Persistence Gold Group Ltd - Proxy Solicitation & Information Statement 2007

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your securities in APAC Resources Limited, you should at once hand this circular to the purchaser or transferee, or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

This circular appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the shares of the Company or any other securities.

APAC RESOURCES LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 1104)

DISCLOSEABLE TRANSACTION

(1) CONDITIONAL SALE AND PURCHASE OF AN AGGREGATE OF APPROXIMATELY 12.66 PER CENT. OF THE ISSUED SHARE CAPITAL OF CHINA PRIMARY RESOURCES HOLDINGS LIMITED

AND

(2) PROPOSED GRANT OF SPECIFIC MANDATE TO ISSUE SHARES

A letter from the board of directors of APAC Resources Limited is set out on pages 4 to 23 of this circular.

A notice convening the SGM to be held at 7th Floor, Board Room, The Dynasty Club, South West Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong on Friday, 27th July 2007 at 10:30 a.m. or any adjourned meeting is set out on pages 30 to 32 of this circular. If you are not able to attend the SGM, you are requested to complete the form of proxy in accordance with the instructions printed on it and return it to the Hong Kong Branch Share Registrar of the Company, Secretaries Limited, at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding the SGM or any adjourned meeting. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the SGM or any adjourned meeting should you so desire.

* For identification purpose only

22nd June, 2007

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
The Siberian Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
The Asia Bright Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
The First South Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Effect of the Issue of the Consideration Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Information about Siberian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Information about Asia Bright . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Information about First South . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Information about the Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Information about Super Grand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Information of CPR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Summary of Financial Results of CPR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21
Reasons for and Benefits of Sale and Purchase of the Siberian Sale Shares,
Asia Bright Sale Shares and First South Sale Shares . . . . . . . . . . . . . . . . . . . . . . . . . .	21
Financial Effect of the Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	22
Listing Rules Implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23
Proposed Grant of Specific Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23
Appendix — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	24
Notice of the SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	30

— i —

DEFINITIONS

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

“Agreements”

the Siberian Agreement, the Asia Bright Agreement and the First South Agreement

“Announcement” announcement of the Company dated 31st May, 2007
“Asia Bright”

Asia Bright International Limited, a company incorporated in the B.V.I. with limited liability

“Asia Bright Consideration 95,374,546 new Shares Shares”
“Asia Bright Agreement”

the agreement for sale and purchase dated 29th May, 2007 entered into between Asia Bright, Zhang Yuhong and Super Grand, with respect to the sale and purchase of the Asia Bright Sale Shares (representing 4.20 per cent. of the issued share capital of CPR as at the Latest Practicable Date)

“Asia Bright Sale Shares”	286,123,640 CPR Shares, representing 4.20 per cent. of the
	issued share capital of CPR as at the Latest Practicable Date
“associates”	having the meaning ascribed to it in the Listing Rules
“B.V.I.”	British Virgin Islands
“CPR”	China Primary Resources Holdings Limited, a company
	incorporated in the Cayman Islands with limited liability,
	with its shares listed on the Growth Enterprise Market of the
	Stock Exchange (Stock Code: 8117)
“CPR Shares”	shares of nominal value of HK$0.00125 each in the issued
	share capital of CPR
“Company”	APAC Resources Limited, a company incorporated in
	Bermuda with limited liability, with its securities listed on the
	Stock Exchange
“Consideration Shares”	287,637,505 new Shares, being the aggregate of the Siberian
	Consideration Shares, the Asia Bright Consideration Shares
	and the First South Consideration Shares
“connected persons”	having the meaning ascribed to it in the Listing Rules
“Directors”	the directors of the Company
“First South”	First South International Limited, a company incorporated in
	the B.V.I. with limited liability

— 1 —

DEFINITIONS

“First South Consideration	90,832,893 new Shares
Shares”
“First South Agreement”	the agreement for sale and purchase dated 29th May, 2007
	entered into between First South, Mai Wei Liang and Super
	Grand, with respect to the sale and purchase of the First South
	Sale Shares (representing 4.00 per cent. of the issued share
	capital of CPR as at the Latest Practicable Date)
“First South Sale Shares”	272,498,680 CPR Shares, representing 4.00 per cent. of the
	issued share capital of CPR as at the Latest Practicable Date
“Group”	the Company and its subsidiaries
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	Hong Kong Special Administrative Region of the People’s
	Republic of China
“Latest Practicable Date”	18th June, 2007, being the latest practicable date prior to
	printing of this circular for the purpose of ascertaining certain
	information contained in the circular
“Listing Rules”	Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited
“SFO”	Securities and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong)
“SGM”	the special general meeting of the Shareholders of the
	Company to be convened at 10:30 a.m. on Friday, 27th July
	2007
“Shareholders”	holders of the Shares
“Shares”	ordinary shares of HK$0.10 each in the issued share capital of
	the Company
“Siberian”	Siberian Worldwide Ltd., a company incorporated in the
	B.V.I. with limited liability
“Siberian Consideration Shares”	101,430,066 new Shares
“Siberian Agreement”	the agreement for sale and purchase dated 29th May, 2007
	entered into between Siberian, Charlie Lam Leung Seng and
	Super Grand, with respect to the sale and purchase of the
	Siberian Sale Shares (representing 4.46 per cent. of the issued
	share capital of CPR as at the Latest Practicable Date)

— 2 —

DEFINITIONS

“Siberian Sale Shares”	304,290,200 CPR Shares, representing 4.46 per cent. of the
	issued share capital of CPR as at the Latest Practicable Date
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Super Grand”	Super Grand Investments Limited, a company incorporated in
	the B.V.I. with limited liability, and a direct wholly-owned
	subsidiary of the Company
“US$”	United States dollars, the lawful currency of the United States
	of America
“Warrantholders”	holders of the Warrants
“Warrants”	warrants of the Company entitle the holders thereof to
	subscribe at any time during the period from 5th February,
	2007 to 4th February, 2010 (both days inclusive) for fully
	paid Shares at an initial subscription price of HK$0.30 per
	Share (subject to adjustments)

— 3 —

LETTER FROM THE BOARD

APAC RESOURCES LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 1104)

Executive Directors:

Mr. Cao Zhong (Chairman) Mr. Lau Yau Cheung (Chief Executive Officer) Mr. Yue Jialin

Non-Executive Directors: Mr. Liu Yongshun Mr. Zhou Luyong

Independent Non-Executive Directors:

Mr. Wong Wing Kuen, Albert Mr. Tsui Robert Che Kwong Mr. Yang Weiming

Registered Office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Head office and principal place of business in Hong Kong: Rooms 2808-10 28/F., Wing On House 71 Des Voeux Road Central Hong Kong

22nd June, 2007

To the Shareholders and, for information only, the Warrantholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION

(1) CONDITIONAL SALE AND PURCHASE OF AN AGGREGATE OF APPROXIMATELY 12.66 PER CENT. OF THE ISSUED SHARE CAPITAL OF CHINA PRIMARY RESOURCES HOLDINGS LIMITED

AND

(2) PROPOSED GRANT OF SPECIFIC MANDATE TO ISSUE SHARES

— 4 —

LETTER FROM THE BOARD

INTRODUCTION

Reference is made to the Announcement, in which it has stated that on 29th May, 2007, Super Grand (a direct wholly-owned subsidiary of the Company) entered into:-

(i) the Siberian Agreement with Siberian, pursuant to which Siberian has conditionally agreed to sell and Super Grand has conditionally agreed to purchase the Siberian Sale Shares (being 304,290,200 CPR Shares), representing approximately 4.46 per cent. of the issued share capital of CPR as at the Latest Practicable Date, for a consideration of HK$115,630,275.24;
(ii) the Asia Bright Agreement with Asia Bright, pursuant to which Asia Bright has conditionally agreed to sell and Super Grand has conditionally agreed to purchase the Asia Bright Sale Shares (being 286,123,640 CPR Shares), representing approximately 4.20 per cent. of the issued share capital of CPR as at the Latest Practicable Date, for a consideration of HK$108,726,982.44; and
(iii) the First South Agreement with First South, pursuant to which First South has conditionally agreed to sell and Super Grand has conditionally agreed to purchase the First South Sale Shares (being 272,498,680 CPR Shares), representing approximately 4.00 per cent. of the issued share capital of CPR as at the Latest Practicable Date, for a consideration of HK$103,549,498.00.

Completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares are each conditional upon fulfilment of a number of conditions precedent. There will not be any completion, unless completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares all take place at the same time.

Under Chapter 14 of the Listing Rules, the transactions contemplated in the Agreements together constitute a discloseable transaction for the Company, on the basis that the calculation of the consideration, revenue and equity capital ratios are all within the range of 5 per cent. and 25 per cent.

Under the Siberian Agreement, the Asia Bright Agreement and the First South Agreement, the Company will issue the Siberian Consideration Shares, the Asia Bright Consideration Shares and the First South Consideration Shares to Siberian, Asia Bright and First South, respectively, as settlement for the relevant consideration. The Consideration Shares (being an aggregate of 287,637,505 new Shares) represented approximately 8.59 per cent. of the issued share capital of the Company as at the Latest Practicable Date and approximately 7.91 per cent. of the issued share capital of the Company as enlarged by the issue of the Consideration Shares. The Consideration Shares will rank pari passu with all the then existing issued Shares.

The Company will therefore seek the grant of a specific mandate from the Shareholders at the SGM to allot and issue Shares to satisfy the allotment and issue of the Consideration Shares.

— 5 —

LETTER FROM THE BOARD

The purpose of this circular is to provide the Shareholders with information, among other things, details of the terms of the Siberian Agreement, the Asia Bright Agreement, the First South Agreement and the proposal for the grant of specific mandate and a notice to convene the SGM in accordance with the requirements of the Listing Rules.

THE SIBERIAN AGREEMENT

Date

29th May, 2007

Parties

(1) Siberian as vendor
(2) Charlie Lam Leung Seng as guarantor
(3) Super Grand as purchaser

To the best of the Directors’ knowledge, Siberian and its ultimate owners are independent third parties not connected with the Company, Asia Bright, First South, any of their respective subsidiaries or any of their respective associates, or any of the connected persons of the Company, Asia Bright, First South, any of their respective subsidiaries or any of their respective associates.

The Siberian Sale Shares

The Siberian Sale Shares (being 304,290,200 CPR Shares) represented approximately 4.46 per cent. of the issued share capital of CPR as at the Latest Practicable Date. The Siberian Sale Shares will be acquired free from any encumbrance and together with all rights and benefits attaching or accruing to it on or after the date of the Siberian Agreement.

Siberian has given certain representations and warranties in relation to Siberian Sale Shares and Charlie Lam Leung Seng has agreed unconditionally and irrevocably to guarantee to Super Grand the due and punctual performance of the obligations of Siberian pursuant to the Siberian Agreement.

Consideration

The consideration for the sale and purchase of the Siberian Sale Shares is HK$115,630,275.24. The consideration will be settled by way of the issue by the Company of the Siberian Consideration Shares (being 101,430,066 new Shares) on completion of the sale and purchase of the Siberian Sale Shares (being one new Share for every three Siberian Sale Shares).

The market value of the Siberian Consideration Shares was HK$115,630,275.24 by reference to the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement.

— 6 —

LETTER FROM THE BOARD

The market value per share of the Siberian Consideration Shares to be issued by the Company represents:-

(i) the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement;
(ii) a premium of approximately 7.34 per cent. over the average closing price of HK$1.062 per Share as quoted on the Stock Exchange for the last five trading days of the Shares immediately before the date of the Announcement;
(iii) a premium of approximately 7.75 per cent. over the average closing price of HK$1.058 per Share as quoted on the Stock Exchange for the last ten trading days of the Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,007 per cent. over the net asset value of HK$0.103 per Share as stated in the audited consolidated accounts of the Company for the year ended 31st December, 2006.

As at the Latest Practicable Date, the Siberian Consideration Shares represented approximately 3.03 per cent. of the issued share capital of the Company and approximately 2.79 per cent. of the issued share capital of the Company as enlarged by the issue of the Consideration Shares.

The consideration (effectively HK$0.38 per Siberian Sale Share) was arrived at after arm’s length negotiations between Siberian and Super Grand by reference to historical performance of the prices of the CPR Shares and represents:-

(i) a discount of approximately 18.28 per cent. to the closing price of HK$0.465 per CPR Share as quoted on the Stock Exchange on the last trading day of the CPR Shares immediately before the date of the Announcement;
(ii) a discount of approximately 11.42 per cent. to the average closing price of HK$0.429 per CPR Share as quoted on the Stock Exchange for the last five trading days of the CPR Shares immediately before the date of the Announcement;
(iii) a premium of approximately 1.88 per cent. over the average closing price of HK$0.373 per CPR Share as quoted on the Stock Exchange for the last ten trading days of the CPR Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,420 per cent. over the net asset value of HK$0.025 per CPR Share as stated in the audited consolidated accounts of CPR for the year ended 31st December, 2006.

— 7 —

LETTER FROM THE BOARD

Siberian has undertaken that, at any time within six months from completion of the sale and purchase of the Siberian Sale Shares, it:-

(i) may create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any encumbrance over, only up to 50 per cent. of the Siberian Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them), subject to the written approval of Super Grand; and
(ii) will not create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any encumbrance over, any of the remaining 50 per cent. of the Siberian Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them).

The restrictions mentioned in the above paragraphs will cease to have effect from the day following the expiration of six months from the date of completion of the sale and purchase of the Siberian Sale Shares.

The Company has applied to the Listing Committee of the Stock Exchange for the granting of listing of, and permission to deal in, the Siberian Consideration Shares.

Conditions

Completion of the sale and purchase of the Siberian Sale Shares is conditional upon fulfilment of a number of conditions, in particular:-

(i) the Siberian Sale Shares being free from any encumbrance as of completion of the sale and purchase of the Siberian Sale Shares;
(ii) the representations and warranties under the Siberian Agreement remaining true and accurate and not misleading in any material respect as given as of the date of the Siberian Agreement and as of completion of the sale and purchase of the Siberian Sale Shares, and as if given at all times between the date of the Siberian Agreement and completion of the sale and purchase of the Siberian Sale Shares;
(iii) Siberian having complied in full with the obligations under the Siberian Agreement and otherwise having duly performed and observed all of the obligations, undertakings and covenants required to be performed and observed by it under the Siberian Agreement on or prior to completion of the sale and purchase of the Siberian Sale Shares;
(iv) all approval, authorisation, consent, licence, certificate, permit, concession, agreement or other permission of any kind of, from or by any governmental authority, regulatory body or any other third party necessary or desirable for the consummation of the transactions contemplated in the Siberian Agreement having been obtained by Siberian and CPR and remaining in full force and effect;

— 8 —

LETTER FROM THE BOARD

(v) no matter, event, circumstance or change having occurred which has caused, causes or is likely to cause any material adverse effect on:-
(a) the business, operations, prospects or financial condition, or a material portion of the properties or assets, of CPR or of its subsidiaries; or
(b) the ability of Siberian to perform or observe any of its obligations, undertakings or covenants under the Siberian Agreement;
(vi) there being no applicable law which prohibits, restricts or imposes conditions or limitations on, or is reasonably expected to operate to prohibit, restrict or impose conditions or limitations on, the consummation of any of the transactions contemplated in the Siberian Agreement;
(vii) there being no bona fide proceedings in effect, pending or genuinely threatened as of completion of the sale and purchase of the Siberian Sale Shares before any court, tribunal or arbitrator of a competent jurisdiction or by any governmental authority which seek to prohibit, restrict, impose condition or limitation on or otherwise challenge any of the transactions contemplated in the Siberian Agreement;
(viii)CPR retaining its listed status, with the trading in its shares not having been suspended from listing, other than for suspensions of a routine nature, including (without limitation) any suspension relating to the transactions and matters contemplated referred to in the Siberian Agreement;
(ix) compliance by the Company with all applicable disclosure and shareholders’ approval requirements under the Listing Rules (in particular the shareholders’ approval of the grant of the specific mandate to issue the Consideration Shares);
(x) listing of and permission to deal in the Siberian Consideration Shares having been granted by the Listing Committee of the Stock Exchange (and such listing and permission not subsequently being revoked prior to completion of the sale and purchase of the Siberian Sale Shares); and
(xi) completion, to the satisfaction of Super Grand, of all transactions contemplated in the announcement issued by CPR on 9th January, 2007 (subsequently amended by an announcement issued by CPR on 2nd February, 2007) in relation to an acquisition of 22.28 per cent. interest in a mining company by CPR.

Siberian will use its best endeavours to fulfil, or procure the fulfilment of, conditions (i) to (xi). If any of the conditions (except for conditions (ix) and (x)) is not fulfilled (or waived by Super Grand, except for conditions (viii), (ix) and (x) which cannot be waived) on or before 31st December, 2007 (or such later date as may be agreed by Super Grand and Siberian in writing), no party will be obliged to proceed to completion of the sale and purchase of the Siberian Sale Shares, whereupon the Siberian Agreement will cease to be of any force or effect.

— 9 —

LETTER FROM THE BOARD

The sale and purchase of the Siberian Sale Shares is conditional and may or may not proceed. Accordingly, Shareholders and prospective investors are reminded to exercise extreme caution when trading in the Shares.

THE ASIA BRIGHT AGREEMENT

Date

29th May, 2007

Parties

(1) Asia Bright as vendor
(2) Zhang Yuhong as guarantor
(3) Super Grand as purchaser

To the best of the Directors’ knowledge, Asia Bright and its ultimate owners are independent third parties not connected with the Company, Siberian, First South, any of their respective subsidiaries or any of their respective associates, or any of the connected persons of the Company, Siberian, First South, any of their respective subsidiaries or any of their respective associates.

The Asia Bright Sale Shares

The Asia Bright Sale Shares (being 286,123,640 CPR Shares) represented approximately 4.20 per cent. of the issued share capital of CPR as at the Latest Practicable Date. The Asia Bright Sale Shares will be acquired free from any encumbrance and together with all rights and benefits attaching or accruing to it on or after the date of the Asia Bright Agreement.

Asia Bright has given certain representations and warranties in relation to Asia Bright Sale Shares and Zhang Yuhong has agreed unconditionally and irrevocably to guarantee to Super Grand the due and punctual performance of the obligations of Asia Bright pursuant to the Asia Bright Agreement.

Consideration

The consideration for the sale and purchase of the Asia Bright Sale Shares is HK$108,726,982.44. The consideration will be settled by way of the issue by the Company of the Asia Bright Consideration Shares (being 95,374,546 new Shares) on completion of the sale and purchase of the Asia Bright Sale Shares (being one new Share for every three Asia Bright Sale Shares).

The market value of the Asia Bright Consideration Shares is HK$108,726,982.44 by reference to the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement.

— 10 —

LETTER FROM THE BOARD

The market value per share of the Asia Bright Consideration Shares to be issued by the Company represents:-

(i) the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement;
(ii) a premium of approximately 7.34 per cent. over the average closing price of HK$1.062 per Share as quoted on the Stock Exchange for the last five trading days of the Shares immediately before the date of the Announcement;
(iii) a premium of approximately 7.75 per cent. over the average closing price of HK$1.058 per Share as quoted on the Stock Exchange for the last ten trading days of the Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,007 per cent. over the net asset value of HK$0.103 per Share as stated in the audited consolidated accounts of the Company for the year ended 31st December, 2006.

As at the Latest Practicable Date, the Asia Bright Consideration Shares represented approximately 2.85 per cent. of the issued share capital of the Company and approximately 2.62 per cent. of the issued share capital of the Company as enlarged by the issue of the Consideration Shares.

The consideration (effectively HK$0.38 per Asia Bright Sale Share) was arrived at after arm’s length negotiations between Asia Bright and Super Grand by reference to historical performance of the prices of the CPR Shares and represents:-

(i) a discount of approximately 18.28 per cent. to the closing price of HK$0.465 per CPR Share as quoted on the Stock Exchange on the last trading day of the CPR Shares immediately before the date of the Announcement;
(ii) a discount of approximately 11.42 per cent. to the average closing price of HK$0.429 per CPR Share as quoted on the Stock Exchange for the last five trading days of the CPR Shares immediately before the date of the Announcement;
(iii) a premium of approximately 1.88 per cent. over the average closing price of HK$0.373 per CPR Share as quoted on the Stock Exchange for the last ten trading days of the CPR Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,420 per cent. over the net asset value of HK$0.025 per CPR Share as stated in the audited consolidated accounts of CPR for the year ended 31st December, 2006.

— 11 —

LETTER FROM THE BOARD

Asia Bright has undertaken that, at any time within six months from completion of the sale and purchase of the Asia Bright Sale Shares, it:-

(i) may create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any Encumbrance over, only up to 50 per cent. of the Asia Bright Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them), subject to the written approval of Super Grand; and
(ii) will not create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any encumbrance over, any of the remaining 50 per cent. of the Asia Bright Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them).

The Company has applied to the Listing Committee of the Stock Exchange for the granting of listing of, and permission to deal in, the Asia Bright Consideration Shares.

Conditions

Completion of the sale and purchase of the Asia Bright Sale Shares is conditional upon fulfilment of a number of conditions, in particular:-

(i) the Asia Bright Sale Shares being free from any encumbrance as of completion of the sale and purchase of the Asia Bright Sale Shares;
(ii) the representations and warranties under the Asia Bright Agreement remaining true and accurate and not misleading in any material respect as given as of the date of the Asia Bright Agreement and as of completion of the sale and purchase of the Asia Bright Sale Shares, and as if given at all times between the date of the Asia Bright Agreement and completion of the sale and purchase of the Asia Bright Sale Shares;
(iii) Asia Bright having complied in full with the obligations under the Asia Bright Agreement and otherwise having duly performed and observed all of the obligations, undertakings and covenants required to be performed and observed by it under the Asia Bright Agreement on or prior to completion of the sale and purchase of the Asia Bright Sale Shares;
(iv) all approval, authorisation, consent, licence, certificate, permit, concession, agreement or other permission of any kind of, from or by any governmental authority, regulatory body or any other third party necessary or desirable for the consummation of the transactions contemplated in the Asia Bright Agreement having been obtained by Asia Bright and CPR and remaining in full force and effect;

— 12 —

LETTER FROM THE BOARD

(v) no matter, event, circumstance or change having occurred which has caused, causes or is likely to cause any material adverse effect on:-
(a) the business, operations, prospects or financial condition, or a material portion of the properties or assets, of CPR or of its subsidiaries; or
(b) the ability of Asia Bright to perform or observe any of its obligations, undertakings or covenants under the Asia Bright Agreement;
(vi) there being no applicable law which prohibits, restricts or imposes conditions or limitations on, or is reasonably expected to operate to prohibit, restrict or impose conditions or limitations on, the consummation of any of the transactions contemplated in the Asia Bright Agreement;
(vii) there being no bona fide proceedings in effect, pending or genuinely threatened as of completion of the sale and purchase of the Asia Bright Sale Shares before any court, tribunal or arbitrator of a competent jurisdiction or by any governmental authority which seek to prohibit, restrict, impose condition or limitation on or otherwise challenge any of the transactions contemplated in the Asia Bright Agreement;
(viii)CPR retaining its listed status, with the trading in its shares not having been suspended from listing, other than for suspensions of a routine nature, including (without limitation) any suspension relating to the transactions and matters contemplated referred to in the Asia Bright Agreement;
(ix) compliance by the Company with all applicable disclosure and shareholders’ approval requirements under the Listing Rules (in particular the shareholders’ approval of the grant of the specific mandate to issue the Consideration Shares);
(x) listing of and permission to deal in the Asia Bright Consideration Shares having been granted by the Listing Committee of the Stock Exchange (and such listing and permission not subsequently being revoked prior to completion of the sale and purchase of the Asia Bright Sale Shares); and
(xi) completion, to the satisfaction of Super Grand, of all transactions contemplated in the announcement issued by CPR on 9th January, 2007 (subsequently amended by an announcement issued by CPR on 2nd February, 2007) in relation to an acquisition of 22.28 per cent. interest in a mining company by CPR.

