Imperium Financial Group Limited — Proxy Solicitation & Information Statement 2002

Jul 2, 2002

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 L. P. Lammas International Limited (the “Company”), 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 was effected for transmission to the purchaser or the transferee.

The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) 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.

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L. P. LAMMAS INTERNATIONAL LIMITED

(incorporated in Cayman Islands with limited liability)

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES

This circular, for which the directors of the Company 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 of the Company, 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 at www.hkgem.com on the “Latest Company Announcement” page for at least 7 days from its date of publication.

28th June 2002

LETTER FROM THE BOARD OF DIRECTORS

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L. P. LAMMAS INTERNATIONAL LIMITED

(incorporated in Cayman Islands with limited liability)

Executive Directors: Pong Wai Yan (Chairman) Kan Siu Lun (Chief Executive Officer) Yu Yan Chun

Non-Executive Directors: Chan Man Hung Leung Chi-Kin, Stewart

Registered office: Century Yard Cricket Square Hutchins Drive P.O. Box 2681GT George Town Grand Cayman British West Indies

Independent Non-Executive Directors: Yu Yuk Ying, Vivian Lo King Yau, Edwin Leung Wai Man, Raymond

Principal place of business in Hong Kong: 23rd Floor Hing Wai Building 36 Queen’s Road Central Hong Kong

28th June 2002

To the shareholders

Dear Sir or Madam,

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES

INTRODUCTION

The directors of the Company (“Directors”) would like to seek the approval of Shareholders to grant general mandates to issue and to repurchase Shares at the forthcoming annual general meeting of the Company convened to be held at the 12th Floor, Club Lusitano, 16 Ice House Street, Central, Hong Kong on Friday, 16th August 2002 at 2:30 p.m. (“AGM”).

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LETTER FROM THE BOARD OF DIRECTORS

The purpose of this circular is to provide you with information relating to the ordinary resolutions nos. 4 to 6 (the “Ordinary Resolution nos. 4, 5 and 6 respectively) to be proposed at the AGM (i) to grant to the Directors a general mandate (“New Issue Mandate”) to allot, issue and deal with new Shares up a maximum of 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the Ordinary Resolution no. 4, (ii) to grant to the Directors a general mandate (“Repurchase Mandate”) to exercise the powers of the Company to repurchase the Company’s fully paid up Shares representing up to a maximum of 10% of the aggregate nominal amount of the issued shares capital of the Company as at the date of passing of the Ordinary Resolution no. 5 and (iii) to increase the aggregate nominal amount of share capital of the Company which the Directors may issue under the New Issue Mandate if given in the Ordinary Resolution no. 4 by the aggregate nominal amount of share capital of the Company repurchased under the Repurchase Mandate if given in the Ordinary Resolution no. 5.

Under the GEM Listing Rules, the Company is required to give its Shareholders all information which is reasonably necessary to enable Shareholders to make an informed decision as to whether to vote for or against the resolutions to grant to the Directors of the New Issue Mandate and the Repurchase Mandate. The explanatory statement required by the GEM Listing Rules to be included in this circular is set out in this Appendix.

The Company has in issue an aggregate of 800,000,000 Shares as at 28th June 2002, being the latest practicable date (the “Latest Practicable Date”) prior to the printing of this circular.

Subject to the passing of the Ordinary Resolution no. 4 and in accordance with the terms therein, the Company would be allowed to allot additional Shares up to the aggregate nominal amount of a maximum of 160,000,000 Shares on the basis that no further Shares will be issued or repurchased prior to the AGM.

ACTION TO BE TAKEN

Details of the proposed Ordinary Resolution nos. 4, 5 and 6 are contained in the notice (the “Notice”) convening the AGM. The Notice and a proxy form for use at the AGM are enclosed with the 2002 Annual Report. To be valid, the proxy form must be completed in accordance with the instructions printed thereon and deposited at the office of the Company’s Hong Kong branch share register, Tengis Limited at 4th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong not less than 48 hours before the time appointed for the AGM or any adjourned meeting. Completion and delivery of the proxy form will not preclude you from attending and voting in person at the AGM if you so wish.

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LETTER FROM THE BOARD OF DIRECTORS

RECOMMENDATION

The Directors believe that the granting of general mandate to allot, issue and deal with new Shares and to repurchase Shares are in the best interests of the Company and its Shareholders. The general mandate may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value per share and/or earnings per share of the Company and will only be made when the Directors believe that a repurchase of Shares will benefit the Company and its Shareholders.

