Beijing Enterprises Water Group Limited — Proxy Solicitation & Information Statement 2002

Oct 22, 2002

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect 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 Shang Hua Holdings Limited, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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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SHANG HUA HOLDINGS

SHANG HUA HOLDINGS LIMITED 上華控股有限公司[*]

(Incorporated in Bermuda with limited liability)

PROPOSED AMENDMENTS TO THE BYE-LAWS

A letter from the board of directors of Shang Hua Holdings Limited is set out on pages 2 to 4 of this circular.

A notice convening a special general meeting of Shang Hua Holdings Limited to be held on 15th November, 2002 at Room 701, 7th Floor, Sino Industrial Plaza, 9 Kai Cheung Road, Kowloon Bay, Kowloon, Hong Kong at 3:30 p.m. (or so soon thereafter as the annual general meeting of Shang Hua Holdings Limited convened at the same place and date at 3:00 p.m. shall have been concluded or adjourned) is set out on pages 5 to 8 of this circular.

Whether or not you are able to attend such meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the branch share registrar of Shang Hua Holdings Limited in Hong Kong, Tengis Limited at 4/F, Hutchison House, 10 Harcourt Road, Central, Hong Kong as soon as possible and in any event not later than forty-eight (48) hours before the time appointed for the holding of such meeting or any adjournment thereof.

Completion and return of the form of proxy shall not preclude you from attending and voting in person at the meeting or any adjourned meeting should you so desire.

22nd October, 2002

* For identification purpose only

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
Notice of special general meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5

DEFINITIONS

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

“AGM”	the annual general meeting of the Company to be held at Room
	701, 7th Floor, Sino Industrial Plaza, 9 Kai Cheung Road, Kowloon
	Bay, Kowloon, Hong Kong on 15th November, 2002, at 3:00 p.m.
“Board”	the board of Directors
“Bye-laws”	the bye-laws of the Company
“Company”	Shang Hua Holdings Limited, a company incorporated in Bermuda
	with limited liability
“Directors”	the directors of the Company
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s
	Republic of China
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“SGM”	the special general meeting of the Company to be held at Room
	701, 7th Floor, Sino Industrial Plaza, 9 Kai Cheung Road, Kowloon
	Bay, Kowloon, Hong Kong on 15th November, 2002 at 3:30 p.m.
	(or so soon thereafter as the AGM shall have been concluded or
	adjourned) for the purpose of considering, and if thought fit,
	approving the proposed amendments to the Bye-laws
“SGM Notice”	the notice convening the SGM set out on pages 5 to 8 of this
	circular
“Share(s)”	ordinary share(s) of HK$0.10 each in the capital of the Company
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited

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LETTER FROM THE BOARD

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SHANG HUA HOLDINGS
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SHANG HUA HOLDINGS LIMITED 上華控股有限公司[*]

(Incorporated in Bermuda with limited liability)

Directors: Executive Directors

Ms. Zhou Hongwen (Chairman) Mr. Cheng Dongsheng (Deputy Chairman) Ms. Zhou Liping (CEO)

Registered office: Cedar House 41 Cedar Avenue Hamilton HM 12 Bermuda

Mr. Sun Darui

Principal place of business:

Independent non-executive Directors

Mr. Tsang Link Carl, Brian

Mr. Shea Chun Lok, Quadrant

Room 701, 7th Floor Sino Industrial Plaza 9 Kai Cheung Road Kowloon Bay Kowloon Hong Kong

22nd October, 2002

To the Shareholders

Dear Sir or Madam,

PROPOSED AMENDMENTS TO THE BYE-LAWS

A. INTRODUCTION

The purpose of this circular is to provide you with information on the proposals to:

• (a) amend the Bye-laws to take advantage of the recent amendments to the Listing Rules to permit, subject to certain conditions, listed issuers to (i) send or otherwise make available corporate communications to holders of securities by electronic means with their prior approval and (ii) send to their shareholders a summary financial report in place of the annual report and accounts; and

• (b) amend the Bye-laws to comply with section 1.6 of Part A of Appendix 13 to the Listing Rules,

and to give you the notice of the SGM to be held on 15th November, 2002 at which resolution approving the above proposals will be considered and voted upon.

