11:22     HK CONSTRUCTION<00190> - Announcement (3)                           

    principal business of APC is investment holding of                        
    the Project Companies. The remaining 30% of the issued                    
    capital of APC is owned by another independent third                      
    party.                                                                    
                                                                              
    To the best of the Directors' knowledge and after                         
    having made all reasonable enquiry, the Transferor,                       
    APC and their respective ultimate beneficial owners                       
    are independent third parties to the Company, are not                     
    connected persons of the Company and are not connected                    
    to the directors, chief executive or substantial                          
    shareholders of the Company, or its subsidiaries or                       
    any of their respective associates (as defined in the                     
    Listing Rules).                                                           
                                                                              
    Sinoriver is a wholly-owned subsidiary of the                             
    Company.                                                                  
                                                                              
    Assets  Under the Equity Transfer Agreement I, 29%                        
    of the registered capital of Project Company                              
      involved in   I held by the Transferor will be                          
    transferred to Sinoriver free from all charges,                           
      the subject   encumbrances and third party rights.                      
    Under this agreement, the Transferor has also                             
      transactions: agreed to transfer 51% of the                             
    registered capital of Project Company I to APC. The                       
    remaining 20% equity interest of Project Company I                        
    will remain to be held by the Transferor.                                 
                                                                              
    Under the Equity Transfer Agreement II, 75% of the                        
    registered capital of Project Company II held by the                      
    Transferor will be transferred to Sinoriver free from                     
    all charges, encumbrances and third party rights. The                     
    remaining 25% equity interest of Project Company II                       
    will remain to be held by the Transferor.                                 
                                                                              
    Pursuant to the MOU (which is legally binding on the                      
    parties to it), Sinoriver has granted the Option in                       
    favour of APC for nil consideration. The Option is                        
    exercisable by APC within 3 months after completion                       
    of capital contribution to Project Company II,                            
    whereupon Sinoriver will sell to APC 10% of the                           
    registered capital of Project Company II held by                          
    Sinoriver after completion of Equity Transfer                             
    Agreement II at a price equal to the amount of capital                    
    contribution actually made by Sinoriver to such 10%                       
    registered capital plus interest at the rate of 6%                        
    per annum. The terms of the Option were agreed and                        
    negotiated between Sinoriver and APC on an arm's                          
    length basis reflecting their respective commercial                       
    objectives. The Directors consider that they are fair                     
    and reasonable and in the interests of the Company                        
    and the Shareholders as a whole.                                          
                                                                              
    Consideration:  As the registered capital of Project                      
    Company I has not been contributed by the Transferor,                     
    the consideration for Sinoriver's acquisition of the                      
    29% registered capital of Project Company I is nil.                       
                                                                              
    As the registered capital of the Project Company II                       
    will not be contributed by the Transferor prior to                        
    completion of the transfer, the consideration for                         
    Sinoriver's acquisition of the 75% registered capital                     
    of Project Company II is also nil.                                        
                                                                              
    Sinoriver will, upon completion of the transfers, be                      
    obliged to contribute its pro rata share of registered                    
    capital of the Project Companies, i.e. Sinoriver will                     
    contribute HK$29 million in the case of Project                           
    Company I, and HK$75 million in the case of Project                       
    Company II (subject to exercise of the Option by APC                      
    whereupon APC, as shareholder of the 10% registered                       
    capital of Project Company II, will