China Display Optoelectronics Technology Holdings Limited — Proxy Solicitation & Information Statement 2009

Dec 29, 2009

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or 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 SW Kingsway Capital Holdings Limited , you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim 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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SW KINGSWAY CAPITAL HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

MAJOR TRANSACTION IN RELATION TO THE DISPOSAL OF A 50% SHAREHOLDING INTEREST IN TOTAL EXPRESS INVESTMENTS LIMITED

A notice convening a special general meeting of SW Kingsway Capital Holdings Limited (the “Company”) to be held at 5th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong on Friday, 15th January 2010 at 10:00 a.m. is set out on pages 29 to 30 of this circular. A form of proxy for use at the special general meeting is also enclosed.

If you are unable to attend the special general meeting, please complete the accompanying form of proxy in accordance with the instructions printed thereon and return it to the Company’s Share Registrar in Hong Kong, Computershare Hong Kong Investor Services Limited, at Rooms 1806-1807, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the special general meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the meeting if they so wish.

* for identification purposes only

30 December 2009

CONTENTS

		Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
Letter from the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
2.	The Share Purchase Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
3.	The Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
4.	Financial Effects of the Disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
5.	Reasons for and Benefits of the Transaction . . . . . . . . . . . . . . . . . . . . . . . .	11
6.	Information of the Group and the Purchaser . . . . . . . . . . . . . . . . . . . . . . . .	11
7.	Financial and Trading Prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
8.	Listing Rules Implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
9.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
10.	Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
**Appendix **	I – Financial Information of the Group . . . . . . . . . . . . . . . . . . . . . .	14
**Appendix **	II – Property Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
**Appendix **	III – General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	22
**Notice of **	Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29

– i –

DEFINITIONS

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

• “Agreement” a share purchase agreement dated 26 November 2009 entered into, among others, by FDL as vendor, the Company as vendor guarantor, the Purchaser as purchaser, Mr Long Rui Ming as purchaser guarantor, pursuant to which the Purchaser agreed to acquire 1,000 shares of TEIL representing 50% of shareholding interest in TEIL from FDL

• “Board” the board of Directors

• “Business Day” a date on which banks are open for business in Hong Kong (excluding Saturday and days on which a tropical cyclone warning No. 8 or above or a “black rainstorm warning signal” is hoisted in Hong Kong)

• “Company” SW Kingsway Capital Holdings Limited, a company incorporated in Bermuda and the shares of which are listed on the main board of the Stock Exchange

• “Completion” completion of the Agreement

• “Completion Accounts”

• the consolidated financial accounts of TEIL and its subsidiaries as at 30 November 2009

• “Completion Date” the day falling on the fifth Business Day after the conditions precedent are fulfilled or otherwise waived (or such later date as FDL and the Purchaser may agree in writing prior to Completion)

• “Consideration” The total consideration for the transaction is the aggregate of:

• (a) RMB170,242,264

• (b) RMB2,000,000, being the agreed sum for settlement of half of the sum of the Sinking Fund

• (c) Such sum as equivalent to half of the sum of the Remaining Cash Balance as shown in TEIL’s Completion Accounts

– 1 –

DEFINITIONS

“Debt”	Includes the shareholder loan in the principal amount
	of HK$96,580,811, interest on the shareholder loan in
	the amount of HK$4,073,751, Mortgage to be paid in
	the amount of HK$55,000,000 and management fee in
	the amount of HK$2,564,646 for a total amount of
	approximately HK$158,219,208 as at 30 September
	2009
“Directors”	the directors of the Company
“Disposal”	the disposal of 50% of shareholding interest in TEIL by
	FDL pursuant to the Agreement
“Escrow Agent”	the escrow agent to be appointed pursuant to the
	provisions of the Agreement
“Escrow Agreement”	the escrow agreement in the agreed form, to be entered
	into by and between FDL, the Purchaser and the
	Escrow Agent

• “FDL” Festival Developments Limited, a wholly owned subsidiary of the Company, which holds a 50% interest in the share capital of TEIL

• “Group” the Company and its subsidiaries

• “HK$” Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong” the Hong Kong Special Administrative Region of the PRC

• “Jones Lang La Salle” Beijing Jones Lang La Salle Property Management Services Company Limited the property manager of the Property as of the Latest Practicable Date

• “Latest Practicable Date” 28th December 2009, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular

• “LDL”

• Luxury Development Limited, an indirect wholly owned subsidiary of TEIL, which is incorporated in Hong Kong with limited liability, is the sole owner of 9 sets of top level non-standardized penthouse units of the Property

• “Listing Rules”

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

– 2 –

DEFINITIONS

• “Long Stop Date” 29 January 2010

• “Marubeni” Marubeni Corporation, a company incorporated in Japan, its shares are listed on the Tokyo, Nagoya and Osaka stock exchanges which holds the other 50% interest in the share capital of TEIL

• “Mortgage” the mortgage on the Property in the amount of approximately HK$55,000,000 as at 30 September 2009

• “OBL” Overseas Billion Limited, an indirect wholly owned subsidiary of TEIL, which is incorporated in Hong Kong with limited liability, is the sole owner of Level 3 to Level 12 (both levels inclusive) of the Property

• “Other Sale Shares” 1,000 shares in TEIL currently held by Marubeni, representing the other 50% shareholding interest in TEIL

• “PRC” the People’s Republic of China and, for the purpose of this circular, excluding Hong Kong, the Macau Special Administrative Region and Taiwan region

• “Property”

• Level 3 to Level 22 of Block 6, No. 66 Xiaguang Lane, Chaoyang District, Beijing, the PRC

• “Purchaser” ACE Scheme Limited, a company incorporated in the British Virgin Islands

• “Purchaser Guarantor” Mr Long Rui Ming

• “Remaining Cash Balance”

• the cash balance (cash deposits at the banks) less Net Current Liabilities of TEIL and its subsidiaries as at 30 November 2009, which is estimated to be between HK$1,000,000 and HK$3,000,000. Net Current Liabilities is defined as when Net Current Assets is less than zero. Net Current Assets is current assets less cash and bank balances and Sinking Fund deposits; less current liabilities other than bank loans, loans due to shareholders, accrued interest expenses and asset management fees due to shareholders

• “RMB”

Renminbi, the lawful currency of the PRC

• “Sale Share(s)”

• 1,000 ordinary share(s) of US$1 each in the capital of TEIL

– 3 –

DEFINITIONS

• “Shareholders’ Agreement” the shareholders agreement entered into, among others, by FDL, the Company and Marubeni dated 27 October 2006

• “Shares” ordinary shares in the share capital of the Company “Sinking Fund” monies paid pursuant to PRC regulations to the developer of the development in which the Property forms part of for future renovations to the development

