Long Investment Corp — Proxy Solicitation & Information Statement 2008

May 12, 2008

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Shui On Construction and Materials Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or transferee(s) or to the bank, licensed securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

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)

CONNECTED AND DISCLOSEABLE TRANSACTION

FURTHER FUNDING OR FINANCIAL ASSISTANCE TO THE JOINT VENTURE FOR THE DEVELOPMENT OF DALIAN TIANDI ● SOFTWARE HUB

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

ANGLO CHINESE CORPORATE FINANCE, LIMITED

A letter from the Independent Board Committee is set out on page 12 of this circular.

A letter from Anglo Chinese, the Independent Financial Adviser, containing its advice to the Independent Board Committee and the Independent Shareholders, is set out on pages 13 to 21 of this circular.

A notice convening the SGM to be held at Room 103, 1st Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong on Thursday, 29 May 2008 at 3:15 p.m. (or so soon thereafter as the annual general meeting of the Company convened at the same place and date at 3:00 p.m. shall have concluded or adjourned) is set out on pages 32 and 33 of this circular. Whether or not you are able to attend the meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same 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 later than 48 hours before the time appointed 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

13 May 2008

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Letter of advice from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Appendix — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	22
Notice of Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	32

— i —

DEFINITIONS

In this circular, the following expressions have the meanings respectively set opposite them unless the context otherwise requires:

• “ Anglo Chinese ” or “ Independent Financial Adviser ”

Anglo Chinese Corporate Finance, Limited, the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Second Further Injection, and 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;

• “ associate(s) ”, “ connected person(s) ”, “ substantial shareholder(s) ”,

each has the meaning ascribed to it in the Listing Rules;

• “ subsidiary(ies) ”

• “ Board ”

the board of Directors;

• “ Company ”

Shui On Construction and Materials Limited, a company incorporated in Bermuda whose securities are listed on the main board of the Stock Exchange (stock code: 983);

• “ Dalian Group ”

Dalian Offshore JV and its subsidiaries, including the PRC JV Companies and the PRC Project Companies;

• “ Dalian Offshore Group ”

• Dalian Offshore JV and its non-PRC subsidiaries including the SPV;

• “ Dalian Offshore JV ”

• “ Dalian Project ”

Richcoast Group Limited, a company incorporated in the British Virgin Islands and the joint venture company established under the shareholders agreement dated 25 May 2007 made between Innovate Zone, Main Zone and Many Gain; the development and operation of the Dalian Tiandi ● Software Hub (previously known as Dalian Software Park Phase II), the details of which are set out in the Previous Joint Announcements;

• “ Directors ” directors of the Company;

• “ First Further Injection ”

• the further cash injection to the PRC Project Companies in the aggregate amount equivalent to approximately RMB910 million as jointly announced by SOL and the Company on 16 January 2008;

• “ Group ” the Company and its subsidiaries;

• “ HK$ ”

Hong Kong dollars, the lawful currency of Hong Kong;

— 1 —

DEFINITIONS

• “ Hong Kong ”

• “ Independent Board Committee ”

• the Hong Kong Special Administrative Region of the PRC; the committee of the Board comprising Mr. Anthony Griffiths, Mr. Cheng Mo Chi, Moses and Mr. Gerrit de Nys, all being independent non-executive Directors, formed to advise the Independent Shareholders on whether the terms and conditions of the Second Further Injection are fair and reasonable;

• “ Independent Shareholders ”

• shareholders of the Company other than Mr. Lo and his associates;

• “ Innovate Zone ”

• Innovate Zone Group Limited, a wholly-owned subsidiary of SOL and a company incorporated in the British Virgin Islands;

• “ Joint Venture Agreement ” the shareholders agreement dated 25 May 2007 and entered into between Innovate Zone, Main Zone, Many Gain and Dalian Offshore JV in relation to the establishment of Dalian Offshore JV as joint venture company, which has been supplemented and amended by the first supplemental shareholders agreement dated 29 August 2007;

• “ Land ”

• the land area constituting Dalian Tiandi ● Software Hub, the details of which are set out in the Previous Joint Announcements;

• “ Latest Practicable Date ” 8 May 2008, being the latest practicable date prior to the printing of this circular for ascertaining certain information herein;

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

• “ Main Zone ” Main Zone Group Limited, a wholly-owned subsidiary of the Company and a company incorporated in the British Virgin Islands;

• “ Many Gain ” Many Gain International Limited, a member of the Yida Group and a company incorporated in the British Virgin Islands;

• “ Mr. Lo ” Mr. Lo Hong Sui, Vincent;

• “ Offshore Further Injection ” the offshore funding or financial assistance to the Dalian Offshore Group in an aggregate amount up to the equivalent of RMB1,833 million for the development of the Dalian Project pursuant to the Offshore Supplemental Agreement;

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DEFINITIONS

• “ Offshore Supplemental Agreement ”

the second supplemental agreement dated 28 April 2008 and entered into between Innovate Zone, Main Zone, Many Gain and Dalian Offshore JV to supplement and amend the Joint Venture Agreement;

• “ Onshore Further Injection ”

the onshore funding or financial assistance to the PRC JV Companies in an aggregate amount up to RMB2,350 million;

• “ Onshore Shareholders Memorandum ”

• the memorandum dated 28 April 2008 and entered into between SPV and Yida in relation to the additional funding requirements for the PRC JV Companies;

• “ PRC ”

• the People’s Republic of China, and for the purpose of this circular, excluding Hong Kong and the Macau Special Administrative Region;

• “ PRC JV Companies ”

• joint venture companies owned as to 78% by the Dalian Offshore Group and 22% by the Yida Group, and which are the holding companies of the PRC Project Companies;

• “ PRC Project Companies ”

• companies established by the PRC JV Companies as wholly-owned subsidiaries to hold the Dalian Project;

• “ Previous Joint Announcements ”

• the joint announcements of the Company and SOL dated 25 May 2007 and 16 January 2008 in respect of the formation of the joint venture for the development of the Dalian Project and the First Further Injection;

• “ Resolution ” the ordinary resolution to be proposed at the SGM as set out in the Notice of Special General Meeting which is set out at the end of this circular;

• “ RMB ”

Renminbi, the lawful currency of the PRC;

• “ Second Further Injection ” collectively the Offshore Further Injection and the Onshore Further Injection;

• “ SFO ” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong);

• “ SGM ” the special general meeting to be convened by the Company to consider, among other things, the Second Further Injection;

• “ Shareholders ” holders of the shares of the Company;

• “ SOL ” Shui On Land Limited, a company incorporated in the Cayman Islands whose securities are listed on the Stock Exchange (stock code: 272);

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	DEFINITIONS
“SOL Group”	SOL and its subsidiaries;
“SPV”	4 companies incorporated in Hong Kong and established by
	the Dalian Offshore JV as wholly-owned subsidiaries to form
	part of the Dalian Offshore Group;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited;
“Yida”	Yida Group Company Limited, a limited liability company
	incorporated in the PRC;
“Yida Group”	Yida and its subsidiaries (including Many Gain and Dalian
	Software Park Development Company Limited); and
“%”	per cent.

