A & S Group (Holdings) Limited — Proxy Solicitation & Information Statement 2011

Jun 9, 2011

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in Le Saunda Holdings Limited, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or other transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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

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(Incorporated in Bermuda with limited liability) (Stock Code : 0738)

PROPOSED GRANT OF GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE SHARES PROPOSED RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of Le Saunda Holdings Limited to be held at Harbour Grand Hong Kong, Salon Rooms VI-VII, 5/F, MTR Fortress Hill Station, Exit A, 23 Oil Street, North Point, Hong Kong on Monday, 18 July 2011 at 10:30 a.m. (or any adjournment thereof) is set out on pages 16 to 20 of this circular. Whether or not you intend to attend the meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time for holding the meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting at the annual general meeting or any adjourned meeting should you so wish.

* For identification purposes only

Hong Kong, 10 June 2011

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Proposed Grant of General Mandates to issue Shares and Repurchase its Own Shares . . .	4
Proposed Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Appendix — Explanatory Statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
Notice of Annual General Meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

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DEFINITIONS

In this circular, the following expressions have the following meanings unless the context requires otherwise:

• “Annual General Meeting” annual general meeting of the Company to be held at 10:30 a.m. on Monday, 18 July 2011 (or any adjournment thereof), the notice of which is set out on pages 16 to 20 of this circular

• “associates” has the same meaning as defined in the Listing Rules “Board” board of Directors (or a duly authorised committee thereof) “Bye-laws” bye-laws of the Company as amended from time to time “Companies Act” Companies Act 1981 of Bermuda

annual general meeting of the Company to be held at 10:30 a.m. on Monday, 18 July 2011 (or any adjournment thereof), the notice of which is set out on pages 16 to 20 of this circular

• “Company” Le Saunda Holdings Limited, a company incorporated in Bermuda with limited liability, the securities of which are listed on the main board of the Stock Exchange

• “Director(s)” director(s) of the Company

• “General Mandates” the Share Issue Mandate and the Repurchase Mandate “Group” the Company and its subsidiaries “Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

• “Latest Practicable Date” 2 June 2011, being the latest practicable date prior to the printing of this circular for ascertaining certain information included herein

• “Listing Rules” Rules Governing the Listing of Securities on the Stock Exchange

• “Repurchase Mandate” a general and unconditional mandate proposed to be granted at the Annual General Meeting to the Directors to exercise all the powers of the Company to repurchase Shares up to 10% of the entire issued Shares as at the date of passing of the relevant resolution

• “SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

• “Share(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company

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	DEFINITIONS
“Share Issue Mandate”	a general and unconditional mandate proposed to be granted
	at the Annual General Meeting to the Directors to exercise all
	the powers of the Company to issue, allot and otherwise deal
	with new Shares up to 20% of the entire issued Shares as at
	the date of passing of the relevant resolution
“Share Options”	options granted by the Company pursuant to a share option
	scheme adopted by the Company on 22 July 2002 entitling the
	grantees thereof to subscribe for a specific number of Shares
	within a specific period(s)
“Shareholders”	holders of Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Takeovers Code”	The Code on Takeovers and Mergers
“HK$”	Hong Kong dollars
“%”	per cent.

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LETTER FROM THE BOARD

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(Incorporated in Bermuda with limited liability)

(Stock Code : 0738)

Executive Directors: Mr. Lee Tze Bun, Marces (Chairman) Ms. Lau Shun Wai (Chief Executive Officer) Ms. Wong Sau Han Ms. Chu Tsui Lan

Registered office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Non-executive Director: Mr. James Ngai (appointed on 25 March 2011)

Independent non-executive Directors: Mr. Lam Siu Lun, Simon Mr. Leung Wai Ki, George Mr. Hui Chi Kwan

Principal Place of Business in Hong Kong: 17th Floor 1063 King’s Road Quarry Bay Hong Kong 10 June 2011

To Shareholders

Dear Sir/Madam,

PROPOSED GRANT OF GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE SHARES PROPOSED RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information reasonably necessary to enable you to make a decision on whether to vote for or against the ordinary resolutions to be proposed at the Annual General Meeting which will be convened for the purpose of considering and, if thought fit, approving:

• (a) the grant of the Share Issue Mandate and Repurchase Mandate to the Directors to issue Shares and to repurchase Shares; and

• For identification purposes only

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LETTER FROM THE BOARD

• (b) the re-election of Directors.

