WH Group Limited — Capital/Financing Update 2002

May 8, 2002

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.

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

==> picture [47 x 46] intentionally omitted <==

PREMIUM LAND LIMITED

(Incorporated in Bermuda with limited liability)

PROPOSED (1) PRIVATE PLACING OF WARRANTS AND (2) GRANT OF GENERAL MANDATE TO ISSUE SHARES

Placing Manager

==> picture [31 x 31] intentionally omitted <==

KINGSTON SECURITIES LIMITED

The Directors are pleased to announce that on 8 May 2002, the Warrant Placing Agreement was entered into between the Company and the Placing Manager in relation to a private placing of Warrants at an issue price of HK$0.05 per unit of subscription rights of the Warrants on a fully underwritten basis.

The Warrants entitle the holders to subscribe for the New Shares at an initial subscription price of HK$0.36 per New Share for a period of 12 months commencing on the date of allotment and issue of the Warrants. Completion is subject to the conditions stated herein. The Company intends to apply the net proceeds from the Warrant Placing of approximately HK$26 million for general working capital or reduction of the Group’s liabilities or other suitable projects when opportunities are identified and as Directors think appropriate. The New Shares will be issued under the general mandate granted to the Board at the special general meeting of the Company on 24 April 2002.

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Warrants and the New Shares which may fall to be issued upon exercise of the subscription rights attaching to the Warrants.

The Board also proposes to seek the approval of the Shareholders to grant the General Mandate to issue further Shares. A circular containing further details of the grant of General Mandate to issue Shares and a prospectus containing details of the Warrants will be issued to the Shareholders as soon as practicable.

The Directors have noted the increase in trading volume of the Shares on 7 May 2002 and would like to state that they are not aware of any reasons for such increase except for the Warrant Placing, the terms of which were first negotiated and concluded after the market closes on 7 May 2002. The Directors have confirmed 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.

Trading of the Shares on the Stock Exchange was suspended at 9:30 a.m. on 8 May 2002, at the request of the Company pending the release of this announcement. Application has been made to the Stock Exchange for the resumption of trading of the Shares at 9:30 a.m. on 9 May 2002.

– 1 –

(1) WARRANT PLACING AGREEMENT

Date

8 May 2002

Warrant Placing

Issuer : The Company Placing Manager : Kingston Securities Limited Number of Warrants : HK$539,840,000 units Warrant Issue Price : HK$0.05 Subscription Price : HK$0.36

The Warrant Issue Price and the Subscription Price were negotiated on an arm’s length basis between the Company and the Placing Manager. The Subscription Price represents: (i) a premium of approximately 1.41% over the closing price of HK$0.355 per Share as quoted on the Stock Exchange on 7 May 2002, being the last trading day prior to the suspension of trading of Shares on 8 May 2002; and (ii) a premium of approximately 15.35% over the average closing price of HK$0.3121 per Share as quoted on the Stock Exchange for the last 10 trading days up to and including 7 May 2002. The aggregate of the Warrant Issue Price and the Subscription Price represents: (i) a premium of approximately 15.49% over the closing price of HK$0.355 per Share as quoted on the Stock Exchange on 7 May 2002; and (ii) a premium of approximately 31.37% over the average closing price of HK$0.3121 per Share as quoted on the Stock Exchange for the last 10 trading days up to and including 7 May 2002.

Independence

The Placing Manager and its beneficial owner are independent of and not connected with any of the directors, chief executive or substantial shareholders of the Company and any of its subsidiaries, or any of their respective associates (as defined in the Listing Rules). The Placing Manager will also procure that the Placees be, independent of and not connected with any of the directors, chief executive or substantial shareholders of the Company and any of its subsidiaries, or any of their respective associates (as defined in the Listing Rules), or a party acting in concert with Mr Dong Bo, the controlling shareholder of the Company, for the purposes of the Hong Kong Code on Takeovers and Mergers.

Transferability

The Warrants can be freely transferred.

Completion Date

It is expected that the Warrant Placing Agreement will be completed on or before 23 June 2002, after the fulfillment of the conditions referred to in the section headed “Conditions of the Warrant Placing” below (or such later date as the Placing Manager and the Company may agree in writing).

– 2 –

Terms of the Warrants

The Warrants will rank pari passu in all respects among themselves. Holders of the Warrants are entitled to subscribe for New Share at the Subscription Price. The Warrants can be exercised within a period of 12 months commencing on the date of allotment and issue of the Warrants. The New Shares, when issued and fully paid, will rank pari passu in all respects with the then existing issued Shares. Warrants can be exercised in the multiples of 40,000 units.

Upon full exercise of the subscription rights attaching to the Warrants, a total of 539,840,000 New Shares will fall to be issued, representing approximately 20.00% of the existing issued share capital of the Company of 2,699,365,970 Shares and approximately 16.67% of the issued share capital of the Company of 3,239,205,970 Shares as to be enlarged by the issue of New Shares from the full exercise of the subscription rights attaching to the Warrants. The New Shares will be issued under the general mandate granted to the Board at the special general meeting of the Company on 24 April 2002

Conditions of the Warrant Placing

Completion shall be subject to and conditional upon:

• (1) the Listing Committee of the Stock Exchange granting approval for the listing of, and permission to deal in, all the Warrants and any Shares falling to be issued on the exercise of the subscription rights attaching to the Warrants either unconditionally or subject to conditions to which the Company accepts by no later than 4:00 p.m. on 28 May 2002 (Hong Kong time) (or such later time or date as the parties may agree);

• (2) the delivery to and registration by the Registrar of Companies in Hong Kong of a copy of each of the prospectus and the application form, each duly signed by any two of the Directors (or by their agents duly authorised in writing) and having annexed to it all documents required to be annexed thereto, in accordance with Section 348C of the Companies Ordinance by no later than 4:00 p.m. on 27 May 2002 (Hong Kong time) (or such later time or date as the parties may agree); and

• (3) the delivery to and filing with the Registrar of Companies in Bermuda of a copy of the prospectus and the application form duly signed by one Director (for and on behalf of the other Directors) in accordance with the Companies Act by no later than 4:00 p.m. on 27 May 2002 (Hong Kong time) (or such later time or date as the parties may agree).