Asia Bright will use its best endeavours to fulfil, or procure the fulfilment of, conditions (i) to (xi). If any of the conditions (except for conditions (ix) and (x)) is not fulfilled (or waived by Super Grand, except for conditions (viii), (ix) and (x) which cannot be waived) on or before 31st December, 2007 (or such later date as may be agreed by Super Grand and Asia Bright in writing), no party will be obliged to proceed to completion of the sale and purchase of the Asia Bright Sale Shares, whereupon the Asia Bright Agreement will cease to be of any force or effect.

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LETTER FROM THE BOARD

The sale and purchase of the Asia Bright Sale Shares is conditional and may or may not proceed. Accordingly, Shareholders and prospective investors are reminded to exercise extreme caution when trading in the Shares.

Completion

Subject to fulfilment of the conditions set out in the Asia Bright Agreement, completion of the sale and purchase of the Asia Bright Sale Shares will take place on or before 31st December, 2007 (or such other date as may be agreed by Super Grand and Asia Bright in writing).

There will not be any completion, unless completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares take place at the same time.

THE FIRST SOUTH AGREEMENT

Date

29th May, 2007

Parties

(1) First South as vendor
(2) Mai Wei Liang as guarantor
(3) Super Grand as purchaser

To the best of the Directors’ knowledge, First South and its ultimate owners are independent third parties not connected with the Company, Siberian, Asia Bright, any of their respective subsidiaries or any of their respective associates, or any of the connected persons of the Company, Siberian, Asia Bright, any of their respective subsidiaries or any of their respective associates.

The First South Sale Shares

The First South Sale Shares (being 272,498,680 CPR Shares) represented approximately 4.00 per cent. of the issued share capital of CPR as at the Latest Practicable Date. The First South Sale Shares will be acquired free from any encumbrance and together with all rights and benefits attaching or accruing to it on or after the date of the First South Agreement.

First South has given certain representations and warranties in relation to First South Sale Shares and Mai Wei Liang has agreed unconditionally and irrevocably to guarantee to Super Grand the due and punctual performance of the obligations of First South pursuant to the First South Agreement.

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LETTER FROM THE BOARD

Consideration

The consideration for the sale and purchase of the First South Sale Shares is HK$103,549,498.00. The consideration will be settled by way of the issue by the Company of the First South Consideration Shares (being 90,832,893 new Shares) on completion of the sale and purchase of the First South Sale Shares (being one new Share for every three First South Sale Shares).

The market value of the First South Consideration Shares was HK$103,549,498.00 by reference to the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement.

The market value per share of the First South Consideration Shares to be issued by the Company represents:-

(i) the closing price of HK$1.14 per Share as quoted on the Stock Exchange on the last trading day of the Shares immediately before the date of the Announcement;
(ii) a premium of approximately 7.34 per cent. over the average closing price of HK$1.062 per Share as quoted on the Stock Exchange for the last five trading days of the Shares immediately before the date of the Announcement;
(iii) a premium of approximately 7.75 per cent. over the average closing price of HK$1.058 per Share as quoted on the Stock Exchange for the last ten trading days of the Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,007 per cent. over the net asset value of HK$0.103 per Share as stated in the audited consolidated accounts of the Company for the year ended 31st December, 2006.

As at the Latest Practicable Date, the First South Consideration Shares represented approximately 2.71 per cent. of the issued share capital of the Company and approximately 2.50 per cent. of the issued share capital of the Company as enlarged by the issue of the Consideration Shares.

The consideration (effectively HK$0.38 per First South Sale Share) was arrived at after arm’s length negotiations between First South and Super Grand by reference to historical performance of the prices of the CPR Shares and represents:-

(i) a discount of approximately 18.28 per cent. to the closing price of HK$0.465 per CPR Share as quoted on the Stock Exchange on the last trading day of the CPR Shares immediately before the date of the Announcement;
(ii) a discount of approximately 11.42 per cent. to the average closing price of HK$0.429 per CPR Share as quoted on the Stock Exchange for the last five trading days of the CPR Shares immediately before the date of the Announcement;

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LETTER FROM THE BOARD

(iii) a premium of approximately 1.88 per cent. over the average closing price of HK$0.373 per CPR Share as quoted on the Stock Exchange for the last ten trading days of the CPR Shares immediately before the date of the Announcement; and
(iv) a premium of approximately 1,420 per cent. over the net asset value of HK$0.025 per CPR Share as stated in the audited consolidated accounts of CPR for the year ended 31st December, 2006.

First South has undertaken that, at any time within six months from completion of the sale and purchase of the First South Sale Shares, it:-

(i) may create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any Encumbrance over, only up to 50 per cent. of the First South Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them), subject to the written approval of Super Grand; and
(ii) will not create, effect or suffer any disposal of or any encumbrance over, or (where applicable) permit the registered holder to create, effect or suffer any disposal of or any encumbrance over, any of the remaining 50 per cent. of the First South Consideration Shares (or any direct or indirect interest in them or any of the rights or economic benefits attaching to them).

The Company has applied to the Listing Committee of the Stock Exchange for the granting of listing of, and permission to deal in, the First South Consideration Shares.

Conditions

Completion of the sale and purchase of the First South Sale Shares is conditional upon fulfilment of a number of conditions, in particular:-

(i) the First South Sale Shares being free from any encumbrance as of completion of the sale and purchase of the First South Sale Shares;
(ii) the representations and warranties under the First South Agreement remaining true and accurate and not misleading in any material respect as given as of the date of the First South Agreement and as of completion of the sale and purchase of the First South Sale Shares, and as if given at all times between the date of the First South Agreement and completion of the sale and purchase of the First South Sale Shares;
(iii) First South having complied in full with the obligations under the First South Agreement and otherwise having duly performed and observed all of the obligations, undertakings and covenants required to be performed and observed by it under the First South Agreement on or prior to completion of the sale and purchase of the First South Sale Shares;

