Cathay Pacific Airways Limited — Proxy Solicitation & Information Statement 2004

Jun 21, 2004

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 stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold all your shares in IDT International Limited, you should at once hand this circular to the purchaser or to 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.

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IDT INTERNATIONAL LIMITED

(Incorporated in Bermuda with limited liability)

(stock code 167)

PROPOSALS FOR GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES AND

AMENDMENTS TO THE BYE-LAWS OF THE COMPANY AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening an annual general meeting of IDT International Limited to be held at 2:30 p.m. on Wednesday, August 18, 2004 at the Harcourt Room, Lower Lobby, Conrad Hong Kong, Pacific Place, 88 Queensway, Hong Kong is set out on pages 14 to 30 of this circular. Whether or not you are able to attend the annual general meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the Company’s principal place of business at Block C, 9th Floor, Kaiser Estate, 41 Man Yue Street, Hunghom, Kowloon, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for holding the annual general meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the annual general meeting or any adjournment thereof, should you so wish.

June 21, 2004

LETTER FROM THE BOARD

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IDT INTERNATIONAL LIMITED

(Incorporated in Bermuda with limited liability)

(stock code 167)

Executive Directors: Raymond Chan, Chairman & Chief Executive Officer Alain Jacques Gilbert Li, Chief Financial Officer Chan Pau Shiu Yeng, Shirley Shigenobu Morita Giuseppe Finocchiaro

Registered Office: Clarendon House Church Street Hamilton HM 11 Bermuda

Non-Executive Directors: Jack William Edouard Heuer Lo Kai Yiu, Anthony# Kao Ying Lun# Jack Schmuckli# Kenichi Ohmae# Woo Chia Wei

Principal Place of Business: Block C, 9th Floor Kaiser Estate 41 Man Yue Street Hunghom, Kowloon Hong Kong

# Independent Non-Executive Director

June 21, 2004

To the Shareholders,

Dear Sir or Madam,

PROPOSALS FOR GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES AND AMENDMENTS TO THE BYE-LAWS OF THE COMPANY

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 and special resolutions to be proposed at the forthcoming annual general meeting (“2004 AGM”) of IDT International Limited (the “Company”) to be held on August 18, 2004 for the purpose of considering and if thought fit, passing resolutions to approve the renewal of the general mandates granted to the directors of the Company (“Directors”) to issue and repurchase shares of HK$0.10 each (“Shares”) in the capital of the Company and the proposed amendments to the bye-laws (“Bye-Laws”) of the Company.

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LETTER FROM THE BOARD

GENERAL MANDATE TO ISSUE AND REPURCHASE SHARES

At the last annual general meeting of the Company held on August 28, 2003, ordinary resolutions were passed to renew the general mandates granted to the Directors (i) to allot, issue and deal with Shares not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company in issue on August 28, 2003 and the nominal amount (up to a maximum of 10% of the aggregate nominal amount of the Company’s then issued share capital) of any Shares repurchased by the Company; and (ii) to repurchase Shares up to 10% of the aggregate nominal amount of the issued share capital of the Company in issue on August 28, 2003 (“Repurchase Mandate”). These general mandates will lapse at the conclusion of the 2004 AGM. Ordinary resolutions set out as resolutions no. 5(i), 5(ii) and 5(iii) in the notice of 2004 AGM will be proposed to renew these mandates.

An explanatory statement as required by the Rules Governing the Listing of Securities (the “Listing Rules”) on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) to provide the Shareholders with all the information reasonably necessary for them to make an informed decision on the proposed resolution for the granting of the Repurchase Mandate is set out in Appendix I to this circular.

AMENDMENTS TO BYE-LAWS

On January 4, 2002, certain amendments to the Companies Ordinance came into force which permit a company to distribute to its shareholders and other entitled persons (subject to their consent) summary financial reports (“Summary Financial Report”) which is derived from and summarises the complete annual report and accounts (each, a “Long Form Report”) in lieu of the relevant financial documents. The new provisions further permit a company to publish the Long Form Report and the Summary Financial Report on the company’s website in lieu of sending printed copies of those documents, subject to the consent of the relevant recipients. Following the aforesaid amendments to the Companies Ordinance, the Stock Exchange announced amendments to the Listing Rules to permit a listed issuer to (i) distribute Summary Financial Report in place of the Long Form Report, provided that it has ascertained the wishes of its shareholders and complies with the relevant legal requirements of the jurisdiction of its incorporation and the provisions of its constitutional documents; (ii) send or otherwise make available corporate communications to its shareholders using electronic means with their prior approval if this would be allowed under applicable laws and regulations and the listed issuer’s own constitutional documents; and (iii) send corporate communications to shareholders either in the English language only, or the Chinese language only, or both the English and Chinese languages in each case (in accordance with the stated wish of each shareholder and securities holder).

The Stock Exchange had on January 30, 2004 announced amendments to Appendix 3 of the Listing Rules to require articles of association or equivalent document of a listed issuer to conform with various provisions, inter alia, (i) a restriction on the voting power of a director on resolutions in relation to contracts or arrangements or proposals in which the director or his/her associate(s) has a material interest; (ii) a restriction on the voting power of a shareholder on resolutions which he/she is required to abstain from voting or restricted to voting only for or only against such resolutions under the Listing Rules; and

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LETTER FROM THE BOARD

(iii) a provision which states that the period for lodgement of notice for nomination of a director and notice of willingness to be elected from the proposed director will commence no earlier than the day after the dispatch of the notice of the shareholders’ meeting appointed for the election of the director and end no later than seven days prior to the date of such meeting. The Stock Exchange has also announced amendments to the definition of “associate” in the Listing Rules. All of these amendments to the Listing Rules came into effect on March 31, 2004. In order to bring the Bye-Laws in line with the changes brought about by the amendments to the Listing Rules, the Directors propose a special resolution at the 2004 AGM to seek the Shareholders’ approval of the amendments to the Bye-Laws of the Company.

An explanatory statement summarising the more significant changes to be effected by the proposed amendments to the Bye-Laws is set out in Appendix II to this circular.

