Persistence Gold Group Ltd — Share Issue/Capital Change 2006

Dec 11, 2006

SHANGHAI MERCHANTS HOLDINGS LIMITED

*

(Incorporated in Bermuda with limited liability)

(Stock code: 1104)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that a special general meeting (the “Meeting”) of Shanghai Merchants Holdings Limited (the “Company”) will be held on 20th Floor, Central Tower, 28 Queen’s Road, Central, Hong Kong on Thursday, 4 January 2007 at 10:00 a.m. for the purpose of considering and if thought fit, passing with or without amendments, the following resolutions numbered 2, 3, 6 to 8 as ordinary resolutions of the Company to be taken by way of poll and the controlling shareholder (i.e. Profit Harbour Investments Limited) and its associates shall abstain from voting, the following ordinary resolutions numbered 1, 4 and 5 as ordinary resolutions of the Company and the following special resolution numbered 9 as special resolution of the Company:

ORDINARY RESOLUTIONS

1. “ THAT the authorised share capital of the Company be and is hereby increased from HK$200,000,000 divided into 2,000,000,000 shares of HK$0.10 each (the “Shares”) to HK$800,000,000 divided into 8,000,000,000 shares of HK$0.10 each by the creation of an additional 6,000,000,000 Shares ranking pari passu in all respects with the existing issued and unissued Shares of the Company.”

2. “ THAT subject to approval of the resolutions numbered 1 above and 3 below, conditional upon the completion of the Rights Issue (as hereinafter defined in resolution numbered 3), the conditional sale and purchase agreement dated 27 October 2006 (the “Acquisition Agreement”) entered into between (i) Fortune Desire Investments Limited (“Fortune Desire”), a direct wholly-owned subsidiary of the Company, as the purchaser; and (ii) Honest Opportunity Limited and New Fortress Investments Limited as the vendors in relation to the sale and purchase of 48,373,197 ordinary shares of Mount Gibson Iron Limited (“Mount Gibson”), representing approximately 8.79% of interest in Mount Gibson as at 7 November 2006 (Australian time) (subject to dilution effect, if any, from time to time contemplated by Mount Gibson issuing shares as a result of the unconditional takeover offer in respect of Aztec Resources Limited) at a consideration of HK$244,474,752, 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 Acquisition Agreement be and are hereby approved, confirmed and ratified, and THAT the directors of the Company (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 Acquisition Agreement.”

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1. “ THAT subject to approval of the resolution numbered 1 above, conditional upon (i) the Listing Committee of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) granting or agreeing to grant (subject to allotment and despatch of certificates in respect of Rights Shares (as hereinafter defined), as appropriate, the posting of the prospectus to be issued by the Company dated 4 January 2007, the renounceable provisional allotment letter and the form of application for excess Rights Shares (collectively the “Rights Issue Documents”) to the qualifying shareholders of the Company, and the delivery of the same to the Underwriter (as hereinafter defined) on 4 January 2007, and any other condition which may be agreed in their reasonable opinion by the Company and the Underwriter (as hereinafter defined)) the listing of, and permission to deal in, the Rights Shares (as hereinafter defined) (in both their nil-paid and fully paid forms), the Bonus Warrants (as hereinafter defined) and the Shares which may fall to be issued upon the exercise of the Bonus Warrants on the Stock Exchange on or before 5:00 p.m. on the second business day after the date which is the latest time for acceptance of and payment for Rights Shares (as hereinafter defined); (ii) the filing with and registration of the Rights Issue Documents by the Registrar of Companies in Hong Kong in compliance with the Companies Ordinance and the Registrar of Companies in Bermuda (the “Registrar in Bermuda”) in accordance with the Companies Act 1981 of Bermuda (as amended); and (iii) the obligations of Sun Hung Kai International Limited (the “Underwriter”) under the underwriting agreement dated 8 November 2006 (the “Underwriting Agreement” including, if any, all supplemental agreements relating thereto) made between the Company and the Underwriter becoming unconditional and the Underwriting Agreement not being terminated in accordance with the terms thereof prior to 5:00 p.m. on the third business day after the date which is the latest time for acceptance of and payment for Rights Shares (as hereinafter defined), as set out in the circular dated 12 December 2006 (the “Circular”) despatched by the Company to the Shareholders (a copy of which has been produced to the Meeting marked “B” and signed by the chairman of the Meeting for the purpose of identification):

2. (a) the issue, by way of rights, of 1,259,000,000 new shares of par value of HK$0.10 each (the “Shares”) in the issued share capital of the Company (the “Rights Issue”), such 1,259,000,000 new Shares (the “Rights Shares”) to be issued at a price of HK$0.30 per Rights Share (the “Subscription Price”) to the Shareholders whose names appear on the register of members of the Company on the date by reference to which entitlements under the Rights Issue will be determined (other than those Shareholders (the “Excluded Shareholders”) with registered addresses outside Hong Kong and whom the board of Directors, after making relevant enquiry, considers their exclusion from the Rights Issue to be necessary or expedient on account either of the legal restrictions under the laws of the relevant place or any requirements of the relevant regulatory body or stock exchange in that place) in the proportion of one Rights Share for every one existing Share then held and otherwise pursuant to and in accordance with the terms and conditions set out in the Circular be and is hereby approved;

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• (b) the issue of 251,800,000 bonus warrants (“Bonus Warrants”) which entitle the holder thereto to subscribe for Shares at an initial price of HK$0.30 per Share (subject to adjustment), by way of bonus on the basis of one unit of subscription right for every five Rights Shares taken up (“Bonus Warrants Issue”) be and is hereby approved;

• (c) the issue of 251,800,000 new Shares which fall to be issued upon the exercise of the Bonus Warrants pursuant to the Bonus Warrants Issue be and is hereby approved;

• (d) (i) the Directors be and are hereby authorised to allot and issue the Rights Shares and the Bonus Warrants pursuant to or in connection with the Rights Issue and the Bonus Warrants Issue notwithstanding that the same may be offered, allotted or issued otherwise than pro rata to the existing Shareholders and, in particular, (ii) the Directors be and are hereby authorised to make such exclusions or other arrangements in relation to fractional entitlements or Excluded Shareholders as they may, at their absolute discretion, deem necessary or expedient or appropriate, and the Rights Shares shall not be issued to the Excluded Shareholders but shall be aggregated and issued to a nominee to be named by the Directors and such Rights Shares shall be sold and the net proceeds of such sale, after deduction of expenses shall be distributed to the Excluded Shareholders pro rata to their respective shareholdings unless the amount falling to be distributed to any Excluded Shareholder shall be less than HK$100 in which case such amount shall be retained for the benefit of the Company;

• (e) the Underwriting Agreement, 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 Underwriting Agreement be and are hereby approved, confirmed and ratified, and THAT the Directors be and are hereby authorized 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 Underwriting Agreement; and

• (f) the Directors be and are hereby authorised to do all 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 Rights Issue and the Bonus Warrants Issue.”

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4. “ THAT :

• (a) subject to paragraph (b) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to repurchase Shares be and is hereby generally and unconditionally approved;

• (b) the aggregate nominal amount of the Shares which may be repurchased by the Company pursuant to the approval in paragraph (a) above shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue at the date of the passing of this Resolution;

• (c) the general mandate granted to the Directors to exercise the powers of the Company to purchase the Shares as approved by the Shareholders in the annual general meeting held on 23 May 2006 (“2006 AGM”) be and is hereby revoked (without prejudice to any valid exercise of such general mandate prior to the passing of this Resolution); and

• (d) 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 Bermuda law or the Company’s bye-laws to be held; or

  • (iii) the revocation or variation of the authority given under this Resolution by an ordinary resolution of the Shareholders in general meeting.”

• “ THAT :

• (a) subject to approval of the resolution numbered 3 above, and subject further to paragraph (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional Shares of the Company, and to make or grant offers, agreements and options which would or might require the exercise of such powers, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

• (b) the approval in paragraph (a) above shall be in addition to any other authorizations given to the Directors and shall authorise the Directors during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such powers after the end of the Relevant Period;

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• (c) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (a) above, otherwise than pursuant to:

• (i) a Rights Issue (as hereinafter defined);

• (ii) the exercise of rights of subscription or conversion under terms of any convertible notes issued by the Company or any securities which are convertible into Shares;

• (iii) the exercise of any option under the share option scheme or similar arrangement for the time being adopted for the grant or issue to officers or employees of the Company or any of its subsidiaries of Shares or rights to acquire Shares; and

• (iv) any scrip dividend or similar arrangement providing for the allotment of Shares in lieu of the whole or part of a dividend on the Shares in accordance with the bye-laws of the Company in force from time to time,

shall not exceed 15.16% of the aggregate nominal amount of share capital of the Company in issue at the date of the passing of this Resolution as enlarged (subject to the completion of the Rights Issue) by the allotment and issue of the Rights Shares (such percentage being a refreshment of the unused portion of the general mandate granted by the shareholders of the Company at the 2006 AGM authorising the Directors, amongst other things, to allot, issue and deal in the Shares of the then issued share capital of the Company and to make or grant offers, agreements and options which would or might require the exercise of such powers during or after end of the relevant period which shall not exceed aggregate of 20% of the nominal amount of the share capital of the Company in issue as at the date of the 2006 AGM) and the said approval shall be limited accordingly; and

• (d) 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 Bermuda law or the Company’s bye-laws to be held; or

• (iii) the revocation or variation of the authority given under this Resolution by an ordinary resolution of the Shareholders in general meeting; and

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“ Rights Issue ” means the allotment, issue or grant of Shares pursuant to an offer of Shares open for a period fixed by the Directors to holders of Shares or any class thereof on the register of members on a fixed record date in proportion to their then holdings of such Shares or class thereof (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of, any recognized regulatory body or stock exchange in any territory outside Hong Kong).”

