CCT Fortis Holdings Limited — Proxy Solicitation & Information Statement 2003

Jul 31, 2003

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 you should take, you should consult your stockbroker or other registered dealer in securities, a bank manager, solicitor, professional accountant or other professional advisor.

If you have sold all your shares in Stelux Holdings International Limited, you should at once hand this circular and the accompanying form of proxy 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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(Incorporated in Bermuda with limited liability)

GENERAL MANDATE TO REPURCHASE SHARES

GENERAL MANDATE TO ISSUE SHARES

AND

NOTICE OF ANNUAL GENERAL MEETING

The notice of the annual general meeting of Stelux Holdings International Limited to be held at 5/F., Stelux House, 698 Prince Edward Road East, San Po Kong, Kowloon, Hong Kong on Friday, 5th September, 2003 at 11:30 a.m. is set out on pages 5 to 7. Whether or not you are able to attend the meeting, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting.

31st July, 2003

LETTER FROM THE MANAGING DIRECTOR

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(Incorporated in Bermuda with limited liability)

Board of Directors:

Registered Office:

Wong Chue Meng (Chairman) (deceased on 15th June, 2003) Wong Chong Po (Executive Chairman) Joseph C. C. Wong (Managing Director)

Cedar House, 41 Cedar Avenue, Hamilton HM12, Bermuda.

Executive Directors:

Principal Office:

Anthony Chu Kai Wah Stan Lee Shu Chung Wong Yuk Woon

Non-executive Directors:

27/F., Stelux House, 698 Prince Edward Road East, San Po Kong, Kowloon, Hong Kong.

Sakorn Kanjanapas Kwong Yiu Chung (independent) Sydney Chu Chun Keung (independent)

31st July, 2003

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATE TO REPURCHASE SHARES GENERAL MANDATE TO ISSUE SHARES AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information regarding the proposed general mandates to repurchase and to issue shares of the Company and to seek your approval of the relevant resolutions to be proposed at the forthcoming Annual General Meeting of the Company to be held on 5th September, 2003.

GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE NEW SHARES

At the Annual General Meeting of the Company held on 6th September, 2002, ordinary resolutions were passed giving general mandates to the Directors (i) to repurchase shares of the Company on The Stock Exchange of Hong Kong Limited (“the Stock Exchange”) of up to 10 per cent. of the issued share capital of the Company as at 6th September, 2002 and (ii) to allot, issue and otherwise deal with additional shares of the Company up to a limit equal to (a) 20 per cent. of the shares of the Company in issue as at 6th September, 2002 plus (b) the nominal amount of any shares repurchased by the Company.

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LETTER FROM THE MANAGING DIRECTOR

Under the terms of the Rules Governing the Listing of Securities on the Stock Exchange (“the Exchange Listing Rules”), these general mandates will lapse at the conclusion of the Annual General Meeting of the Company for 2003 unless renewed at that meeting. Ordinary resolutions will be proposed to renew the mandate to repurchase shares (“Repurchase Mandate”) and the mandate to issue shares and the explanatory statement required by the Exchange Listing Rules to be sent to the shareholders in connection with the proposed Repurchase Mandate is set out in the appendix to the circular.

ANNUAL REPORT AND ANNUAL GENERAL MEETING

A copy of the annual report of the Company for the year ended 31st March, 2003 is enclosed for your review.

The notice of the Annual General Meeting proposed to be held at 5/F., Stelux House, 698 Prince Edward Road East, San Po Kong, Kowloon, Hong Kong on Friday, 5th September, 2003 at 11:30 a.m. is set out on pages 5 to 7. At the Annual General Meeting, ordinary resolutions mentioned above will be proposed to approve the general mandates to repurchase and to issue shares of the Company.

A form of proxy for use at the Annual General Meeting is enclosed. Whether or not you are able to attend the meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return it to the Company’s Registrars in Hong Kong at 1901-5, 19th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible and in any event, so as to be received not less than 48 hours before the time appointed for the holding of the meeting. Completion and delivery of the form of proxy will not prevent you from attending and voting at the meeting if you so wish.

