09:26     CH N RES DEV<00661> - Announcement (4)                              

    announcement will be made by the Company when the appointments have been  
    confirmed.                                                                
                                                                              
    Clarifications                                                            
                                                                              
    There have been recent press articles in the newspapers in Hong Kong in   
    which it was alleged that Mr. Zhou has been arrested and is being         
    detained in Shenzhen in the People's Republic of China ("PRC") by the     
    Qingdao Public Security Bureau in relation to an alleged deception and    
    his financial conditions.                                                 
                                                                              
    The Directors (including the independent non-executive Directors) hereby  
    confirm that they do not know (i) the source of the information on which  
    the matters reported in the press articles are based nor (ii) the         
    accuracy or reliability of the matters reported.                          
                                                                              
    The Directors (including the independent non-executive Directors) are of  
    the considered view that the matters reported in the press articles are   
    not expected to have a material adverse impact on the management,         
    financial or operating position of the Group as:                          
                                                                              
    (a)        the Group is under the proper management of the current        
    directors and senior management of the Company and the business of the    
    Company is running as usual despite the fact that Mr. Zhou is no longer   
    a director of the Company;                                                
                                                                              
    (b)        except that Mr. Zhou was a Director and is a controlling       
    shareholder of the Company, there is no other relationship and/or         
    business dealings between any members of the Group and Mr. Zhou (or in    
    business dealings in which Mr. Zhou is a party);                          
                                                                              
    (c)        based on the internal and financial records and enquiries      
    made with the personnel of the Group (including the financial controller  
    and the chief executive officer of the Company) who are responsible for   
    maintaining the internal and financial records of the Group:              
                                                                              
    (i)        Mr. Zhou has not provided any financial assistance, including  
    granting credit, lending money, providing security for or guaranteeing    
    loans, to the Group;                                                      
                                                                              
    (ii)         the Company is not aware of there being any demand made for  
    repayment of debts owed by Mr. Zhou;                                      
                                                                              
    (iii)         the Group is not insolvent or unable to pay its debts       
    (which are incurred in the ordinary course of businesses of the Group)    
    when they fall due;                                                       
                                                                              
    (d)        the Board is not aware of, and none of the internal and        
    financial records and enquiries made with the financial controller and    
    chief executive officer respectively of the Company, have revealed that,  
    there being:                                                              
                                                                              
    (i)        any amount due from Mr. Zhou or his associates (as defined in  
    the Listing Rules) to the Group; or                                       
                                                                              
    (ii)        any pledge of interests in shares of the Company by Mr. Zhou  
    to secure the debts of the Group or to secure any guarantees or other     
    support of the obligations of the Group; or                               
                                                                              
    (iii)        any guarantees provided by the Group or any assets of the    
    Group pledged to other parties to secure any loans or other facilities    
    granted to Mr. Zhou or his associates (as defined in the Listing Rules);  
                                                                              
    (e)        during the telephone conversation with Mr. Zhou on 19 April    
    2005, Mr. Zhou indicated that the matters reported in the press articles  
    were personal matters which had nothing to do with the Group;             
                                                                              
    (f)        the Directors are not aware of there being any circumstances   
    which suggest that the matters reported in the press articles are         
    related to the Group; and                                                 
                                                                              
    (g)        the Group has not entered into any loan agreement which is     
    discloseable under Rule 13.18 of the Listing Rules.                       
                                                                              
    The Company had a telephone discussion with Mr. Zhou about the Share      
    Transactions proposed by BSRAP on 17 April 2005. Later on, Mr. Zhou       
    contacted with the Company by telephone on 19 April 2005 and expressed    
    that he was in the PRC and aware of the matters reported in the press     
    articles in Hong Kong and would deal with it (if necessary) when he come  
    back to Hong Kong. Furthermore, it was confirmed by Mr. Zhou during the   
    telephone enquiry that the Company had with him on 24 April 2005 that     
    there was no negotiation or arrangement for the disposal of his           
    controlling stake in the Company but Mr. Zhou did not respond to the      
    Company's enquiry as to whether there was any pledge of his shares in     
    the Company. If the Board becomes aware of any circumstances arising