MGX RESOURCES LIMITED — Major Shareholding Notification 2006

Oct 30, 2006

LAWYERS

Glibert + Tobin

2 Park Street Sydney NSW 2000 Australia

GPO Box 3810 Sydney NSW 2001

1+61 2 9263 4000 $F + 61292634111$

DX 10348 SSE

www.gtlaw.com.au

Partner Rachel Launders 1+61292634143 rlaunders@gtlaw.com.au Our ref RAL

31 October 2006

By fax | 24 pages

Company Announcements Platform To Australian Stock Exchange Limited Fax 1900 999 279

Mount Gibson Iron Limited

Please find enclosed a Form 603 - Notice of Initial Substantial Holder in relation to Mount Gibson from Limited.

Yours faithfully Gilbert + Tobin

fioli

Rachel Launders Partner T +61 2 9263 4143 rlaunders@gtlaw.com.au

This facsimile is solely for the use of the addressee and may contain information which is confidential or privileged. If you receive this facsimile in error, please notify us immediately and we will arrange for its return at our expense.

Liability limited by a scheme approved under Professional Standards Legislation. 1125125 1 doc

603 Page 1/2 15 July 2001

Form 603

Corporations Act 2001 Section 671B

Notice of initial substantial holder

Τo	Company Name/Scheme	Mount Gibson Iron Limited
	ACN/ARSN	008 670 817
	1. Details of substantial holder (1)
Name		Shanghai Merchants Holdings Limited and the entities listed in Attachment A
	ACN/ARSN (if applicable)	N/A

27/10/2006

The holder became a substantial holder on

1. Details of voting power

The total number of votes attached to all the voting shares in the company or voting interests in the scheme that the substantial holder or an associate (2) had a relevant interest (3) in on the date the substantial holder became a substantial holder are as follows:

Class of securities (4)	Number of securities	Person's votes (5)	Voting power (6)
Ordinary	48.373.197	48.373.197	10.63%
		. .

3. Details of relevant interests

The nature of the relevant interest the substantial holder or an associate had in the following voting securities on the date the substantial holder became a substantial holder are as follows:

Holder of relevant interest.	Nature of relevant interest (7)	Class and number of securities
Fortune Desire Investments Limited (Fortune Desire)	Purchaser of shares under a conditional sale agreement dated 27 October 2006 (a copy of which is Attachment B)	48,373,197 ordinary shares
Shanghai Merchants Holdings Limited (SMHL)	Controller of Fortune Desire (Section 608(3)(b))	48,373,197 ordinary shares
Profit Harbour Investments Limited and Mr Yue Jialin (Profit Harbour)	Holder of more than 20% of SMHL (Section 608(3)(a))	48.373.197 ordinary shares
(Hong Holding Kong) Shougang Limited Limited and Benefit Rich (Shougang)	Holder of more than 20% of SMHL (Section 608(3)(a))	48.373.197 ordinary shares

4. Details of present registered holders

The persons registered as holders of the securities referred to in paragraph 3 above are as follows:

Holder of relevant Registered holder of interest securities		Person entitled to be registered as holder (8)	Class and number of securities
Fortune Desire. SMHL, Profit Harbour and Shougang	New Fortress Investments Limited	Fortune Desire	31.691.899 ordinary shares
Fortune Desire. SMHL, Profit Harbour and Shougang	Honest Opportunity Limited	Fortune Desire	16.681.298 ordinary shares

5. Consideration

The consideration paid for each relevant interest referred to in paragraph 3 above, and acquired in the four months prior to the day that the substantial holder became a substantial holder is as follows:

Holder of relevant interest	Date of acquisition	Consideration (9)		Class and number of securities
		Cash	Non-cash
Desire. Fortune SMHL, Profit Harbour and Shougang	27/10/2006	A0.85 per share	nil	48,373,197 shares	ordinary

6. Associates

The reasons the persons named in paragraph 3 above are associates of the substantial holder are as follows:

Name and ACN/ARSN (if applicable)	Nature of association
See Attachment A	See Attachment A

7. Addresses

The addresses of persons named in this form are as follows:

Name	Address
All carties	C/- Shanghai Merchants Holdings Limited, Rooms 2808-10, 28th Floor, Wing On House, 71 Des Voeux Road Central, Hong Kong

Signature

print name	MICHAEL BOGUE

capacity Director

sign here

date					31/10/2006
------	--	--	--	--	------------

DIRECTIONS

wL

• If there are a number of substantial holders with similar or related relevant interests (eg. a corporation and its related corporations, $(1)$ or the manager and trustee of an equity trust), the names could be included in an annexure to the form. If the relevant interests of a group of persons are essentially similar, they may be referred to throughout the form as a specifically named group if the
  membership of each group, with the names and addresses of members is clearly set out in paragraph
• $(2)$ See the definition of 'associate' in section 9 of the Corporations Act 2001.
• See the definition of 'relevant interest' in sections 608 and 671B(7) of the Corporations Act 2001. $(3)$
• $(4)$ The voting shares of a company constitute one class unless divided into separate classes.
• $(5)$ The total number of votes attached to all the voting shares in the company or voting interests in the scheme (if any) that the person or an associate has a relevant interest in,

• The person's votes divided by the total votes in the body corporate or scheme multiplied by 100. $(6)$

• $(7)$ Include details of:

• $(a)$ any relevant agreement or other circumstances by which the relevant interest was acquired. If subsection 671B(4) applies, a copy of any document setting out the terms of any relevant agreement, and a statement by the person giving full and accurate details of any contract, scheme or arrangement, must accompany this form, together with a written statement certifying this contract, scheme or arrangement; and
• $(b)$ any qualification of the power of a person to exercise, control the exercise of, or influence the exercise of, the voting powers or disposal of the securities to which the relevant interest relates (indicating clearly the particular securities to which the qualification applies).

See the definition of 'relevant agreement' in section 9 of the Corporations Act 2001.

• If the substantial holder is unable to determine the identity of the person (eg. if the relevant interest arises because of an option) $(3)$ write 'unknown'.
• $(9)$ Details of the consideration must include any and all benefits, money and other, that any person from whom a relevant interest was acquired has, or may, become entitled to receive in relation to that acquisition. Details must be included even if the benefit is conditional on the happening or not of a contingency. Details must be included of any benefit paid on behalf of the substantial holder or its associate in relation to the acquisitions, even if they are not paid directly to the person from whom the relevant interest was acquired.

Attachment A

This is attachment A of 1 page, referred to in the Form 603 - Notice of initial substantial holder lodged by Shanghai Merchants Holdings Limited dated 31 October 2006 and signed by me.

y
Adul

Michael Bogue
31 October 2006

The substantial holders are the companies and individual noted in item 3 and the following subsidiaries of Shanghai Merchants Holdings Limited

Asia Cheer Trading Limited Sky Joy Management Limited Sino Chance Trading Limited Park Well International Group Limited First Landmark Limited Merchants (Hong Kong) Limited Rise Cheer Limited Net Success Investments Limited Chinaright Electronics Limited

$\bar{z}$

Attachment B

This is attachment B of $\vert \mathbf{q} \vert$ pages, referred to in the Form 603 – Notice of initial substantial holder lodged by Shanghai Merchants Holdings Limited dated 31 October 2006 and signed by me.

Michael
Michael Bogue
31 October 2006 Krque

$\bar{z}$

l,

$\bar{\tau}$ .

$\bar{z}$

$\ddot{\cdot}$

Dated 27th October, 2006

• HONEST OPPORTUNITY LIMITED $(1)$
• NEW FORTRESS INVESTMENTS LIMITED $(2)$
• FORTUNE DESIRE INVESTMENTS LIMITED $(3)$

AGREEMENT FOR SALE AND PURCHASE

relating to

48.373.197 ordinary shares of MOUNT GIBSON IRON LIMITED (a company incorporated in Australia with limited liability)

