National Electronics Holdings Limited — Proxy Solicitation & Information Statement 2005

Oct 21, 2005

IMPORTANT

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

If you have sold or transferred all your shares in Chinese Estates Holdings Limited, you should at once hand this circular to the purchaser(s) or transferee(s) or to the bank, stockbroker 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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• (Incorporated in Bermuda with limited liability)

(Stock Code: 127)

DISCLOSEABLE TRANSACTION

FORMATION OF A JOINT VENTURE

21st October, 2005

CONTENTS

Page DEFINITIONS ....................................................................................................................…...................... ii LETTER FROM THE BOARD Introduction ..........................................................................................................................…............. 1 The joint venture entity - Bestwise ............................................................................…........................ 2 Reasons for the joint venture ....................................................................................…......................... 3 Information on the Group .................................................................................................…................. 3 Information on Sino Land and Nan Fung .........................................................…................................ 3 Financial effects of the formation of Bestwise ..........................................................…....................... 4 General ...........................................................................................................................…................... 4 APPENDIX : GENERAL INFORMATION .............................…......................................…................. 5

i

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

“Announcement” the announcement issued by the Company dated 3rd October, 2005 “Best Profit” Best Profit Limited, a company incorporated in Hong Kong “Bestwise” Bestwise Resources Limited, a company incorporated in the British Virgin Islands, which is owned as to 25% by the Company through Fine Famous, 50% by Sino Land through King Chance and 25% by Nan Fung through Glory Top “Bestwise Group” Bestwise and its two wholly-owned subsidiaries being Best Profit and Union Empire “Board” or “Directors” the board of directors of the Company “Company” Chinese Estates Holdings Limited, a company incorporated in Bermuda, the shares of which are listed on the main board of the Stock Exchange “Fine Famous” Fine Famous Limited, an indirect wholly-owned subsidiary of the Company incorporated in Hong Kong “Glory Top” Glory Top Development Limited, a direct wholly-owned subsidiary of Nan Fung incorporated in Hong Kong “Government” the Government of Hong Kong “Group” the Company and its subsidiaries “Hoi Ting Road Land” the piece of land with a site area of 79,621 sq.ft. located at Kowloon Inland Lot No. 11168, Hoi Ting Road, West Kowloon Reclamation Area “Hong Kong” the Hong Kong Special Administrative Region of the People's Republic of China “Junction of Hoi Wang Road the piece of land with a site area of 66,511 sq.ft. located at and Hoi Ting Road Land” Kowloon Inland Lot No. 11167, Junction of Hoi Wang Road and Hoi Ting Road, West Kowloon Reclamation Area “JV Partners” the three joint venture partners of Bestwise, being the Company, Sino Land and Nan Fung

“King Chance” King Chance Development Limited, a direct wholly-owned subsidiary of Sino Land incorporated in Hong Kong

ii

DEFINITIONS

“Lands”	Hoi Ting Road Land and the Junction of Hoi Wang Road and Hoi
	Ting Road Land
“Land Costs”	the aggregate bidding price for the Lands amounting to HK$5.92
	billion
“Latest Practicable Date”	18th October, 2005, being the latest practicable date prior to the
	printing of this circular for ascertaining certain information
	included in this circular
“Listing Rules”	The Rules Governing the Listing of Securities on the Stock
	Exchange in force for the time being
“Nan Fung”	Nan Fung Development Limited, a company incorporated in Hong
	Kong
“Projects”	the development of the Lands by the JV Partners into residential
	and retail properties with a total residential gross floor area of
	517,533 sq.ft. and 432,314 sq.ft. and non-residential gross floor
	area of 79,621 sq.ft. and 66,511 sq.ft. for the Hoi Ting Road Land
	and the Junction of Hoi Wang Road and Hoi Ting Road Land
	respectively
“SFO”	Securities and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong)
“Shareholders”	the shareholders of the Company
“Sino Land”	Sino Land Company Limited, a company incorporated in Hong
	Kong, the shares of which are listed on the main board of the Stock
	Exchange
“Sino Land Group”	Sino Land and its subsidiaries
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“TST Properties”	Tsim Sha Tsui Properties Limited, a company incorporated in
	Hong Kong, the shares of which are listed on the main board of the
	Stock Exchange
“Union Empire”	Union Empire Limited, a company incorporated in Hong Kong
“HK$”	Hong Kong Dollars, the lawful currency of Hong Kong
“US$”	United States Dollars, the lawful currency of the United States of
	America
“sq.ft.”	square feet
“%”	per cent

iii

LETTER FROM THE BOARD

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(Incorporated in Bermuda with limited liability)

