Pacific Basin Shipping Limited — Proxy Solicitation & Information Statement 2010

Feb 9, 2010

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take 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.

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

If you have sold all your shares in Rising Development Holdings Limited ( ) (the “Company”), you should at once hand this circular to the purchaser or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

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RISING DEVELOPMENT HOLDINGS LIMITED ( )[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1004)

REFRESHMENT OF GENERAL MANDATE

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

A letter of recommendation from the independent board committee of the Company is set out on page 9 of this circular and a letter of advice from Guangdong Securities Limited containing its advice to the independent board committee and the independent shareholders of the Company is set out on pages 10 to 15 of this circular.

A notice convening a special general meeting of the Company (“SGM”) to be held at Rooms 2004-5, 20th Floor, World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong, at 3:00 p.m. on Monday, 1 March 2010 is set out on pages 16 to 18 of this circular. Whether or not you intend to attend the SGM, you are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return it to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as practicable but in any event not later than 48 hours before the time appointed for holding the SGM 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 SGM should you so wish.

• For identification purpose only

10 February 2010

CONTENTS

		Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
**Letter from the **	Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
**Letter from the **	Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . .	9
Letter from Guangdong Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		10
Notice of SGM	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

– i –

DEFINITIONS

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

• ”Annual General Meeting”

• the annual general meeting of the Company held on 13 August 2009

• “April 08 Convertible Notes”

• the convertible notes with a nominal value of HK$837 million issued on 11 April 2008 to the vendors of Shanxi Jiuquan

• “associate(s)”

• shall have the meaning ascribed to it under the Listing Rules

• “Board” the board of Directors

• “Company”

• Rising Development Holdings Limited ( *), a company incorporated in Bermuda with

• limited liability and whose securities are listed on the main board of the Stock Exchange

• “Current General Mandate”

• the general mandate approved and granted to the Directors to allot and issue new Shares not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing the resolution, i.e. the Annual General Meeting

• “Deeds of Settlement”

• the three deeds of settlement entered into between the Company and each of the April 08 Convertible Notes holders respectively whereby the Company was to issue and deliver to each of the April 08 Convertible Notes holders the New Convertible Notes in the aggregate principal amount of HK$744.93 million with a term of 3 years

• “Director(s)”

• the director(s) of the Company

• “Group” the Company and its subsidiaries

• “HK$”

• Hong Kong dollar(s), the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the PRC

– 1 –

DEFINITIONS

• “Independent Board Committee”

• “Independent Financial Adviser” or “Guangdong Securities”

• “Independent Shareholder(s)”

• “Interim Report”

• “Latest Practicable Date”

• “Listing Rules”

• “New Convertible Notes”

• “New General Mandate”

• “Refreshment of General Mandate”

• “SFO”

• an independent committee of the Board comprising all of the independent non-executive Directors formed for the purpose of advising the Independent Shareholders in respect of the Refreshment of General Mandate

• Guangdong Securities Limited, a licensed corporation under the SFO to carry out type 1 (dealing in securities), type 2 (dealing in futures contracts), type 4 (advising on securities), type 6 (advising on corporate finance) and type 9 (asset management) regulated activities

• Shareholders other than any controlling shareholders and their associates or, where there are no controlling shareholders, the Directors (excluding independent nonexecutive Directors) and the chief executive of the Company and their respective associates

• unaudited interim report of the Group for the six months ended 30 September 2009

• 8 February 2010, being the latest practicable date prior to the printing of this circular for ascertaining certain information for inclusion in this circular

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

• the zero coupon convertible notes due 2012 in the aggregate principal amount of HK$744.93 million which were issued by the Company to the April 08 Convertible Notes holders

• the new mandate proposed to be sought at the SGM to authorize the Directors to allot and issue new Shares not exceeding 20% of the issued share capital of the Company as at the date of the SGM

• the proposed refreshment of the Current General Mandate and grant of the New General Mandate

• the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

– 2 –

DEFINITIONS

“SGM” the special general meeting of the Company to be held at Rooms 2004-5, 20th Floor, World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong on Monday, 1 March 2010 at 3:00 p.m. for the purpose of considering and, if thought fit, approving, among others, the Refreshment of General Mandate

• “Shanxi Jiuquan” (Shanxi Jiuquan Mining Company Limited*), a company incorporated in the PRC

• “Share(s)” the ordinary share(s) with a nominal value of HK$0.01 each in the share capital of the Company

• “Shareholder(s)” the holder(s) of the Share(s)

• “Stock Exchange” The Stock Exchange of Hong Kong Limited “Very Substantial Acquisition” the acquisition by the Group of the entire issued share capital of Oriental Harvest Development Limited which indirectly own a 80% interest in Shanxi Jiuquan, for an aggregate consideration of HK$1,137 million

• “%” per cent.

