THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited (the "Stock Exchange") 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.

This circular, for which the directors (the "Directors") of Directel Holdings Limited (the "Company") collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM of the Stock Exchange for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

If you are in doubt as to any aspect of this circular, 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 the Company, you should at once hand this circular and accompanying proxy form to the purchaser or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

DIRECTEL HOLDINGS LIMITED

直通電訊控股有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock code: 8337)

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, AMENDMENTS OF THE MEMORANDUM AND ARTICLES OF ASSOCIATION, RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

This circular will remain on the website of the Stock Exchange at www.hkexnews.hk on the "Latest Listed Company Information" page for at least 7 days from the date of its posting. This circular will also be posted on the Company's website at www.directel.hk.

A notice convening the Annual General Meeting of the Company to be held at Office Nos. 1, 2, 14 and 15, 37th Floor, Hong Kong Plaza, No. 188 Connaught Road West, Hong Kong on Thursday, 5 June 2025 at 10:00 a.m. is set out on pages 38 to 43 of this circular. Whether or not you intend to attend the Annual General Meeting, you are requested to complete and return the accompanying proxy form to the Company's branch share registrar in Hong Kong, Tricor Investor Services Limited at 17 Floor, Far East Finance Centre, 16 Harcourt Road, Hong Kong, in accordance with the instructions printed thereon not less than 48 hours (i.e. 10:00 a.m. on Tuesday, 3 June 2025) before the time appointed for holding the Annual General Meeting or any adjournment thereof. The return of the proxy form will not preclude you from attending and voting in person in the Annual General Meeting if you so wish and in such event, the form of proxy previously submitted shall be deemed to be revoked.

29 April 2025

CHARACTERISTICS OF GEM OF THE STOCK EXCHANGE

GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration.

Given that the companies listed on GEM are generally small and mid-sized companies, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

CONTENTS

Page

DEFINITIONS ... 1
LETTER FROM THE BOARD OF DIRECTORS ... 3
APPENDIX I — EXPLANATORY STATEMENT ... 11
APPENDIX II — PROPOSED AMENDMENTS TO THE MEMORANDUM AND ARTICLES OF ASSOCIATION 15
NOTICE OF ANNUAL GENERAL MEETING ... 38
ii -

DEFINITIONS

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

“Annual General Meeting” the annual general meeting of the Company convened and to be held on Thursday, 5 June 2025 at 10:00 a.m. at Office Nos. 1, 2, 14 and 15, 37th Floor, Hong Kong Plaza, No. 188 Connaught Road West, Hong Kong or any adjournment thereof, the notice of which is set out on pages 38 to 43 of this circular

“Articles of Association” the second amended and restated articles of association of the Company adopted on 15 June 2022 and as amended from time to time

“Associate(s)” has the meaning as ascribed to it/them under the GEM Listing Rules

“Board” the board of Directors of the Company

“Company” Directel Holdings Limited (直通電訊控股有限公司), a company incorporated in the Cayman Islands with limited liability whose securities are listed on GEM

“connected person” has the meaning as ascribed to it under the GEM Listing Rules

“Director(s)” the director(s) of the Company

“GEM” GEM of the Stock Exchange

“GEM Listing Rules” the Rules Governing the Listing of Securities on GEM

“Group” the Company and its subsidiaries

“HK$” Hong Kong Dollar, the lawful currency of Hong Kong

“Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

“Latest Practicable Date” 22 April 2025 being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained herein

DEFINITIONS

"Memorandum and Articles of Association"
the second amended and restated memorandum of association and articles of association of the Company adopted on 15 June 2022

"New Memorandum and Articles of Association"
the third amended and restated memorandum of association and articles of association of the Company proposed to be adopted at the Annual General Meeting

"Nomination Committee"
the nomination committee of the Board

"Proposed Amendments"
the proposed amendments to the Memorandum and Articles of Association as set out in Appendix II to this circular

"SFO"
the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

"Share(s)"
ordinary share(s) of HK$0.20 each in the share capital of the Company

"Shareholder(s)"
holders of the Share(s)

"Stock Exchange"
The Stock Exchange of Hong Kong Limited

"Takeovers Code"
the Code on Takeovers and Mergers and Share Buy-backs issued by the Hong Kong Securities and Future Commission, as amended from time to time

"%"
per cent.