• “Special General Meeting” the Special General Meeting of the shareholders to be held on or about 15 January 2010 to approve the Disposal

• “Stock Exchange” the Stock Exchange of Hong Kong Limited

• “TEIL” Total Express Investments Ltd., a jointly controlled entity of the Company, which is incorporated in British Virgin Islands with limited liability

• “Transaction”

• The disposal of the Sale Shares pursuant to the terms and conditions of the Agreement

• “Valuer” RHL Appraisal Ltd

“WTL” Well Talent Limited, an indirect wholly owned subsidiary of TEIL, which is incorporated in Hong Kong with limited liability, is the sole owner of level 13 to level 22 (both levels inclusive) (save and except the 9 sets of top level non-standardized penthouse units) of the Property

– 4 –

LETTER FROM THE BOARD

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SW KINGSWAY CAPITAL HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

Chairman Dr Jonathan Koon Shum Choi

Executive Directors Ms Mary Yuk Sin Lam (Deputy Chairman) Mr William Wai Leung Wu (Chief Executive Officer) Mr Michael Koon Ming Choi

Non-Executive Directors Ms Rebecca Yuk Fung Lau Dr Lee G. Lam

Independent Non-Executive Directors Mr Robert Tsai To Sze Mr Stanley Kam Chuen Ko Mr Michael Wai Chung Wu

Registered Office Clarendon House 2 Church Street, Hamilton HM 11 Bermuda

Principal Place of Business in Hong Kong 5th Floor Hutchison House 10 Harcourt Road Central Hong Kong

30 December 2009

To the shareholders

Dear Sir/Madam,

MAJOR TRANSACTION DISPOSAL OF A 50% SHAREHOLDING INTEREST IN TOTAL EXPRESS INVESTMENT LIMITED

1. INTRODUCTION

On 1 December 2009, the Board announced that on 26 November 2009, FDL, a wholly owned subsidiary of the Company which holds a 50% interest in the share capital of TEIL, the Company, the Purchaser and the Purchaser Guarantor entered into a Share Purchase Agreement pursuant to which FDL agreed to sell and the Purchaser agreed to purchase FDL’s 50% shareholding interest in TEIL for a total consideration of approximately RMB 172,242,264 (HK$194,943,794). The consideration will be paid in cash. The cash consideration will be paid into an escrow account and will be released by the Escrow Agent to the Company pursuant to the terms of the Escrow Agreement.

* for identification purposes only

– 5 –

LETTER FROM THE BOARD

The Company, as the parent company guarantor, guarantees the due performance by FDL of its obligations under the Agreement. The Purchaser Guarantor, as the holder of 100% of the share capital of the Purchaser, guarantees the due performance by the Purchaser of its obligations under the Agreement. OBL, WTL and LDL, indirect wholly owned subsidiaries of TEIL, jointly hold the entire interest in the Property, valuation of which was approximately RMB330,000,000 (approximately, HK$374,446,840) as at 30 June 2009.

The Disposal constitutes a major transaction for the Company under Chapter 14 of the Listing Rules and is therefore subject to the approval of the Shareholders at the Special General Meeting under Rule 14.40 of the Listing Rules.

2. THE SHARE PURCHASE AGREEMENT

Details of the Sale and Purchase Agreement is set out below:

(1) Date: 26 November 2009 (2) Parties: Vendor: FDL, an investment holding company, wholly owned by the Company Purchaser: ACE Scheme Limited, a company wholly owned by Mr Long Rui Ming Vendor’s Guarantor: The Company Purchaser’s Guarantor: Mr Long Rui Ming

(3) Shares to be disposed of:

FDL’s interest in 1,000 shares of TEIL, representing 50% shareholding interest in TEIL, which through indirect wholly owned subsidiaries, OBL, WTL and LDL, holds the entire interest in the Property.

(4) Consideration:

The total consideration for the transaction will be the aggregate of:

• (a) RMB170,242,264 (approximately HK$192,680,194).

• (b) RMB2,000,000 (approximately HK$2,263,600), being the agreed sum for settlement of half of the sum of the Sinking Fund.

• (c) Such sum as equivalent to half of the sum of the Remaining Cash Balance as shown in TEIL’s Completion Accounts. For reference, as of 30 September 2009, the Remaining Cash Balance was HK$1,687,030. The Company estimates that the amount of the Remaining Cash Balance as at the date of the Completion Accounts will be between HK$1,000,000 and HK$3,000,000 and it will be paid by the Purchaser to the Vendor on the Completion Date.

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LETTER FROM THE BOARD

The consideration amount was arrived at after arms length negotiations between the parties, having regard to the valuation of the Property as at 30 June 2009, the assets and liabilities of TEIL and its subsidiaries, rental income generated by the property and costs of operations and the PRC property market environment.

The Consideration will be paid or settled in the following manner:–

• (a) RMB8,612,113 (approximately HK$9,747,189), being the “First Deposit” and part payment for the Transaction, will be paid by the Purchaser to the Vendor on the fifth Business Day after the signing of this agreement;

• (b) RMB34,448,452 (approximately HK$38,988,758), being the “Further Deposit” and part payment for the Transaction, will be paid by the Purchaser to the Vendor upon the fulfilment of the Due Diligence; and

• (c) The balance of the Consideration, will be paid by the Purchaser to the Vendor on the Completion Date.

All of the amounts set out in above shall be deposited with the Escrow Agent who will act as an escrow agent in accordance with the terms of the escrow arrangement set out in the Escrow Agreement.

On the fulfilment of the Due Diligence, the First Deposit and the Further Deposit shall be released to the Vendor to repay part of the Mortgage so that the Vendor may repay the remaining balance of the Mortgage to enable the Company to get a release of the Mortgage and discharge of the Company’s guarantee in respect of the Mortgage.

(5) Conditions:

Completion is conditional upon:

• (i) Completion of due diligence (“Due Diligence”) to be conducted on the transaction, the Property, the Sale Shares, TEIL and its subsidiaries;

• (ii) The Purchaser having obtained a legal opinion issued by Lei Jie Law Office, a law firm qualified to practice PRC laws certifying (i) TEIL’s title to the Property free from encumbrances other than those disclosed in the Agreement or the disclosure letter; and (ii) that the development scheme of the Property has been approved by all the relevant authorities without any outstanding payment of land premium, fees or charges (other than the usual and nominal application and/or handling charges) as required by the government or competent authorities which have a material adverse effect on the title, marketability, safety and inhabitability of the Property;

• (iii) the shareholders (or independent shareholders, if required) of the Company having passed the relevant resolutions at its general meeting approving this Agreement and the transactions contemplated thereunder;

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LETTER FROM THE BOARD

• (iv) the controlling shareholder (as defined under Listing Rules) of the Company having undertaken to vote in favour of the resolutions in respect of approving this Agreement and the transactions contemplated thereunder, if applicable;

• (v) all Vendor’s warranties remaining true and accurate and not misleading in any material respect as if repeated at Completion and at all times between the date of this Agreement and Completion except as may be disclosed in a disclosure letter;

• (vi) The property management contract with Jones Lang La Salle in relation to the Property having been terminated;

• (vii) Encumbrances on the Property having been discharged;

• (viii) Encumbrances on the Sale Shares, including the waiver or expiration of Marubeni’s right of first refusal and tag-along rights, having been discharged or waived; and

• (ix) all necessary consents, approvals and authorisations having been obtained from all relevant authorities in Hong Kong and the PRC and in any other applicable jurisdiction and any other third parties in connection with the Transaction and other transactions contemplated thereunder and the implementation of the transactions contemplated hereunder and all other matters incidental hereto.

