Sinopec Engineering Group Co Ltd. — Capital/Financing Update 2003

Jul 29, 2003

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy 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.

寰宇國際控股有限公司 [*] UNIVERSE INTERNATIONAL HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

RIGHTS ISSUE ON THE BASIS OF ONE RIGHTS SHARE FOR EVERY TWO SHARES HELD BY QUALIFYING SHAREHOLDERS AND RESUMPTION OF TRADING

Proposed Rights Issue

• The Company proposes to raise approximately HK$38.3 million, before expenses, by way of a rights issue of 478,201,790 Rights Shares, representing 50.00 per cent. of the existing issued share capital of the Company and approximately 33.33 per cent. of the issued share capital of the Company as enlarged by the Rights Issue, at HK$0.08 per Rights Share. The Company will provisionally allot one Rights Share (in nil-paid form) for every two Shares held by Qualifying Shareholders on the Record Date.

• The Rights Issue is only available to Qualifying Shareholders.

• The Major Shareholder, at the date of this announcement, is interested in 576,754,470 Shares, representing approximately 60.30 per cent. of the existing issued share capital of the Company. The Major Shareholder has irrevocably undertaken to the Company to accept or procure the acceptance of its entitlement of 288,377,235 Rights Shares under the Rights Issue. The balance of the 189,824,555 Rights Shares has been fully underwritten by the Major Shareholder (see “Underwriting Arrangement” below).

• The net proceeds of the Rights Issue, after deduction of expenses, are expected to amount to approximately HK$37.7 million and will be applied as to approximately HK$35.0 million for co-producing films with independent film production companies in the PRC. The remaining balance of the net proceeds will be used for general working capital of the Group.

• The Rights Issue is conditional (see “Conditions of the Rights Issue” below) and subject to the Major Shareholder not terminating the Underwriting Agreement (see “Termination of the Underwriting Agreement” below). Accordingly, the Rights Issue may or may not proceed.

• To qualify for the Rights Issue, any transfer of Shares must be lodged for registration with the Company’s branch share registrar and transfer office in Hong Kong, Abacus Share Registrars Limited at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong, by not later than 4:00 p.m. on 14th August, 2003 (Hong Kong time).

• Subject to the fulfilment of the conditions of the Underwriting Agreement, the Prospectus Documents are expected to be sent to the Qualifying Shareholders on 19th August 2003.

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WARNING OF THE RISK OF DEALING IN SHARES AND RIGHTS SHARES

The last day of dealings in the Shares on a cum-right basis is expected to be on 12th August, 2003 and the Shares are expected to be dealt in on an ex-rights basis from 13th August, 2003. Dealings in the Rights Shares in nil-paid form are expected to take place from 21st August, 2003 to 29th August, 2003 (both dates inclusive). If the conditions of the Rights Issue (see the section headed “Conditions of the Rights Issue”) are not fulfilled, the Rights Issue will not proceed.

Any dealings in the Shares from now up to the date on which all conditions of the Underwriting Agreement are fulfilled, and any dealings in Shares or Rights Shares in their nil-paid form between 21st August, 2003 to 29th August, 2003 (both dates inclusive) are accordingly at the investors’ own risk.

If in any doubt, investors should consider obtaining professional advice.

The Directors also noted that the recent increase in the price of the Shares and wish to state that the Board is not aware of any reason for such increase.

Resumption of Trading

At the request of the Company, trading in the Shares was suspended with effect from 9:30 a.m. on Tuesday, 29th July, 2003 pending the publication of this announcement. Application has been made to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on Wednesday, 30th July, 2003.

RIGHTS ISSUE

Issue statistics

Basis of the Rights Issue : One Rights Share (in nil-paid form) for every two Shares held by the Qualifying Shareholders as at the close of business on the Record Date at a subscription price of HK$0.08 per Rights Share Number of authorised Shares : 5,000,000,000 Shares Number of existing Shares in issue : 956,403,580 Shares Number of Rights Shares : 478,201,790 Rights Shares

Qualifying Shareholders

The Company will send the provisional allotment letters and application forms for excess Rights Shares to Qualifying Shareholders only.

To qualify for the Rights Issue, a Shareholder must as at the close of business on the Record Date:

• (i) be registered as a member of the Company; and

• (ii) have an address in Hong Kong which appears on the register of members of the Company.

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In order to be registered as members of the Company on the Record Date, Shareholders must lodge any transfer of Shares (together with the relevant share certificate(s)) with the Company’s branch share registrar and transfer office in Hong Kong, Abacus Share Registrars Limited at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong, by not later than 4:00 p.m. (Hong Kong time) on 14th August, 2003.

TERMS OF THE RIGHTS ISSUE

Subscription price

HK$0.08 per Rights Share, payable in full when a Qualifying Shareholder accepts his/her provisional allotment under the Rights Issue or applies for excess Rights Shares or when a transferee of a nil-paid Rights Shares subscribes for the Rights Shares.

The subscription price was arrived at after arm’s length negotiation between the Company and the Major Shareholder with reference to the market price of the Shares under the prevailing market conditions. The Directors consider the terms of the Rights Issue to be fair and reasonable so far as the Shareholders are concerned.

The subscription price of HK$0.08 represents:—

• (i) a discount of approximately 32.20 per cent. to the closing price of HK$0.118 per Share quoted on the Stock Exchange on 28th July, 2003, being the date of the Underwriting Agreement;

• (ii) a discount of approximately 23.81 per cent. to the theoretical ex-rights price of HK$0.105 per Share based on the closing price per Share on 28th July, 2003;

• (iii) a discount of approximately 23.81 per cent. to the 10-day average closing price of HK$0.105 per Share up to and including 28th July, 2003; and

• (iv) a discount of approximately 39.39 per cent. to the 30-day average closing price of HK$0.132 per Share up to and including 28th July, 2003.

Status of the Rights Shares

When fully paid, issued and allotted, the fully-paid Rights Shares will rank pari passu in all respects with the then existing issued Shares. Holders of the fully-paid Rights Shares will be entitled to receive all future dividends and distributions which are declared, made or paid on or after the date of issue and allotment of the fully-paid Rights Shares.

Share certificates

Subject to the fulfilment of the conditions of the Rights Issue, certificates for all fully-paid Rights Shares are expected to be posted to those entitled thereto at their own risk on or before 11th September, 2003.

Closure of register of members

The register of members of the Company will be closed from Friday, 15th August, 2003 to Tuesday, 19th August, 2003 (both dates inclusive). No transfer of Shares will be registered during this period.

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Rights of Non-Qualifying Shareholders

The Prospectus Documents will not be registered or filed under the applicable securities or equivalent legislation of any jurisdictions other than Hong Kong and Bermuda. The Directors will exercise the discretion granted to them under the bye-laws of the Company not to offer the Rights Shares to the Non-Qualifying Shareholders with registered addresses in territories outside Hong Kong where, in the opinion of the Directors, it would or might, be unlawful or impracticable to offer Rights Shares in territories outside Hong Kong. Therefore, the Company will send copies of the Prospectuses (for information only) and the Overseas Letters to Non-Qualifying Shareholders. The Company will not send provisional allotment letters and application forms for excess Rights Shares to Non-Qualifying Shareholders.

The Company will make arrangements for the Rights Shares, which would otherwise have been provisionally allotted to Non-Qualifying Shareholders, to be sold in the market in their nil-paid form as soon as practicable after dealing in the nil-paid Rights Shares commences, if a premium (net of expenses) can be obtained. The proceeds of each sale, less expenses, of HK$100 or more will be paid to Non-Qualifying Shareholders in Hong Kong dollars pro rata to their respective shareholdings as soon as possible. The Company will retain individual amounts of less than HK$100 for its own benefit.

Fractions of Rights Shares

The Company will not provisionally allot fractions of Rights Shares. All fractions of Rights Shares will be aggregated and all nil-paid Rights Shares arising from such aggregation will be sold in the market, if a premium (net of expenses) can be achieved, and the Company will keep the proceeds from such sales.

