10:15 CAPITAL STRAT<00497>CAPITAL ESTATE<00193>-JA&<00193>Resume2 Offeror to the Disposal has been obtained. Capital Strategic has applied to the Executive Director of the Corporate Finance Division of the Securities and Futures Commission (the "Executive") to seek a ruling that the Disposal is not a frustrating action for the purposes of Rule 4 of the Code or alternatively, if the Executive rule that the Disposal is a frustrating action for the purposes of Rule 4 of the Code, to waive the requirement to obtain shareholders' approval in connection with the Disposal. (2) Proposed placing of Convertible Notes On 5 January 2005, the Company and the Placing Agent entered into the CB Placing Agreement, pursuant to which, the Placing Agent has agreed to place, on a fully underwritten basis, to not fewer than six independent professional, corporate or individual investors the Convertible Notes, which are proposed to be issued in an aggregate principal amount of HK$36.4 million. The Convertible Notes will carry a right to convert into new Shares at the conversion price of HK$0.028 per Share (subject to adjustment). The Conversion Price of HK$0.028 represents (i) a discount of about 9.68% to the closing price of HK$0.0310 per Share as quoted on the Stock Exchange on the Last Trading Date; (ii) a premium of about 10.24% over the average closing price per Share of about HK$0.0254 as quoted on the Stock Exchange for the last five trading days up to and including the Last Trading Date; and (iii) a premium of about 17.65% over the average closing price per Share of HK$0.0238 as quoted on the Stock Exchange for the last ten trading days up to and including the Last Trading Date. The net proceeds from the CB Placing will be about HK$35.6 million. The aggregate net proceeds from the Top-Up Subscription and the CB Placing of about HK$52.4 will be used for property development and investment in Macau for retail and commercial purposes. No application will be made for listing of the Convertible Notes. Application will be made to the Listing Committee of the Stock Exchange for the listing of and permission to deal in the Shares falling to be issued upon exercise of the Convertible Notes. The CB Placing is conditional upon, amongst other things, the Stock Exchange granting the listing of, and permission to deal in, the Conversion Shares and the passing of the relevant resolution for the approval of the issue of the Convertible Notes at the EGM. (3) Proposed refreshment of general mandate The Top-Up Subscription Shares will be allotted and issued pursuant to the general mandate to allot, issue and deal with Shares granted to the Directors by a resolution passed at the annual general meeting of the Company held on 16 December 2004 and such general mandate is granted on the basis of the issued share capital of the Company comprising 3,269,398,668 Shares on that date. At the date of this announcement, the existing general mandate has not been utilized and based on the number of Shares in issue as at the date of the said resolution, 653,879,733 new Shares can be issued under the existing general mandate. As a result, such existing general mandate will be utilized by the Placing and the board of Directors proposes to refresh the general mandate. The refreshment of the general mandate is subject to the Shareholders' approval at an EGM. A circular of the Company containing, amongst other things, further details of the CB Placing and the refreshment of General Mandate, together with notice of EGM will be despatched to the Shareholders as soon as practicable. Shareholders should note that completion of each of the Top-Up Subscription Agreement and the CB Placing Agreement are conditional. Shareholders and potential investors should exercise caution when dealing in the Shares.