The notice of the Annual General Meeting is set out on pages 16 to 20 of this circular.

PROPOSED GRANT OF GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE ITS OWN SHARES

At the last annual general meeting of the Company held on 19 July 2010, the Directors were granted a general mandate to allot and issue Shares and a general mandate to repurchase Shares. These mandates will expire at the conclusion of the Annual General Meeting. The Directors propose to seek the approval of the Shareholders at the Annual General Meeting by way of passing ordinary resolutions for granting:

• the Share Issue Mandate to issue Shares up to a maximum of 20% of the Shares in issue as at the date of passing of the relevant resolution and of approximately 127,862,720 Shares as at the Latest Practicable Date;

• the Repurchase Mandate to repurchase Shares up to a maximum of 10% of the Shares in issue as at the date of passing of the relevant resolution; and

• the Share Issue Mandate be extended to the Shares and other securities that are allowed to be repurchased by the Company pursuant to the Repurchase Mandate.

As required by the Listing Rules, an explanatory statement on the Repurchase Mandate is set out in the Appendix to this circular.

PROPOSED RE-ELECTION OF DIRECTORS

Mr. James Ngai was appointed as non-executive Director with effect from 25 March 2011. According to Bye-law 86(2) of the Company, he will hold office only until the next following annual general meeting of the Company and will then be eligible for re-election at that meeting. Accordingly, at the Annual General Meeting, Mr. James Ngai will retire and, being eligible, offer himself for re-election.

Also, in accordance with Bye-law 87 of the Company, one-third of the Directors for the time being (or, if their number is not a multiple of three, the number nearest to but not less than one-third) shall retire from office by rotation provided that every Director (including those appointed for a specific term) shall retire from office by rotation no later than the third annual general meeting after he was last elected or re-elected. Accordingly, at the Annual General Meeting, Mr. Lee Tze Bun, Marces, Mr. Leung Wai Ki, George and Ms. Chu Tsui Lan will retire and, being eligible, offer themselves for re-election.

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LETTER FROM THE BOARD

Brief biographies of Mr. James Ngai, Mr. Lee Tze Bun, Marces, Mr. Leung Wai Ki, George and Ms. Chu Tsui Lan are as follows:

James Ngai (“Mr. Ngai”) , aged 48, is non-executive Director of the Group. He joined the Group in March 2011. He is a Certified Public Accountant (Practising) in Hong Kong and a member of the Hong Kong Institute of Certified Public Accountants and the American Institute of Certified Public Accountants. He is also a fellow member of the Taxation Institute of Hong Kong. Mr. Ngai graduated from the University of Toronto with a Bachelor Degree in Economics. He has over 20 years of experience in accounting, auditing and taxation matters.

The Company entered into a service agreement with Mr. Ngai for a fixed term of 2 years commencing on 25 March 2011 and ending on 24 March 2013 which may be terminated by either party by giving three-months’ written notice. Pursuant to the service agreement, Mr. Ngai is entitled to receive an annual director’s fee of HK$180,000, which was determined and approved by the Board of the Company according to the prevailing market rate and the Company’s remuneration policy and which is subject to review by the remuneration committee of the Company each year. All additional remuneration (such as bonus) which may be given to Mr. Ngai (if any) shall be determined and approved by the remuneration committee of the Company based on the Company’s remuneration policy. The Company has no intention of giving any such additional remuneration to Mr. Ngai as it has never provided to any non-executive Director any remuneration other than the annual director’s fee.

As at the Latest Practicable Date, within the meaning of Part XV of the SFO, Mr. Ngai does not have, and is not taken or deemed to have, any interests or short positions in any shares, underlying shares of equity derivatives or debentures of the Company and/or its associated corporations.

Mr. Ngai is the director of James Ngai & Partners CPA Limited, which provides advisory and audit services to private companies owned by Mr. Lee Tze Bun, Marces, Chairman of the Board. Save as disclosed above, Mr. Ngai is not connected with any directors, chief executives, substantial shareholders or controlling shareholders or any of their respective associates (all as defined in the Listing Rules) of the Company.

Mr. Ngai does not hold any directorship in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years.

Save as disclosed above, there are no other matters concerning Mr. Ngai that are required to be disclosed pursuant to paragraphs (h) to (v) of Listing Rule 13.51(2), nor any other matters or information that need to be brought to the attention of the Shareholders or required to be disclosed pursuant to any of the requirements of Listing Rule 13.51(2).