Unless otherwise specified in this circular and for the purpose of illustration only, RMB is translated to HK$ at the rate of HK$1.00 = RMB0.90. No representation is made that any amount in RMB has been or could be converted at the above rate or at any other rates or at all.

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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 ) Ms. Lau Jeny (Chief Financial Officer ) Mrs. Lowe Hoh Wai Wan, Vivien

Non-executive Director: Professor Michael Enright

Independent Non-executive Directors: Mr. Anthony Griffiths Mr. Cheng Mo Chi, Moses Mr. Gerrit de Nys

Registered Office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Head Office and Principal Place of Business in Hong Kong: 34th Floor Shui On Centre 6-8 Harbour Road Hong Kong

13 May 2008

To the Shareholders

Dear Sir or Madam,

CONNECTED AND DISCLOSEABLE TRANSACTION

FURTHER FUNDING OR FINANCIAL ASSISTANCE TO THE JOINT VENTURE FOR THE DEVELOPMENT OF DALIAN TIANDI ● SOFTWARE HUB

INTRODUCTION

References are made to the Previous Joint Announcements in respect of the connected and discloseable transaction involving the formation of the joint venture constituting the Dalian Group, and the First Further Injection for the development of the Dalian Project. The Dalian Group comprises (1) the Dalian Offshore JV, a company held as to 61.54%, 28.20% and 10.26% of its issued share capital by Innovate Zone (a wholly-owned subsidiary of SOL), Main Zone (a wholly-owned subsidiary of the Company) and Many Gain (a member of the Yida Group) respectively, and its non-PRC subsidiaries including the SPV; (2) the PRC JV Companies, companies held as to 78% and 22% of their equity interest by the Dalian Offshore Group and the Yida Group respectively, and (3) the PRC Project Companies, wholly-owned subsidiaries of the PRC JV Companies.

• for identification purpose only

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LETTER FROM THE BOARD

The Board has announced on 28 April 2008 that Innovate Zone, Main Zone, Many Gain and Dalian Offshore JV entered into the Offshore Supplemental Agreement pursuant to which Innovate Zone, Main Zone and Many Gain had agreed to, subject to obtaining the approval by the Independent Shareholders at the SGM and the approval by the independent shareholders of SOL, provide further funding to the Dalian Offshore Group or financial assistance to the Dalian Group in an aggregate amount up to the equivalent of RMB1,833 million (approximately HK$2,037 million) for the development of the Dalian Project (the “ Offshore Further Injection ”).

On 28 April 2008, the shareholders of the PRC JV Companies entered into the Onshore Shareholders Memorandum pursuant to which the Dalian Offshore Group and the Yida Group had agreed to provide funding or financial assistance to the PRC JV Companies in an aggregate amount up to RMB2,350 million (approximately HK$2,611 million) (the “ Onshore Further Injection ”, together with the Offshore Further Injection, the “ Second Further Injection ”).

The purpose of this circular is to provide you with further information about the Second Further Injection to enable you to make an informed decision on whether to vote for or against the proposed resolution at the SGM.

SECOND FURTHER INJECTION

Offshore Supplemental Agreement

Date: 28 April 2008

Parties:

• (1) Innovate Zone;

• (2) Main Zone;

• (3) Many Gain; and

• (4) Dalian Offshore JV.

Subject:

The parties have agreed to supplement and amend the Joint Venture Agreement whereby the parties will, subject to obtaining the Independent Shareholders’ approval and the independent shareholders’ approval of SOL, provide further funding to the Dalian Offshore Group or financial assistance to the Dalian Group in an aggregate amount up to the equivalent of RMB1,833 million (approximately HK$2,037 million) for the development of the Dalian Project (the “ Offshore Further Injection ”). Such additional funding would be provided in proportion to their respective interests in the Dalian Offshore JV, i.e. 61.54% by Innovate Zone, 28.20% by Main Zone and 10.26% by Many Gain, while the financial assistance (which may be provided onshore) would be provided in proportion to their respective attributable interests in the Dalian Group, i.e. effectively 48% by Innovate Zone, 22% by Main Zone and 30% by the Yida Group.

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LETTER FROM THE BOARD

According to the unaudited consolidated financial statements of Dalian Offshore JV for the financial period ended 31 December 2007, the consolidated net profit before and after taxation of Dalian Offshore JV and its subsidiaries for such period was approximately RMB40.9 million, and the consolidated net asset value of Dalian Offshore JV and its subsidiaries at 31 December 2007 was approximately RMB40.9 million.

Onshore Shareholders Memorandum

Date: 28 April 2008

Parties:

• (1) SPV, all being indirect wholly-owned subsidiaries of Dalian Offshore JV; and

• (2) Yida.

Subject:

The Dalian Offshore Group and the Yida Group will provide funding or financial assistance to the PRC JV Companies in an aggregate amount up to RMB2,350 million (approximately HK$2,611 million) in proportion to their respective interests in the PRC JV Companies, i.e. 78% by the Dalian Offshore Group (up to the equivalent sum of RMB1,833 million) and 22% by the Yida Group (up to the equivalent sum of RMB517 million) (the “ Onshore Further Injection ”, together with the Offshore Further Injection, the “ Second Further Injection ”). The amount of the Second Further Injection was determined based on the estimated land costs and the funding requirements for the operations of the Dalian Group.

The funding or financial assistance required from the Dalian Offshore Group under the Onshore Shareholders Memorandum will be satisfied by the funding or financial assistance provided under the Offshore Supplemental Agreement. As a result, the funding or financial assistance required under the Second Further Injection will be satisfied by SOL, the Company and the Yida Group in proportion to their respective attributable interests in the Dalian Group, i.e. effectively 48% by SOL, 22% by the Company and 30% by the Yida Group, and their respective interests in the Dalian Group will remain unchanged after the Second Further Injection.