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LETTER FROM THE BOARD

(iv) all approval, authorisation, consent, licence, certificate, permit, concession, agreement or other permission of any kind of, from or by any governmental authority, regulatory body or any other third party necessary or desirable for the consummation of the transactions contemplated in the First South Agreement having been obtained by First South and CPR and remaining in full force and effect;
(v) no matter, event, circumstance or change having occurred which has caused, causes or is likely to cause any material adverse effect on:-
(a) the business, operations, prospects or financial condition, or a material portion of the properties or assets, of CPR or of its subsidiaries; or
(b) the ability of First South to perform or observe any of its obligations, undertakings or covenants under the First South Agreement;
(vi) there being no applicable law which prohibits, restricts or imposes conditions or limitations on, or is reasonably expected to operate to prohibit, restrict or impose conditions or limitations on, the consummation of any of the transactions contemplated in the First South Agreement;
(vii) there being no bona fide proceedings in effect, pending or genuinely threatened as of completion of the sale and purchase of the First South Sale Shares before any court, tribunal or arbitrator of a competent jurisdiction or by any governmental authority which seek to prohibit, restrict, impose condition or limitation on or otherwise challenge any of the transactions contemplated in the First South Agreement;
(viii)CPR retaining its listed status, with the trading in its shares not having been suspended from listing, other than for suspensions of a routine nature, including (without limitation) any suspension relating to the transactions and matters contemplated referred to in the First South Agreement;
(ix) compliance by the Company with all applicable disclosure and shareholders’ approval requirements under the Listing Rules (in particular the shareholders’ approval of the grant of the specific mandate to issue the Consideration Shares);
(x) listing of and permission to deal in the First South Consideration Shares having been granted by the Listing Committee of the Stock Exchange (and such listing and permission not subsequently being revoked prior to completion of the sale and purchase of the First South Sale Shares); and
(xi) completion, to the satisfaction of Super Grand, of all transactions contemplated in the announcement issued by CPR on 9th January, 2007 (subsequently amended by an announcement issued by CPR on 2nd February, 2007) in relation to an acquisition of 22.28 per cent. interest in a mining company by CPR.

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LETTER FROM THE BOARD

First South will use its best endeavours to fulfil, or procure the fulfilment of, conditions (i) to (xi). If any of the conditions (except for conditions (ix) and (x)) is not fulfilled (or waived by Super Grand, except for conditions (viii), (ix) and (x) which cannot be waived) on or before 31st December, 2007 (or such later date as may be agreed by Super Grand and First South in writing), no party will be obliged to proceed to completion of the sale and purchase of the First South Sale Shares, whereupon the First South Agreement will cease to be of any force or effect.

The sale and purchase of the First South Sale Shares is conditional and may or may not proceed. Accordingly, Shareholders and prospective investors are reminded to exercise extreme caution when trading in the Shares.

Completion

Subject to fulfilment of the conditions set out in the First South Agreement, completion of the sale and purchase of the First South Sale Shares will take place on or before 31st December, 2007 (or such other date as may be agreed by Super Grand and First South in writing).

There will not be any completion, unless completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares take place at the same time.

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LETTER FROM THE BOARD

EFFECT OF THE ISSUE OF THE CONSIDERATION SHARES

The shareholding structure of the Company immediately before the issue of the Consideration Shares and immediately after completion of the issue of the Consideration Shares are and will be as follows:-

		Approximate	shareholding in the Company	shareholding in the Company
	Immediately before the issue		Immediately after the issue
Name	of the Consideration Shares		of the Consideration Shares
	Number		Number
	of Shares	Percentage	of Shares	Percentage
Profit Harbour Investments Limited
(“Profit Harbour”) (Note 1)	493,399,602	14.73	493,399,602	13.57
Shougang Holding (Hong Kong)
Limited
(“Shougang”) (Note 2)	800,000,000	23.89	800,000,000	22.00
Ms. Chong Sok Un (Notes 3)	601,360,000	17.96	601,360,000	16.53
Siberian	—	—	101,430,066	2.79
Asia Bright	—	—	95,374,546	2.62
First South	—	—	90,832,893	2.50
Public	1,454,341,561	43.42	1,454,341,561	39.99
Total	3,349,101,163	100.00	3,636,738,668	100.00

Notes:

The entire issued share capital of Profit Harbour is owned by Mr. Yue Jialin (“Mr. Yue”) as at the Latest Practicable Date.
This represented an interest in 600,000,000 Shares held by Benefit Rich Limited, 200,000,000 shares held by Easymade Investments Limited, both are wholly-owned subsidiaries of Shougang as at the Latest Practicable Date.
This represented an interest in Shares held by various holding companies, directly or indirectly owned by Ms. Chong Sok Un and her associates as at the Latest Practicable Date.

INFORMATION ABOUT SIBERIAN

The Directors are advised that Siberian is a company incorporated in the B.V.I. with limited liability. It is engaged principally in investment holding.

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LETTER FROM THE BOARD

INFORMATION ABOUT ASIA BRIGHT

The Directors are advised that Asia Bright is a company incorporated in the B.V.I. with limited liability. It is engaged principally in investment holding.

INFORMATION ABOUT FIRST SOUTH

The Directors are advised that First South is a company incorporated in the B.V.I. with limited liability. It is engaged principally in investment holding.

INFORMATION ABOUT THE GROUP

The Company is a company incorporated in Bermuda with limited liability. Its securities are listed on the Main Board of the Stock Exchange.

The Group is principally engaged in (i) trading in base metals and commodities trading portfolio primarily focused on natural resources and related sectors; and (ii) trading in fabric products and other merchandises with investment in the resources and related industries and listed securities as trading portfolio.

INFORMATION ABOUT SUPER GRAND

Super Grand is a company incorporated in the B.V.I. with limited liability. The principal business activity of Super Grand is investment holding.

Super Grand is a direct wholly-owned subsidiary of the Company.

INFORMATION OF CPR

CPR is a company incorporated in the Cayman Islands with limited liability. Its securities are listed on the Growth Enterprise Market of the Stock Exchange.

CPR is principally engaged in the business of general trading and production of fibre glass reinforced plastic pipes in the People’s Republic of China and provision of internet game services in Hong Kong.

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LETTER FROM THE BOARD

SUMMARY OF FINANCIAL RESULTS OF CPR

A summary of the audited results of CPR for the two years ended 31st December, 2005 and 31st December, 2006 are as follows:-

		Year ended 31st December	Year ended 31st December
		2006	2005
		HK$’000	HK$’000
Turnover		34,731	24,389
Profit/(loss)	before tax	(5,876)	23,401
Profit/(loss)	for the year	(5,993)	23,382
Profit/(loss)	attributable to the equity holders of CPR	(5,938)	23,382

The audited net asset value of CPR as at 31st December, 2006 was approximately HK$167,612,000.

No dividends had been declared by CPR in the past three years.

REASONS FOR AND BENEFITS OF SALE AND PURCHASE OF THE SIBERIAN SALE SHARES, ASIA BRIGHT SALE SHARES AND FIRST SOUTH SALE SHARES

The Company has sought and will continue to seek to become a significant natural resources trading and investment company through the identification, evaluation and acquisition of strategic interests in quality natural resources assets (either indirectly through investment in, and support of, resource corporations or by direct investment in mineral projects) as a means to build an extensive portfolio of long term cash generating investments. This is to enhance the Company’s value in the context of natural resources industry consolidation and rationalisation where the Directors believe value can be maximised for all concerned stakeholders. The Company is still on the lookout for good investment opportunities to maximise return for the Shareholders.

Following completion of all the transactions contemplated in the announcement issued by CPR on 9th January, 2007 (subsequently amended by an announcement issued by CPR on 2nd February, 2007), CPR will have a 22.28 per cent. interest in a mining company. The sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares are thus consistent with the strategy of the Company of exploring geographic regions and commodity markets which it believes present attractive opportunities and where rationalisation and consolidation is likely to occur. As a result of CPR becoming interested in 22.28 per cent. of a mining company, the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares are anticipated

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LETTER FROM THE BOARD

to produce a higher return on assets with increase in profit and value of the Company to the benefit of the Shareholders as a whole. Upon completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares, each of Siberian, Asia Bright and First South will procure a member of the Company to sit on the board of directors of CPR.

Following completion of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares, the Group will hold the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares as strategic investments, which will be classified in the accounts as “Available for Sale Financial Assets” as defined under the Hong Kong Accounting Standards HKAS39 issued by Hong Kong Institute of Certified Public Accountants.

