rules if the Framework Agreement and the Continuing Connected Transactions are not approved by the Independent Shareholders at the SGM.

GENERAL

The Group is engaged principally in distressed property development, construction, cement production, investment in property development, and venture capital investment in Hong Kong, Macau and the PRC.

The SOL Group is engaged principally in developing large-scale, mixed-used, city-core development projects and integrated residential development projects in the PRC.

SPECIAL GENERAL MEETING

The notice convening the SGM to be held on Thursday, 12 April 2007 at 4.15 p.m., at which an ordinary resolution will be proposed to approve the Framework Agreement (together with the Cap) and the Continuing Connected Transactions, is set out in the accompanying notice of special general meeting.

A form of proxy for use at the SGM is enclosed. Whether or not you are able to attend the meeting, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon to the head office of the Company at 34th Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong as soon as possible and, in any event, not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting and any adjourned meeting (as the case may be) should you so wish.

PROCEDURE FOR VOTING BY POLL

In accordance with bye-law 66 of the bye-laws of the Company, a resolution put to the vote of a general meeting shall be decided on a show of hands unless (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded:

• (a) by the chairman of such meeting; or

• (b) by at least three members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy for the time being entitled to vote at the meeting; or

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LETTER FROM THE BOARD

• (c) by a member or members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy and representing not less than one-tenth of the total voting rights of all members having the right to vote at the meeting; or

• (d) by a member or members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy and holding shares in the Company conferring a right to vote at the meeting being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all shares conferring that right.

A demand by a person as proxy for a member or in the case of a member being a corporation by its duly authorised representative shall be deemed to be the same as a demand by a member.

RECOMMENDATION

The Directors consider that the Framework Agreement and the Continuing Connected Transactions have been entered into in the ordinary and usual course of business of the Group and the Framework Agreement (together with the Cap) and the Continuing Connected Transactions, have been agreed on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole, and recommend the Independent Shareholders to vote in favour of the relevant ordinary resolution to be proposed at the SGM.

Your attention is drawn to the letter from the Independent Board Committee set out on pages 8 and 9 of this circular which contains its recommendation to the Independent Shareholders on the Framework Agreement (together with the Cap) and the Continuing Connected Transactions. Your attention is also drawn to the letter of advice received from Access Capital which contains its advice to the Independent Board Committee and the Independent Shareholders in relation to the Framework Agreement (together with the Cap) and the Continuing Connected Transactions. The letter from Access Capital is set out on pages 10 to 19 of this circular.

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

Yours faithfully, By Order of the Board Shui On Construction and Materials Limited Lo Hong Sui, Vincent Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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(Incorporated in Bermuda with limited liability) (Stock Code: 983)

8 March 2007

To the Independent Shareholders

Dear Sir or Madam,

NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

We refer to the circular dated 8 March 2007 of the Company (the “Circular”) of which this letter forms part. Terms defined in the Circular bear the same meanings herein unless the context requires otherwise.

We have been appointed to form the Independent Board Committee to consider the Framework Agreement (together with the Cap) and the Continuing Connected Transactions and to advise the Independent Shareholders whether, in our opinion, the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been entered into in the ordinary and usual course of business of the Group and the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been agreed on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Access Capital has been appointed to advise the Independent Board Committee and the Independent Shareholders whether the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been entered into in the ordinary and usual course of business of the Group and the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been agreed on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

We wish to draw your attention to the letter from the Board set out on pages 3 to 7 of the Circular which contains information about the Framework Agreement and the letter of advice from Access Capital set out on pages 10 to 19 of the Circular which contains advice in respect of the Framework Agreement (together with the Cap) and the Continuing Connected Transactions.

* For identification purpose only

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having taken into account the advice of Access Capital, we consider that the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been entered into in the ordinary and usual course of business of the Group and the Framework Agreement (together with the Cap) and the Continuing Connected Transactions have been agreed on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole, and we recommend the Independent Shareholders to vote in favour of the relevant ordinary resolution as set out in the notice of the SGM.

Yours faithfully,

For and on behalf of

Shui On Construction and Materials Limited

Anthony Griffiths	Cheng Mo Chi, Moses	K.C. Chan
Independent Non-executive	Independent Non-executive	Independent Non-executive
Director	Director	Director
	(Chairman of Independent Board Committee)

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LETTER FROM ACCESS CAPITAL

The following is the full text of the letter of advice to the Independent Board Committee and the Independent Shareholders from Access Capital prepared for incorporation in this circular.

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Suite 606, 6th Floor Bank of America Tower 12 Harcourt Road Central Hong Kong

8 March 2007

To: The Independent Board Committee and the Independent Shareholders of Shui On Construction and Materials Limited

Dear Sirs,

NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

I. INTRODUCTION

We refer to our appointment to advise the Independent Board Committee and the Independent Shareholders of Shui On Construction and Materials Limited (the “Company”) with regard to the terms of the Framework Agreement dated 4 June 2006, entered into between SSOC, a 70% owned subsidiary of SOCAM, and SOL in order to facilitate the provision by SSOC of Construction Services to the SOL Group and to provide the maximum amount of construction works which may be awarded by SOL Group in favour of SSOC each year.