Voting Rights for the Holders of the Warrants

The holders of the Warrants will not have any right to attend or vote at any meeting of the Company by virtue of their being the holders of the Warrants.

Reason for the Warrant Placing

The Board believes that the Warrant Placing is an appropriate means of fund raising for the Company. The Warrant Placing should not have immediate dilutive effect on the shareholding of the existing Shareholders. In addition to the net proceeds that will be raised upon Completion, further share capital will be raised upon the exercise of the subscription rights attaching to the Warrants by the holders of the Warrants during the subscription period.

– 3 –

The Group is planning to expand its business and to undertake property investment and/or development projects in the PRC, if opportunities arise in light of the future growth of the property market in the PRC. The Directors believe the demand for residential and commercial property in the coastal regions in the PRC will increase in the future. The Directors are of the view that the net proceeds from the Warrants and the capital investment arising from the issue of the New Shares may enable the Group to achieve the above plan.

The Board considers that the terms of the Warrant Placing, which have been arrived at after arm’s length negotiations between the Company and the Placing Manager, are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

Use of proceeds

The gross proceeds from the Warrant Placing would be HK$26.99 million. The net proceeds from the Warrant Placing would be approximately HK$26 million. The Directors consider the Warrant Placing represents an opportunity to raise capital for the Company whilst broadening the shareholder base and capital base of the Company. The Company intends to use the net proceeds for the Company’s general working capital or reduction of the Group’s liabilities or other suitable projects when opportunities are identified and as the Directors think appropriate.

(2) GENERAL MANDATE TO ISSUE SHARES

At the SGM, the Shareholders will also be asked to consider and, if thought fit, to approve by way of an ordinary resolution the grant of the General Mandate. The Directors believe that the General Mandate is in the best interests of the Company and the Shareholders as it will allow the Company to take advantage of market conditions to raise additional capital for the Company as and when appropriate. Up to the date of this announcement, the Board did not have any concrete plan in utilising the General Mandate.

INFORMATION ON THE GROUP

The principal activity of the Company is property investment and development, securities trading and investment holding in Hong Kong and the PRC.

GENERAL

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Warrants and the New Shares which may fall to be issued upon exercise of the subscription rights attaching to the Warrants.

The Directors will use their effort to ensure that the issue of the Warrants will comply with all relevant provisions of the Listing Rules including Appendix 6 of the Listing Rules.

A circular containing further details of the grant of general mandate to issue Shares will be issued to the Shareholders as soon as practicable. In addition, a prospectus containing details of the Warrants will be issued and sent to Shareholders as soon as possible.

– 4 –

The Directors have noted the increase in trading volume of the Shares on 7 May 2002 and would like to state that they are not aware of any reasons for such increase except for the Warrant Placing, the terms of which were first negotiated and concluded after the market closes on 7 May 2002. The Directors have confirmed 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.

SUSPENSION AND RESUMPTION OF TRADING OF SHARES

Trading of the Shares on the Stock Exchange was suspended at 9:30 a.m. on 8 May 2002, at the request of the Company pending the release of this announcement. Application has been made to the Stock Exchange for the resumption of trading of the Shares at 9:30 a.m. on 9 May 2002.

DEFINITIONS

“Board”	the board of Directors
“Companies Act”	the Companies Act 1981 of Bermuda
“Companies Ordinance”	Companies Ordinance (Chapter 32 of the Laws of Hong Kong)
“Company”	Premium Land Limited, the securities of which are listed on the
	Stock Exchange
“Completion”	completion of the Warrant Placing
“Directors”	the directors of the Company
“General Mandate”	a general and unconditional mandate to the Directors to allot, issue
	and otherwise deal with new shares with an aggregate nominal
	amount not exceeding 20% of the aggregate nominal amount of
	the share capital of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“New Share(s)”	new Share(s) which may fall to be issued upon the exercise of the
	subscription rights attaching to the Warrant(s)
“Placees”	more than six selected independent professional, institutional and
	other investors
“PRC”	People’s Republic of China

– 5 –

“SGM”	a special general meeting of the Company to be convened to
	consider for the granting of the General Mandate
“Share(s)”	common share(s) of HK$0.01 each in the capital of the Company
“Shareholders”	holders of the Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Subscription Price”	an initial subscription price of HK$0.36 per New Share (subject to
	adjustment) at which holders of the Warrants may subscribe for
	the New Shares
“Warrant(s)”	539,840,000 listed warrants to be issued by the Company which
	entitle holders thereof to subscribe for one New Share at the
	Subscription Price at any time for a period of 12 months
	commencing on the date of allotment and issue of the Warrants
“Warrant Issue Price”	HK$0.05 per unit of Warrant to be issued pursuant to the Warrant
	Placing
“Warrant Placing”	a private placing of the Warrants at the Warrant Issue Price on a
	fully underwritten basis
“Warrant Placing Agreement”	a conditional placing underwriting agreement dated 8 May 2002
	made between the Company and the Placing Manager in relation
	to the Warrant Placing
“HK$”	Hong Kong dollars, lawful currency of Hong Kong
“%”	per cent

By the order of the board Premium Land Limited Dong Bo, Frederic Chairman

8 May 2002, Hong Kong

“Please also refer to the published version of this announcement in the Hong Kong i-Mail”.

– 6 –