ZHONGHUI HOLDINGS LTD (UNDER JUDICIAL MANAGEMENT) Company Registration No R (Incorporated in the Republic of Singapore)

Transcription

1 ZHONGHUI HOLDINGS LTD (UNDER JUDICIAL MANAGEMENT) Company Registration No R (Incorporated in the Republic of Singapore) ZHONGHUI HOLDINGS LTD (UNDER JUDICIAL MANAGEMENT) (THE COMPANY ) EXECUTION OF CONDITIONAL SALE AND PURCHASE AGREEMENT 1. INTRODUCTION 1.1 General The Judicial Managers had announced on 31 March 2010 that they had on behalf of the Company entered into an In-Principle Agreement with Rising Tyre Co. Limited (the Target ) on the acquisition of the Target The Judicial Managers are pleased to announce that the Company has on 30 April 2010 entered into a conditional sale and purchase agreement (the "S&P Agreement") with the Target, the persons listed in Appendix 1 (the Vendors and each a Vendor ) and the persons listed in Appendix 2 (the LN Holders and each an LN Holder ) (each a Party and collectively, the Parties ) for the acquisition by the Company of the Vendors interests in the entire issued and fully paid-up share capital of the Target (the Sale Shares ) (the Proposed Share Acquisition ) and the acquisition by the Company of the LN Holders rights, benefits, titles and interests in, to and under certain loan notes issued to the LN Holders by the Target (details of which are set out at Paragraph 1.3 below) (the Secured Loan Notes ) (the Proposed LN Acquisition ) The purchase consideration for the Proposed Share Acquisition and the Proposed LN Acquisition (collectively, the Proposed Acquisitions ) will be satisfied by the issue of new ordinary shares in the issued and fully paid-up share capital of the Company ( Shares ) and the payment of cash to the LN Holders. The details of the purchase consideration are described at Paragraph 2.4 below. 1.2 Information on Vendors and Sale Shares The Vendors (as listed in Appendix 1) collectively own the entire issued and fully paid-up share capital of the Target. Each of the Vendors is the beneficial owner of the number of Sale Shares as set out against their respective names in Appendix Information on LN Holders and Secured Loan Notes Pursuant to certain legal documents entered into amongst the LN Holders (comprising mainly investment funds), the Vendors and the Target (collectively the LN Documents ), the Target had issued loan notes to the LN Holders representing in aggregate a total of US$16.5 million (in principal monies) advanced by the LN Holders to the Target (the Secured Loan Notes ) in the proportion as set out in Appendix 2. Pursuant to the terms of the LN Documents, the Secured Loan Notes are convertible into ordinary issued and fully paid-up shares of the Target and are secured by several security documents entered into between, inter alia, some of the Vendors, the Target and the LN Holders For the purpose of the S&P Agreement, the LN Holders will not be converting the Secured Loan Notes into shares of the Target but will transfer all the Secured Loan Notes to the Company at the consideration set out in Paragraph 2.4 below.

