On 5th January, 2000, Righteous and the Subscriber entered into the Subscription Agreement pursuant to which Righteous agreed to issue and the Subscriber agreed to subscribe for the Subscription Shares at a price of HK$0.10 per Subscription Share. On 5th January, 2000, Righteous and Magnum entered into the Placing Agreement pursuant to which Righteous agreed to appoint Magnum to place, or procure the placing of, the Placing Shares at a price of HK$0.10 per Placing Share to independent third parties not connected with Righteous, its directors, substantial shareholders or chief executive or an associate of any of them. Immediately after completion of the Subscription and the Placing, Silver Grant will indirectly hold a total of 1,100,000,000 Shares representing approximately 51.07% of the entire issued share capital of Righteous as enlarged by the Subscription Shares and approximately 44.82% of the entire issued share capital of Righteous as enlarged by the Subscription Shares and the Placing Shares. Application will be made to the Executive for the Whitewash Waiver pursuant to Note 1 of the Notes on Dispensation from Rule 26 of the Code. The Subscription Agreement, the Placing Agreement and the Whitewash Waiver will be subject to the approval of the shareholders of Righteous. A circular containing further information of the Subscription and the Placing will be sent to the shareholders of Righteous. The estimated net proceeds from the Subscription and the Placing will be about HK$110 million and about HK$28 million respectively. Approximately HK$23 million of such net proceeds will be used to repay a shareholder's loan to Righteous and approximately HK$40 million to strengthen its existing business with a further approximately HK$30 million to expand its presence in the PRC and the balance will be used as general working capital of Righteous.

SUBSCRIPTION AGREEMENT DATED 5TH JANUARY, 2000

Subscriber

Fantasy Resources Limited, a wholly-owned subsidiary of Silver Grant

Number of Subscription Shares

1,100,000,000 new Shares representing 104% of the existing entire issued share capital of Righteous and approximately 51.07% of the entire issued share capital of Righteous as enlarged by the Subscription Shares and approximately 44.82% of the entire issued share capital of Righteous as enlarged by the Subscription Shares and the Placing Shares.

Subscription Price

The subscription price of HK$0.10 per Subscription Share represents a discount of about 77.78% to the closing price of HK$0.45 per Share as quoted on the Stock Exchange on 3rd January, 2000 (prior to the suspension of trading of the Shares with effect from 2:30 p.m. on 3rd January, 2000); and a discount of about 54.5% to the average closing prices of about HK$0.22 per Share as quoted on the Stock Exchange for the last 10 trading days up to 3rd January, 2000; and a discount of about 50% to the average closing prices of about HK$0.20 per Share as quoted on the Stock Exchange for the last 30 trading days up to 3rd January, 2000.

Funding for Silver Grant

Silver Grant will fund the subscription price of HK$0.10 per Subscription Share by the Subscriber from internal resources. Somerley Limited, the financial adviser to Silver Grant in connection with the Whitewash Waiver, is satisfied that the Subscriber has sufficient financial resources to complete the Subscription Agreement. Silver Grant has obtained a bank guarantee that, in the event that Silver Grant shall fail to deliver payment for the subscription monies for the Subscription Shares, such bank will provide the necessary financing to Silver Grant for the purpose of completing the Subscription Agreement at terms to be agreed with the bank. Further announcement will be made by Silver Grant regarding details of such financing arrangement where appropriate.

Ranking

The Subscription Shares shall rank pari passu in all respects with the Shares in issue as at the date of the Subscription Agreement including all dividends and distribution declared, paid or made by the Company on or after the date of the Subscription Agreement.

Conditions of the Subscription

Completion of the Subscription is conditional upon:

(a) the Listing Committee of the Stock Exchange granting listing of and permission to deal in the Subscription Shares;

(b) the passing of ordinary resolution(s) by the independent shareholders of Righteous to approve the terms of the Subscription Agreement and authorising the allotment and issue of the Subscription Shares and the Whitewash Waiver;

(c) there being no breach of any representations, warranties, undertakings and obligations under the Subscription Agreement on the part of Righteous;

(d) the Executive granting the Whitewash Waiver and the independent shareholders of Righteous approving the subscription of the Subscription Shares by the Subscriber without the Subscriber and parties acting in concert with it having to make a mandatory offer; and

(e) (if required) the Bermuda Monetary Authority approving the issue of the Subscription Shares pursuant to the Subscription Agreement.

Whitewash Waiver

Silver Grant's indirect shareholding in Righteous immediately after completion of the Subscription and after completion of the Subscription and the Placing will be approximately 51.07% and 44.82% respectively and consequently would be required to make a mandatory offer pursuant to Rule 26 of the Code.

The Whitewash Waiver, if granted by the Executive, would be subject to the approval of the independent shareholders of Righteous by poll at a special general meeting of Righteous. Authorisation by way of a separate vote by the independent shareholder of Righteous will also be sought, for the purposes of Rule 26.1 of the Code, so that the Subscriber and parties acting in concert with it will not be precluded from acquiring additional shares in the 12 months following completion of the Subscription pursuant to Note 15 to Rule 26.1. Silver Grant has confirmed that Silver Grant and parties acting in concert with it have not acquired voting rights in Righteous in the six months prior to the date of this announcement.

Completion of the Subscription

In the event that the conditions are not fulfilled on or before 29th February, 2000 (or such later date as may be agreed between the parties), the Subscription Agreement shall terminate and no party to the Subscription Agreement shall have any liability to any other party, save in respect of any prior breaches.

Completion of the Subscription is expected to take place within three business days after the date on which the above conditions to the Subscription Agreement are fulfilled (or such other date as the parties to the Subscription Agreement may agree).

PLACING AGREEMENT DATED 5TH JANUARY, 2000

Parties

Company:         Righteous

Placing Agent:     Magnum

Placing

Pursuant to the Placing Agreement, Righteous agreed to appoint Magnum to place, or procure the placing of, the Placing Shares on a fully underwritten basis to independent third parties not connected with Righteous, its directors, substantial shareholders or chief executive or an associate of any of them. It is expected that the number of placees will exceed 6.

Number of Placing Shares

300,000,000 new Shares representing approximately 28.46% of the existing entire issued share capital of Righteous and approximately 12.22% of the entire issued share capital of Righteous as enlarged by the Subscription Shares and the Placing Shares.

Placing Price

The placing price of HK$0.10 per Placing Share

Conditions of the Placing

Completion of the Placing is conditional upon:

(a) approval by shareholders of Righteous in general meeting of the issue of the Placing Shares;

(b) the Stock Exchange granting listing of and permission to deal in the Placing Shares;

(c) the Bermuda Monetary Authority granting its consent to the allotment and issue of the Placing Shares, if required; and

(d) completion of the Subscription Agreement.

The Placing Agreement contains provision which allows Magnum to terminate the Placing upon the occurrence of certain events, including force majeure or a breach of any material warranties, representations and undertakings by Righteous under the Placing Agreement.

Completion of the Placing

In the event that the conditions are not fulfilled on or before 3rd March, 2000 (or such later date as may be agreed between the parties), the Placing Agreement shall terminate and no party to the Placing Agreement shall have claim against the other for damages, compensation or otherwise (save in respect of reimbursement to Magnum of reasonable cost incurred in respect of the Placing and in respect of any antecedent breach).

Completion of the Placing is expected to take place on the third business day following the satisfaction or waiver, as the case may be, of the above conditions under the Placing Agreement (or such other date as the parties to the Placing Agreement may agree).

SHAREHOLDING STRUCTURES OF RIGHTEOUS

The following are Righteous' existing shareholding structure, shareholding structure immediately upon completion of the Subscription but before completion of the Placing and shareholding structure immediately upon completion of the Subscription and Placing:--

Existing Structure

Structure immediately upon completion of the Subscription but before Placing

Structure immediately upon completion of the Subscription and Placing

Note: After completion of the Subscription, Project China, the Subscriber and the parties acting in concert with them respectively will be presumed to be acting in concert under the Code unless the contrary is established. However, for the purposes of this announcement, any reference to "Project China and parties acting in concert with it" does not include the Subscriber and parties acting in concert with it and vice versa.

Prior to the signing of the Subscription Agreement, Project China, a company beneficially and wholly-owned by Mr. Chen Guoping, the chairman of Righteous, together with parties acting in concert with it are beneficially interested in 652,094,025 Shares, representing approximately 61.86 per cent. of the issued share capital of Righteous. Upon completion of the Subscription and the Placing, the shareholding of Project China and parties acting in concert with it in Righteous will be reduced to approximately 26.57 per cent. Project China has confirmed that Project China and parties acting in concert with it have not acquired voting rights in Righteous in the six months prior to the date of this announcement.