Having regard to the nature of and the benefits resulting from the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares and in view of the current market conditions, the Directors believe that the terms of the sale and purchase of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares are fair and reasonable and in the interests of the Shareholders taken as a whole. It represents a good opportunity for the Company to increase its investment further in the natural resources industry upon which to build a significant investment and commodities trading company primarily focused on the natural resources and related sectors.

Net consolidated profits/(losses) attributable to the aggregate of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares for the two financial years ended 31st December, 2006 were:-

(i) approximately HK$2,963,000 (before taxation and extraordinary items) or approximately HK$2,960,000 (after taxation and extraordinary items) for the financial year ended 31st December, 2005; and
(ii) approximately HK$(744,000) (before taxation and extraordinary items) or approximately HK$(759,000) (after taxation and extraordinary items) for the financial year ended 31st December, 2006.

As at 31st December, 2006, the consolidated net book value attributable to the aggregate of the Siberian Sale Shares, the Asia Bright Sale Shares and the First South Sale Shares was HK$21,220,000.

FINANCIAL EFFECT OF THE TRANSACTION

Following completion of the sale and purchase of the Asia Bright Sale Shares, First South Sale Shares and Siberian Sale Shares, the non-current asset of the Group is expected to increase with a corresponding increase in the equity capital of the Group and there will be an overall increase in the net asset value. It is not expected to have any immediate material effect on the Group’s earnings until there is receipt of further dividends or distributions from CPR in respect of the Company’s investment.

LISTING RULES IMPLICATIONS

The transactions contemplated in the Agreements together constitute a discloseable transaction for the Company, on the basis that the calculation of the consideration, revenue and equity capital ratios are all within the range of 5 per cent. and 25 per cent.

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LETTER FROM THE BOARD

PROPOSED GRANT OF SPECIFIC MANDATE TO ISSUE SHARES

Under the Siberian Agreement, the Asia Bright Agreement, and the First South Agreement, the Company will issue the Siberian Consideration Shares, Asia Bright Consideration Shares, and the First South Consideration Shares to Siberian, Asia Bright, and First South, respectively, as settlement for the relevant consideration. The Consideration Shares (being an aggregate of 287,637,505 new Shares) represents approximately 8.59 per cent. of the issued share capital of the Company as at the Latest Practicable Date and approximately 7.91 per cent. of the issued share capital of the Company as enlarged by the issue of the Consideration Shares. The Consideration Shares will rank pari passu with all the then existing issued Shares.

The Company will seek the grant of a specific mandate from the Shareholders at the SGM to allot and issue Shares to satisfy the allotment and issue of the Consideration Shares.

RECOMMENDATION

The Board considers that the transactions contemplated in the Siberian Agreement, the Asia Bright Agreement and the First South Agreement are in the interests of the Company and the Shareholders as a whole, and the terms and transactions contemplated in each of which are fair and reasonable so far as the Shareholders are concerned. Accordingly, the Directors recommend all the Shareholders to vote in favour of all the ordinary resolutions as set out in the notice of the SGM.

ADDITIONAL INFORMATION

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

Yours faithfully, On behalf of the Board APAC RESOURCES LIMITED Cao Zhong

Chairman

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group.

The Directors collectively and individually accept the responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their information, knowledge and belief, there are no other facts not contained in this circular, the omission of which would make any statement herein misleading.

2. DISCLOSURE OF INTERESTS BY DIRECTORS AND CHIEF EXECUTIVES

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executives 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 (i) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interest or short positions which they were taken or deemed to have under such provisions of the SFO); or (ii) were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein; or (iii) were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by the Directors of Listed Issuers contained in the Listing Rules, were as follows:

(a) Long position in Shares

			Approximate
		Number of	per. cent
Name of Director	Capacity and nature	ordinary shares	holding
Mr. Yue	Interest of controlled	612,739,562	18.30%
	corporation (Note 1)	(Note 2)	(Note 3)

Notes:

These Shares are registered/will be registered (as the case may be) in the name of and beneficially owned by Profit Harbour.
This represented an interest in 493,399,602 Shares and an interest in 119,339,960 units of Warrants giving rise to an interest in 119,339,960 underlying Shares. The Warrants entitle the holders to subscribe at any time during the period from 5th February, 2007 to 4th February, 2010 (both days inclusive) for fully paid Shares at an initial subscription price of HK$0.30 per share (subject to adjustments).
The percentage of shareholding was calculated on the basis of the Company’s issued share capital of 3,349,101,163 Shares as at the Latest Practicable Date (before any exercise of the Warrants by the respective holders).

Save as disclosed above, as at the Latest Practicable Date, none of the Directors nor the chief executive of the Company had or was deemed to have any interests or short positions in the Shares, underlying shares or debentures of the Company or any of its associated corporation (within the

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GENERAL INFORMATION

APPENDIX

meaning of Part XV of the SFO) which (i) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they were taken or deemed to have under such provisions of the SFO); or (ii) were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein; or (iii) were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers contained in the Listing Rules.

Save as disclosed above, none of the Directors or proposed directors of the Company (if any) had any interest or short position in Shares or underlying Shares of the Company which would fall to be disclosed pursuant to the provision of Divisions 2 and 3 of Part XV of the SFO.

(b) Interests in competing businesses

As at the Latest Practicable Date, none of the Directors nor their respective associates had any business which competes or is likely to compete, either directly or indirectly, with any businesses of the Group.

(c) Interests in assets

As at the Latest Practicable Date, save for the Deed of Assignment in respect of a debt which Mr. Yue Jialin was indirectly interested in as a result of his shareholding in Profit Harbour, none of the Directors had any direct or indirect interests in any assets which had been acquired or disposed of by, or leased to, or which were proposed to be acquired or disposed of by or leased to any members of the Group since 31st December, 2006, being the date to which the latest published audited consolidated financial statements of the Company were made up.

(d) Interests in contracts

None of the Directors was materially interested in any contracts or arrangements entered into by any members of the Group and subsisting as at the Latest Practicable Date which were significant in relation to the business of the Group.

(e) Remuneration of the Directors

There will be no variation in relation to the remuneration payable to and benefits in kind receivable by the Directors in consequence of the Acquisition and the Conditional Acquisition.

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GENERAL INFORMATION

APPENDIX

3. DISCLOSURE OF INTERESTS BY SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as is known to the Directors and chief executive of the Company, the following persons (not being Directors or chief executives of the Company) had, or were deemed to have, interests or short positions in the Shares and underlying shares of the Company which would fall to be disclosed to the Company or the Stock Exchange under the provisions of Divisions 2 and 3 of part XV of the SFO or who were, directly or indirectly, interested in 10 per cent. or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had an option in respect of such capital:

Long position in Shares and underlying Shares

		Number of
		Shares and	Approximate
		Underlying	per cent.
Name of Shareholders	Capacity and nature	Shares	holding
			(Note 2)	Notes
Profit Harbour	Beneficial owner	612,739,562	18.30%	1,3
Benefit Rich Limited	Corporate Interests (interest
(“Benefit”)	of controlled corporation)	660,000,000	19.71%	4
Easymade Investments	Corporate Interests (interest
Limited (“Easymade”)	of controlled corporation)	200,000,000	5.97%	5
Shougang	Beneficial owner	860,000,000	25.68%	6
Sparkling Summer Limited	Corporate Interests (interest
(“Sparkling Summer”)	of controlled corporation)	606,360,000	18.11%	7
Ms. Chong Sok Un	Beneficial owner	606,360,000	18.11%	8

Notes:

The entire issued share capital of Profit Harbour is owned by Mr. Yue.
The percentage of shareholding was calculated on the basis of the Company’s issued share capital of 3,349,101,163 Shares as at the Latest Practicable Date (before any exercise of the Warrants by the respective holders).
This represented an interest in 493,399,602 Shares and an interest in 119,339,960 units of Warrants giving rise to an interest in 119,339,960 underlying Shares. The Warrants entitle the holders to subscribe at any time during the period from 5th February, 2007 to 4th February, 2010 (both days inclusive) for fully paid Shares at an initial subscription price of HK$0.30 per share (subject to adjustments).
Benefit was interested in 660,000,000 Shares and was a wholly-owned subsidiary of Shougang as at the Latest Practicable Date. This represented an interest in 600,000,000 Shares and an interest in 60,000,000 units of Warrants giving rise to an interest in 60,000,000 underlying Shares. The Warrants entitle the holders to subscribe at any time during the period from 5th February, 2007 to 4th February, 2010 (both days inclusive) for fully paid Shares at an initial subscription price of HK$0.30 per share (subject to adjustments).
Easymade was interested in 200,000,000 Shares and was a wholly-owned subsidiary of Shougang as at the Latest Practicable Date.