(Stock Code: 127)

Executive Directors: Thomas Lau, Luen-hung (Chairman) Joseph Lau, Luen-hung (Chief Executive Officer)

Non-executive Director: Amy Lau, Yuk-wai

Independent Non-executive Directors: Koon, Wing-yee Cheng, Kwee Chan, Kwok-wai

Registered Office: Canon's Court 22 Victoria Street Hamilton HM 12 Bermuda

Principal Office in Hong Kong: 26th Floor MassMutual Tower 38 Gloucester Road Wanchai Hong Kong 21st October, 2005

To the Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION

FORMATION OF A JOINT VENTURE

INTRODUCTION

On 3rd October, 2005, the Company announced that on 27th September, 2005, the Company, Sino Land and Nan Fung entered into a joint venture through the formation of Bestwise, a new joint venture company incorporated in the British Virgin Islands. Bestwise is owned as to 25% by Fine Famous (an indirect wholly-owned subsidiary of the Company), 50% by King Chance (a direct wholly-owned subsidiary of Sino Land) and 25% by Glory Top (a direct wholly-owned subsidiary of Nan Fung). The purpose of Bestwise is to own and develop the Lands into residential and retail properties through its wholly-owned subsidiaries, Best Profit and Union Empire.

The formation of Bestwise constitutes a discloseable transaction of the Company under the Listing Rules. The purpose of this circular is to provide you with further information on the formation of Bestwise.

1

LETTER FROM THE BOARD

THE JOINT VENTURE ENTITY - BESTWISE

1. Certain Corporate Information

Date of incorporation: 5th September, 2005

Issued share capital:

US$100 divided into 100 shares of US$1.00 each. 25 shares were allotted and issued at par for cash to Fine Famous, 50 shares were allotted and issued at par for cash to King Chance and 25 shares were allotted and issued at par for cash to Glory Top, in each case on 27th September, 2005

• Constitution of the board of directors of Bestwise:

a total of eight directors of Bestwise, of which two are appointed by the Company, four are appointed by Sino Land and two are appointed by Nan Fung, or such number of directors as agreed by the JV Partners in proportion to their respective shareholdings in Bestwise

2. Principal Activity

Bestwise is an investment holding company. It is a joint venture entity formed by Fine Famous, King Chance and Glory Top, being the wholly-owned subsidiaries of the Company, Sino Land and Nan Fung respectively to undertake the Projects on a 25/50/25 basis, through its two wholly-owned subsidiaries, Best Profit and Union Empire.

On 27th September, 2005, Best Profit and Union Empire, two direct wholly-owned subsidiaries of Bestwise, successfully bid for the Hoi Ting Road Land and the Junction of Hoi Wang Road and Hoi Ting Road Land from the Government for the bidding price of HK$3.19 billion and HK$2.73 billion respectively.

The deposit of the Land Costs in the aggregate amount of HK$100 million was paid by Best Profit and Union Empire on 27th September, 2005 and the balance of the Land Costs will be payable by Best Profit and Union Empire respectively on or before 25th October, 2005.

3. Funding Requirements

The JV Partners shall severally procure to make available to Bestwise and its subsidiaries all fundings for the Projects on a 25/50/25 basis. Future fundings of Bestwise and its subsidiaries will be by way of external borrowing and the contributions from the JV Partners in proportion to their respective shareholdings in Bestwise. The Company will fund its contribution by internal resources and bank borrowing.

As at the Latest Practicable Date, the Company has not committed to any funding amount other than 25% of the Land Costs. An initial amount of HK$25 million of such capital commitment has been contributed by the Company by cash advance to Bestwise for payment of the deposit of the Land Costs. The balance of such capital commitment is expected to be contributed by the Company by cash advance(s) to Bestwise and/or corporate guarantee for the bank borrowings of Bestwise Group for the Projects. The Company understands that Sino Land and Nan Fung have also contributed and/or will contribute the Land

2

LETTER FROM THE BOARD

Costs by way of cash advance(s) to Bestwise and/or corporate guarantee for the bank borrowings of Bestwise Group for the Projects. The Company will monitor the amount of the total commitment from time to time and comply with any additional requirements under the Listing Rules, where necessary. As at the Latest Practicable Date, the total capital commitment of the Company in respect of the future costs for the Projects has not been confirmed.