The full text of the proposed amendments to the Bye-Laws is set out in the proposed special resolution contained in resolution no. 6 of the notice of the 2004 AGM on pages 14 to 30 of this circular.

RE-ELECTION OF DIRECTORS

According to the existing Bye-Law 97, one-third of the Directors, if their number is not three or a multiple of three, the number nearest to one-third shall retire from office (except the Chairman and the Managing Director of the Company) by rotation at every annual general meeting of the Company. The Directors to retire in every year shall be those who have been longest in office since their last election but as between persons who became Directors on the same day those to retire shall (unless they otherwise agree between themselves) be determined by lot. A retiring Director shall be eligible for re-election. Mrs. Chan Pau Shiu Yeng, Shirley and Dr. Kenichi Ohmae, who have been longest in office since their last election in 2001, and Mr. Shigenobu Morita, who is among the second longest in office chosen by lot, shall retire at the 2004 AGM.

In accordance with the Bye-Law 89, the Directors may appoint any person to be a Director as an additional Director or to fill a casual vacancy. Any person so appointed shall hold office only until the next following annual general meeting and shall be eligible for re-election. Mr. Giuseppe Finocchiaro, who was appointed as an additional Director by Directors during the year, shall retire at the 2004 AGM.

Being eligible, each of Mrs. Chan Pau Shiu Yeng, Shirley, Dr. Kenichi Ohmae and Mr. Giuseppe Finocchiaro will offer herself/himself for re-election at the 2004 AGM. Ordinary resolutions will be proposed to re-elect each of them as Director at the 2004 AGM. Mr. Shigenobu Morita, though being eligible, does not offer himself for re-election and shall retire as director at the close of the 2004 AGM.

Biographical details in respect of Mrs. Chan Pau Shiu Yeng, Shirley, Dr. Kenichi Ohmae and Mr. Giuseppe Finocchiaro are set out in Appendix III to this circular.

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LETTER FROM THE BOARD

2004 AGM

The notice convening the 2004 AGM to be held at the Harcourt Room, Lower Lobby, Conrad Hong Kong, Pacific Place, 88 Queensway, Hong Kong on August 18, 2004 at 2:30 p.m. is set out on pages 14 to 30 of this circular.

The Register of Members of the Company will be closed from Monday, August 16, 2004 to Wednesday, August 18, 2004, both days inclusive, during which period no transfer of shares will be registered. In order to be eligible to attend and vote at the 2004 AGM of the Company, all transfers accompanied by the relevant share certificates must be lodged with the Company’s Hong Kong Share Registrar, Secretaries Limited, at Ground Floor, BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong, not later than 4:00 p.m. on Friday, August 13, 2004.

According to existing Bye-Laws 67 and 68, at any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded by:

• (i) the chairman;

• (ii) at least three members present in person or by proxy or representative for the time being entitled to vote at the meeting;

• (iii) any member or members present in person or by proxy or representative and representing not less than one-tenth of the total voting rights of all the members having the right to vote at the meeting; or

• (iv) a member or members present in person or by proxy or representative 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.

Unless a poll is so demanded and the demand is not withdrawn, a declaration by the chairman that a resolution has, on a show of hands, been carried or carried unanimously or by a particular majority or lost and an entry to that effect in the book of proceedings of the Company shall be conclusive evidence of the fact, without proof of the number or proportion of the votes recorded in favour of or against that resolution.

If a poll is duly demanded it shall (subject as provided in Bye-Law 71) be taken in such manner (including the use of ballot or voting papers or tickets or scrutineers) and at such time and place, not being more than 30 days from the date of the meeting or adjourned meeting at which the poll was demanded, as the chairman directs and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded. No notice need be given of a poll not taken immediately. The demand for poll may be withdrawn with the consent of the chairman at any time before the close of the meeting or the taking of the poll, whichever is the earlier.

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LETTER FROM THE BOARD

RECOMMENDATION

The Directors consider that the granting of the general mandates to issue and repurchase Shares and the amendments to the Bye-Laws of the Company are in the interests of the Company and recommend Shareholders to vote in favour of the resolutions to approve the same at the 2004 AGM.

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully, Dr. Raymond Chan Chairman and Chief Executive Officer

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APPENDIX I

EXPLANATORY STATEMENT FOR REPURCHASE MANDATE

The following serves as an explanatory statement in compliance with the Listing Rules to give all the information reasonably necessary to enable Shareholders to make an informed decision on whether to vote for or against the resolution to approve the Repurchase Mandate.

1. Share Capital

As at June 17, 2004, the latest practicable date prior to the printing of this circular (“Latest Practicable Date”), the issued share capital of the Company was HK$208,419,990.7 comprising 2,084,199,907 Shares. In addition, as at such date, there were also outstanding options (“Options”) granted under the share option scheme of the Company carrying the rights to subscribe for 6,327,000 Shares.

Subject to the passing of the relevant ordinary resolution to approve the Repurchase Mandate (as set out in resolution no. 5(ii) of the notice of the 2004 AGM) and on the basis that no further Shares are issued or repurchased and no subscription rights of the Options are exercised prior to the 2004 AGM, exercise in full of the Repurchase Mandate would result in the repurchase by the Company of a maximum of 208,419,990 Shares during the period ending on the earliest of the date of the next annual general meeting following the 2004 AGM, the date by which the next annual general meeting following the 2004 AGM of the Company is required by the Bye-Laws of the Company or any applicable laws of Bermuda to be held or the date upon which such authority is revoked or varied by an ordinary resolution of the Shareholders in general meeting.

2. Reasons for Repurchases

The Directors have no present intention to repurchase any Shares but consider that the Repurchase Mandate is in the best interests of the Company and the Shareholders. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net assets and/or earnings per share of the Company and will only be made when the Directors believe that such repurchases will benefit the Company and the Shareholders.

