First Service Holding Limited - Proxy Solicitation & Information Statement 2004

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss however arising from or in reliance upon the whole or any part of the contents of this circular.

萬裕國際集團有限公司[] *MAN YUE INTERNATIONAL HOLDINGS LIMITED**

(Incorporated in Bermuda with limited liability)

(Stock code: 894)

Executive Directors: CHAN Ho Sing (Chairman) KO Pak On

Independent Non-executive Directors: LI Sau Hung Eddy LO Kwok Kwei David

Registered Office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Head Office and Principal Place of Business: 16th Floor Yiko Industrial Building 10 Ka Yip Street Chai Wan Hong Kong 27th April 2004

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATES FOR THE ISSUE OF NEW SHARES AND THE REPURCHASE BY THE COMPANY OF ITS OWN SHARES, AMENDMENTS TO THE BYE-LAWS OF THE COMPANY AND RE-ELECTION OF DIRECTOR

GENERAL MANDATE TO ISSUE NEW SHARES

Approval is being sought from the shareholders of Man Yue International Holdings Limited (the “Company”) at its Annual General Meeting to be held on 24th May 2004 (the “Annual General Meeting”) to grant a general mandate to the directors of the Company (the “Directors”) to allot, issue and deal with new shares of HK$0.10 each (the “Shares”) up to an aggregate of 20 per cent of its existing issued share capital as at the date of the passing of the relevant resolution (the “General Mandate”). The obtaining of such a mandate is in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”). The Directors wish to state that they have no immediate plan to allot, issue or deal with any new Shares of the Company.

* for identification purpose only

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By a separate resolution, it will be proposed that any Share repurchased by the Company following the granting of the Buyback Mandate (as defined below) will be added to the total number of shares which may be issued under the General Mandate.

The General Mandate will continue in force until the earliest of the conclusion of the next annual general meeting of the Company, the expiration of the period within which the next annual general meeting is required to be held by law or the bye-laws of the Company (the “Bye-laws”), or the revocation or variation of the General Mandate by ordinary resolution of the shareholders of the Company in general meeting prior to the next annual general meeting.

BUYBACK MANDATE

The Listing Rules permit companies with a primary listing on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) to repurchase their own securities, subject to certain restrictions, on the Stock Exchange. At the Annual General Meeting, a resolution will be proposed to grant the Directors a general mandate to, inter alia, repurchase up to 10 per cent of the issued and fully-paid share capital of the Company as at the date of the passing of the relevant resolution (the “Buyback Mandate”). The Buyback Mandate will continue in force until the earliest of the conclusion of the next annual general meeting, the expiration of the period within which the next annual general meeting is required to be held by law or the Bye-laws or the revocation or variation of the Buyback Mandate by ordinary resolution of the shareholders of the Company in general meeting prior to the next annual general meeting. The Company is required by the relevant rules set out in the Listing Rules regulating such share repurchases (the “Share Buy Back Rules”) to send to its shareholders an explanatory statement containing all the information reasonably necessary to enable them to make an informed decision on whether to vote for or against the granting of the Buyback Mandate. Such information is provided below.

(i) Listing Rules

The Listing Rules permit companies whose primary listings are on the Stock Exchange to repurchase their fully paid-up securities on the Stock Exchange subject to certain restrictions.

(ii) Exercise of the Buyback Mandate

Exercise in full of the Buyback Mandate, assuming that no further Share will be issued and repurchased prior to the Annual General Meeting, and based on 373,440,000 fully-paid Shares in issue as at 26th April 2004 (the latest practicable date prior to the printing of this circular), could accordingly result in up to 37,344,000 Shares being repurchased by the Company during the period from the passing of the resolution granting the Buyback Mandate until the conclusion of the next annual general meeting of the Company or when such Buyback Mandate is revoked or varied by ordinary resolution of the shareholders of the Company in general meeting, or the expiration of the period within which the next annual general meeting is required by law or the Bye-laws to be held, whichever occurs first.

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(iii) Reasons for repurchase

The Directors believe that it is in the best interests of the Company and its shareholders to have a general authority from the shareholders to enable the Directors on behalf of the Company to repurchase the fully-paid Shares in the market. 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/or its earnings per Share and will only be made when the Directors believe that such repurchases will benefit the Company and its shareholders.

(iv) Funding of repurchase

In repurchasing shares, the Company may only apply funds legally available for such purpose in accordance with its memorandum of association and bye-laws and the laws of Bermuda. It is envisaged that the funds required for any repurchase would be derived from the distributable profits of the Company. In the event that any repurchase will or will be likely to have an adverse impact on the working capital of the Company, the Company will not proceed with such repurchase.