LETTER FROM THE BOARD OF DIRECTORS

DIRECTEL HOLDINGS LIMITED

直通電訊控股有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock code: 8337)

Non-executive Directors:

Mr. Li Kin Shing (Chairman)

Mr. Wong Kin Wa

Executive Directors:

Mr. Pang Kwok Chau (Chief Executive Officer)

Independent non-executive Directors:

Mr. Chen Xue Dao

Ms. Lee Man Yee, Maggie

Mr. Liu Kejun

Registered office:

Windward 3

Regatta Office Park

PO Box 1350

Grand Cayman KY1-1108

Cayman Islands

Head office and principal place of business:

Office Nos. 1, 2, 14 and 15

37th Floor

Hong Kong Plaza

No. 188 Connaught Road West

Hong Kong

29 April 2025

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, AMENDMENTS OF THE MEMORANDUM AND ARTICLES OF ASSOCIATION, RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

At the Annual General Meeting, resolutions will be proposed to (i) grant to the Directors general mandates to allot, issue and deal with new Shares of the Company and to repurchase Shares of the Company; (ii) amend the Memorandum and Articles of Association and adopt the

LETTER FROM THE BOARD OF DIRECTORS

New Memorandum and Articles of Association; and (iii) re-elect the Directors in accordance with the Articles of Association of the Company. This circular contains the explanatory statement in compliance with the GEM Listing Rules and to give all the information reasonably necessary to enable Shareholders of the Company to make an informed decision on whether to vote for or against the resolutions.

GENERAL MANDATES

At the Annual General Meeting, separate ordinary resolutions will be proposed to renew the general mandates to authorise the Directors (i) to allot, issue and otherwise deal with Shares not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company at the date of passing of the resolution (the "Issue Mandate"); (ii) to exercise all powers (the "Repurchase Mandate") of the Company to repurchase issued and fully paid Shares on GEM up to a maximum of 10% of the aggregate nominal amount of the issued share capital of the Company at the date of the passing of the resolution; and (iii) to extend the general mandate granted to the Directors to allot, issue and deal with additional Shares as mentioned in paragraph (i) above by the amount representing the aggregate nominal amount of the share capital of the Company repurchased by the Company under the Repurchase Mandate.

As at the Latest Practicable Date, there were in issue an aggregate of 244,875,000 Shares. Subject to the passing of the proposed resolution for the grant of the Issue Mandate and on the basis that no Share is issued or repurchased by the Company prior to the Annual General Meeting, the Directors will be authorised to allot and issue under the Issue Mandate up to 48,975,000 Shares, and to the extent the Repurchase Mandate is exercised, plus the amount of Shares representing the aggregate nominal amount of the share capital of the Company repurchased by the Company under the Repurchase Mandate.

The Issue Mandate and the Repurchase Mandate shall continue to be in force during the period ending on the earliest of (i) the date of the next annual general meeting; (ii) the date by which the next annual general meeting of the Company is required to be held by law or by its Articles of Association; or (iii) the date upon which such authority is revoked or varied by an ordinary resolution of the Shareholders in a general meeting of the Company. The existing general mandates to issue and repurchase Shares granted to the Directors pursuant to the resolutions passed by the Shareholders of the Company on 6 June 2024 will expire at the Annual General Meeting.

EXPLANATORY STATEMENT

An explanatory statement containing all relevant information relating to the proposed Repurchase Mandate is set out in Appendix I to this circular. The information in the explanatory statement is to provide you with information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolution to grant to the Directors the Repurchase Mandate.

LETTER FROM THE BOARD OF DIRECTORS

PROPOSED AMENDMENTS TO THE MEMORANDUM AND ARTICLES OF ASSOCIATION

Reference is made to the announcement of the Company dated 31 March 2025 in relation to the Proposed Amendments. As disclosed therein, the Directors propose to make certain amendments to the Memorandum and Articles of Association in order to make it in line with the latest legal and regulatory requirements. In view of the proposed changes, the Board proposes to adopt the New Memorandum and Articles of Association in substitution for, and to the exclusion of, the Memorandum and Articles of Association. The purpose and principal effect of the Proposed Amendments are as follows:

(a) to bring the relevant provisions of the Memorandum and Articles of Association in line with the latest legal and regulatory requirements, including the relevant requirements relation to the expanded paperless listing regime and the holding of hybrid general meeting and vote by electronic means by listed issuers and the relevant amendments made to the GEM Listing Rules which took effect on 10 February 2025 and company law of the Cayman Islands;

(b) to authorise the Company to hold treasury shares;

(d) to make other consequential and housekeeping changes to the Memorandum and Articles of Association.

