IMPLICATIONS UNDER THE LISTING RULES As at the date of this announcement, Shougang Concord International is controlled as to an aggregate of approximately 46.06% by Shougang Group through its subsidiaries, and Shougang Group is a substantial Shareholder indirectly holding an aggregate of approximately 27.46% of the total number of Shares in issue through its subsidiaries Shougang Hong Kong, Lord Fortune and Plus All. As such, Shougang Concord International and SCIT, being an indirect wholly owned subsidiary of Shougang Concord International, are each an associate of Shougang Group and a connected person of the Company under the Listing Rules, and the transaction contemplated under the Assignment and Novation Agreement constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As one or more of the applicable percentage ratios (as defined in Chapter 14A of the Listing Rules) exceed(s) 5% and the Consideration exceeds HK$10 million, the connected transaction contemplated under the Assignment and Novation Agreement is subject to the announcement, circular, Independent Shareholders’ approval and reporting requirements under Chapter 14A of the Listing Rules. In view of the foregoing, the Company will seek to obtain the approval of the Independent Shareholders in respect of the connected transaction contemplated under the Assignment and Novation Agreement at the EGM. In accordance with the Listing Rules, the voting at the EGM will be taken by poll. Shougang Group, Shougang Hong Kong, Xxxx Xxxxxxx, Plus All, VMSIG, Fast Fortune, and their respective associates, and all other Shareholders with a material interest in the connected transaction contemplated under the Assignment and Novation Agreement are required to abstain from voting on the respective resolutions proposed to be passed at the EGM for approving the Assignment and Novation Agreement and the connected transaction contemplated thereunder. The Company has established the Independent Board Committee comprising all the three independent non- executive Directors to advise the Independent Shareholders as to whether the terms and conditions of the Assignment and Novation Agreement are fair and reasonable, whether the connected transaction contemplated under the Assignment and Novation Agreement is on normal commercial terms, in the ordinary and usual course of business of the Group and in the interests of the Company and the Shareholders as a whole, and how to vote at the EGM in respect of the connected transaction contemplated under the Assignment and Novation Agreement, after taking into account the recommendations of the IFA. The Company has appointed Halcyon Capital Limited as the IFA to advise the Independent Board Committee and the Independent Shareholders as to the foregoing matters.