As compared with the financial position of the Company as at March 31, 2004 (being the date to which the latest audited financial statements of the Company were made up), there will not be material adverse impact on the working capital or gearing position of the Company in the event that the Repurchase Mandate is carried out in full during the proposed repurchase period. The Directors do not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or the gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

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APPENDIX I

EXPLANATORY STATEMENT FOR REPURCHASE MANDATE

3. Funding of Repurchases

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with its Memorandum of Association and Bye-Laws and all applicable laws of Bermuda.

4. Market Prices

The highest and lowest prices at which the Shares have been traded on the Stock Exchange in each of the twelve months from June 1, 2003 to May 31, 2004 were as follows:

	Highest Per Share	Lowest Per Share
	HK$	HK$
2003
June	0.93	0.83
July	0.99	0.91
August	1.09	0.95
September	1.21	1.03
October	1.16	1.06
November	1.20	1.08
December	1.29	1.17
2004
January	1.42	1.23
February	1.82	1.33
March	1.90	1.64
April	1.96	1.74
May	1.89	1.33

5. Directors, their Associates and Connected Person

None of the Directors nor, to the best of their knowledge and having made all reasonable enquiries, any of their respective associates, have any present intention to sell any Shares to the Company or its subsidiaries under the Repurchase Mandate in the event that such mandate is approved by Shareholders.

No connected person, as defined in the Listing Rules, has notified the Company that he/she has a present intention to sell any Shares to the Company, nor has he/she undertaken not to do so in the event that the Repurchase Mandate is approved by Shareholders.

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APPENDIX I

EXPLANATORY STATEMENT FOR REPURCHASE MANDATE

6. Undertaking of the Directors

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the Repurchase Mandate in accordance with the Listing Rules, all applicable laws of Bermuda and in accordance with the Memorandum of Association and Bye-Laws of the Company.

7. Effect of Takeovers Code

If on the exercise of the power 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 Rule 32 of the Hong Kong Code on Takeovers and Mergers (“Takeovers Code”). As a result, a Shareholder or a group of Shareholders acting in concert (within the meaning of the Takeovers Code) could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code for all Shares not already owned by such Shareholder or group of Shareholders.

As at the Latest Practicable Date, Dr. Raymond Chan and Mrs. Chan Pau Shiu Yeng, Shirley (the spouse of Dr. Raymond Chan) together with their associates were interested in Shares representing approximately 55% of the issued share capital of the Company. To the best of the knowledge and belief of the Company, Dr. Raymond Chan and Mrs. Chan Pau Shiu Yeng, Shirley together with their associates are the only substantial Shareholders of the Company. On the basis that no further Shares are issued or repurchased and in the event that the Directors exercise in full the power to repurchase Shares which is proposed to be granted pursuant to the Repurchase Mandate, the shareholding of Dr. Raymond Chan and Mrs. Chan Pau Shiu Yeng, Shirley together with their associates in the Company would be increased to approximately 61% 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 Rule 26 of the Takeovers Code.

8. Shares Repurchases Made by the Company

The Company had not repurchased any Shares (whether on the Stock Exchange or otherwise) in the six months preceding the Latest Practicable Date.

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APPENDIX II EXPLANATORY STATEMENTS FOR THE PROPOSED AMENDMENTS TO BYE-LAWS OF THE COMPANY

The following is a summary of the more significant changes to be effected by the proposed amendments to the Bye-Laws:

1. Bye-Law 1

To add new definitions and to change the existing definitions in order to be in line with the amended Listing Rules and Securities and Futures Ordinance (“SFO”) and to extend the construction of expressions referring to writing to include representations made in electronic means.

2. Bye-Law 18

The purpose of the amendment is to expressly provide that notice of call may be published in newspapers or given by electronic means.

3. Bye-Law 39

The purpose of the amendment is to expressly provide that the instrument of transfer of any shares can be executed with a manual signature or facsimile signature (which may be machine imprinted or otherwise) on behalf of the transferor and transferee.

4. Bye-Law 42

To reflect the existing practices regarding registration of transfer of shares.

5. Bye-Law 44

To expressly allow announcement of suspension of registration of transfer be made by any means as may be accepted under the Listing Rules.

6. Bye-Laws 67 and 68

The purpose of the amendment is to reflect the requirement of voting by poll under the circumstances set out in the amended Listing Rules.

7. Bye-Law 76(B)

To reflect the restriction on voting by shareholders whom the Company has knowledge as required by the amended Appendix 3 of the Listing Rules.

8. Bye-Law 84(B)

If the Clearing House (or its nominee) is a shareholder of the Company, it may appoint such person or persons to act as its corporate representative or representatives at any general meeting of the Company.

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APPENDIX II

EXPLANATORY STATEMENTS FOR THE PROPOSED AMENDMENTS TO BYE-LAWS OF THE COMPANY

9. Bye-Law 87

The purpose of the amendment is to provide expressly that the minimum length of the period during which notice of nomination of a director and notice of willingness to be elected from the proposed director may be given will be at least 7 days and that the period for lodgment of such notices will commence on the day after the despatch of the notice of the relevant general meeting and end no later than 7 days prior to the date of that meeting.

10. Bye-Law 97

To amend the existing wordings of Bye-Law 97 to provide that all Directors, including chairman and managing director, shall be subject to retirement by rotation.

11. Bye-Law 109(C)

A Director shall declare the nature of his interests in a contract or arrangement or proposed contract or arrangement with the Company at the meeting of the Board at which the question of entering into the contact or arrangement is first taken into consideration.

12. Bye-Law 109(D)

This new Bye-Law 109(D) requires that any proposal concerning the appointment of two or more Directors shall be divided and considered in relation to each Director separately so that each of the Directors shall be entitled to vote on each resolution except that concerning his own appointment.

13. Bye-Laws 109(F) to 109(H)

To be consistent with the provisions of the amended Appendix 3 of the Listing Rules so that subject to certain exceptions, a Director shall abstain from voting at the board meeting on any contract or arrangement or proposal in which he or any of his associates has a material interest nor shall he be counted in the quorum of the relevant board meeting.

14. Bye-Laws 154(B)

To reflect the change on the requirement regarding financial report in light of the amended Listing Rules.