The Company's legal advisers as to Hong Kong law and as to Cayman Islands law have respectively confirmed that the Proposed Amendments are in compliance with the requirements of the GEM Listing Rules and do not contravene or violate the Cayman Islands laws. The Company has also confirmed that there is nothing unusual about the Proposed Amendments for a company listed in Hong Kong.

The Proposed Amendments and the proposed adoption of the New Memorandum and Articles of Association will be subject to the approval of the Shareholders by way of a special resolution at the Annual General Meeting and will become effective upon the approval by the Shareholders at the Annual General Meeting. The Proposed Amendments is set out in Appendix II to this circular.

RE-ELECTION OF DIRECTORS AND CONTINUOUS APPOINTMENT OF AN INDEPENDENT NON-EXECUTIVE DIRECTOR WHO HAS SERVED FOR MORE THAN NINE YEARS

As at the Latest Practicable Date, the non-executive Directors are Mr. Li Kin Shing and Mr. Wong Kin Wa; the executive Director is Mr. Pang Kwok Chau; and the independent non-executive Directors are Mr. Chen Xue Dao, Ms. Lee Man Yee, Maggie and Mr. Liu Kejun.

LETTER FROM THE BOARD OF DIRECTORS

Pursuant to the Articles of Association, 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, then the number nearest to but not less than one-third, shall retire from office by rotation provided that every Director (including those appointed for a specific term) shall be subject to retirement by rotation at an annual general meeting at least once every three years.

In accordance with the article 108(a) of the Articles of Association and code provision B.2.2 of the Corporate Governance Code (the "CG Code") set out in Appendix C1 to the GEM Listing Rules, Mr. Wong Kin Wa and Mr. Chen Xue Dao, will retire and being eligible, offer themselves for re-election at the Annual General Meeting.

Besides, in accordance with code provision B.2.4 (a) of the CG Code, the length of tenure of each existing independent non-executive Director is set out below:

Ms. Lee Man Yee, Maggie 14 years since 20 May 2010
Mr. Chen Xue Dao 14 years since 20 May 2010
Mr. Liu Ke Jun 9 years since 7 June 2016 (by 7 June 2025)

Pursuant to code provision B.2.4(b) of the CG Code, the Company should appoint a new independent non-executive Director at its forthcoming annual general meeting if all independent non-executive Directors on the Board are long serving independent non-executive Directors for more than nine years. All existing independent non-executive Directors will have served in the Company for more than nine years by 7 June 2025. The Company is in the process of identifying suitable candidate(s) and seeking to recruit one or more independent non-executive Director(s) to meet the requirement under code provision B.2.4(b) as soon as practicable. Further announcement(s) will be made by the Company as and when appropriate.

Besides, according to code provision B.2.3 of the CG Code, if an independent non-executive Director has served more than nine years, any further appointment of such independent non-executive Director should be subject to a separate resolution to be approved by Shareholders.

In accordance with the nomination policy of the Company, the Nomination Committee has reviewed the biographies of each of Mr. Wong Kin Wa and Mr. Chen Xue Dao, who will be subject to retirement and re-election at the Annual General Meeting, and took into consideration their knowledge, experience, capability and various diversity aspects as set out in the board diversity policy of the Company as well as their overall contributions and services to the Company, including their attendance of Board/general meetings and the level of participation and performance on the Board over the years. The Nomination Committee and the Board are not aware of any matter that may occur and affect the independence of Mr. Chen Xue Dao. Mr. Chen Xue Dao had performed his duty as the independent non-executive Director to the satisfaction of the Board and has not engaged in any executive management of the Group.