The cash contributions, if any, from Innovate Zone and Main Zone for the Second Further Injection will be financed by SOL and the Company respectively from their respective internal resources and banking facilities.

REASONS FOR THE SECOND FURTHER INJECTION

Based on further assessment of the Dalian Project, the more stringent controls on land acquisition in the PRC, the latest policies imposed by the government of the PRC on the property developers such as more capital funding ratio in the early stage of a property project, and the overall market conditions for the PRC property sector, SOL, the Company and the Yida Group have jointly

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LETTER FROM THE BOARD

agreed to further accelerate and complete the Land acquisitions for the Dalian Project. As such, funding plans are revised to enable more Land acquisitions at this stage rather than acquisitions over time. The Second Further Injection will strengthen the funding capability and cash flow of the PRC Project Companies to achieve such acquisitions.

The Directors (including the independent non-executive Directors) consider that the terms of the Second Further Injection are fair and reasonable, on normal commercial terms, are necessary under the new policy measures implemented by the government of the PRC, and consequently that the Second Further Injection is in the best interests of the Group and the Shareholders as a whole.

Upon completion of the Second Further Injection, the Group’s interests in the Dalian Group will remain unchanged, and the Group will continue to treat Dalian Offshore JV as an associated company. The Group’s interests in associates will increase by approximately HK$574 million and the Group’s current liabilities will increase by the same amount. It is not expected that the Second Further Injection will have any immediate impact on the existing earnings of the Group, but is expected to have positive impact on the future earnings of the Group which however could not be quantified at this stage.

IMPLICATIONS OF THE LISTING RULES

The formation of the joint venture relating to the Dalian Group constituted a connected and discloseable transaction for the Company and has been approved by the Independent Shareholders on 20 June 2007. The applicable percentage ratios for the Second Further Injection as defined in Rule 14A.10 of the Listing Rules, whether on its own or in aggregate with the prior funding and capital injections into the Dalian Group in the preceding 12 months, are more than 2.5% but less than 25% for the Company. Accordingly, the Second Further Injection constitutes a connected and discloseable transaction for the Company and is subject to the reporting, announcement and independent shareholders’ approval requirements of Chapter 14A and Chapter 14 of the Listing Rules.

At the SGM, the Company will seek Independent Shareholders’ approval for the Second Further Injection. The votes to be taken at the SGM will be taken by poll, the results of which will be announced after the SGM.

An Independent Board Committee has been established to advise the Independent Shareholders in respect of the Second Further Injection and Anglo Chinese has been retained as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard. Shareholders should consider carefully the recommendations of the Independent Board Committee and the factors, reasons and recommendations in relation to the Second Further Injection.

GENERAL INFORMATION

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

— 8 —

LETTER FROM THE BOARD

SOL through its subsidiaries and associates is one of the leading property developers in the PRC. The SOL Group engages principally in the development, sale, leasing, management and long-term ownership of high-quality residential, office, retail, entertainment and cultural properties in the PRC.

The Yida Group is a conglomerate with interests in property development, construction and furnishing, equipment manufacturing, software park development, platform development for software and information services, and professional training and education. Other than being a joint venture partner for the Dalian Project and being a shareholder of China Central Properties Limited (an associate of the Group), to the best knowledge and belief of the Directors having made all reasonable enquiry, the Yida Group has no other relationship with the Company.

SPECIAL GENERAL MEETING

A notice convening the SGM to be held at Room 103, 1st Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong on Thursday, 29 May 2008 at 3:15 p.m. (or so soon thereafter as the annual general meeting of the Company convened at the same place and date at 3:00 p.m. shall have concluded or adjourned) is set out on pages 32 and 33 of this circular. At the SGM, the Resolution will be proposed to approve the Second Further Injection.

Any connected person with a material interest in the transactions contemplated under the Second Further Injection, and any other Shareholders and their respective associates with a material interest in the transactions contemplated under the Second Further Injection, shall abstain from voting in respect of the Resolution.

Mr. Lo is the chairman of the Company and has an interest in 56.56% of the issued share capital of the Company at the Latest Practicable Date. He is also the chairman of SOL in which he has an interest in 54.15% of its issued share capital. Accordingly, Mr. Lo is a connected person of the Company, and SOL and Innovate Zone are associates of a connected person of the Company. Mr. Lo and his associates will abstain from voting in respect of the Resolution.

A proxy form for use at the SGM is enclosed. Whether or not you are able to attend the SGM, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same 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 later than 48 hours before the time appointed 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 prevent you from attending and voting in person at the SGM and any adjourned meeting (as the case may be) if you so wish.

In accordance with Rule 13.39(4) of the Listing Rules, the chairman of the SGM will demand a poll in relation to the Resolution to approve the connected transaction relating to the Second Further Injection. The results of the voting will be announced after the SGM.

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LETTER FROM THE BOARD

PROCEDURES 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

• (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 its duly authorised representative shall be deemed to be the same as a demand by a member.

RECOMMENDATION

The Directors (including the independent non-executive Directors) take the view that the transaction contemplated under the Second Further Injection is on normal commercial terms and in the ordinary and usual course of business of the Company; and that the terms and conditions of the Second Further Injection are fair and reasonable and in the interests of the Company and the Shareholders as a whole. The Directors recommend the Independent Shareholders to vote in favour of the Resolution to be proposed at the SGM.

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LETTER FROM THE BOARD

ADDITIONAL INFORMATION

Your attention is drawn to the letter from the Independent Board Committee to the Independent Shareholders set out on page 12 of this circular, to the letter from Anglo Chinese, the Independent Financial Adviser to the Company’s Independent Board Committee and Independent Shareholders in respect of the Second Further Injection set out on pages 13 to 21 of this circular, and to the information set out in the Appendix to this circular.

Yours faithfully For and on behalf of

Shui On Construction and Materials Limited Wong Yuet Leung, Frankie Chief Executive Officer

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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(Incorporated in Bermuda with limited liability)

(Stock Code: 983)

13 May 2008

To the Independent Shareholder(s)

Dear Sir or Madam,

CONNECTED AND DISCLOSEABLE TRANSACTION

FURTHER FUNDING OR FINANCIAL ASSISTANCE TO THE JOINT VENTURE FOR THE DEVELOPMENT OF DALIAN TIANDI ● SOFTWARE HUB

We refer to the circular (the “ Circular ”) dated 13 May 2008 issued by the Company to its Shareholders of which this letter forms part. Terms defined in the Circular shall have the same meanings when used in this letter, unless the context otherwise requires.

