10:44     CHEUNG TAI HONG<00199> - Announcement & Resumption (13)             

    that such other methods of financing would be less                        
    preferable and effective than the Subscription and                        
    the Placing in view of the size of the new capital                        
    to be raised and the relatively higher cost and longer                    
    time involved in other funding arrangement such as                        
    rights issue, open offer and bank borrowings. The                         
    Board considers the Subscription and the Placing as                       
    the best available fund-raising methods for future                        
    possible acquisitions when such opportunities are                         
    identified.                                                               
                                                                              
    The total gross proceeds from the Subscription amount                     
    to HK$956 million. Assuming all the Placing                               
    Convertible Notes are successfully placed by the                          
    Placing Agent, the total gross proceeds from the                          
    Placing amount to HK$44 million. Therefore, the                           
    maximum total gross proceeds from the Subscription                        
    and the Placing amount to HK$1,000 million. After                         
    deducting related expenses of approximately HK$4                          
    million, approximately HK$996 million will be                             
    available for the Group. It is intended that all of                       
    the net proceeds will be used for expanding the                           
    investment properties portfolio of the Company when                       
    opportunities arise. As at the date of this                               
    announcement, the Board has not identified any                            
    specific property to invest in.                                           
                                                                              
    ADJUSTMENTS OF THE CONVERSION PRICE OF 2005 FEBRUARY                      
    CONVERTIBLE NOTES AND SUBSCRIPTION PRICE OF THE SHARE                     
    OPTIONS                                                                   
    According to the terms of 2005 February Convertible                       
    Notes and the rules of the Share Option Schemes, as                       
    a result of the Subscription and/or the Placing,                          
    adjustments may need to be made to the conversion                         
    price of the 2005 February Convertible Notes ("2005                       
    February Conversion Price") and the subscription                          
    price of the Share Options ("Subscription Price").                        
    Upon completion of the Subscription and/or the                            
    Placing, the Company will notify the holder(s) of the                     
    2005 February Convertible Notes and the Share Options                     
    respectively in relation to any adjustment to the 2005                    
    February Conversion Price and the Subscription Price.                     
    As at the date of this announcement, the principal                        
    amount of the 2005 February Convertible Notes                             
    outstanding was HK$90 million, representing an                            
    entitlement of approximately 214,285,714 Shares upon                      
    full conversion. The number of Shares to be issued                        
    under the Share Options granted as at the date of this                    
    announcement was 27,300.                                                  
                                                                              
    GENERAL                                                                   
    Kopola is 50% held by Mr. Ho, the deputy chairman and                     
    independent non-executive Director, and therefore an                      
    Associate of Mr. Ho. As Mr. Ho is a connected person                      
    of the Company under Rule 14A.11 of the Listing Rules,                    
    Kopola is regarded as a connected person of the                           
    Company as well under Rule 14A.11 of the Listing Rules.                   
    The subscription of Subscription Convertible Notes                        
    by Kopola constitutes a connected transaction of the                      
    Company under Rule 14A.13(1)(a) of the Listing Rules.                     
    Accordingly, the subscription by Kopola is subject                        
    to the approval of the independent Shareholders on                        
    which voting shall be taken by poll. Kopola and its                       
    Associates have no shareholding interests in the                          
    Company as at the date of this announcement. The                          
    directors and chief executive of the Company and their                    
    respective associates and party acting in concert                         
    with any of them will abstain from voting in the SGM                      
    on the resolutions to approve the creation and issue                      
    of the Subscription Convertible Notes and the Placing                     
    Convertible Notes and the issue and allotment of new                      
    Shares resulting from the exercise of the conversion                      
    rights attached to the relevant