On 24th December, 1999, Righteous announced that one of its wholly-owned subsidiaries ("Purchaser") has entered into a sale and purchase agreement with certain independent third parties whereby the Purchaser has agreed to purchase 35% interests in the share capital of Shenzhen Yuanheng Liquid Crystal Display Industry Development Co., Limited for a consideration of HK$7,000,000 to be payable by way of HK$2,000,000 in cash and the issue of a convertible note ("Convertible Note") by Righteous in the principal amount of HK$5,000,000. Upon full conversion of the Convertible Note at an initial conversion price of HK$0.15 per Share, a total of 33,333,333 Shares will be issued. Assuming such full conversion of the Convertible Note, the shareholding in Righteous held by Project China and parties acting in concert with it, the Subscriber and the public immediately upon completion of the Subscription and Placing will be 26.21 per cent., 44.22 per cent. and 29.57 per cent. respectively.

REASONS FOR THE SUBSCRIPTION AND INTENTION OF SILVER GRANT

Righteous is principally an investment holding company having investments in the business of retailing and wholesale of leather goods, the operation of department store, property investment and other investments. Silver Grant is principally engaged in property, PRC retailing and other investments.

Given that the retailing businesses of Righteous and Silver Grant are either different in nature or situate at different cities in the PRC and that the remaining principal businesses of Righteous and Silver Grant do not compete with each other, it is not anticipated that the respective existing businesses of Righteous and Silver Grant will have any direct competition with each other.

Immediately after completion of the Subscription Agreement and the Placing, Silver Grant will indirectly hold approximately 44.82% in the entire issued share capital of Righteous as enlarged by the Subscription Shares and the Placing Shares and will become the controlling shareholder of Righteous.

The Subscriber is independent of and not connected with the directors, chief executives or substantial shareholders of Righteous or any of its subsidiaries or any of their respective associates (as defined in the Listing Rules). It is expected that, in addition to the existing 8 members of the board of directors of Righteous, Silver Grant will appoint up to three executive directors to the board of directors of Righteous after completion. Should the businesses of Righteous require, Silver Grant may appoint further directors to the board of directors of Righteous.

At present, the tightness of Righteous' liquidity is restricting its ability to inject sufficient funds into its business so as to enable such businesses to perform in an efficient manner. The directors of Righteous consider that the net proceeds from the Subscription and Placing of approximately HK$138 million will increase the working capital and improve the existing liquidity of Righteous and in addition allow Righteous to consider other investment opportunities and to diversify its investment portfolio. Approximately HK$23 million of such net proceeds from the Subscription and Placing will be used to repay a shareholder's loan to Righteous and approximately HK$40 million to strengthen its existing business with a further approximately HK$30 million to expand its presence in the PRC and the balance of such net proceeds will be used for general working capital of Righteous. The directors of Silver Grant consider that the Subscription provides good investment opportunities having regard to the acquisition of such controlling interest in Righteous.

The unsecured shareholder's loan of HK$23 million was provided by Project China pursuant to a loan agreement dated 24th March, 1999. Under the loan agreement, Righteous is obliged to pay interest on the outstanding loan amount at the prime rate plus 1% payable on a quarterly basis and such loan is for a maximum period of three years from the first date of drawdown.

The terms of and consideration payable under the Subscription Agreement has been arrived at after arm's length negotiation and are based on normal commercial terms. The directors of Righteous and the directors of Silver Grant consider the terms of the Subscription Agreement to be fair and reasonable and to be in the interests of Righteous and Silver Grant.

Silver Grant intends to hold the interest in the Subscription Shares as a long-term investment. At present, Silver Grant has no plan to inject any material assets into Righteous. As soon as the appointment of the new directors nominated by Silver Grant to the board of directors of Righteous takes effect, Silver Grant will endeavour to improve the long-term profitability and productivity of those loss-making businesses of Righteous. If this cannot be achieved, Silver Grant may recommend to the board of directors of Righteous proposals for cessation or disposal of such businesses. In addition, Silver Grant will explore other business opportunities of Righteous to strengthen and broaden its revenue stream. However, any future investments in, or disposal of, businesses that may be conducted by Righteous will be subject to compliance with all applicable regulatory requirements and/or shareholders approval of Righteous if so required by the Listing Rules or other applicable laws and relevant regulations.

Upon completion of the Subscription Agreement and the Placing Agreement, Righteous will become an associated company of Silver Grant. It is not intended for Righteous to become a subsidiary of Silver Grant.

SPECIAL GENERAL MEETING

A special general meeting of the shareholders of Righteous will be convened to seek the approvals necessary for the Subscription, the Placing and the Whitewash Waiver. Project China and parties acting in concert with it will abstain from voting on the resolution to approve the Whitewash Waiver.

GENERAL

Righteous will apply to the Stock Exchange for listing of and permission to deal in the Subscription Shares and the Placing Shares. The Subscriber will apply to the Securities and Futures Commission for the Whitewash Waiver.

An Independent Board Committee will be formed to consider and advise the independent shareholders of Righteous in respect of the Subscription Agreement and the Whitewash Waiver and an independent financial adviser will be appointed to advise the Independent Board Committee on whether or not the terms of the Subscription Agreement and also the granting of the Whitewash Waiver are in the interests of Righteous and are fair and reasonable so far as the independent shareholders of Righteous are concerned.

A circular containing further information of the Subscription, the Placing, the Whitewash Waiver, a letter from the Independent Board Committee, a letter from the independent financial adviser to the Independent Board Committee and the notice of the special general meeting of Righteous will be sent to shareholders of Righteous as soon as practicable.

At the request of Righteous and Silver Grant, trading in the shares of Righteous and Silver Grant respectively on the Stock Exchange were suspended with effect from 2:30 p.m. on 3rd January, 2000. Application has been made by Righteous and Silver Grant to resume their respective trading of shares with effect from 10:00 a.m. on 10th January, 2000.

As both the Subscription Agreement and the Placing Agreement are subject to conditions, they may or may not proceed accordingly. In the event that the Subscription Agreement is completed but the Placing Agreement does not proceed, the minimum 25% public holding of Shares will not be maintained. Therefore, shareholders of Righteous and Silver Grant are advised to exercise caution in dealing with the respective shares of these companies. The Stock Exchange has stated that, in the event that less than 25% of the issued Shares are in public hands following the completion of the Subscription only (and not the Placing), it will closely monitor trading in the Shares. If the Stock Exchange believes that a false market exists or may exist in the Shares or that there are insufficient Shares in public hands to maintain an orderly market, it will give consideration to exercising its discretion to suspend dealings in the Shares.

DEFINITIONS

"Code"	means the Hong Kong Code on Takeovers and Mergers;
"Executive"	means the Executive Director of the Corporate Finance Division of the Securities and Futures Commission or any delegate of the Executive Director;
"Group"	means Righteous and its subsidiaries;
"Hong Kong"	means the Hong Kong Special Administrative Region of the People's Republic of China;
"Independent Board Committee"	means an independent committee of the board of directors of Righteous;
"Listing Rules"	means the Rules Governing the Listing of Securities on the Stock Exchange;
"Magnum"	means Magnum International Securities Limited, a registered dealer under the Securities Ordinance (Chapter 333 of the Laws of Hong Kong);
"Placing"	means the placing or procurement of placing of the Placing Shares by Magnum pursuant to the Placing Agreement;
"Placing Agreement"	means the placing and underwriting agreement dated 5th January, 2000 between Righteous and Magnum;
"Placing Shares"	means 300,000,000 new Shares;
"Project China"	means Project China Holdings Limited, a limited company incorporated in the British Virgin Islands and ultimately owned by Mr. Chen Guoping, the chairman of Righteous;
"Righteous"	means Righteous (Holdings) Limited, a limited company incorporated in Bermuda, the Shares of which are listed on the Stock Exchange;
"Shares"	means shares of HK$0.10 each in the share capital of Righteous and a "Share" shall be construed accordingly;
"Silver Grant"	means Silver Grant International Industries Limited, a limited company incorporated in Hong Kong, the shares of which are listed on the Stock Exchange;
"Stock Exchange"	means The Stock Exchange of Hong Kong Limited;
"Subscriber"	means Fantasy Resources Limited, a wholly-owned subsidiary of Silver Grant and a limited company incorporated in the British Virgin Islands;
"Subscription"	means the subscription by the Subscriber of 1,100,000,000 new Shares;
"Subscription Agreement"	means the agreement dated 5th January, 2000 between Righteous and Silver Grant in relation to the Subscription;
"Subscription Shares"	means 1,100,000,000 new Shares; and
"Whitewash Waiver"	means the waiver pursuant to Note 1 of the Notes on Dispensation from Rule 26 of the Code waiving any obligation on the part of the Subscriber and parties acting in concert with it to make a general offer as a result of the Subscription.

By Order of the Board Righteous (Holdings) Limited Chen Guoping Chairman

By Order of the Board Silver Grant International Industries Limited Gao Jian Min Managing Director

Hong Kong, 8th January, 2000

The directors of Righteous jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than information relating to Silver Grant and/or its subsidiaries), and confirm, having made reasonable enquiries that, to the best of their knowledge, the opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The directors of Silver Grant jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than information relating to Righteous and/or its subsidiaries), and confirm, having made reasonable enquiries that, to the best of their knowledge, the opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

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