1. “ THAT :

2. (a) subject to approval of the resolution numbered 3 above, and subject further to paragraph (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional Shares of the Company, and to make or grant offers, agreements and options which would or might require the exercise of such powers, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

3. (b) the approval in paragraph (a) above shall be in addition to any other authorizations given to the Directors and shall authorise the Directors during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such powers after the end of the Relevant Period;

4. (c) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (a) above, otherwise than pursuant to:

   • (i) a Rights Issue (as hereinafter defined);

   • (ii) the exercise of rights of subscription or conversion under terms of any convertible notes issued by the Company or any securities which are convertible into Shares;

   • (iii) the exercise of any option under the share option scheme or similar arrangement for the time being adopted for the grant or issue to officers or employees of the Company or any of its subsidiaries of Shares or rights to acquire Shares; and

   • (iv) any scrip dividend or similar arrangement providing for the allotment of Shares in lieu of the whole or part of a dividend on the Shares in accordance with the bye-laws of the Company in force from time to time,

shall not exceed 4.84% of the aggregate nominal amount of share capital of the Company in issue at the date of the passing of this Resolution as enlarged (subject to the completion of the Rights Issue) by the allotment and issue of the Rights Shares (such percentage being the used up portion of the general mandate granted

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by the shareholders of the Company at the 2006 AGM authorising the Directors, amongst other things, to allot, issue and deal in the Shares of the then issued share capital of the Company and to make or grant offers, agreements and options which would or might require the exercise of such powers during or after end of the relevant period which shall not exceed aggregate of 20% of the nominal amount of the share capital of the Company in issue as at the date of the 2006 AGM) and the said approval shall be limited accordingly; and

• (d) 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 Bermuda law or the Company’s bye-laws to be held; or

• (iii) the revocation or variation of the authority given under this Resolution by an ordinary resolution of the Shareholders in general meeting; and

“ Rights Issue ” means the allotment, issue or grant of Shares pursuant to an offer of Shares open for a period fixed by the Directors to holders of Shares or any class thereof on the register of members on a fixed record date in proportion to their then holdings of such Shares or class thereof (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of, any recognized regulatory body or stock exchange in any territory outside Hong Kong).”

1. “ THAT subject to approval of the resolutions numbered 1 above and 8 below, the placing agreement dated 9 November 2006 (the “Placing Agreement”) entered into between (i) Sun Hung Kai Investment Services Limited (the “Placing Agent’) as the placing agent; and (ii) the Company as the vendor in relation to the placing of 800,000,000 Shares (the “Placing Shares”) at a price of HK$0.30 per Share, a copy of which has been produced at the Meeting marked “D” 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 Placing 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 Placing Agreement.”

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1. “ THAT subject to approval of the resolutions numbered 1 and 7 above, conditional upon (i) the Listing Committee of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) granting or agreeing to grant the listing of, and permission to deal in, the Placing Shares on the Stock Exchange; and (ii) the obligations of the Placing Agent under the Placing Agreement (including, if any, all supplemental agreements relating thereto) made between the Company and the Placing Agent becoming unconditional and the Placing Agreement not being terminated in accordance with the terms thereof prior to 12:00 noon on a day which is two (2) months from the date of this Meeting if such day not being a Business Day, the preceding Business Day of such date:

2. (a) the grant of the specific mandate in relation to the issue of 800,000,000 new Shares pursuant to the Placing Agreement be and is hereby approved; and

3. (b) the exercise by the Directors during the Placing Period of all the powers of the Company to allot, issue and deal with the Placing Shares of the Company, and to make or grant offers, agreements and options which would or might require the exercise of such powers, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved,

for the purpose of this resolution:

“Placing Period ” means the period of two (2) months from the date of this Meeting and ending at 5:00 p.m. on the Business Day preceding the Placing Completion Date.

“ Placing Completion Date ” means a day which is two (2) months from the date of this Meeting, if such date not being a Business Day, the preceding Business Day of such day.

“ Business Day” means a day (excluding Saturday, Sunday or any day on which a tropical cyclone warning signal no. 8 or above or a black rainstorm warning signal is hoisted in Hong Kong at any time between 9:00 a.m. and 5:00 p.m.) on which banks are generally open for business in Hong Kong.

SPECIAL RESOLUTION

1. “ THAT subject to and conditional upon the approval of the Registrar in Bermuda, the name of the Company be changed to “APAC Resources Limited” and subject to the new English name of the Company becoming effective, “ ” be adopted as its Chinese name for identification purpose only and the directors of the Company be and are hereby authorized to do all such acts, deeds and things and execute all such documents with or without amendments and affix the common seal of the Company thereto (if required) as they may, in their absolute discretion, deem fit in order to effect such change of name.”

By Order of the Board Shanghai Merchants Holdings Limited Yue Jialin Chairman

Hong Kong, 12 December 2006

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Registered office: Head office and principal Clarendon House place 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:

1. 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.

2. 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, 26/F., 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 of the Company are as follows:

Executive Directors:

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

Independent Non-Executive Directors:

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

Please also refer to the published version of this announcement in The Standard.

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