15. Bye-Laws 155(A) to 155(C)

To allow the Company to distribute summary financial reports in place of a full annual report in light of the amended Listing Rules and to permit the Company to send summary financial reports to shareholders by electronic means.

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APPENDIX II

EXPLANATORY STATEMENTS FOR THE PROPOSED AMENDMENTS TO BYE-LAWS OF THE COMPANY

16. Bye-Law 160

To permit the Company to send notices or otherwise make available corporate communications, to shareholders in person, by post, by telex or facsimile transmission, by electronic communication, by press advertisement or by placing it on the Company’s website.

17. Bye-Law 161

To add provision for deemed services of notice or other document delivered by post, sent by electronic communication or published on the Company’s website and to add provision to allow such notice and document to be given to shareholders in either the English or Chinese language.

18. Bye-Law 169 (B)

To add provision in relation to the Directors’ power to destroy certain documents as permitted by applicable laws.

19. Bye-Law 174

To permit the Company to purchase liability insurance for Directors or other officers or auditors of the Company.

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APPENDIX III BIOGRAPHY OF DIRECTORS PROPOSED TO BE RE-ELECTED AT THE ANNUAL GENERAL MEETING

The biography of the Directors who will retire from office by rotation at the 2004 AGM and being eligible, will offer themselves for re-election at the 2004 AGM, are set out below:

Chan Pau Shiu Yeng, Shirley

Executive Director, aged 55. Mrs. Chan is the spouse of Dr. Raymond Chan, the Chairman, the Chief Executive Officer and a substantial shareholder of the Company. As a co-founder, she has been involved in developing the IDT business since 1977. She was appointed as a Director of the Company in July 1990. Mrs. Chan contributes towards the Group by setting the marketing strategies and increasing efficiency of operations. Her main responsibilities are to support the marketing activities and administrative functions of the Group. She is also an Executive Director of the Singapore listed subsidiary, IDT Holdings (Singapore) Limited. Mrs. Chan holds a Diploma in Legal Studies from the University of Hong Kong and a MBA degree from the University of Hull, UK. As at the Latest Practicable Date, Mrs. Chan has personal and corporate interest in 243,956,920 shares of the Company within the meaning of Part XV of the SFO. Save as disclosed above, Mrs. Chan does not have any relationship with any directors, senior management, substantial or controlling shareholders of the Company. Mrs. Chan has entered into a service contract with the Company with no fixed term and shall continue unless and until terminated by either the Company or Mrs. Chan by giving the other not less than 6 months’ prior notice. She is entitled to an annual remuneration, a discretionary bonus and other benefits from time to time to be reviewed and determined by the Board with reference to her experience and the remuneration benchmark in the industry, the Company’s performance and the prevailing market conditions. During the financial year ended March 31, 2004, she was paid total salaries and other benefits of HK$2,137,989 and will entitle to receive director’s fees of approximately HK$142,972 and a bonus of HK$2,700,000.

Kenichi Ohmae

Independent Non-Executive Director, aged 61. Dr. Ohmae was appointed in August 2001. He is a world renowned management consultant and was selected as one of the five management gurus in the world by The Economist in 1994. Dr. Ohmae received his Ph.D. in nuclear engineering from the Massachusetts Institute of Technology and an honorary doctorate from Notre Dame University. He is an expert in formulating creative strategies and developing organisational concepts for both the private and public sectors. He is the founder and Managing Director of the Ohmae & Associates and before that, had been a partner of McKinsey & Company, Inc., an international management consulting firm, for 23 years. Dr. Ohmae does not have any interests or short positions in any shares, underlying shares or debentures of the Company and its associated corporations within the meaning of Part XV of the SFO. Other than the relationship arising from his being an independent non-executive Director. Dr. Ohmae does not have any relationships with any other directors, chief executive, substantial shareholders of the Company or an associate of any of them. There is no service contract between the Company and Dr. Ohmae. A director’s fee of HK$200,000 will be paid to Dr. Ohmae for the financial year ended March 31, 2004 which is determined by the Board with reference to the remuneration benchmark in the market for independent non-executive director of other companies listed on the Stock Exchange.

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APPENDIX III

BIOGRAPHY OF DIRECTORS PROPOSED TO BE RE-ELECTED AT THE ANNUAL GENERAL MEETING

Giuseppe Finocchiaro

Executive Director, aged 47. Mr. Finocchiaro joined the Group in 1993 and was appointed Executive Director of the Company in October 2003. In addition, he is the Managing Director of Oregon Scientific Italia S.p.A incorporated in Italy and Managing Director of Oregon Scientific (Deutschland) GmbH and Huger Electronics GmbH, both incorporated in Germany and is also responsible for managing the Group’s business operations in EMEA (Europe, Middle East and Africa). Mr. Finocchiaro holds an electronic diploma, and has over 26 years of experience in electronic business. Prior to joining the Group, he spent 15 years at Texas Instruments. As at the Latest Practicable Date, Mr. Finocchiaro was granted 1,000,000 share options to subscribe Shares of the Company at HK$0.798 per Share exercisable within the period from March 1, 2005 to February 27, 2013. He was also granted 200,000 share options of IDT Holdings (Singapore) Limited (“IDTS”), a subsidiary of the Company having its shares listed on the Singapore Exchange Securities Trading Limited, to subscribe shares of IDTS at S$2.149 per share exercisable within the period from August 15, 2002 to August 12, 2005. Other than the relationship arising from his being an executive director, Mr. Finocchiaro does not have any relationship with any other directors, senior management, substantial or controlling shareholders of the Company. There is no service contract between the Company and Mr. Finocchiaro. However, he has a service contract with a subsidiary of the Company. During the financial year ended March 31, 2004, he was paid total salaries and other benefits of approximately HK$2,953,421 and will entitle to receive a director’s fee of HK$23,288 and a bonus of approximately HK$790,723. His total emoluments are determined with reference to his performance, the prevailing market conditions, the remuneration benchmark in the industry and the Company’s performance.

