Baoye Group Company Limited — Proxy Solicitation & Information Statement 2005

Nov 24, 2005

IMPORTANT

If you are in doubt about this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Plus Holdings Limited, you should at once hand this circular to the purchaser or the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

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.

==> picture [160 x 52] intentionally omitted <==

(Stock code: 1013)

GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE SHARES, APPOINTMENT OF NEW DIRECTORS, RE-ELECTION OF RETIRING DIRECTORS, AND NOTICE OF ANNUAL GENERAL MEETING

Resolutions will be proposed at the AGM of Plus Holdings Limited to be held at Salisbury Room, Level 7, Conrad Hotel, Pacific Place, 88 Queensway, Hong Kong on 23 December 2005 (Friday) at 10:00 a.m. to approve the matters referred to in this circular. If you are unable to attend the AGM in person, you are requested to complete and return the form of proxy enclosed with this circular in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting. Completion and delivery of the form of proxy will not preclude you from attending and voting at the meeting if you so wish.

* for identification purpose only

24 November 2005

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Chairman
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
General Mandate to Repurchase Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Extend General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Procedures by which a Poll may be Demanded . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Explanatory Statement of the Share Repurchase Mandate. . . . . . . . . . . . . . . . . . . . . . . . . .	9
Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12

– i –

DEFINITIONS

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

“2005 Annual Report”	the Audited Consolidated Financial Statements and the
	Reports of the Directors and Auditors of the Company for
	the year ended 31 March 2005;
“AGM”	the annual general meeting of the Company to be held at
	Salisbury Room, Level 7, Conrad Hotel, Pacific Place, 88
	Queensway, Hong Kong on 23 December 2005 (Friday) at
	10:00 a.m. at which the 2005 Annual Report will be adopted;
“Bye-laws”	the existing bye-laws of the Company;
“Company”	Plus Holdings Limited, a company incorporated in Bermuda
	with limited liability, the Shares of which are listed on the
	Stock Exchange;
“Directors”	directors of the Company;
“Listing Rules”	the Rules Governing the Listing on Securities of the Stock
	Exchange;
“Latest Practicable Date”	21 November 2005, being the latest practicable date prior
	to the printing of this circular;
“New Issue Mandate”	the general mandate to allot, issue and deal with Shares not
	exceeding 20% of the issued share capital of the Company
	as at the date of passing of the resolution approving the
	New Issue Mandate;
“Model Code”	Model Code for Securities Transactions by Directors of
	Listed Companies;
“PRC”	the People’s Republic of China;
“SFO”	the Securities and Futures Ordinance (Cap. 571 of the Laws
	of Hong Kong);

– 1 –

DEFINITIONS

“Share Repurchase Mandate”	the general mandate to exercise the power of the Company
	to repurchase Shares up to a maximum of 10% of the issued
	share capital of the Company as at the date of the resolution
	approving the Share Repurchase Mandate;
“Shareholder(s)”	holder(s) of issued Shares in the Company;
“Share(s)”	ordinary shares of HK$0.10 each in the share capital of the
	Company;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited; and
“Takeover Code”	The Hong Kong Codes on Takeovers and Mergers and Share
	Repurchases approved by the Securities and Futures
	Commission as amended from time to time.

– 2 –

LETTER FROM THE CHAIRMAN

==> picture [160 x 52] intentionally omitted <==

(Stock code: 1013)

Executive Directors:

Mr. Zou Yishang (Chairman and Chief Executive Officer) Mr. Hu Jian (Chief Operating Officer)

Ms. Chow King Lin, Theresa Mr. Cui Jingya Mr. Zou Yicheng

Non-executive Director:

Mr. Weng Xianding

Registered Office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Principal Place of Business in Hong Kong: Room C, 7th Floor, Sun House 90 Connaught Road Central Hong Kong

Independent Non-executive Directors:

Mr. Zhao Renwei Mr. Wang Xiangfei Mr. Xu Xiaosheng

24 November 2005

To the Shareholders

Dear Sirs or Madam,

GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE SHARES, APPOINTMENT OF NEW DIRECTORS, RE-ELECTION OF RETIRING DIRECTORS, AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

It is proposed that at the AGM of the Company for the year ended 31 March 2005, ordinary resolutions will be proposed to grant to the Directors, general mandates to repurchase and issue Shares, to extend general mandate to issue Shares. This circular contains the explanatory statement in compliance with the Listing Rules and gives all the information reasonably necessary to enable Shareholders to make an informed decision on whether to vote for or against the resolutions to approve the Company to repurchase and issue its own Shares.