Application for excess Rights Shares

Qualifying Shareholders may apply for any unsold entitlement of Non-Qualifying Shareholders, any unsold Rights Shares created by adding together fractions of Rights Shares and any Rights Shares provisionally allotted but not accepted. Application for excess Rights Shares may be made by completing the appropriate application form. The Directors will allocate the excess Rights Shares on a fair and reasonable basis but preference will be given to applications for less than one board lot of Shares where it appears to the Directors that such applications have been made to round up an existing holding of an odd lot of Shares.

The remaining excess Rights Shares after the aforesaid preferential allotment will be allotted on the following basis:

If the Rights Shares are undersubscribed

The Directors will allot the remaining excess Rights Shares according to such amount of excess Rights Shares applied for by the Qualifying Shareholders.

If the Rights Shares are oversubscribed

The Directors will firstly allot the remaining excess Rights Shares in proportion to the amount of nil-paid Rights Shares provisionally allotted to those Qualifying Shareholders who apply for excess Rights Shares. Any application for such amount of excess Rights Shares which is less than the amount as calculated herein will be satisfied in full.

Any further remaining excess Rights Shares will be allotted to applicants in proportion to the excess Rights Shares applied by them after netting off their respective entitlements as calculated in the previous paragraph.

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Application for listing

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms.

Dealings in the Rights Shares (in both their nil-paid and fully-paid forms) will be subject to the payment of stamp duty in Hong Kong.

UNDERWRITING ARRANGEMENT

Undertakings from the Major Shareholder

The Major Shareholder, which at the date of this announcement, is interested in 576,754,470 existing Shares, representing approximately 60.30 per cent. of the existing issued share capital of the Company. The Major Shareholder has irrevocably undertaken to the Company during the period immediately after the Record Date and prior to the Final Acceptance Date not to dispose the 576,754,470 Shares and to accept or procure the acceptance of its entitlement of 288,377,235 Rights Shares under the Rights Issue. As at the date of this announcement, the Major Shareholder has indicated that it has not decided whether or not it will apply for any excess Rights Shares.

Underwriting Agreement

Date : 28th July, 2003 Underwriter : The Major Shareholder Number of Rights Shares underwritten : 189,824,555 Rights Shares

The Major Shareholder does not underwrite issues of securities in its normal course of business and will not receive any fee or underwriting commission under the Underwriting Agreement.

In the event that no Rights Shares are subscribed for by the Qualifying Shareholders and the Major Shareholder itself subscribes for all of the Rights Shares under its underwriting obligation pursuant to the Underwriting Agreement, the shareholding of the Major Shareholder will increase to approximately 73.54 per cent. of the total issued share capital of the Company as enlarged by the Rights Issue. Upon the completion of the Rights Issue, the maximum shareholding of the Major Shareholder in the Company would be approximately 73.54 per cent.. Public float would be maintained given that more than 25 per cent. of the issued Shares are held by the public.

Termination of the Underwriting Agreement

The Major Shareholder reserves the right to terminate the arrangements set out in the Underwriting Agreement by notice in writing given by it to the Company at any time prior to 4:00 p.m. on the third business day following the Final Acceptance Date, if in the sole and absolute opinion of the Major Shareholder, after full consultation with the Company:

• (a) the success of the Rights Issue or the taking up of the Rights Shares by Shareholders would be adversely affected by:

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• (i) the introduction of any new law or regulation or any change in existing law or regulation (or the judicial interpretation thereof) or other occurrence of any nature whatsoever which may adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

• (ii) the occurrence, development or coming into effect of any local, national or international event or change (whether or not forming part of a series of events or changes occurring or continuing before, and/or after the date hereof) of a political, military, financial, economic, currency or other nature (whether or not sui generis with any of the foregoing), or in the nature of any local, national or international outbreak or escalation of hostilities or armed conflict; or affecting local securities market or any local, national or international event or series of events (including, without limitation, strikes, lockouts, fire, explosion, flooding, acts of God, accident) or the occurrence of any combination of circumstances which adversely affects the business or the financial or trading position or prospects of the Group as a whole or adversely prejudices the success of the Rights Issue or the taking up of the Rights Shares by the members of the Company or otherwise makes it inexpedient or inadvisable for the Company or the Major Shareholder to proceed with the Rights Issue; or

• (b) any change in market conditions or combination of circumstances in Hong Kong or elsewhere (including without limitation suspension or material restriction or trading in securities) occurs which may adversely affect the success of the Rights Issue (such success being the taking up of the Rights Shares by members of the Company).