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GENERAL INFORMATION

APPENDIX

Benefit and Easymade were both wholly-owned subsidiaries of Shougang as at the Latest Practicable Date. As a result, Shougang is deemed to have the same long position as Benefit and Easymade under the SFO for 660,000,000 and 200,000,000 Shares respectively.
Sparkling Summer was interested in 606,360,000 Shares and was indirectly owned, through various holding companies, by Ms. Chong Sok Un as at the Latest Practicable Date. This represented an interest in 601,360,000 Shares and an interest in 5,000,000 units of Warrants giving rise to an interest in 5,000,000 underlying Shares. The Warrants entitle the holders to subscribe at any time during the period from 5th February, 2007 to 4th February, 2010 (both days inclusive) for fully paid Shares at an initial subscription price of HK$0.30 per share (subject to adjustments).
Sparkling Summer was indirectly owned by Ms. Chong Sok Un as at the Latest Practicable Date. As a result, Ms Chong Sok Un is deemed to have the same long position as Sparking Summer under the SFO for 606,360,000 Shares.

Save as disclosed above, as at the Latest Practicable Date, the Directors and chief executive of the Company were not aware of any other persons (other than Directors or chief executives of the Company) had, or were deemed to have, interests or short positions in the Shares and underlying shares (including any interests in options in respect of such capital), which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, directly or indirectly, interested in 10 per cent. or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had any option in respect of such capital.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any members of the Group excluding contracts expiring or determinable by the employer within one year without payment of compensations other than statutory compensation.

5. MATERIAL LITIGATIONS

As at the Latest Practicable Date, so far as the Directors are aware, the following are the only litigations or claims of material importance which have been pending or threatened against any members of the Group:

Reference is made to the disclosure of litigation and contingent liabilities in the annual report 2006 of the Company.

a. After taking legal advice, the receivers of the Company, Mr. Alan Chung Wah Tang and Ms. Alison Wong Lee Fung Ying, both from Grant Thornton, Certified Public Accountants (the “Receivers”), commenced legal proceedings on 2nd July, 2003 against Great Center Limited (“Great Center”) for the repayment of two sums totaling US$4.5 million (or approximately HK$35.1 million), remitted on or about 21st May, 2003 with no apparent justification, from the bank of Merchants (Hong Kong) Limited, to a bank account maintained in the name of Great Center, and interest thereon, damages and costs of the legal proceedings (the “Great Center Action”).
b. The writ of summons issued on 2nd July, 2003 in relation to the claim against Great Center for the repayment of US$4.5 million was amended on 10th July, 2004 (the “Amended Writ”)

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GENERAL INFORMATION

APPENDIX

to include the claims for (i) the repayment of HK$12.8 million remitted from a bank account of the Company to a bank account in the name of Great Center on or about 17th April, 2003; and (ii) the repayment of HK$22.0 million remitted from a bank account of the Company to a bank account in the name of Modern Shine Enterprises Limited (“Modern Shine”), a company incorporated in the British Virgin Islands, on or about 22nd April, 2003, interest thereon, damages and costs of legal proceedings. The sum of claims under the Amended Writ amounts to approximately HK$69.9 million. At last, the court entered judgment against Modern Shine on 7th November, 2005 for the sum of HK$22,000,000 plus interest and damages for conversion and interest thereon. Regarding the claim against Great Center, the Company has reached an amicable settlement with Great Center’s liquidators. The settlement was approved by the court on 6 November, 2006. The Company received the settlement sum of US$2,637,000 plus interest in the sum of US$114,210.30 from Great Center’s liquidators on 20th November, 2006. The Company has not obtained the judgment sum of HK$22,000,000. Since Modern Shine is a company incorporated in the B.V.I., it makes the enforcement extremely costly. Further, the Company has no information on the financial status and asset position of Modern Shine. As advised by the legal advisers to the Company, the viable course of action includes the petitioning for winding up of Modern Shine, which is also a very costly process.
c. On 23rd August, 2003, the Receivers commenced legal proceedings against Win Victory Holdings Limited (“Win Victory”), a company incorporated in Hong Kong, for the repayment of a sum of HK$37.0 million, together with interest thereon, damages and costs of the legal proceedings. Further, the Receivers, on behalf of the Company, petitioned for the winding-up of Win Victory on the grounds, inter alia, that Win Victory is unable to pay its debts and provisional liquidators were appointed. Due to the lack of funds in Win Victory, the provisional liquidators have not undertaken an extensive investigation and have recently made an application to the court for the discharge of their appointment and their application is fixed to be heard on 20th April, 2006. The continuation of the winding-up petition was to enable a more thorough investigation of the flow of funds in and out of Win Victory. In view of the application by the provisional liquidators, the official receiver made an application to restore the winding-up petition, which has been adjourned to 24th April, 2006 for hearing. The court had on the hearing of 24th April, 2006 ordered that Win Victory be wound-up on the petition of the Company. The Company is making arrangement to prove its debts and to recover its costs of the winding up proceedings in the liquidation of Win Victory.

The Directors are of the opinion that the above litigations or claims would have no material impact on the operations of the Group.

As at the Latest Practicable Date and save for those disclosed above, no member of the Group was engaged in any litigation, arbitration or claim of material importance and no litigation, arbitration or claim of material importance was known to the Directors to be pending or threatened against any members of the Group.

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GENERAL INFORMATION

APPENDIX

6. CORPORATE INFORMATION

Registered office Clarendon House 2 Church Street Hamilton HM11 Bermuda Head office and principal place Rooms 2808-10 of business 28th Floor, Wing On House 71 Des Voeux Road Central Hong Kong Hong Kong branch share Secretaries Limited registrar and transfer office 26th Floor, Tesbury Centre 28 Queen’s Road East Wanchai, Hong Kong

7. GENERAL

(a) The company secretary and the qualified accountant of the Company appointed pursuant to Rule 3.24 of the Listing Rules is Mr. To Yung Kan. Mr. To is a qualified accountant and member of the Hong Kong Institute of Certificate Public Accountants.
(b) The English text of this circular and the accompany form of proxy shall prevail over the Chinese text thereof.