* For identification purpose only

In the event of any inconsistency, the English text of this circular shall prevail over the Chinese text.

– 3 –

LETTER FROM THE BOARD

RISING DEVELOPMENT HOLDINGS LIMITED

(

)[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1004)

Executive Directors Mr. Lai Leong (Chairman & Chief Executive Officer) Mr. Lee Yuk Lun (Deputy Chairman) Mr. Kong Shan, David

Independent Non-executive Directors Mr. Fok Ho Yin, Thomas Mr. Tso Hon Sai, Bosco Mr. Tsui Ching Hung

Registered Office Clarendon House 2 Church Street Hamilton HM11 Bermuda

Principal Place of Business Rooms 2004-5, 20th Floor World Trade Centre 280 Gloucester Road Causeway Bay, Hong Kong

10 February 2010

To Shareholders,

Dear Sir or Madam,

REFRESHMENT OF GENERAL MANDATE

INTRODUCTION

The purpose of this circular is to provide you with further information relating to (i) the Refreshment of General Mandate; (ii) the recommendation of the Independent Board Committee to the Independent Shareholders; (iii) a letter of advice from Guangdong Securities to the Independent Board Committee and the Independent Shareholders in relation to the Refreshment of General Mandate; and (iv) the notice of the SGM to be convened and held for the purpose of considering and, if thought fit, approving the resolution to implement the proposal for the Refreshment of General Mandate.

* For identification purpose only

– 4 –

LETTER FROM THE BOARD

REFRESHMENT OF GENERAL MANDATE

The Board proposes to refresh the Current General Mandate for the Directors to allot and issue new Shares not exceeding 20% of the nominal amount of the issued share capital of the Company as at the date of the SGM. The New General Mandate will, if granted, remain effective until the earliest of: (i) the conclusion of the next annual general meeting of the Company; (ii) the expiration of the period within which the next annual general meeting of the Company is required to be held by Bermuda law or Bye-laws; and (iii) its revocation or variation by an ordinary resolution of Shareholders in a general meeting of the Company.

Background of the Refreshment of General Mandate

At the Annual General Meeting, Shareholders approved, among other things, an ordinary resolution to grant to the Directors the Current General Mandate to allot and issue up to 29,090,720 new Shares.

As at the Latest Practicable Date, the Current General Mandate has not been utilised and has not been refreshed since it was granted.

Reference is made to the Company’s announcement and circular of 10 January 2008 and 26 February 2008 respectively in relation to the Very Substantial Acquisition. The consideration of HK$1,137 million was satisfied as to HK$300 million by cash and as to HK$837 million by the issue of the April 08 Convertible Notes. Upon full conversion of the April 08 Convertible Notes, a total of 2,989,285,700 new Shares would have been issued by the Company. On 11 April 2008, the Group completed the Very Substantial Acquisition. As announced by the Company on 19 May 2009 and reference is also made to the Company’s circular of 27 May 2009, the Company entered into the Deeds of Settlement with the April 08 Convertible Notes holders whereby the Company was to issue and deliver to each of the April 08 Convertible Notes holders the New Convertible Notes in the aggregate principal amount of HK$744.93 million with a term of 3 years. Upon full conversion of the New Convertible Notes, a total of 1,241,550,000 new Shares would have been issued by the Company. Pursuant to the Deeds of Settlement, each of the April 08 Convertible Notes holders would be fully and finally discharged and thereafter each of the April 08 Convertible Notes holders would have no recourse against the Company.

Subsequent to the Annual General Meeting and up to the Latest Practicable Date, a total of 1,240,775,000 new Shares have been issued upon the conversion of part of the New Convertible Notes. As a result thereof, the issued share capital of the Company has been increased from a total of 145,453,600 Shares as at the date of the Annual General Meeting to 1,386,228,600 Shares as at the Latest Practicable Date, an increase of approximately 853%.