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* For identification purpose only

LETTER FROM THE BOARD

B. PROPOSED AMENDMENTS TO THE BYE-LAWS

1. Corporate Communications

Chapter 2 of the Listing Rules was amended on 15th February, 2002 to allow listed companies to send or otherwise make available corporate communications to holders of securities by electronic means with their prior approval if that is allowed under applicable laws and regulations and the listed company’s own constitutional documents.

The notice provisions in the current Bye-laws 163 to 170 provide, inter alia, that any notice or document from the Company to a member may be given by the Company to any member either personally, or by sending it through the post, or by advertisement to be published in the newspapers as more particularly described therein.

Accordingly, the Directors believe that it will be desirable for the Bye-laws to be amended to cater for corporate communications by electronic means. A special resolution to amend the Byelaws to the above effect will be proposed for the consideration and, if thought fit, approval by the Shareholders at the SGM.

2. Summary Financial Reports

Following the recent amendments to the Listing Rules, listed issuers are permitted, to the extent permitted under the applicable laws and regulations and their own constitutional documents and where the listed issuers have made adequate arrangements to ascertain the wish of their shareholders, to send to their shareholders a summary financial report which is derived from and summarises the directors’ report, annual accounts and the auditors’ report in place of the annual report and accounts.

As the existing Bye-laws do not contain provisions allowing the despatch of summary financial report, a special resolution will be proposed at the SGM to approve amendments to the Bye-laws to provide for the same.

3. Corporate Representatives

Further, in order to comply with section 1.6 of Part A of Appendix 13 to the Listing Rules, the Directors propose that amendments also be made to the Bye-laws to allow a recognised clearing house (within the meaning of section 2 of the Securities and Futures (Clearing Houses) Ordinance (Chapter 420 of the Laws of Hong Kong)) who is a member of the Company to authorise such person or persons as it thinks fit to act as its representative or representatives at any meeting of the Company or at any meeting of any class of members of the Company.

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LETTER FROM THE BOARD

C. SPECIAL GENERAL MEETING

Set out on pages 5 to 8 of this circular is a notice of the SGM to be held on 15th November, 2002 for the purpose of considering and, if thought fit, passing the special resolution to approve the amendments to the Bye-laws.

A form of proxy is enclosed herewith for use at the SGM. Whether or not you are able to attend the meeting in person, please complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the branch share registrar of the Company in Hong Kong, Tengis Limited at 4/F, Hutchison House, 10 Harcourt Road, Central, Hong Kong as soon as possible and in any event not later than forty-eight (48) hours before the time appointed for the holding of such meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting in person at the meeting or any adjourned meeting should you so desire.

D. RECOMMENDATIONS

The Board believes that the proposed amendments to the Bye-laws are in the best interests of the Company and the Shareholders as a whole. The Board recommends that the Shareholders vote in favour of the special resolution to be proposed at the SGM.

Copies of the Bye-laws are available for inspection during normal business hours at the principal place of business of the Company in Hong Kong at Room 701, 7th Floor, Sino Industrial Plaza, 9 Kai Cheung Road, Kowloon Bay, Kowloon, Hong Kong from the date of this circular up to and including the date of the SGM and at the SGM.

By Order of the Board Shang Hua Holdings Limited Zhou Liping Executive Director

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NOTICE OF SPECIAL GENERAL MEETING

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SHANG HUA HOLDINGS
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SHANG HUA HOLDINGS LIMITED 上華控股有限公司[*]

(Incorporated in Bermuda with limited liability)

NOTICE IS HEREBY GIVEN that a special general meeting of Shang Hua Holdings Limited (the “Company”) will be held at Room 701, 7th Floor, Sino Industrial Plaza, 9 Kai Cheung Road, Kowloon Bay, Kowloon, Hong Kong on 15th November, 2002 at 3:30 p.m. (or so soon thereafter as the annual general meeting of the Company convened at the same place and date at 3:00 p.m. shall have concluded or adjourned) for the purpose of considering and, if thought fit, passing the following resolution as a special resolution:

SPECIAL RESOLUTION

“ THAT the existing bye-laws of the Company be and are hereby amended in the following manner:

• (a) by inserting in the definition of “in writing” or “written” in bye-law 1 after the words “lithography and other means of representing or reproducing words or figures in a visible form” the words “, including representation which takes the form of electronic display, provided that both the mode of service of the relevant document or notice and the member’s election comply with all applicable Statutes, rules and regulations”;

• (b) by inserting the following new bye-law 2(D) immediately after the existing bye-law 2(C):

• “(D) References to a document being executed include references to it being executed under hand or under seal or by electronic signature or by any other method and references to a notice or document include a notice or document recorded or stored in any digital, electronic, electrical, magnetic or other retrievable form or medium and information in visible form whether having physical substance or not.”;

• (c) by inserting in bye-law 20 after the words “by notice to be published in the newspapers “ the words “or by any means in such manner as may be accepted by the Designated Stock Exchange”;

• (d) by inserting in bye-law 46 after the words “may on giving 14 days’ notice and published in the newspapers” the words “or by any means in such manner as may be accepted by the Designated Stock Exchange”;

* For identification purpose only

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NOTICE OF SPECIAL GENERAL MEETING

• (e) by inserting the following new bye-law 86A immediately after the existing bye-law 86:

• “86A. If a clearing house (or its nominee(s)), being a corporation, is a member, it may authorise such person(s) as it thinks fit to act as its representative(s) at any meeting of the Company or at any meeting of any class of members provided that the authorisation shall specify the number and class of shares in respect of which each such representative is so authorised. Each person so authorised under the provisions of this Bye-Law shall be entitled to exercise the same rights and powers on behalf of the clearing house (or its nominee(s)) as if such person was the registered holder of the shares of the Company held by the clearing house (or its nominee(s)) in respect of the number and class of shares specified in the relevant authorisation including the right to vote individually on a show of hands.”;

• (f) by inserting in bye-law 158 after the words “subject to those provisions” on the second line the words “and Bye-Law 158A”;

• (g) by inserting the following new bye-law 158A immediately after the existing bye-law 158:

• “158A. To the extent permitted by and subject to due compliance with all applicable Statutes, rules and regulations, including, without limitation, the rules of the Designated Stock Exchange, and to obtaining all necessary consents, if any, required thereunder, the requirements of Bye-Law 158 shall be deemed satisfied in relation to any person by sending to the person in any manner not prohibited by the Statutes, a summary financial statement derived from the Company’s annual accounts and the Directors’ report which shall be in the form and containing the information required by applicable laws and regulations, provided that any person who is otherwise entitled to the annual financial statements of the Company and the Directors’ report thereon may, if he so requires by notice in writing served on the Company, demand that the Company sends to him, in addition to a summary financial statement, a complete printed copy of the Company’s annual financial statement and the Directors’ report thereon.”;

• (h) by inserting the following new bye-law 158B immediately after the new bye-law 158A:

• “158B. The requirement to send to a person referred to in Bye-Law 158 the documents referred to in that provision or a summary financial report in accordance with Bye-Law 158A shall be deemed satisfied where, in accordance with all applicable Statutes, rules and regulations, including, without limitation, the rules of the Designated Stock Exchange, the Company publishes copies of the documents referred to in Bye-Law 158 and, if applicable, a summary financial report complying with Bye-Law 158A, on the Company’s computer network or in any other permitted manner (including by sending any form of electronic communication), and that person has agreed or is deemed to have agreed to treat the publication or receipt of such documents in such manner as discharging the Company’s obligation to send to him a copy of such documents.”;

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NOTICE OF SPECIAL GENERAL MEETING

• (i) by deleting the existing bye-law 163 and substituting the following new bye-law 163 in place thereof:

• “163. Any notice or document (including any “corporate communication” within the meaning ascribed thereto under the rules of the Designated Stock Exchange), whether or not, to be given or issued under these Bye-Laws from the Company to a member shall be in writing or by cable, telex or facsimile transmission message or other form of electronic transmission or communication and any such notice and document may be served or delivered by the Company on or to any member either personally or by sending it through the post in a prepaid envelope addressed to such member at his registered address as appearing in the register or at any other address supplied by him to the Company for the purpose or, as the case may be, by transmitting it to any such address or transmitting it to any telex or facsimile transmission number or electronic number or address or website supplied by him to the Company for the giving of notice to him or which the person transmitting the notice reasonably and bona fide believes at the relevant time will result in the notice being duly received by the member or may also be served by advertisement published in the newspapers in accordance with the requirements of the Designated Stock Exchange or, to the extent permitted by the applicable laws, by placing it on the Company’s website and giving to the member a notice stating that the notice or other document is available there (a “notice of availability”). The notice of availability may be given to the member by any of the means set out above. In the case of joint holders of a share all notices shall be given to that one of the joint holders whose name stands first in the register and notice so given shall be deemed a sufficient service on or delivery to all the joint holders.”; and

• (j) by deleting the existing bye-law 164 and substituting the following new bye-law 164 in place thereof:

• “164. Any notice or other document:

  • (a) if served or delivered by post, shall where appropriate be sent by airmail and shall be deemed to have been served or delivered on the day following that on which the envelope containing the same, properly prepaid and addressed, is put into the post; in proving such service or delivery it shall be sufficient to prove that the envelope or wrapper containing the notice or document was properly addressed and put into the post and a certificate in writing signed by the secretary or other officer of the Company or other person appointed by the Directors that the envelope or wrapper containing the notice or other document was so addressed and put into the post shall be conclusive evidence thereof;

  • (b) if sent by electronic communication, shall be deemed to be given on the day on which it is transmitted from the server of the Company or its agent. A notice placed on the Company’s website is deemed given by the Company to a member on the day following that on which a notice of availability is deemed served on the member;

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NOTICE OF SPECIAL GENERAL MEETING

• (c) if served or delivered in any other manner contemplated by these ByeLaws, shall be deemed to have been served or delivered at the time of personal service or delivery or, as the case may be, at the time of the relevant despatch, transmission or publication; and in proving such service or delivery a certificate in writing signed by the secretary or other officer of the Company or other person appointed by the Directors as to the fact and time of such service, delivery, despatch, transmission or publication shall be conclusive evidence thereof; and

• (d) may be given to a member either in the English language or the Chinese language, subject to due compliance with all applicable Statutes, rules and regulations.”.

By Order of the Board Shang Hua Holdings Limited Zhou Liping Executive Director

Hong Kong, 22nd October, 2002

Registered office: Principal place of business: Cedar House Room 701, 7th Floor 41 Cedar Avenue Sino Industrial Plaza Hamilton HM 12 9 Kai Cheung Road Bermuda Kowloon Bay Kowloon Hong Kong

Notes:

1. A member of the Company entitled to attend and vote at the meeting is entitled to appoint not more than two proxies to attend and vote in his stead. A proxy need not be a member of the Company.

2. A form of proxy in respect of the meeting is enclosed. Whether or not you intend to attend the meeting in person, you are urged to complete and return the proxy form in accordance with the instructions printed thereon.

3. In order to be valid, the proxy form together with a power of attorney or other authority, if any, under which it is signed, or a certified copy of such power or authority must be deposited with the branch share registrar of the Company in Hong Kong, Tengis Limited at 4/F, Hutchison House, 10 Harcourt Road, Central, Hong Kong, not less than forty-eight (48) hours before the time appointed for the holding of the meeting or any adjournment thereof.

4. Where there are joint holders of a share of the Company, any one of such holders may vote at the meeting either personally or by proxy in respect of such share as if he were solely entitled thereto, but if more than one of such holders are present at the meeting personally or by proxy, that one of such holders so present whose name stands first on the register of members of the Company in respect of such share shall alone be entitled to vote in respect thereof.

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