Lee Tze Bun, Marces (“Mr. Lee”) , aged 77, is executive Director, the founder and Chairman of the Group. With more than 32 years of experience in the shoes retailing business, Mr. Lee has a strong, established and extensive business relation with a vast range of shoe suppliers in Italy. Mr. Lee is the winner of the “Owner-Operator Award” at the DHL/SCMP Hong Kong Business Awards 2009. He is responsible for the Group’s leadership and management of the Board and the Group’s strategy.

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LETTER FROM THE BOARD

The Company entered into a service agreement with Mr. Lee which does not have any fixed term and may be terminated by either party by giving three-months’ written notice, pursuant to which he is not entitled to any fixed annual salary but is entitled to discretionary bonus (which is to be determined by the remuneration committee of the Company based on Mr. Lee’s performance with reference to the annual results of the Group).

As at the Latest Practicable Date, within the meaning of Part XV of the SFO, Mr. Lee, being a substantial shareholder and controlling shareholder of the Company, has and is deemed to have interests in the Shares of the Company and/or its associated corporations as follows:-

1. Mr. Lee personally holds 36,268,000 Shares.

2. 30,000,000 Shares are held by Succex Limited, which is wholly owned by Mr. Lee. Therefore, Mr. Lee is deemed to be interested in those Shares.

3. 1,384,000 Shares are held by Xin Chuan Middle School Foundation Limited (“Xin Chuan”), of which Mr. Lee is a governor. Therefore, Mr. Lee is deemed to be interested in those Shares.

4. Stable Gain Holdings Limited (“Stable Gain”) holds 205,000,000 Shares, representing approximately 32.07% of the issued share capital of the Company. The entire issued share capital of Stable Gain is registered in the name of First Advisory Trustees Ltd. (formerly known as LGT Trustees Ltd.) as trustee of The Lee Keung Family Trust, a discretionary trust, of which Mr. Lee is the founder and an eligible beneficiary thereunder. Therefore, Mr. Lee is deemed to be interested in those Shares.

5. Mr. Lee beneficially owns 20,000 non-voting deferred shares in L. S. Retailing Limited, a wholly-owned subsidiary of the Company.

Together with the interests of Stable Gain, Succex Limited and Xin Chuan, Mr. Lee is interested in an aggregate of 272,652,000 Shares, being approximately 42.65% of the issued share capital of the Company as at the Latest Practicable Date.

Save as disclosed above, within the meaning of Part XV of the SFO, Mr. Lee does not have, and is not taken or deemed to have, any interests or short positions in any shares, underlying shares of equity derivatives or debentures of the Company and/or its associated corporations.

Save as disclosed above, Mr. Lee is not connected with any directors, chief executives, substantial shareholders (except Ms. Lee Wing Kam Rowena Jackie, being the daughter of Mr. Lee) or controlling shareholders or any of their respective associates (as defined in the Listing Rules) of the Company. Mr. Lee also did not have any directorship held in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years.

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LETTER FROM THE BOARD

Save as disclosed above, there are no other matters concerning Mr. Lee that are required to be disclosed pursuant to paragraphs (h) to (v) of Listing Rule 13.51(2), nor any other matters or information that need to be brought to the attention of the Shareholders or required to be disclosed pursuant to any of the requirements of Listing Rule 13.51(2).

Leung Wai Ki, George (“Mr. Leung”) , aged 52, is independent non-executive Director, of the Group. He joined the Group in September 2004. Mr. Leung has over 23 years of experience in accounting, financial management, auditing and receivership. Mr. Leung is acting as director and financial controller of a real estate development company in Hong Kong.

The Company entered into a service agreement with Mr. Leung for a fixed term of 2 years commencing on 1 November 2009 and ending on 31 October 2011 which may be terminated by either party by giving three-months’ written notice. Pursuant to the service agreement, Mr. Leung is entitled to receive an annual director’s fee of HK$180,000, which was determined and approved by the Board of the Company according to the prevailing market rate and the Company’s remuneration policy and which is subject to review by the remuneration committee of the Company each year. All additional remuneration (such as bonus) which may be given to Mr. Leung (if any) shall be determined and approved by the remuneration committee of the Company based on the Company’s remuneration policy. The Company has no intention of giving any such additional remuneration to Mr. Leung as it has never provided to any independent non-executive Director any remuneration other than the annual director’s fee.