P.C. WOO & CO. Solicitors and Notaries

12th Floor, Prince's Building Central, Hong Kong

Ref:HL:LKM:DW:CYL

$\sim 10^{11}$

TABLE OF CONTENTS

|--|

1.	DEFINITIONS AND INTERPRETATION
2.	SALE AND PURCHASE OF THE SALE SHARES
3.	CONDITIONS PRECEDENT
4.	COMPLETION
5.	WARRANTIES
6.	CONFIDENTIALITY
7.	FURTHER ASSURANCES
8.	ENTIRE AGREEMENT
9.	SEVERABILITY
10.	WAIVER AND OTHER RIGHTS
11.	NOTICES
12.	TIME
13 7	ASSIGNMENT
14.	COSTS AND EXPENSES
15.	COUNTERPARTS
16.	GOVERNING LAW AND JURISDICTION
	SCHEDULE
	EXECUTION PAGE

$\mathcal{L}^{\text{max}}{\text{max}}$ and $\mathcal{L}^{\text{max}}{\text{max}}$

THIS AGREEMENT is made the $\Im \mathcal{H}$ day of October 2006

BETWEEN:-

• HONEST OPPORTUNITY LIMITED, a company incorporated with limited $(1)$ liability in the British Virgin Islands having its registered office at P.O. Box 957, Offshore Incorporations Centre, Road Town, British Virgin Islands ("HOL");
• NEW FORTRESS INVESTMENTS LIMITED, a company incorporated with $(2)$ limited liability in the British Virgin Islands having its registered office at P.O. Box 957, Offshore Incorporations Centre, Road Town, British Virgin Islands ("NFIL");

(HOL and NFIL are collectively referred to as the "Vendors"); and

FORTUNE DESIRE INVESTMENTS LIMITED, a company incorporated $(3)$ with limited liability in the British Virgin Islands and having its registered office at P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands (the "Purchaser").

WHEREAS -

• As at the date of this Agreement:- $\langle \Lambda \rangle$
• HOL is the legal and beneficial owner of 16,681,298 ordinary shares of $(i)$ the Company;
• NFIL is the legal and beneficial owner of 31,691,899 ordinary shares of $(i)$ the Company;
• the Purchaser is a private company directly and wholly owned by $(iii)$ Shanghai Merchants Holdings Limited ("SMHL") being a listed company with its shares listed on the Main Board of the Hong Kong Stock Exchange.
• The Vendors wish to sell, and the Purchaser wishes to purchase, the Sale Share $(B)$ on the terms and conditions set out in this Agreement.

NOW IT IS AGREED as follows:-

DEFINITIONS AND INTERPRETATION 1.

In this Agreement, including the recitals and the Schedules, unless the context $(A)$ otherwise requires, the following terms have the respective meanings set opposite them:-

Australian Stock Exchange; "ASX"

$\label{eq:2.1} \frac{1}{\sqrt{2}}\int_{\mathbb{R}^3}\frac{1}{\sqrt{2}}\left(\frac{1}{\sqrt{2}}\right)^2\frac{1}{\sqrt{2}}\left(\frac{1}{\sqrt{2}}\right)^2\frac{1}{\sqrt{2}}\left(\frac{1}{\sqrt{2}}\right)^2.$

$\Delta \sim 10^{11}$

"Authorisation"	any approval, authorisation, consent, licence, certificate, permit, concession, agreement or other permission of any kind of, from or by any Governmental Authority and regulatory body;
"business day"	a day on which banks in Hong Kong are open for business, other than:-
	a Saturday; (i)
	a Sunday; or (ii)
	a day on which a tropical cyclone (iii) warning signal no. 8 or above or a black rainstorm warning signal is hoisted in Hong Kong at any time between 9:00 a.m. and 5:00 p.m.;
"CHESS"	The Clearing House Electronic Subregister System as operated by Australian Clearing House Pty Ltd;
"Clearing Rules"	the Clearing Rules of CHESS from time to time in force.
"Company"	MOUNT GIBSON IRON LIMITED, a company incorporated under the laws of Australia with limited liability and with its shares listed on ASX (Stock Code: MGX);
"Completion"	completion of the sale and purchase of the Sale Share pursuant to this Agreement, by the performance by the Parties of the several obligations contained in Clause 4;
"Conditions"	the conditions precedent mentioned in Clause $3(A)$ ;
"Confidential Information"	with respect to any person, any know-how, knowledge, technique, design, process, information, data, material, specification, secret or other confidential OГ trade economic information possessed, developed or acquired by such person for any purpose or in any business or capacity, or in relation to the transactions contemplated in this Agreement.