There may be an adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited accounts of the Company for the financial year ended 31st December 2003 as contained in the Annual Report 2003) in the event that the proposed share repurchases were to be carried out in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Buyback Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital of the Company or its gearing level which in the opinion of the Directors is from time to time appropriate for the Company.

(v) General

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, their respective associates, has any present intention, if the Buyback Mandate is approved by the shareholders of the Company, to sell any Shares to the Company or its subsidiaries.

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

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

If as a result of a share repurchase, a shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of the Hong Kong Code on Takeovers and Mergers (the “Takeovers Code”) currently in force and issued by the Securities and Futures Commission of Hong Kong. As a result, a shareholder, or group of shareholders acting in concert, could obtain or consolidate control of the Company and becomes obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

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As at 26th April 2004 (being the latest practicable date prior to the printing of this circular), Man Yue Holdings Inc. was the holder of 179,734,000 Shares of the Company representing approximately 48.1 per cent of the issued share capital of the Company. Man Yue Holdings Inc. is a company incorporated in the Bahamas, the entire issued capital of which is ultimately beneficially owned by the family trust of Mr. Chan Ho Sing (the Chairman of the Company).

If the Company exercises in full the Buyback Mandate, the shareholding of Man Yue Holdings Inc. in the issued share capital of the Company will increase from approximately 48.1 per cent to approximately 53.5 per cent. The Directors are aware of the implications under the Takeovers Code which may arise as a result of the repurchase pursuant to the Buyback Mandate. However, the Company has no intention to repurchase Shares to such an extent which will trigger an obligation to make a mandatory offer under Rule 26 of the Takeovers Code.

If as a result of the exercise of the power to repurchase Shares pursuant to the Buyback Mandate, the number of listed Shares which are in the hands of the public falls below the prescribed minimum of 25 per cent as required by the Stock Exchange, the Company will not exercise the power to repurchase shares. The Company has no intention to exercise repurchases to such extent that public float is reduced to below 25 per cent.

The Company has not repurchased any securities of the Company (on the Stock Exchange or otherwise) in the six months prior to 26th April 2004 (being the latest practicable date prior to the printing of this circular).

(vi) Share prices

The highest and lowest prices at which the Shares have traded on the Stock Exchange during each of the twelve months preceding 26th April 2004 (being the latest practicable date prior to the printing of this circular) were as follows:

	Highest	Lowest
	HK$	HK$
2003
month
April	0.210	0.178
May	0.180	0.148
June	0.198	0.170
July	0.370	0.184
August	0.238	0.210
September	0.350	0.202
October	0.320	0.265
November	0.315	0.275
December	0.315	0.250
2004
month
January	0.320	0.275
February	0.310	0.250
March	0.330	0.300

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AMENDMENT TO THE BYE-LAWS

Following the recent amendments to the Listing Rules and to be in line with the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) (“SFO”) and the current laws, rules and regulations of Bermuda, the Directors recommend making corresponding amendments and updates to the Bye-laws. Details of the proposed changes are set out in the notice of the Annual General Meeting which is being sent to the shareholders together with this circular.

The major amendments to the Bye-laws are summarised as follows:

(a) the new definition of “clearing house” is proposed to be adopted following the enactment of the SFO on 1st April 2003 (please see item 8(a) of the notice of the Annual General Meeting);
(b) the Bye-laws are amended to clarify that where the use of share premium is expressly permitted under the Companies Act 1981 of Bermuda (the “Companies Act”), no special resolution would be required (please see item 8(c) of the notice of the Annual General Meeting);
(c) the Bye-laws are amended to reflect that where the Company purchases for redemption a redeemable share, purchases not made through the market or by tender shall be limited to a maximum price as may from time to time be determined by the Company in general meeting, and if purchases are made by tender, tenders shall be available to all shareholders of the Company alike. Such amendment reflects the relevant requirement as set out in paragraph 8 of Appendix 3 of the Listing Rules (please see item 8(d) of the notice of the Annual General Meeting);
(d) the Bye-laws are amended to reflect changes to section 65(1) of the Companies Act in 2002 which now provides that the register of members of a Bermuda company need only reflect the amount paid or agreed to be considered as paid on the shares if such shares are not fully-paid (please see item 8(h) of the notice of the Annual General Meeting);
(e) the Bye-laws are amended to clarify that each proxy appointed by a shareholder which is a clearing house shall have one vote on a show of hands (please see item 8(o) of the notice of the Annual General Meeting);
(f) the Bye-laws are amended to elaborate on and clarify the circumstances under which the Company is permitted to destroy certain documents (please see item 8(y) of the notice of the Annual General Meeting);
(g) the Bye-laws are amended to clarify that resignation of a director can be effected by serving a resignation letter signed by the relevant director to the Company or tendering such letter at a board meeting. Board resolution is only required to note (but not approve) the resignation of the director (please see item 8(u) of the notice of the Annual General Meeting);