As at the Latest Practicable Date, within the meaning of Part XV of the SFO, Mr. Leung does not have, and is not taken or deemed to have, any interests or short positions in any shares, underlying shares of equity derivatives or debentures of the Company and/or its associated corporations.

Save as disclosed above, Mr. Leung is not connected with any directors, chief executives, substantial shareholders or controlling shareholders or any of their respective associates (all as defined in the Listing Rules) of the Company.

Save as disclosed above, Mr. Leung does not hold any directorship in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years.

Save as disclosed above, there are no other matters concerning Mr. Leung that are required to be disclosed pursuant to paragraphs (h) to (v) of Listing Rule 13.51(2), nor any other matters or information that need to be brought to the attention of the Shareholders or required to be disclosed pursuant to any of the requirements of Listing Rule 13.51(2).

Ms. Chu Tsui Lan (“Ms. Chu”) , aged 41, is executive Director and general manager, China of the Group. She joined the Group in 1992. She has over 19 years of retail experience in Hong Kong and Mainland China. She is responsible for the Group’s retail and franchise business operations and development in Mainland China.

The Company entered into a service agreement with Ms. Chu which does not have any fixed term and may be terminated by either party by giving a three-months’ written notice, pursuant to which she is entitled to a fixed annual salary of HK$1,272,000 plus discretionary bonus (which is to be

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LETTER FROM THE BOARD

determined by the remuneration committee of the Company based on Ms. Chu’s performance with reference to the annual results of the Group). In addition, Ms. Chu shall be entitled to share options granted by the Company under the share option scheme from time to time adopted by the Company subject to compliance with the Listing Rules and the approval by the remuneration committee of the Company. The emolument of Ms. Chu (including the fixed salary and the bonus) is determined by the remuneration committee of the Company with reference to Ms. Chu’s qualification, experience and performance, and the profitability of the Group.

As at the Latest Practicable Date, Ms. Chu personally holds 2,100,000 Shares.

Save as disclosed above, within the meaning of Part XV of the SFO, Ms. Chu does not have, and is not taken or deemed to have, any interests or short positions in any shares, underlying shares of equity derivatives or debentures of the Company and/or its associated corporations.

As at the Latest Practicable Date, Ms. Chu is not connected with any directors, chief executives, substantial shareholders or controlling shareholders or any of their respective associates (as defined in the Listing Rules) of the Company. Ms. Chu also did not have any directorship held in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years.

Save as disclosed above, there are no other matters concerning Ms. Chu that are required to be disclosed pursuant to paragraphs (h) to (v) of Listing Rule 13.51(2), nor any other matters or information that need to be brought to the attention of the Shareholders or required to be disclosed pursuant to any of the requirements of Listing Rule 13.51(2).

ANNUAL GENERAL MEETING

The notice convening the Annual General Meeting is set out on pages 16 to 20 of this circular. A form of proxy is also enclosed with this circular and whether or not you intend to attend the Annual General Meeting, you are requested to complete the form of proxy and return it to the principal office of the Company in Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time for holding the Annual General Meeting. Completion of the form of proxy and returning it to the Company will not preclude you from attending, and voting at, the Annual General Meeting if you so wish.

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LETTER FROM THE BOARD

Procedures for Demand Poll

The procedures by which the Shareholders may demand a poll at the Annual General Meeting are as follows.

According to Bye-law 66, at any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless voting by way of poll is required by the rules of the Designated Stock Exchange or (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded:

• (a) by the chairman of such meeting; or

• (b) by at least three members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy for the time being entitled to vote at the meeting; or

• (c) by a member or members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy and representing not less than one-tenth of the total voting rights of all members having the right to vote at the meeting; or

• (d) by a member or members present in person (or in the case of a member being a corporation by its duly authorised representative) or by proxy and holding Shares in the Company conferring a right to vote at the meeting being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all Shares conferring the right.

A demand by a person as proxy for a member or in the case of a member being a corporation by its duly authorized representative shall be deemed to be the same as a demand by a member.