As an additional condition to Completion, the Purchaser shall not be obligated to complete the transaction unless the acquisition of the Other Sale Shares having been completed unless the failure to acquire the Other Sale Shares is due to the Purchaser’s wilful and deliberate failure to comply with the terms of the agreement to purchase the Other Sale Shares. The Transaction contemplates that the Purchaser will own 100% of the share capital of TEIL on Completion.

In the event that any of the conditions precedent shall not have been fulfilled (or waived) prior to the Long Stop Date or such other date as may be agreed upon by the parties, the Agreement shall terminate and cease to be of any effect, the Vendor shall refund all amounts paid in advance of Completion to the Purchaser.

As at the Latest Practicable Date, save for the completion of the Due Diligence as set out in paragraph 5(i) above, none of the conditions precedent have been satisfied.

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LETTER FROM THE BOARD

(6) Completion

Completion shall take place by 5:00pm on or before the fifth Business Days after all the conditions precedent have been fulfilled or waived (in any event, not earlier than the 30th day after the payment of the Further Deposit by the Purchaser to the Vendor) at the office of the Escrow Agent or at such other place, on such other time and/or day as the parties may agree in writing.

At Completion, the Vendor will assign the Debt to the Purchaser, which as of 30 September 2009, amounted to approximately HK$158,219,208.

3. THE PROPERTY

The Property was acquired by the Group at a contract price of RMB236,182,869 (approximately HK$222,898,140 as at 13 April 2005) by OBL and WTL in April 2005 from (Beijing Lin Da Hua Xia Real Estate Development Company Limited (for illustration only)), a third party independent of the Company, with a purpose of expanding the Company’s assets base and diversification of its investment portfolio. The ownership of the Property was later re-structured to be held by OBL, WTL and LDL collectively, each of which is an indirect wholly owned subsidiary or TEIL.

At present, the Property has been refurbished and is operating as serviced apartments. Valuation of the Property as at 30 June 2009, amounting to RMB330,000,000 (approximately HK$374,446,840) and as at 26 November 2009, amounting to RMB340,000,000 (approximately HK$384,812,000), was given by the Valuer, a professional valuer, who is independent of and not connected with the Company, its subsidiaries, connected persons (as defined in the Listing Rules) of the Company and any of the directors, chief executive and substantial shareholders of the Group or the Purchaser. The valuation of the Property represents its “market value” which is intended to mean “the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably prudently and without compulsion.” Valuation gain on investment property attributable to appreciation of value of the Property amounting to HK$106,210,856 of which HK$53,105,428 was recognized in consolidated financial statements of the Company as at 30 June 2008. Valuation loss on investment property attributable to depreciation of value of the Property amounting to HK$30,285,272 of which HK$15,142,636 was recognized in consolidated financial statements of the Company as at 30 June 2009.

4. FINANCIAL EFFECTS OF THE DISPOSAL

Overview:

TEIL was established by the Company as a wholly owned subsidiary to indirectly acquire and hold the entire interest in the Property, which was acquired in October 2005. In October 2006, the Company sold a 50% interest in TEIL to Marubeni, a conglomerate in Japan, with significant experience in property investment and the

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LETTER FROM THE BOARD

management of serviced apartments in the PRC. To the best of the Director’s knowledge, information and belief, Marubeni is a third party independent of the Company, its subsidiaries and connected persons (as defined in the Listing Rules). It was the intention of the Company and Marubeni to develop the Property into quality serviced apartments to cater to high-end residential users, mainly the expatriates in Beijing. The price for the sale to Marubeni was based on the valuation of the Property as at 30 June 2006, which amounted to RMB 288,600,000 (approximately HK$280,357,490 as at that date). On completion of the sale to Marubeni, the Company and Marubeni agreed to jointly manage the Property and entered into a Shareholders’ Agreement, which gave the other party a right of first refusal (“ROFR”) and a tag-along right (“TAR”) in the event the other party wished to sell its interest in TEIL to a third party.

In August 2009, Marubeni indicated to the Company that it intended to sell its 50% interest in TEIL and would thereby cease to jointly manage the Property. Notice of the sale was given pursuant to the Shareholders’ Agreement. After careful consideration, the Directors including the Independent Non–Executive Directors, resolved that due to the financial position of the Company, the Company should not exercise the ROFR. Additionally, as the consideration as set out in Marubeni’s notice of sale was less than 50% of the RMB330,000,000 estimated value of the Property, the Board resolved that the Company should not exercise the TAR. Notice of this transaction will be send to Marubeni pursuant to the terms of the Shareholders’ Agreement.

Financial Information:

According to the audited financial statements of TEIL (on a consolidated basis), as at 30 June 2008, the total assets and net assets of TEIL amounted to HK$444,879,276 and HK$114,414,273, respectively. For the financial year ended 30 June 2008, the revenue and net profits (before and after taxation) amounted to HK$7,944,775 and HK$89,685,691 and HK$81,695,484, respectively.

According to the audited financial statements of TEIL (on a consolidated basis), as at 30 June 2009, the total assets and net assets of TEIL amounted to HK$409,694,698 and HK$78,275,133, respectively. For the financial year ended 30 June 2009, the revenue and net loss (before and after taxation) amounted to HK$14,263,707 and HK$37,522,665 and HK$36,139,140, respectively.

Upon Completion of the Disposal, the Company will no longer have any equity interest in TEIL and/ or any interest in the Property. It is expected that there will be a net loss of approximately HK$1,000,000 derived from the Disposal. However, the Disposal will result in a gross cash inflow of approximately HK$139,943,794 before deduction of all necessary charges.

Taking into account the net loss from the Disposal of approximately HK$1,000,000, it is expected that the Group’s consolidated total assets at the year ended 30 June 2009 will be decreased by HK$1,000,000 and total liabilities will remain unchanged.