4. Profit Sharing

It is expected that any profit of the Projects is to be ultimately shared by the JV Partners pro-rated on a 25/50/25 basis.

5. Joint Venture Agreement

It is intended that a joint venture agreement incorporating the material terms set out above will be entered into between the JV Partners as soon as practicable. In the event that the provisions of such joint venture agreement are inconsistent with the material terms set out above, the Company will make a further announcement and comply with the requirements of the Listing Rules, where necessary, as soon as practicable after signing of the joint venture agreement. As at the Latest Practicable Date, the joint venture agreement in respect of Bestwise has not been signed by the JV Partners yet.

The Directors, including the independent non-executive Directors, consider that the terms for the formation of Bestwise are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

REASONS FOR THE JOINT VENTURE

One of the main business areas of the Group is property development and investment in Hong Kong. The formation of a joint venture for the purpose of undertaking the Projects is a continuation of the Group's principal activity in Hong Kong with other business partners.

The addition of the Lands to the landbank of the Group for development into residential and retail properties is consistent with one of the core business strategies of the Group. The Lands will be developed into luxurious residential and retail complex with fully-fledged club-house, amenity facilities and car park spaces.

INFORMATION ON THE GROUP

The principal activities of the Group are property development and trading, property leasing, money lending and securities investment, investment holding and brokerage.

INFORMATION ON SINO LAND AND NAN FUNG

TST Properties is the holding company of Sino Land. Both TST Properties and Sino Land are investment holding companies and their principal businesses include property development and investment, share investment and dealing, financing and management services. Sino Land Group has previously entered into joint ventures for land development projects with the Group.

The principal businesses of Nan Fung are investment holding, financing and property investment. Nan Fung is a company beneficially owned by Mr. Chen Din Hwa.

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LETTER FROM THE BOARD

FINANCIAL EFFECTS OF THE FORMATION OF BESTWISE

As at the Latest Practicable Date, it is expected that the contribution of the Land Costs by the Company for the Projects will not have any effect on the assets and liabilities of the Group as the reduction in cash for the Land Costs will be offset by the corresponding increase in the investment of the Group in Bestwise and any corporate guarantee provided by the Group for the bank borrowings of Bestwise Group will only constitute contingent liabilities of the Group. It is also expected that the formation of Bestwise will not have any significant effect on the earnings of the Group immediately.

GENERAL

Based on the above information provided by Sino Land and Nan Fung and to the best of the Directors' knowledge, information and belief after having made all reasonable enquiries, each of Sino Land, the holding company of Sino Land, Nan Fung and the ultimate beneficial owner of Nan Fung is an independent third party and is not a connected person (as defined in the Listing Rules) of the Company and not connected with the directors, substantial shareholders and chief executives of the Company or its subsidiaries and their respective associates (as defined in the Listing Rules).

Additional information is also set out in the Appendix to this circular for your information.

Yours faithfully, On behalf of the Board Thomas Lau, Luen-hung Chairman

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement contained herein misleading.

2. INTERESTS OF DIRECTORS

As at the Latest Practicable Date, the interests and short positions of the Directors, 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 are 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 he is taken or deemed to have under such provisions of the SFO) or are required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein or are required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers of the Listing Rules to be notified to the Company and the Stock Exchange were as follows:

Long Positions

(a) The Company

Name of Director Capacity Joseph Lau, Luen-hung (“Mr. Joseph Lau”) Other interests Other interests Thomas Lau, Luen-hung (“Mr. Thomas Lau”) Other interests	Number of shares Percentage of issued share capital 275,143,456 1,000,000,000 (Note 1) (Note 2) 13.21% 48.00% 1,275,143,456 61.21% 199,207,187 (Note 3) 9.56%

Notes:

1. These shares were indirectly owned by a discretionary trust of which Mr. Joseph Lau was the founder and certain family members of Mr. Joseph Lau were eligible beneficiaries.

2. These shares were held by a unit trust of which Mr. Joseph Lau was one of the unit holders. The rest of the units in the unit trust were held by a discretionary trust of which Mr. Joseph Lau was the founder and certain family members of Mr. Joseph Lau were eligible beneficiaries.

3. These shares were indirectly owned by a discretionary trust of which Mr. Thomas Lau and his certain family members were eligible beneficiaries.

