09:36     SHANGHAI GROWTH<00770> - Announcement (4)                           

    parties agreed that with effect from 30 June 2003, no Incentive Fee       
    shall be payable to the Investment Manager if the Net Asset Value per     
    Share of the Company (being the Net Asset Value as at 31 December of      
    the relevant year divided by the number of Share in issue at such date)   
    is less than US$6.20, and thereafter such threshold shall be adjusted     
    annually (or such other period as the Board deems appropriate)            
    according to the actual amount of special dividends paid out by the       
    Company during the immediately preceding year(s) and that any such        
    adjustments shall be approved by the Board in accordance with the         
    Articles.                                                                 
                                                                              
    Apart from the above amendment to the Investment Management Agreement,    
    the other terms of the Investment Management Agreement remained           
    unchanged. On 17 October 2003, the Company received confirmation from     
    the Stock Exchange that the Waiver granted by the Stock Exchange on 9     
    February 2001 was still valid and the conditions stated therein           
    remained unchanged.                                                       
                                                                              
    THE FOURTH SUPPLEMENTAL AGREEMENT                                         
                                                                              
    On 11 April 2005, the Company and the Investment Manager entered into     
    the Fourth Supplemental Agreement whereby the parties have agreed to,     
    inter alia, amend and extend the term of appointment of the Investment    
    Manager under the Investment Management Agreement.                        
                                                                              
    The Fourth Supplemental Agreement is conditional upon the receipt of      
    all necessary approvals of the Independent Shareholders to be obtained    
    at the AGM. In the event that the necessary approvals of the              
    Independent Shareholders, are not granted, the Fourth Supplemental        
    Agreement shall lapse.                                                    
                                                                              
    Upon the Fourth Supplemental Agreement becoming unconditional, the        
    following amendments will be made to the Investment Management            
    Agreement:                                                                
                                                                              
    (1)  that the appointment of the Investment Manager under the             
    Investment Management Agreement is extended for a term of three years     
    commencing from 1 July 2005 and the Investment Manager shall be           
    entitled to resign its appointment under the Investment Management        
    Agreement, and the Company may by resolution of the Board terminate the   
    appointment of the Investment Manager, in either case by giving not       
    less than two months notice in writing to the Company or the Investment   
    Manager to expire on or within one month of 30 June 2008; and             
                                                                              
    (2)  that the total fees payable to the Investment Manager, consisting    
    of the Management and Administration Fee calculated pursuant to Clause    
    7.01 of the Investment Management Agreement and the Incentive Fee, if     
    payable according to Clause 7.02 of the Investment Management             
    Agreement, for each of the following periods of the term of the           
    Investment Management Agreement as supplemented by the Fourth             
    Supplemental Agreement shall not exceed the corresponding amount set      
    out in a new Clause 7.03A to be inserted in the Investment Management     
    Agreement, as indicated below:                                            
                                                                              
    Period  Amount                                                            
                                                                              
    From 1 July 2005 to 31 December 2005 inclusive  US$1,400,000              
    (approximately HK$10,920,000)                                             
                                                                              
    For the year 2006  US$1,200,000 (approximately HK$9,360,000)              
                                                                              
    For the year 2007  US$1,200,000 (approximately HK$9,360,000)              
                                                                              
    From 1 January 2008 to 30 June 2008 inclusive  US$600,000                 
    (approximately HK$4,680,000)                                              
                                                                              
    Each of the above amounts is referred to as the "New Cap" or              
    collectively, as the "New Caps" in this announcement. Subject to the      
    above amendments, the other terms of the Investment Management            
    Agreement including the basis for calculation of the Management and       
    Administration Fee and the Incentive Fee according to Clauses 7.01 and    
    7.02 of the Investment Management Agreement respectively, shall remain    
    the same.                                                                 
                                                                              
    Shareholders should note that the New Cap provided for the period 1       
    July 2005 to 31 December 2005 inclusive takes into consideration of       
    both the Management and Administration Fee, which is payable by the       
    Company to the Investment Manager pursuant to Clause 7.01 of the          
    Investment Management Agreement in relation to the stated period, and     
    an Incentive Fee, which is expected to be payable by the Company          
    pursuant to Clause 7.02 of the Investment Management Agreement being      
    15% of the amount by which the Net Asset Value of the Listed              
    Investments Portfolio exceeds 115% of the Net Asset Value of the Listed   
    Investments Portfolio as at 31 December 2004 compared with that of 31