– 10 –

LETTER FROM THE BOARD

Use of proceeds:

The gross cash inflow derived from the Disposal under the Agreement of approximately HK$139,943,794 before deduction of all necessary charges, will be applied as general working capital to focus on the core business of the Company after Completion.

5. REASONS FOR AND BENEFITS OF THE TRANSACTION

The Group is principally engaged in the business of investing in securities, stock and futures brokerage, provision of financial advisory services, asset management, money lending and other securities related financial services. With the intended departure of Marubeni, the Group will lose the services of its joint property manager, who has substantial experience in operating serviced apartments. The Directors are of the view that the disposal of the Property is in the best interest of the Company and the shareholders. Upon Completion of the Disposal, the Company will have a gross cash inflow of approximately HK$139,943,794 before deduction of all necessary charges which it will use as working capital to focus on its core business.

The Directors (including Independent Non-Executive Directors) are of the view that the terms of Agreement were negotiated on an arm’s length basis and were agreed on normal commercial terms and are fair and reasonable. The Directors consider that the Agreement is in the interest of the Company and the Shareholders as a whole.

6. INFORMATION OF THE GROUP AND THE PURCHASER

The principal activities of the Group, save for the investment in the Property, are proprietary investment in securities, stock and futures brokerage, provision of financial advisory services, asset management, money lending and other securities related financial services.

To the best of the Company’s knowledge, the Purchaser is an investment holding company wholly owned by the Purchaser Guarantor and the Purchaser Guarantor, Mr Long Rui Ming, is a real estate investor. To the best of the Directors’ knowledge, information and belief having made all reasonable enquiry, the Purchaser and its ultimate beneficial owner, Mr Long Rui Ming, are third parties independent of the Company and its connected persons (as defined in the Listing Rules).

7. FINANCIAL AND TRADING PROSPECTS

The principal activities of the Group, save for the investment in the Property, are proprietary investment in securities, stock and futures brokerage, provision of financial advisory services, asset management, money lending and other securities related financial services. The Group will continue its principal business activities and will further develop its business when the opportunities arise.

– 11 –

LETTER FROM THE BOARD

There are a number of uncertainties in the market today. As a result of the economic downturn, the Hang Seng Index went below 11,000 in October 2008, its lowest level since the beginning of the financial tsunami. However, after the fall of Lehman Brothers, the bail out of a number of financial institutions by different governments and global orchestrated rounds of interest rates cuts help to stablize the financial markets. The new quantitative easing measures adopted by a number of central banks in spring 2009 provide further boosts to the markets. China and other emerging markets outperformed the developed countries in this rise and the Hang Seng Index has returned to the pre-Lehman Brothers fall level.

Market activities picked up significantly in the recent months but people are still skeptical whether this is the beginning of another bull cycle. We remain cautiously optimistic about the Group’s business outlook for the remainder of the 2009-2010 financial year and are helping our customers to strengthen their positions through fund raising and merger and acquisition activities. We are also exploring new products and trading ideas to help our brokerage clients to be on top of the market movements.

The Group is determined to provide a full range of financial services to mid cap players. The Group will continue to advise our clients on private equity arrangements, IPO services and secondary placements, following the stage of development of our clients. The Proprietary Investment division also compliments these services and provides support in capital. The PRC is undergoing rapid development and the Directors are confident that demand for financial advices and services from mid cap companies will grow. The capital formation process in the PRC presents the Group with great opportunities.

To the best of the Directors’ knowledge, information and belief, there are no special trade factors or risks which are not mentioned elsewhere in this circular and which are unlikely to be known or anticipated by the general public, and which could materially affect the profits of the Group.

8. LISTING RULES IMPLICATIONS

As the applicable percentage ratios set out in Rule 14.07 of the Listing Rules exceed 25% but are less than 75%, the Disposal constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to shareholders’ approval in accordance with Chapter 14 of the Listing Rules. Any shareholder with a material interest in the Disposal and his associates will abstain from voting on the resolution(s) approving the Disposal. As no shareholder has a material interest in the Disposal, no shareholder is required to abstain from voting on the Disposal at the Special General Meeting. The purpose of this circular is to provide you with further information of the Share Purchase Agreement and other information required under the Listing Rules.

There is set out on pages 29 to 30 of this circular a notice convening the Special General Meeting to be held at 5th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong on Friday, 15 January 2010 at 10:00 a.m. at which an ordinary resolution will be proposed for the approval by the Shareholders of the Disposal. The votes to be

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LETTER FROM THE BOARD

taken at the Special General Meeting in respect of the ordinary resolution to approve the Disposal will be taken by poll and the results of which will be announced after the Special General Meeting.

Whether or not you are able to attend the Special General Meeting in person, you are requested to complete and return the enclosed proxy form in accordance with the instructions printed thereon to Computershare Hong Kong Investor Services Limited, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong but in the event not later than 48 hours before the time appointed for holding of the Special General Meeting or any adjournment thereof. The completion of the enclosed proxy form will not preclude you from attending and voting at the Special General Meeting or any adjournment thereof should you so wish.

9. RECOMMENDATION

The Directors (including the Independent Non-Executive Directors) are of the opinion that the Disposal is fair and reasonable and in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend that all the Shareholders should vote in favour of the ordinary resolution to be proposed at the Special General Meeting to approve the Disposal.

10. ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the Appendix I – Financial Information of the Group, Appendix II – Property Valuation and Appendix III – General Information to this circular.

Yours faithfully On behalf of the Board William Wai Leung Wu Chief Executive Officer

Note:

(1) The monetary figures have been round up or down to a whole digit.

• (2) For the purpose of this Circular, the exchange rates of RMB1 = HK$1.13180 have been used, where applicable, for purpose of illustration only and does not constitute a representation that any amounts has been, could have been or may be exchanged at any particular rate on the date or dates in question or any other date.

– 13 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. WORKING CAPITAL

The Directors are of the opinion that, after taking into account internal resources available to the Group and in the absence of unforeseen circumstances, the Group will have sufficient working capital for its present requirements for the next twelve months from the date of this circular.

2. INDEBTEDNESS – STATEMENT

Borrowings

At the close of business on 30 November 2009, (being the latest practicable date for the purpose of this indebtedness statement prior to the printing of this circular), the Group had total outstanding borrowings of approximately HK$5,485,969.

The borrowings are comprised of HK$4,465,518 in mortgages on properties located in the PRC and approximately HK$1,020,451 in finance lease obligations for office equipment.

Banking Facilities

As at 30 November 2009, the Group had total available banking facilities of approximately HK$200,000,000.

Commitment and contingent liabilities

Save as aforesaid or as otherwise disclosed herein and apart from intra-group liabilities and normal business and other payables, the Group did not have any outstanding mortgages, charges, debenture, loan capital, debt securities (whether issued or outstanding, authorized or otherwise created but unissued), term loans and overdrafts or other similar indebtedness, finance leases or hire purchase commitment, liabilities under acceptances or acceptance credits, other borrowing or indebtedness in the nature of borrowings or any guarantees or other material contingent liabilities as at close of business on 30 November 2009.