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(h) the Bye-laws are amended to reflect the annual results announcement publication requirements as set out in the Listing Rules (please see items 8(aa) and 8(bb) of the notice of the Annual General Meeting);
(i) the Bye-laws are amended to reflect the requirement under section 89(3) of the Companies Act (amended in 1998) that no person other than an incumbent auditor shall be capable of being appointed auditor at an annual general meeting unless notice in writing of an intention to nominate that person to the office of auditor has been given not less than 21 days before the annual general meeting (please see item 8(cc) of the notice of the Annual General Meeting);
(j) the Bye-laws are amended to enable the Company to send corporate communication to its shareholders by electronic means pursuant to Rule 2.07A of the Listing Rules (please see items 8(b), 8(dd), 8(ee) and 8(ff) of the notice of the Annual General Meeting);
(k) the Bye-laws are amended to enable the Company to send corporate communication in English or Chinese only to its shareholders pursuant to Rule 2.07B of the Listing Rules (please see item 8(ee) of the notice of the Annual General Meeting);
(l) the Bye-laws are also amended to reflect the recent amendments to Appendices 3 and 13 of the Listing Rules as follows:
a minimum seven-day period must be allowed for lodgement by shareholders of a notice to nominate a Director and such period shall commence no earlier than the day after the despatch of the notice of the meeting appointed for such election and end no later than seven days before the date of such meeting (please see item 8(t) of the notice of the Annual General Meeting);
Directors shall abstain from voting at the board meeting on any matter in which he or any of his associates has a material interest and are not to be counted towards the quorum of the relevant board meeting (please see item 8(a) and 8(w) of the notice of the Annual General Meeting);
where any shareholder is, under the Listing Rules, required to abstain from voting on any particular resolution or restricted to voting only for or only against any particular resolution, any votes cast by or on behalf of such shareholder in contravention of such requirement or restriction shall not be counted (please see item 8(q) of the notice of the Annual General Meeting); and
a member which is a clearing house or its nominee is allowed to appoint multiple corporate representatives to attend and vote at a meeting of the Company as if each were an individual shareholder (please see item 8(r) of the notice of the Annual General Meeting).

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Details of the proposed amendments (including the tidying up amendments not described above) to the Bye-laws are set out in the notice of the Annual General Meeting.

RIGHT TO DEMAND A POLL

Pursuant to existing bye-law 66 of the Bye-laws, a resolution put to the vote of a general meeting shall be decided on a show of hands unless (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded:

(a) by the Chairman of the meeting; or
(b) by at least three shareholders present in person (or in the case of a shareholder being a corporation by its duly authorized representative) or by proxy for the time being entitled to vote at the meeting; or
(c) by any shareholder or shareholders present in person (or in the case of a shareholder being a corporation by its duly authorized representative) or by proxy and representing not less than one-tenth of the total voting rights of all shareholders having the right to attend and vote at the meeting; or
(d) by a shareholder or shareholders present in person (or in the case of a shareholder being a corporation by its duly authorized representative) or by proxy and holding Shares conferring a right to vote at the meeting being Shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all Shares conferring that right.

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

RE-ELECTION OF DIRECTOR

One-third of the Directors, except the Chairman, are subject to retirement by rotation pursuant to the Bye-laws. As set out in item 3 in the notice of the Annual General Meeting regarding re-election of Director, Mr. Ko Pak On (“Mr. Ko”) will retire at the Annual General Meeting by rotation and, being eligible, offer himself for re-election.

Aged 57, Mr. Ko is an executive Director of the Company and is responsible for the manufacturing operations of the Group in Dongguan, the PRC. Mr. Ko joined the Group in 1984 and has over 30 years’ experience in the electronics industry. Other than holding of directorship in the Company, Mr. Ko is also the director of subsidiaries of the Group as follows:

Man Yue Holdings (BVI) Limited, Johnstone International Limited, Man Yue Electronics Company Limited, Samxon Electronics (Dongguan) Company Limited, Wuxi Heli Electronic Company Limited, Dongguan Ostor-Samxon Electronics Company Limited, Samxon Electronic Components Limited, E-World Development Limited, Man Fat International Trading (Shanghai) Company Limited, Man Yue Electronics (Xiamen) Company Limited, Man Yue Technology Limited, MMS Logistics Company Limited, Searange Investment Limited, TradeUNIT Limited, Wuxi Man Yue Electronics Company Limited, Splendid Skill Holdings Limited, and Accord Advance Limited.