LETTER FROM THE BOARD OF DIRECTORS

The Nomination Committee is of the view that Mr. Wong Kin Wa and Mr. Chen Xue Dao will continue to contribute to the Board with their respective perspectives, skills and experience. In addition, Mr. Chen Xue Dao does not have any financial or family relationships with any other Directors, senior management, substantial or controlling shareholders of the Company, which could give rise to a conflict of interests situation or otherwise affect his exercise of independent judgement. The Nomination Committee believes that Mr. Chen Xue Dao committed to his role as an independent non-executive Director and will continue to be independent.

Taking into consideration of the above, recommendations of the proposals to re-elect Mr. Wong Kin Wa as a non-executive Director and Mr. Chen Xue Dao as an independent non-executive Director were made by the Nomination Committee to the Board and the Board accepted the nomination by the Nomination Committee and recommended Mr. Wong Kin Wa and Mr. Chen Xue Dao to stand for re-election by the Shareholders at the Annual General Meeting.

Brief biographical and other details of Mr. Wong Kin Wa and Mr. Chen Xue Dao, who are proposed to be re-elected at the Annual General Meeting are set out as follows:

Mr. Wong Kin Wa (黄建華), aged 57, is a non-executive Director. Mr. Wong obtained a diploma in auditing from Guangzhou Radio & TV University in 1988. Mr. Wong has over 24 years of finance and marketing experience, in particular in the telecommunications industry in Hong Kong and Macau. He is an executive director of Global Link Communications Holdings Limited ("Global Link"), a company listed on GEM, since 26 May 2016 and was further appointed as the chief executive officer of Global Link with effect from 27 November 2020. Mr. Wong had been an executive director and chief financial officer of Goldstream Investment Limited (previously known as International Elite Ltd. ("IEL")) till 27 December 2018, a company listed on the Main Board and controlled by Mr. Li Kin Shing and his spouse, Ms. Kwok King Wa till 28 November 2018. Before joining IEL in 2000, he was the manager of China-Hong Kong Telelink Co., Ltd. from 1997 to 1999. Mr. Wong joined Denway Motors Limited (駿威汽車有限公司) (previously known as Denway Investment Limited), a company whose shares were formerly listed on the Main Board, as the vice general manager of the finance department from 1993 to 1997. He was appointed as a non-executive Director on 31 August 2009.

Mr. Wong has entered into a renewal service agreement with the Company to serve as a non-executive Director for a term of three years commencing from 1 May 2022, which may be terminated by either party thereto giving to the other not less than three months' prior notice in writing or less than three months' prior notice in writing agreed by both parties. Pursuant to the service agreement, Mr. Wong is entitled to an annual remuneration of HK$80,000. He is also entitled to a bonus payment on such amount as shall be determined by the Board in its absolute discretion. The determination of his emoluments is based on salaries paid by comparable companies, time commitment, his duties and responsibilities in the Company, the Company's performance and its remuneration policy.

LETTER FROM THE BOARD OF DIRECTORS

Mr. Chen Xue Dao (陳學道), aged 82, was appointed as an independent non-executive Director on 20 May 2010. Mr. Chen is currently an honorary member of the China Institute of Communications (中國通信學會). He was the honorary chairman of the Guangdong Institute of Communications (廣東省通信學會) and honorary chairman of Guangdong Communication Industry Association (廣東省通信行業協會) till 2017. Mr. Chen holds the qualification of a senior engineer at Professor grade and he has been granted the special subsidy by the State Council of the PRC for his prominent contributions to engineering science since 1992. From August 2010 to August 2014, Mr. Chen was an independent director of Eastone Century Technology Holding Co., Ltd. (Guangdong) (廣東宜通世紀科技股份有限公司) (stock code: 300310), a company listed in the Shenzhen Stock Exchange. Mr. Chen has been an independent director of GCI Science & Technology Co., Ltd. (廣州傑賽科技股份有限公司), a company listed in the Shenzhen Stock Exchange with stock code 002544 till May 2018 and has been an independent non-executive director of IEL till 1 December 2019.

Mr. Chen has served the Company as an independent non-executive Director for more than 9 years, however the nomination committee and the Board consider that Mr. Chen continues to be independent and is able to satisfy the GEM Listing Rules' requirements for independence as an independent non-executive Director for the following reasons:

(a) Mr. Chen has confirmed his independence to the Stock Exchange in respect of each of the factors set out in Rule 5.09 of the GEM Listing Rules;

(b) Mr. Chen has demonstrated continued independent judgement which contributes positively to the development of the Company's strategy and policies;

(c) since the listing of the Company in 2010, neither Mr. Chen nor any of his immediate family members, has had and have any executive or management role or functions in the Company and its subsidiaries, nor has he or any of his immediate family members been employed by any member of the Group;

(d) neither Mr. Chen nor any of his immediate family members, has received any remuneration from the Company apart from Director's fees and does not participate in the Group's staff incentive plan or pension scheme;

(e) neither Mr. Chen nor any of his immediate family members, has received any remuneration from a third party in relation to his directorship;

(f) neither Mr. Chen nor any of his immediate family members, has any financial, business, family or other material relationships with the Group, its management, advisers and business;

(g) neither Mr. Chen nor any of his immediate family members, holds any cross directorships or other significant links with other directors through involvement with other companies;

LETTER FROM THE BOARD OF DIRECTORS

(h) neither Mr. Chen nor any of his immediate family members, holds any issued Share capital of the Company;

(i) neither Mr. Chen nor any of his immediate family members, serves as a director or employee of a significant competitor of the Group; and

(j) after due and careful consideration, the Nomination Committee of the Board considers Mr. Chen suitably independent to carry out his duties as an independent non-executive Director.

The Board would consider to enhance its diversity with different expertise when appointing or re-electing an independent non-executive Director. Mr. Chen possess extensive experience and knowledge in telecommunications technology, information industry and engineering science. As such, the nomination committee and the Board consider Mr. Chen is independent and can bring further contributions to the Board and its diversity with his experience and expertise.

Mr. Chen has entered into a renewal service agreement with the Company to serve as an independent non-executive Director for a term of three years commencing from 1 June 2022, which may be terminated by either party thereto giving to the other not less than three months' prior notice in writing or less than three months' prior notice in writing agreed by both parties. Pursuant to the service agreement, Mr. Chen is entitled to an annual remuneration of HK$80,000. He is also entitled to a bonus payment on such amount as shall be determined by the Board in its absolute discretion. The determination of his emoluments is based on salaries paid by comparable companies, time commitment, his duties and responsibilities in the Company, the Company's performance and its remuneration policy.

Mr. Chen, being the independence non-executive Director eligible for re-election at the Annual General Meeting, has confirmed his independence pursuant to Rule 5.09 of the GEM Listing Rules and the Company still considers him to be independent.

Save as disclosed hereof, as at the Latest Practicable Date, and to the best knowledge and belief of the Board, the Directors confirmed that:

(a) each of Mr. Wong Kin Wa and Mr. Chen Xue Dao did not have any relationships with any Director, senior management, substantial Shareholder or controlling Shareholder of the Company;

(b) each of Mr. Wong Kin Wa and Mr. Chen Xue Dao had no other interests in the Shares which are required to be disclosed under Part XV of the SFO;

(c) each of Mr. Wong Kin Wa and Mr. Chen Xue Dao did not hold any directorships in public companies the securities of which are listed on any securities market in Hong Kong or overseas in the last three years, or hold other major appointments and professional qualifications;

LETTER FROM THE BOARD OF DIRECTORS

(d) there is no other information that needs to be disclosed pursuant to any of the requirements as set out in Rule 17.50(2) of the GEM Listing Rules; and
(e) the Company is not aware of any other matter that needs to be brought to the attention of the Shareholders and the Stock Exchange in relation to the re-election of Directors.

GENERAL INFORMATION

The notice for the Annual General Meeting has been set out on pages 38 to 43 of this circular.

Whether or not you intend to attend the Annual General Meeting in person, you are requested to complete and return the accompanying proxy form to the Company's branch share registrar in Hong Kong, Tricor Investor Services Limited at 17 Floor, Far East Finance Centre, 16 Harcourt Road, Hong Kong, in accordance with the instructions printed thereon not less than 48 hours (i.e. 10:00 a.m. on Tuesday, 3 June 2025) before the time appointed for holding the Annual General Meeting or any adjournment thereof. The return of the proxy form will not preclude you from attending and voting in person if you so wish and in such event, the form of proxy previously submitted shall be deemed to be revoked.