Details of the Framework Agreement are contained in the “Letter from the Board” in the circular to the Shareholders dated 8 March 2007 (the “Circular”), of which this letter forms part. Terms used in this letter shall have the same meaning as those defined in the Circular unless the context specifies otherwise.

The Directors announced that as a result of SSOC becoming a subsidiary of SOCAM on 1 October 2006, construction contracts awarded by the SOL Group in favour of SSOC under the Framework Agreement became continuing connected transactions of SOCAM. SSOC was accounted for as a jointly-controlled entity by SOCAM until SSOC became a subsidiary of SOCAM on 1 October 2006 following the Company gaining control of the board of SSOC.

At the Latest Practicable Date, Mr. Lo Hong Sui, Vincent is the chairman of SOCAM and has an interest in 64.08% of the issued share capital of SOCAM. Mr. Lo is also the chairman of SOL in which he has an interest in 53.78% of its issued share capital and therefore, SOL is an associate of a

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LETTER FROM ACCESS CAPITAL

connected person of SOCAM. Accordingly, the engagement by the SOL Group of SSOC as a construction contractor for the provision of the Construction Services to it pursuant to the Framework Agreement constitutes non-exempt continuing connected transactions of SOCAM. As such, SOCAM is required to comply with the annual review, reporting, announcement and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the Framework Agreement and the Continuing Connected Transactions.

II. THE INDEPENDENT BOARD COMMITTEE

The Board currently consists of 5 executive Directors, namely Mr. LO Hong Sui, Vincent, Mr. CHOI Yuk Keung, Lawrence, Mr. WONG Yuet Leung, Frankie, Mr. WONG Fook Lam, Raymond and Mrs. LOWE Hoh Wai Wan, Vivien; 1 non-executive Director, namely Professor Michael John ENRIGHT, and 3 independent non-executive Directors, namely Mr. Anthony GRIFFITHS, Mr. CHENG Mo Chi, Moses and Professor K.C. CHAN.

The Independent Board Committee comprising, the independent non-executive Directors, Mr. Anthony GRIFFITHS, Mr. CHENG Mo Chi, Moses and Professor K.C. CHAN, has been established to consider the terms of the Framework Agreement (together with the Cap) and the Continuing Connected Transactions.

We have been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Framework Agreement (together with the Cap) and the Continuing Connected Transactions are fair and reasonable so far as the Independent Shareholders are concerned, and to give our opinion in relation to the Framework Agreement (together with the Cap) and the Continuing Connected Transactions for the Independent Board Committee’s consideration when making their recommendation to the Independent Shareholders.

III. BASES AND ASSUMPTIONS OF THE ADVICE

In formulating our advice, we have relied solely on the statements, information, opinions and representations contained in the Circular and the information and representations provided to us by the Company and/or its senior management staff and/or the Directors. We have assumed that all such statements, information, opinions and representations contained or referred to in the Circular or otherwise provided or made or given by the Company and/or its senior management staff and/or the Directors and for which it is/they are solely responsible were true and accurate and valid at the time they were made and given and continue to be true and valid at the date of the Circular. We have assumed that all the opinions and representations made or provided by the Directors and/or the senior management staff of the Company contained in the Circular have been reasonably made after due and careful enquiry. We have also sought and obtained confirmation from the Company and/or its senior management staff and/or the Directors that no material facts have been omitted from the information provided and referred to in the Circular.

We consider that we have reviewed all currently available information and documents which are available to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our opinions. We have no reason to doubt the truth, accuracy and completeness of the statements, information, opinions and representations provided to

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LETTER FROM ACCESS CAPITAL

us by the Company and/or its senior management staff and/or the Directors and their respective advisers or to believe that material information has been withheld or omitted from the information provided to us or referred to in the aforesaid documents. We have not, however, carried out an independent verification of the information provided, nor have we conducted an independent investigation into the business and affairs of the Company or any of its subsidiaries.

IV. PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our recommendation, we have taken into consideration the following principal factors and reasons:

1. Background to and reasons for the Framework Agreement

The Group is engaged principally in distressed property development, construction, cement production, investment in property development, and venture capital investment in Hong Kong, Macau and the PRC. SSOC, a 70% owned subsidiary of the Group, is engaged in the provision of building construction and maintenance.

The SOL Group is engaged principally in developing large-scale, mixed-used, city-core development projects and integrated residential development projects in the PRC. The shares of SOL were listed on the Stock Exchange on 4 October 2006. As stated in the prospectus of SOL dated 20 September 2006 (the “Prospectus”), SOL is the flagship property company of the Shui On Group and under the leadership of Mr. Lo Hong Sui, Vincent, the Shui On Group has over 20 years of experience of property development in the PRC and over 30 years of construction related experience in Hong Kong. As stated in the Prospectus, SOL, a leading property developer in the PRC with projects in Shanghai, Hangzhou, Chongqing and Wuhan, had a total land bank of over 8.1 million sq. m of gross floor area (“ GFA ”) and open areas and other public facilities. In addition, SOL intended to continue to pursue further property development projects as well as to enhance its geographic diversification by undertaking projects in appropriate regions in new cities.