3. MATERIAL ADVERSE CHANGE

So far as the Directors are aware, there is no material adverse change in the financial or trading position of the Group since 30 June 2009, being the date up to which the latest published audited financial statements of the Group were made.

– 14 –

APPENDIX II

PROPERTY VALUATION

The following is the text of a letter and valuation certificate, prepared for the purpose of incorporation in this circular received from RHL Appraisal Ltd., an independent valuer, in connection with its valuation as at 26th November 2009 of the property interests held for investment and to be disposed of by SW Kingsway Capital Holdings Limited and its subsidiaries

==> picture [87 x 86] intentionally omitted <==

RHL Appraisal Limited Corporate Valuation & Advisory

T +852 2730 6212 F +852 2736 9284 Room 1010, 10/F, Star House Tsimshatsui, Hong Kong

30th December 2009

The Board of Directors

SW Kingsway Capital Holdings Limited

5th Floor Hutchison House No. 10 Harcourt Road Central Hong Kong

Dear Sirs,

INSTRUCTIONS

In accordance with your instructions for us to value the property interests held and to be disposed of by SW Kingsway Capital Holdings Limited (referred to as the “Company”) and its subsidiaries (hereinafter together referred to as “the Group”) in the PRC, we confirm that we have carried out property inspection, made relevant enquiries and searches and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market value of the property interests as at 26th November 2009 (referred to as the “Valuation Date”).

This letter which forms part of our valuation report explains the basis and methodology of valuation, clarifying assumption, valuation considerations, title investigation and limiting conditions of this valuation.

– 15 –

PROPERTY VALUATION

APPENDIX II

BASIS OF VALUATION

Our valuation of the property interests represents its market value which we would define as intended to mean “the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently, and without compulsion”.

METHODOLOGY OF VALUATION

In our valuation of the property interests which is held and to be disposed of by the Group, direct comparison method is adopted where comparison based on price realized on actual sales and/or asking prices of comparable properties are made. Comparable properties of similar size, character and location are analysed and carefully weighted against all the respective advantages and disadvantages of each property in order to arrive at a fair comparison of market values. For those portions of the property which are subject to tenancies, we have also taken into account the rental income derived from the existing tenancies with due allowance for the reversionary income potential of the property interests.

VALUATION CONSIDERATIONS

In valuing the property interests, we have complied with all the requirements contained in Chapter 5 and Practice Note 12 to the Rules Governing the Listing of Securities issued by The Stock Exchange of Hong Kong Limited and the HKIS Valuation Standards on Properties (First Edition 2005) published by the Hong Kong Institute of Surveyors effective from 1st January 2005.

VALUATION ASSUMPTIONS

Our valuation have been made on the assumption that the owner sells the property in the market without the benefit of a deferred term contract, leaseback, joint venture, management agreement or any similar arrangement, which could serve to affect the values of the property.

We have assumed that the owner has free and uninterrupted rights to use the property for the whole of the unexpired term of their respective Land Use Rights Certificates. We have also assumed that the owner of the property has the right to sell, mortgage, charge or otherwise dispose of the property to any person at a consideration without payment of any additional premium or substantial fee to government authorities. We have valued the property on an open market basis assuming sale subject to existing tenancies.

No allowance has been made in our report for any charges, mortgages or amounts owing on any of the property valued nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the property is free from encumbrances, restrictions and outgoings of an onerous nature, which could affect its value.

Other special assumptions of the property, if any, have been stated out in the footnotes of the valuation certificate attached herewith.

– 16 –

PROPERTY VALUATION

APPENDIX II

TITLE INVESTIGATION

We have been, in some instances, shown copies of various documents including State-owned Land Use Rights Certificate, Building Ownership Certificate and other documents relating to the property in the PRC and have made relevant enquiries. We have not examined the original documents to verify the existing title to the property and any material encumbrances that might be attached to the property or any lease amendments. However, we have relied considerably on the information given by the Group and the Company’s PRC legal adviser, Lei Jie Law Office ( ) concerning the validity of the title to the property.

All legal documents supplied by the Group have been used for reference only. No responsibility regarding legal title to the property interests is assumed in this valuation report.

LIMITING CONDITIONS

We have relied to a considerable extent on information given by the Group, in particular, but not limited to, the tenure, planning approvals, statutory notices, easements, particulars of occupancy, site area, floor areas and all other relevant matters.

We have not carried out detailed site measurements to verify the correctness of the site areas in respect of the property but have assumed that the site areas shown on the documents and official site plans handed to us are correct. All documents and contracts have been used as reference only and all dimensions, measurements and areas are approximations. No on-site measurement has been taken.

We have inspected the exterior and, where possible, the interior of the property. However, no structural survey has been made, but in the course of our inspection, we did not note any serious defects. We are not, however, able to report whether the property are free of rot, infestation or any other structural defects. No tests were carried out on any of the services.

We have had no reason to doubt the truth and accuracy of the information provided to us by the Group. We have also sought confirmation from the Group that no material factors have been omitted from the information supplied. We consider that we have been provided with sufficient information to reach an informed view, and we have no reason to suspect that any material information has been withheld.

Liability in connection with this valuation certificate is limited to the clients to whom this report is addressed and for the purpose for which it is carried out only. We will accept no liability to any other parties or any other purposes.

This report is to be used only for the purpose stated herein, any use or reliance for any other purpose, by you or third parties, is invalid. No reference to our name or our report in whole or in part, in any document you prepare and / or distribute to third parties may be made without written consent.

– 17 –

PROPERTY VALUATION

APPENDIX II

EXCHANGE RATE

All monetary sums stated in this report are in Renminbi (“RMB”).

We herewith attached a valuation certificate.

Yours faithfully, For and on behalf of RHL Appraisal Ltd.

Serena S. W. Lau Ian K. F. Ng FHKIS, AAPI, MRICS, MBA BSc(EstMan) BSc RPS(GP), MBA(HKU) MHKIS MRICS RPS(GP) Managing Director Senior Associate Director

Ms. Serena S. W. Lau is a Registered Professional Surveyor with over 18 years’ experience in valuation of properties in HKSAR, Macau SAR, mainland China and the Asia Pacific Region. Ms. Lau is an Associate of Australian Property Institute, a Fellow of The Hong Kong Institute of Surveyors as well as a registered real estate appraiser in the PRC.

Mr. Ian K. F. Ng is a Registered Professional Surveyor with over 6 years’ experience in valuation of properties in HKSAR, Macau SAR and mainland China. Mr. Ng is a Professional Member of The Hong Kong Institute of Surveyors as well as a chartered surveyor of The Royal Institution of Chartered Surveyors.

– 18 –

PROPERTY VALUATION

APPENDIX II

VALUATION CERTIFICATE

Property interests held for investment and to be disposed of by the Group in the PRC

			Market value in
		Particulars of	existing state as at
Property	Description and tenure	occupancy	26th November 2009
			RMB
Level 3 to Level 22 of	The property comprises 158 residential	As advised by the	340,000,000
Block 6	units from level 3 to level 22 of a	Company, as at the
(also known as Block	22-storey residential building with 3	Valuation Date,	(Renminbi Three
E, Ocean Express),	basement levels. The subject	portions of the	Hundred and Forty
No. 66 Xiaguang Lane,	development was completed in about	property with a total	Million only)
Chaoyang District,	2005.	gross floor area of
Beijing,		approximately
The PRC	The total gross floor area of the	11,335.63 sq.m. were
	property is approximately 20,326.46	subject to various
	square meters.	tenancies with the
		latest expiring date on
	The land use rights of the subject	30th November 2010
	development were granted for various	with total monthly
	terms expiring on 23rd April 2073 for	rental of RMB636,179
	residential use, expiring on 23rd April	exclusive of
	2043 for ancillary facility uses and	management fee of
	expiring on 23rd April 2053 for	RMB538,595.
	basement car parking use.
		The remaining
		portions of the
		property were either
		occupied by the
		Group or vacant.

Notes:

1. Pursuant to a State-owned Land Use Rights Certificate – Jing Chao Guo Yong (2003 Chu) Zi Di No. 0473 dated 20th December 2003 issued by the People’s Government of Beijing, the land use rights of a parcel of land with a site area of approximately 27,470.99 square meters were granted to (Beijing Lin Da Hua Xia Real Estate Development Company Limited) for various terms expiring

on 23rd April 2073 for residential use, expiring on 23rd April 2043 for ancillary facility uses and expiring on 23rd April 2053 for basement car parking use.

1. Pursuant to three Building Ownership Certificates all dated 30th June 2006 issued by the Beijing Construction Committee, the building ownership rights of the property with a total gross floor area of approximately 20,326.46 square meters were granted to Luxury Development Limited ( ), Well Talent Limited ( ) and Overseas Billion Limited ( ) respectively. The details are as follows:

Building Ownership		Gross Floor
Certificate No.	Portion of the Property	Area	Owner
		(sq.m.)
		(approx)
Jing Fang Quan Zheng Chao	9 duplex residential units	2,109.68	Luxury		Development
Gang Ao Tai 06 Zi Di No.	(Nos. 1704, 1705, 1804,		Limited
0096	2101, 2102, 2103, 2104,		(		)
	2201 and 2202)

– 19 –

APPENDIX II

PROPERTY VALUATION

• Building Ownership Gross Floor Certificate No. Portion of the Property Area Owner (sq.m.)

• (approx)

• Jing Fang Quan Zheng Chao 59 residential units (Nos. 7,416.28 Well Talent Limited Gang Ao Tai 06 Zi Di No. 12A01-12A09, ( ) 0097 12B01-12B09, 1501-1509, 1601-1609, 1701-1703, 1706-1709, 1801-1803, 1805-1806, 1901-1905 and 2001-2006)

• Jing Fang Quan Zheng Chao 90 residential units (Nos. 10,800.50 Overseas Billion Limited Gang Ao Tai 06 Zi Di No. 301-309, 3A01-3A09, ( ) 0098 501-509, 601-609, 701-709, 801-809, 901-909, 1001-1009, 1101-1109 and 1201-1209) Total: 20,326.46

• Pursuant to two Mortgage Agreements both dated 14th October 2008, the property with a total gross floor area of approximately 9,525.96 sq.m. is subject to mortgages in favour of Bank of China (Hong Kong) Limited for a loan up to an amount of HK$55,000,000.

• Pursuant to various Tenancy Agreements entered into between the Group and various tenants (“the tenants”), independent third parties, portions of the property with a total gross floor area of approximately 11,335.63 sq.m., as at the Valuation Date, were leased to the tenants with various terms with the latest expiring date on 30th November 2010 with total monthly rental of RMB636,179 exclusive of management fee of RMB538,595.

• As advised by the Group, the Property was acquired on 13 April 2005 at a consideration of RMB236,182,869 and total cost expended of approximately HK$33,370,000.

• Luxury Development Limited ( ), Well Talent Limited ( ) and Overseas Billion Limited ( ) are indirect wholly owned subsidiaries of Total Express Investments Limited, which is a jointly controlled entity of the Company

• The major certificates and relevant approvals of the property are summarized as follows:

• i. State-owned Land Use Rights Certificate Yes ii. Building Ownership Certificate Yes

• We have been provided with a legal opinion regarding the property interests by the Company’s PRC legal advisers, which contains, inter alia, the following:

• (i) Luxury Development Limited ( ), Well Talent Limited ( ) and Overseas Billion Limited ( ) own the respective building ownership rights of the property;

• (ii) the building ownership rights of the property are subject to two mortgages in favour of Bank of China (Hong Kong) Limited;

• (iii) Luxury Development Limited ( ), Well Talent Limited ( ) and Overseas Billion Limited ( ) are entitled to transfer, lease mortgage and dispose of the building ownership rights of the respective portions of the property upon obtaining the approval from Bank of China (Hong Kong) Limited; and

– 20 –

APPENDIX II

PROPERTY VALUATION

• (iv) there is no legal impediment for Luxury Development Limited ( ), Well Talent Limited ( ) and Overseas Billion Limited ( ) to apply for the land administration department of the government to obtain the land use rights certificates of the respective portions of the property.

– 21 –

GENERAL INFORMATION

APENDIX III

1. RESPONSIBILITY STATEMENT

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

2. DIRECTORS’ AND CHIEF EXECUTIVES’ INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES

As the Latest Practicable Date, the Directors and the chief executive of the Company had the following interests and short positions in the shares, underlying shares of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 & 8 of Part XV of the SFO (including interest and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register of the Company referred to therein or were required, pursuant to Part XV of the SFO or the Model Code for Securities Transactions by Directors of Listed Issuers contained in the Listing Rules, to be notified to the Company and the Stock Exchange:

(i) Interest in long positions of ordinary shares of the Company

		Number of	% of
		ordinary	total
	Type of	shares in the	issued
Name of director	interest	Company	shares
Dr Jonathan Koon Shum Choi*	Corporate	2,411,661,327	74.25%
Ms Mary Yuk Sin Lam*	Corporate	2,411,661,327	74.25%
Ms Mary Yuk Sin Lam	Personal	7,500,000	0.23%
Ms Rebecca Yuk Fung Lau	Personal	4,200,000	0.13%
Mr Michael Wai Chung Wu	Personal	2,514,000	0.08%
Mr Stanley Kam Chuen Ko	Personal	1,200,000	0.04%

• Dr Jonathan Koon Shum Choi and Ms Mary Yuk Sin Lam are deemed to be interested in 2,411,661,327 ordinary shares by virtue of the SFO. Such interest in shares is also set out under the section “Persons having notifiable interest” shown on page 25.