Upon the giving of the notice of termination, all obligations of the Major Shareholder under the Underwriting Agreement shall cease and determine and no party shall have any claim against any other parties in respect of any matter or thing arising out of or in connection with the Underwriting Agreement.

Conditions of the Underwriting Agreement

The Underwriting Agreement is conditional on:

• (i) the delivery to and filing with the Registrar of Companies in Bermuda of one printed copy of each of the Prospectus Documents (duly signed by one Director for and on behalf of all the Directors in accordance with the requirements of the Companies Act) after having been approved by resolution of the Board, together with all the documents required to be annexed thereto by the Companies Act by not later than the day before the Allotment Posting Date;

• (ii) the delivery to and filing with the Stock Exchange of one printed copy of each of the Prospectus Documents (duly certified by two Directors (or their duly authorised agents) in writing in accordance with section 348C of the Companies Ordinance) after having been approved by resolution of the Board, together with all other documents required to be annexed thereto and issue by the Stock Exchange of a certificate of authorisation of registration by not later than the Allotment Posting Date;

• (iii) the delivery to and filing with the Registrar of Companies in Hong Kong of one printed copy of each of the Prospectus Documents (duly certified by or on behalf of two Directors (or their duly authorised agents) in writing in accordance with section 342C of the Companies Ordinance) after having been approved by resolution of the Board, together with all the documents required to be annexed thereto by not later than the Allotment Posting Date;

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• (iv) the posting of the Prospectus Documents to Qualifying Shareholders on the Allotment Posting Date and the posting of the Overseas Letter to the Non-Qualifying Shareholders accompanied by a copy of the Prospectus stamped “For Information Only” on the Allotment Posting Date ;

• (v) all requirements imposed by the Stock Exchange under the Listing Rules or otherwise in connection with the transactions contemplated by the Underwriting Agreement have been fully complied with by not later than 15 September 2003 (or such other date as may be agreed between the Company and the Major Shareholder); and

• (vi) the Listing Committee of the Stock Exchange granting or agreeing to grant (subject to allotment), and not having revoked, the approval of the listings of, and permission to deal in the Rights Shares, in their nil-paid form and fully-paid form by no later than 9:00 a.m. on 20th August 2003, (being the expected date of commencement of dealings in the Rights Shares in their nil-paid form) (or such other time and date as may be agreed between the Company and the Major Shareholders) and 9:00 a.m. on 15th September 2003 (being the expected date of commencement of dealings in the Rights Shares in their fully-paid form) (or such other time and date as may be agreed between the Company and the Major Shareholder), respectively,

and so that in the event of the said conditions not being fulfilled by the dates specified above or waived in accordance with the terms of the Underwriting Agreement or if the Underwriting Agreement shall be rescinded in accordance with the terms of the Underwriting Agreement all obligations and liabilities of the parties to the Underwriting Agreement will forthwith cease and determine and no party will have any claim against the others (save for any antecedent breaches thereof).

WARNING OF THE RISK OF DEALING IN SHARES AND RIGHTS SHARES

The last day of dealings in the Shares on a cum-right basis is expected to be on 12th August, 2003 and the Shares are expected to be dealt in on an ex-rights basis from 13th August, 2003. Dealings in the Rights Shares in nil-paid form are expected to take place from 21st August, 2003 to 29th August, 2003 (both dates inclusive). If the conditions of the Rights Issue (see the section headed “Conditions of the Rights Issue”) are not fulfilled, the Rights Issue will not proceed.

Any dealings in the Shares from now up to the date on which all conditions of the Underwriting Agreement are fulfilled, and any dealings in Shares or Rights Shares in their nil-paid form between 21st August, 2003 to 29th August, 2003 (both dates inclusive) are accordingly at the investors’ own risk.

If in any doubt, investors should consider obtaining professional advice.

REASONS FOR THE RIGHTS ISSUE AND USE OF PROCEEDS

The principal activities of the Group are video distribution, film licensing, film sub-licensing film exhibition and leasing of property and machinery for replication of optical discs.

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Despite the unpromising economic situation in Hong Kong and other Asian countries, the audited consolidated turnover of the Group was maintained at approximately HK$306.7 million for the year ended 30th June, 2002 compared with approximately HK$306.6 million for the year ended 30th June, 2001. Although the audited consolidated net profit of the Company was reduced from approximately HK$40.2 million for the year ended 30th June, 2001 to approximately HK$10.0 million for the year ended 30th June, 2002, it is noted that such decline was mainly due to the provision of approximately HK$22.4 million made on the non-recurring impairment for film rights and additional interest of approximately HK$7.0 million on convertible notes accrued for the redemption of the notes in July 2002.

For the six months ended 31st December, 2002, the Group’s unaudited consolidated turnover amounted to approximately HK$158.4 million, representing a slight decrease of approximately 1.2 per cent. over the corresponding period for the previous financial year. Though, a substantial decline in the net profit of approximately 83.1 per cent. down to approximately HK$4.1 million was recorded given the stagnant and sluggish local retail market. In order to maintain the competitiveness of the Group in the industry, the management of the Company intends to expand its PRC operations by strengthening film co-production with film production companies in the PRC and it is believed that such co-operation will enable the Group to capture a respectable share of the PRC market.

In July 2002, the Company has redeemed the outstanding convertible notes of approximately HK$54.1 million out of its internal resources. Given the significant decrease in free cash held by the Company, and in anticipation of the implementation of the aforesaid corporate strategy, it is commercially justifiable for the Group to secure additional cash resources for further development of its business in the PRC, in particular, any business opportunities arising from the deregulation and reformation of laws governing the entertainment industry in the PRC and for general working capital of the Group. The Directors consider that the Rights Issue will provide a fair means of fund raising, which all Shareholders can participate, and will enlarge the capital base of the Company.

The net proceeds of the Rights Issue, after deduction of expenses, are expected to amount to approximately HK$37.7 million and will be applied as to approximately HK$35.0 million for co-producing films with independent film production companies in the PRC. The remaining balance of the net proceeds will be used for general working capital of the Group.

TIMETABLE OF THE RIGHTS ISSUE

The expected timetable for the Rights Issue is set out below:

Last day of dealings in Shares on a cum-rights basis ..............................................Tuesday, 12th August, 2003

First day of dealings in Shares on an ex-rights basis ..........................................Wednesday, 13th August, 2003 Latest time for lodging transfers of Shares in order to qualify for the Rights Issue ........................................................... 4:00 p.m. on Thursday, 14th August, 2003

Book closure period (both dates inclusive) ............. Friday, 15th August, 2003 to Tuesday, 19th August, 2003 Record Date................................................................................................................Tuesday, 19th August, 2003 Prospectus Documents expected to be despatched on .............................................Tuesday, 19th August, 2003 First day of dealings in nil-paid Rights Shares ...................................................... Thursday, 21st August, 2003

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Latest time for splitting nil-paid Rights Shares.................................. 4:00 p.m. on Tuesday, 26th August, 2003

Last day of dealings in nil-paid Rights Shares ............................................................Friday, 29th August, 2003

Latest time for acceptance of and payment for Rights Shares

and application for excess Rights Shares .............................. 4:00 p.m. on Wednesday, 3rd September, 2003

Rights Issue expected to become unconditional on ....................... 4:00 p.m. on Monday, 8th September, 2003

Refund cheques in respect of wholly or partially unsuccessful applications

for excess Rights Shares expected to be despatched on or before............... Thursday, 11th September, 2003

Certificates for fully-paid Rights Shares expected to be

despatched on or before................................................................................. Thursday, 11th September, 2003

Dealings in fully-paid Rights Shares expected to commence on ...................... Monday, 15th September, 2003

Dates or deadlines specified in this announcement for events in the timetable for (or otherwise in relation to) the Rights Issue are indicative only and may be extended or varied by the Company. Any changes to the anticipated timetable for the Rights Issue will be published or notified to Shareholders appropriately.

GENERAL

The Company will despatch the Prospectus Documents to each of the Qualifying Shareholders and the Prospectus (for information only) and the Overseas Letter to each of the Non-Qualifying Shareholders, as soon as practicable.