In the past, SOL had engaged SSOC to provide certain Construction Services. For each of the past three years ended 31 December 2005, the annual amounts payable by SOL to SSOC for the Construction Services were approximately RMB23.8 million, RMB36.5 million and RMB98.1 million respectively. With the already established business relationship between SSOC and SOL, as well as SSOC’s familiarity with SOL’s management style and understanding of SOL’s construction requirement and standards, SSOC is well positioned to provide the necessary construction experience and expertise to assist SOL.

On 4 June 2006, SSOC and SOL entered into the Framework Agreement in order to formalise the provision by SSOC of the Construction Services to the SOL Group and to establish the maximum amount of construction works which may be awarded by SOL Group in favour of SSOC each year. With effect from 1 October 2006, when SSOC became a subsidiary of SOCAM, the provision of the Construction Services to the SOL Group by SSOC constituted connected transactions as defined in the Listing Rules, subject to reporting, disclosure and (as appropriate) independent shareholders’ approval at general meeting.

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LETTER FROM ACCESS CAPITAL

Given the entering into of the Framework Agreement would allow the Group to enjoy (i) a fair chance to involve in the Non-tender Contracts (as defined below) and/or to participate in the tendering process of the Tender Contracts (as defined below) for construction works in the PRC; and (ii) the strategic benefit (in terms of business flow) to the Group vis-a`-vis the future expansion of SOL’s property development business in the PRC; we are of the view that the entering into of the Framework Agreement is in line with the Group’s corporate strategy to engage in construction works in cities with growth potential.

Since one of the principal businesses of the Group is related to construction and contracting and SOL is engaged in property development in the PRC, we concur with the Directors’ view that the entering into of the Framework Agreement and the transactions contemplated thereunder fall within the ordinary and usual course of business of the Group.

2. Terms of the Framework Agreement and the Cap

Terms of the Framework Agreement

The following diagram sets out the shareholding and corporate structure of SOCAM, SOL and SSOC:

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Mr. Lo Hong Sui, Vincent
64.08% 53.78%
SOCAM SOL
70% Framework
Agreement
SSOC
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• Of the 53.78% interest in SOL, approximately 17.84% is held through SOCAM.

The following is a summary of the principal terms of the Framework Agreement:

Under the Framework Agreement, an annual cap for each of the three financial years ending 31 December 2008 was agreed and is set out below:

For construction contracts with a contract sum less than RMB1,000,000 (“ Non-tender Contracts ”):

• (a) SSOC may provide the SOL Group with the Construction Services from time to time on such normal commercial terms as SSOC and SOL may agree with each other provided that

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LETTER FROM ACCESS CAPITAL

• the contract price shall be based on prevailing market rates or, if no prevailing market price is available, fair and reasonable prices based on arm’s length negotiations with reference to prevailing rates for material and labour as published in the relevant provincial or city guidelines; and

• (b) SOL is not bound to contract with SSOC for the Construction Services and has the right to choose independent third party contractors at their discretion.

We have reviewed 10 Non-tender Contracts (out of a total of 13 Non-tender Contracts awarded by the SOL Group to SSOC in 2006) and note from the senior management that the contract sums for Non-tender Contracts quoted by SSOC were based on arm’s length negotiations with reference to prevailing rates for material and labour costs as quoted from independent suppliers.

For construction contracts with a contract sum of RMB1,000,000 or more (“ Tender Contracts ”):

• (a) SSOC may bid for construction contracts put out to tender by SOL in accordance with its tendering procedures from time to time in place on the same terms as offered to other independent third parties; and

• (b) if any construction contract is granted in favour of SSOC as a result of a successful bid, SSOC will provide the Construction Services to the SOL Group based on the terms of the successful bid.

We have also reviewed 5 Tender Contracts (being all of the Tender Contracts awarded by the SOL Group to SSOC in 2006) and we note from the Company/SOL that the quantity surveying department of SOL is responsible for inviting pre-qualified contractors to submit their bids for the construction work. The decision to award is vested with the procurement committee for the relevant project and is made on the basis of capability to satisfy contract requirements, qualifications, reputation for reliability, quality and price (the “ Tendering Procedure ”).

In tendering for the Tender Contracts, SSOC prepares estimates based on:

• the quantum of the work specified in the tender documents;

• the labour, materials and management required to deliver the work to the standards specified within the contract period set out in the tender documents;

• the costs at which it can obtain the materials and labour and, if appropriate, the rates of inflation in these inputs expected to occur during the contract period that may be applicable;

• reasonable allowances for wastage and rework;

• contract administration costs; and

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LETTER FROM ACCESS CAPITAL

• a rate of profit based on costs that is competitive with the market place for similar types of work in the specific location.

We believe the tendering process outlined above is fair and reasonable and is in the interests of Shareholders as a whole.