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GENERAL INFORMATION

APPENDIX

(b) Associated Corporations

				Percentage of
	Name of		Number of	issued share
Name of company	Director	Capacity	shares	capital
Chi Cheung Investment	Mr. Joseph Lau	Interest in	209,811,186_(Note 1)_	61.93%
Company, Limited		controlled
(“Chi Cheung”)		corporation
G-Prop (Holdings)	Mr. Joseph Lau	Interest in	397,858,761_(Note 2)_	50.10%
Limited (“G-Prop”)		controlled
		corporation

Notes:

1. Mr. Joseph Lau by virtue of his 61.21% interest in the issued share capital of the Company as disclosed in paragraph (a) above, was deemed to be interested in 209,811,186 shares of Chi Cheung held directly by Billion Up Limited, a wholly-owned subsidiary of Lucky Years Ltd. which in turn was the wholly-owned subsidiary of the Company.

2. Mr. Joseph Lau by virtue of his 61.21% interest in the issued share capital of the Company as disclosed in paragraph (a) above, was deemed to be interested in 397,858,761 shares of G-Prop under the provisions of the SFO. The Company was interested in 397,858,761 shares of G-Prop of which 170,000,000 shares, 113,818,911 shares, 37,162,165 shares and 76,877,685 shares were issued shares respectively held by Million Point Limited (“Million Point”), Paul Y. Holdings Company Limited (“Paul Y”), Great Empire International Ltd. (“Great Empire”) and Luckpoint Investment Limited (“Luckpoint”).

The Company was deemed to be interested in the 170,000,000 shares of G-Prop by virtue of the SFO as the Company owned the entire issued share capital of Chinese Estates, Limited, which owned the entire issued share capital of Cosmos Success Limited which in turn owned the entire issued share capital of Million Point.

The Company was also deemed to be interested in the 113,818,911 shares of G-Prop by virtue of the SFO as the Company owned the entire issued share capital of Paul Y.

The Company was also deemed to be interested in the 37,162,165 shares of G-Prop by virtue of the SFO as the Company owned the entire issued share capital of Paul Y, which owned the entire issued share capital of Goldstance Group Limited, which in turn owned the entire issued share capital of Great Empire.

The Company was also deemed to be interested in the 76,877,685 shares of G-Prop by virtue of the SFO as the Company owned the entire issued share capital of China Entertainment and Land Investment Company, Limited, which in turn owned the entire issued share capital of Luckpoint.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors and chief executive of the Company had any interests and 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 are 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 he is taken or deemed to have under such provisions of the SFO) or are required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein or are required pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers of the Listing Rules to be notified to the Company and the Stock Exchange.

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GENERAL INFORMATION

APPENDIX

3. INTERESTS OF SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as is known to any Director or chief executive of the Company, the following persons (other than a Director or the chief executive of the Company) had an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, 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:

Long Positions

(a) The Company

				Percentage of	Percentage of
Name of				issued share
shareholder	Capacity	Number of shares		capital
GZ Trust Corporation	Trustee and beneficiary	1,000,000,000 (Note 1)		48.00%
	of a trust
	Trustee and interest in	275,143,456 (Note 2)		13.21%
	controlled corporation
		1,275,143,456		61.21%
Global King Ltd.	Trustee	1,000,000,000_(Note 1)_		48.00%
Joseph Lau Luen Hung	Beneficial owner	275,143,456_(Note 2)_		13.21%
Investments Limited
Ip, Sok-wun	Founder of	199,207,187_(Note 3)_		9.56%
	discretionary trust
J. P. Morgan Trust	Trustee and interest in	199,207,187_(Note 4)_		9.56%
Company (Bahamas)	controlled corporation
Limited
Sunny Trend Limited	Beneficial owner	199,207,187_(Note 4)_		9.56%
Li Ka-shing	Founder of	174,660,000_(Notes 5 & 6)_		8.38%
	discretionary trusts and
	interest of controlled
	corporations
Li Ka-Shing Unity	Trustee and beneficiary	174,660,000_(Notes 5 & 6)_		8.38%
Trustcorp Limited	of a trust