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NOTICE OF THE SGM

APAC RESOURCES LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 1104)

NOTICE IS HEREBY GIVEN that a special general meeting (the “Meeting”) of APAC Resources Limited (the “Company”) will be held on Friday, 27th July 2007 at 10:30 a.m. for the purpose of considering and if thought fit, passing with or without amendments, the following ordinary resolutions of the Company and no shareholder of the Company shall abstain from voting:

ORDINARY RESOLUTIONS

“ THAT the agreement for sale and purchase dated 29th May, 2007 (the “Siberian Agreement”) entered into between (i) Siberian Worldwide Ltd.(“Siberian”), as the vendor; (ii) Charlie Lam Leung Seng as the guarantor; and (iii) Super Grand Investments Limited (“Super Grand”), a direct wholly-owned subsidiary of the Company, as the purchaser in relation to the sale and purchase of 304,290,200 ordinary shares (the “CPR Shares”) in China Primary Resources Holdings Limited (“CPR”), representing approximately 4.46 per cent. interest in the issued share capital of CPR as at 29th May, 2007 at an aggregate consideration of HK$115,630,275.24, a copy of which has been produced at the Meeting marked “A” and signed by the chairman of the Meeting for identification purpose, be and is hereby approved, confirmed and ratified, and THAT all the transactions contemplated under the Siberian Agreement be and are hereby approved, confirmed and ratified, and THAT the directors of the Company (“Directors”) be and are hereby authorised to do such acts and execute such other documents with or without amendments and affix the common seal of the Company thereto (if required) as they may consider necessary, desirable or expedient to carry out or give effect to or otherwise in connection with or in relation to the Siberian Agreement.”
“ THAT the agreement for sale and purchase dated 29th May, 2007 (the “Asia Bright Agreement”) entered into between (i) Asia Bright International Limited (“Asia Bright”), as the vendor; (ii) Zhang Yuhong as the guarantor; and (iii) Super Grand, as the purchaser in relation to the sale and purchase of 286,123,640 CPR Shares in CPR, representing approximately 4.20 per cent. interest in the issued share capital of CPR as at 29th May, 2007 at an aggregate consideration of HK$108,726,982.44, a copy of which has been produced at the Meeting marked “B” and signed by the chairman of the Meeting for identification purpose, be and is hereby approved, confirmed and ratified, and THAT all the transactions contemplated under the Asia Bright Agreement be and are hereby approved, confirmed and ratified, and THAT the Directors be and are hereby authorised to do such acts and execute such other documents with or without amendments and affix the common seal of the Company thereto (if required) as they may consider necessary, desirable or expedient to carry out or give effect to or otherwise in connection with or in relation to the Asia Bright Agreement.”

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NOTICE OF THE SGM

“ THAT the agreement for sale and purchase dated 29th May, 2007 (the “First South Agreement”) entered into between (i) First South International Limited (“First South”), as the vendor; (ii) Mai Wei Liang as the guarantor; and (iii) Super Grand, as the purchaser in relation to the sale and purchase of 272,498,680 CPR Shares in CPR, representing approximately 4.00 per cent. interest in the issued share capital of CPR as at 29th May, 2007 at an aggregate consideration of HK$103,549,498.00, a copy of which has been produced at the Meeting marked “C” and signed by the chairman of the Meeting for identification purpose, be and is hereby approved, confirmed and ratified, and THAT all the transactions contemplated under the First South Agreement be and are hereby approved, confirmed and ratified, and THAT the Directors be and are hereby authorised to do such acts and execute such other documents with or without amendments and affix the common seal of the Company thereto (if required) as they may consider necessary, desirable or expedient to carry out or give effect to or otherwise in connection with or in relation to the First South Agreement.”
“ THAT subject to the Listing Committee of The Stock Exchange of Hong Kong Limited granting the listing of, and permission to deal in, the Consideration Shares (as defined below) either unconditionally or subject to such condition as may be reasonably acceptable to the Company, the Directors be and are hereby authorised to allot and issue 101,430,066, 95,374,546 and 90,832,893 shares (the “Consideration Shares”) of par value of HK$0.10 each in the share capital of the Company respectively to Siberian, Asia Bright and First South in accordance with the terms and conditions of the Siberian Agreement, Asia Bright Agreement and First South Agreement respectively, and THAT the Directors be and are hereby authorised to do all such acts and things, to sign and execute all such further documents and to take such steps as the Directors may in their discretion consider necessary, appropriate, desirable or expedient to give effect to or in connection with the allotment and issue of the Consideration Shares.”

By Order of the Board APAC Resources Limited Cao Zhong Chairman

Hong Kong, 22nd June, 2007

Registered office: Head office and principal place Clarendon House of business in Hong Kong: 2 Church Street Rooms 2808-10, 28/F., Hamilton HM11 Wing On House Bermuda 71 Des Voeux Road Central Hong Kong

For identification purpose only

Notes:

Any member of the Company entitled to attend and vote at the Meeting is entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a member of the Company. A member who is the holder of two or more shares of the Company may appoint more than one proxy to represent him to attend and vote on his behalf.

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NOTICE OF THE SGM

A form of proxy for use in connection with the Meeting is enclosed with this circular. To be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed or a certified copy of that power of attorney or authority must be deposited at the branch share registrar of the Company in Hong Kong, Secretaries Limited, 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the Meeting or any adjournment thereof.

As at the date of this notice, the Directors are as follows:

Executive Directors:

Mr. Cao Zhong ( Chairman )

Mr. Lau Yau Cheung ( Chief Executive Officer )

Mr. Yue Jialin

Non-Executive Directors:

Mr. Liu Yongshun

Mr. Zhou Luyong

Independent Non-Executive Directors:

Mr. Wong Wing Kuen, Albert
Mr. Tsui Robert Che Kwong
Mr. Yang Weiming

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AI assistant

Persistence Gold Group Ltd — Proxy Solicitation & Information Statement 2007

50623_rns_2007-06-22_3346f584-da5e-4b15-831c-acf2db0f2c86.pdf

APAC RESOURCES LIMITED

DISCLOSEABLE TRANSACTION

(1) CONDITIONAL SALE AND PURCHASE OF AN AGGREGATE OF APPROXIMATELY 12.66 PER CENT. OF THE ISSUED SHARE CAPITAL OF CHINA PRIMARY RESOURCES HOLDINGS LIMITED

AND

(2) PROPOSED GRANT OF SPECIFIC MANDATE TO ISSUE SHARES

DEFINITIONS

APAC RESOURCES LIMITED

(Stock code: 1104)

DISCLOSEABLE TRANSACTION

AND

INTRODUCTION

THE SIBERIAN AGREEMENT

Date

Parties

The Siberian Sale Shares

Consideration

Conditions

THE ASIA BRIGHT AGREEMENT

Date

Parties

The Asia Bright Sale Shares

Consideration

Conditions

Completion

THE FIRST SOUTH AGREEMENT

Date

Parties

The First South Sale Shares

Consideration

Conditions

Completion

EFFECT OF THE ISSUE OF THE CONSIDERATION SHARES

INFORMATION ABOUT SIBERIAN

INFORMATION ABOUT ASIA BRIGHT

INFORMATION ABOUT FIRST SOUTH

INFORMATION ABOUT THE GROUP

INFORMATION ABOUT SUPER GRAND

INFORMATION OF CPR

SUMMARY OF FINANCIAL RESULTS OF CPR

REASONS FOR AND BENEFITS OF SALE AND PURCHASE OF THE SIBERIAN SALE SHARES, ASIA BRIGHT SALE SHARES AND FIRST SOUTH SALE SHARES

FINANCIAL EFFECT OF THE TRANSACTION

LISTING RULES IMPLICATIONS

PROPOSED GRANT OF SPECIFIC MANDATE TO ISSUE SHARES

RECOMMENDATION

ADDITIONAL INFORMATION

1. RESPONSIBILITY STATEMENT

2. DISCLOSURE OF INTERESTS BY DIRECTORS AND CHIEF EXECUTIVES

(a) Long position in Shares

(b) Interests in competing businesses

(c) Interests in assets

(d) Interests in contracts

(e) Remuneration of the Directors

3. DISCLOSURE OF INTERESTS BY SUBSTANTIAL SHAREHOLDERS

Long position in Shares and underlying Shares

4. SERVICE CONTRACTS

5. MATERIAL LITIGATIONS

6. CORPORATE INFORMATION

7. GENERAL

APAC RESOURCES LIMITED

ORDINARY RESOLUTIONS

Notes:

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Persistence Gold Group Ltd Proxy Solicitation & Information Statement 2007