• for identification purpose only

– 3 –

LETTER FROM THE CHAIRMAN

GENERAL MANDATE TO REPURCHASE SHARES

At the AGM, an ordinary resolution will be proposed to grant the Share Repurchase Mandate to the Directors to enable them to repurchase Shares subject to the criteria set out in this circular. Shareholders should note that the maximum number of shares that may be repurchased is up to 10% of the aggregate nominal amount of the share capital of the Company in issue at the date of passing of the relevant resolution. The Share Repurchase Mandate to repurchase Shares will remain in effect until whichever is the earliest: the date of the next annual general meeting, the date by which the next annual general meeting is required to be held by law and, the date upon which such authority is revoked or varied by an ordinary resolution of the Shareholders in a general meeting of the Company.

GENERAL MANDATE TO ISSUE SHARES

At the AGM, an ordinary resolution will be proposed to grant the New Issue Mandate to the Directors to allot, issue and deal with, other than by way of rights or any option scheme or similar arrangement for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of shares or rights to acquire Shares in the Company or any Shares of the Company issued as scrip dividends pursuant to the Bye-laws of the Company, Shares with an aggregate nominal value not exceeding 20% of the aggregate of the total nominal value of the share capital of the Company in issue on the date of the resolution approving the New Issue Mandate. The New Issue Mandate to issue Shares will remain in effect until whichever is the earliest: the date of the next annual general meeting, the date by which the next annual general meeting is required to be held by law and, the date upon which such authority is revoked or varied by an ordinary resolution of the Shareholders in a general meeting of the Company.

EXTEND GENERAL MANDATE TO ISSUE SHARES

At the AGM, an ordinary resolution will be proposed that the New Issue Mandate will be extended by the addition to the aggregate nominal value of the share capital of the Company which may be allotted or agreed conditionally to be allotted by the Directors pursuant to such general mandate of an amount representing the aggregate nominal value of the share capital of the Company repurchased by the Company pursuant to the Share Repurchase Mandate, provided that such extended amount will not exceed 10% of the aggregate of the total nominal value of the issued share capital of the Company in issue on the date of the resolution approving the New Issue Mandate.

– 4 –

LETTER FROM THE CHAIRMAN

RE-ELECTION OF DIRECTORS

I. Appointment of New Directors

On 30 September 2004, the board of directors (the “Board”) of the Company announced that Mr. Wang Xiangfei (“Mr. Wang”) and Mr. Xu Xiaosheng (“Mr. Xu”) were appointed as independent non-executive directors of the Company on 30 September 2004 with immediate effect.

In accordance with article 86(2) of the Bye-laws of the Company, Mr. Wang and Mr. Xu will retire at the forthcoming AGM and, being eligible, offer themselves for re-election. Biographical details of Mr. Wang and Mr. Xu are as listed below.

Mr. Wang, aged 53, graduated from the People’s University of China, major in finance, accounting and banking, holds a bachelor degree in Economics. Mr. Wang is a qualified senior accountant in the People’s Republic of China. He is also an independent non-executive director of three public companies listed on the Stock Exchange, namely Tianjin Capital Environmental Protection Company Limited, Chongqing Iron & Steel Company Limited and SEEC Media Group Limited. Mr. Wang has extensive business connections and experiences in investment, business administration, finance, accounting and trading.

Mr. Xu , aged 53, holds a master of art degree in finance and banking from the Graduate School of the People’s Bank of China and a bachelor degree in finance from the Shanxi Financial and Economic University. Mr. Xu currently is the Chairman of Howbon Assets Ltd., a privatelyowned asset management company, and has over 16 years’ experience in investment and finance industry.

Save as disclosed above, Mr. Wang and Mr. Xu do not hold any directorship with other public listed company as at the Latest Practicable Date. They have not held any position in the Company or its subsidiaries and do not have any interest in Shares of the Company within the meaning of Part XV of the SFO nor they have any relationship with the directors, senior management or substantial or controlling shareholders of the Company.

There is no service contract entered into between the Company and Mr. Wang or Mr. Xu. Each of Mr. Wang and Mr. Xu is receiving annual emolument of HK$120,000. Their emoluments are determined by reference to their experience and duties as well as the prevailing market conditions and the current financial position of the Company.

Saved as disclosed above, there is no other matter in relation to the re-election of Mr. Wang and Mr. Xu that need to be brought to the attention of the Stock Exchange or the Shareholders.

– 5 –

LETTER FROM THE CHAIRMAN

On 12 May 2005, the Board announced that Mr. Zou Yicheng (“Mr. Zou”) and Mr. Cui Jingya (“Mr. Cui”) were appointed as executive directors of the Company with immediate effect.

Mr. Zou, aged 38, is the brother of Mr. Zou Yishang, the chairman and chief executive officer of the Company. Mr. Zou graduated from the Chinese People’s Liberation Army Armoured Force Engineering College, holds a bachelor degree in Engineering. Mr. Zou served for the Chinese People’s Liberation Army for over ten years. He has over 5 years’ relevant experience in business management. He is also a director of certain subsidiaries of the Company. Mr. Zou has not held any directorship in any listed companies within the past three years. As at the Latest Practicable Date, Mr. Zou is deemed to have interest in 1,350,000 Shares of the Company, representing approximately 0.10% of the entire issued share capital of the Company. Save as disclosed above, Mr. Zou does not hold any other interest in Shares of the Company within the meaning of Part XV of the SFO.

Mr. Cui, aged 67, is the father-in-law of Mr. Zou Yishang, the chairman and chief executive officer of the Company. Mr. Cui holds a bachelor degree in Science from the China University of Science and Technology. Mr. Cui had worked for the government bureaus of the People’s Republic of China for over thirty-two years. Mr. Cui has not held any directorship in any listed companies within the past three years and he does not hold any position in the Company or its subsidiaries. As at the Latest Practicable Date, Mr. Cui does not have any interest in Shares of the Company within the meaning of Part XV of the SFO.

There is no service contract entered into between the Company and Mr. Zou or Mr. Cui. Mr. Zou and Mr. Cui are receiving annual emolument of HK$300,000 and HK$120,000 respectively. Their emoluments are determined by reference to their experience and duties as well as the prevailing market conditions and the current financial position of the Company.

Save as disclosed above, each of Mr. Zou and Mr. Cui does not have any relationships with any other directors, senior management, substantial shareholders, or controlling shareholders of the Company. There is no other matter in relation to the re-election of Mr. Zou and Mr. Cui that need to be brought to the attention of the Stock Exchange or the Shareholders.

– 6 –

LETTER FROM THE CHAIRMAN

II. Retiring Directors

Pursuant to clauses 87(1) and 87(2) of the Bye-laws of the Company, Mr. Zhao Renwei (“Mr. Zhao”) and Ms. Chow King Lin, Theresa (“Ms. Chow”) (the “Retiring Directors”) shall retire at the AGM by rotation and, being eligible, will offer themselves for re-election. Biological details of the Retiring Directors are as listed below.

Mr. Zhao, aged 72, is a distinguished economist in China and the former Head of the Institute of Economics, Chinese Academy of Social Sciences. He joined the Company as an independent non-executive director in June 2000. Save as disclosed above, Mr. Zhao has not held any other position in the Company or its subsidiaries.

Ms. Chow, aged 42, joined the Company as the Head of Capital Markets in August 2000. She has 14 years of experience in international financial markets, providing investment services to private and corporate clients during her service with Merrill Lynch (Asia Pacific) Ltd. and Goldman Sachs (Asia) L.L.C. prior to joining the Company. She was appointed as an executive director of the Company in September 2002. Ms. Chow was also appointed as a director of certain subsidiaries of the Company.

There is no service contract entered into between the Company and Mr. Zhao or Ms. Chow. Mr. Zhao and Ms. Chow are receiving annual emolument of HK$50,000 and HK$624,000, respectively. Their emoluments are determined by reference to their experience and duties as well as the prevailing market conditions and the current financial position of the Company.

As at the Latest Practicable Date, the aggregate long position in Shares and underlying Shares held by Ms. Chow is 2,006,000 shares, representing approximately 0.14% of the entire issued share capital of the Company. Save as disclosed above, both Ms. Chow and Mr. Zhao do not have any interests or short positions in the Shares, underlying Shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) as required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein or which were required, pursuant to the Model Code, to be notified to the Company and the Stock Exchange.

Both Mr. Zhao and Ms. Chow do not hold any directorship with other public listed company as at the Latest Practicable Date. They do not have any relationship with the directors, senior management or substantial or controlling shareholders of the Company.

Save as disclosed above, there is no other matter in relation to the re-election of Mr. Zhao and Ms. Chow that needs to be brought to the attention of the Stock Exchange or the Shareholders.