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As at the Latest Practicable Date, the interests and short positions of Mr. Ko in the shares, underlying shares and debentures of the Company or any associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance (“SFO”)) as recorded in the register to be kept by the Company pursuant to section 352 of the SFO or otherwise notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies were as follows:

Long positions in the Shares

Number	Capacity	Percentage of issued share capital
400,000	Personal interest	0.11%

Long position in the underlying Shares pursuant to the share option scheme of the Company

Number of Shares			Exercise price
under options	Date of grant	Exercise period	per Share
1,500,000	30 December 1997	30 December 1997	HK$0.7856
		to 12 February 2007
300,000	5 June 2000	5 June 2000	HK$0.432
		to 12 February 2007

Mr. Ko as an executive director has entered into a service contract on 17 January 2004 with the Company for a term of three years from 1 January 2004 pursuant to which Mr. Ko is entitled to an annual emoluments of HK$702,000. The basis of determination of his emoluments is by reference to market terms, and performance, qualification and experience of Mr. Ko. Mr. Ko may be entitled to discretionary bonus by reference to the annual result of the Company and the performance of the individual subject to the approval by the board of directors. Moreover, Mr. Ko is not related to any other directors, senior management or substantial or controlling shareholders of the Company.

RECOMMENDATION

The Directors consider that the General Mandate and the Buyback Mandate and the proposed amendments to the Bye-laws are in the best interests of the Company and its shareholders and accordingly recommend that all shareholders should vote in favour of the relevant ordinary resolutions and the special resolution to be proposed at the Annual General Meeting.

Yours faithfully For and on behalf of

Man Yue International Holdings Limited CHAN Ho Sing Chairman

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NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Man Yue International Holdings Limited (the “Company”) will be held at 16th Floor, Yiko Industrial Building, 10 Ka Yip Street, Chai Wan, Hong Kong on Monday, 24th May 2004 at 3:00 p.m. for the following purposes:

To receive and consider the audited accounts and the reports of the directors and auditors for the year ended 31st December 2003;
To re-elect Mr. KO Pak On as executive Director;
To authorise the board of directors to fix the remuneration of the directors of the Company;
To fix the maximum number of Directors at 10;
To authorise the board of directors to appoint additional directors up to the maximum fixed by the shareholders of the Company;
To re-appoint Messrs. Ernst & Young as auditors and authorise the board of directors to fix their remuneration;
As special business to consider, and if thought fit, pass the following resolutions as Ordinary Resolutions:

“ A. THAT:

(i) subject to paragraph A(iii) below and pursuant to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, the exercise by the directors of the Company during the Relevant Period (as defined below) of all the powers of the Company to issue, allot and deal with additional shares in the capital of the Company and to make or grant offers, agreements and options which might require the exercise of such powers be and is hereby generally and unconditionally approved;
(ii) the approval in paragraph A(i) above shall be in addition to any other authorization given to the directors of the Company and shall authorize the directors of the Company during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such power after the end of the Relevant Period;
(iii) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the directors of the Company pursuant to the approval in paragraph A(i) above, otherwise than pursuant to (a) a Rights Issue (as defined below), (b) the exercise of options granted under the Share Option Scheme (as defined below) or (c) any scrip dividend scheme or similar arrangements, shall not exceed 20% of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution and the authority pursuant to paragraph A(i) above shall be limited accordingly; and

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(iv) for the purposes of this resolution:

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

(a) the conclusion of the next annual general meeting of the Company;
(b) the expiration of the period within which the next annual general meeting of the Company is required by Bermuda law or the Company’s bye-laws to be held; and
(c) the time at which the authority set out in this resolution is revoked or varied by way of ordinary resolution of the shareholders of the Company in general meeting.

“Rights Issue” means an offer of shares in the capital of the Company open for a period fixed by the directors of the Company to holders of shares in the Company whose names appear on the register of members of the Company on a fixed record date in proportion to their then holdings of such shares, subject to such exclusion or other arrangements as the directors of the Company may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of or the requirements of any recognised regulatory body or any stock exchange in any territory applicable to the Company.

“Share Option Scheme” means the employee share option scheme adopted by the Company on 13th February 1997 pursuant to which the Company may grant to employees of the Company and its subsidiaries options to subscribe for shares in the capital of the Company.

B. THAT:

(i) subject to paragraph B(iii) below, the exercise by the directors of the Company during the Relevant Period (as defined below) of all the powers of the Company to repurchase its own issued shares on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the shares of the Company may be listed and recognised by the Securities and Futures Commission of Hong Kong and the Stock Exchange for this purpose on the terms and subject to the conditions set out in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited or any applicable laws and requirements of any other stock exchange as amended from time to time be and is hereby generally and unconditionally approved;
(ii) the approval in paragraph B(i) above shall be in addition to any other authorisation given to the directions of the Company;

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(iii) the aggregate nominal amount of the shares repurchased or agreed conditionally or unconditionally to be repurchased by the Company pursuant to the approval in paragraph B(i) above shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution and the authority pursuant to paragraph B(i) above shall be limited accordingly; and
(iv) for the purpose of this resolution:

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

(a) the conclusion of the next annual general meeting of the Company;
(b) the expiration of the period within which the next annual general meeting of the Company is required by Bermuda law or the Company’s bye-laws to be held; and
(c) the time at which the authority set out in this resolution is revoked or varied by the shareholders of the Company by way of ordinary resolution in general meeting.