– 22 –

GENERAL INFORMATION

APENDIX III

• (ii) Interest in long positions of common shares of Kingsway International Holdings Limited (“Kingsway International”), the ultimate holding company of the Company

				*Total	*% of
				number of	total
	Personal	Corporate	Other	common	issued
Name of Director	interest	interest	interest	shares	shares
Dr Jonathan Koon
Shum Choi**	10,653,096	26,828,055	–	37,481,151	46.7%
		(Note 1)
Ms Mary Yuk Sin
Lam**	19,517,257	–	12,915,060	32,432,317	40.4%
			(Note 2)
Mr Michael Koon
Ming Choi	106,937	–	–	106,937	0.1%
Mr Stanley Kam
Chuen Ko	20,400	–	–	20,400	<0.1%
Ms Rebecca Yuk
Fung Lau	100	–	–	100	<0.1%

• Excludes interest in convertible debentures to acquire common shares of Kingsway International which is disclosed in section (v) below.

• ** By virtue of their interest in Kingsway International, Dr Jonathan Koon Shum Choi and Ms Mary Yuk Sin Lam are deemed to be interested in the shares of the subsidiaries (including the Company as disclosed in section (i) above) of Kingsway International under the SFO.

Notes:

• (1) Of these, 12,750,000 shares are held by Sun Wah Capital Limited. Dr Jonathan Koon Shum Choi is deemed to be interested in these shares as he is entitled to exercise or control the exercise of one third or more of the voting power at general meetings of Sun Wah Capital Limited.

The remaining 14,078,055 shares are held by Scarlet Red Limited. Dr Jonathan Koon Shum Choi is deemed to be interested in these shares as he is entitled to exercise or control the exercise of one third or more of the voting power at general meetings of Scarlet Red Limited.

• (2) Of these, 10,515,060 shares are held by Dynasty International Holdings Limited which is a wholly owned subsidiary of Global Fame Limited. Global Fame Limited is wholly owned by The WKC Lam Family Trust which is a discretionary trust with Ms Mary Yuk Sin Lam’s two children as the beneficiaries. Ms Lam is a trustee of The WKC Lam Family Trust.

Of these, 2,400,000 shares are held by Abundant World Limited. Abundant World Limited is wholly owned by The Mary Lam Family Trust which is a discretionary trust with Ms Mary Yuk Sin Lam and her two children as the beneficiaries.

– 23 –

GENERAL INFORMATION

APENDIX III

• (iii) Interest in long positions of ordinary shares of HK Weaver Group Limited, a fellow subsidiary of the Company

		Number	% of
		of	total
	Type of	ordinary	issued
Name of director	interest	shares	shares
Ms Mary Yuk Sin Lam	Personal	28,518	2.2%
Ms Mary Yuk Sin Lam	Other	59,620	4.6%
Mr Michael Wai Chung Wu	Personal	39,474	3.0%
Ms Rebecca Yuk Fung Lau	Personal	5,000	0.4%

• (iv) Interest in options to acquire ordinary shares of the Company and common shares of Kingsway International

Pursuant to a share option schemes operated by the Company and Kingsway International, certain directors had been granted options to subscribe for the shares of the Company and Kingsway International respectively. There were no options outstanding as at 30 June 2009 and 2008 and no options granted, exercised or cancelled in accordance with the terms of the share option schemes.

(v) Interest in convertible unsecured debentures to acquire common shares of Kingsway International

		Principal	Number of
	Type of	amount of	underlying
Name of directors	interests	debentures	shares	Note
Dr Jonathan Koon Shum Choi*	Corporate	C$4,500,000	5,625,000	(a)
Mr Michael Koon Ming Choi**	Corporate	C$1,500,000	1,875,000	(a)

• The debentures are held by Sun Wah Capital Limited. Dr Jonathan Koon Shum Choi is deemed to be interested in these debentures as he is entitled to exercise or control the exercise of one third or more of the voting power at general meetings of Sun Wah Capital Limited. After the conversion of the debentures, Dr Jonathan Koon Shum Choi is deemed beneficial control of a total of 43,106,151 shares.

• ** The debentures are held by Ideal Performance Limited, a company wholly owned by Mr Michael Koon Ming Choi who is deemed to be interested in these debentures. After the conversion of the debentures, Mr Michael Koon Ming Choi is deemed beneficial control of a total of 1,981,937 shares.

Note:

• (a) The debentures bear interest at the rate of 9% per annum payable semi-annually and mature on 19 September 2011. The debentures are convertible into common shares of Kingsway International at any time prior to the close of business on the earlier of maturity and the business day immediately preceding the date fixed for redemption at a conversion price of C$0.80 per share.

– 24 –

GENERAL INFORMATION

APENDIX III

Save as disclosed above, as the Latest Practicable Date, none of the Directors and the chief executive of the Company held any interests and short positions in the shares, underlying shares of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 & 8 of Part XV of the SFO (including interest and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register of the Company referred to therein or were required, pursuant to Part XV of the SFO or the Model Code for Securities Transactions by Directors of Listed Issuers contained in the Listing Rules, to be notified to the Company and the Stock Exchange.

3. PERSONS HAVING NOTIFIABLE INTERESTS

As at the Latest Practicable Date, so far as is known to any Director or chief executive of the Company, the following persons (other than a Director or the chief executive of the Company) had an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group:

					% of
					total
		Country of	Number of ordinary shares in		issued
	Name of shareholders	incorporation	the Company		shares	Note
			Direct	Deemed
			interest	interest
(1)	World Developments Limited	British Virgin Islands	2,411,661,327	–	74.25%	(a)
(2)	Innovation Assets Limited	British Virgin Islands	–	2,411,661,327	74.25%	(a)
(3)	Kingsway International	Bermuda	–	2,411,661,327	74.25%	(a)
	Holdings Limited

Note:

• (a) These shares represent the same interest and are therefore duplicated amongst World Developments Limited, Innovation Assets Limited and Kingsway International. World Developments Limited is a wholly owned subsidiary of Innovation Assets Limited whose entire issued share capital is beneficially owned by Kingsway International. Dr Jonathan Koon Shum Choi beneficially owns or has control of approximately 46.7% of the issued share capital of Kingsway International and therefore is deemed (by virtue of the SFO) to be interested in these 2,411,661,327 shares. Ms Mary Yuk Sin Lam beneficially owns or has control of approximately 40.4% of the issued share capital of Kingsway International and therefore is deemed (by virtue of the SFO) to be interested in these 2,411,661,327 shares.