RECOMMENDATION

The Directors believe that the general mandate to issue shares of the Company, and the Repurchase Mandate are in the best interests of the Company as well as its shareholders. Accordingly, the Directors recommend that all shareholders vote in favour of the relevant resolutions to be proposed at the Annual General Meeting.

Yours faithfully,

On behalf of the Board

Joseph C.C. Wong Managing Director

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EXPLANATORY STATEMENT

APPENDIX

This Appendix serves as an explanatory statement, as required by the Exchange Listing Rules, to provide information to you with regard to the Repurchase Mandate.

1. THE EXCHANGE LISTING RULES

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

2. SHARE CAPITAL

As at 23rd July, 2003 (the latest practicable date prior to the printing of this circular) (“Latest Practicable Date”), the issued share capital of the Company comprised 936,340,023 shares of HK$0.10 each of the Company (“Shares”). Subject to the passing of the necessary ordinary resolutions and on the basis that no further Shares are issued or repurchased prior to the Annual General Meeting, exercise in full of the Repurchase Mandate could accordingly result in up to 93,634,002 Shares being repurchased by the Company during the course of the period prior to the next annual general meeting.

3. REASONS FOR REPURCHASES

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

4. FUNDING OF REPURCHASES

Repurchases of Shares will be funded entirely from the Company’s available cash flow or working capital facilities, which will be funds legally available for the purchase in accordance with the Memorandum of Association and Bye-Laws and the applicable laws of Bermuda.

There might be adverse effect on the working capital or gearing of the Company upon the full exercise of the Repurchase Mandate when compared with the working capital and gearing position disclosed in the audited accounts contained in the annual report for the year ended 31st March, 2003. However, 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.

5. GENERAL

None of the Directors or, to the best of their knowledge having made all reasonable enquiries, any of their associates as defined in the Exchange Listing Rules, have any present intention to sell any Shares to the Company if the Repurchase Mandate is approved by shareholders.

No connected person (as defined in the Exchange Listing Rules) has notified the Company that he has a present intention to sell Shares to the Company, or has undertaken not to do so, if the Repurchase Mandate is approved by shareholders.

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EXPLANATORY STATEMENT

APPENDIX

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

The Directors are not aware of any consequences which could arise under the Hong Kong Code on Takeovers and Mergers (the “Takeover Code”) as a consequence of any repurchases pursuant to the Repurchase Mandate. However, if as a result of a share repurchase 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. Accordingly, a shareholder or a group of shareholders acting in concert could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 of the Takeover Code.

As at the Latest Practicable Date, the Company’s controlling shareholder, the estate of Mr. Wong Chue Meng was interested, whether directly or indirectly, in 70.95% of the Company’s Shares. Shares, if repurchased by the Company during the course of the period prior to the next annual general meeting resulting in a full exercise of the Repurchase Mandate would mean that the estate of Mr. Wong Chue Meng would be interested, whether directly or indirectly, in 78.83% of the Company’s Shares.

Any purchase of Shares which results in the amount of Shares held by the public being reduced to less than 25 per cent. could only be implemented with the agreement of the Stock Exchange. Except in extraordinary circumstances, such agreement would not normally be given by the Stock Exchange.

6. SHARE PRICES

The highest and lowest prices at which the Shares have traded on the Stock Exchange during each of the previous twelve months were as follows:

	Highest	Lowest
Month	HK$	HK$
2003
June	0.204	0.152
May	0.193	0.140
April	0.190	0.190
March	0.200	0.172
February	0.190	0.170
January	0.230	0.192
2002
December	0.246	0.210
November	0.209	0.193
October	0.260	0.217
September	0.234	0.146
August	0.168	0.140
July	0.220	0.172

7. SHARE PURCHASES MADE BY THE COMPANY

The Company has not purchased any of its Shares (whether on the Stock Exchange or otherwise) in the six months preceding the date of this circular.