C. THAT:

Conditional upon the passing of resolutions numbered 7A and 7B set out above, the aggregate nominal amount of the number of shares which are repurchased by the Company under the authority granted to the directors of the Company in the said resolution numbered 7B shall be added to the aggregate nominal amount of the issued share capital of the Company that may be allotted or agreed conditionally or unconditionally to be allotted by the directors of the Company pursuant to the said resolution numbered 7A provided that such added amount shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue at the date of passing this resolution.”

As special business, to consider and, if thought fit, pass the following resolution as a Special Resolution:

THAT the Bye-laws of the Company be and are hereby amended in the following manner:

(a) Bye-law 1

By deleting the existing definitions of “clearing house” and “Newspaper” in existing Byelaw 1 and inserting the following new definitions in existing Bye-law 1:

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

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“clearing house” a clearing house recognised by the laws of the jurisdiction in which the shares of the Company are listed or quoted on a stock exchange in such jurisdiction.”

(b) Bye-law 2

(i) By deleting the existing Bye-law 2(e) in its entirety and substituting therefor the following new Bye-law 2(e):
“(e) expressions referring to writing shall, unless the contrary intention appears, be construed as including printing, lithography, photography and other modes of representing words or figures in a visible form, and including where the representation takes the form of electronic display, provided that both the mode of service of the relevant document or notice and the Member’s election comply with all applicable Statutes, rules and regulations;”
(ii) By deleting the full-stop at the end of the existing Bye-law 2(j) and replacing therewith a semicolon and the word “and”, and inserting the following paragraph as new Byelaw 2(k):
“(k) references to a document being executed include references to it being executed under hand or under seal or by electronic signature or by any other method and references to a notice or document include a notice or document recorded or stored in any digital, electronic, electrical, magnetic or other retrievable form or medium and information in visible form whether having physical substance or not.”

(c) Bye-law 6

By inserting the words “, save for the use of share premium as expressly permitted by the Act,” after the words “issued share capital or” in, and deleting the words “in any manner permitted by law” from, existing Bye-law 6.

(d) Bye-law 9

By deleting the existing Bye-law 9 in its entirety and substituting therefor the following new Bye-law 9:

“9. Subject to Sections 42 and 43 of the Act, these Bye-laws, and to any special rights conferred on the holders of any shares or attaching to any class of shares, any preference shares may be issued or converted into shares that, at a determinable date or at the option of the Company or the holder if so authorised by its memorandum of association, are liable to be redeemed on such terms and in such manner as the Company before the issue or conversion may by ordinary resolution of the Members determine. Where the Company purchases for redemption a redeemable share, purchases not made through the market or by tender shall be limited to a maximum

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price as may from time to time be determined by the Company in general meeting, either generally or with regard to specific purchases. If purchases are by tender, tenders shall be available to all Members alike.”

(e) Bye-law 12

(i) By deleting the existing Bye-law 12(1) in its entirety and substituting therefor the following new Bye-law 12(1):
“12.(1) Subject to the Act, these Bye-laws, any direction that may be given by the Company in general meeting and, where applicable, the rules of any Designated Stock Exchange and without prejudice to any special rights or restrictions for the time being attached to any shares or any class of shares, the unissued shares of the Company (whether forming part of the original or any increased capital) shall be at the disposal of the Board, which may offer, allot, grant options over or otherwise dispose of them to such persons, at such times and for such consideration and upon such terms and conditions as the Board may in its absolute discretion determine but so that no shares shall be issued at a discount. Neither the Company nor the Board shall be obliged, when making or granting any allotment of, offer of, option over or disposal of shares, to make, or make available, any such offer, option or shares to Members or others with registered addresses in any particular territory or territories being a territory or territories where, in the absence of a registration statement or other special formalities, this would or might, in the opinion of the Board, be unlawful or impracticable. Members affected as a result of the foregoing sentence shall not be, or be deemed to be, a separate class of members for any purpose whatsoever.”
(ii) By deleting the existing Bye-law 12(3) in its entirety.

(f) Bye-law 18

By deleting the words “a sum equal to the relevant maximum amount as the Designated Stock Exchange may from time to time determine or such lesser sum” in existing Bye-law 18 and replacing therewith the words “such reasonable out-of-pocket expenses”.