Taking into account (i) the background to and reasons for the Framework Agreement set out in paragraph 1 above; (ii) the provision of construction work is in the ordinary and usual course of business of the Group, granted on normal commercial terms and negotiated on an arm’s length basis as described above; (iii) the contract price for Non-tender Contacts is based on prevailing market rates and arm’s length negotiations with reference to prevailing rates for material and labour costs from independent suppliers; and (iv) the contract price for Tender Contracts is based on the Tendering Procedure, we concur with the Directors, and are of the view, that the transactions contemplated under the Framework Agreement are on normal commercial terms and such terms are fair and reasonable and in the interests of the Shareholders as a whole.

The Cap

The Directors propose that the annual total payment receivable for all Construction Services provided by SSOC to the SOL Group for each of the three years ending 31 December 2008 shall not exceed RMB285 million, RMB535 million and RMB750 million respectively (the “ Cap ”).

The total amount of payment receivable by SSOC for all Construction Services provided by SSOC to SOL Group for the financial year that commenced 1 January 2006 and ended 31 December 2006 amounted to approximately RMB27 million.

According to the Company, a total of 18 construction projects were awarded by the SOL Group to SSOC in 2006 with an aggregate contract amount of approximately RMB138.5 million. Of these 18 construction projects, 13 were Non-tender Contracts (total contract sum: RMB7.5 million) and 5 were Tender Contracts (total contract sum: RMB131.0 million).

The Cap was calculated with reference to the following factors:

• (i) total annual amounts payable by SOL to SSOC under the construction contracts for each of the past three years ended 31 December 2005 of approximately RMB23.8 million, RMB36.5 million and RMB98.1 million respectively; and

• (ii) the amount potentially payable to SSOC could (but may not) increase substantially for the three years ending 31 December 2008 due to the large volume of additional construction work budgeted by SOL as a result of the commencement of construction projects in Shanghai, Wuhan and Chongqing.

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LETTER FROM ACCESS CAPITAL

3. The proposed cap amounts for the Continuing Connected Transactions

According to the Directors, the cap amounts of the Continuing Connected Transactions under the Framework Agreement for the three years ending 31 December 2008 will not exceed:

		**For **	the year ended	**For **	the year ending	**For **	the year ending
		**31 **	December 2006	**31 **	December 2007	**31 **	December 2008
			RMB		RMB		RMB
Annual	cap		285,000,000		535,000,000		750,000,000
Growth	rate		N.A.		87.7%		40.2%
Actual	payment		27,000,000		N.A.		N.A.

We note that the Directors agreed the annual cap for the year ended 31 December 2006 at RMB285 million whilst the actual payment received by SSOC for all Construction Services provided by SSOC to the SOL Group in that year amounted to approximately RMB27 million, representing only a fraction of the total cap for the period.

Based on the amount of the actual payment of RMB27 million, each of the relevant percentage ratios under Rule 14.04(9) of the Listing Rules is less than 2.5% and is only subject to reporting and announcement requirements under Rules 14A.45 to 14A.47 of the Listing Rules and exempt from independent shareholders’ approval. Notwithstanding the fact that the total payment for the Construction Services for the financial year ended 31 December 2006 was exempted from Independent Shareholders’ approval, we note that (i) all the Tender Contracts with a total contract sum of RMB131.0 million were awarded in the second half of 2006 following the entering into of the Framework Agreement; (ii) the payment was made by stages with reference to the amount of work done and certified by an independent quantity surveyor; and (iii) SOL had also sought a cap of the same amount as stated in the Prospectus which forms a reasonable basis for the Directors to determine the amount of Construction Services to be provided by SSOC for SOL. In view of these reasons, we concur with the Directors and are of the opinion that it is reasonable and justifiable to have set an annual cap of RMB285 million for the year ended 31 December 2006.

In respect of the caps for the two years ending 31 December 2008, we note from the Directors that there is expected to be a substantial increase in the amount payable to SSOC for the provision of Construction Services due to the large volume of additional construction work budgeted by SOL as a result of the commencement of construction projects in Shanghai, Wuhan and Chongqing as well as the potential to further develop in these cities. As stated in the Prospectus, on 30 June 2006, SOL had access to over 8.1 million sq. m. of GFA and open areas and other public facilities comprising six major multi-phase projects with an estimated, aggregate, leaseable and saleable GFA of approximately 6.7 million sq. m. and approximately 1.4 million sq. m. of open areas and other public facilities, of which (i) Shanghai projects account for an aggregate of approximately 2.7 million sq. m. of estimated leaseable and saleable GFA; (ii) the Wuhan project accounts for approximately 1.4 million sq. m. of estimated leaseable and saleable GFA; and (iii) the Chongqing project accounts for approximately 2.6 million sq. m. of estimated leaseable and saleable GFA.

In order to assess the reasonableness of the cap amounts for the two years ending 31 December 2008, we have also considered certain related information with respect to property development projects of SOL located in various cities in the PRC, namely, in Shanghai, Wuhan and Chongqing.