The Independent Board Committee has been formed to advise the Independent Shareholders as to whether, in its opinion, the terms of the transactions contemplated under the Second Further Injection are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Anglo Chinese has been appointed to advise the Independent Board Committee and the Independent Shareholders in respect of the transactions contemplated under the Second Further Injection.

We wish to draw your attention to the letter from the Board, as set out on pages 5 to 11 of the Circular, and the text of a letter of advice from Anglo Chinese, as set out on pages 13 to 21 of the Circular, both of which provide details of the Second Further Injection.

Having considered the terms of the Second Further Injection, the advice of Anglo Chinese and the relevant information contained in the letter from the Board, we are of the opinion that the terms of the Second Further Injection are fair and reasonable so far as the Independent Shareholders are concerned and that the Second Further Injection is in the interests of the Company and the Shareholders as a whole.

Accordingly, we recommend the Independent Shareholders to vote in favour of the Resolution to be proposed at the SGM.

Yours faithfully,

Independent Board Committee of Shui On Construction and Materials Limited

Anthony Griffiths Cheng Mo Chi, Moses Gerrit de Nys Independent Independent Independent Non-executive Director Non-executive Director Non-executive Director

* for identification purpose only

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LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the text of the letter from Anglo Chinese to the Independent Board Committee and the Independent Shareholders prepared for the purpose of inclusion in this circular.

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The Independent Board Committee and Independent Shareholders Shui On Construction and Materials Limited 34/F., Shui On Centre 6-8 Harbour Road Hong Kong

13th May, 2008

Dear Sirs,

FURTHER FUNDING OR FINANCIAL ASSISTANCE TO THE JOINT VENTURE FOR THE DEVELOPMENT OF DALIAN TIANDI ● SOFTWARE HUB (FORMERLY KNOWN AS DALIAN SOFTWARE PARK PHASE II)

INTRODUCTION

We refer to our appointment as the independent financial adviser to the Independent Board Committee and Independent Shareholders in relation to the Second Further Injection for the development of the Dalian Project. Details of the Second Further Injection are contained in the circular from the Company dated 13th May, 2008 (the “Circular”) of which this letter forms a part. Expressions used in this letter have the same meanings as defined in the Circular unless the context requires otherwise.

The Second Further Injection gives rise to a connected and discloseable transaction for the Company under Chapters 14 and 14A of the Listing Rules and is therefore subject to the reporting and announcement requirements set out therein and requires approval of Independent Shareholders and Independent SOL Shareholders in the prescribed manner.

On 4th June, 2007, we gave an opinion on the terms of the joint venture constituting the Dalian Group which gave rise to a connected and discloseable transaction for the Company. The formation of the joint venture was approved by Independent Shareholders and Independent SOL Shareholders separately on 20th June, 2007.

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LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

The connected and discloseable transaction for the Company relating to the Second Further Injection arises because Mr. Lo is the Chairman of the Company in which he has a 56.5 per cent shareholding. He is also the Chairman of SOL in which he has a 54.1 per cent shareholding. The Company and SOL, through their investment vehicles, are substantial and major shareholders respectively of the joint venture for the development of the Dalian Project. Accordingly, SOL and Innovate Zone, which is SOL’s investment vehicle for the joint venture, are associates of a connected person of the Company. The Second Further Injection constitutes a discloseable transaction for the Company since the Company’s share of the Second Further Injection is HK$574 million and under Rule 14A.10 of the Listing Rules, the total assets test and consideration test percentages are 4.39 per cent and 10.18 per cent respectively. Taking together with the prior funding and capital injections by the Company in the preceding twelve months, the total assets test and consideration test percentages will be 10.80 per cent and 24.74 per cent respectively, less than 25 per cent applicable ratio for a major transaction.

The Independent Board Committee comprising all of the Company’s independent non-executive directors namely, Mr. Anthony Griffiths, Mr. Cheng Mo Chi, Moses and Mr. Gerrit de Nys has been formed to consider whether the Second Further Injection is on normal commercial terms, in the ordinary and usual course of business and is fair and reasonable and in the interests of the Company and its Shareholders as a whole. We have been appointed to advise the Independent Board Committee and Independent Shareholders in respect of these matters.

In formulating our opinion and recommendation, we have relied on the information and facts supplied to us by the Company and the opinions expressed by the Directors. We have reviewed the Offshore Supplemental Agreement, the Onshore Shareholders Memorandum, the published information of the Company and SOL, including their recent announcements available on the website of the Stock Exchange and the annual financial statements and interim reports of the Company, and related funding requirements of the Company and the Dalian Project.

We have assumed that the information and representations contained or referred to in the Circular were true and accurate at the time they were made and continued to be so at the date of the despatch of the Circular. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors. We have also been advised by the Directors that and believe that no material facts have been omitted from the Circular. We have not conducted an independent investigation into the affairs of the Company or verified any of the information that we have considered or that has been provided to us.

We consider we have reviewed sufficient information to reach an informed view to justify reliance on the accuracy of the information contained in the Circular and to provide a reasonable basis for our recommendation.

— 14 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

Apart from normal professional fees for our services to the Company in connection with this appointment and three other prior engagements on 16th May, 2007, 9th July, 2007 and 3rd March, 2008 where Anglo Chinese was appointed to advise the Independent Board Committee and Independent Shareholders in relation to the formation of a joint venture for the development of Dalian Project and two sales of SOL shares to a company beneficially owned by Mr. Lo, no other arrangement exists whereby Anglo Chinese will receive any benefits from the Company or any of its associates.

PRINCIPAL FACTORS

We have set out below the principal factors that we have taken into account in arriving at our advice to the Independent Board Committee and Independent Shareholders.

Background

In May, 2007, the Company, SOL and the Yida Group, a prominent developer in Northern China, agreed to form a joint venture for the development and operation of the “Dalian Project” in Dalian, the PRC. This project is held by the Dalian Group that comprises:

• (a) Dalian Offshore JV that is held as to 61.54 per cent of its issued share capital by Innovate Zone, the investment vehicle of SOL, 28.20 per cent by Main Zone, the Company’s investment vehicle and 10.26 per cent by Many Gain, the investment vehicle of the Yida Group;

• (b) four PRC JV Companies, each of which is held as to 78 per cent by the Dalian Offshore Group and 22 per cent by the Yida Group;

• (c) two PRC Project Companies, each of which is wholly owned by two PRC JV Companies, which together undertake the Dalian Project; and

• (d) as a result, SOL, the Company and the Yida Group will have effective shareholding interests in the Dalian Project in the ratio of 48 per cent, 22 per cent and 30 per cent respectively.