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NOTICE OF ANNUAL GENERAL MEETING

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IDT INTERNATIONAL LIMITED

(Incorporated in Bermuda with limited liability)

(stock code 167)

NOTICE IS HEREBY GIVEN that the annual general meeting of the Company will be held at the Harcourt Room, Lower Lobby, Conrad Hong Kong, Pacific Place, 88 Queensway, Hong Kong on Wednesday, August 18, 2004 at 2:30 p.m. for the following purposes:

1. To receive and consider the audited financial statements and the reports of the directors and auditors for the year ended March 31, 2004.

2. To declare a final dividend for the year ended March 31, 2004.

3. To re-elect directors and fix the remuneration of directors.

4. To appoint auditors and authorise the directors to fix their remuneration.

5. As special business, to consider and, if thought fit, pass the following resolutions as ordinary resolutions of the Company with or without modifications:

6. (i) “ THAT :

   • (a) subject to paragraph (c) of this resolution, the exercise by the directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant offers, agreements, options and warrants carrying the right to subscribe for shares, which would or might require the exercise of such powers, subject to and in accordance with all applicable laws, be and is hereby generally and unconditionally approved;

   • (b) the approval in paragraph (a) of this resolution shall authorise the directors during the Relevant Period to make or grant offers, agreements, options and warrants carrying the right to subscribe for shares, which would or might require the exercise of such powers after the end of the Relevant Period;

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NOTICE OF ANNUAL GENERAL MEETING

• (c) the aggregate nominal amount of 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) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); or (ii) any Share Option Scheme (as hereinafter defined) of the Company; or (iii) any scrip dividend or other similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares of the Company in accordance with the Bye-Laws of the Company, shall not exceed the sum of 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution, and the said approval shall be limited accordingly; and

• (d) 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 its Bye-Laws or any applicable laws of Bermuda to be held; and

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

“Rights Issue” means an offer of shares open for a period fixed by the directors to holders of shares of the Company appearing on its register of members on a fixed record date in proportion to their then holdings of such shares (subject to such exclusions 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 any relevant jurisdiction or the requirements of any recognised regulatory body or any stock exchange in any territory outside Hong Kong); and

“Share Option Scheme” means a share option scheme or similar arrangement for the time being, as varied from time to time, adopted for the grant or issue to executive directors and employees of the Company and its subsidiaries of rights to acquire shares of the Company.”

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NOTICE OF ANNUAL GENERAL MEETING

• (ii) “ THAT :

• (a) subject to paragraph (b) of this resolution, the exercise by the directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to purchase issued shares in the capital of the Company subject to and in accordance with all applicable laws and the requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended from time to time, be and is hereby generally and unconditionally approved;

• (b) the aggregate nominal amount of the share capital of the Company to be purchased or agreed conditionally or unconditionally to be purchased by the directors pursuant to the approval in paragraph (a) of this resolution during the Relevant Period shall not exceed 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution, and the said approval shall be limited accordingly; and

• (c) 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 its Bye-Laws or any applicable laws of Bermuda to be held; and

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

• (iii) “ THAT the exercise by the directors of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company in accordance with the general mandate granted pursuant to resolution numbered 5(i) set out in the notice convening this meeting be and is hereby extended by the addition thereto of an amount representing the aggregate nominal amount of shares of the Company purchased by the Company under the authority granted pursuant to resolution numbered 5(ii) set out in the notice convening this meeting provided that such amount shall not exceed 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution.”

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1. As special business, to consider and, if thought fit, pass the following resolution as a special resolution with or without modifications:

“ THAT the Bye-Laws (the “Bye-Laws”) of the Company be and are hereby amended in the following manner:–

• (a) Bye-Law 1(A)

• (i) by inserting the following new definitions in existing Bye-Law 1(A):

“address” have the ordinary meaning given to it and includes any facsimile number, electronic number or address or website used for the purposes of any communication pursuant to these Bye-Laws.

• “associate” the meaning attributed to it in the rules of the Designated Stock Exchange.

• “Board” the board of Directors.

• “Clearing House” a recognised clearing house within the meaning of Part I of Schedule 1 to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) or a clearing house or authorised share depository recognised by the laws of the jurisdiction in which the shares of the Company are listed or quoted on a stock exchange in such jurisdiction.

“Companies the Companies Ordinance (Chapter 32 of Ordinance” the Laws of Hong Kong), as from time to time supplemented, amended, substituted or replaced.

“electronic” relates to the technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities and such other meanings as given to it in the Electronic Transactions Act 1999 of Bermuda as may be amended from time to time. “electronic a communication sent by electronic communication” transmission in any form through any medium.

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“Hong Kong” The Hong Kong Special Administrative Region of the People’s Republic of China. “subsidiaries” shall have the same meaning ascribed thereto under Rule 1.01 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (as may be amended from time to time).

• “Summary Financial the summary financial report which is Report” derived from and summarises the complete annual Directors’ report and the Auditors’ report and as defined in the Companies Ordinance.

• (ii) By deleting the existing definition of “member” in Bye-Law 1(A) and replacing it with the following:–

• “members/ “shareholders” or “members” shall mean shareholders” the persons who are duly registered as the holders from time to time of shares in the register including persons who are jointly so registered.

• (iii) By deleting the existing definition of “the Director” in Bye-Law 1 (A) and replacing therewith the following:–

• “Director” means a director of the Company and “the Directors” means the board of Directors of the Company as constituted from time to time or the Directors present at a meeting of Directors at which a quorum is present, and references in the Bye-Laws to Directors shall be to both executive and non-executive Directors unless otherwise indicated.

• (iv) by deleting the existing definition of “in writing” or “written” in Bye-Law 1(A) and replacing therewith the following:–

• “in writing” or “written” shall, unless the contrary intention appears, be construed as including printing, lithography, xerography, photography or other modes of representing or reproducing words or figures in a permanent visible form or, to the extent permitted by and in accordance with all applicable Statutes, rules and regulations, any visible substitute for writing (including an electronic communication), or modes of representing

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or reproducing words or figures partly in one visible form and partly in another visible form, and including where the representation 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.

• (v) By adding the following paragraph as new Bye-Law 1(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.”