Save as disclosed above, as at the Latest Practicable Date, the register of substantial shareholders maintained under Section 336 of the SFO shows that the Company had not been notified of any substantial shareholders’ interests and short positions, being 5% or more of the Company’s issued share capital.

– 25 –

GENERAL INFORMATION

APENDIX III

4. SERVICE CONTRACTS OF DIRECTORS

As at the Latest Practicable Date, none of the Directors had a service contract with the Company or any member of the Group which is not determinable by the Company or any member of the Group within one year without payment of compensation, other than statutory compensation.

5. COMPETING INTERESTS OF DIRECTORS

As at the Latest Practicable Date, none of the Directors and his or her respective associate, had interests in a business which competes or is likely to compete, either directly or indirectly, with the business of the Group.

6. DIRECTORS’ INTEREST IN CONTRACT

There was no contract or arrangement, as at the Latest Practicable Date, subsisting in which any Director was materially interested and which was significant in relation to the business of the Group.

7. DIRECTORS’ AND EXPERTS’ INTEREST IN ASSETS OF THE GROUP

As at the Latest Practicable Date, none of the Directors or the experts (as named in this section) has any interests, direct or indirect, in any assets which have been, since 30 June 2009, being the date to which the latest published audited financial statements of the Group were made up, acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

8. EXPERTS’ QUALIFICATION AND CONSENT

The qualifications of the experts who have given opinions which are contained in this circular are as follows:

Name Qualifications RHL Appraisal Ltd. Chartered surveyor and independent valuer

As at the Latest Practicable Date, RHL Appraisal Ltd. had no shareholding in any member of the Group and had no right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

RHL Appraisal Ltd. has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its respective letter, report and/or references to its name in the form and context in which respectively appear.

– 26 –

GENERAL INFORMATION

APENDIX III

9. MATERIAL CONTRACTS

No contracts (not being contracts entered into the ordinary course of business) had been entered into by the Company or its subsidiaries within two years preceding the Latest Practicable Date.

10. DOCUMENTS FOR INSPECTION

Copies of the following documents will be available for inspection at 5th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong during the normal business hours on any weekday (Monday to Friday), except public holidays, for a period of 14 days commencing from the date of this circular:

• (a) the memorandum of association and bye-laws of the Company;

• (b) the valuation report set out in Appendix II to this circular;

• (c) the written consent referred to in the paragraph under the heading “Experts’ Qualification and Consent” in this Appendix;

• (d) the annual reports of the Company for the two years ended 30 June 2008 and 2009;

• (e) a copy of each circular issued pursuant to the requirements set out in Chapters 14 and/or 14A which has been issued since 30 June 2009.

11. LITIGATION

As at the Latest Practicable Date, none of the members of the Group is engaged in any litigation or claims of material importance and no litigation or claims of material importance is known to the Directors or the Company to be pending or threatened by or against any member of the Group.

12. COMPANY SECRETARY AND AUDITORS

Company Secretary: Mr Vincent Wai Shun Lai is the company secretary. Mr Lai is a qualified solicitor in Hong Kong and is admitted to practice law in the United States of America. Mr Lai holds a Bachelors of Science degree in economics from the State University of New York at Albany and a Juris Doctor degree from Albany Law School.

Auditors: Deloitte Touche Tohmatsu, Certified Public Accountants, Hong Kong.

– 27 –

GENERAL INFORMATION

APENDIX III

13. REGISTERED OFFICE, HEAD OFFICE AND TRANSFER OFFICES

• (a) The registered office of the Company is situated at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda.

• (b) The head office and principal place of business of the Company is situated at 5th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong.

• (c) The Company’s principal share registrar is Butterfield Fulcrum Group (Bermuda) Limited, Rosebank Centre, 11 Bermudiana Road, Pembroke HM08 Bermuda.

• (d) The Company’s branch share registrar is Computershare Hong Kong Investor Services Limited, Rooms 1806-1807, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

– 28 –

NOTICE OF SPECIAL GENERAL MEETING

==> picture [116 x 45] intentionally omitted <==

SW KINGSWAY CAPITAL HOLDINGS LIMITED

*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00188)

NOTICE IS HEREBY GIVEN THAT a special general meeting of the Company will be held at 5th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong on Friday, 15th January 2010 at 10:00 a.m. to consider, and, if thought fit, pass the following resolution (with or without modifications) as ordinary resolution of the Company:

ORDINARY RESOLUTION

THAT

• (a) the share purchase agreement dated 26 November 2009 (the “ Share Purchase Agreement ”) (copy of which, signed by the Chairman of the meeting for the purposes of identification, has been produced to the meeting marked “A”) entered into between Festival Developments Limited (the “ Vendor ”), a wholly-owned subsidiary of the Company, as vendor, and ACE Scheme Limited (the “ Purchaser ”) as purchaser pursuant to which the Vendor agreed to dispose of the Vendor’s 50% interest in the issued share capital of Total Express Investments Limited (“ TEIL ”) for a total consideration of approximately HK$194,943,794, and the transactions contemplated thereunder be and are hereby approved;

• (b) the entering into of the Share Purchase Agreement by the Vendor be and is hereby approved, confirmed and ratified; and

• (c) the directors of the Company be and are hereby authorized to do such acts and/or things and/or execute all such documents incidental to, ancillary to or in connection with matters contemplated in or relating to the Share Purchase Agreement as they may in their absolute discretion consider necessary, desirable or expedient to give effect to the Share Purchase Agreement and the implementation of all transactions contemplated thereunder and to agree to such variation, amendment or waiver as are, in the opinion of the directors of the Company, in the interest of the Company.

By Order of the Board Vincent Wai Shun Lai Company Secretary

Hong Kong, 30th December 2009

* for identification purposes only

– 29 –

NOTICE OF SPECIAL GENERAL MEETING

Notes:

• (1) A member of the Company entitled to attend and vote at the Special General Meeting is entitled to appoint one or more proxies to attend and, in the event of a poll, vote on his/her behalf. A proxy needs not be a member of the Company. If more than one proxy is so appointed, the appointment shall specify the number of shares in respect of which each such proxy is so appointed.

• (2) To be valid, the form of proxy together with the authorization letter or other authority (if any) under which is signed or a certified copy thereof, must be deposited at the share registrar of the Company, in Hong Kong, Computershare Hong Kong Investor Services Limited, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the Meeting, or any adjournment thereof.

• (3) Completion and delivery of the form of proxy will not preclude a member from attending and voting in person at the Special General Meeting if the member so desires and in such event, the instrument appointing a proxy shall be deemed to be revoked.

– 30 –