– 5 –

LETTER FROM THE BOARD

Reasons for the Refreshment of General Mandate

In line with the business plans of the Group (reference is made to the management discussion and analysis as set out in the Interim Report), the Group will continue to identify, explore and evaluate new businesses and investment opportunities and consider investing in projects which may be of good profit potential and/or bring long-term benefits to the Group and its Shareholders. To facilitate the Group’s acquisition of suitable investments and to further enhance the Group’s working capital, if and when considered necessary, the Group will consider raising additional funds through various means, which shall include the issue of new Shares and/or debt financing. Further announcements will be made by the Company in compliance with the requirements of the Listing Rules.

With the New General Mandate, the Company will have more flexibility in raising additional funds for the use of the Group as and when it is considered necessary.

As at the Latest Practicable Date, the total number of Shares in issue was 1,386,228,600 Shares. Assuming no further new Shares are to be issued and/or repurchased by the Company between the Latest Practicable Date and the date of the SGM, the New General Mandate will enable the Board to issue and allot 277,245,720 new Shares.

SGM

Pursuant to Rules 13.36(4) of the Listing Rules, the grant of the New General Mandate is subject to the approval of the Independent Shareholders by way of a poll at the SGM with the controlling Shareholders and their associates or, where there are no controlling Shareholders, the Directors (excluding the independent non-executive Directors) and the chief executive of the Company and their respective associates abstain from voting in favour.

As at the Latest Practicable Date, Oriental Day International Limited (a company wholly owned by Mr. Lai Leong, the chairman of the Company), being the controlling shareholder of the Company, held a total of 820,757,600 Shares which represented approximately 59.21% of the issued share capital of the Company. Therefore, Oriental Day International Limited and its associates shall abstain from voting in favour of the resolution to be proposed at the SGM to approve the grant of the New General Mandate. The voting shall be taken by way of a poll.

The SGM will be convened and held to consider and, if thought fit, to approve the ordinary resolution to approve the grant of the New General Mandate.

A notice convening the SGM to be held at Rooms 2004-5, 20th Floor, World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong on Monday, 1 March 2010, at 3:00 p.m. is set out on pages 16 to 18 of this circular.

– 6 –

LETTER FROM THE BOARD

A form of proxy for use at the SGM is accompanied with this circular. Whether or not you intend to attend the SGM, you are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return it to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as practicable but in any event not later than 48 hours before the time appointed for holding the SGM 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 SGM should you so wish.

INDEPENDENT ADVICE

The Independent Board Committee comprising Mr. Fok Ho Yin, Thomas, Mr. Tso Hon Sai, Bosco and Mr. Tsui Ching Hung all of them being the independent non-executive Directors, has been formed to advise the Independent Shareholders, and Guangdong Securities has been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders on the grant of the New General Mandate.

RECOMMENDATION

The Directors are of the opinion that the grant of the New General Mandate is in the interests of the Company and Shareholders as a whole. Accordingly, the Directors recommend the Independent Shareholders to vote in favour of the resolution set out in the notice of the SGM contained herein. In addition, your attention is drawn to the letter from the Independent Board Committee as set out on page 9 of this circular which contains its recommendation to the Independent Shareholders in relation to the grant of the New General Mandate, which was given after the Independent Board Committee has considered the advice of Guangdong Securities. The letter from Guangdong Securities is set out on pages 10 to 15 of this circular containing the principal factors and reasons it has taken into consideration and its recommendation to the Independent Board Committee and the Independent Shareholders in relation to the grant of the New General Mandate.

RESPONSIBILITY STATEMENT

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 that, 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 in this circular misleading.

– 7 –

LETTER FROM THE BOARD

CONSENT

Guangdong Securities has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter set out therein and reference to its name in the form and context in which they appear respectively.

Yours faithfully,

For and on behalf of the Board

Rising Development Holdings Limited Mr. Lai Leong Chairman

– 8 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

The following is the text of a letter of recommendation from the Independent Board Committee to the Independent Shareholders in relation to the grant of the New General Mandate for the purpose of incorporation in this circular.