$\epsilon_{\rm m}$

any mortgage, charge, pledge, lien, $(i)$ hypothecation, encumbrance or "Encumbrance" other security arrangement of any kind; any option, equity, claim, adverse $(ii)$ interest or other third party right of any kind; any arrangement by which any right $(iii)$ is subordinated to any right of such third party; or any contractual right of set-off, $(iv)$ including any agreement or commitment to create or procure to create, or to permit or suffer to be created or subsisted any of the above: any government (or political subdivision of "Governmental Authority"

it), whether on a state, provincial, municipal or local level and whether executive, legislative or judicial in nature, including (without limitation) any agency, authority, court, commission, bureau, board, department or any other instrumentality;

Hong Kong Special Administrative Region "Hong Kong" of the People's Republic of China;

"Hong Kong Stock Exchange"

"Law"

The Stock Exchange of Hong Kong Limited;

statutory statute or any law. $(i)$ regulation, rule, provision, constitutional provision, treaty or rule of common law or equity;

• any order, notice or decree of any $(ii)$ Governmental Authority or other matter of any kind having the force of law; or
• any order, decree, judgment or $(iii)$ award of any court, tribunal or arbitrator of a competent jurisdiction;

$\mathcal{L}^{\text{max}}_{\text{max}}$

"Listing Rules"	Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited;
"Participant"	a person admitted for the time being by Australian Clearing House Pty Ltd as a participant of CHESS;
"Party"	any party to this Agreement;
"Proceedings"	any legal, administrative or arbitration action, suit, complaint, charge, hearing, enquiry, investigation OГ injunction, proceedings;
"Related Company"	with respect to a company, any of its subsidiaries ОT holding companies, associates, or any company which is a subsidiary or associate of any of its holding companies;
"Relevant Persons"	with respect to a company, body (i) corporate or legal person, its directors, officers, employees, agents, and representatives, consultants advisers (in each case, whether as an employee, in a professional capacity or otherwise); and
	with respect to a person other than a (ii) company, body corporate or legal officers, person, its partners, employees, agents, representatives, consultants and advisers (in each case, whether as an employee, in a professional capacity or otherwise);
"Sale Shares" or each "Sale Share"	48,373,197 ordinary shares, representing approximately 10.63% of the issued share capital of the Company (as at the date hereof);
"Tax"	all forms of taxation (including, with limitation, taxes with respect to income, franchises, windfall, capital gain or other profits, enterprise assets, movable and immovable properties, import or export and tariffs, deductions, valorem), ad withholdings, duties (including, without

limitation, custom and estate duties), imposts, levies, fees, charges, social security contributions, assessments, rates or other charges of any kind (together with any and all interest, penalties, additions to tax, inflation or other adjustments and additional amounts imposed with respect to any of them) imposed, levied, collected, withheld or assessed by any Governmental Authority in Hong Kong or Australia or elsewhere;

the representations and warranties contained "Warranties" in Clause 5 and Schedule.

• In this Agreement, including the recitals and the Schedule, unless the context (B) otherwise requires:
• references to "Clauses" and "Schedule" are references to clauses of, and $(i)$ schedule to, this Agreement;
• references to this Agreement include this Agreement, the Schedule and all $(i)$ other documents executed in accordance with this Agreement and expressed to be supplemental to this Agreement;
• headings are for convenience only and shall not limit, extend, vary or $(iii)$ otherwise affect the construction of any provision of this Agreement;
• words and expressions importing the singular include the plural and vice $(iv)$ versa;
• words and expressions importing one gender include both genders and the $(v)$ neuter, and references to persons include natural persons, bodies corporate or unincorporated, sole proprietorships, partnerships, associations, enterprises, branches and all other forms of organisations and entities;
• references to a Party include its personal representatives, successors, heirs, $(vi)$ beneficiaries, sureties and permitted assigns,
• where any word or expression is given a defined meaning, any other $(vii)$ grammatical form of such word or expression (as the case may be) shall have a corresponding meaning;
• references to writing include any method of producing or reproducing $(viii)$ words in a legible and non-transitory form;
• references to statutory provisions shall be construed as references to those $(ix)$ provisions as respectively amended or re-enacted (whether before or after the date of this Agreement) from time to time and shall include any provision of which they are re-enactments (whether with or without

modification) and any subordinate legislation made under such statutory provisions; and

• references to anything which a Party is required to do or not to do shall $(x)$ include its acts, defaults and omissions, whether:
• direct or indirect; $(a)$
• on its own account; or $(b)$
• for or through any other person, $(c)$

and shall include acts, defaults and omissions which it permits or suffers to be done or not done by any other person.

The Schedule is part of this Agreement and shall have effect accordingly. $(C)$

SALE AND PURCHASE OF THE SALE SHARES $\overline{2}$ .

• On the terms but subject to the conditions set out in this Agreement, the Vendors $(A)$ as beneficial owners shall sell the Sale Shares and the Purchaser shall purchase the Sale Shares, free from any cncumbrance and together with all rights and benefits attaching or accruing to it on or after Completion.
• The aggregate consideration for the sale and purchase of the Sale Shares shall be (B) HK\$244,474,751.51 (equivalent to A\$41,117,217.45 or A\$0.85 per Sale Share at an exchange rate of A\$1.00 to HK\$5.9458), to be settled:
• as to HK\$20,000,000.00 (the "Deposit"), payable by the Purchaser to the $(i)$ Vendors or as they may direct upon signing of this Agreement; and
• as to the balance, payable by the Purchaser to the Vendors (or as they may $(ii)$ direct) at the earlier of the expiry of five business days after the completion of the contemplated transactions of SMHL under Clause 3A and 7^th February, 2007, provided that the parties hereto may agree to an extension for a further period at such term(s) as agreed by parties hereto.

CONDITIONS PRECEDENT 3.

Completion shall be conditional upon:- $(\Lambda)$

• the purchase of the Sale Shares by the Purchaser pursuant to the terms of this Agreement being approved by the shareholders of SMHL in $\left( i\right)$ accordance with all applicable requirements under the Listing Rules;
• completion of a rights issue in terms and conditions acceptable to SMHL in order to pay the consideration of the Sale Shares under Clause 2(B)(i) $(ii)$ above; and
• all necessary Authorisations being obtained and maintained by the Purchaser as a result of the transactions contemplated in this Agreement. $(iii)$
• The Purchaser may, at its absolute discretion, waive any of the Conditions in writing other than those in Clauses 3(A) (i) and (iii), and such waiver may be $(B)$ made subject to terms and conditions as agreed by the Purchaser and the Vendors;
• The Purchaser undertakes to the Vendors to use its best endeavour to fulfil, or procure the fulfilment of, the Conditions on or before $7^{\text{th}}$ February, 2007 (or such $(C)$ earlier or later date as may be agreed by the Vendors and the Purchaser in writing).
• If any of the Conditions is not fulfilled (or waived by the Purchaser) on or before 7^th February, 2007 (or such earlier or later date as may be agreed by the Vendors $(1)$ and the Purchaser in writing):
• no party shall be obliged to proceed to Completion; $(i)$
• the Deposit shall be refunded to the Purchaser (without interest) forthwith; $(ii)$
• the provisions of this Agreement, except Clauses 1, 6, 11, 14, 15 and 16 $(iii)$ which shall remain in full force and effect, shall from such date cease to have any effect; and
• no Party shall have any claim against any of the other Parties, except in $(iv)$ respect of:
  • claims arising out of any antecedent breach of any of the $\left( \alpha \right)$ provisions of this Agreement; and
  • claims arising out of the continuing provisions mentioned in $(b)$ paragraph (iii) above.
• The Purchaser shall compensate the Vendors for any loss suffered due to breach of $(E)$ agreement by the Purchaser. Any breach of agreement by the Purchaser, making it unable to proceed with Completion of this Agreement, the Vendors shall have the

right to terminate this Agreement, and the Purchaser shall be responsible to the Vendors for compensation for its breach.

COMPLETION $\mathbf{4}$ .

