Hephaestus Holdings Limited — Proxy Solicitation & Information Statement 2006

Jul 4, 2006

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Panorama International Holdings Limited, you should at once hand this circular, together with the form of proxy, to the purchaser or the 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.

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

PANORAMA INTERNATIONAL HOLDINGS LIMITED
鉛射國際控股有限公司*
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 8173)

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

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market 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: (i) the information contained in this circular is accurate and complete in all material respects and not misleading; (ii) there are no other matters the omission of which would make any statement in this circular misleading; and (iii) all opinions expressed in this circular have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable.

This circular will remain on the GEM website with the domain name of www.hkgem.com on the "Latest Company Announcements" page for at least 7 days from the date of its posting.

30 June, 2006

• For identification purpose only

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CHARACTERISTICS OF GEM

GEM has been established as a market designed to accommodate companies to which a high investment risk may be attached. In particular, companies may list on GEM with neither a track record of profitability nor any obligation to forecast future profitability. Furthermore, there may be risks arising out of the emerging nature of companies listed on GEM and the business sectors or countries in which the companies operate. 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. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the main board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM.

The principal means of information dissemination on GEM is publication on the Internet website operated by the Stock Exchange. Listed companies are not generally required to issue paid announcements in gazetted in newspapers. Accordingly, prospective investors should note that they need to have access to the GEM website in order to obtain up-to-date information on GEM-listed issues.

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TABLE OF CONTENTS

Page

Definitions 1-2

Letter from the board of Directors

Introduction 3

General Mandates to Issue and Repurchase Shares 3-4

Explanatory Statement 4

Re-election of Retiring Directors 4-6

Procedure by which a Poll may be Demanded 6-7

General Information 7

Recommendation 7

Appendix — Explanatory Statement 8-10

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DEFINITIONS

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

"Annual General Meeting"
the annual general meeting of the Company to be held at 8th Floor, Mita Centre, 552-566 Castle Peak Road, Kwai Chung, N.T., Hong Kong on Friday, 28 July, 2006 at 4:00 p.m. or any adjournment thereof;

"Annual Report"
the annual report of the Company for the financial year ended 31 March, 2006;

"Articles of Association"
the articles of association of the Company;

"Code"
The Hong Kong Codes on Takeovers and Mergers;

"Company"
Panorama International Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on GEM;

"Directors"
the directors of the Company;

"GEM"
the Growth Enterprise Market of the Stock Exchange;

"HK$"
Hong Kong dollars, the lawful currency of Hong Kong;

"Hong Kong"
the Hong Kong Special Administrative Region of the People's Republic of China;

"Latest Practicable Date"
30 June, 2006 being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular;

"Listing Rules"
The Rules Governing the Listing of Securities on the Stock Exchange on GEM;

"Notice"
the notice of the Annual General Meeting as set out on pages 96 to 100 of the Annual Report;

"Repurchase Mandate"
a general mandate proposed to be granted to the Directors at the Annual General Meeting to repurchase Shares not exceeding 10 per cent of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the relevant resolution granting such mandate;

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DEFINITIONS

"SFO"
the Securities and Futures Ordinance chapter 571 of the Laws of Hong Kong;

"Share(s)"
ordinary share(s) of HK$0.01 each in the share capital of the Company;

"Shareholder(s)"
holder(s) of Share(s); and

"Stock Exchange"
The Stock Exchange of Hong Kong Limited.

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LETTER FROM THE BOARD OF DIRECTORS

PAH

PANORAMA INTERNATIONAL HOLDINGS LIMITED

諾射國際控股有限公司*

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8173)

Executive Directors:

Mr. Fung Yu Hing, Allan

(Chairman and chief executive officer)

Ms. Leung Siu Kuen, Janet

Mr. Fung Yee Sang

Mr. Au Lik Man, Simon

Non-executive Directors:

Dr. Lo Wing Yan, William, JP

Ms. Fung Suen Lai, Jacqueline

Independent non-executive Directors:

Mr. Chan Koon Chung, Johnny

Mr. Chau, Stephen

Mr. Hui Kwok Wah

Registered office:

P.O. Box 309

Ugland House

South Church Street

George Town

Grand Cayman

Cayman Islands

British West Indies

Head office and principal

place of business in Hong Kong:

8th Floor, Mita Centre

552-566 Castle Peak Road

Kwai Chung, N.T.

Hong Kong

30 June, 2006

To the Shareholders

Dear Sir or Madam,

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

INTRODUCTION

The purpose of this circular is to provide Shareholders with details regarding the proposed grant of the general mandates to allot, issue and deal with Shares and to repurchase Shares and the proposed re-election of retiring Directors to be dealt with at the forthcoming Annual General Meeting to be held at 8th Floor, Mita Centre, 552-566 Castle Peak Road, Kwai Chung, N.T., Hong Kong on Friday, 28 July, 2006 at 4:00 p.m.

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES

At the Annual General Meeting, separate ordinary resolutions will be proposed to grant to the Directors fresh general mandates (i) to allot, issue and otherwise deal with Shares not exceeding 20 per cent of the aggregate nominal amount of the share capital of the Company in issue at the date of passing the ordinary resolution no. 4A (the "Resolution No. 4A") in the Notice; (ii) to repurchase Shares up to a

• For identification purpose only

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LETTER FROM THE BOARD OF DIRECTORS

maximum of 10 per cent of the aggregate nominal amount of the share capital of the Company in issue at the date of passing the ordinary resolution no. 4B (the "Resolution No. 4B") in the Notice; and (iii) by extending the general mandate granted pursuant to the Resolution No. 4A, to allot, issue and otherwise deal with the Shares with an aggregate nominal amount not exceeding the aggregate nominal amount of the share capital of the Company purchased pursuant to the Repurchase Mandate (as more particularly described in ordinary resolution no. 4C (the "Resolution No. 4C") in the Notice) ((i), (ii) and (iii) are collectively described as the "Mandates") during the period from the date of passing of Resolutions Nos. 4A to 4C up to: (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 any applicable laws or the Articles of Association to be held; or (c) the revocation, variation or renewal of the Mandates by ordinary resolution of the Shareholders in a general meeting, whichever occurs first.

EXPLANATORY STATEMENT

An explanatory statement containing all relevant information relating to the Repurchase Mandate is set out in the appendix to this circular. The information in the explanatory statement is to provide you with the 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 at the Annual General Meeting.

RE-ELECTION OF RETIRING DIRECTORS

Pursuant to Article 116 of the Articles of Association, Dr. Lo Wing Yan, William, JP, Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny shall retire at the Annual General Meeting (being Directors retiring by rotation) and, being eligible, offer themselves for re-election at the Annual General Meeting. Their details are as follows:

Dr. Lo Wing Yan, William, JP, aged 45, is currently the Vice Chairman, Managing Director and Chief Financial Officer of I.T Limited, which is listed on the Hong Kong Stock Exchange. Prior to I.T Limited, Dr. Lo was the Executive Director and vice-president of China Unicom Ltd., an integrated telecommunications operator in China, which is listed on both the Hong Kong and the New York Stock Exchange. Also, Dr. Lo held various senior positions with Citibank, N.A., Hongkong Telecom Group, Cable & Wireless Plc, and McKinsey & Company, Inc. Dr. Lo held various government appointments over the year including the Directorship of the Hong Kong Applied Science and Technology Research Institute as well as the Hong Kong Jockey Club Institute of Chinese Medicine Ltd. He is a non-executive Director of a number of publicly listed companies including Nam Tai Electronics, Inc., Softbank Investment International (Strategic) Ltd., Ocean Grand Chemicals Holdings Ltd. and Superdata Software Holdings Ltd. Dr. Lo holds an M.Phil. degree in Molecular Pharmacology and a Ph.D. degree in Genetic Engineering, both from Cambridge University, England. He was a Commonwealth Scholar, a Croucher Foundation Fellow and a Bye-Fellow of Downing College, Cambridge. In 1996, the Davos-based World Economic Forum selected Dr. Lo as a "Global Leader for Tomorrow". In 1999, he was appointed as a Justice of the Peace (JP) by the Hong Kong SAR Government. In 2003, Dr. Lo was appointed as Committee Member of Shantou People's Political Consultative Conference.

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LETTER FROM THE BOARD OF DIRECTORS

Ms. Fung Suen Lai, Jacqueline, aged 34, was appointed as a non-executive Director in April 2002. Ms. Fung has almost seven years of experience in the architectural industry, and had participated in design and construction work for Kowloon station of Kowloon Canton Railway. She was educated at Cornell University in the United States. Ms. Fung had been a founder and director of architectural design practice, 2 DN, for the period from January 1998 to April 2001 covering full range of design projects in Hong Kong, Taiwan and the PRC. Ms. Fung worked for Integrated Design Associates as architectural designer on several airports in the years 2001 and 2002. Ms. Fung is the daughter of Mr. Fung Yu Hing, Allan and Ms. Leung Siu Kuen, Janet.

Mr. Chau, Stephen, aged 43, was appointed as an independent non-executive Director in April 2002. Mr. Chau graduated from the University of Southern California with a bachelor degree in business administration. He worked in the advertising, public relation and banking industries. He worked for an advertising agency and then changed his career to private banking business in Republic Bank of New York and Standard Chartered Bank. Mr. Chau had also worked in a major paging company and was in charge of customer service. In 1997, Mr. Chau founded Starz People (HK) Limited, a well-known talent and modeling agency in Hong Kong

Mr. Chan Koon Chung, Johnny, aged 53, was appointed as an independent non-executive Director in April 2002. Mr. Chan graduated with a bachelor degree in social science from the University of Hong Kong, and then further studied at Boston University in the U.S. majoring in journalism. He founded the trend-setting lifestyle "City Magazine" (formerly known as "Tabloid") in 1970's.

Save as disclosed above. Dr. Lo Wing Yan, William, JP, Ms. Fung Suen Lai, Jacqueline, Mr. Chau Stephen and Mr. Chan Koon Chung, Johnny do not have any other relationship with any Directors, senior management, management Shareholders, substantial Shareholders, or controlling Shareholders of the Company.

Each of Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny entered into a letter of appointment with the Company on 25 April, 2002. There is no fixed term of office for the appointment of Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny, and their appointments will be continuous unless and until terminated by not less than three months' notice in writing given by any of them or the Company (as the case may be) subject to the vacation of office as required under the Articles of Association of the Company and/or the termination provisions under his letter of appointment. In relation to Dr. Lo Wing Yan, William, JP, his appointment as a non-executive Director was for an initial term of 24 months commending from 25 April, 2002 and continues thereafter unless and until terminated by either party by giving to other party not less than three months' prior written notice.

Pursuant to the letter of appointments, Dr. Lo Wing Yan, William, JP, Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny received emoluments to a total value of HK$170,000, HK$60,000, HK$60,000 and HK$60,000 respectively in 2005/06, which is determined by reference to the Company's performance and profitability as well as the prevailing market condition. If Dr. Lo Wing Yan, William, JP, Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny are re-elected as Directors, each of their letter of appointments with the Company will remain effective after their re-election. The terms of their letter of appointments will remain the same and their appointment will be continuous unless and until terminated by either party giving to the other party not less than three months' prior written notice.

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LETTER FROM THE BOARD OF DIRECTORS

As at the Latest Practicable Date, the interests and short positions of Dr. Lo Wing Yan, William, JP, Ms. Fung Suen Lai, Jacqueline, Mr. Chau, Stephen and Mr. Chan Koon Chung, Johnny in the Shares, underlying Shares and debentures of the Company or any associated companies (within the meanings of Part XV of the SFO) as recorded in the registers of interests and short positions of directors and chief executives maintained by the Company pursuant to section 352 of the SFO were as follows:

Long positions in the underlying Shares of equity derivatives of the Company

Name of Directors	Capacity	Date of grant	Number of underlying Shares attributable to			Approximate percentage of issued Shares
			Pool A Options (Note 1)	Pool B Options (Note 1)	Total
Dr. Lo Wing Yan, William, JP	Beneficial owner	25 April, 2002	1,800,000	500,000	2,300,000	0.5717%
Ms. Fung Suen Lai, Jacqueline	Beneficial owner	25 April, 2002	-	500,000	500,000	0.1243%
Mr. Chau, Stephen	Beneficial owner	25 April, 2002	-	500,000	500,000	0.1243%
Mr. Chan Koon Chung, Johnny	Beneficial owner	25 April, 2002	-	500,000	500,000	0.1243%

Note 1: These options were granted pursuant to the Pre-IPO share option scheme of the Company adopted on 25 April, 2002. Pool A Options are options granted at the exercise price of 10% of the Placing Price (as defined in the prospectus issued by the Company on 30 April, 2002) and Pool B Options are options granted at the exercise price of 70% of the Placing Price.

Other than those disclosed above, there is no information to be disclosed pursuant to any of the requirements of Rule 17.50(2) of the Listing Rules, and there is no other matter which need to be brought to the attention of Shareholders.

PROCEDURE BY WHICH A POLL MAY BE DEMANDED

In accordance with Article 80 of the Articles of Association, the following persons may demand that the vote in respect of any resolution put to the general meeting be taken on a poll:

(a) the chairman of the meeting; or
(b) at least five members present in person or by proxy and entitled to vote or who represent in aggregate not less than one-tenth of the total voting rights of all members having the right to attend and vote at the meeting; or

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LETTER FROM THE BOARD OF DIRECTORS

(c) any member or members present in person or by proxy and holding Shares conferring a right to attend and vote at the meeting on which there have been paid up sums in the aggregate equal to not less than one-tenth of the total sum paid up on all Shares conferring that right.

A poll may be so demanded before or on the declaration of the result of the show of hands.

GENERAL INFORMATION

The Notice is contained in the Annual Report which is despatched to the Shareholders together with this circular.

A form of proxy for the Annual General Meeting is enclosed with the Annual Report. Whether or not you intend to be present at the Annual General Meeting, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon to the Company's share registrar in Hong Kong, Tengis Limited, at 26th Floor, Tesbury Centre, 28 Queen's Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding the Annual General Meeting or any adjourned meeting (as the case may be). Completion and deposit of the form of proxy will not preclude you from attending and voting at the Annual General Meeting or any adjourned meeting (as the case may be) should you so wish.

RECOMMENDATION

The Directors are of the opinion that the proposals referred to in this circular are in the best interests of the Company and the Shareholders and therefore recommend you to vote in favour of the Resolutions Nos. 4A to 4C to be proposed at the Annual General Meeting.

Yours faithfully,

By order of the Board

Panorama International Holdings Limited

Fung Yu Hing, Allan

Chairman

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APPENDIX

EXPLANATORY STATEMENT

This is an explanatory statement given to all Shareholders relating to the Resolution No. 4B to be proposed at the Annual General Meeting granting the Repurchase Mandate.

1. EXERCISE OF THE REPURCHASE MANDATE

As at the Latest Practicable Date, the issued and fully-paid share capital of the Company comprised 402,300,000 Shares.

Subject to the passing of the Resolution No. 4B and on the basis that no further Shares are issued or repurchased by the Company prior to the Annual General Meeting, the Company would be allowed under the Repurchase Mandate to repurchase a maximum of 40,230,000 Shares during the period from the date of passing of the Resolution No. 4B as set out in the Notice up to (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 any applicable laws or the Articles of Association to be held; or (iii) the revocation, variation or renewal of the Repurchase Mandate by ordinary resolution of the Shareholders in general meeting, whichever occurs first.

1. REASONS FOR REPURCHASES

Although the Directors have no present intention of repurchasing any Shares, they believe that the Repurchase Mandate 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 repurchase will benefit the Company and the Shareholders.

1. FUNDING OF REPURCHASES

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with its Memorandum and Articles of Association, the Listing Rules and the applicable laws and regulations of the Cayman Islands. The Company may not purchase its own securities on the GEM for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange from time to time.

1. IMPACT ON WORKING CAPITAL OR GEARING POSITION

The Directors consider that 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 financial statements contained in the Annual Report) in the event that the Repurchase Mandate is exercised in full. However, the Directors do not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or on its gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

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APPENDIX

EXPLANATORY STATEMENT

5. SHARE PRICES

The highest and lowest prices at which the Shares were traded on the GEM during each of the previous twelve months before the Latest Practicable Date were as follows:

	Shares
	Highest
HK’$	Lowest
HK’$
June 2005	0.090	0.065
July 2005	0.100	0.079
August 2005	0.089	0.089
September 2005	0.089	0.082
October 2005	0.082	0.082
November 2005	0.082	0.070
December 2005	0.079	0.062
January 2006	0.094	0.079
February 2006	0.094	0.070
March 2006	0.094	0.070
April 2006	0.096	0.080
May 2006	0.088	0.075
From 1 June, 2006 to the Latest Practicable Date	0.060	0.045

6. UNDERTAKING

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

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates (as defined in the Listing Rules), has any present intention to sell any Shares to the Company under the Repurchase Mandate if such is approved by the Shareholders.

As at the Latest Practicable Date, no connected person (as defined in the Listing Rules) has notified the Company that he/she/it has a present intention to sell his/her/its Shares to the Company, nor has undertaken not to do so, in the event that the Repurchase Mandate is approved by the Shareholders.

7. THE HONG KONG CODES ON TAKEOVERS AND MERGERS

If a Shareholder’s proportionate interest in the voting rights of the Company increases as a result of a share repurchase, such increase will be treated as an acquisition for the purposes of Rule 32 of the Code. As a result, a Shareholder, or a group of Shareholders acting in concert (within the meaning under the 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 Code.

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APPENDIX

EXPLANATORY STATEMENT

As at the Latest Practicable Date, Mr. Fung Yu Hing, Allan and parties acting in concert with him are interested or deemed to be interested in an aggregate of 251,671,500 Shares, representing approximately 62.56% of the existing issued share capital of the Company. In the event that the Directors exercise in full the power to repurchase Shares under the proposed Repurchase Mandate, the shareholding of Mr. Fung Yu Hing, Allan and parties acting in concert with him in the Company will be increased to approximately 69.51% of the issued share capital of the Company. The Directors are not aware of any consequence which may arise under the Code as a result of any purchase to be made under the Repurchase Mandate.

The Directors have no present intention to exercise the Repurchase Mandate to such an extent which would affect the minimum public float of the Shares under the Listing Rules.

8. SHARE PURCHASE MADE BY THE COMPANY

No purchases of Shares have been made by the Company in the previous six months preceding the Latest Practicable Date, whether on the Stock Exchange or otherwise.

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