The Dalian Project is a large scale integrated development project that occupies approximately 3.6 million square metres of gross floor area and comprises software development centres, commercial and residential properties, educational and research facilities and outdoor recreational and other public amenities. It consists of the Land, a major portion of which has had substantial clearance work carried out on it and the remainder will require further preparation work and the relocation of occupants. According to the current development plan, the Dalian Project will be developed in a number of phases over an eight to nine year period.

— 15 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

After obtaining approval from Independent Shareholders in June, 2007 and pursuant to the Joint Venture Agreement, the Company invested approximately HK$508 million in shareholders’ loans through its wholly owned investment vehicle, Main Zone in return for a 22 per cent effective equity interest in the Dalian Group.

In order to meet the further funding needs of the Dalian Project, SOL, the Company and the Yida Group agreed on 15th January, 2008 to provide further funding in an aggregate amount of RMB910 million (approximately HK$995 million) to Dalian Group in proportion to their effective shareholdings, which are in the ratio of 48/22/30 per cent, respectively. As part of the First Further Injection for the Dalian Project, the Company invested approximately RMB200 million (approximately HK$219 million) in shareholders’ loans through Main Zone. These shareholders’ loans were unsecured, repayable on demand and bear interest at a rate of five per cent per annum. The First Further Injection was made as a result of an increase in property and land prices in Dalian, coupled with new policies of the PRC Government which had the effect of increasing capital requirements for property developers in the early stage of a property project. The new funds were applied to acquire the necessary plots of the Land and strengthen the capital base for the Dalian Project in its initial stage of development.

By March, 2008, Dalian Group secured the acquisition of approximately 1.6 million square metres of gross floor area of the Dalian Project, representing approximately 47 per cent of the total gross floor area that can be built on the Land. It is intended that the PRC Project Companies will acquire more land by way of competitive bidding.

Based on its assessment of the Dalian Project and taking into account the increase in property and land prices in Dalian and the new policies of the PRC Government referred to above, the Company agreed with SOL and the Yida Group to make the Second Further Injection to expedite acquisition of part of the Land.

Recent developments of the Dalian Tiandi ● Software Hub

1. Property prices

In general, the real estate market in Dalian was promising in 2007. As indicated by the Dalian Municipal Bureau of Statistics, sales of residential property amounted to RMB46.1 billion, an increase of 62.1 per cent over 2006 while the vacancy rate decreased by approximately 20.5 per cent to 1.94 million square metres. According to research published in April by CB Richard Ellis, in the first quarter of 2008, rentals in the prime office market, the luxury residential market, the prime retail market and the industrial market in Dalian all continued to rise steadily.

— 16 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

The diagrams below show the historical price index of four different segments of the Dalian property market since 2003.

==> picture [379 x 10] intentionally omitted <==

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

Dalian Prime Office Market Dalian Luxury Residential Market
----- End of picture text -----

==> picture [205 x 139] intentionally omitted <==

==> picture [205 x 140] intentionally omitted <==

==> picture [356 x 8] intentionally omitted <==

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

Dalian Prime Retail Market Dalian Industrial Market
----- End of picture text -----

==> picture [205 x 139] intentionally omitted <==

==> picture [205 x 140] intentionally omitted <==

Source: CB Richard Ellis

2. PRC Government policies and regulations

Since the formation of the Dalian Group in June, 2007, there have been new policies and regulations promulgated by the PRC Government that may directly affect the land acquisition and development costs of the Dalian Project. Two important policies and regulations are set out below.

1. Notice of the People’s Bank of China and China Banking Regulatory Commission on Strengthening the Administration of Commercial Real Estate Credit Loans ( 關於加強商業性房 地產信貸管理的通知 ) (promulgated on 27th September, 2007 by the People’s Bank of China)

This notice stipulates that a commercial bank in the PRC shall not make a loan in any form for a real estate development before the full payment of 35 per cent of the relevant project investment and before the “land use certificate” has been issued. In addition, a property developer is required to

— 17 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

inform the lending bank of the particulars of the intended use of a loan and must adhere to them during the term of the loan. Further, proceeds from a loan made by a commercial bank in the PRC shall only be used there and shall not be used in a “cross-border” way. This notice limits the flexibility of the Dalian Group in allocating and using existing banking facilities.

1. Provisions on the Assignment of State-owned Construction Land Use Rights through Bid Invitation, Auction and Quotation ( 招標拍賣掛牌出讓國有建設用地使用權規定 ) (promulgated on 28th September, 2007 by the Ministry of Land and Resources)

The provisions on the Assignment of State owned Construction Land Use Rights through Bid Invitation, Auction and Quotation state that with respect to land for industry, commerce, tourism, entertainment, commercial housing or other business operations or on which there are two or more intended land users, the assignment or sale shall be conducted through inviting bids, auction or land exchange but not through private sale. The effect of these regulations is that the Dalian Group will need to acquire the Land through competitive bidding which may potentially raise the cost of land when there are other competitive bids.

As a result of these new policies and regulations issued by the PRC Government, it is expected that the remaining plots of the Land will be acquired by way of competitive bidding. These new policy measures and regulations also require property developers in the PRC to invest more capital as a percentage of the value of the land that they bid for than was previously the case. Measures recently implemented by the PRC Government to cool down the property market in the PRC have also reduced the availability of domestic funds for property development projects in the PRC. These factors, together with higher property prices in Dalian, result in a much higher need for funding for the Dalian Project from its shareholders at an earlier stage of the project than was previously the case. However, the Directors believe that the provision of further funds for the Dalian Project now will in fact have the effect of reducing the overall cost of the project by acquiring most of the Land at prices which are likely to be lower than those in the future.

Reasons for and intended use of the Second Further Injection

The principal reason for the Second Further Injection is to accelerate the acquisition of a major portion of the remaining part of the Land for the Dalian Project because of the events and their effects as set out above.

It is intended that the Second Further Injection will enable the PRC Project Companies to acquire further plots of the Land to provide approximately 1.2 million square metres of gross floor area in the Dalian Project. This additional land, together with the land previously acquired for the Dalian Project, represents approximately 80 percent of the Land in terms of gross floor area.