The directors are required to tender their termination notice to the Company upon their resignation of the post. Mr. Zou Yishang is required to give not less than six months’ prior notice in writing and the other directors are required to give one month’s prior notice in writing.

Saved as disclosed above, the directors are not entitled to any compensation upon their resignation.

– 7 –

LETTER FROM THE CHAIRMAN

ANNUAL GENERAL MEETING

The AGM Notice convening the AGM is enclosed with this circular. At the AGM, resolutions will be proposed to approve, inter alia, (a) granting to the Directors a general mandate to repurchase up to 10% of the aggregate nominal amount of the share capital of the Company at the date of passing such resolution; (b) granting to the Directors a general mandate to allot, issue and deal with Shares of up to 20% of the aggregate nominal amount of the share capital of the Company in issue at the date of the passing of such resolution; and (c) granting to the Directors a general mandate to extend the proposed New Issue Mandate to allot Shares by the addition to the aggregate of the total nominal value of the share capital of the Company repurchased by the Company pursuant to the Share Repurchase Mandate (up to a maximum of 10% of the aggregate nominal amount of the Company’s issued share capital as at the date of passing such resolution).

PROCEDURES BY WHICH A POLL MAY BE DEMANDED

Pursuant to Bye-law 66 of the Company, a resolution put to the vote of a general meeting shall be decided on a show of hands unless (before or on the declaration of the result of the show of hands or on the withdrawal or any other demand for a poll) a poll is demanded by (i) the chairman of such meeting; or (ii) at least three Shareholders present in person or in the case of a Shareholder being a corporation by its duly authorized representative or by proxy for the time being entitled to vote at the meeting; or (iii) by Shareholder(s) present in person or in the case of a Shareholder being a corporation by its duly authorized representative or by proxy and representing not less than one-tenth of the total voting rights of all Shareholders having the right to vote at the meeting; or (iv) Shareholder(s) present in person or in the case of a Shareholder being a corporation by its duly authorized 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 the Shares conferring that right.

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

RECOMMENDATION

The Directors consider that the Share Repurchase Mandate, the New Issue Mandate and the extension of the New Issue Mandate are in the best interests of the Company and its Shareholders, so they recommend you to vote in favour of the resolutions at the AGM.

Yours faithfully,

For and on behalf of the Board of

PLUS HOLDINGS LIMITED

Zou Yishang

Chairman & CEO

– 8 –

EXPLANATORY STATEMENT OF THE SHARE REPURCHASE MANDATE

The following explanatory statement contains all the information required pursuant to Rule 10.06 of the Listing Rules to be given to all Shareholders relating to a resolution to be proposed at the AGM authorizing the Share Repurchase Mandate.

1. EXERCISE OF THE REPURCHASE MANDATE

As at the Latest Practicable Date, the Company has 1,391,162,483 ordinary Shares in issue. In the event that the Share Purchase Mandate is fully exercised by the Directors pursuant to the Share Repurchase Mandate, 139,116,248 Shares will be repurchased and cancelled as required by the provisions in the Listing Rules regulating such share repurchases.

2. REASONS FOR REPURCHASE

The Directors have no present intention to repurchase any Shares but consider that the mandate will provide the Company the flexibility to make such repurchase when appropriate and beneficial to the Company. Such repurchase may enhance the net assets value of the Company and/ or earnings per Share.

3. FUNDING OF REPURCHASE

The Company is empowered by its memorandum of association and Bye-laws to purchase its Shares. Bermuda law provides that the amount of capital repaid 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 dividend or distribution or the proceeds of a new issue of shares made for such purpose. The amount of premium payable on repurchase may only be paid out of the funds of the Company that would otherwise be available for dividend or distribution, or out of the share premium accounts of the Company before the Shares are repurchased. According to the laws of Bermuda, Shares so repurchased will be treated as cancelled, but the aggregate amount of authorized share capital will not be reduced so that the Shares may be subsequently re-issued.

4. GENERAL

As compared with the financial position of the Company as at 31 March 2005 (being the date of its latest published audited financial statements), the Directors consider that there would be a material adverse impact on the working capital and on the gearing position of the Company in the event that the proposed purchases were to be carried out in full during the proposed purchase period. The Directors confirm that no purchase would be made in circumstances that would have a material adverse impact on the working capital or gearing position of the Company.

– 9 –

EXPLANATORY STATEMENT OF THE SHARE REPURCHASE MANDATE

5. 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 (as defined in the Listing Rules) has any present intention, in the event that the proposal is approved by Shareholders, to sell Shares to the Company.