(g) Bye-law 25

(i) By re-numbering existing Bye-law 25(1) as Bye-law 25;
(ii) By deleting the existing Bye-law 25(2) in its entirety.

(h) Bye-law 43

By inserting the words “, in respect of any shares that are not fully paid,” after the words “held by him and” in existing Bye-law 43(1)(a).

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(i) Bye-law 44

(i) By deleting the words “the Newspapers” in the second sentence of existing Bye-law 44 and replacing therewith the words “any other newspapers”;
(ii) By inserting the words “or by any means in such manner as may be accepted by the Designated Stock Exchange” after the words “Designated Stock Exchange” in existing Bye-law 44.

(j) Bye-law 46

By inserting the words “a form prescribed by the Designated Stock Exchange or in” after the words “or common form or in” in existing Bye-law 46.

(k) Bye-law 51

By deleting the existing Bye-law 51 in its entirety and replacing therewith the following new Bye-law 51:

“51. The registration of transfers of shares or of any class of shares may, after notice has been given by advertisement in an appointed newspaper and, where applicable, any other newspapers in accordance with the requirements of any Designated Stock Exchange or by any means in such manner as may be accepted by the Designated Stock Exchange to that effect be suspended at such times and for such periods (not exceeding in the whole thirty (30) days in any year) as the Board may determine.”

(l) Bye-law 55

By deleting the words “the Newspapers” and replacing therewith the word “newspapers” in existing Bye-law 55(2)(c).

(m) Bye-law 61

By inserting the words “other than the appointment of a chairman of a meeting” after the words “No business” in existing Bye-law 61(2).

(n) Bye-law 63

By inserting the words “in person (or in the case of a Member being a corporation, by its duly authorised representative) or by proxy” after the words “the Members present” in the last sentence of existing Bye-law 63.

(o) Bye-law 66

By inserting the following as the second sentence of existing Bye-law 66:

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“Notwithstanding anything contained in these Bye-laws, where more than one proxy is appointed by a Member which is a clearing house (or its nominee(s)), each such proxy shall have one vote on a show of hands.”

(p) Bye-law 75

By deleting the words “such Member” after the words “any may otherwise act and be treated as” and replacing therewith the words “if he were the registered holder of such shares” in existing Bye-law 75.

(q) Bye-law 76

(i) By re-numbering existing Bye-law 76 as Bye-law 76(1);
(ii) By inserting the following as new Bye-law 76(2):
“(2) Where any Member is, under the rules of the Designated Stock Exchange, required to abstain from voting on any particular resolution or restricted to voting only for or only against any particular resolution, any votes cast by or on behalf of such Member in contravention of such requirement or restriction shall not be counted.”

(r) Bye-law 84(2)

By deleting the existing Bye-law 84(2) in its entirety and replacing therewith the following new Bye-law 84(2):

“(2) Where a Member is a clearing house (or its nominee(s) and, in each case, being a corporation), it may authorise such persons as it thinks fit to act as its representatives at any meeting of the Company or at any meeting of any class of Members provided that the authorisation shall specify the number and class of shares in respect of which each such representative is so authorised. Each person so authorised under the provisions of this Bye-law shall be deemed to have been duly authorised without further evidence of the facts and be entitled to exercise the same rights and powers on behalf of the clearing house (or its nominee(s)) as if such person was the registered holder of the shares of the Company held by the clearing house (or its nominee(s)) in respect of the number and class of shares specified in the relevant authorisation including the right to vote individually on a show of hands.”

(s) Bye-law 86(1)

By inserting the words “at the annual general meeting” before, and the words “or at any special general meeting” after, the words “in accordance with Bye-law 87” in existing Byelaw 86(1).

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(t) Bye-law 88

By deleting the words “not less than seven (7) days before the date appointed for the meeting there shall have been lodged at the Office or at the head office” in existing Bye-law 88 and inserting the following proviso at the end of existing Bye-law 88:

“shall have been lodged at the head office or at the Registration Office provided that the minimum length of the period, during which such Notice(s) are given, shall be at least seven (7) days and that the period for lodgment of such Notice(s) shall commence no earlier than the day after the dispatch of the notice of the general meeting appointed for such election and end no later than seven (7) days prior to the date of such general meeting.”

(u) Bye-law 89A

By deleting the words “whereupon the Board resolves to accept such resignation” from existing Bye-law 89A(1).

(v) Bye-law 100

By deleting the existing Bye-law 100(d) in its entirety.

(w) Bye-law 103

By deleting the existing Bye-law 103 in its entirety and replacing therewith the following new Bye-law 103:

“103. (1) A Director shall not vote (nor be counted in the quorum) on any resolution of the Board approving any contract or arrangement or any other proposal in which he or any of his associates is materially interested, but this prohibition shall not apply to any of the following matters namely:
(i) any contract or arrangement for the giving to such Director or his associate(s) any security or indemnity in respect of money lent by him or any of his associates or obligations incurred or undertaken by him or any of his associates at the request of or for the benefit of the Company or any of its subsidiaries;
(ii) any contract or arrangement for the giving of any security or indemnity to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director or his associate(s) has himself/ themselves assumed responsibility in whole or in part whether alone or jointly under a guarantee or indemnity or by the giving of security;

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(iii) any contract or arrangement concerning an offer of shares or debentures or other securities of or by the Company or any other company which the Company may promote or be interested in for subscription or purchase, where the Director or his associate(s) is/are or is/are to be interested as a participant in the underwriting or sub-underwriting of the offer;
(iv) any contract or arrangement in which the Director or his associate(s) is/ are interested in the same manner as other holders of shares or debentures or other securities of the Company or any of its subsidiaries by virtue only of his/their interest in shares or debentures or other securities of the Company;
(v) any contract or arrangement concerning any other company in which the Director or his associate(s) is/are interested only, whether directly or indirectly, as an officer or executive or a shareholder other than a company in which the Director and/or his associate(s) is/are beneficially interested in five (5) per cent. or more of the issued shares or of the voting rights of any class of shares of such company (or any third company through which his interest or that of any of his associates is derived); or
(vi) any proposal concerning the adoption, modification or operation of a share option scheme, a pension fund or retirement, death or disability benefits scheme or other arrangement which relates both to directors, his associates and employees of the Company or of any of its subsidiaries and does not provide in respect of any Director, or his associate(s), as such any privilege or advantage not accorded to the employees to which such scheme or fund relates.
(2) A company shall be deemed to be a company in which a Director and/or his associate(s) owns five (5) per cent. or more if and so long as (but only if and so long as) he and/or his associates, (either directly or indirectly) are the holders of or beneficially interested in five (5) per cent. or more of any class of the equity share capital of such company or of the voting rights available to members of such company (or of any third company through which his/their interest or that of any of his associates is derived). For the purpose of this paragraph there shall be disregarded any shares held by a Director or his associate(s) as bare or custodian trustee and in which he or any of them has no beneficial interest, any shares comprised in a trust in which the interest of the Director or his associate(s) is/are in reversion or remainder if and so long as some other person is entitled to receive the income thereof, and any shares comprised in an authorised unit trust scheme in which the Director or his associate(s) is/are interested only as a unit holder and any shares which carry no voting right at general meetings and very restrictive dividend and return of capital right.

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(3) Where a company in which a Director and/or his associate(s) holds five (5) per cent. or more is materially interested in a transaction, then that Director and/or his associate(s) shall also be deemed materially interested in such transaction.
(4) If any question shall arise at any meeting of the Board as to the materiality of the interest of a Director (other than the chairman of the meeting) or his associate(s) or as to the entitlement of any Director (other than such chairman) to vote and such question is not resolved by his voluntarily agreeing to abstain from voting, such question shall be referred to the chairman of the meeting and his ruling in relation to such other Director shall be final and conclusive except in a case where the nature or extent of the interest of the Director and/or his associate(s) concerned as known to such Director has not been fairly disclosed to the Board. If any question as aforesaid shall arise in respect of the chairman of the meeting such question shall be decided by a resolution of the Board (for which purpose such chairman shall not vote thereon) and such resolution shall be final and conclusive except in a case where the nature or extent of the interest of such chairman as known to such chairman has not been fairly disclosed to the Board.”

(x) Bye-law 122

By deleting the existing Bye-law 122 in its entirety and replacing therewith the following new Bye-law 122:

“122. A resolution in writing signed by all the Directors except such as are temporarily unable to act through ill-health or disability, and all the alternate Directors, if appropriate, whose appointors are temporarily unable to act as aforesaid shall be as valid and effectual as if a resolution had been passed at a meeting of the Board duly convened and held provided that such number is sufficient to constitute a quorum and that a copy of such resolution has been given or the contents thereof communicated to all the Directors for the time being entitled to receive notices of Board meetings in the same manner as notices of meetings are required to be given by these Bye-laws and further provided that no Director is aware of or has received any objection to the resolution from any Director. Such resolution may be contained in one document or in several documents in like form each signed by one or more of the Directors or alternate Directors and for this purpose a facsimile signature of a Director or an alternate Director shall be treated as valid.”

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(y) Bye-law 136

(i) By re-numbering existing Bye-law 136 as Bye-law 136(1).
(ii) By inserting the following as new Bye-law 136(2):
“(2) Notwithstanding any provision contained in these Bye-laws, the Directors may, if permitted by applicable law, authorise the destruction of documents set out in sub-paragraphs (a) to (f) of paragraph (1) of this Bye-law and any other documents in relation to share registration which have been microfilmed or electronically stored by the Company or by the share registrar on its behalf provided always that this Bye-law shall apply only to the destruction of a document in good faith and without express notice to the Company and its share registrar that the preservation of such document was relevant to a claim.”