The amount of the Second Further Injection is determined based on the estimated aggregate value of the land to be acquired and the capital contribution required by the PRC Project Companies under the new policy measures and regulations. It is expected that additional land will be acquired by way of competitive bidding within 9 months following approvals from Independent Shareholders and Independent SOL Shareholders.

— 18 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

Based on the cashflow projections and revised funding plans for the Dalian Project, the Directors do not expect that further funding or financial assistance to the Dalian Group will be needed in the near future following the Second Further Injection. The latest cashflow projections suggest that the revised funding plans for the Dalian Project will not have a material impact on the returns of the Dalian Project. In particular, it is intended that the remaining part of the Land will be acquired at a later stage and financed by internally generated funds and, or, bank borrowings.

PRINCIPAL TERMS OF THE SECOND FURTHER INJECTION

Set out below are the principal terms of the agreements underlying the Second Further Injection which comprises the Offshore Further Injection and the Onshore Further Injection.

1. Offshore Supplemental Agreement

The Offshore Supplemental Agreement is the second supplemental agreement entered into on 28th April, 2008 between Innovate Zone, Main Zone, Many Gain and Dalian Offshore JV to supplement and amend the Joint Venture Agreement dated 25th May, 2007. Under the Offshore Supplemental Agreement, Innovate Zone, Main Zone and Many Gain agreed to provide further funding to the Dalian Offshore JV or financial assistance to Dalian Group in an aggregate amount up to the equivalent of RMB1,833 million (or approximately HK$2,037 million) for the development of the Dalian Project. This money would be contributed by SOL, the Company and the Yida Group in proportion to their respective shareholdings in Dalian Offshore JV, in the ratio of 61.54/28.20/10.26 per cent, while the financial assistance that may be provided onshore would be provided in proportion to their attributable interests in the Dalian Group which is effectively in the ratio of 48/22/30 per cent respectively. Thereafter, any further additional funding necessary for the Dalian Group will be agreed by SOL, the Company and the Yida Group as shareholders of Dalian Offshore JV.

2. Onshore Shareholders Memorandum

The Onshore Further Injection is governed by the Onshore Shareholders Memorandum, which provides that the Dalian Offshore Group and the Yida Group will provide to the PRC JV Companies funding or financial assistance in an aggregate amount of up to RMB2,350 million (or approximately HK$2,611 million) rateably to their shareholdings, which is 78% by the Dalian Offshore Group and 22% by the Yida Group. This funding or financial assistance required from the Dalian Offshore Group under the Onshore Shareholders Memorandum will be satisfied by funding or financial assistance in accordance with the Offshore Supplemental Agreement described above.

We consider the financing arrangements set out in the Offshore Supplemental Agreement and Onshore Shareholders Memorandum to be on normal commercial terms, and to be fair and reasonable and in the interests of the Company and Independent Shareholders as a whole.

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LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

FINANCIAL EFFECTS ON THE COMPANY

1. Net assets

As at 31st December, 2007, the audited net asset value of the Group amounted to approximately HK$7,295 million. Pursuant to the Second Further Injection, the Company will invest approximately RMB517 million (or approximately HK$574 million) in the Dalian Group. The Second Further Injection will be used for acquiring land and strengthening the capital base of PRC JV Companies. As each of SOL, the Company and the Yida Group will make the Second Further Injection rateably to their shareholdings in the Dalian Group, their respective shareholdings in percentage terms in the Dalian Group will remain unchanged. Given this, we believe that the net asset value of the Group, after accounting for the Dalian Offshore JV as an associated company, should not be adversely affected as a result of the proposed funding. However, the Dalian Project has the potential to make a significant contribution in the future if it is successfully developed.

2. Earnings

According to the 2007 annual report of the Group, net profit after taxation attributable to Shareholders was approximately HK$702.0 million.

As mentioned above, the Dalian Project is expected to be completed in phases over a 8-9 year period. Since the Dalian Project is a greenfield project and has yet to commence development and construction work, the future effect on earnings for the Group cannot be determined at this stage.

3. Source of funds

It is expected that the Second Further Injection will be funded by the Group’s internal resources and external bank borrowings.

4. Gearing

Based on the audited financial statements of the Group as at 31st December, 2007, the gearing ratio of the Group stood at approximately 54 per cent, down from 68 per cent as at 31st December, 2006. Upon completion of the Second Further Injection, the Group will incur a net cash outflow of approximately HK$574 million.

Assuming that this investment is funded internally or from the proceeds from the disposal of SOL shares in April, 2008, the gearing ratio of the Group should not increase.

— 20 —

LETTER OF ADVICE FROM THE INDEPENDENT FINANCIAL ADVISER

RISK FACTORS

The successful development of the Dalian Project as a whole as it is currently envisaged depends on the successful acquisition of the Land and approval of the Second Further Injection by Independent Shareholders and Independent SOL Shareholders.

Other than the plots of Land that have been acquired so far, future acquisitions of the Land will be through competitive bidding and there is no assurance that the Dalian Onshore Group will be successful in bidding for all or any remaining plots of the Land.

Otherwise, the investment is subject to risk normal in investments of this type in the PRC, such as changes in Government policies or law and foreign exchange controls, all of which the Company have been evaluating and responding to successfully for many years.

RECOMMENDATION

Having considered the principal factors and reasons for the Second Further Injection which are set out above, we consider that the Second Further Injection is on normal commercial terms, in the ordinary and usual course of business and is fair and reasonable and in the interests of the Company and Independent Shareholders as a whole. Accordingly, we recommend that Independent Shareholders vote in favour of the resolution to be proposed at the SGM to approve the Second Further Injection and that Independent Board Committee advises the Independent Shareholders accordingly.

Yours faithfully, for and on behalf of

Anglo Chinese Corporate Finance, Limited Christopher J. Howe Managing Director

— 21 —

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 Issuers 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	Approximate
	**shares in **	the Company	percentage of
	Personal	Other	shareholding in
Name of Director	interests	interests	the Company
Lo Hong Sui, Vincent	—	181,981,000	56.56%
		(Note)
Choi Yuk Keung, Lawrence	1,100,000	—	0.34%
Wong Yuet Leung, Frankie	800,000	—	0.24%
Lowe Hoh Wai Wan, Vivien	720,000	—	0.22%

Note: Among 181,981,000 shares beneficially owned by Shui On Company Limited (“SOCL”), 166,148,000 shares and 15,833,000 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.