• (b) by deleting the existing Bye-Law 18 in its entirety and replacing therewith the following new Bye-Law 18:

• “18. In addition to the giving of notice in accordance with Bye-Law 16, notice of the person appointed to receive payment of every call and of the times and places appointed for payment may be given to the members affected by notice published in newspapers published daily and circulating generally in the territory of and in accordance with the requirements of the Designated Stock Exchange or, subject to the rules of the Designated Stock Exchange, by electronic communication in the manner in which notices may be served by the Company by electronic means as provided for in these Bye-Laws.”

• (c) by deleting the existing Bye-Laws 39(A) to 39(C) in their entirety and replacing therewith the following new Bye-Laws 39(A) and 39(B):

• “39(A) Subject to these Bye-Laws, any member may transfer all or any of his shares by an instrument of transfer in the usual or common form or in a form prescribed by the Designated Stock Exchange or in any other form approved by the Board and may be under hand, or if the transferor or transferee is a recognised clearing house or its nominee(s), by hand or by machine imprinted signature or by such other manner of execution as the Board may approve from time to time.

  • “(B) The instrument of transfer of any share shall be executed by or on behalf of the transferor and the transferee provide that the Board may dispense with the execution of the instrument of transfer by the transferee in any case which it thinks fit in its

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discretion to do so. Without prejudice to Bye-Law 39(A), the Board may also resolve, either generally or in any particular case, upon request by either the transferor or transferee, to accept mechanically executed transfers. The transferor shall be deemed to remain the holder of the share until the name of the transferee is entered in the register in respect thereof.”

• (d) by deleting the existing Bye-Law 42 in its entirety and replacing therewith the following new Bye-Law 42:

• “42. The Board may also decline to register any transfer of any shares unless:

  • (i) the instrument of transfer is lodged at the office or such other place as the Directors may appoint for registration accompanied by the certificate of the shares to which it relates (which shall upon registration of the transfer be cancelled) and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer; and

  • (ii) the instrument of transfer is in respect of only one class of shares; and

  • (iii) the instrument of transfer is properly stamped (in circumstances where stamping is required); and

  • (iv) in the case of a transfer to joint holders, the number of joint holders to which the share is to be transferred does not exceed four; and

  • (v) the shares concerned are free of any lien in favour of the Company; and

  • (vi) a fee of such maximum sum as the Designated Stock Exchange may from time to time determine to be payable (or such lesser sum as the Board may from time to time require) is paid to the Company in respect thereof.”

• (e) by deleting the existing Bye-Law 44 in its entirety and replacing therewith the following new Bye-Law 44:

• “44. The registration of transfers of shares or of any class of shares may, after notice has been given by advertisement in an appointed newspaper and, where applicable, any other newspapers in accordance with the requirements of any Designated Stock Exchange or, by any means in such manner as may be accepted by

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the Designated Stock Exchange, be suspended and the register closed at such times and for such periods as the Board may from time to time determine, provided always that such registration shall not be suspended or the register shall not be closed for more than 30 days in any year (or such longer period as the members may by ordinary resolution determine provided that such period shall not be extended beyond 60 days in any year).”

• (f) by inserting the words “or unless a poll is taken as may from time to time be required under the rules of the Designated Stock Exchange or under any other applicable laws, rules or regulations” immediately after the words “Unless a poll is so demanded and the demand is not withdrawn” in the last paragraph of Bye-Law 67.

• (g) by deleting the existing Bye-Law 68 in its entirety and replacing therewith the following new Bye-Law 68:

• “68. If a poll is duly demanded or if a poll is required to be taken under the rules of the Designated Stock Exchange or under any other applicable laws, rules or regulations, it shall (subject as provided in Bye-Law 71) be taken in such manner (including the use of ballot or voting papers or tickets or scrutineers) and at such time and place, not being more than 30 days from the date of the meeting or adjourned meeting at which the poll was demanded or was required to be taken, as the chairman directs and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded or was required to be taken. No notice need be given of a poll not taken immediately. The demand for a poll may be withdrawn with the consent of the chairman at any time before the close of the meeting or the taking of the poll, whichever is the earlier.”

• (h) by renumbering the existing Bye-Law 76 as Bye-Law 76(A) and adding the following new Bye-Law 76(B) thereafter:

• “76(B) Where the Company has knowledge that any member is, under the rules and regulations of the Designated Stock Exchange from time to time, required to abstain from voting on any particular resolution of the Company or restricted to voting only for or only against any particular resolution of the Company, any votes cast by or on behalf of such member in contravention of such requirement or restriction shall not be counted.”

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• (i) by deleting the existing Bye-Law 84(B) in its entirety and substituting therewith the following new Bye-Law 84(B):

• “84(B) If a Clearing House (or its nominee(s) and, in each case, being a corporation) is a shareholder of the Company, it may appoint such person or persons as it thinks fit to act as its corporate representative or representatives at any meeting of the Company or at any meeting of any class of shareholders of the Company provided that, if more than one corporate representative is so appointed, the appointment shall specify the number and class of shares in respect of which each such corporate representative is so appointed. A person so appointed under the provisions of this Bye-Law shall be deemed to have been duly authorised without further evidence of the facts and 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. The number of persons a Clearing House (or its nominee(s)) may appoint to act as its corporate representative or representatives shall not exceed the number of shares held by a Clearing House (or its nominee(s)), being shares in respect of which there is an entitlement to attend and vote at the relevant meeting.”

• (j) by deleting the existing Bye-Law 87 in its entirety and replacing therewith the following new Bye-Law 87:

• “87. No person, other than a retiring Director, shall, unless recommended by the Directors for election, be eligible for election to the office of Director at any general meeting, unless a notice in writing signed by a member (other than the person to be proposed) entitled to attend and vote at the meeting for which such notice is given of his intention to propose such person for election and also a notice signed by the person to be proposed of his willingness to be elected shall have been lodged at the registered office of the Company or the principal place of business of the Company in Hong Kong provided that the minimum length of the period, during which such notice(s) are given, shall be at least seven (7) days and that the period for lodgement of such notice(s) shall commence no earlier than the day after the despatch of the notice of the general meeting appointed for such election and end no later than seven (7) days prior to the date of such general meeting.”