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GENERAL INFORMATION

APPENDIX

			Percentage of
Name of			issued share
shareholder	Capacity	Number of shares	capital
Li Ka-Shing Unity	Trustee and beneficiary	174,660,000_(Notes 5 & 6)_	8.38%
Trustee Corporation	of a trust
Limited
Li Ka-Shing Unity	Trustee	174,660,000_(Notes 5 & 6)_	8.38%
Trustee Company
Limited
Cheung Kong	Interest of controlled	174,660,000_(Notes 5 & 6)_	8.38%
(Holdings) Limited	corporations
Hutchison Whampoa	Interest of controlled	174,660,000_(Note 5)_	8.38%
Limited	corporations
Hutchison International	Interest of a controlled	174,660,000_(Note 5)_	8.38%
Limited	corporation
Primetek Holdings	Beneficial owner	174,660,000_(Note 5)_	8.38%
Limited

Notes:

1. GZ Trust Corporation as trustee of a discretionary trust held units in a unit trust of which Global King Ltd. was the trustee and therefore was regarded as interested in the same parcel of shares held by Global King Ltd. These shares were the same parcel of 1,000,000,000 shares of the Company referred to in “Other Interests” of Mr. Joseph Lau under the section headed “Interests of Directors” as disclosed in paragraph 2(a) above. Mr. Joseph Lau is a director of Global King Ltd.

2. GZ Trust Corporation as trustee of another discretionary trust held the entire issued share capital of Joseph Lau Luen Hung Investments Limited and therefore was regarded as interested in the same parcel of shares held by Joseph Lau Luen Hung Investments Limited. These shares were the same parcel of 275,143,456 shares of the Company referred to in “Other Interests” of Mr. Joseph Lau under the section headed “Interests of Directors” as disclosed in paragraph 2(a) above. Mr. Joseph Lau is a director of Joseph Lau Luen Hung Investments Limited.

3. These shares were indirectly owned by a discretionary trust of which Ms. Ip, Sok-wun was the founder. These shares were the same parcel of the shares referred to in “Other Interests” of Mr. Thomas Lau under the section headed “Interests of Directors” as disclosed in paragraph 2(a) above.

4. J. P. Morgan Trust Company (Bahamas) Limited as trustee of a discretionary trust owned the entire issued share capital of Sunny Trend Limited. By virtue of the SFO, J. P. Morgan Trust Company (Bahamas) Limited was deemed to have interest in the 199,207,187 shares of the Company held by Sunny Trend Limited. These shares were the same parcel of shares referred to in “Other Interests” of Mr. Thomas Lau under the section headed “Interests of Directors” as disclosed in paragraph 2(a) above and note 3 hereof. Mr. Thomas Lau is a director of Sunny Trend Limited.

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GENERAL INFORMATION

APPENDIX

1. Primetek Holdings Limited (“Primetek”) is a wholly-owned subsidiary of Hutchison International Limited (“HIL”), which in turn is a wholly-owned subsidiary of Hutchison Whampoa Limited (“HWL”). By virtue of the SFO, HWL and HIL are deemed to be interested in the 174,660,000 shares of the Company held by Primetek.

2. Li Ka-Shing Unity Holdings Limited, of which each of Mr. Li Ka-shing, Mr. Li Tzar-kuoi, Victor and Mr. Li Tzar-kai, Richard is interested in one-third of the entire issued share capital, owns the entire issued share capital of Li Ka-Shing Unity Trustee Company Limited (“TUT1”). TUT1 as trustee of The Li Ka-Shing Unity Trust (“UT1”), together with certain companies which TUT1 as trustee of UT1 is entitled to exercise or control the exercise of more than one-third of the voting power at their general meetings, hold more than one-third of the issued share capital of Cheung Kong (Holdings) Limited (“CKH”). Subsidiaries of CKH are entitled to exercise or control the exercise of more than one-third of the voting power at the general meetings of HWL.

In addition, Li Ka-Shing Unity Holdings Limited also owns the entire issued share capital of Li Ka-Shing Unity Trustee Corporation Limited (“TDT1”) as trustee of The Li Ka-Shing Unity Discretionary Trust (“DT1”) and Li Ka-Shing Unity Trustcorp Limited (“TDT2”) as trustee of another discretionary trust (“DT2”). Each of TDT1 and TDT2 holds units in UT1.

By virtue of the SFO, each of Mr. Li Ka-shing, being the settlor and may being regarded as a founder of DT1 and DT2 for the purpose of the SFO, TDT1, TDT2, TUT1 and CKH was deemed to be interested in the 174, 660,000 shares of the Company held by Primetek.