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RISING DEVELOPMENT HOLDINGS LIMITED ( )[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1004)

10 February 2010

To the Independent Shareholders

Dear Sir or Madam,

REFRESHMENT OF GENERAL MANDATE

We refer to the circular of the Company dated 10 February 2010 (the “ Circular ”) of which this letter forms part. Unless the context specifies otherwise, capitalised terms used herein have the same meanings as defined in the Circular.

We have been appointed by the Board to advise the Independent Shareholders in connection with the Refreshment of General Mandate. Guangdong Securities has been appointed as the Independent Financial Adviser to advise us and you in this respect.

Having taken into account the principal reasons and factors considered by and the advice of Guangdong Securities as set out in its letter of advice to us and you on pages 10 to 15 of the Circular, we are of the opinion that the grant of the New General Mandate is in the interests of the Company and Shareholders as a whole and the terms of which are fair and reasonable so far as the Company and the Independent Shareholders are concerned. Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the SGM to approve the grant of the New General Mandate.

Yours faithfully,

For and on behalf of the

Independent Board Committee

Mr. Fok Ho Yin, Thomas

Mr. Tso Hon Sai, Bosco Mr. Tsui Ching Hung

Independent non-executive Directors

* For identification purpose only

– 9 –

LETTER FROM GUANGDONG SECURITIES

Set out below is the text of a letter received from Guangdong Securities, the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders regarding the Refreshment of General Mandate for the purpose of inclusion in this circular.

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Units 2505-06, 25/F. Low Block of Grand Millennium Plaza 181 Queen’s Road Central Hong Kong

10 February 2010

• To: The independent board committee and the independent shareholders of Rising Development Holdings Limited

Dear Sirs,

REFRESHMENT OF GENERAL MANDATE

INTRODUCTION

We refer to our appointment as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in connection with the Refreshment of General Mandate, details of which are set out in the letter from the Board (the “ Board Letter ”) contained in the circular dated 10 February 2010 issued by the Company to the Shareholders (the “ Circular ”), of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context requires otherwise.

As at the Latest Practicable Date, only 29,090,720 Shares could be issued under the Current General Mandate, which was granted to the Directors at the Annual General Meeting. Therefore, the Board proposes to seek approval of the Independent Shareholders for the grant of the New General Mandate such that the Directors will be granted the authority to issue, allot and deal with new Shares not exceeding 20% of the total issued share capital of the Company as at the date of passing the relevant resolution(s) at the SGM. Pursuant to Rule 13.36(4) of the Listing Rules, the grant of the New General Mandate requires the approval of the Independent Shareholders at the SGM at which any of the controlling Shareholders (as defined in the Listing Rules) and their associates or, where there are no controlling Shareholder, the Directors (excluding the independent non-executive Directors), the chief executive of the Company and their respective associates are required to abstain from voting in favour of the resolution(s) proposed for the approval of such grant, and under Rule 13.39(4)(b) of the Listing Rules, any vote of the Shareholders at a general meeting must be taken by way of poll. As at the Latest Practicable Date, Oriental Day International Limited (a company which is wholly owned by Mr. Lai Leong, the chairman of the Company) was the controlling Shareholder. Accordingly, Oriental Day International Limited and its associates shall abstain from voting in favour of the resolution(s) to be proposed at the SGM to approve the grant of the New General Mandate.

– 10 –

LETTER FROM GUANGDONG SECURITIES

An Independent Board Committee comprising Mr. Fok Ho Yin, Thomas, Mr. Tso Hon Sai, Bosco and Mr. Tsui Ching Hung (all being independent non-executive Directors) has been established to advise the Independent Shareholders on the grant of the New General Mandate. We, Guangdong Securities Limited, have been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this respect.

BASIS OF OUR OPINION

In formulating our advice and recommendation to the Independent Board Committee and the Independent Shareholders, we have relied on the statements, information, opinions and representations contained or referred to in the Circular and the information and representations as provided to us by the Directors. We have assumed that all information and representations that have been provided by the Directors, for which they are solely and wholly responsible, are true, complete and accurate in all material respects at the time when they were made and continue to be so as at the Latest Practicable Date. We have also assumed that all statements of belief, opinion, expectation and intention made by the Directors in the Circular were reasonably made after due enquiries and careful considerations. We have no reason to suspect that any material facts or information have been withheld or to doubt the truth, accuracy and completeness of the information and facts contained in the Circular, or the reasonableness of the opinions expressed by the Company, its advisers and/or the Directors, which have been provided to us. We consider that we have taken sufficient and necessary steps on which to form a reasonable basis and an informed view for our recommendation in compliance with Rule 13.80 of the Listing Rules.