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LETTER FROM ACCESS CAPITAL

Overall real estate market in Shanghai

Shanghai is one of the four municipalities in the PRC under direct administration of the PRC central government. According to the National Bureau of Statistics of China, at 31 December 2005, Shanghai had a population of approximately 13.6 million.

Shanghai experienced substantial Gross Domestic Product (“ GDP ”) growth rates for the five years from 2001 to 2005. In 2005, Shanghai’s GDP reached approximately RMB915.4 billion, representing a per capita GDP of approximately RMB67,492. According to the National Bureau of Statistics of China, total investment in real estate was approximately RMB124.7 billion. The table below sets out selected economic statistics of Shanghai for the periods indicated:

	2001	2002	2003	2004	2005
Nominal GDP (RMB in billions)	521.0	574.1	669.4	807.3	915.4
Real GDP growth rate (%)	10.5	11.3	12.3	14.2	11.1
Per capita GDP (RMB)	39,340	43,143	50,032	59,928	67,492

Source: Shanghai Statistical Yearbook 2006, Shanghai Statistics Bureau

According to the Shanghai Statistics Bureau, a total GFA of approximately 27.4 million sq. m. of residential properties was completed in Shanghai in 2005. A total GFA of approximately 28.5 million sq. m. of residential properties was sold in Shanghai in 2005. The average selling price per sq. m. of residential properties in Shanghai increased from RMB3,326 in 2000 to approximately RMB6,698 in 2005.

According to the Shanghai Statistics Bureau, a total GFA of approximately 0.87 million sq. m. of office properties was completed in Shanghai in 2005. The average selling price per sq. m. of office properties in Shanghai increased from RMB9,223 in 2000 to approximately RMB11,867 in 2005.

Overall real estate market in Wuhan

Wuhan, located at the junction of the Yangtze and the Han Rivers, is the capital of Hubei province in central China. Total investment in real estate in Wuhan rose to RMB29.8 billion in 2005, representing an increase of 27.7% over 2004. According to the 2005 Statistical Report of the Eleventh Five Year Master Plan for Wuhan’s Economic and Social Development prepared by the Bureau of Statistics of Wuhan, at 31 December 2005, Wuhan had a population of approximately 8.58 million. The nominal GDP of Wuhan was approximately RMB223.8 billion in 2005 while real GDP growth was approximately 14.7% from 2004, representing a per capita GDP of approximately RMB26,238. The urban resident per capita disposable income in Wuhan reached approximately RMB 10,849.7 in 2005, representing an increase of approximately 13.4% over 2004.

According to the Wuhan Statistics Bureau, a total GFA of approximately 6.8 million sq. m. of commodity properties (i.e. properties available for sales) was sold in Wuhan in 2005, representing a

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LETTER FROM ACCESS CAPITAL

3.6% increase from 2004. In the same year, a total land area of about 27.5 million sq. m. was acquired for real estate development (up 12.7% from 2004). Total real estate investments in 2005 amounted to approximately RMB29.8 billion while sales of commodity properties in Wuhan in 2005 aggregated to approximately RMB19.4 billion.

“The Principal Tasks and Measures of the Eleventh Five Year Master Plan for Wuhan’s Economic and Social Development” (the “Plan”), drafted by the Wuhan city government, indicated three leading industries (trade, finance and real estate) would be given preference to expand in Wuhan in the five years of the Plan period and they are expected to increase the GDP and GDP per capita of Wuhan to approximately RMB420 billion and approximately RMB38,800 (US$5,000) by 2010 respectively.

Overall real estate market in Chongqing

Chongqing lies to the east of Sichuan Province. According to the National Bureau of Statistics of China, Chongqing had a population of approximately 27.98 million at 31 December 2005. Chongqing experienced a steady GDP growth rate for the five years from 2001 to 2005. In 2005, the nominal GDP of Chongqing reached approximately RMB306.9 billion, representing a per capita GDP of approximately RMB10,978 and total investment in real estate was approximately RMB51.8 billion. The urban resident per capita disposable income in Chongqing reached approximately RMB10,244 in 2005, representing an increase of close to 11.1% over 2004. The table below sets out selected economic statistics of Chongqing for the periods indicated:

	2001	2002	2003	2004	2005
Nominal GDP (RMB in billions)	175.0	197.1	225.1	269.0	306.9
Real GDP growth rate (%)	9.0	10.3	11.5	12.2	11.5
Per capita GDP (RMB)	5,655	6,353	8,075	9,608	10,978

Source: National Bureau of Statistics of China

Total investment in real estate in Chongqing rose significantly from approximately RMB19.7 billion in 2001 to RMB51.8 billion in 2005, representing an increase of 27.8% over 2004. A total GFA of approximately 155.98 million sq. m. of commodity properties was sold in Chongqing in 2005, representing an approximately 17.3% increase from 2004. In 2005, the total revenue from commodity property sales in Chongqing increased to approximately RMB31.3 billion, up 34.3% from 2004. Of total revenue from commodity property sales, approximately RMB22.5 billion was for residential property, representing an increase of approximately 23.8% over 2004.

