09:52 CS CONSERVAT P<00351>-Announcement&Resumption of Trading (2) According to the S&P Agreement, Abba China may unilaterally waive the above condition precedent (c). Apart from the above, none of the other conditions precedent may be waived by any party. Completion Completion shall take place on the third business day after the day on which the last unfulfilled conditions is satisfied or, if applicable, waived or such other day as may be agreed between Mr. Pang and Abba China. Information of Sino Profit Sino Profit is a company incorporated in the British Virgin Islands on 16 March 2004 with limited liability. It is wholly-owned by Mr. Pang and its principal business is investing in waste incineration and processing business. Upon completion of the S&P Agreement, Sino Profit shall become a wholly-owned subsidiary of the Company and its financial statements will be consolidated with that of the Company. The Company understands from Mr. Pang that Sino Profit is a company solely for the purpose of developing waste incineration and processing business in Meizhou, the PRC. As at the date of the S&P Agreement, Sino Profit does not have any assets or incur any liabilities. It has not conducted any businesses save for the signing of the Xingning Agreement, the S&P Agreement, the Co-Operative Agreement and such other documents incidental to the aforesaid agreements. On 26 January 2005, Sino Profit entered into the Xingning Agreement with the City Administrative Bureau of Xingning City whereby Sino Profit was granted a right to construct and operate the Incinerator with a capacity to handle 600 metric tons of waste per day with energy produced being used for generating electricity in Xingning City, Meizhou, the PRC either on its own or via a project company, at such terms and conditions as specified therein and at a total investment amount of RMB233.70 million (equivalent to approximately HK$220.47 million). Sino Profit is also granted a priority right to invest in further incinerator(s) in Xingning City, Meizhou, the PRC should the City Administrative Bureau of the Xingning City decides to do so in future. Sino Profit also entered into the Co-Operative Agreement dated 19 April 2005 with New Rise whose principal business is investing in waste incineration and processing business whereby Sino Profit and New Rise agreed to set up the Meizhou JV for the waste incineration and processing business in Xingning, Meizhou, the PRC, of which the principal terms are as follows:- Parties: Sino Profit and New Rise New Rise is beneficially owned by Mr. Chan Chun Wai ("Mr. Chan") and Ms. Tin Yuen Sin Carol ("Ms. Tin") in equal shares. To the best of the Directors' knowledge, information and belief having made all reasonable enquires, New Rise and its beneficial owners are Independent Third Parties, they are also independent from and not connected with Mr. Pang and Sino Profit. As at the date of this announcement, Ms. Tin and Mr. Chan are interested in 3,000,000 and 700,000 Shares respectively. Equity ratio: The Meizhou JV will be owned as to 80% by Sino Profit and as to 20% by New Rise. Registered capital: The registered capital of the Meizhou JV will be RMB80 million (equivalent to approximately HK$75.47 million) and to be contributed as to RMB64 million (equivalent to approximately HK$60.38 million) by Sino Profit, as to RMB16 million (equivalent to approximately HK$15.09 million) by New Rise, in proportion to their respective equity interest in the Meizhou JV. Total investment: The total investment of the Meizhou JV will be RMB233.70 million (equivalent to approximately HK$220.47 million). The portion of the total investment in excess of the registered capital in the amount of RMB153.70 million (equivalent to approximately HK$145 million) will be raised by the Meizhou JV by way of external borrowings or loan from Sino Profit and New Rise in proportion to their respective equity interest in the Meizhou JV. In the event that Sino Profit is required to finance any portion of the total investment amount in excess of the registered capital of the Meizhou JV according to the proportion of its equity interest therein and provided that the S&P Agreement can be completed, the Company may finance such amount from its internal resources, external borrowing, or other fund-raising activities. As completion of the S&P Agreement is subject to a number of conditions precedent and the formation of the Meizhou JV is subject to approval by the relevant PRC authorities, the Company has not formulated any plan in relation thereto for the time