(b) Subsidiaries of the Company

		Percentage of
		issued share
Name of subsidiary	Name of shareholder	capital
Dollar Union Limited	Steamroller Limited	25%
Modern City Investment Limited	Rothschild Investments Limited	25%
Conduit Road Development Limited	Rush Will Limited	30%
Konshing Enterprises Limited	Earlway International & Development Ltd.	49%
G-Prop (Holdings) Limited	Koga Limited (Note)	4.78%
(“G-Prop’’)	Hutchison International Limited_(Note)_	7.92%

Note: These shares comprised 62,899,924 shares beneficially owned by Hutchison International Limited (“HIL”) and 37,987,988 shares beneficially owned by Koga Limited (“Koga”).

HIL is a wholly-owned subsidiary of Hutchison Whampoa Limited (“HWL”). By virtue of the SFO, HWL was taken to have an interest in the same parcel of such 62,899,924 shares which HIL was interested in.

Koga is a wholly-owned subsidiary of Cheung Kong Infrastructure (BVI) Limited, which in turn is a wholly-owned subsidiary of Cheung Kong Infrastructure Holdings Limited. Cheung Kong Infrastructure Holdings Limited is a subsidiary of Hutchison Infrastructure Holdings Limited, which in turn is a wholly-owned subsidiary of HIL. By virtue of the SFO, each of HIL and HWL was taken to have an interest in the same parcels of such 37,987,988 shares which Koga was interested in.

9

GENERAL INFORMATION

APPENDIX

Li Ka-Shing Unity Holdings Limited, of which each of Mr. Li Ka-shing, Mr. Li Tzar-kuoi, Victor and Mr. Li Tzar-kai, Richard was interested in one-third of the entire issued share capital, owned the entire issued share capital of Li Ka-Shing Unity Trustee Company Limited (“TUT1”). TUT1 as trustee of The Li Ka-Shing Unity Trust (“UT1”), together with certain companies which TUT1 as trustee of UT1 is entitled to exercise or control the exercise of more than one-third of the voting power at their general meetings, held more than one-third of the issued share capital of Cheung Kong (Holdings) Limited (“CKH”). Certain subsidiaries of CKH were entitled to exercise or control the exercise of more than one-third of the voting power at the general meetings of HWL. In addition, Li Ka-Shing Unity Holdings Limited also owned the entire issued share capital of Li Ka-Shing Unity Trustee Corporation Limited (“TDT1”) as trustee of The Li Ka-Shing Unity Discretionary Trust (“DT1”) and Li Ka-Shing Unity Trustcorp Limited (“TDT2”) as trustee of another discretionary trust (“DT2”). Each of TDT1 and TDT2 holds units in UT1. Mr. Li Ka-shing was the settlor of each of DT1 and DT2 and may be regarded as a founder of each of DT1 and DT2 for the purpose of the SFO. By virtue of the SFO, each of Mr. Li Ka-shing, TDT1, TDT2, TUT1 and CKH was deemed to be interested in the 100,887,912 shares in G-Prop which HWL was interested in.

Save as disclosed above, as at the Latest Practicable Date, so far as is known to any Director or chief executive of the Company, no persons (other than a Director or the chief executive of the Company) has an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, 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.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had a service contract with the Company or any of its subsidiaries which is not determinable by the Group within one year without payment of compensation, other than statutory compensation.

5. COMPETING BUSINESS

Both of the executive Directors have personal interests in private companies engaged in property development and investment in Hong Kong, securities investment and money lending. As such, they were regarded as being interested in such businesses, which compete or may compete with the Group. Nevertheless, given the size of such investments when compared with the size of operations and the investment portfolio of the Group, investments in such ventures were considered immaterial as compared with the business interests of the Company. Given that the businesses of the Group and the private companies are independently operated by different management teams, the Directors consider that the Company is capable of carrying on its business independently of and at arm's length from these competing businesses. Both of the executive Directors do not currently have any intention to inject such interests into the Group.

6. MATERIAL LITIGATION

As at the Latest Practicable Date, so far as known to the Directors, there is no litigation or claims of material importance pending or threatened against any member of the Group.

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GENERAL INFORMATION

APPENDIX

7. MISCELLANEOUS

• (a) Mr. Lam Kwong-wai, fellow member of The Association of Chartered Certified Accountants (FCCA), is the company secretary and qualified accountant of the Company.

• (b) The registered office of the Company is at Canon's Court, 22 Victoria Street, Hamilton HM 12, Bermuda. The branch share registrar of the Company in Hong Kong and the transfer office is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong.

• (c) The English text of this circular shall prevail over the Chinese text in the case of inconsistency.

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