In view of:

1. the favourable economic conditions of the various cities in which SOL operates, namely in Shanghai, Chongqing and Wuhan;

2. SOL’s total land bank of over 8.1 million sq. m. of GFA, open areas and other public facilities;

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LETTER FROM ACCESS CAPITAL

1. SOL’s intention to continue expanding its property development in new cities;

2. SSOC’s long term relationship with SOL and its expertise to provide the Construction Services;

We believe that it is prudent and reasonable for the Directors to determine the proposed cap amounts by reference to the large volume of additional construction work budgeted by SOL as a result of the commencement of construction projects in Shanghai, Wuhan and Chongqing. Accordingly, we are of the view that the proposed cap amounts contemplated under the Framework Agreement are fair and reasonable.

V. RECOMMENDATION

Having considered the abovementioned factors, we are of the view that terms of the Framework Agreement (together with the Cap) and the Continuing Connected Transactions were entered into in the ordinary and usual course of business of the Group and the Framework Agreement (together with the Cap) and the Continuing Connected Transactions were agreed on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned and that they are in the interests of the Company and the Independent Shareholders as a whole. Accordingly, we advise the Independent Board Committee to recommend to the Independent Shareholders that they vote in favor of the ordinary resolution to approve the entering into of the Framework Agreement (together with the Cap) and the Continuing Connected Transactions, which will be proposed at the SGM.

Yours faithfully, For and on behalf of ACCESS CAPITAL LIMITED Jeanny Leung Managing Director

— 19 —

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 not contained in this circular, the omission of which would make any statement herein misleading.

2. DISCLOSURE OF INTERESTS

(A) Interests of directors and chief executive

At the Latest Practicable Date, the interests and short positions of the Directors and the chief executive of the Company 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 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 were taken or deemed to have been taken under such provisions of the SFO) or the Model Code for Securities Transactions by Directors of Listed Companies or which were required to be entered in the register required to be kept under section 352 of the SFO were as follows:

• (a) Long position in the shares of the Company

	Number of ordinary shares	Number of ordinary shares	Approximate
	in the Company		percentage of
	Personal	Other	shareholding in
Name of Director	interests	interests	the Company
Lo Hong Sui, Vincent	—	188,915,000	66.57%
		(Note)
Choi Yuk Keung, Lawrence	740,000	—	0.26%
Wong Fook Lam, Raymond	700,000	—	0.25%
Lowe Hoh Wai Wan, Vivien	396,000	—	0.14%

Note: These shares comprise 181,871,000 shares beneficially owned by Shui On Company Limited (“SOCL”) and 7,044,000 shares and underlying shares in which SOCL is deemed to be interested under section 317 of the SFO.

Of the 181,871,000 shares beneficially owned by SOCL, 166,148,000 shares and 15,723,000 shares were held respectively by SOCL and Shui On Finance Company Limited, which is an indirect wholly-owned subsidiary of SOCL. SOCL is owned by the Bosrich Unit Trust, the trustee of which is Bosrich Holdings Inc. The units of the Bosrich Unit Trust are the property of a discretionary trust, of which Mr. Lo Hong Sui, Vincent is a discretionary beneficiary and HSBC International Trustee Limited is the trustee. Accordingly, Mr. Lo Hong Sui, Vincent, HSBC International Trustee Limited and Bosrich Holdings Inc. are deemed to be interested in such shares under the SFO.

— 20 —

GENERAL INFORMATION

APPENDIX

On 27 August 2002, SOCL granted call options over certain existing shares of the Company beneficially owned by SOCL to each of Mr. Wong Ying Wai, Wilfred (“Mr. Wilfred Wong”), Mr. Wong Hak Wood, Louis (“Mr. Louis Wong”) and Mr. Wong Yuet Leung, Frankie as part of an incentive reward for their services to the Company. A maximum of 50% of the shares transferred or to be transferred upon exercise of call options are subject to a restriction of disposal within 12 months from the date such shares are transferred. Mr. Wilfred Wong and Mr. Louis Wong have exercised all their call options and accordingly are deemed to be parties to an agreement to acquire shares under section 317 of the SFO. As such, SOCL is deemed to be interested in the shares and underlying shares owned by Mr. Wilfred Wong and Mr. Louis Wong.

(b) Short position in the shares of the Company

	Number of ordinary shares	Number of ordinary shares	Approximate
	in the Company		percentage of
	Personal	Other	shareholding in
Name of Director	interests	interests	the Company
Lo Hong Sui, Vincent	—	1,600,000	0.56%
		(Note)

Note: These shares represent the outstanding balance of the call options granted by SOCL under the call option arrangement mentioned in the note to item (a) above.