— 22 —

GENERAL INFORMATION

APPENDIX

(b) Short position in the shares of the Company

	**Number **	of ordinary	Approximate
	**shares in **	the Company	percentage of
	Personal	Other	shareholding in
Name of Director	interests	interests	the Company
Lo Hong Sui, Vincent	—	1,600,000	0.49%
		(Note)

Note: These shares represent the call option granted by SOCL on 27 August 2002 to Mr. Wong Yuet Leung, Frankie as part of the incentive reward to his services to the Company. Mr. Lo Hong Sui, Vincent, HSBC International Trustee Limited and Bosrich Holdings Inc. are deemed to have short position in these shares under the SFO.

(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	ordinary
		Subscription	which options	shares
		price per	outstanding	subject to
Name of Director	Date of grant	share	are exercisable	the options
		HK$
Choi Yuk Keung,	3-1-2007	16.78	3-1-2010 to	700,000
Lawrence			2-1-2017
	14-6-2007	20.96	14-12-2007 to	250,000
			13-6-2012
	7-5-2008	19.76	7-11-2008 to	250,000
			6-5-2013
	7-5-2008	19.76	7-5-2011 to	1,000,000
			6-5-2018
Wong Yuet Leung,	1-8-2006	14.00	1-2-2007 to	2,000,000
Frankie			31-7-2011
	3-1-2007	16.78	3-1-2010 to	1,500,000
			2-1-2017
	14-6-2007	20.96	14-12-2007 to	500,000
			13-6-2012

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GENERAL INFORMATION

APPENDIX

				Number of
			Period during	ordinary
		Subscription	which options	shares
		price per	outstanding	subject to
Name of Director	Date of grant	share	are exercisable	the options
		HK$
	7-5-2008	19.76	7-11-2008 to	500,000
			6-5-2013
	7-5-2008	19.76	7-5-2011 to	2,000,000
			6-5-2018
Lowe Hoh Wai Wan,	1-8-2006	14.00	1-2-2007 to	120,000
Vivien			31-7-2011
	3-1-2007	16.78	3-1-2010 to	625,000
			2-1-2017
	14-6-2007	20.96	14-12-2007 to	176,000
			13-6-2012
	7-5-2008	19.76	7-11-2008 to	200,000
			6-5-2013
	7-5-2008	19.76	7-5-2011 to	750,000
			6-5-2018
Lau Jeny	7-5-2008	19.76	7-5-2011 to	1,000,000
			6-5-2018

(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 (b) above:

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

— 24 —

APPENDIX

GENERAL INFORMATION

• (e) Long position in the shares of SOL

	**Number **	of ordinary	Approximate
	shares in SOL		percentage of
	Personal	Other	shareholding
Name of Director	interests	interests	in SOL
Lo Hong Sui, Vincent	—	2,266,756,725	54.15%
		(Note)

Note: These shares are directly held by subsidiaries of SOCL, namely: Shui On Investment Company Limited, Shui On Properties 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.

• (f) Long position in the shares of China Central Properties Limited (“CCP”)

	Number of ordinary	Approximate
	Shares in CCP	percentage of
	Personal Other	shareholding
Name of Director	interests interests	in CCP
Anthony Griffiths	6,000 —	0.002%

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 been taken under such provisions of the SFO) or the Model Code for Securities Transactions by Directors of Listed Issuers or which were required to be entered in the register required to be kept under section 352 of the SFO.

At the Latest Practicable Date, 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.

Save as disclosed in the announcement of the Company dated 4 March 2008, at the Latest Practicable Date, none of the Directors has had any direct or indirect interest in any assets which have since 31 December 2007 (being the date to which the latest published audited consolidated financial statements of the Company were 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.

— 25 —

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:

			Number of
			ordinary	Approximate
			shares/	percentage of
	Class of		underlying	shareholding in
Name of Shareholders	shares	Capacity	shares held	the Company
John Zwaanstra	Ordinary	Interest of controlled	48,324,248 (L)	15.02%
		corporation	(Note 2)
Penta Investment	Ordinary	Investment manager	48,324,248 (L)	15.02%
Advisers Limited			(Note 2)
Mercurius GP LLC	Ordinary	Founder of	22,581,951 (L)	7.01%
		discretionary trust	(Note 2)
Todd Zwaanstra	Ordinary	Trustee	22,581,951 (L)	7.01%
			(Note 2)
Penta Asia Fund, Ltd.	Ordinary	Interest of controlled	22,581,951 (L)	7.01%
		corporation	(Note 2)
Cheah Cheng Hye	Ordinary	Founder of	25,554,000 (L)	7.94%
		discretionary trust
To Hau Yin	Ordinary	Interest of spouse	25,554,000 (L)	7.94%
Hang Seng Bank	Ordinary	Trustee	25,554,000 (L)	7.94%
Trustee International
Limited
Cheah Company	Ordinary	Interest of controlled	25,554,000 (L)	7.94%
Limited		corporation
Cheah Capital	Ordinary	Interest of controlled	25,554,000 (L)	7.94%
Management Limited		corporation
Value Partners Group	Ordinary	Interest of controlled	25,554,000 (L)	7.94%
Limited		corporation
Value Partners Limited	Ordinary	Investment manager	25,554,000 (L)	7.94%
Hung Kam Biu	Ordinary	Beneficial owner	16,543,072 (L)	5.14%
			(Note 3)

— 26 —

GENERAL INFORMATION

APPENDIX

			Number of
			ordinary	Approximate
			shares/	percentage of
	Class of		underlying	shareholding in
Name of Shareholders	shares	Capacity	shares held	the Company
Jocelyn Chu	Ordinary	Interest of controlled	16,543,072 (L)	5.14%
		corporation	(Note 3)
Winnington Capital	Ordinary	Investment manager	16,523,072 (L)	5.13%
Limited			(Note 3)
Trophy Asset	Ordinary	Investment manager	16,523,072 (L)	5.13%
Management Limited			(Note 3)

Notes:

1. “L” denotes a long position.