No connected person of the Company (as defined in the Listing Rules) has notified the Company that he/she has a present intention to sell Shares to the Company nor has he/she undertaken to sell any Shares held by him/her to the Company in the event that the Company is authorized to repurchase the Shares.

6. UNDERTAKING OF THE DIRECTORS

The Directors have undertaken to the Stock Exchange to exercise the power of the Company to make repurchases pursuant to the Share Repurchase Mandate in accordance with the Listing Rules and all applicable laws of Bermuda, and in accordance with the regulations set out in the memorandum of association and Bye-laws of the Company.

7. EFFECT OF TAKEOVER CODE

If on exercise of the power to repurchase Shares pursuant to the Share 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 Takeover Code. As a result, a Shareholder or a group of Shareholders, acting in concert could, depending on the level of increase of Shareholders interest, obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rules 26 or 32 of the Takeover Code. The Directors are not aware of any Shareholder, or a group of Shareholders acting in concert, who may become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeover Code in the event that the Directors exercise the power to repurchase Shares pursuant to the Share Repurchase Mandate.

As at the Latest Practicable Date, to the best of their knowledge and belief of the Directors, Able Technology Limited, a private company wholly-owned by Mr. Zou Yishang, the chairman and chief executive officer of the Company and his associates together holding approximately 18.65% of the issued share capital of the Company, were the only substantial Shareholders holding more than 10% of the issued share capital of the Company. In the event that the Directors should exercise in full the powers to repurchase Shares pursuant to the Share Repurchase Mandate, the shareholding of Able Technology Limited and his associates in the Company would be increased to approximately 20.72% of the issued share capital of the Company. The Directors believe that such increase would not give rise to an obligation to make a mandatory offer under Rules 26 and 32 of the Takeover Code. The Directors have no present intention to exercise the Share Repurchase

– 10 –

EXPLANATORY STATEMENT OF THE SHARE REPURCHASE MANDATE

Mandate to such an extent that it would trigger a takeover obligation by the controlling Shareholder. Save as aforesaid, the Directors are not aware of any consequences which would arise under the Takeover Code as a consequence of any repurchases pursuant to the Share Repurchase Mandate. The Directors may not purchase Shares on the Stock Exchange if that purchase would result in the number of Shares which are in the hands of the public falling below 25% of the Company’s issued share capital.

8. SHARE PURCHASE MADE BY THE COMPANY

During each of six months preceding the Latest Practicable Date, no Shares have been repurchased by the Company.

9. SHARE PRICES

The highest and lowest prices at which Shares have been traded on the Stock Exchange in each of the previous twelve months before the Latest Practicable Date were as follows:

	Price	per share
Months	Highest	Lowest
	HK$	HK$
2004
July	0.059	0.033
August	0.045	0.038
September	0.052	0.038
October	0.065	0.046
November	0.071	0.050
December	0.060	0.060
2005
January*	N/A*	N/A*
February*	N/A*	N/A*
March*	N/A*	N/A*
April*	N/A*	N/A*
May*	N/A*	N/A*
June*	N/A*	N/A*
July*	N/A*	N/A*
August*	N/A*	N/A*
September*	N/A*	N/A*
October*	N/A*	N/A*

* Trading was suspended during this month

– 11 –

NOTICE OF ANNUAL GENERAL MEETING

==> picture [160 x 52] intentionally omitted <==

(Stock code: 1013)

NOTICE IS HEREBY GIVEN that an Annual General Meeting of Plus Holdings Limited (the “Company”) for the year 2005 will be held at Salisbury Room, Level 7, Conrad Hotel, Pacific Place, 88 Queensway, Hong Kong on 23 December 2005 (Friday) at 10:00 a.m. for the following purposes:

1. To receive and consider the audited financial statements of the Company and the reports of the directors and the auditors for the year ended 31 March 2005;

2. To re-elect directors and to authorize the Board of Directors to fix their remuneration;

3. To re-appoint Morison Heng as auditors of the Company and to authorize the Board of Directors to fix their remuneration;

4. As special business to consider and, if thought fit, passing, with or without modifications, the following resolutions as Ordinary Resolutions of the Company:

ORDINARY RESOLUTIONS

• A. “ THAT :

  • (a) subject to paragraph (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and otherwise deal with additional Shares or securities convertible into Shares, or options, warrants or similar rights to subscribe for any Shares, and to make or grant offers, agreements and options which might require the exercise of such power be and is hereby generally and unconditionally approved;