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• (k) by deleting the existing Bye-Law 97 in its entirety and replacing therewith the following new Bye-Law 97:–

• “97. Subject to the provisions of the Statutes, at each annual general meeting one-third of the Directors for the time being, or if their number is not three or a multiple of three, the number nearest to but not less than one-third, shall retire from office. A Director retiring at a meeting shall retain office until the close of the meeting. The Directors to retire in every year shall, subject as aforesaid, be those who have been longest in office since their last election but as between persons who became Directors on the same day, those to retire shall (unless they otherwise agree between themselves) be determined by lot. The Directors to retire on each occasion (both as to number and identity) shall be determined by the composition of the Directors at the date of the notice convening the annual general meeting and no Director shall be required to retire or be relieved from retiring by reason of any change in the number and identity of the Directors after the date of such notice but before the close of the meeting. The retiring Directors shall be eligible for re-election.”

• (l) by deleting the existing Bye-Law 109(C) in its entirety and replacing therewith the following new Bye-Law 109(C):–

• “109(C) A Director who to his knowledge is in any way, whether directly or indirectly, interested in a contract or arrangement or proposed contract or arrangement with the Company shall declare the nature of his interest or the interest of any of his associate(s) at the meeting of the Board at which the question of entering into the contract or arrangement is first taken into consideration, if he knows his interest or the interest of any of his associate(s) then exists, or in any other case at the first meeting of the Board after he knows that he or any of his associate(s) is or has become so interested. For the purposes of this Bye-Law, a general notice to the Board by a Director to the effect that (a) he or any of his associate(s) is a member or officer of a specified company or firm and is to be regarded as interested in any contract or arrangement which may after the date of the notice be made with that company or firm or (b) he or any of his associate(s) is to be regarded as interested in any contract or arrangement which may after the date of the notice be made with a specified person who is connected with him, shall be deemed to be a sufficient declaration of interest under this Bye-Law in relation to any such contract or arrangement; provided that no such notice shall be effective unless either it is given at a meeting of the Board or the Director takes reasonable steps to secure that it is brought up and read at the next Board meeting after it is given.”

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• (m) by adding the following new Bye-Law 109(D) immediately after ByeLaw 109(C):

• “109(D) Where proposals are under consideration concerning the appointment (including fixing or varying the terms of or terminating the appointment) of two or more Directors to offices or employments with the Company or any company in which the Company is interested, such proposals shall be divided and considered in relation to each Director separately and in such case each of the Directors (if not prohibited from voting under these Bye-Laws) shall be entitled to vote (and be counted in the quorum) in respect of each resolution except that concerning his own appointment.”

• (n) by renumbering the existing Bye-Laws 109(D) and 109(H) as Bye-Law 109(E) and Bye-Law 109(I) respectively and by deleting the existing ByeLaws 109(E) to 109(G) and replacing therewith the new Bye-Laws 109(F) to 109(H) respectively:

• “109(F) Save as otherwise provided by these Bye-Laws, a Director shall not vote (nor shall he be counted in the quorum) on any resolution of the Board approving any contract or arrangement or any other proposal in which he or any of his associates(s) has/have a material interest, and if he shall do so his vote shall not be counted (nor shall he be counted in the quorum for that resolution), but this prohibition shall not apply to any of the following matters namely:

  • (i) any contract or arrangement for the giving of any security or indemnity to the Director or his associate(s) in respect of money lent or obligations incurred or undertaken by him or any of his associates at the request of or for the benefit of the Company or any of its subsidiaries;

  • (ii) any contract or arrangement for the giving of any security or indemnity to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director or his associate(s) has himself/ themselves assumed responsibility in whole or in part and whether alone or jointly under a guarantee or indemnity or by the giving of security;

  • (iii) any contract or arrangement concerning an offer of shares or debentures or other securities of or by the Company or any other company which the Company may promote or be interested in for subscription or purchase, where the Director or his associate(s) is/are or is/are to be interested as a participant in the underwriting or subunderwriting of the offer;

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• (iv) any contract or arrangement in which the Director or his associate(s) is/are interested in the same manner as other holders of shares or debentures or other securities of the Company by virtue only of his/their interest in shares or debentures or other securities of the Company;

• (v) any contract, arrangement or proposal concerning any other companies in which the Director or his associate(s) is/are interested only, whether directly or indirectly, as an officer or executive or a member or in which the Director or his associate(s) is/are beneficially interested in shares of that Company, provided that the Director and/or any of his associate(s) is/are not in aggregate beneficially interested in five per cent. (5%) or more of the issued shares of any class of the equity share capital of such company or of the voting rights of any class of shares of such company (or of any third company through which his interest or that of this associate(s) is derived); and

• (vi) any proposal or arrangement concerning the adoption, modification or operation of a share option scheme, a pension fund or retirement, death or disability benefit scheme or other arrangement which relates both to the Directors, his associate(s) and employees of the Company or of any of its subsidiaries and does not provide in respect of any Director or his associate(s), as such any privilege or advantage not generally accorded to the class of persons to which such scheme or fund relates.”

• “109(G) A company shall be deemed to be a company in which a Director and/or any of his associate(s) own five per cent. (5)% or more of the issued shares of any class of the equity share capital of such company or of the voting rights of any class of shares of such company if and so long as (but only if and so long as) he and/or his associate(s) is/are (either directly or indirectly) the holder(s) of or beneficially interested in five per cent. (5)% or more of any class of the equity share capital of such company (or of any third company through which the interest of the Director or that of his associate(s) is derived) or of the voting rights of any class of shares available to members of such company. For the purpose of this Bye-Law there shall be disregarded any shares held by a Director or any of his associate(s) as bare or custodian trustee and in which he or his associate(s) has/have no beneficial interest, any shares comprised in a trust in which the interest of the Director or his associate(s) is/are in reversion or remainder if and so long as

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some other person is entitled to receive the income thereof, and any shares comprised in an authorised unit trust scheme in which the Director or any of his associate(s) is/are interested only as a unit holder and shares which carry no voting right at general meetings and very restrictive dividend and return of capital right.”