Notwithstanding any other provisions in the Bye-laws :

• (a) if the aggregate proxies held by the chairman of a particular general meeting and the Directors account for 5% or more of the total voting rights at that general meeting; and

• (b) if on a show of hands in respect of any resolution, the Shareholders at the general meeting vote in the opposite manner to that instructed in the proxies referred to in (a) above,

the chairman of the general meeting and/or any Director holding the proxies referred to above shall demand a poll provided that if it is apparent from the total proxies held by the persons referred to in (a) above that a vote taken on a poll will not reverse the vote taken on a show of hands, then no poll shall be required.

Pursuant to Listing Rule 13.39(4), any vote of shareholders at a general meeting must be taken by poll. Therefore, all resolutions proposed at the Annual General Meeting shall be voted by poll.

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LETTER FROM THE BOARD

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement herein misleading.

RECOMMENDATION

The Board believes that the ordinary resolutions to be put before the Annual General Meeting are in the best interests of the Company and the Shareholders as a whole. Accordingly, the Board recommends you to vote in favour of all the ordinary resolutions to be proposed at the Annual General Meeting.

Yours faithfully, For and on behalf of the Board Lee Tze Bun, Marces Chairman

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EXPLANATORY STATEMENT

APPENDIX

This Appendix serves as an explanatory statement as required by the Listing Rules to provide the requisite information to you for your consideration of the Repurchase Mandate.

SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company was HK$63,931,360 comprising 639,313,600 Shares.

Subject to the passing of the relevant ordinary resolutions as set out in the notice of the Annual General Meeting approving the Repurchase Mandate and assuming that no further Shares are issued and that no further Shares are purchased by the Company on or prior to the Annual General Meeting, the Directors will be authorized to purchase up to 63,931,360 Shares pursuant to the Repurchase Mandate.

The Company is also prohibited from making securities repurchases on the Stock Exchange if the repurchase would result in the number of listed securities in the hands of the public falling below 25% as required by the Stock Exchange.

REASONS FOR REPURCHASES

The Directors believe that it is in the best interests of the Company and the Shareholders to have a general authority from the Shareholders to enable the Directors to purchase Shares in the market at any appropriate time. Such purchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value of the Company and/or its earnings per Share and will only be made when the Directors believe that such purchases will benefit the Company and the Shareholders as a whole.

FUNDING OF REPURCHASES

In repurchasing Shares, the Company must apply funds legally available for such purpose in accordance with its Bye-laws and the laws of Bermuda. Under Bermuda law, the amount of capital paid by the Company in connection with a Share repurchase may only be paid out of either the capital paid up on the relevant Shares, or the funds of the Company that would otherwise be available for distribution by way of dividend or distribution or the proceeds of a new issue of Shares made for such purpose. The amount of premium payable on a repurchase of Shares by the Company may only be paid out of either the funds of the Company that would otherwise be available for dividend or distribution or out of the share premium account of the Company. Under Bermuda law, the Shares so repurchased will be treated as cancelled but the aggregate amount of the authorised share capital will not be reduced so that the Shares may be subsequently re-issued.

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APPENDIX

EXPLANATORY STATEMENT

Taking into account of the current working capital position of the Company, the Directors consider that, if the Repurchase Mandate were to be exercised in full, it might have a material adverse effect on the working capital and/or the gearing position of the Company as compared with the position disclosed in the audited consolidated financial statements of the Company in the annual report for the year ended 28 February 2011. However, the Directors do not propose to exercise the Repurchase Mandate to such an extent as could in the circumstances have a material adverse effect on the working capital or the gearing level of Company which in the opinion of the Directors is from time to time appropriate for the Company.

DIRECTORS, THEIR ASSOCIATES AND CONNECTED PERSONS

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates currently intends to sell Shares to the Company under the Repurchase Mandate in the event that it is granted by the Shareholders at the Annual General Meeting.

No connected person (as defined in the Listing Rules) has notified the Company that he has a present intention to sell any Shares to the Company, or has undertaken not to sell any Shares held by him to the Company, in the event that the Repurchase Mandate is granted by the Shareholders at the Annual General Meeting.

SHARE REPURCHASE MADE BY THE COMPANY

The Company has not purchased any of its Shares (whether on the Stock Exchange or otherwise) in the six months preceding the Latest Practicable Date.

DIRECTORS’ UNDERTAKING

The Directors have undertaken to the Stock Exchange that they will exercise the Repurchase Mandate in accordance with the Listing Rules and the applicable laws of Bermuda so far as the same may be applicable.

EFFECT ON THE TAKEOVERS CODE

If, on the exercise of the power by the Company to repurchase Shares pursuant to the Repurchase Mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of the Takeovers Code. As a result, a Shareholder or a group of Shareholders acting in concert (as defined in the Takeovers Code), depending on the level of such increase, could obtain or consolidate control of the Company and may become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

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APPENDIX

EXPLANATORY STATEMENT

As at the Latest Practicable Date, according to the register of interests required to be kept by the Company under the SFO, the Shareholders who were interested in 5% or more of the issued share capital of the Company were as follows:

Name Mr. Lee First Advisory Stable Gain Ms. Lee Wing Kam Rowena Jackie (“Ms. Lee”) Ms. Chui Kwan Ho, Jacky (“Ms. Chui”) Ms. Tsui Oi Kuen (“Ms. Tsui”) Ms. Lee, Ms. Chui and Ms. Tsui as trustees of The Lee Keung Charitable Foundation (“the Charitable Foundation”)

Number of Shares Approximate percentage of the issued share capital of the Company Personal interests Corporate interests Other interests Total 36,268,000 31,384,000 (Notes 1 & 2) 205,000,000 (Note 3) 272,652,000 42.65% — 205,000,000 (Note 3) — 205,000,000 32.07% — 205,000,000 (Note 3) — — 205,000,000 32.07% 6,350,000 — 50,000,000 (Note 4) 56,350,000 8.81% (Note 5) 3,946,000 — 50,000,000 (Note 4) 53,946,000 8.44% (Note 6) 1,180,000 — 50,000,000 (Note 4) 51,180,000 8.01% (Note 7) — — 50,000,000 (Note 4) 50,000,000 7.82%

Notes :

1. 30,000,000 Shares are held by Succex Limited, which is wholly owned by Mr. Lee. Therefore, Mr. Lee is deemed to be interested in those Shares.

2. 1,384,000 Shares are held by Xin Chuan Middle School Foundation Limited, of which Mr. Lee is a governor. Therefore, Mr. Lee is deemed to be interested in those Shares.

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EXPLANATORY STATEMENT

APPENDIX

Notes :

1. Stable Gain Holdings Limited (“Stable Gain“) holds 205,000,000 Shares, representing approximately 32.07% of the issued share capital of the Company. The entire issued share capital of Stable Gain is registered in the name of First Advisory Trustees Ltd. (“First Advisory”) as trustee of The Lee Keung Family Trust, a discretionary trust, of which Mr. Lee is the founder and an eligible beneficiary thereunder. Therefore, First Advisory and Mr. Lee are deemed to be interested in those Shares.

2. Ms. Chui, Ms. Tsui and Ms. Lee (the daughter of Mr. Lee) being the trustees of the Charitable Foundation, jointly hold 50,000,000 Shares, representing approximately 7.82% of the issued share capital of the Company. Therefore, Ms. Chui, Ms. Tsui and Ms. Lee are deemed to be interested in those Shares

3. Ms. Lee personally holds 6,350,000 Shares. Together with the Shares mentioned in (4) above, Ms. Lee is interested in an aggregate of 56,350,000 Shares, representing approximately 8.81% of the issued share capital of the Company.

4. Ms. Chui personally holds 3,946,000 Shares. Together with the Shares mentioned in (4) above, Ms. Chui is interested in an aggregate of 53,946,000 Shares, representing approximately 8.44% of the issued share capital of the Company.

5. Ms. Tsui personally holds 1,180,000 Shares. Together with the Shares mentioned in (4) above, Ms. Tsui is interested in an aggregate of 51,180,000 Shares, representing approximately 8.01% of the issued share capital of the Company.

Assuming no issue of Shares and repurchase of Shares between the Latest Practicable Date and the Annual General Meeting, and the Repurchase Mandate having been approved by the Shareholders, in the event that the Repurchase Mandate is exercised in full, the substantial Shareholders and the parties named above who are taken to be acting in concert (i.e. First Advisory, Stable Gain, Succex Limited, Xin Chuan, Mr. Lee and Ms. Lee) in aggregate control the voting rights of 51.46% and 57.18% of the entire issued Shares before and after such repurchase respectively. There may be consequences which would arise under the Takeovers Code as a consequence of any repurchase made pursuant to the Repurchase Mandate. If any Shareholder or a group of Shareholders acting in concert will become obliged to make mandatory offer in accordance with Rule 26 of the Takeovers Code by virtue of the exercise of the Repurchase Mandate, such Shareholder or group of Shareholders acting in concert will comply with the Takeovers Code.