• Completion shall take place at the earlier of the expiry of five business days after the completion of the contemplated transactions of SMHL under Clause 3A and $(A)$ $7^th$ February, 2007 (or such earlier or later date as may be agreed by the Vendors and the Purchaser in writing) at the offices of the solicitors for the Purchaser in Hong Kong (or such other place as may be agreed by the Vendors and the Purchaser in writing).
• At Completion, all (but not part only, except where and to the extent as agreed by the Vendors and the Purchaser) of the following business shall be transacted:- $(B)$
• the Vendors shall:- $(i)$
  • procure that its designated Participant gives an irrevocable $(a)$ delivery instruction to effect a book-entry settlement of the Sale Shares in accordance with this Agreement and the Clearing Rules to the credit of the CHESS stock account(s) of the Participant(s) of the Purchaser as notified to the Vendor by the Purchaser prior to Completion:
  • (b) deliver or procure to be delivered to the Purchaser or as it may direct, evidence of the giving of the delivery instruction as described in paragraph (a) above; and
  • deliver or procure to be delivered to Purchaser certified copy of the $(c)$ resolution of the board of directors of the Vendors authorising the execution and completion of this Agreement;
  • such other documents as may be reasonably required to give a $(d)$ good title to the Sale Shares and to enable the Purchaser to become the registered holder of the Sale Shares;
  • the Purchaser shall (a) make or procure the making of payment, at good fund, to the Vendors (or as they may direct) pursuant to Clause 2(B)(ii). $(ii)$ Such payment shall be made by telegraphic transfer to such bank account of the Vendors or such bank account(s) with a licensed bank in Hong Kong as may be notified by the Vendors to the Purchaser and (b) deliver or procure to be delivered to Vendors certified copies of the resolutions of the board of directors of Purchaser and shareholders of SMHL authorising the execution and completion of this Agreement and such other documents relating to transactions contemplated hereby as may be reasonably required by Vendors.

WARRANTIES $5₁$

• The Vendors jointly and severally acknowledge that the Purchaser has entered into this Agreement in reliance on the Warranties, notwithstanding $(\Lambda)$ information regarding the Company which may otherwise have come into the possession of the Purchaser or which the Purchaser ought to have known or had constructive knowledge of.
• The Vendors, unconditionally and irrevocably, jointly and severally represent and (B) warrant to the Purchaser that except to the extent disclosed to the Purchaser prior to the signing of this Agreement, each of the Warranties is true and accurate and not misleading in any material respect as given as of the date of this Agreement and as of Completion, and as if given at all times between the date of this Agreement and Completion.
• Each of the Warranties is separate and independent, and the rights and remedies $(C)$ of the Purchaser in respect of any breach of the Warranties shall not be affected or determined by any investigation made by the Purchaser or by any other event whatsoever, except with a specific and duly authorised waiver or release by the Purchaser.

CONFIDENTIALITY 6.

• Each Party shall at all times maintain absolute confidentiality of this Agreement, $(A)$ and shall not disclose any of the contents or existence of this Agreement to any other person (other than to its Relevant Persons in the proper course of their duties) at any time, without the prior consent of all the other Parties in writing.
• Each Party undertakes with each of the other Parties:- $(B)$
• to hold all Confidential Information received from or provided by the $(i)$ other Party in connection with this Agreement or otherwise as absolute secret;
• not to disclose or cause, permit or suffer to be disclosed any such $(ii)$ Confidential Information to any other person, save where:
  • such disclosure is made with the prior consent of the other Party in $(a)$ writing; and
  • the person to whom such disclosure is made agrees to be bound by $(b)$ similar terms of confidentiality by executing a non-disclosure agreement to the reasonable satisfaction of the non-disclosing Party;
• not to use, publish, duplicate or copy or cause, permit or suffer to be used, $(iii)$ published, duplicated or copied any such Confidentiality Information in

any form or manner or for any purpose, save for the proper performance of its obligations under this Agreement or the enforcement of this Agreement: and

• to ensure that its Relevant Persons, its Related Companies and their respective Relevant Persons shall not, save in the proper course of their $(iv)$ duties, at any time during or after their employment disclose or cause, permit or suffer to be disclosed any such Confidential Information to any person or use, publish, duplicate or copy or cause, permit or suffer to used, published, duplicated or copied any such Confidential Information in any form or manner or for any purpose.
• The provisions set out in this Clause 6 shall not apply to a Party in respect of any $(C)$ Confidential Information which:
• the other Party has identified it as being non-confidential; $(i)$
• has come into public domain otherwise than by any breach on the part of $(ii)$ such Party, or
• is required by any relevant Governmental Authority or regulatory body, by $(iii)$ any Law or any listing rules of any relevant stock exchange, or pursuant to an order of a court of competent jurisdiction to be disclosed.
• The provisions in this Clause 6 shall apply during the subsistence of this $(D)$ Agreement and shall continue to apply for a period of six months after the termination of this Agreement.