• “109(H) Where a company in which a Director and/or his associate(s) hold(s) five per cent. (5%) or more is materially interested in a transaction, then that Director and/or his associate(s) shall also be deemed materially interested in such transaction.”

• (o) by renumbering the existing Bye-Law 154 as Bye-Law 154(A) and by adding immediately thereafter the following new Bye-Law 154(B):–

• “154(B) The Board may also cause to be prepared any other financial documents (including but without limitation any Summary Financial Report) as the Board thinks fit.”

• (p) by deleting the existing Bye-Law 155 in its entirety and replacing therewith the following new Bye-Laws 155(A), 155(B) and 155(C):

• “155(A) Subject to Section 88 of the Act and Bye-Law 155(B), a printed copy of the Directors’ report, accompanied by the balance sheet and profit and loss account including every document required by law to be annexed thereto, made up to the end of the applicable financial year and containing a summary of the assets and liabilities of the Company under convenient heads and a statement of income and expenditure, together with a copy of the Auditors’ report, shall be sent to each person entitled thereto at least twenty-one (21) days before the date of the general meeting and at the same time as the notice of annual general meeting and laid before the Company in general meeting in accordance with the requirements of the Act provided that this Bye-Law shall not require a copy of those documents to be sent to any person whose address the Company is not aware of or to more than one of the joint holders of any shares or debentures.”

• “155(B) 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 155(A) 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 Report derived from the Company’s annual accounts and directors’ report which shall be in the form and containing the information

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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 Report, a complete printed copy of the Company’s annual financial statement and the directors’ report thereon.”

• “155(C) The requirement to send to a person referred to in Bye-Law 155(A) the documents referred to in that Bye-Law or a Summary Financial Report in accordance with Bye-Law 155(B) 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 155(A) and, if applicable, a Summary Financial Report complying with Bye-Law 155(B), on the Company’s website 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.”

• (q) by deleting the existing Bye-Law 160 in its entirety and replacing therewith the following new Bye-Law 160:–

• “160. 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 in appointed newspapers (as defined in the Act) or in any other newspapers published daily and circulating generally in the

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territory of and 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 or the website of the Designated Stock Exchange, and giving to the member a notice stating that the notice or other document is available there (a “Notice of Publication”). The Notice of Publication may be given to the member by any of the means set out above.”

• (r) by deleting the existing Bye-Law 161 in its entirety and replacing therewith the following new Bye-Law 161:–

• “161. 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 prepaid, addressed and put into the post and a certificate in writing signed by the secretary or other person appointed by the Board that the envelope or wrapper containing the notice and 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 have been served at the time when the notice, document or publication is transmitted electronically provided that no notification that the electronic communication has not reached its recipient has been received by the sender, except that any failure in transmission beyond the sender’s control shall not invalidate the effectiveness of the notice, document or publication being served;

  • (c) if published on the Company’s website or the website of the Designated Stock Exchange, shall be deemed to have been served on the day on which the notice, document or publication first so appears on the Company’s website or the website of the Designated Stock Exchange to which the member may have access or the day on which the Notice of Publication is deemed to have been served on such member under these Bye-Laws, whichever is later;

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  - (d) if served or delivered in person, shall be deemed to have been served or delivered at the time of personal service or delivery;

  - (e) if served by advertisement in an appointed newspaper (as defined in the Act) or in any other newspapers in accordance with the requirements of the Designated Stock Exchange, shall be deemed to have been served on the day on which the notice is first published;

  - (f) if served or delivered in any other manner contemplated by these Bye-Laws, shall be deemed to have been served or delivered 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 Board as to the fact and time of such service, delivery, depatch, transmission or publication shall be conclusive evidence thereof; and

  - (g) 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.”

• (s) by renumbering the existing Bye-Law 169 as Bye-Law 169(A) and adding thereafter the following new Bye-Law 169(B):

• “169(B) Notwithstanding any provision contained in these Bye-Laws, the Directors may, if permitted by applicable law, authorise the destruction of documents set out in sub-paragraph (i) to (iv) of Bye-Law 169(A) and any other documents in relation to share registration which have been microfilmed or electronically stored by the Company or by the share registrar on its behalf provided always that this Bye-Law shall apply only to the destruction of a document in good faith and without express notice to the Company and its share registrar that the preservation of such document was relevant to a claim.”

• (t) by adding the following new Bye-Law 174 immediately after the existing Bye-Law 173:–

• “174. The Company may purchase and maintain for any Director, or other officer or Auditors of the Company insurance against any liability to the Company or a related company in respect of any negligence, default, breach of duty or breach of trust (save for fraud or dishonesty) of which he may be guilty in relation to the Company or a related company.

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For the purpose of this Bye-Law 174, “related company” means any company which is the Company’s subsidiary or holding company or a subsidiary of the Company’s holding company.”

1. To transact any other business.

By Order of the Board of Directors Yeung Yee Har Company Secretary

Hong Kong, June 21, 2004

Notes:

• (i) The register of members of the Company will be closed from Monday, August 16, 2004 to Wednesday, August 18, 2004, both days inclusive, during which period no share transfers will be effected. To qualify for the proposed final dividend, all share transfers accompanied by the relevant share certificates must be lodged with the Company’s Hong Kong share registrar, Secretaries Limited, at G/F., BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong for registration not later than 4:00 p.m. on Friday, August 13, 2004.

• (ii) A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a member of the Company.

• (iii) To be valid, the instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed or a notarially certified copy thereof shall be deposited at the principal place of business of the Company in Hong Kong at Block C, 9/F., Kaiser Estate, 41 Man Yue Street, Hunghom, Kowloon, Hong Kong not less than forty-eight hours before the time for holding the annual general meeting or any adjourned meeting.

Note: The Chinese translation of this Circular which contains details of the amendments to the Bye-Laws is for reference only. In case of any inconsistency, the English version shall prevail.

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