09:44 CHINA VELOCITY<00149> - Announcement (1) 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. China Velocity Group Limited (Incorporated in Bermuda with limited liability) (Stock Code: 149) DISCLOSEABLE TRANSACTION: DISPOSAL OF INTEREST IN SUBSIDIARY The Directors announce that on 25 February 2005, the Agreement was entered into between the Vendor and the Purchaser which sets out the terms in respect of the proposed disposal of the Sale Shares for the aggregate purchase price of HK$40,000,000. The Disposal constitutes a discloseable transaction of the Company under the Listing Rules. A circular of the Company in relation to the Disposal will be dispatched to shareholders of the Company as soon as reasonably practicable. Agreement dated 25 February 2005 Parties: The Vendor, Hongkong Macau (International) Limited, a wholly owned subsidiary of the Company; and The Purchaser, Always Rich Resources Inc. To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, the Purchaser and its ultimate beneficial owner, Wang Yung-Tyng, are Independent Third Parties. The Company was not acquainted with the Purchaser before it was approached by the Purchaser directly with an offer. Interest Disposed: 40 ordinary shares of US$1.00 each in the share capital of More Cash, representing 40% of the entire issued share capital of More Cash. Consideration: HK$40,000,000, which has been determined at arm's length negotiation with reference to the negative net asset value of More Cash and its subsidiaries of approximately HK$417,468,043 based on its consolidated management accounts as at 31 December 2004, and taking into account an independent valuation of the Property of HK$160,000,000 done by BMI Appraisals Limited, an independent firm of professional valuers, on an open market basis as at 31 December 2004. The Directors consider that the terms of the transaction are fair and reasonable and in the interests of the Company and the shareholders of the Company as a whole. HK$1,000,000 has been paid by the Purchaser to the Vendor as deposit and part payment of the Consideration upon signing of the Agreement. The Purchaser is obliged to pay or procure the payment of the balance of the Consideration of HK$39,000,000 to the Vendor on the Completion Date. The deposit of HK$1,000,000 paid by the Purchaser shall be non- refundable except in the event that the condition precedents are not fulfilled on or before the date immediately before the Completion Date. Conditions Precedent: Completion is conditional upon satisfaction of the following conditions: (i) the representations, warranties and undertakings or indemnities made or given by the Vendor to the Purchaser in the Agreement remaining true and accurate and not misleading in any material respect at Completion; (ii) the Vendor having complied fully with its pre-completion undertakings stipulated in the Agreement; and (iii) each of the Purchaser, the Vendor and the Company having obtained all necessary consents and approvals from third parties (including governmental or official authorities or agencies) required under applicable laws and the Listing Rules. If the condition precedents are not fulfilled on or prior to the date immediately before the Completion Date, the Agreement shall terminate and none of the parties shall have any claim of any nature against the other party except for any claim for rights and liabilities accrued prior thereto (save in respect of the non-refundable deposit referred to in the section headed "Consideration" above).