The Directors have collectively and individually accepted full responsibility for the accuracy of the information contained in the Circular and have confirmed, having made all reasonable enquiries, which to the best of their knowledge and belief, there are no other facts the omission of which would make any statement in the Circular misleading.

We consider that we have been provided sufficient information to reach an informed view and to provide a reasonable basis for our recommendation. We have not, however, conducted any independent in-depth investigation into the business and affairs of the Company, or its subsidiaries or associates, nor have we considered the taxation implication on the Group or the Shareholders as a result of the Refreshment of General Mandate. In addition, we have no obligation to update this opinion to take into account events occurring after the issue of this letter. Nothing contained in this letter should be construed as a recommendation to hold, sell or buy any Shares or any other securities of the Company.

Lastly, where information in this letter has been extracted from published or otherwise publicly available sources, the sole responsibility of Guangdong Securities is to ensure that such information has been correctly extracted from the relevant sources.

– 11 –

LETTER FROM GUANGDONG SECURITIES

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion in respect of the grant of the New General Mandate, we have taken into consideration the following principal factors and reasons:

(1) Background of the Refreshment of General Mandate

The Group is principally engaged in investment holding and trading in securities, manufacture and sale of fur garments, trading of fur skins and business of mining natural resources.

The Directors were authorised to issue and allot up to 29,090,720 new Shares under the Current General Mandate which was granted to the Directors at the Annual General Meeting.

With reference to the Board Letter, Subsequent to the Annual General Meeting and up to the Latest Practicable Date, a total of 1,240,775,000 new Shares have been issued upon the conversion of part of the New Convertible Notes. As a result thereof, the issued share capital of the Company was increased by approximately 853% from a total of 145,453,600 Shares as at the date of the Annual General Meeting to 1,386,228,600 Shares as at the Latest Practicable Date. Although no new Share was issued under the authority of the Current General Mandate, the 29,090,720 new Shares which could be issued under the Current General Mandate only represented approximately 2.10% of the issued share capital of the Company as at the Latest Practicable Date.

As aforementioned, as at the Latest Practicable Date, the Company had 1,386,228,600 Shares in issue. On the basis that no Share would be issued and/or repurchased by the Company from the Latest Practicable Date up to the date of the SGM, the grant of the New General Mandate would allow the Directors to issue, allot and deal with up to 277,245,720 new Shares, representing 20% of the total issued share capital of the Company.

Given the above, the Board proposes to seek approval of the Independent Shareholders for the grant of the New General Mandate such that the Directors will be granted the authority to issue, allot and deal with new Shares not exceeding 20% of its total issued share capital as at the date of passing the relevant resolution(s) at the SGM.

(2) Reasons for the Refreshment of General Mandate

As referred to in the Board Letter, in line with the business plans of the Group (reference is made to the management discussion and analysis as set out in the Interim Report), the Group will continue to identify, explore and evaluate new businesses and investment opportunities and consider investing in projects which may be of good profit potential and/or bring long-term benefits to the Group and the Shareholders. To facilitate the Group’s acquisition of suitable investments and to further enhance the Group’s

– 12 –

LETTER FROM GUANGDONG SECURITIES

working capital, if and when considered necessary, the Group will consider raising additional funds through various means, which shall include the issue of new Shares and/or debt financing. With the New General Mandate, the Company will have more flexibility in raising additional funds for the use of the Group as and when it is considered necessary.

In view of the above, we are of the opinion that the grant of the New General Mandate would provide the Company with the necessary flexibility to fulfil any possible funding needs for future business development and/or investment decisions. Accordingly, we are of the view that the grant of the New General Mandate is in the interests of the Company and the Shareholders as a whole.

(3) Capital fund raising activities in the past twelve months

As confirmed by the Directors, the Company had not conducted any capital fund raising activities in the past twelve months immediately prior to the Latest Practicable Date.

(4) Flexibility in financing

As advised by the Directors, the Group does not obviate the possibilities of further issuing capital if there is investor indicating interest in the business of the Group. In this relation, the Directors believe that the grant of the New General Mandate will provide the Group with flexibility for possible future fund raising. The Directors are therefore of the view that the grant of the New General Mandate is in the interests of the Company and the Shareholders as a whole.