(z) Bye-law 152

By inserting the words “or the Company in general meeting” after the words “by law or authorised by the Board” in existing Bye-law 152.

(aa) Bye-law 153

By inserting the words “and Bye-law 153A” after the words “Section 88 of the Act” in existing Bye-law 153.

(bb) Bye-laws 153A and 153B

By inserting the following paragraphs as new Bye-laws 153A and 153B:

“153A. To the extent permitted by and subject to due compliance with all applicable Statutes, rules and regulations, including, without limitation, the rules of the Designated Stock Exchange, and to obtaining all necessary consents, if any, required thereunder, the requirements of Bye-law 153 shall be deemed satisfied in relation to any person by sending to the person in any manner not prohibited by the Statutes, a summary financial statement derived from the Company’s annual accounts and the directors’ report which shall be in the form and containing the information required by applicable laws and regulations, provided that any person who is otherwise entitled to the annual financial statements of the Company and the directors’ report thereon may, if he so requires by notice in writing served on the Company, demand that the Company sends to him, in addition to a summary financial statement, a complete printed copy of the Company’s annual financial statement and the directors’ report thereon.

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153B. The requirement to send to a person referred to in Bye-law 153 the documents referred to in that provision or a summary financial report in accordance with Bye-law 153A shall be deemed satisfied where, in accordance with all applicable Statutes, rules and regulations, including, without limitation, the rules of the Designated Stock Exchange, the Company publishes copies of the documents referred to in Bye-law 153 and, if applicable, a summary financial report complying with Bye-law 153A, on the Company’s computer network or in any other permitted manner (including by sending any form of electronic communication), and that person has agreed or is deemed to have agreed to treat the publication or receipt of such documents in such manner as discharging the Company’s obligation to send to him a copy of such documents.”

(cc) Bye-law 154

By deleting the words “fourteen (14)” in existing Bye-law 154(2) and replacing therewith the words “twenty-one (21)”.

(dd) Bye-law 160

By deleting the existing Bye-law 160 in its entirety and replacing therewith the following new Bye-law 160:

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

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(ee) Bye-law 161

By deleting the existing Bye-law 161 in its entirety and replacing therewith the following new Bye-law 161:

“161. Any Notice or other document:

(a) if served or delivered by post, shall where appropriate be sent by airmail and shall be deemed to have been served or delivered on the day following that on which the envelope containing the same, properly prepaid and addressed, is put into the post; in proving such service or delivery it shall be sufficient to prove that the envelope or wrapper containing the notice or document was properly addressed and put into the post and a certificate in writing signed by the Secretary or other officer of the Company or other person appointed by the Board that the envelope or wrapper containing the notice or other document was so addressed and put into the post shall be conclusive evidence thereof;
(b) if sent by electronic communication, shall be deemed to be given on the day on which it is transmitted from the server of the Company or its agent. A notice placed on the Company’s website is deemed given by the Company to a Member on the day following that on which a notice of availability is deemed served on the Member;
(c) if served or delivered in any other manner contemplated by these Bye-laws, shall be deemed to have been served or delivered at the time of personal service or delivery or, as the case may be, at the time of the relevant despatch, transmission or publication; and in proving such service or delivery a certificate in writing signed by the Secretary or other officer of the Company or other person appointed by the Board as to the fact and time of such service, delivery, despatch, transmission or publication shall be conclusive evidence thereof; and
(d) may be given to a Member either in the English language or the Chinese language, subject to due compliance with all applicable Statutes, rules and regulations.”

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(ff) Bye-law 163

By inserting the words “or electronic” after the words “a cable or telex or facsimile” in existing Bye-law 163.

By Order of the Board Man Yue International Holdings Limited Leung Ho Yin Company Secretary

Hong Kong, 27th April 2004

Principal Office:

16th Floor

Yiko Industrial Building 10 Ka Yip Street Chai Wan Hong Kong

Notes:

Every member entitled to attend and vote at the above meeting is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a member of the Company.
In order to be valid, a form of proxy, together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power or authority must be deposited at the Company’s branch share registrar in Hong Kong, Tengis Limited at G/F, BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the meeting (or any adjournment thereof).
The Register of Members of the Company will be closed from Wednesday, 19th May 2004 to Monday, 24th May 2004, both days inclusive, during which period no transfer of shares will be effected. In order to ascertain the right to attend the meeting, all transfers accompanied by the relevant share certificates must be lodged for registration with the Company’s branch share registrar in Hong Kong, Tengis Limited at the above address not later than 4:00 p.m. on Tuesday, 18th May 2004.

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