FURTHER ASSURANCES $7.$

Each of the parties shall execute such documents and perform such further acts as the other(s) of them may require to vest effectively in the relevant parties the legal and beneficial ownership of the Sale Shares free from all charges, liens, encumbrances, equities and other adverse claims and interests and with all rights now and hereafter attaching thereto.

ENTIRE AGREEMENT 8.

This Agreement sets forth the entire agreement and understanding between the Parties in relation to the transactions contemplated by this Agreement, and supersedes and cancels in all previous letters of intent, correspondence, understandings, agreements and undertakings (if any) between the Parties with respect to the subject matter of this Agreement, whether such be written or oral.

SEVERABILITY 9.

If at any time one or more of the provisions of this Agreement is or becomes invalid, illegal, unenforceable or incapable of performance in any respect, the validity, legality, enforceability or performance of the remaining provisions of this Agreement shall not thereby in any way be affected or impaired.

WAIVER AND OTHER RIGHTS $10.$

• No single or partial exercise of, or failure or omission to exercise or delay in exercising any right, power, claim or remedy vested in any Party under or $(\Lambda)$ pursuant to this Agreement or otherwise shall affect, prejudice or constitute a waiver by such Party of such or any other right, power, claim or remedy.
• Any right, power, claim or remedy expressly conferred upon any Party under this Agreement shall be in addition to and without prejudice to all other rights, powers, $(B)$ claims and remedies which would otherwise be available to such Party under this Agreement or at law.

$11.$ NOTICES

• Any notice, demand or other communication to be given by a Party to any other $(A)$ Party under this Agreement shall be in writing, and shall be deemed duly served if:
• delivered personally; $(i)$
• sent by prepaid registered post, or $(ii)$
• sent by facsimile transmission, $(iii)$

to the address or facsimile number (as the case may be) of such other Party previously in writing notified to the Party serving the same (and, in the case of any subsequent change of the address or facsimile number, such notification shall be given in accordance with the provisions of this Agreement and shall state in clear terms the intention to change the address or facsimile number, as the case may bc).

• A notice, demand or other communication shall be deemed served:-(B)
• if delivered personally, at the time of delivery; $(i)$

• if sent by post, at the expiration of two business days (for local addresses $(ii)$ in Hong Kong) or five business days (for any other overseas address) after the envelope containing the same has been delivered into the custody of the postal authorities; and

• if sent by facsimile transmission, upon receipt by the Party giving the $(iii)$ same of machine printed confirmation of such transmission.

• In proving the service of any notice, demand or other communication, it shall be $(C)$ sufficient to prove that:
• in the case of personal delivery, the same has been delivered or left at the $(i)$ address, or the postal box of such address, of the Party to be served on;
• in the case of a mail, the envelope containing the same has been properly $(ii)$ addressed, delivered into the custody of the postal authorities and duly stamped; and
• in the case of a facsimile transmission, the same has been duly transmitted $(iii)$ to the facsimile number of the Party to be served on.
• For the purposes of this Clause 11, the initial address and facsimile number of $(D)$ each Party are:-

HONEST OPPORTUNITY LIMITED

Address: c/o 47/F., China Online Centre, 333 Lockhart Road, Wanchai, Hong Kong

Facsimile number: (852) 2771 7421

For the attention of Dato' Wong Peng Chong

NEW FORTRESS INVESTMENTS LIMITED

Address: c/o 47/F., China Online Centre, 333 Lockhart Road, Wanchai, Hong Kong

Facsimile number: (852) 2771 7421

For the attention of Dato' Wong Peng Chong

FORTUNE DESIRE INVESTMENTS LIMITED

Address: Rooms 2808-2810, 28^th Floor, Wing On House, 71 Des Voeux Road Central, Hong Kong

Facsimile number: (852) 2541 9133

For the attention of Mr. Lau Yau Cheung, Brent

TIME 12.