As discussed in the foregoing, we consider that the grant of the New General Mandate would provide the Company with the necessary flexibility to fulfil any possible funding needs for future business development and/or investment decisions. The granting of the New General Mandate would provide the Company with the flexibility as allowed under the Listing Rules to issue and allot new Shares for equity fund raising activities, such as placing of new Shares, or as consideration for potential investments in the future as and when such opportunities arise. Furthermore, the additional amount of equity which may be raised after the grant of the New General Mandate would provide the Group with more financing options when assessing and negotiating potential investments in a timely manner. Given the financial flexibility available to the Company as discussed above, we are of the opinion that the grant of the New General Mandate is in the interests of the Company and the Shareholders as a whole.

(5) Other financing alternatives

We have enquired into the Directors and the Directors confirmed that apart from equity financing, the Group will also consider debt financing, such as bank borrowings and issue of bonds, to be other possible fund raising alternatives available to the Group.

– 13 –

LETTER FROM GUANGDONG SECURITIES

Nevertheless, the Directors are of the view that the ability of the Group to obtain bank borrowings usually depends on the Group’s profitability, financial position and the then prevailing market condition. Furthermore, such alternative may be subject to lengthy due diligence and negotiations with the banks. In light of also that debt financing will usually incur interest burden on the Group, the Directors consider debt financing to be relatively uncertain and time-consuming as compared to equity financing, such as placing of new Shares, for the Group to obtain additional funding.

The Directors further confirmed that they would exercise due and careful consideration when choosing the best financing method available to the Group. With this being the case, along with the fact that the grant of the New General Mandate will provide the Company with an additional alternative and it is reasonable for the Company to have the flexibility in deciding the financing methods for its future business development, we are of the view that the grant of the New General Mandate is in the interests of the Company and the Shareholders as a whole.

(6) Potential dilution to shareholding of the public Shareholders

The table below sets out the shareholding structure of the Company (i) as at the Latest Practicable Date; and (ii) upon full utilisation of the New General Mandate (assuming no other Shares are issued or repurchased by the Company):

						Shareholding in the
						Company upon full
						utilisation of the New
						General Mandate
		Shareholding in the				(assuming no other Shares
		**Company as at **	the Latest			are issued or repurchased
		Practicable Date				by the Company)
		Number of				Number of
		Shares		%		Shares %
Oriental Day International
Limited (Note)		820,757,600		59.21		820,757,600 49.34
Public Shareholders		565,471,000		40.79		565,471,000 33.99
Shares to be issued under
the New General Mandate		–		–		277,245,720 16.67
Total		1,386,228,600		100		1,663,474,320 100

Note: Oriental Day International Limited is 100% beneficially owned by Mr. Lai Leong, the chairman of the Company.

– 14 –

LETTER FROM GUANGDONG SECURITIES

The table above illustrates that the shareholdings of the public Shareholders would decrease from approximately 40.79% as at the Latest Practicable Date to approximately 33.99% upon full utilisation of the New General Mandate (assuming no other Shares are issued or repurchased by the Company). Such potential dilution to the shareholdings of the public Shareholders represents a dilution of approximately 6.80 percent point.

Taking into account that the New General Mandate (i) would provide an alternative to increase the amount of capital which may be raised under the New General Mandate; (ii) would provide more options of financing to the Group for further development of its business and in other potential future investment as and when such opportunities arise; and (iii) the shareholding interests of all the Shareholders in the Company will be diluted in proportion to their respective shareholdings upon any utilisation of the New General Mandate, we are of the opinion that the potential dilution to the shareholdings of the public Shareholders as just mentioned is acceptable.

RECOMMENDATION

Having taken into consideration the factors and reasons as stated above, we are of the opinion that the grant of the New General Mandate is fair and reasonable so far as the Independent Shareholders are concerned and is in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Board Committee to advise the Independent Shareholders to vote in favour of the ordinary resolution(s) to be proposed at the SGM to approve the grant of the New General Mandate and we recommend the Independent Shareholders to vote in favour of the ordinary resolution(s) in this regard.

