09:28     SINO-I TECH<00250> - Announcement (3)                               

    payment obligation as described above occur, the Purchaser may            
    only claim against Mr. Yu for payment in the manner described,            
    but may not claim or take any other action (including legal               
    proceedings) against the Company for compensation or for the              
    refund of all or any part of the consideration under the Disposal.        
                                                                              
    (4)     Acesite (Phils.) Hotel                                            
                                                                              
    Acesite (Phils.) Hotel owns the Property and is principally               
    engaged in the operation of the hotel under the name of "Manila           
    Pavilion Hotel" in Manila, the Philippines. The ordinary stocks           
    of Acesite (Phils.) Hotel are currently listed on the Philippines         
    Stock Exchange.                                                           
                                                                              
    The audited net asset value of Acesite (Phils.) Hotel (prepared           
    in accordance with accounting principles generally accepted in            
    the Philippines) as at 31 December 2003 and 31 March 2003 were            
    approximately HK$151,549,000 and HK$155,938,000 respectively.             
    The audited net profits of Acesite (Phils.) Hotel before and              
    after taxation and extraordinary items (prepared in accordance            
    with accounting principles generally accepted in the Philippines)         
    for the nine months ended 31 December 2003 were approximately             
    HK$5,850,000 and HK$1,712,000 respectively. The audited net               
    losses before and after taxation and extraordinary items                  
    (prepared in accordance with accounting principles generally              
    accepted in the Philippines) for the year ended 31 March 2003             
    were approximately HK$8,377,000 and HK$9,199,000 respectively.            
                                                                              
    (5)     First Foundation                                                  
                                                                              
    First Foundation is a company incorporated in the British Virgin          
    Islands and, through its wholly owned subsidiary, is interested           
    in 2,658,234 ordinary shares in Acesite (Phils.) Hotel,                   
    representing about 2.66% of its total issued stock capital, all           
    of which shares are free from encumbrances and third party rights.        
    Other than such interest, First Foundation holds no other assets.         
                                                                              
    Based on the management accounts, the net asset value of First            
    Foundation and its subsidiary as at 30 June 2004, 31 December             
    2003 and 31 March 2003 were approximately HK$5,978,000,                   
    HK$5,978,000 and HK$6,008,000 respectively. The net loss of               
    First Foundation and its subsidiary before and after taxation             
    and extraordinary items for the six months ended 30 June 2004             
    was both approximately HK$1,000. The net loss before and after            
    taxation and extraordinary items for the nine months ended 31             
    December 2003 was both approximately HK$30,000. The net loss              
    before and after taxation and extraordinary items for the year            
    ended 31 March 2003 was both approximately HK$10,000.                     
                                                                              
    Current structure of the group of companies under the Disposal:           
                                                                              
    Note:   The 75% interest is the subject of the Proceedings, details       
    of which are described in the section headed "Acesite" above.             
                                                                              
    Consideration:                                                            
                                                                              
    The total consideration is a sum of RMB212,000,000, which was             
    arrived at after arm's length negotiations among the parties              
    taking into account the parties' assessment of the Proceedings            
    and the related claims, the asset values of Acesite (Phils.)              
    Hotel and CIMA Realty.                                                    
                                                                              
    Payment Terms                                                             
                                                                              
    The total consideration shall be paid in cash as follows: