Major Shareholder:

• Yeung Chung Lung ¡V 48.75% interest
• Lin Wan Qaing ¡V 15.75% interest
• Tung Fai ¡V 10.5% interest

Company Subsidiaries:

• Longyu (100%): Manufacture of frozen marine foods, functional foods and processed meat products

The Group is a processor of frozen natural foods that focuses on addressing the nutrition, health and wellness needs of consumers in the PRC and international markets including the U.S. and Japan. As a participant of the nutritional food industry, the Group concentrates on the functional food and the natural food segments whilst emphasising that all of its products are natural and healthy. The Group processes a broad array of agricultural and marine food products. It principally operates in three product divisions: frozen marine food division, frozen functional food division and refrigerated meat division.

The Group's products are mainly sold , through four state-owned import/export companies (independent third parties to the Group who handle related export procedures) to international food importers in the U.S. and Japan. Most of the Group's exported marine food products and functional food products are packaged under its customers' brand names. The Group also distributes a number of its products in the PRC, the U.S. and Japan under its LONGYU brand.

The Group owns and operates its food processing activities at its food processing plant in Fuqing with an annual production capacity of approximately 4,000 tons of frozen marine food products, 3,000 tons of frozen functional food products and 1,000 tons of refrigerated meat products.

The Directors believe that the Group has competitive advantages over its competitors in the PRC and overseas for the following principal reasons:

• The Group's production bases are situated in Fuqing with favourable climatic conditions throughout the year and enjoy fertile and non-polluted soil and water supply. The Group also enjoys an abundant supply of raw materials for marine food products, processed meat products, and functional food products from the region near its production base.

• Fujian province was ranked by Statistic Bureau of the PRC as the second largest fishery port in the PRC in 1999. Being one of the largest marine food processors in Fujian province, the Group has access to a reliable supply of low cost and high quality aquaculture and agriculture materials.

• The Group emphasised on and has earned a reputation for customer-driven research and development in designing new products and implementing advanced processing technology.

• Experienced leadership. Mr. Yeung, the chairman of the Group, has more than 18 years of experience in the agriculture and aquaculture industry of the PRC and Japan.

• Safety of food products
• Fluctuation in raw material prices and selling prices of products
• Dependence on key management personnel
• Dependence on supply of raw materials
• Dependence on packaging suppliers
• Dependence on eel products
• Value-added tax refund in the PRC
• Reliance on the demands from Japan and the U.S.
• Competition
• Import suspension on Chinese poultry
• Effects of WTO accession

With the rise in income and consumption of the PRC families in major cities, eating habits have changed to focus on foods that address health and wellness needs. The Group intends to invest significant resources in its sales and distribution network and research and development to improve its penetration of the domestic market.

The Group plans to:

• Increase the distribution of its products to large national retail food stores and restaurants in the PRC.

• Build and emphasise brand awareness and capitalise on consumers' preferences in the PRC for brandname products and the Group's insistence on product freshness and quality.

• Emphasise on high profit margin products such as the pre-cooked, frozen shellfish products in the Group's marine food products division.

• Commence production of frozen organic vegetable and fruit products by late 2002.

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The net proceeds from the Placing, after deducting the related expenses, are estimated to amount to approximately HK$130 million. The Group at present intends to apply the net proceeds as follows: