Guoco Group Limited — AGM Information 2011

Jul 11, 2011

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular, you should consult a stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your securities in Far East Hotels and Entertainment Limited, you should at once hand this circular to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

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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FAR EAST HOTELS AND ENTERTAINMENT LIMITED 遠東酒店實業有限公司

(Incorporated in Hong Kong under the Companies Ordinance)

(Stock Code: 0037)

GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE SHARES RE-ELECTION OF RETIRING DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening an annual general meeting of the Shareholders of Far East Hotels And Entertainment Limited to be held at The Penthouse, Far East Consortium Building, 121 Des Voeux Road Central, Hong Kong on Friday, 12 August 2011 at 3:00 p.m. is set out on pages 13 to 16 of this circular. Whether or not you are able to attend the meeting in person, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon and return it to the Company’s registered office at Suite 2308, 23rd Floor, Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong, as soon as possible and in any event not later than 48 hours before the time appointed for holding the meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting should you wish.

Hong Kong, 12 July 2011

CONTENTS

		Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1-2
**LETTER **	FROM THE MANAGING DIRECTOR AND CHIEF EXECUTIVE
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
2.	General Mandate to Repurchase Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
3.	General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
4.	Re-election of Retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
5.	Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
6.	Voting by Poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
7.	Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
8.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
APPENDIX I – EXPLANATORY STATEMENT ON REPURCHASE
	OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7-9
APPENDIX II – INFORMATION ON RETIRING DIRECTORS
	PROPOSED FOR RE-ELECTION . . . . . . . . . . . . . . . . . . . . . .	10-12
**NOTICE **	OF ANNUAL GENERAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13-16

– i –

DEFINITIONS

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

• “AGM” the annual general meeting of the Company to be held at the Penthouse, Far East Consortium Building, 121 Des Voeux Road Central, Hong Kong on Friday, 12 August 2011 at 3:00 p.m., notice of which is set out in Notice of Annual General Meeting of this circular

• “Articles of Association” Articles of Association of the Company

• “Board” the board of Directors

• “Companies Ordinance” the Companies Ordinance (Chapter 32) of the Laws of Hong Kong

• “Company” Far East Hotels And Entertainment Limited, a company incorporated in Hong Kong with limited liability under the Companies Ordinance

• “Directors” directors of the Company

• “Group” the Company and its subsidiaries from time to time

• “Issue Mandate” the general mandate to be unconditionally given to the Board to issue and deal with additional Shares not exceeding 20% of the issued share capital of the Company, the particulars of which are set out in resolution 5 of the notice convening the AGM

• “Latest Practicable Date” 7 July 2011, being the latest practicable date prior to the printing of this circular for ascertaining certain information referred to in this circular

• “Listing Rules”

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

• “Repurchase Mandate”

• the general mandate to be unconditionally given to the Board to repurchase Shares up to 10% of the issued share capital of the Company, the particulars of which are set out in resolution 6 of the notice convening the AGM

– 1 –

DEFINITIONS

“Repurchase Proposal”	the proposal as described in the Repurchase Resolution
	whereby a general mandate is to be given to the
	Directors to exercise the powers of the Company to
	repurchase Shares up to 10% of the issued share capital
	of the Company as at the date of the Repurchase
	Resolution
“Repurchase Resolution”	the proposed ordinary resolution as set out in resolution
	6 of the notice of the Annual General Meeting
“Share(s)”	share(s) of $0.10 each in the share capital of the
	Company
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Takeovers Code”	the Code on Takeovers and Mergers
“$” and “cents”	Hong Kong dollars and cents respectively

– 2 –

LETTER FROM THE MANAGING DIRECTOR AND CHIEF EXECUTIVE

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FAR EAST HOTELS AND ENTERTAINMENT LIMITED 遠東酒店實業有限公司

(Incorporated in Hong Kong under the Companies Ordinance) (Stock Code: 0037)

Executive Directors: Deacon Te Ken Chiu, J.P. (Chairman) Derek Chiu, B.A. (Managing Director and Chief Executive) Desmond Chiu, B.A. (Deputy Managing Director) Margaret Chiu, LL B.

Registered & Principal Office: Suite 2308, 23rd Floor Office Tower, Convention Plaza 1 Harbour Road Wanchai, Hong Kong

Non-executive Directors: Chiu Ju Ching Lan, J.P. Dick Tat Sang Chiu, M.A. Tan Sri Dato’ David Chiu, B.Sc. Dennis Chiu, B.A. Duncan Chiu, B.Sc.

Independent Non-executive Directors: Ip Shing Hing, J.P. Ng Wing Hang Patrick Choy Wai Shek Raymond, MH, J.P.

12 July 2011

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATES TO REPURCHASE SHARES AND TO ISSUE SHARES RE-ELECTION OF RETIRING DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information regarding the resolutions to be proposed at the forthcoming AGM. These include (i) the ordinary resolutions granting the Directors general mandates to issue Shares and repurchase Shares and to extend the Repurchase Mandate, and (ii) the ordinary resolutions relating to the re-election of Directors.

– 3 –

LETTER FROM THE MANAGING DIRECTOR AND CHIEF EXECUTIVE

GENERAL MANDATE TO REPURCHASE SHARES

At the last annual general meeting of the Company held on 3 September 2010, a general mandate was given to the Board to exercise the power of the Company to repurchase the Shares. Such mandate will lapse at the conclusion of the AGM. Therefore, at the AGM, an ordinary resolution will be proposed that the Directors be granted a new general and unconditional mandate to exercise all powers of the Company to repurchase the Share(s) on the Stock Exchange, or on any other stock exchange on which the Shares may be listed, up to 10% of the issued share capital of the Company as at the date of the resolution approving the Repurchase Mandate.

As at the Latest Practicable Date, there was a total of 488,842,675 Shares in issue. Subject to the passing of the resolution granting the Repurchase Mandate and on the basis that no further Shares are issued or repurchased before the AGM, the Company will be allowed to repurchase a maximum of 48,884,267 Shares. An explanatory statement, as required by the relevant provisions set out in the Listing Rules, to provide requisite information to you for consideration of the Repurchase Proposal is set out in Appendix I of this circular. The explanatory statement contains all information reasonably necessary to enable the Shareholders to make an informed decision on whether to vote for or against the relevant resolutions at the AGM. The Directors propose to seek your approval of the Repurchase Resolution to be proposed at the AGM.

GENERAL MANDATE TO ISSUE SHARES

An ordinary resolution will be proposed that the Directors be granted a new general and unconditional mandate to allot, issue, and deal with Shares not exceeding 20% of the issued share capital of the Company as at the date of the resolution.

As at the Latest Practicable Date, there was a total of 488,842,675 Shares in issue. Subject to the passing of the resolution granting the Issue Mandate and on the basis that no further Shares are issued or repurchased before the AGM, the Company will be allowed to issue a maximum of 97,768,535 Shares under the Issue Mandate.

In addition, an ordinary resolution will be proposed at the AGM adding any Shares repurchased under the Repurchase Mandate to the Issue Mandate. The Repurchase Mandate and the Issue Mandate will continue in force until the conclusion of the next annual general meeting of the Company unless it is renewed at such meeting or until revoked or varied by ordinary resolution of the Shareholders in a general meeting held prior to the next annual general meeting of the Company.

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LETTER FROM THE MANAGING DIRECTOR AND CHIEF EXECUTIVE

RE-ELECTION OF RETIRING DIRECTORS

The Board comprises twelve directors of which four are executive directors namely Mr. Deacon Te Ken Chiu, Mr. Derek Chiu, Mr. Desmond Chiu, Ms. Margaret Chiu; five are non-executive directors namely Mrs. Chiu Ju Ching Lan, Mr. Dick Tat Sang Chiu, Mr. David Chiu, Mr. Dennis Chiu, Mr. Duncan Chiu; three are independent non-executive directors namely Mr. Ip Shing Hing, Mr. Ng Wing Hang Patrick and Mr. Choy Wai Shek Raymond.

In accordance with Articles 78 and 79 of the Articles of Association, Mr. David Chiu, Ms. Margaret Chiu, Mr. Ip Shing Hing and Mr. Ng Wing Hang Patrick will retire by rotation at the forthcoming AGM of the Company. Mr. David Chiu will not offer himself for re-election as Director whereas the other three persons, being eligible, have offered themselves for re-election. Mr. David Chiu has confirmed that he has no claims whatsoever against the Company for fees, compensation for loss of office, remuneration, severance payments, pension, expenses or otherwise and there is no disagreement with the Board and there are no matters relating to his retirement that need to be brought to the attention of the Shareholders or the Stock Exchange. The Company has determined not to fill up the place of the retiring director in order to reduce the number of Directors in the Board. Details of the above Directors that are required to be disclosed under the Listing Rules are set out in Appendix II of this circular.

NOTICE OF ANNUAL GENERAL MEETING

A notice convening the AGM is set out in this circular. A proxy form for use at the AGM appointing proxy is despatched with this circular and published on the website of the Stock Exchange (www.hkex.com.hk). Whether or not you intend to attend the AGM, you are requested to complete the proxy form and return it to the Company’s registered office at Suite 2308, 23rd Floor, Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong not less than 48 hours before the time appointed for the holding of the AGM or the adjourned meeting. Completion and return of a proxy form will not preclude you from attending and voting at the meeting and at any adjournment thereof if you so wish.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, any votes of the Shareholders at a general meeting must be taken by poll. Therefore, the chairman of the AGM will demand a poll for each and every resolution put forward at the AGM pursuant to Article 57 of the Articles of Association. The Company will appoint scrutineers to handle vote-taking procedures at the AGM. The results of the poll will be published on the websites of the Stock Exchange and the Company as soon as possible in accordance with Rule 13.39(5) of the Listing Rules.

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accepts full responsibility, includes particulars given in compliance with the Listing Rules 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

– 5 –

LETTER FROM THE MANAGING DIRECTOR AND CHIEF EXECUTIVE

contained in this circular is accurate and complete in all material aspects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein in this circular misleading.

RECOMMENDATION

The Directors consider that the ordinary resolutions in relation to the general mandates to be granted to the Directors to issue Shares, the Repurchase Mandates and the extension thereof and the re-election of Directors as set out in the notice of AGM are in the best interests of the Company and the Shareholders as a whole. The Directors therefore recommend the Shareholders to vote in favour of each of the ordinary resolutions as set out in the notice of the AGM.

Yours faithfully,

DEREK CHIU

Managing Director and Chief Executive

– 6 –

APPENDIX I EXPLANATORY STATEMENT ON REPURCHASE OF SHARES

This Appendix serves as an explanatory statement, as required pursuant to Rule 10.06(1)(b) of the Listing Rules, to provide certain information to you for your consideration of the Repurchase Mandate, and also constitutes the memorandum as required under Section 49BA of the Companies Ordinance.

1. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 488,842,675 Shares of HK$0.10 each.

Subject to the passing of the resolutions granting the Issue Mandate and the Repurchase Mandate and on the basis that no further Shares are issued or repurchased before the AGM, the Company will be allowed to repurchase up to 48,884,267 Shares, representing approximately 10% of the issued share capital of the Company as at the date of passing of the relevant resolution.

2. REASONS FOR REPURCHASE

The Directors believe that the Repurchase Proposal is in the best interests of the Company and the Shareholders. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value and/or earnings per Share of the Company and will only be made when the Directors believe that such a repurchase will benefit the Company and the Shareholders.

3. FUNDING OF REPURCHASE

Any repurchases made pursuant to the Repurchase Mandate will be funded out of funds legally available for such purpose in accordance with the Company’s Memorandum and Articles of Association and the Companies Ordinance. Such funds include distributable profits of the Company and/or the proceeds of a new issue of Shares made for the purposes of the repurchase.

There might be a material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited consolidated accounts contained in the annual report for the year ended 31 March 2011) in the event that the Repurchase Mandate was to be carried out in full at any time during the proposed repurchase period. However, the Directors will not propose to exercise the Repurchase Mandate to such extent as would, in the circumstances, have a material adverse impact on the working capital requirements of the Company or the gearing levels of the Company.

– 7 –

APPENDIX I EXPLANATORY STATEMENT ON REPURCHASE OF SHARES

4. SHARE PRICES

The highest and lowest prices at which the Shares had been traded on the Stock Exchange during each of the twelve months preceding the Latest Practicable Date were as follows:

	**Share **	Prices
	Per Share
	Highest	Lowest
	HK$	HK$
2010
July	0.285	0.260
August	0.280	0.250
September	0.300	0.255
October	0.285	0.260
November	0.280	0.255
December	0.305	0.240
2011
January	0.300	0.242
February	0.290	0.250
March	0.285	0.240
April	0.280	0.240
May	0.275	0.236
June	0.260	0.211
July (up to and including the Latest Practicable Date)	0.238	0.231

5. UNDERTAKING AND DISCLOSURE OF INTERESTS

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates, has any present intention to sell any Shares to the Company, if the Repurchase Mandate is approved by the Shareholders.

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will only exercise the Repurchase Mandate in accordance with the Listing Rules and the Companies Ordinance, and in accordance with the regulations set out in the Memorandum and Articles of Association of the Company.

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

– 8 –

APPENDIX I EXPLANATORY STATEMENT ON REPURCHASE OF SHARES

6. HONG KONG CODE ON TAKEOVERS AND MERGERS

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 purposes of Rule 32 of the Takeovers Code. Accordingly, a Shareholder, or a group of Shareholders acting in concert, depending on the level of increase of the Shareholders’ interest, could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, Messrs. Deacon Te Ken Chiu, Derek Chiu, Dick Tat Sang Chiu, Chiu Ju Ching Lan, David Chiu and Margaret Chiu, being directors of the Company together with their respective associates were beneficially interested in an aggregate of 255,675,475 Shares representing 52.30% of the issued share capital of the Company. Based on such shareholdings and in the event that the Directors exercised in full the power to repurchase Shares under the Repurchase Proposal, if so approved, and assuming no Shares are issued or repurchased prior to the date of the Annual General Meeting, the shareholdings of Messrs. Deacon Te Ken Chiu, Derek Chiu, Dick Tat Sang Chiu, Chiu Ju Ching Lan, David Chiu and Margaret Chiu together with their respective associates would be increased to 58.11 % of the issued share capital of the Company.

The Directors are not aware of any consequences which may arise under the Takeovers Code as a result of any repurchases made under the Repurchase Proposal. In the event that the Repurchase Proposal is exercised in full, the number of Shares held by the public would not fall below 25%.

7. SHARE REPURCHASE MADE BY THE COMPANY

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

– 9 –

INFORMATION ON RETIRING DIRECTORS PROPOSED FOR RE-ELECTION

APPENDIX II

The following are the particulars of the Directors proposed to be re-elected at the AGM.

Ms. Margaret Chiu , LL.B. (Executive Director)

Aged 54. She joined and was appointed as Director of the Company in 1989. She graduated with law degree from the University of Buckingham, the United Kingdom. She has extensive experience in entertainment, television and motion picture business in Hong Kong, the People’s Republic of China and overseas. She was a Non-executive Director of Far East Holdings International Limited (stock code: 36) and had retired on 7 June 2010. She is the daughter of Mr. Deacon Te Ken Chiu and Madam Chiu Ju Ching Lan and the sister of Messrs. Dick Tat Sang Chiu, David Chiu, Dennis Chiu, Derek Chiu, Desmond Chiu and Duncan Chiu.

Save as disclosed above, she has not held in the last three years other directorships in public companies the securities of which are listed on any securities market in Hong Kong or overseas.

She beneficially owns 5,676,240 Shares, representing approximately 1.16% of the entire issued share capital of the Company as at the Latest Practicable Date. Save as disclosed above, she does not have any interests in the Shares within the meaning of Part XV of the Securities and Futures Ordinance.

There is no service contract entered into between Ms. Chiu and the Company or any of its subsidiaries. She receives emolument from the Company that is determined by the Board from time to time with reference to prevailing market conditions and director’s fee of HK$10,000 per annum (with reference to market conditions and as approved by the Shareholders on the latest annual general meeting). The term of office of Ms Chiu is subject to retirement by rotation and re-election at the AGM in accordance with the Articles of Association.

Save as disclosed above, there are no other matters concerning Ms. Chiu that need to be brought to the attention of the Shareholders nor any information to be disclosed pursuant to the requirements of Rule 13.51(2) of the Listing Rules.

Mr. Ip Shing Hing , J.P. (Independent Non-executive Director)

Aged 56. Mr. lp was appointed as an Independent Non-executive Director of the Company on 31 March 1997. He holds a Bachelor of Laws Degree from the University of Hong Kong and a Master of Arts in Arbitration and Alternative Dispute Resolution from the City University of Hong Kong. He has been a practising solicitor in Hong Kong for more than 20 years. Mr. Ip is an independent non-executive director of Binhai Investment Company Limited (stock code: 8035). He was an independent non-executive director of Quam Limited (stock code: 952) and had retired on 11 September 2008.

He is also a member of the Audit Committee of the Company.

– 10 –

INFORMATION ON RETIRING DIRECTORS PROPOSED FOR RE-ELECTION

APPENDIX II

Save as disclosed above, he has not held in the last three years other directorships in public companies the securities of which are listed on any securities market in Hong Kong or overseas.

He does not have any relationship with any Directors, senior management or substantial or controlling shareholders of the Company.

Mr. Ip has been granted share options to subscribe for an aggregate of 1,000,000 Shares of the Company at an exercise price of HK$0.282 per share which are exercisable from 30 December 2009 up to 29 December 2019. Save as disclosed above, he does not have any interests in the Shares within the meaning of Part XV of the Securities and Futures Ordinance.

There is no service contract entered into between Mr. Ip and the Company or any of its subsidiaries. He receives no emolument from the Company except director’s fee of HK$120,000 per annum (with reference to market conditions and as approved by the Shareholders on the latest annual general meeting). The term of office of Mr. Ip is subject to retirement by rotation and re-election at the AGM in accordance with the Articles of Association.

Save as disclosed above, there are no other matters concerning Mr. Ip that need to be brought to the attention of the Shareholders nor any information to be disclosed pursuant to the requirements of Rule 13.51(2) of the Listing Rules.

Mr. Ng Wing Hang Patrick (Independent Non-executive Director)

Aged 58. Mr. Ng was appointed as an Independent Non-executive Director of the Company on 28 September 2004. He is a practising Certified Public Accountant in Hong Kong and is the Managing Director of Messrs. Pan-China (H.K.) CPA Limited, Certified Public Accountants. Mr. Ng also serves as independent non-executive director on the board of another listed company in Hong Kong, namely, Shenyin Wanguo (H.K.) Limited (stock code: 218). He was an independent non-executive director Dynamic Energy Holdings Limited (stock code: 578) and had resigned on 28 April 2010.

He is also a member of the Audit Committee and Remuneration Committee of the Company.

Save as disclosed above, he has not held in the last three years other directorships in public companies the securities of which are listed on any securities market in Hong Kong or overseas.

He does not have any relationship with any Directors, senior management or substantial or controlling shareholders of the Company.

– 11 –

INFORMATION ON RETIRING DIRECTORS PROPOSED FOR RE-ELECTION

APPENDIX II

Mr. Ng has been granted share options to subscribe for an aggregate of 1,000,000 Shares of the Company at an exercise price of HK$0.282 per share which are exercisable from 30 December 2009 up to 29 December 2019. Save as disclosed above, he does not have any interests in the Shares within the meaning of Part XV of the Securities and Futures Ordinance.

There is no service contract entered into between Mr. Ng and the Company or any of its subsidiaries. He receives no emolument from the Company except director’s fee of HK$120,000 per annum (with reference to market conditions and as approved by the Shareholders on the latest annual general meeting). The term of office of Mr. Ng is subject to retirement by rotation and re-election at the AGM in accordance with the Articles of Association.

Save as disclosed above, there are no other matters concerning Mr. Ng that need to be brought to the attention of the Shareholders nor any information to be disclosed pursuant to the requirements of Rule 13.51(2) of the Listing Rules.

– 12 –

NOTICE OF ANNUAL GENERAL MEETING

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FAR EAST HOTELS AND ENTERTAINMENT LIMITED 遠東酒店實業有限公司

(Incorporated in Hong Kong under the Companies Ordinance) (Stock Code: 0037)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that an Annual General Meeting of Far East Hotels And Entertainment Limited (the “Company”) will be held at the Penthouse, Far East Consortium Building, 121 Des Voeux Road Central, Hong Kong on Friday, 12 August 2011 at 3:00 p.m. for the following purposes:

As ordinary business:

1. To adopt the audited consolidated financial statements and the reports of the directors and of the auditor for the year ended 31 March 2011;

2. To re-elect retiring directors of the Company;

3. To authorize the board of directors to fix the remuneration of the directors;

4. To re-appoint the auditor of the Company and to authorize the board of directors to fix the remuneration of the auditor;

As special business:

To consider and, if thought fit, pass the following resolutions, with or without amendments, as Ordinary Resolutions:

1. “ THAT

2. (a) subject to paragraph (c) below, the exercise by the directors of the Company (the “Directors”) during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional shares of the Company and to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which might require the exercise of such powers be and is hereby generally and unconditionally approved;

– 13 –

NOTICE OF ANNUAL GENERAL MEETING

• (b) the approval in paragraph (a) of this resolution shall authorise the Directors during the Relevant Period to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which might require the exercise of such powers after the end of the Relevant Period;

• (c) the aggregate nominal amount of the share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (a) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); (ii) any Share Option Scheme (as hereinafter defined) of the Company; (iii) the exercise of rights of conversion under the terms of any securities which are convertible into shares of the Company or warrants to subscribe for shares of the Company; or (iv) any scrip dividend or other similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares of the Company pursuant to the Articles of Association of the Company, shall not exceed 20% of the existing issued share capital of the Company as at the date of passing of this resolution and the approval in paragraph (a) of this resolution shall be limited accordingly; and