The Company has no intention to purchase Shares to such an extent which will result in the amount of Shares held by the public being reduced to less than 25%.

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EXPLANATORY STATEMENT

APPENDIX

SHARE PRICES

The highest and lowest prices at which the Shares have been traded on the Stock Exchange during the 12 months preceding the Latest Practicable Date were as follows:

	**Share **	prices
	Highest	Lowest
	HK$	HK$
2010
July	3.28	2.48
August	3.51	2.90
September	4.38	3.38
October	5.75	3.86
November	4.80	3.57
December	4.50	3.89
2011
January	4.40	3.61
February	4.10	3.67
March	3.90	3.42
April	4.20	3.60
May	4.15	3.60
June*	3.96	3.79

* Up to and including the Latest Practicable Date

SHAREHOLDERS’ APPROVAL

The Listing Rules provide that all proposed repurchases of securities by a company with primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, either by way of general mandate or by specific approval of a particular transaction.

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NOTICE OF ANNUAL GENERAL MEETING

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(Incorporated in Bermuda with limited liability)

(Stock Code : 0738)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the annual general meeting of Le Saunda Holdings Limited (the “ Company ”) will be held at Harbour Grand Hong Kong, Salon Rooms VI-VII, 5/F, MTR Fortress Hill Station, Exit A, 23 Oil Street, North Point, Hong Kong on Monday, 18 July 2011 at 10:30 a.m. for the following purposes:

As ordinary business:

1. To receive and consider the audited financial statements of the Company and the reports of the Directors and auditors, and Corporate Governance Report for the year ended 28 February 2011.

2. To consider and declare a final dividend of HK8.7 cents per Share for the financial year ended 28 February 2011.

3. To re-elect the retiring Directors, to authorize the Directors to appoint any person as a director either to fill a casual vacancy or as an addition to the existing Board of Directors, and to authorize the Board to fix the Directors’ remuneration.

4. To re-appoint auditors and to authorize the Board to fix their remuneration.

As special business:

ORDINARY RESOLUTIONS

To consider and, if thought fit, pass with or without modifications, the following resolutions as ordinary resolutions:

1. “ THAT :

   • (a) the general mandate granted to the Directors of the Company to exercise the powers of the Company to allot and issue ordinary shares of HK$0.10 each in the share capital

2. For identification purposes only

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NOTICE OF ANNUAL GENERAL MEETING

of the Company (“Shares”) as approved by the shareholders of the Company pursuant to an ordinary resolution passed at the annual general meeting of the Company held on 19 July 2010 be and is hereby revoked (without prejudice to any valid exercise of such general mandate prior to the passing of this resolution);

• (b) subject to paragraph (d) of this resolution, the exercise by the Directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional Shares and to make or grant offers, agreements and options which would or might require the exercise of such power be and is hereby generally and unconditionally approved;

• (c) the approval in paragraph (b) of this resolution shall authorize the Directors of the Company during the Relevant Period (as hereinafter defined) to make or grant offers, agreements and options (including warrants, bonds, notes and other securities which carry rights to subscribe for or are convertible into Shares) which would or might require the exercise of such power after the end of the Relevant Period;

• (d) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) and issued by the Directors of the Company pursuant to the approval in paragraph (b) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); (ii) or the exercise of rights of conversion or subscription under the terms of any securities which are convertible into Shares or any share option scheme or similar arrangement of the Company for the time being adopted for the grant or issue to eligible persons of Shares or rights to acquire Shares; or (iii) an issue of Shares as scrip dividends or similar arrangement providing for the allotment of Shares in lieu of the whole or part of a dividend in accordance with the Bye-laws of the Company, shall not exceed in total 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of this resolution, and the said approval shall be limited accordingly; and

• (e) for the purposes of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earliest of :

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-laws of the Company or any applicable laws of Bermuda to be held; and

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting.

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NOTICE OF ANNUAL GENERAL MEETING

“Rights Issue” means an offer of Shares or issue of options, warrants or other securities giving the right to subscribe for Shares, open for a period fixed by the Directors of the Company to holders of Shares whose names appear on the register of members of the Company on a fixed record date in proportion to their then holdings of such Shares (subject to such exclusions to other arrangements as the Directors of the Company may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws, or the requirements of, any recognized regulatory body or any stock exchange in any territory outside Hong Kong).”