VOTING BY POLL

Pursuant to Rule 17.47(4) of the GEM Listing Rules, all votes of Shareholders at the Annual General Meeting must be taken by way of poll and the Company will announce the results of the poll in the manner as prescribed under Rule 17.47(5) of the GEM Listing Rules.

RECOMMENDATION

The Directors consider that the general mandates to issue and repurchase Shares, the amendments to the Memorandum and Articles of Association, the adoption of the New Memorandum and Articles of Association and the re-election of Directors proposed are in the interest of the Company and so recommend you to vote in favour of the relevant resolutions at the forthcoming Annual General Meeting.

Yours faithfully,

By order of the Board

Directel Holdings Limited

Li Kin Shing

Chairman

APPENDIX I

EXPLANATORY STATEMENT

This is an explanatory statement given to all Shareholders of the Company, as required by the GEM Listing Rules, to provide requisite information of the Repurchase Mandate.

1. GEM LISTING RULES FOR REPURCHASES OF SHARES

The GEM Listing Rules permit companies whose primary listing is on the Stock Exchange to repurchase their fully-paid Shares on GEM subject to certain restrictions, the more important of which are summarised below:

(a) Shareholders' approval

All proposed repurchase of securities on the Stock Exchange by a company with primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, either by way of general mandate or by special approval of a particular transaction.

(b) Share capital

Under the Repurchase Mandate, the number of Shares that the Company may repurchase shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company at the date of the passing of the relevant resolutions. The Company's authority is restricted to purchases made on GEM in accordance with the GEM Listing Rules. As at the Latest Practicable Date, there were in issue an aggregate of 244,875,000 Shares. Exercise in full of the Repurchase Mandate, on the basis that no further Shares would be issued or repurchased prior to the date of the Annual General Meeting, would accordingly result in up to 24,487,500 Shares being repurchased by the Company. It is the intention of the Company that if the Company repurchases any Shares pursuant to the Repurchase Mandate, the Company will cancel the Shares so repurchased.

(c) Reasons for repurchase

The Directors have no present intention to repurchase any Shares but consider that the Repurchase Mandate will provide the Company with the flexibility to make such repurchase as and when appropriate and is beneficial to the Company. Such repurchases may, depending on the market conditions and funding arrangements at the time, lead to an enhancement of the net asset value of the Company and its assets and/or its earnings per Share. As compared with the position of the Company in its financial statements for the year ended 31 December 2024 (being the most recent published audited accounts), the Directors consider that there would not be any material adverse impact on the working capital and on the gearing position of the Company in the event that the proposed repurchases were to be made in full during the proposed repurchase period. However, the Directors will 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 on its gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

APPENDIX I

EXPLANATORY STATEMENT

(d) Funding of repurchases

Repurchase of the Shares will be funded out of funds legally available for such purpose in accordance with the Memorandum and Articles of Association and the applicable laws of the Cayman Islands. The Company is empowered by its Memorandum and Articles of Association to repurchase its Shares. Cayman Islands law provides that the amount of capital repaid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant shares, or the profits that would otherwise be available for distribution by way of dividend or the proceeds of a new issue of shares made for such purpose. The amount of premium payable on repurchase may only be paid out of either the profits that would otherwise be available for distribution by way of dividend or out of the share premium of the Company. Under Cayman Islands law, the repurchased Shares will remain part of the authorised but unissued share capital.

(e) Connected persons

None of the Directors nor, to the best of the knowledge and belief of the Directors having made all reasonable enquiries, any of the close associates (as defined in the GEM Listing Rules) of any of the Directors has any present intention, in the event that the proposed Repurchase Mandate is approved by the Company's Shareholders, to sell Shares to the Company. As at the Latest Practicable Date, no core connected person (as defined in the GEM Listing Rules) of the Company has notified the Company that he/she has a present intention to sell Shares to the Company nor has he/she undertaken not to sell any of the Shares held by him/her to the Company in the event that the Company is authorised to make repurchases of Shares.

(f) Undertaking of the Directors

The Directors will exercise the powers of the Company to make repurchases pursuant to the Repurchase Mandate in accordance with the GEM Listing Rules and applicable laws of the Cayman Islands, and in accordance with the regulations set out in the Memorandum and Articles of Association of the Company. Neither this explanatory statement nor the Repurchase Mandate has any unusual features.

(g) Effect of Takeovers Code and minimum public float

If as a result of a repurchase of Shares, a Shareholder's proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purpose of Rule 32 of the Takeovers Code. As a result, a Shareholder, or a group of Shareholders acting in concert (within the meaning under the Takeovers Code), depending on the level of increase in the Shareholder's interests, could obtain or consolidate control of the Company and become(s) obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

APPENDIX I

EXPLANATORY STATEMENT

As at the Latest Practicable Date, the register of the Shareholders maintained by the Company pursuant to Section 336 under Part XV of the SFO showed that the Company has been notified of the following interests, being 5% or more of the Company’s issued share capital:

Name of Shareholders	Number of Shares held	Approximate percentage of existing shareholding	Approximate percentage of shareholding if the Repurchase Mandate is exercised in full
Mr. Li Kin Shing (Note 1)	169,500,000	69.22%	76.91%
Ms. Kwok King Wa (Note 2)	169,500,000	69.22%	76.91%
New Everich Holdings Limited (Note 3)	104,437,500	42.65%	47.39%
Golden Brand Holdings Limited (Note 4)	16,500,000	6.74%	7.49%
Mr. Bai Zhifeng (Note 5)	16,500,000	6.74%	7.49%

Notes:

Among the 169,500,000 Shares, 104,437,500 Shares are owned by New Everich Holdings Limited which is owned as to 54% and 46% by Mr. Li Kin Shing and Ms. Kwok King Wa respectively. Mr. Li Kin Shing is the spouse of Ms. Kwok King Wa. Accordingly, Mr. Li Kin Shing is deemed to be interested in the 104,437,500 Shares under the SFO.
Among the 169,500,000 Shares, 65,062,500 Shares are owned by Mr. Li Kin Shing and 104,437,500 Shares are owned by New Everich Holdings Limited which is owned as to 54% and 46% by Mr. Li Kin Shing and Ms. Kwok King Wa respectively. Ms. Kwok King Wa is the spouse of Mr. Li Kin Shing. Accordingly, Ms. Kwok King Wa is deemed to be interested in the 65,062,500 Shares and 104,437,500 Shares held by Mr. Li Kin Shing and New Everich Holdings Limited respectively under the SFO.
These Shares are beneficially owned by New Everich Holdings Limited.
These Shares are beneficially owned by Golden Brand Holdings Limited.
The 16,500,000 Shares are owned by Golden Brand Holdings Limited which is wholly owned by Mr. Bai Zhifeng.

In the event that the Directors shall exercise in full the Repurchase Mandate, the total interests of the above Shareholders would be increased to approximately the respective percentages shown in the last column above and such increase will not give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code.

APPENDIX I

EXPLANATORY STATEMENT

Assuming that there is no issue of Shares in the Company between the Latest Practicable Date and the date of a repurchase, an exercise of the Repurchase Mandate in whole will result in less than the relevant prescribed minimum percentage of the Shares of the Company being held by the public as required by the Stock Exchange. The Directors confirm that the Repurchase Mandate will not be exercised to the extent as may result in a public shareholding of less than such prescribed minimum percentage.

2. SHARE PURCHASE MADE BY THE COMPANY

The Company had not repurchased any of the Shares (whether on GEM or otherwise) during the previous six months immediately preceding the Latest Practicable Date.

3. SHARE PRICES

During each of the 12 months immediately preceding the Latest Practicable Date, the highest and lowest traded prices for Shares on GEM were as follows:

	Price Per Share
	Highest HK$	Lowest HK$
Month
2024
March	0.191	0.113
April	0.169	0.101
May	0.112	0.098
June	0.100	0.090
July	0.091	0.091
August	0.091	0.080
September	0.080	0.052
October	0.096	0.071
November	0.092	0.089
December	0.112	0.073
2025
January	0.088	0.073
February	0.074	0.070
March	0.071	0.070
April (up to the Latest Practicable Date)	0.160	0.071

APPENDIX II