(c) Share options of the Company

At the Latest Practicable Date, the following Directors had interests in the share options granted by the Company under the share option scheme adopted by the Company on 27 August 2002:

				Number of
			Period during	the ordinary
		Subscription	which options	shares
	Date of	price per	outstanding	subject to
Name of Director	grant	share	are exercisable	the options
		HK$
Choi Yuk Keung,	27-8-2002	6.00	27-2-2003 to	168,000
Lawrence			26-8-2007
	27-8-2002	6.00	27-8-2005 to	2,175,000
			26-8-2010
	3-1-2007	16.78	3-1-2010 to	700,000
			2-1-2017	(Note)

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GENERAL INFORMATION

APPENDIX

				Number of
			Period during	the ordinary
		Subscription	which options	shares
	Date of	price per	outstanding	subject to
Name of Director	grant	share	are exercisable	the options
		HK$
Wong Yuet Leung,	27-8-2002	6.00	27-8-2005 to	1,600,000
Frankie			26-8-2010
	1-8-2006	14.00	1-2-2007 to	2,000,000
			31-7-2011
	3-1-2007	16.78	3-1-2010 to	1,500,000
			2-1-2017	(Note)
Wong Fook Lam,	1-8-2006	14.00	1-2-2007 to	176,000
Raymond			31-7-2011
	3-1-2007	16.78	3-1-2010 to	700,000
			2-1-2017
Lowe Hoh Wai Wan,	27-8-2002	6.00	27-8-2005 to	660,000
Vivien			26-8-2010
	1-8-2006	14.00	1-2-2007 to	150,000
			31-7-2011
	3-1-2007	16.78	3-1-2010 to	625,000
			2-1-2017

Note: The grant of these share options is subject to shareholders’ approval at the special general meeting to be held on 12 April 2007.

• (d) Call option over the shares of the Company

At the Latest Practicable Date, the following Director had a call option granted by SOCL over the shares of the Company pursuant to the arrangement mentioned in the note to item (a) above:

				Number of
				ordinary shares
			Exercise	subject to the
**Name **	of Director	Exercise price	period	call option
Wong	Yuet Leung, Frankie	HK$6.00	27-8-2005 to	1,600,000
			26-8-2010

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GENERAL INFORMATION

APPENDIX

• (e) Long position in the shares of SOL

Number of ordinary shares Approximate in the Company percentage of Personal Other shareholding in Name of Director interests interests the Company Lo Hong Sui, Vincent — 2,250,565,225 53.78% (Note)

Note: These shares are directly held by subsidiaries of SOCL, namely, Shui On Properties Limited, Shui On Investment Company Limited and New Rainbow Investments Limited. SOCL is owned by the Bosrich Unit Trust, the trustee of which is Bosrich Holdings Inc. The units of the Bosrich Unit Trust are the property of a discretionary trust, of which Mr. Lo Hong Sui, Vincent is a discretionary beneficiary and HSBC International Trustee Limited is the trustee. Accordingly, Mr. Lo Hong Sui, Vincent is deemed to be interested in such shares under the SFO.

Save as disclosed above, at the Latest Practicable Date, none of the Directors or chief executive of the Company had any 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 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 were taken or deemed to have taken under such provisions of the SFO) or the Model Code for Securities Transactions by Directors of Listed Companies or which were required to be entered in the register required to be kept under section 352 of the SFO.

There is no contract or arrangement subsisting at the Latest Practicable Date in which any of the Directors is materially interested and which is significant in relation to the business of the Group.

None of the Directors has had any direct or indirect interest in any assets which have since 31 March 2006 (being the date to which the latest published audited financial statements of the Company have been made up) been acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Group.

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GENERAL INFORMATION

APPENDIX

(B) Interests of shareholders discloseable pursuant to the SFO

Save as disclosed below and under the section “Interests of directors and chief executive” above, the Directors are not aware of any other person (other than a Director or Chief Executive of the Company or his/her respective associate(s)) who, at the Latest Practicable Date, had an interest or short position in the shares or 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:

==> picture [408 x 126] intentionally omitted <==

----- Start of picture text -----

||||||||
|---|---|---|---|---|---|---|
|Aggregate|interests|
|Number|of|Percentage|of|
|ordinary|shares|in|shareholding|in|
|Name|the|Company|the|Company|
|Louis|Wong|188,915,000|(Note|i)|66.57%|
|Wilfred|Wong|188,915,000|(Note|i)|66.57%|
|John|Zwaanstra|25,185,251|(Note|ii)|8.87%|
|Cheah|Cheng|Hye|14,238,000|(Note|iii)|5.02%|

----- End of picture text -----

Notes:

• (i) These shares include the aggregate interests of SOCL deemed under section 317 of the SFO as mentioned in the note to item (a) under “Interests of directors and chief executive” above.

• (ii) These shares are held by Penta Investment Advisers Limited which is wholly owned by Mr. John Zwaanstra.

• (iii) These shares are held by Value Partners Limited which is controlled by Mr. Cheah Cheng Hye.