2 1.4 Information on Target The Target is a company limited by shares incorporated in the British Virgin Islands and its wholly-owned subsidiary, Linyi Unique Tyre Co., Ltd, is a company incorporated in the People s Republic of China (the PRC ) (collectively the Target Group and Target Group Companies, and Target Group Company shall mean any one of them) The Target Group is principally engaged in carrying on the business of manufacturing tyres and inner tubes for bicycles, motorcycles and mopeds and has its operations based in the PRC. They currently manufacture and sell two-wheeler tyres and inner tubes under the Zhengxing, Heiyan and Delince trademarks. The products of the Target Group are sold in the PRC in various provinces, municipalities and autonomous regions and also in overseas markets spanning nineteen countries in the African, Asian, European, Middles Eastern, North American and South American regions The Target previously applied for listing on the Singapore Exchange Securities Trading Limited ( SGX-ST ) and was given an Eligibility-to-List letter on 2 September 2008, which was subsequently extended on 11 December However, due to the market conditions then, the Target decided to postpone its listing plans More detailed information regarding the Target Group (including its financial information) will be set out in the Circular (as defined below at Paragraph 3.2.2) to be despatched to the shareholders in due course. 2. DETAILS OF THE PROPOSED ACQUISITIONS 2.1 Acquisition Sale Shares Subject to the terms and conditions of the S&P Agreement, each of the Vendors shall, as legal and beneficial owner, sell, and the Company shall, relying on inter alia the separate warranties made by the Vendors and the Target, purchase, the Sale Shares, free from all encumbrances and together with all rights and advantages attaching thereto. 2.2 Acquisition Secured Loan Notes Subject to the terms and conditions of the S&P Agreement and in connection with the Proposed Share Acquisition, each of the LN Holders shall, as legal and beneficial owner, sell, and the Company shall purchase, the LN Holders rights, benefits, titles and interests in, to and under Secured Loan Notes. 2.3 Placement In connection with the Proposed Share Acquisition and the Proposed LN Acquisition, the Company will be carrying out a placement of new Shares ( Placement Shares ) constituting up to 20.5% of the post-completion (as defined below) share capital of the Company ( Placement ) at a valuation of not less than five (5) times the audited and consolidated net profits after tax of the Target Group for financial year ended 31 December 2009 (the Agreed Valuation ) The completion of the Proposed Share Acquisition, the Proposed LN Acquisition and the Placement are expected to take place concurrently ( Completion ) on the date falling seven business days after the satisfaction or waiver (as the case may be) of the conditions precedent set out in Paragraph 2.5 below ( Completion Date ) Purchase Consideration

3 2.4.1 Under the S&P Agreement, subject to the adjustment in Paragraph below (where applicable), and on the basis that the Placement is conducted at the Agreed Valuation, the consideration for the purchase of the Sale Shares and the Secured Loan Notes shall be fully satisfied by the following (the Purchase Consideration ): (a) (b) (c) the allotment and issue of such new Shares each credited as fully paid-up, to each of the Vendors (and/or such person(s) as any of them may notify the Company and agreed by the Company) at the Agreed Valuation (assuming that the Placement is conducted at the Agreed Valuation), which in aggregate amounts to % of the post-completion enlarged share capital of the Company and amounting to a total value of approximately RMB 312,081,550 (the Consideration Shares ); the allotment and issue of such new Shares, each credited as fully paid-up, to each of the LN Holders (and/or such person(s) as any of them may notify the Company and agreed by the Company) at a discount of 15% to the Agreed Valuation (assuming that the Placement is conducted at the Agreed Valuation), which in aggregate amounts to approximately 17.7% of the post-completion enlarged share capital of the Company and amounting a total value of approximately US$13.5 million (the LN Consideration Shares ); and the payment of US$6 million (the LN Cash Portion ) to the LN Holders The Consideration Shares and LN Consideration Shares shall, when issued and credited as fully paid-up, rank pari passu in all respects with the existing issued Shares and be subject to such moratorium requirements as may be required by the Listing Manual, the SGX-ST and/or the agent for the Placement ( Placement Agent ), save that in respect of any moratorium undertaking required of the LN Holders solely by the Placement Agent (an not by the Listing Manual or the SGX-ST), the Placement Agent and the LN Holders will discuss in good faith on the orderly disposal of the LN Consideration Shares and the Placement Agent and the LN Holders shall not unreasonably reject any disposal scheme arising therefrom In the event that the Placement can be conducted at a valuation higher than the Agreed Valuation, the Company, the Vendors and the LN Holders shall discuss further the adjustments to be made to the cash and shares portion of the Purchase Consideration and if they fail to reach any written agreement on such adjustments, then the Placement shall proceed base on the Agreed Valuation and the Purchase Consideration shall remain as that set out at Paragraph above. 2.5 Conditions Precedent Completion is conditional upon the fulfilment of the following (the Conditions Precedent ) by 31 December 2010 (the Long Stop Date ), unless waived by the relevant party: (a) (b) (c) the completion of a legal and financial due diligence exercise by the Company on the Vendors and the Target Group and the results of such exercise being reasonably satisfactory to the Company; the completion of a legal and financial due diligence exercise by the Vendors on the Company and the results of such exercise being reasonably satisfactory to the Vendors; the scheme of arrangement to be proposed by the Company to its creditors under Section 210 of the Companies Act (Cap 50) of Singapore (the Scheme of

4 Arrangement ) having been approved by the shareholders of the Company and all creditors of the Company to be included in the Scheme of Arrangement (the Scheme Creditors ) and such other necessary party(ies), and such approval not having been revoked or amended and, where such approval is subject to conditions, such conditions shall be acceptable to the Parties and to the extent that any of the conditions are required to be fulfilled on or before the Completion Date, they are so fulfilled; (d) (e) (f) (g) (h) (i) the Scheme of Arrangement having been sanctioned by the High Court of Singapore and where such sanction is subject to conditions, such conditions shall be acceptable to the Parties and to the extent that any of the conditions are required to be fulfilled on or before the Completion Date, they are so fulfilled; the carrying out of all terms and transactions contemplated in the Scheme of Arrangement (and to the extent possible) thereafter; the approval of the Judicial Managers of the Company having been obtained for the transactions contemplated in the S&P Agreement and the Scheme of Arrangement, including but not limited to the proposed capital reduction exercise to be carried out by the Company as contemplated under the Scheme of Arrangement for the purpose of cancelling the paid-up share capital of the Company unrepresented by available assets (the Proposed Capital Reduction ), the transfer of the debts of the Company due and owing to the Scheme Creditors to ZECC, the commencement of the liquidation of ZECC and the issue of Shares to the Scheme Creditors in consideration of such transfer (the Proposed Debt Restructuring Shares ) (the Proposed Debt Restructuring ) and the share consolidation exercise to be carried out by the Company (in respect of the Shares) as contemplated under the Scheme of Arrangement (the Proposed Share Consolidation ), if required; the approval of the shareholders of the Company at such general meeting to be held for the purpose of passing the necessary resolutions (including the Whitewash Resolution (as defined below) for the purpose of approving and authorising the carrying out by the Company of the transactions contemplated in the S&P Agreement, the Scheme of Arrangement and the Placement, including the issue and allotment of the Consideration Shares, the LN Consideration Shares, the Shares to be issued to the Scheme Creditors pursuant to the Scheme of Arrangement (the Proposed Debt Restructuring Shares ) and the Placement Shares; the completion of the Proposed Capital Reduction, the Proposed Share Consolidation and the Proposed Debt Restructuring (other than the issue of the Proposed Debt Restructuring Shares) before the issue of the Consideration Shares, the LN Consideration Shares, the Proposed Debt Restructuring Shares and the Placement Shares; the Securities Industry Council ( SIC ) having granted the Vendors, the Scheme Creditors, the LN Holders and their relevant concert parties a waiver of their obligation to make a mandatory offer under Rule 14 of the Singapore Code on Take-Overs and Mergers arising from the issue of the Consideration Shares, the LN Consideration Shares and the Proposed Debt Restructuring Shares pursuant to the terms and conditions of the S&P Agreement and the Scheme of Arrangement, such waiver not having been revoked, repealed or amended, and such waiver being subject to: (i) any conditions that the SIC may impose, such conditions being acceptable to the Vendors, the LN Holders and the Company (to the

5 extent that any condition imposed relates to matters to be fulfilled or complied with by the applicable Party), and to the extent that any such conditions are required to be fulfilled on or before Completion, they are so fulfilled; and (ii) the resolution of the shareholders of the Company (who are independent of the transactions contemplated under the S&P Agreement and/or the Scheme of Arrangement), such resolution having been passed at a general meeting of the shareholders of the Company, for the waiver of their rights to receive a mandatory take-over offer from the Vendors, the LN Holders, the Scheme Creditors and/or their concert parties (the Whitewash Resolution ) having been obtained; (j) (k) (l) (m) (n) approval having been obtained from the SGX-ST in respect of the transactions contemplated herein (including but not limited to the sale and purchase of the Sale Shares and the Secured Loan Notes) being granted or obtained and the compliance with all requirements under the SGX-ST Listing Manual being fulfilled, and such fulfilment and approval being in full force and effect and not having been withdrawn, suspended, amended or revoked, and if such approval is granted or obtained subject to any conditions, such conditions being fulfilled on or before Completion, including but not limited to the approval in-principle being granted by the SGX-ST pursuant to the additional listing application by the Company (the Additional Listing Application ) for the listing and quotation of the Consideration Shares, the LN Consideration Shares the Proposed Debt Restructuring Shares and the Placement Shares pursuant to the terms and conditions of the S&P Agreement, the Scheme of Arrangement and the agreement between the Company and such relevant third parties setting out the terms of the Placement (the Placement Agreement ); all approvals and consents as may be necessary from any third party, governmental or regulatory body or relevant competent authority having jurisdiction over the transactions contemplated under the S&P Agreement or to the entry into and completion of the S&P Agreement by the Parties, being granted or obtained, and being in full force and effect and not having been withdrawn, suspended, amended or revoked, and if such consents or approvals are granted or obtained subject to any conditions, such conditions being reasonably acceptable to the Parties; the Company being satisfied in its reasonable discretion, that the business of the Target Group and any Target Group Company has been carried on in a satisfactory manner, and all approvals and consents (including any governmental, regulatory and/or corporate approvals and consents) required for the business of each of the Target Group Companies have been obtained, and are and shall remain on Completion valid and effective and not withdrawn or amended; no material adverse change (as determined by the Company in its reasonable discretion) in the prospects, operations or financial conditions of the Target Group or any Target Group Company occurring on or before the Completion Date; the Vendors being reasonably satisfied that, as at Completion Date, all existing liabilities of the Company and its subsidiaries and associated companies (collectively, the Group and the Group Companies and individually, a Group Company ) (other than ZECC) have been included and dealt with under the Scheme of Arrangement;

6 (o) (p) (q) (r) (s) (t) (u) (v) (w) (x) (y) the terms of the Disclosure Letter (if any) in respect of the Warranties (as defined below) being reasonably acceptable to the Company; the execution and performance of the S&P Agreement by the Parties thereto not being prohibited, restricted, curtailed, hindered, impaired or otherwise adversely affected by any relevant statute, order, rule, directive or regulation promulgated by any legislative, executive or regulatory body or authority; the termination on Completion Date of the appointment of all the directors of the Company from the board of directors of the Company and the appointment of persons nominated by the Vendors in substitution thereof to take effect on Completion Date in compliance with any requirements of SGX-ST; the Parties representations, warranties and undertakings (the Warranties ) under the S&P Agreement being complied with, true, accurate and correct as at the date of the S&P Agreement and each day up to and including the Completion Date and there being no breach of any of the terms and conditions as set out under the S&P Agreement; the execution of the Placement Agreement which shall set out the terms of the Placement on such terms to be agreed between the Company and such relevant third parties, including but not limited to the Placement being conducted based on a valuation of at least the Agreed Valuation, and confirmation by the Placement Agent that it has received the proceeds for such Placement; the execution by the Vendors, the LN Holders and United Overseas Bank Limited, where required, of an undertaking to comply with such moratorium requirements on the transfer or disposal of its shareholding interests in the Company following Completion, in accordance with the Listing Manual or as prescribed by the SGX- ST or as may be reasonably required by the Placement agent, save that, in respect of any moratorium undertaking required of the LN Holders solely by the Placement agent (and not by the Listing Manual or as prescribed by the SGX-ST), the Placement agent and the LN Holders will discuss in good faith on the orderly disposal of the LN Consideration Shares and the Placement agent and the LN Holders shall not unreasonably reject any disposal scheme arising therefrom; the receipt by the Company on Completion Date of a legal opinion or legal opinions confirming that the S&P Agreement and such other documents executed by the Vendors and the LN Holders in connection with or ancillary to the S&P Agreement, when executed by the Vendors and the LN Holders, constitute legally binding, valid and enforceable obligations of the Vendors and the LN Holders; the execution by the key employees identified in the S&P Agreement of service agreements with the Company or the relevant Target Group Companies for a period of not less than two years and on such other terms reasonably acceptable to the Company; the commencement of the liquidation of ZECC (pursuant to the Proposed Debt Restructuring); the execution of the LN Extension Agreement and (where applicable) the LN Discharge Documents by the parties thereto; and there being no transaction or exercise which would result in a change in control of the Target Group or any Target Group Company on or before Completion Date

7 save as such transaction or exercise is contemplated in the S&P Agreement or unless prior approval of the Scheme Creditors is sought If any of the Conditions Precedent is not fulfilled by the relevant Party or is not waived by any Party entitled to do so (save for those Conditions Precedent that need to be fulfilled pursuant to the requirements of the SGX-ST, SIC and/or the Courts of Singapore, as applicable) by the Long Stop Date, the S&P Agreement shall ipso facto cease and determine and none of the Parties shall have any claim against the other for costs, damages, compensation or otherwise, save for any claim by a Party against the other arising from antecedent breaches of the terms hereof and save that the Parties obligation of confidentiality under the S&P Agreement shall survive the termination of the S&P Agreement, provided always that such termination shall not prejudice the respective rights and liabilities of the LN Holders and the Target under the LN Documents which shall not be affected or prejudiced by the terms of the S&P Agreement. 3. OTHER SALIENT TERMS OF THE S&P AGREEMENT 3.1 Vendors and Target s Undertakings Pending Completion, the Vendors and the Target are required to observe certain undertakings with regard to the status, assets, liabilities and operations of the Target Group. 3.2 Compliance with SGX-ST Requirements Each Party undertakes to the other Party that pending Completion it shall render such assistance and co-operate in such manner as may be reasonably necessary to enable the Company to make an Additional Listing Application to the SGX-ST for the listing and quotation of the Consideration Shares, the LN Consideration Shares, the Proposed Debt Restructuring Shares and the Placement Shares pursuant to the terms and conditions of the S&P Agreement, the Scheme of Arrangement and the Placement Agreement on the main board of the SGX-ST and shall execute all documents and do all such acts and things as may be necessary for such purposes The Parties note that the Company will prepare and issue to its shareholders a circular (the Circular ) setting out inter alia details and information on the Target Group Companies and the business of the Target Group, for the purpose of seeking approval of the shareholders of the Company in relation to inter alia the transactions contemplated under the S&P Agreement at an extraordinary general meeting of the Company to be convened. The Parties also note that the Company will have to obtain the approval of the SIC, the SGX-ST, the Scheme Creditors and such other necessary party(ies) (the Approving Parties ) in respect of the transactions contemplated in the S&P Agreement. The Vendors, LN Holders and the Target also agree and undertake to provide all necessary assistance and information to the Company in connection with the preparation of such Circular and to obtain all such approvals from the Approving Parties, and represents, warrants and undertakes that all information, including but not limited to information in respect of themselves or any Target Group Company provided to the Company and included in the Circular or provided to the Approving Parties shall be true, correct and complete in all material respects and there are no facts the omission of which would make any statements in respect of themselves or the Target Group Companies in the Circular or contained in any written document or written or oral communication made to the Approving Parties misleading The Parties respectively undertake to comply with any and all requirements that may be imposed by the SGX-ST or any applicable regulatory body, or take such steps as may be

8 required under the Listing Manual and the Code of Corporate Governance, for the purposes of completing the transactions set out herein The Parties acknowledge that the completion of the proposed sale and purchase of the Sale Shares and the Secured Loan Notes under the S&P Agreement amounts to a reverse take-over offer under the Listing Manual. The Parties undertake to do all such acts and things within their respective powers as may be required to comply with all requirements and procedures necessary to satisfy the listing criteria under the Listing Manual for a listing on the main board of the SGX. 4. RATIONALE FOR THE PROPOSED ACQUISITIONS 4.1 Rationale Trading in the Shares on the SGX-ST has been suspended since 12 December In addition, the Company has been placed under judicial management since 15 September If the Company is liquidated, it is likely that the return to the shareholders and the creditors of the Company will be negligible, if any. The potential return from the successful completion of the transactions as contemplated under the S&P Agreement will potentially give rise to better returns to the shareholders and the creditors of the Company. 5. VERY SUBSTANTIAL ACQUISITION OR REVERSE TAKEOVER 5.1 Chapter 10 of SGX-ST Listing Manual For purposes of Chapter 10 of the Listing Manual, the relative figures for the Proposed Acquisitions using the applicable bases of comparison set out in Rule 1006 of the Listing Manual are as follows:- (a) (b) (c) (d) Net asset value of the assets to be disposed of, compared with the Group s net asset value Net profits attributable to the assets acquired or disposed of, compared with the Group s net profits Aggregate value of the consideration given or received, compared with the Company's market capitalisation Number of equity securities issued by the Company as consideration for an acquisition, compared with the number of equity securities previously in issue : Not applicable to an acquisition of assets : Not meaningful (1) : 2929% (2) : Unable to provide as share consolidation amount has not been fixed Notes : (1) The ratio is not meaningful as the last audited financial statement is for the Company is for the year ending 31 December 2008 which presented that the Company incurred a loss of RMB142.2 million.the Company did not issue financial statement for the year ending 31 December (2) Assuming that the Placement is conducted at the Agreed Valuation, the Purchase Consideration is as set out at Paragraph above. The last transacted Share price of the Company immediately prior to the trading suspension referred to above at Paragraph was S$0.01. Based on the last transacted Share price and the existing number of issued Shares (being 304,320,000), the market capitalization of the Company is approximately S$3.043million.

9 5.1.2 On the basis that the Placement is conducted at the Agreed Valuation, the Vendors will hold approximately % of the post-completion enlarged issued share capital of the Company. Accordingly, a change of control will arise immediately upon Completion Based on the considerations set out above, the Acquisition is considered to be a Very Substantial Acquisition or Reverse Takeover as defined under Chapter 10 of the Listing Manual. 6. FINANCIAL EFFECTS OF THE PROPOSED ACQUISITIONS 6.1 No Meaningful Basis As the Company does not have audited accounts for FY2009 and the last audited accounts of the Company was for FY2008, it will not be meaningful to make any comparisons Further details relating to the financial effects of the Proposed Acquisitions and the transactions contemplated under the S&P Agreement will be set out in a Circular to be dispatched to the shareholders of the Company in relation to the transactions contemplated under the S&P Agreement. 6.2 Shareholding The post-completion share capital of the Company shall be as follows: As per financial year 2008 audited accounts (RMB 000) Post-Completion (RMB 000) Issued and paid up share capital: 142, ,000 (1) Note : (1) On the assumption that the Proposed Share Acquisition, the Proposed LN Acquisition and the Placement at Agreed Valuation are completed. 7. WHITEWASH WAIVER 7.1 Application to the SIC The Vendors and/or their concert parties may be obliged to make a mandatory general offer for the remaining Shares of the Company not owned or controlled by them (and their concert parties pursuant to Rule 14 of the Takeover Code) if, following from the acquisition by either of them and/or their concert parties of the Consideration Shares, to be issued pursuant to the transactions contemplated under the S&P Agreement, their shareholdings and the shareholdings of their concert parties amount to 30% or more of the enlarged share capital of the Company after Completion The Company will be making application to the SIC for a waiver from the requirement for the Vendors and/or their concert parties to make a general offer under Rule 14 of the Takeover Code for all the remaining Shares in issue not already owned, controlled or agreed to be acquired by them and/or their concert parties, subject to the tabling by the Company to its Shareholders of a resolution for the waiver of the rights of independent shareholders of the Company to receive a general offer from the Vendors and/or their

10 concert parties for Shares in the Company under Rule 14 of the Takeover Code following the acquisition by them and/or their concert parties of Consideration Shares. 8. DISCLOSURES OF INTERESTS 8.1 No Interest To the best of the knowledge of the Judicial Managers, no director or substantial shareholder the Company has any interest in the transactions contemplated under the S&P Agreement. 9. DOCUMENTS AVAILABLE FOR INSPECTION 9.1 Venue A copy of the S&P Agreement is available for inspection during normal business hours at the Company s registered office presently at c/o PricewaterhouseCoopers, 8 Cross Street #17-00, PWC Building, Singapore , for a period of three (3) months from the date of this Announcement. 10. CIRCULAR TO SHAREHOLDERS 10.1 Despatch of Circular The Circular, together with notice of the extraordinary general meeting to be held for the purposes of approving the Proposed Acquisitions and the transactions contemplated under the S&P Agreement will be despatched to the shareholders in due course. The Circular will contain, inter alia, details of the Proposed Acquisitions and the other transactions contemplated under the S&P Agreement. CAUTIONARY NOTES 1. The Proposed Acquisitions and other transactions contemplated in the S&P Agreement are subject to certain conditions including but not limited to approval from the courts, the SGX-ST and the creditors and shareholders of the Company. There is no certainty or assurance as at the date of this Announcement that the Proposed Acquisitions and/or the other transactions contemplated in the S&P Agreement will be completed or that no changes will be made to the terms thereof. 2. The information about the Target Group and the Vendors is based on the information provided by the Target and the Vendors to the Judicial Managers and has not been independently verified by the Judicial Managers. BY THE JUDICIAL MANAGERS 4 May 2010

11 APPENDIX 1 VENDORS S/No Name of Vendor Number of Sale Shares held by Vendor and to be sold to the Purchaser 1. ADD HOLDING CO., LTD ** 40, LIU YINGXUAN 4, LIU YUN FEI 1, LIU JIANYING DENG XIANG LONG XIE RONGBIN AGILE PARTNERS LTD WANG QI SONG ZHENHUA YEUNG MAN SIMON SONG BAO GUO 1,180 ** Add Holding Co., Ltd is an investment holding company majority owned by Mr Liu Zi Yu.

12 APPENDIX 2 LN HOLDERS S/No Name of LN Holder Amount of Secured Loan Notes held by each LN Holder (in principal money only) 1. PRIMEPARTNERS ASIA MERCHANT CAPITAL HOLDINGS LIMITED US$4,500, VALCOM HOLDINGS INC. US$4,000, TAN CHIN YONG US$500, OAHU MANAGEMENT PTY LTD (as trustee of the OAHU PROPERTY TRUST) US$500, CHIA SIONG LIM US$500, PHILLIP VENTURES ENTERPRISE FUND 2 LTD US$3,000, JAPAN ASIA INVESTMENT CO., LTD US$1,600, JAIC-CROSBY GREATER CHINA INVESTMENT FUND LIMITED US$650, AVENTURES 1 PTE LTD US$300, LIRUN INVESTMENTS PTE. LTD. US$200, DRAGON GOLD GROUP LIMITED US$750,000