Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

I.ODICIDG LONKING HOLDINGS LIMITED Jft lllli mtfim*itJ*

(lncorporated in the Cayman Islands with limited liability)

(Stock code: 3339)

RENEWAL OF

CONTINUING CONNECTED TRANSACTIONS WITH SHANGHAI REFINED MACHINERY CO. LTD.

References are made to the announcements of the Company dated 31 December 2012 and 6 May

2013 in relation to the continuing connected transactions contemplated under the Existing Master

Purchase Agreements.

As the Existing Master Purchase Agreements will expire on 31 December 2013, the Company and Shanghai Refined Machinery on 31 December 2013 entered into the Renewed Master Purchase Agreement to renew the terms of the Existing Master Purchase Agreements for a period of one year commencing from l January 2014 and ending on 31 December 2014.

As at the date of this announcement, as Shanghai Refined Machinery is a company wholly-owned by Refined Holdings, which is in turn wholly owned by Mr. Li Bin, the son of Mr. Li San Yim, an executive Director, the chairman and the controlling shareholder of the Company, it is an associate of Mr. Li San Yim. Thus, Shanghai Refined Machinery is a connected person of the Company under the Listing Rules.

As each of the applicable percentage ratios (other than the profits ratio) in respect of the continuing connected transactions contemplated under the Renewed Master Purchase Agreement is on an annual basis expected to be more than 0.1% but less than 5%, such transactions constitute continuing connected transactions under Rule 14A.34 of the Listing Rules and are thus subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47 of the Listing Rules, the annual review requirements set out in Rules 14A.37 to 14A.40 of the Listing Rules and the requirements set out in Rules 14A.35(1) and 14A.35(2) of the Listing Rules, but are exempt from the independent shareholders' approvai requirements under Chapter 14A of the Listing Rules.

* Far identification purposes only

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References are made to the announcements of the Company dated 31 December 2012 and 6 May
2013 (the "Announcements") in relation to the continuing connected transactions contemplated under the Existing Master Purchase Agreements. Capitalized terms used in this announcement shall have the same meanings as those defined in the Announcements unless the context otherwise requires.

BACKGROUND

On 31 December 2012 and 6 May 2013, the Company and Shanghai Refined Machinery entered into the Existing Shanghai Refined Machinery Master Purchase Agreement and the Purchase Agreement, pursuant to which the Group agreed to purchase the Landscraper Products and the Rotary Drilling Products from Shanghai Refined Machinery from time to time for a term commencing from 1 January
2013 to 31 December 2013 and from 6 May 2013 to 31 December 2013, respectively. The Existing Master Purchase Agreements will expire on 31 December 2013. RENEWAL OF THE EXISTING MASTER PURCHASE AGREEMENTS

The Renewed Master Purchase Agreement

Date : 31 December 2013
Parties : (1) the Company, as purchaser
(2) Shanghai Refined Machinery, as the supplier
Subject : Pursuant to the Renewed Master Purchase Agreement, the Company will purchase the Products from Shanghai Refined Machinery from time to time during the term of the Renewed Master Purchase Agreement.
Term : The Renewed Master Purchase Agreement will take effect from 1 January 2014 and expire on 31 December 2014.
Price : The purchase price of the Products shall not be (i) higher than the price at which the Company or its subsidiaries would otherwise purchase from its independent supplies which supply the Products of the same type and quality, and (ii) higher than the price at which Shanghai Refined Machinery would otherwise supply to its independent customers which purchase the Products of the same type and quality.

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Payment terms : The purchase price of the Products shall be settled in full based on the Contractual Amount within 30 business days after shipping of the Products to overseas customers by the Company.

Historical transaction records

For the year ended 31 December 2012 and the eleven months ended 30 November 2013, the aggregate purchase amount (including value added tax) by the Group from Shanghai Refined Machinery for the purchase of the Landscraper Products amounted to approximately RMB10 million (equivalent to approximately HK$13 million) and RMB6 million (equivalent to approximately HK$7.6 million), respectively. For the period from 6 May 2013 to 30 November 2013, the aggregate purchase amount (including value added tax) by the Group from Shanghai Refined Machinery for the purchase of the Rotary Drilling Products amounted to approximately RMB3.5 million (equivalent to approximately HK$4.5 million).

Annual caps

The Directors estimate that the aggregate purchase amount of the Landscraper Products and the Rotary Drilling Products to be paid by the Group to Shanghai Refined Machinery pursuant to the transactions under the Renewed Master Purchase Agreement for the financial year ending 31
December 2014 will not exceed RMB25 million (including value added tax) (equivalent to approximately HK$32 million) and RMB19 million (including value added tax) (equivalent to approximately HK$24 million), respectively. The annual caps were determined by the Company with reference to the actual amount of Products purchased for the year ended 31 December 2012 and the eleven months ended 30 November 2013 and the anticipated demand of the Products by the Company for the year ending 31 December 2014.