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

• i. the conclusion of the next annual general meeting of the Company;

• ii. the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association of the Company or any applicable laws to be held;

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

“Rights Issue” means an offer of shares open for a period fixed by the Directors to holders of shares of the Company on the register of members on a fixed record date in proportion to their then holdings of such shares (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of any relevant jurisdiction, or the requirements of any recognised regulatory body or any stock exchange applicable to the Company); and

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

– 14 –

NOTICE OF ANNUAL GENERAL MEETING

1. “ THAT

2. (a) subject to paragraph (b) of this resolution, the exercise by the directors of the Company (the “Directors”) during the Relevant Period (as hereinafter defined) of all the powers of the Company to purchase its own shares on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the securities of the Company may be listed and recognised by The Securities and Futures Commission of Hong Kong (the “Securities and Futures Commission”) and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws and the rules and regulations of the Securities and Futures Commission, the Stock Exchange or of other stock exchange as amended from time to time, be and is hereby generally and unconditionally approved;

3. (b) the aggregate nominal amount of shares of the Company to be repurchased by the Company pursuant to the approval in paragraph (a) above shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of this resolution, and the said approval shall be limited accordingly; and

4. (c) for the purpose of this resolution, “Relevant Period” means the period from the passing of this resolution until whichever is the earliest of:

   • i. the conclusion of the next annual general meeting of the Company;

   • ii. the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association of the Company or any applicable laws to be held;

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

5. “ THAT conditional upon the passing of Ordinary Resolutions 5 and 6 as set out in the notice convening this Annual General Meeting, the general mandate granted to the Directors to allot, issue and deal with additional shares in the capital of the Company pursuant to the said Ordinary Resolution 5 be and is hereby extended by the addition thereto the aggregate nominal amount of share capital of the Company repurchased by the Company under the authority granted pursuant to the said Ordinary Resolution 6 provided that such amount shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of this resolution.”

By order of the Board FAR EAST HOTELS AND ENTERTAINMENT LIMITED TANG SUNG KI Secretary

Hong Kong, 12 July 2011

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NOTICE OF ANNUAL GENERAL MEETING

Notes:

• (a) The register of members of the Company will be closed from 10 August 2011 to 12 August 2011 (both days inclusive), during which period no transfer of shares will be effected. In order to qualify for attending the Annual General Meeting (“AGM”), all transfers accompanied by the relevant share certificates must be lodged with Tricor Standard Limited, the Registrars of the Company, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong not later than 4:00 p.m. on 9 August 2011.

• (b) A member entitled to attend and vote at the AGM is entitled to appoint one or, under particular case, more proxies to attend and vote on his behalf. A proxy need not be a member of the Company.

• (c) Where there are joint registered holders of any share, any one of such persons may vote at the AGM, either personally or by proxy, in respect of such share as if he was solely entitled thereto, but if more than one of such joint holders is present at the AGM personally or by proxy, that one of the said persons so present whose name stands first on the register of members of the Company shall, in respect of such share, be entitled alone to vote in respect thereof.

• (d) In order to be valid, the instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed must be lodged at the Company’s registered office at Suite 2308, 23rd Floor, Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong not less than 48 hours before the time appointed for the holding of the AGM (or the adjourned meeting as the case may be).

• (e) Completion and return of the form of proxy will not preclude a member from attending and voting in person at the AGM, if he so wishes. If such member attends the AGM, his form of proxy will be deemed to have been revoked.

• (f) Concerning Ordinary Resolution No. 2 above, Ms. Margaret Chiu, Mr. Ip Shing Hing and Mr. Ng Wing Hang shall retire by rotation and, being eligible, have offered themselves for re-election at the AGM. Details of the above Directors are set out in Appendix II to the circular dated 12 July 2011.

As at the date of this notice, the executive Directors are Mr. Deacon Te Ken Chiu, Mr. Derek Chiu, Mr. Desmond Chiu, Ms. Margaret Chiu; the non-executive Directors are Mrs. Chiu Ju Ching Lan, Mr. Dick Tat Sang Chiu, Mr. David Chiu, Mr. Dennis Chiu, Mr. Duncan Chiu; the independent non-executive Directors are Mr. Ip Shing Hing, Mr. Ng Wing Hang Patrick, Mr. Choy Wai Shek Raymond.

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