Yours faithfully, For and on behalf of Guangdong Securities Limited Graham Lam

Managing Director

– 15 –

NOTICE OF SGM

RISING DEVELOPMENT HOLDINGS LIMITED ( )[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1004)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the special general meeting of Rising Development Holdings Limited (the “ Company ”) will be held at Rooms 2004-5, 20th Floor, World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong on Monday, 1 March 2010 at 3:00 p.m. for the purpose of considering and, if thought fit, passing the following resolution as an ordinary resolution of the Company:

ORDINARY RESOLUTION

“THAT:

• (a) the general mandate granted to the directors of the Company (the “Directors”) to exercise the powers of the Company to allot, issue and deal with shares of the Company as approved by the shareholders of the Company (the “Shareholder(s)”) at the annual general meeting of the Company held on 13 August 2009 be and is hereby revoked (without prejudice to any valid exercise of such general mandate prior to the passing of this Resolution);

• (b) subject to paragraph (d) below, and pursuant to the Rules Governing the Listing of Securities on the Stock Exchange, the exercise by the Directors during the Relevant Period (as hereinafter defined in this Resolution) of all the powers of the Company to allot, issue and deal with unissued shares in the share capital of the Company and to make or grant offers, agreements and options (including but not limited to warrants, bonds and debentures convertible into shares of the Company) which would or might require the exercise of such powers be and is hereby generally and unconditionally approved;

* For identification purpose only

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• (c) the approval in paragraph (b) above shall authorise the Directors during the Relevant Period (as hereinafter defined in this Resolution) to make or grant offers, agreements and options (including warrants, bonds and debentures convertible into shares of the Company) which would or might require the exercise of such powers after the end of the Relevant Period (as hereinafter defined in this Resolution);

• (d) the aggregate nominal amount of the share capital of the Company allotted or agreed conditionally or unconditionally to be allotted or issued (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (b) above, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); or (ii) an issue of shares upon the exercise of the subscription rights attaching to any warrants which may be issued by the Company from time to time; or (iii) an issue of shares of the Company upon the exercise of options which may be granted under the share option scheme or similar arrangement for the time being adopted for the grant or issue to eligible persons of shares of the Company or rights to acquire shares of the Company; or (iv) any scrip dividend scheme or similar arrangement providing for the allotment and issue of shares of the Company in lieu of the whole or part of a dividend on shares of the Company in accordance with the bye-laws of the Company, shall not exceed 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing of this Resolution, and the said approval shall be limited accordingly; and

• (e) for the purpose of this Resolution:

“Relevant Period” means the period from the passing of this Resolution until whichever is the earliest of:

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or any applicable laws of Bermuda to be held; and

• (iii) the passing of an ordinary resolution by Shareholders in general meeting revoking, varying or renewing the authority given to the Directors by this Resolution.

“Rights Issue” means an offer of shares of the Company or issue of options, warrants or other securities giving the right to subscribe for shares of the Company, open for a period fixed by the Directors to holders of shares whose names appear on the register of members of the Company (and, where appropriate, to holders of other securities of the Company entitled to the offer) on a fixed record date in proportion to their then holdings of such shares of the Company (or, where appropriate, such other securities), (subject in all cases to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or

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having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any territory applicable to the Company).”

By order of the Board Rising Development Holdings Limited Lai Leong Chairman

Hong Kong, 10 February 2010

Notes:

1. A form of proxy for use at the meeting is enclosed herewith.

2. The instrument appointing a proxy shall be in writing under the hand of the appointer or his/her attorney duly authorised in writing or, if the appointer is a corporation, either under its seal or under the hand of any officer, attorney or other person authorised to sign the same.

3. Any shareholder entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a shareholder of the Company.

4. In order to be valid, a form of proxy in the prescribed form together with the power of attorney or other authority (if any) under which it is signed must be deposited at the Company’s branch registrar in Hong Kong, Tricor Tengis Limited at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time fixed for holding the meeting.

5. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or at any adjourned meeting thereof (as the case may be) should you so wish, and in such an event, the form of proxy shall be deemed to be revoked.

6. Where there are joint registered holders of any share, any one of such joint holders may vote, either in person or by proxy, in respect of such shares as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the meeting, whether in person or by proxy, the joint registered holder present whose name stands first on the register of members in respect of the shares shall be accepted to the exclusion of the votes of the other registered holders.

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