1. “ THAT :

2. (a) the general mandate granted to the Directors of the Company to exercise the powers of the Company to repurchase ordinary shares HK$0.10 each in the share capital of the Company (“Shares”) pursuant to an ordinary resolution passed by the shareholders of the Company at the annual general meeting of the Company held on 19 July 2010 be and is hereby revoked (but without prejudice to any exercise of such mandate prior to the passing of this resolution);

3. (b) subject to paragraph (c) of this resolution, the exercise by the Directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to repurchase Shares on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the securities of the Company may be listed and recognized by the Securities and Futures Commission of Hong Kong and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws and the requirements of the Rules Governing the Listing of Securities on the Stock Exchange or of any other stock exchange as amended from time to time, be and is hereby generally and unconditionally approved;

4. (c) the aggregate nominal amount of the Shares which the Company is authorized to repurchase pursuant to the approval in paragraph (b) of this resolution shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing of this resolution, and the said approval shall be limited accordingly; and

5. (d) for the purpose of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earliest of :

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-laws of the Company or any applicable laws of Bermuda to be held; and

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NOTICE OF ANNUAL GENERAL MEETING

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting.”

• “ THAT conditional upon ordinary resolutions numbered 5 and 6 set out in the notice convening this meeting becoming unconditional and effective, the aggregate nominal amount of the share capital of the Company which are repurchased by the Company pursuant to the authority granted to the Directors of the Company in accordance with the said resolution numbered 6 set out in the notice convening this meeting shall be added to the aggregate nominal amount of share capital that may be allotted, issued or dealt with or agreed conditionally or unconditionally to be allotted, issued or dealt with by the Directors of the Company pursuant to and in accordance with ordinary resolution numbered 5 set out in the notice convening this meeting.”

On behalf of the Board Yuen Chee Wing Company Secretary

Hong Kong, 10 June 2011

As at the date hereof, the Board comprises four executive Directors, namely Mr. Lee Tze Bun, Marces, Ms. Lau Shun Wai, Ms. Wong Sau Han and Ms Chu Tsui Lan, one non-executive Director, namely Mr. James Ngai and three independent non-executive Directors, namely Mr. Lam Siu Lun, Simon, Mr. Leung Wai Ki, George and Mr. Hui Chi Kwan.

Principal place of business in Hong Kong:

17th Floor 1063 King’s Road Quarry Bay Hong Kong

Notes:

1. A form of proxy for use at the meeting is being despatched to the shareholders of the Company together with a copy of this notice.

2. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorized in writing or, if the appointor is a corporation, either under its seal or under the hand of any officer, attorney or other person duly authorized to sign the same.

3. Any shareholder entitled to attend and vote at the meeting convened by the above notice shall be entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a member of the Company.

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NOTICE OF ANNUAL GENERAL MEETING

1. In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power of attorney or authority, must be deposited at the Company’s principal office in Hong Kong at 17th Floor, 1063 King’s Road, Quarry Bay, Hong Kong not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof.

2. The register of members of the Company will be closed from Friday, 15 July 2011 to Monday, 18 July 2011, both days inclusive, during which period no transfer of shares will be effected. In order to qualify for the final dividend which, if approved, will be payable on 26 July 2011, all transfers accompanied by the relevant share certificates and transfer forms must be lodged with Computershare Hong Kong Investor Services Limited, Unit 1712-1716, 17/F, Hopewell Centre, 183 Queen’s Road East, Hong Kong for registration no later than 4:30 p.m. on Thursday, 14 July 2011.

3. Completion and deposit of the form of proxy will not preclude a shareholder of the Company from attending and voting in person at the meeting convened or any adjourned meeting and in such event, the form of proxy will be deemed to be revoked.

4. Where there are joint holders of any share of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the meeting, the most senior shall alone be entitled to vote, whether in person or by proxy. For this purpose, seniority shall be determined by the order in which the names stand on the register of members of the Company in respect of the joint holding.

5. A circular containing further details regarding resolutions 5 and 6 as required by the Rules Governing the Listing of Securities in the Stock Exchange of Hong Kong Limited will be despatched to the shareholders of the Company together with the 2011 Annual Report on or before 30 June 2011.

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