2. Among the interests owned by these shareholders, 5,560,000 shares are derivative interests.

3. Among the interests owned by these shareholders, 3,093,265 shares are derivative interests.

(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% 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:

Name of owner of shares		Effective
or equity interest (as		% equity
the case may be)	Name of subsidiary	interest held
廣州市番禺廣鋁實業有限公司	Panyu Dynamic Mark Steel and	20%
(Guangzhou Panyu Guanglu	Aluminium Engineering Co. Ltd.
Industrial Co., Ltd.)
Eversound Enterprise Limited	Panyu Dynamic Mark Steel and	16%
	Aluminium Engineering Co. Ltd.
Metro Materials Engineering	Lamma Concrete Products Limited	40%
Company Limited
Metro Materials Engineering	廣東南丫混凝土構件有限公司	40%
Company Limited

— 27 —

GENERAL INFORMATION

APPENDIX

Name of owner of shares		Effective
or equity interest (as		% equity
the case may be)	Name of subsidiary	interest held
廣州市番禺廣鋁實業有限公司	Panyu Rui Hui Metal Works Engineering	22.5%
(Guangzhou Panyu Guanglu	Co. Ltd.
Industrial Co., Ltd.)
Hip Kwan Engineering Company	Panyu Rui Hui Metal Works Engineering	22.5%
Limited	Co. Ltd.
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%#
上海建五實業有限公司	Shanghai Shui On Construction Co., Ltd.	15%
上海國際集團投資管理有限公司	Shanghai Shui On Construction Co., Ltd.	15%
江蘇昆山德普設備租賃有限公司	重慶騰輝德晟工程技術有限公司	20%
上海和晟機械成套設備有限公司	重慶騰輝德晟工程技術有限公司	20%
重慶市第二建築材料廠	Chongqing T.H. White Cement Co., Ltd.	40%
重慶建工集團有限責任公司	重慶騰建石材開發有限責任公司	45%
Hangshing Limited	Honour Link Development Limited	24%
Glory Prospect International	Honour Link Development Limited	24%
Company Limited
Shenzhen Yue Jie Concrete	Lamma Yue Jie Company Limited	40%
Products Co., Ltd.

• The 18% equity interest held by Ecomat (Hong Kong) Limited represents 18% of the issued ordinary shares and carries voting right of 11.25% of the total issued share capital comprising ordinary shares and special shares.

The 10% equity interest held by Win Media Limited represents 10% of the issued ordinary shares and carries voting right of 6.25% of the total issued share capital comprising ordinary shares and special shares.

— 28 —

GENERAL INFORMATION

APPENDIX

3. SERVICE CONTRACTS

At the Latest Practicable Date, none of the Directors had entered into any service contract with the Company other than contracts expiring or determinable by the Group within one year without payment of compensation (other than statutory compensation).

4. LITIGATION

At the Latest Practicable Date, the Group was not engaged in any litigation or arbitration of material importance and there was no litigation or claim of material importance known to the Directors to be pending or threatened by or against the Group.

5. COMPETING BUSINESS INTERESTS OF DIRECTORS

At the Latest Practicable Date, Mr. Lo Hong Sui, Vincent was the chairman and the controlling shareholder of SOL which is engaged in property development in the PRC.

Save as referred to herein, as at the Latest Practicable Date, none of the Directors or their respective associates had any interest in a business which competes or may compete with the business of the Group.

6. EXPERT AND CONSENT

The followings are the qualifications of the expert who has given opinion and advice, which is contained in this circular:

Name Qualification Anglo Chinese 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

Anglo Chinese has given and have not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which it appear.

7. EXPERT’S INTEREST IN ASSETS

At the Latest Practicable Date, Anglo Chinese:

• (a) does not have any shareholding, directly or indirectly, in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group; and

— 29 —

GENERAL INFORMATION

APPENDIX

• (b) 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 December 2007, the date to which the latest published audited consolidated financial statements of the Company were made up.

8. MATERIAL ADVERSE CHANGE

The Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2007, the date to which the latest published audited consolidated financial statements of the Company have been made up.

9. GENERAL

• (a) The qualified accountant of the Company is Ms. Lau Jeny, a member of The American Institute of Certified Public Accountants, the Hong Kong Institute of Certified Public Accountants and the Hong Kong Securities Institute.

• (b) The secretary of the Company is Ms. Tsang Yuet Kwai, an Associate of The Institute of Chartered Secretaries and Administrators and The Hong Kong Institute of Chartered Secretaries.

• (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 Tricor Standard 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 shall prevail over the Chinese text.

10. 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 29 May 2008:

• (a) the Joint Venture Agreement;

• (b) Offshore Supplemental Agreement;

• (c) Onshore Shareholders Memorandum;

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GENERAL INFORMATION

APPENDIX

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

• (e) the “Letter of advice from the Independent Financial Adviser” as set out in this circular; and

• (f) the letter of consent from Anglo Chinese referred to in paragraph 6 of this Appendix.

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NOTICE OF SPECIAL GENERAL MEETING

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(Incorporated in Bermuda with limited liability)

(Stock Code: 983)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that a special general meeting of Shui On Construction and Materials Limited (the “Company”) will be held at Room 103, 1st Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong on Thursday, 29 May 2008 at 3:15 p.m. (or so soon thereafter as the annual general meeting of the Company convened at the same place and date at 3:00 p.m. shall have concluded or adjourned) for the purpose of considering and, if thought fit, passing with or without amendments, the following resolution as an ordinary resolution of the Company:

ORDINARY RESOLUTION

“ THAT

• (a) the Second Further Injection (as defined in the circular to shareholders of the Company dated 13 May 2008) and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified; and

• (b) the directors of the Company (“ Directors ”) be and are hereby authorised to do all such further acts and things and execute such further documents and take all steps which in their opinion may be necessary, desirable or expedient to implement and/or give effect to the Second Further Injection and all other transactions contemplated thereunder with any changes as such Directors may consider necessary, desirable or expedient.”

By Order of the Board Tsang Yuet Kwai Company Secretary

Hong Kong, 13 May 2008

* For identification purpose only

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NOTICE OF SPECIAL GENERAL MEETING

Notes:

• (1) Any member entitled to attend and vote at the above meeting is entitled to appoint one or more proxies to attend and, on a poll, vote in his stead. A proxy need not be a member of the Company.

• (2) To be valid, a form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a certified copy thereof, must be lodged with the head office of the Company at 34th Floor, Shui On Centre, 6-8 Harbour Road, Hong Kong not less than 48 hours before the time fixed for holding the meeting.

At the date of this notice, the executive directors of the Company are Mr. Lo Hong Sui, Vincent, Mr. Choi Yuk Keung, Lawrence, Mr. Wong Yuet Leung, Frankie, Ms. Lau Jeny and Mrs. Lowe Hoh Wai Wan, Vivien; the non-executive director of the Company is Professor Michael Enright; and the independent non-executive directors of the Company are Mr. Anthony Griffiths, Mr. Cheng Mo Chi, Moses and Mr. Gerrit de Nys.

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