REASONS FOR AND BENEFITS OF ENTERING INTO THE RENEWED MASTER PURCHASE AGREEMENT

The Company was originally a manufacturer of the Landscraper Products. However, as the sale volume of the Products had been relatively small compared to the overall revenue of the Company as a whole, the Company discontinued the manufacture of the Landscraper Products in April 2010 and focused on manufacturing its four core products, namely, wheel loaders, excavators, fork lifts and road rollers. Instead of manufacturing the Products, the Company has since then started reselling the Products to overseas customers in response to the demand of its overseas clients.
The Company has also been reselling the Rotary Drilling Products to overseas customers in response to the demand of its overseas clients. Instead of manufacturing the Rotary Drilling Products, the Company purchased from a third-party supplier of the Rotary Drilling Products and re-sold them to its overseas clients. Since Shanghai Refined Machinery is able to offer the Rotary Drilling Products

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of comparative quality but at a more competitive price, the Company has started purchasing from Shanghai Refined Machinery since 1 January 2013, instead of from other third-party supplies, so as to minimize costs, which would in turn increase the profitability of the Group's business as a whole.

IMPLICATIONS UNDER THE LISTING RULES

As at the date of this announcement, as Shanghai Refined Machinery is a company wholly-owned by Refined Holdings, which is in turn wholly owned by Mr. Li Bin, the son of Mr. Li San Yim, an executive Director, the chairman and the controlling shareholder of the Company, it is an associate of Mr. Li San Yim. Thus, Shanghai Refined Machinery is a connected person of the Company under the Listing Rules.
As each of the applicable percentage ratios (other than the profits ratio) in respect of the continuing connected transactions contemplated under the Renewed Master Purchase Agreement is on an annual basis expected to be more than 0.1 % but less than 5%, such transactions constitute continuing connected transactions under Rule 14A.34 of the Listing Rules and are thus subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47 of the Listing Rules, the annual review requirements set out in Rules 14A.37 to 14A.40 of the Listing Rules and the requirements set out in Rules 14A.35(1) and 14A.35(2) of the Listing Rules, but are exempt from the independent shareholders' approval requirements under Chapter 14A of the Listing Rules.
The Directors (including the independent non-executive Directors) consider that the transactions under the Renewed Master Purchase Agreement are entered into in the usual and ordinary course of business of the Group and the terms of the transactions have been negotiated and will be conducted on an arm's length basis and on normal commercial terms between the Company and Shanghai Refined Machinery. The Directors (including the independent non-executive Directors) are of the view that as far as the Company and the Shareholders are concerned, the transactions under the Renewed Master Purchase Agreement and the terms thereof are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Mr. Li San Yim and Ms. Ngai Ngan Yin, the spouse of Mr. Li San Yim, are considered to have a material interest in the transaction contemplated under the Renewed Master Purchase Agreement, and accordingly each of Mr. Li San Yim and Ms. Ngai Ngan Yin had abstained from voting on the resolutions of the Board approving the same.

GENERAL

The Company is principally engaged in the manufacture of wheel loaders and other infrastructure machinery in the PRC. It also manufactures axles and transmission, which are critical components for wheel loaders.

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Shanghai Refined Machinery is a manufacturer and distributor of engineering machineries and components, including the Products in PRC. It is primarily engaged in development, design and production of engineering machineries, construction machineries, diesel engines and their components, as well as the sale of self-manufactured products and the provision of after-sales services and technical consulting services.

DEFINITIONS

In this announcement, the following expressions shall have the meanings set out below unless the context requires otherwise:
"associate" has the meaning as given to it in the Listing Rules
"Board" the board of Directors
"Company" Lonking Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the main board of the Stock Exchange
"connected person" has the meaning as given to it under the Listing Rules
"controlling shareholder" has the meaning as given to it under the Listing Rules
"Director(s)" the director(s) of the Company
"Existing Master Purchase
Agreements"
comprising the Existing Shanghai Refined Machinery Master
Purchase Agreement and the Purchase Agreement
"Existing Shanghai Refined Machinery Master Purchase Agreement"
the master purchase agreement dated 31 December 2012 entered into between the Company and Shanghai Refined Machinery, pursuant to which the Company agreed to or would procure its subsidiaries to purchase the Landscraper Products from Shanghai Refined Machinery from time to time for the period from 1 January
2013 to 31 December 2013
"Group" the Company and its subsidiaries
"HK$" Hong Kong dollar, the lawful currency of Hong Kong
"Hong Kong" the Hong Kong Special Administrative Region of the People's
Republic of China

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"Landscraper Products" landscraper products mainly used in large-scale land leveling, road construction, road maintenance and a variety of supplemental work
"Listing Rules" the Rules Governing the Listing of Securities on the Stock
Exchange
"PRC" the People's Republic of China, excluding, for the purposes of this announcement, Hong Kong, Taiwan and the Macau Special Administrative Region
"Products" Landscraper Products and Rotary Drilling Products
"Purchase Agreement" the framework purchase agreement dated 6 May 2013 entered into between the Company and Shanghai Refined Machinery, pursuant to which the Company agreed to or would procure its subsidiaries to purchase the Rotary Drilling Products from Shanghai Refined Machinery from time to time for the period from 6 May 2013 to 31
December 2013
"Refined Holdings" Refined Holdings Limited, a company incorporated in Hong Kong, and is wholly owned by Mr. Li Bin
"Renewed Master Purchase
Agreement"
the master purchase agreement dated 31 December 2013 entered into between the Company and Shanghai Refined Machinery in relation to the purchase of the Products by the Company from Shanghai Refined Machinery from time to time for a term
commencing from 1 January 2014 and ending 31 December 2014
"RMB" Renminbi, the lawful currency of the PRC
"Rotary Drilling Products" rotary drilling rigs which are machineries to be used in building foundation projects and may include parts such as dematron machines, drilling buckets, tube drillings and jaws
"Shareholder(s)" shareholder(s) of the Company
"Shanghai Refined
Machinery"