09:00 NAN FENG GROUP<00979>-Announcement&Resumption of Trading(2) Placing Agent Kingston Securities Limited is the Placing Agent and will receive a placing commission of 2.5% on the gross proceeds of the Placing paid by the Company, which was arrived at after arm's length negotiations between the Company and the Placing Agent. The Placing Agent and its ultimate beneficial owners are not connected persons (as defined in Listing Rules) of the Company and are third parties independent of the Company and its connected persons. Placees Not fewer than six placees (the "Placees") who and whose respective ultimate beneficial owners (i) will not be a connected person (as defined in Listing Rules) of the Company; (ii) is independent of and not connected with the Company, its connect persons and other Placees; and (iii) will not be acting in concert (as defined in the Takeovers Code) with the Vendor and its concert parties or any of the directors, chief executive or substantial shareholder(s) of the Company or any of its subsidiaries or their respective associates (as defined in Listing Rules). No Placees will become a substantial Shareholder of the Company. Placing Price The Placing Price is fixed on 23 March 2005, being the date of the Placing Agreement. The Placing Price (or the Top-Up Subscription Price) of HK$0.08 represents (i) a discount of about 10.11% to the closing price of HK$0.089 per Share as quoted on the Stock Exchange on the Last Trading Date; (ii) a discount of about 12.28% to the average closing price per Share of about HK$0.0912 as quoted on the Stock Exchange for the last five trading days up to and including the Last Trading Date; and (iii) a discount of about 11.01% over the average closing price per Share of HK$0.0899 as quoted on the Stock Exchange for the last ten trading days up to and including the Last Trading Date . The Placing Price was negotiated on an arm's length basis between the Company and the Placing Agent. The Directors consider that the terms of the Placing and the Top-Up Subscription are fair and reasonable based on the current market conditions and in the interests of the Company and its Shareholders as a whole. The Placing Shares The Placing Shares (or the Top-Up Subscription Shares) of 98,900,000 Shares represent (i) about 11.57% of the existing issued share capital of the Company of 854,770,446 Shares; and (ii) about 10.37% of the issued share capital of the Company of 953,670,446 Shares as enlarged by the Top-Up Subscription. Ranking of Placing Shares The Placing Shares rank pari passu among themselves and with Shares in issue as at the date of this announcement. Condition of the Placing The Placing is unconditional. THE TOP-UP SUBSCRIPTION AGREEMENT Date 23 March 2005 Parties involved The Company and the Vendor The Top-Up Subscription Price The Top-Up Subscription Price is HK$0.08 per Share. The Top-Up Subscription Price is the same to the Placing Price and was determined after arm's length negotiation between the Company and the Vendor with reference to the Placing Price of the Placing Shares. Number of Top-Up Subscription Shares The number of Top-Up Subscription Shares is equivalent to the number of Placing Shares, being 98,900,000 Shares. Ranking of Top-Up Subscription Shares The Top-Up Subscription Shares, when issued and fully paid, will rank pari passu among themselves and with Shares in issue at the time of issue and allotment of the Top-Up Subscription Shares. Conditions The Top-Up Subscription is conditional upon: