10:12 NEW CITY<00456> - Announcement (1) The Stock Exchange takes no responsibility for the contents of this announcement and 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. NEW CITY (BEIJING) DEVELOPMENT LIMITED (Incorporated in the Cayman Islands with limited liability) Stock Code: 0456 ISSUE OF 3% CONVERTIBLE BOND DUE 2007 IN THE PRINCIPAL AMOUNT OF HK$12 MILLION The directors of the Company announce that the Company has entered into the Subscription Agreement whereby the Subscriber has agreed to subscribe for a convertible bond in the principal amount of HK$12 million to be issued by the Company at a conversion price of HK$0.30 per Share. Assuming full conversion of the Convertible Bond at the Conversion Price, the Convertible Bond will be convertible into 40,000,000 fully-paid Shares, representing approximately 14.7% of the issued share capital of the Company as at the date of this announcement and approximately 12.8% of the enlarged issued share capital of the Company. The Conversion Shares will be issued pursuant to the general mandate given to the Directors by resolution of the shareholders of the Company at the annual general meeting of the Company held on 25 June 2004. Completion of the arrangements contemplated under the Subscription Agreement and the issue of the Convertible Bond shall take place on the third business day after fulfillment (or the waiving) of the conditions precedent set out in the Subscription Agreement or on such other date the parties may agree. If the conditions precedent are not fulfilled (or waived) on or prior to 30 June 2005 or such later date as may be agreed between the parties, the Subscription Agreement shall terminate. Trading in the Shares has been suspended on the Stock Exchange since 30 December 2003 at the request of the Company pending release of an announcement in relation to a possible major transaction of the Company involving China Securities Plaza. The Company has yet to demonstrate to the satisfaction of the Stock Exchange that it has sufficient level of operation or tangible assets of sufficient value to warrant the continued listing of the Share on the Stock Exchange pursuant to Rule 13.24 of the Listing Rules in light of such agreement relating to China Securities Plaza and the very substantial disposal as referred to the Company's circular dated 28 August 2004. Accordingly, the Company was placed into the second stage of the delisting procedures on 12 January 2005. The Company is now actively preparing further information including its projected assets position after completion of the China Securities Plaza transaction for submission to the Stock Exchange in order to substantiate that it meets the requirements under Rule 13.24. The Company will issue the announcement in relation to China Securities Plaza as soon as possible. Trading in the Shares will remain suspended pending release of such announcement and fulfillment of any conditions which may be imposed on the Company by the Stock Exchange. INTRODUCTION The directors of New City (Beijing) Development Limited ("Company") announce that the Company has entered into a conditional subscription agreement dated 2 February 2005 ("Subscription Agreement") whereby Tritime Holdings Limited (the "Subscriber") has agreed to subscribe for a convertible bond ("Convertible Bond") in the principal amount of HK$12 million issued by the Company which are convertible into Shares. New Shares will be issuable upon conversion of the Convertible Bond and will rank pari passu in all respects with the existing shares of HK$0.001 each in the share capital of the Company ("Share") and will be issued pursuant to the general mandate given to the Directors by resolution of the shareholders of the Company at the annual general meeting of the Company held on 25 June 2004. Application will be made to The Stock Exchange of Hong Kong Limited ("Stock Exchange") for the listing of, and permission to deal in, the Shares to be issued upon conversion of the Convertible Bond. USE OF PROCEEDS The net proceeds from the issue of the Convertible Bond, expected to be approximately HK$11.8 million after deducting expenses, will be used for working capital. It is not the current intention of the Company to use the net proceeds for the repayment of bank borrowings or construction of China Securities Plaza. PRINCIPAL TERMS OF THE CONVERTIBLE BOND AND THE ISSUE