  • (b) the approval in paragraph (a) above shall be in addition to any other authorizations given to the Directors and shall authorize the Directors during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such power after the end of the Relevant Period;

• for identification purpose only

– 12 –

NOTICE OF ANNUAL GENERAL MEETING

• (c) the aggregate nominal amount of the share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (a) above, otherwise than pursuant to:–

• (i) a Right Issue (as hereinafter defined);

• (ii) the exercise of rights of subscription or conversion under terms of any warrants issued by the Company or any securities which are convertible into Shares;

• (iii) the exercise of any option scheme or similar arrangement for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of Shares or right to acquire Shares;

• (iv) any scrip dividend or similar arrangements providing for the allotment of Shares in lieu of the whole or part of a dividend on Shares in accordance with the bye-laws of the Company;

shall not exceed 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of passing of this Resolution and the said approval shall be limited accordingly;

• (d) subject to the passing of each of the paragraphs (a), (b) and (c) of this Resolution, any prior approvals of the kind referred to in paragraphs (a), (b) and (c) of this Resolution which had been granted to the Directors and which are still in effect be and are hereby revoked; and

• (e) for the purpose of this Resolution:

“Relevant Period” means the period from the passing this Resolution until whichever is the earlier 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 any applicable law of Bermuda or the bye-laws of the Company to be held; or

– 13 –

NOTICE OF ANNUAL GENERAL MEETING

• (iii) the revocation or variation of the authority given under this Resolution by ordinary resolution of the Shareholders of the Company in general meeting;

“Rights Issue” means the allotment, issue or grant of Shares pursuant to an offer of Shares open for a period fixed by the Directors to holders of Shares or any class thereof on the register on a fixed record date in proportion to their then holdings of such Shares or class thereof (subject to such exclusion or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements, or having regard to any restrictions or obligations under the laws of, or the requirements of, any recognized regulatory body or any stock exchange in any territory outside Hong Kong).”

• B. “ THAT :

• (a) subject to paragraph (b) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all powers of the Company to repurchase the Shares subject to in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

• (b) the aggregate nominal amount of Shares which may be repurchased pursuant to the approval in paragraph (a) above shall not exceed 10 per cent. 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;

• (c) subject to passing of each of the paragraphs (a) and (b) of this Resolution, any prior approvals of the kind referred to in paragraphs (a) and (b) of this Resolution which had been granted to the Directors and which are still in effect be and are hereby revoked; and

• (d) for the purpose of this Resolution, “Relevant Period” means the period from the passing of this Resolution until whichever is the earlier 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 any applicable law of Bermuda or the bye-laws of the Company to be held; or

– 14 –

NOTICE OF ANNUAL GENERAL MEETING

(iii) the revocation or variation of the authority given under this Resolution by ordinary resolution of the shareholders of the Company in general meeting;”

C. “ THAT :

conditional upon the passing of the Resolutions A and B as set out in the notice of this meeting, the general mandate granted to the Directors to exercise the powers of the Company to allot, issue and otherwise deal with Shares of the Company pursuant to Resolution A above be and is hereby extended by the addition to the aggregate nominal amount of the share capital of the company which may by allotted by the Directors pursuant to such general mandate an amount representing the aggregate nominal amount of the share capital of the Company repurchased by the Company under the authority granted pursuant to Resolution B above, provided that such amount shall not exceed 10 per cent. of the aggregate nominal mount of the share capital of the Company in issue at the date of passing of this Resolution.”

Yours faithfully,

For and on behalf of the Board of

PLUS HOLDINGS LIMITED Zou Yishang

Chairman and CEO

Hong Kong, 24 November 2005

Principal Office:

Room C, 7th Floor, Sun House 90 Connaught Road Central Hong Kong

Notes:

1. A shareholder of the Company entitled to attend and vote at the meeting convened by the above notice is entitled to appoint proxies to attend and vote in his stead in accordance with the bye-laws of the Company. A proxy need not be a shareholder of the Company. If more than one proxy is so appointed, the appointment shall specify the number and class of shares in respect of which each such proxy is so appointed.

2. The instrument appointing proxy and the power of attorney or other authority, if any, under which it is signed, or a certified copy of such power or authority, must be lodged with the Company’s share registrar in Hong Kong, Tengis Limited, at G/F., BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong not less than 48 hours before the time fixed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person as the meeting or any adjourned meeting should you so wish.

– 15 –