Time shall be of the essence of this Agreement, both as regards the dates and periods specifically mentioned in this Agreement and as to any date and period which may by written agreement between or on behalf of the Parties be substituted for them.

ASSIGNMENT 13.

This Agreement shall be binding on and shall ensure for the benefit of the successors and assignees of the Parties. None of the Parties may assign any of its rights or obligations under this Agreement without the prior consent of the other Parties in writing.

COSTS AND EXPENSES $14^°$

Each party shall bear all its own legal and professional fees, respective stamp duty, costs and expenses of and incidental to the negotiation, preparation, execution and completion of this Agreement.

COUNTERPARTS 15.

This Agreement may be executed in any number of counterparts and by any Party on separate counterparts, each of which when so executed and delivered shall be an original, but all the counterparts together shall constitute one and the same instrument.

GOVERNING LAW AND JURISDICTION 16.

• This Agreement shall be governed by and construed in all respects in accordance $(A)$ with the laws of Hong Kong.
• The Parties submit to the non-exclusive jurisdiction of the courts of Hong Kong. $(B)$
• The Vendors irrevocably appoint China Online Sceretaries Limited at 47^th Floor China Online Centre, 333 Lockhart Road, Wanchai, Hong Kong as its agent to $(C)$ receive and acknowledge on its behalf service of any writ, summons, order, judgment or other notice of legal process in Hong Kong. Any such legal process shall be sufficiently served on it if delivered to such service agent.
• If the service agent of any party ceases to be able to act as service agent for any $(D)$ reason or no longer has an address in Hong Kong, a substitute service agent with an address in Hong Kong acceptable to the other parties shall be appointed, and a copy of the substitute service agent's acceptance of such appointment shall be given to the other parties within seven days from the date of such appointment.

$\bar{\omega}$

Prior to the receipt by the other parties of a copy of the substitute service agent's acceptance of appointment or in the event of any failure to appoint a substitute service agent, it shall be effective service for the ot

$\cdot$

$\overline{\phantom{a}}$

2006-10-31 14:56

SCHEDULE

The Warranties

The Vendors hereby warrant and undertake to and with the Purchaser, that the facts set out in (A) (i) and (ii) of Recitals hereto and all of the following matters are now and will at Completion be true and accurate:

• the Vendors are duly incorporated and are currently existing as body $(a)$ corporates under the laws of the jurisdiction of its incorporation;
• the Vendors are the beneficial owners of the Sale Shares, and have the $(b)$ right, power and authority to sell and transfer the Sale Shares on the terms of this Agreement without the consent of any third party and free from all charges, liens, encumbrances, equities and other third party claims and interests of any nature whatsoever and with all rights now and hereafter attaching thereto including without limitation the right to all dividends hereafter paid, declared or made in respect thereof; and
• upon delivery of the Sale Shares to the Purchaser in accordance with the $(c)$ terms of this Agreement, good and valid title to the Salc Shares, free and clear of all charges, liens, encumbrances, equities and other third party claims and interests of any nature whatsoever will pass to the Purchaser as beneficial owner.

$\mathbb{R}^2$

FAX100

$\mathcal{A}$

EXECUTION PAGE

IN WITNESS whereof the Parties have executed this Agreement the day and year first above written.

$\mathcal{Y}$ SIGNED by $\lambda$ For and on behalf of
HONEST OPFORTUNITY LIMITED ð for and on behalf of HONEST OPPORTUNITY LIMITED in the presence of thorised Signature(s) $\mathcal{E}$ SIGNED by For and on hebalf of
NEW FORTHERS INVESTMENTS LIMITED $\lambda$ $\lambda$ for and on behalf of NEW FORTRESS INVESTMENTS ) $\lambda$ LIMITED thorised Signature(s) $\lambda$ In the presence of :-) SIGNED by $\mathcal{Y}$ For and on behalf of SAN AND STATED Ć for and on behalf of FORTUNE DESIRE INVESTMENTS ) $\mathcal{Y}$ LIMITED $\lambda$ in the presence of .-Authorized Signature(s)

$-16-$

$\overline{\phantom{a}}$