09:26     GOLDBOND GROUP<00172> - Announcement (5)                            

    100%                                                                      
    Sino Dynasty                                                              
    25%                                                                       
    Wah Link                                                                  
    25%                                                                       
    Bateson                                                                   
    50%                                                                       
    Nanjing City Plaza                                                        
    67%                                                                       
    Nanjing International                                                     
                                                                              
    The Company through Sino Dynasty effectively owns approximately 16.7%     
    shareholding in Nanjing International. Wah Link, a non-wholly owned       
    subsidiary of Wah Link Investments, is beneficially owned as to 51% by    
    a family member of Mr. Wong Yu Lung, Charles, a Director and Chief        
    Executive Officer of the Company, and 49% by his spouse, Mrs. Wong Fang   
    Pik Chun and thus an associate of Mr. Wong and a connected person of      
    the Company. Bateson (formerly known as Y&W Holdings Limited) is an       
    independent third party not connected with the directors, chief           
    executive and substantial shareholders of the Company or Wah Link or      
    any of their respective subsidiaries and/or their respective              
    associates. In addition, shareholders of the remaining 33% interest in    
    Nanjing International are independent third parties not connected with    
    the directors, chief executive and substantial shareholders of the        
    Company or Wah Link or Bateson or any of their respective subsidiaries    
    and/or their respective associates.                                       
                                                                              
    The Nanjing Project is planned to be developed in two phases. Phase I     
    of the Nanjing Project is under construction and is expected to be        
    completed in 2006, which will comprise a shopping mall, serviced          
    apartments, hotel and office premises, with a total gross floor area of   
    approximately 227,000 square metres. Phase II is at planning stage with   
    a total gross floor area of approximately 218,000 square metres.          
                                                                              
    REASONS FOR AND BENEFITS OF THE FUNDING AGREEMENT                         
                                                                              
    The Group is principally engaged in, among others, property investment    
    and investments in finance industries in Hong Kong and the PRC. As set    
    out in the interim report of the Company for the six months ended 30      
    September 2004, the Group takes every opportunity to expand its           
    strategic business developments in property and finance industries with   
    proactive approach.                                                       
                                                                              
    As mentioned in the Nanjing Circular, Phase I of the Nanjing Project is   
    under construction and is expected to be completed in 2006 and Phase II   
    of the Nanjing Project is at its planning stage. The Facility was         
    obtained in facilitating the construction of Phase I of the Nanjing       
    Project. As one of the shareholders of Nanjing City Plaza, the Company    
    entered into the Funding Agreement (including the provisions of such      
    funding undertakings and buy-back undertakings under the Funding          
    Agreement) in order to provide security for the Facility up to the        
    percentage of the Facility, which is equivalent to its proportional       
    interest in Nanjing International, to facilitate the construction of      
    Phase I of the Nanjing Project in which the Company has a 16.7%           
    indirect interest. According to the research conducted by the Company,    
    the prevailing market price of premium residential units of similar       
    quality to those of the Nanjing Project in the nearby areas, on           
    average, is more than RMB10,000 per square metre. In view of the above,   
    the Directors believe that the unit price offered by Nanjing              
    International is fair and reasonable and will be no less favourable       
    than such unit price to be offered to independent third parties. In       
    addition, as the Group can acquire residential units at discount to the   
    prevailing market price under the Funding Agreement (in events of         
    default mentioned above), which the Directors consider that such          
    arrangement to be beneficial for the Group.                               
                                                                              
    Based on the above, the Directors (including the independent              
    non-executive Directors) consider that the entering into of the Funding   
    Agreement, the Allocation Agreement and the Distribution Agreement were   
    entered into on normal commercial terms (or better) and the terms         
    thereof are fair and reasonable and in the interest of the Company and    
    the shareholders of the Company as a whole.                               
                                                                              
    GENERAL                                                                   
                                                                              
    A circular containing, among others, further details of the Funding       
    Agreement and the Distribution Agreement and transactions contemplated    
    thereunder will be despatched to the shareholders of the Company as       
    soon as practicable.                                                      
                                                                              
    DEFINITIONS                                                               
                                                                              
    "Allocation Agreement"  the agreement entered into by Wah Link            
    Investments, Bateson, Nanjing International and the Company dated 17