Shanghai Able Digital Science&Tech Co., Ltd. — Capital/Financing Update 1999

Dec 15, 1999

Listed Company Information

SE ASIA WOOD<1205> - Announcement The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, 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 announcement. SOUTH EAST ASIA WOOD INDUSTRIES HOLDINGS LIMITED (Incorporated in Bermuda with limited liability) ANNOUNCEMENT SUMMARY This announcement is made at the request of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") in connection with the recent fluctuation in the price and increase in the turnover of the shares of the Company. The board of directors (the "Board") of South East Asia Wood Industries Holdings Limited (the "Company", and together with its subsidiaries, the "Group") has noted the recent fluctuation in the price and increase in the turnover of the shares of the Company and wishes to state that it is not aware of any reasons for such increase. As announced by the Company on 17th July 1999, the Company was in active negotiations with its bankers ("Creditor Banks") for rescheduling the repayment terms of the Group's existing overdue loans and to seek their ongoing support. It was also announced that the Board will continue to explore other means to improve the Group's financial position including fund raising by means of (but not limited to) the issue of new shares, debt instruments etc. The Company has not yet decided on the manner of fund raising. The Company has now been informed by an independent strategic investor (which is not connected with the directors, chief executive or substantial shareholders of the Company and its subsidiaries or any of their associates) through its financial adviser that the strategic investor had on 13th December 1999 submitted a preliminary proposal with the Creditor Banks for the injection of new capital by way of subscription of new shares in the Company (the "Proposal"). Since the Proposal is in a preliminary form, neither the number of shares nor the subscription price of the shares has been determined. As at the date hereof, neither the Company nor the strategic investor has been approached by the Creditor Banks regarding the Proposal. In the event that an agreement had been reached with the Creditor Banks and the strategic investor concerning the Proposal, a further announcement containing particulars of such agreement in compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited will be issued by the Company as appropriate. As the Proposal is still in a preliminary form and there has not been any negotiations between the Company, the strategic investor and the Creditor Banks concerning the Proposal, the Proposal may or may not proceed and shareholders of the Company and potential investors are reminded to exercise caution when dealing in the shares of the Company. The Board also wishes to inform shareholders and potential investors that the Company will be issuing its 12 months' interim report on or about 21st December 1999 and the directors of the Company expect that the Group will record a substantial loss for the twelve months ended 30th September 1999, including operating loss, deficit on revaluation of fixed assets amounting to US$22,291,677 (about HK$172,760,497) relating to the Laos operation and exceptional loss arising from assignment of receivables amounting to US$10,874,904 (about HK$84,280,506) in relation to the disposal of the Laos operation. The amount of the deficit and the exceptional loss have already been disclosed in the circular of the Company dated 25th October 1999. The 12 months' interim report will be issued due to the recent change of financial year end of the Company as announced by the Company on 24th September 1999. Save as disclosed herein, the Board confirms that there are no negotiations or agreements relating to intended acquisitions or realisations which are discloseable under paragraph 3 of the Listing Agreement, neither is the Board aware of any matter discloseable under the general obligation imposed by paragraph 2 or the Listing Agreement, which is or may be of a price sensitive nature. The Board also confirms that the directors of the Company have complied with the Model Code for Securities Transactions by Directors of Listed Companies and had not dealt in the shares of the Company for a period of one month prior to the date of this announcement. Made by the order of the Board the directors of which individually and jointly accept responsibility for the accuracy of this announcement. By Order of the Board South East Asia Wood Industries Holdings Limited Wong Chak Ming, William Director Hong Kong, 14th December 1999 Note: In this announcement, United States dollars has been converted into Hong Kong dollars at the rate of US$1=HK$7.75 for reference purpose only.