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NOTICE OF ANNUAL GENERAL MEETING

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(Incorporated in Bermuda with limited liability)

NOTICE IS HEREBY GIVEN that the annual general meeting of Stelux Holdings International Limited (the “Company”) will be held at 5/F., Stelux House, 698 Prince Edward Road East, San Po Kong, Kowloon, Hong Kong on Friday, 5th September, 2003 at 11:30 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 Auditors thereon for the year ended 31st March, 2003;

2. To elect Directors and to authorise the Board to fix the remuneration of the Directors for the ensuing year;

3. To consider and, if thought fit, re-appoint PricewaterhouseCoopers as Auditors of the Company to hold office from the conclusion of the meeting until the conclusion of the next annual general meeting of the Company and to authorise the Directors to fix their remuneration;

4. As special businesses:

ORDINARY RESOLUTIONS

To consider and, if thought fit, adopt with or without amendments, the following ordinary resolutions:

• (A) “THAT:

• (i) subject to paragraph (ii) below, the exercise by the Directors of the Company during the Relevant Period of all the powers of the Company to purchase shares of the Company be and it is hereby generally and unconditionally approved;

• (ii) the aggregate nominal amount of shares which may be purchased on the Stock Exchange of Hong Kong Limited or any other stock exchange recognised for this purpose by the Securities and Futures Commission of Hong Kong and The Stock Exchange of Hong Kong Limited under the Hong Kong Code on Share Repurchases pursuant to the approval in paragraph (i) above 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

• (iii) for the purpose of this resolution “Relevant Period” means the period from the passing of this resolution until whichever is the earlier of:

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

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NOTICE OF ANNUAL GENERAL MEETING

  - (b) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-laws of the Company or The Companies Act 1981 of Bermuda (as amended) to be held; and

  - (c) the revocation or variation of the authority given under this resolution by ordinary resolution of the shareholders in general meeting.”

• (B) “THAT:

• (i) subject to paragraph (iii) below and subject to the consent of the Bermuda Monetary Authority, the exercise by the Directors of the Company during the Relevant Period 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 and options which might require the exercise of such power be and it is hereby generally and unconditionally approved;

• (ii) the approval in paragraph (i) shall authorise the Directors of the Company 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;

• (iii) 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 of the Company pursuant to the approval in paragraph (i), otherwise than pursuant to (a) a Rights Issue, (b) the exercise of rights of subscription or conversion under the terms of any warrants issued by the Company or any securities which are convertible into shares of the Company (c) 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 of the Company or (d) any scrip dividend or 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 aggregate of: (aa) 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 (bb) (if the Directors are so authorised by a separate ordinary resolution of the shareholders of the Company) the nominal amount of share capital of the Company repurchased by the Company subsequent to the passing of this resolution (up to a maximum equivalent to 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

• (iv) for the purposes of this resolution:

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

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

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NOTICE OF ANNUAL GENERAL MEETING

• (b) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or the Companies Act 1981 of Bermuda (as amended) to be held; and

• (c) the revocation or variation of the approval given by this resolution by ordinary resolution of the shareholders in general meeting; and

• “Rights Issue” means an offer of shares open for a period fixed by the Directors of the Company to holders of shares of the Company 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 of the Company 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 recognised regulatory body or any stock exchange in, any territory outside Hong Kong).”

• (C) “THAT the Directors of the Company be and they are hereby authorised to exercise the powers of the Company referred to in paragraph (i) of the resolution set out as resolution (B) in the notice of the meeting of which this resolution forms a part in respect of the share capital of the Company referred to in sub-paragraph (bb) of paragraph (iii) of such resolution.”

By order of the Board Caroline Chong Company Secretary

Hong Kong, 17th July, 2003

Principal Office:

27/F., Stelux House

698 Prince Edward Road East

San Po Kong Kowloon

Hong Kong

Notes:

1. A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and, on a poll, vote on his behalf. A proxy need not be a member of the company.

1. 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 of such power or authority, shall be delivered to the Company’s Hong Kong registrar, Computershare Hong Kong Investor Services Limited, 1901–5, 19th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time fixed for holding the meeting or any adjourned meeting.

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