(C) Substantial shareholding in other members of the Group

Save as disclosed below, the Directors are not aware of any other person (other than a Director or chief executive of the Company or his/her respective associate(s)) who, at the Latest Practicable Date, was directly or indirectly interested in 10 per cent or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group:

==> picture [432 x 131] intentionally omitted <==

----- Start of picture text -----

||||||||||
|---|---|---|---|---|---|---|---|---|
|Name|of|owner|of|shares|Effective|%|
|or|equity|interest|equity|interest|
|(as|the|case|may|be)|Name|of|subsidiary|held|
|Panyu|Dynamic|Mark|Steel|&|20%|
|(Guangzhou|Panyu|Guanglu|Aluminum|Engineering|Co.|Ltd.|
|Industrial|Co.,|Ltd.)|
|Eversound|Enterprise|Limited|Panyu|Dynamic|Mark|Steel|&|16%|
|Aluminum|Engineering|Co.|Ltd.|

----- End of picture text -----

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GENERAL INFORMATION

APPENDIX

==> picture [436 x 523] intentionally omitted <==

----- Start of picture text -----

|||||||||||
|---|---|---|---|---|---|---|---|---|---|
|Name|of|owner|of|shares|Effective|%|
|or|equity|interest|equity|interest|
|(as|the|case|may|be)|Name|of|subsidiary|held|
|Metro|Materials|Engineering|Lamma|Concrete|Products|Limited|40%|
|Company|Limited|
|Metro|Materials|Engineering|Guangdong|Lamma|Concrete|Products|40%|
|Company|Limited|Limited|
|Panyu|Shui|Fai|Metal|Works|22.5%|
|(Guangzhou|Panyu|Guanglu|Engineering|Company|Limited|
|Industrial|Co.,|Ltd.)|
|Hip|Kwan|Engineering|Company|Panyu|Shui|Fai|Metal|Works|22.5%|
|Limited|Engineering|Company|Limited|
|Eversound|Enterprise|Limited|Dynamic|Mark|Limited|20%|
|Hip|Kwan|Engineering|Company|Shui|Fai|Metal|Works|Engineering|22.5%|
|Limited|Company|Limited|
|Eversound|Enterprise|Limited|Shui|Fai|Metal|Works|Engineering|22.5%|
|Company|Limited|
|Ecomat|(Hong|Kong)|Limited|Pacific|Extend|Limited|18%|[*]|
|Win|Media|Limited|Pacific|Extend|Limited|10%|[#]|
|SSOC|15%|
|SSOC|15%|
|(SIG|Investment|Management|
|Co.,|Ltd.)|
|20%|
|(Chongqing|T.|H.|Desheng|Engineering|
|Co.|Ltd.)|
|Chongqing|T.|H.|Desheng|Engineering|20%|
|Co.|Ltd.|
|Chongqing|T.|H.|White|Cement|Co.|Ltd.|40%|
|45%|

----- End of picture text -----

• The 18% equity interest held by Ecomat (Hong Kong) Limited carries voting right of 11.25%.

• The 10% equity interest held by Win Media Limited carries voting right of 6.25%.

4. SERVICE CONTRACTS

At the Latest Practicable Date, no Director has a service contract with any member of the Group which is not expiring or determinable by the Company within one year without the payment of compensation other than statutory compensation.

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GENERAL INFORMATION

APPENDIX

5. MATERIAL ADVERSE CHANGE

The Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 March 2006, the date to which the latest published audited accounts of the Company have been made up.

6. COMPETING BUSINESS INTERESTS OF DIRECTORS

At the Latest Practicable Date, none of the Directors and their respective associates has any interest in a business apart from the Group’s business, which competes or is likely to compete directly or indirectly, with the Group’s business and would require disclosure under Rule 8.10 of the Listing Rules.

7. EXPERT

Access 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 and letter in the form and context in which they appear.

The qualification of the independent financial adviser who has given advice contained in this circular is set out as follows:

Name Qualification Access Capital A corporation licensed under the SFO to conduct Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities under the SFO

Access Capital has confirmed that it does not have 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 which are proposed to be acquired or disposed of by or leased to any member of the Group since 31 March 2006, being the date to which the latest published audited consolidated financial statements of the Company have been made up.

The letter of Access Capital was given at the date of this circular for incorporation herein.

8. MISCELLANEOUS

• (a) The Qualified Accountant of the Company is Mr. Wong Fook Lam, Raymond, a fellow of the Institute of Chartered Accountants in England and Wales and a fellow of the Hong Kong Institute of Certified Public Accountants.

• (b) The Secretary of the Company is Mr. Sincere Wong, a qualified lawyer in the jurisdictions of Hong Kong, England and Wales.

— 26 —

GENERAL INFORMATION

APPENDIX

• (c) The principal share registrar and the transfer office of the Company is the Bank of Bermuda Limited, 6 Front Street, Hamilton HM 11, Bermuda.

• (d) The Hong Kong branch share registrar and transfer office of the Company is Standard Registrars Limited, 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong.

• (e) The registered office of the Company is at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda. The head office and principal place of business of the Company is at 34th Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong.

• (f) The English text of this circular will prevail over the Chinese text.

9. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during business hours at the head office of the Company at 34th Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong from the date of this circular up to and including 12 April 2007:

• (a) the Framework Agreement;

• (b) the “Letter from the Independent Board Committee” as set out in this circular; and

• (c) the “Letter from Access Capital” as set out in this Circular.

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