The Directors noted that the recent increase in the price of the Shares and wish to state that the Board is not aware of any reason for such increases. Save as disclosed above, the Directors confirm 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 of the Listing Agreement, which is or may be of a price-sensitive nature.

RESUMPTION OF TRADING

At the request of the Company, trading in the Shares was suspended with effect from 9:30 a.m. on Tuesday, 29th July, 2003 pending the publication of this announcement. Application has been made to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on Wednesday, 30th July, 2003.

Terms used in this announcement

“Allotment Posting Date”

19th August, 2003, being the date for the despatch of the Prospectus Documents to the Qualifying Shareholders and the Prospectuses (for information only) and the Overseas Letters to the Non-Qualifying Shareholders or such other date as may be agreed between the Company and the Major Shareholder

“Board”

the board of Directors

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“business day”	a day (other than a Saturday or a day on which a tropical cyclone warning
	signal no. 8 or above or a “black” rainstorm morning signal is hoisted in
	Hong Kong at any time between 9:00 a.m. and 4:00 p.m.) on which banks in
	Hong Kong are generally open for business
“Company”	Universe International Holdings Limited, a company incorporated in
	Bermuda with limited liability, the shares of which are listed on the Stock
	Exchange
“Companies Act”	the Company Act 1981 of Bermuda
“Companies Ordinance”	the Companies Ordinance (Chapter 32 of the Laws of Hong Kong)
“Director(s)”	the director(s) of the Company
“Final Acceptance Date”	3rd September, 2003 or such other date as may be agreed between the
	Company and the Major Shareholder and described as the latest time for
	acceptance and payment in respect of provisional allotments under the Rights
	Issue
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s Republic of
	China
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange
“Major Shareholder”	Globalcrest Enterprises Limited, a company incorporated in the British Virgin
	Islands with limited liability, being the major shareholder of the Company
	interested in approximately 60.30 per cent. of the existing issued share capital
	of the Company, which is owned by a discretionary trust of which certain
	immediate family members of Mr. Lam and Ms. Chiu are discretionary
	objects
“Mr. Lam”	Mr. Lam Shiu Ming, Daneil, the Chairman of the Company
“Ms. Chiu”	Ms. Chiu Suet Ying, an executive Director
“Non-Qualifying Shareholders”	Shareholders whose addresses as shown on the register of members of the
	Company on the Record Date are outside Hong Kong
“Overseas Letter”	a letter from the Company to the Non-Qualifying Shareholders advising
	them of the arrangement of their entitlements under the Rights Issue
“PRC”	the People’s Republic of China and for the purpose of this announcement
	excluding Hong Kong
“Prospectus”	the prospectus to be issued by the Company in relation to the Rights Issue

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“Prospectus Documents”

the Prospectus, the provisional allotment letter and form of application for excess Rights Shares

• “Qualifying Shareholder(s)” Shareholder(s) whose names appear on the register of members of the Company on the Record Date, other than the Non-Qualifying Shareholders

• “Record Date” 19th August, 2003, being the date for ascertaining entitlements to the Rights Issue, as described in this announcement, or such other date as may be agreed between the Company and the Major Shareholder

• “Rights Issue” the issue by the Company by way of rights to Qualifying Shareholders of 478,201,790 Rights Shares at a price of HK$0.08 per Rights Share on the basis of one Rights Share for every two Shares held by Qualifying Shareholders on the Record Date, subject to the terms and conditions set out in this announcement and the Prospectus Documents

• “Rights Shares” the new Shares to be issued pursuant to the Rights Issue “Share(s)” share(s) of HK$0.02 each in the share capital of the Company “Shareholder(s)” holder(s) of the Share(s) “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Underwriting Agreement” agreed to underwrite 189,824,555 Rights Shares

• “HK$” Hong Kong dollars, the lawful currency of Hong Kong

the underwriting agreement entered into on 28th July, 2003 between the Company and the Major Shareholder whereby the Major Shareholder has agreed to underwrite 189,824,555 Rights Shares

By Order of the Board Lam Shiu Ming, Daneil Chairman

Hong Kong, 29th July, 2003

* For identification purpose only

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

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