An exercise of the Repurchase Mandate in full could have a material adverse impact on the working capital and gearing position of the Company compared with that as at 31st March 2002, being the date of its last audited accounts. The Directors do not, however, intend to make any repurchase in circumstances that would have a material adverse impact on the working capital or gearing of the Company.

Accordingly, the Directors recommend that all its Shareholders should vote in favour of the Ordinary Resolution nos. 4 to 6 be proposed at the AGM.

Yours faithfully,

Pong Wai Yan, Louis Chairman

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EXPLANATORY STATEMENT

APPENDIX

This is an explanatory statement given to all Shareholders relating to a resolution to be proposed at the forthcoming Annual General Meeting authorizing the Repurchase Mandate.

This explanatory statement contains all the information required pursuant to Rule 13.08 and other relevant provisions of the Rules Governing the Listing of Securities on GEM (the “GEM Listing Rules”) which is set out as follows:

1. REGULATIONS OF THE GEM LISTING RULES

(a) Shareholders’ approval

All repurchase of securities on the GEM by a company with its primary listing on the GEM must be approved in advance by an ordinary resolution, either by way of general mandate or by specific approval in relation to specific transactions.

(b) Source of funds

Any repurchase must be financed out of funds legally available for the purpose in accordance with the Company’s constitutive documents and the laws of the jurisdiction in which the Company is incorporated or otherwise established.

(c) Trading restrictions

The shares to be repurchased by a company must be fully paid up. A company is authorized to repurchase on the GEM or on any other stock exchange recognized for this purpose by the Securities and Futures Commission in Hong Kong and the Stock Exchange the total number of shares which represent up to a maximum of 10% of the existing issued share capital of that company or warrants to subscribe for or purchase shares in the company representing up to 10% of the amount of warrants then outstanding at the date of the passing of the relevant resolution granting the repurchase mandate. A company may not issue or announce a proposed issue of new securities of the type that has been repurchased for a period of 30 days immediately following a repurchase of securities whether on the GEM or otherwise (except pursuant to an exercise of warrants, share options or similar instruments requiring the company to issue securities which were outstanding prior to such repurchase) without the prior approval of the Stock Exchange. A company is also prohibited from making securities repurchases on the GEM if the result of the repurchase would be that the number of that company’s listed securities which are in the hands of the public would fall below the relevant prescribed minimum percentage for that company as determined by the Stock Exchange.

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EXPLANATORY STATEMENT

APPENDIX

In addition, the purchase price should not be higher than the latest (or current) independent bid price or the last independent sale (contract) price quoted or reported on the system (as defined in the Rules of the Stock Exchange), whichever is higher. A company shall not make the opening bid or any bid in the last 30 minutes before the close of normal trading hours as stipulated in Rules of the Stock Exchange.

(d) Status of repurchased securities

The listing of all repurchased securities (whether on the GEM or otherwise) is automatically cancelled and the relative certificates must be cancelled and destroyed. Under Cayman Islands law, a company’s repurchased shares shall be reduced by the aggregate nominal value of the repurchased shares accordingly although the authorized share capital of the company will not be reduced.

(e) Suspension of repurchase

A company shall not purchase its own securities after a price-sensitive development has occurred or has been the subject of a decision until the pricesensitive information is made publicity available. In particular, during the period of one month immediately preceding either the preliminary announcement of a company’s annual results or the publication of the company’s half-year report or quarterly report, a company may not purchase its securities on the GEM unless the circumstances are exceptional. In addition, the Stock Exchange may prohibit repurchases of securities on the GEM if a company has breached the GEM Listing Rules.

(f) Reporting requirements

Repurchases of securities on the GEM or otherwise must be reported to the Stock Exchange not later than 9:30 a.m. (Hong Kong time) on the following business day. In addition, a company’s annual report and accounts are required to include a monthly breakdown of securities repurchases made during the financial year under review, showing the number of securities repurchased each month (whether on the GEM or otherwise), the purchase price per share or the highest and lowest prices paid for all such repurchases and the total prices paid. The directors’ report is also required to contain reference to the purchases made during the year and the directors’ reasons for making such purchases. The company shall make arrangements with its broker who effects the purchase to provide the company in a timely fashion the necessary information in relation to the purchase made on behalf of the company to enable the company to report to the Stock Exchange. A company shall procure that any broker appointed by it to effect the purchase of securities shall disclose to the Stock Exchange such information with respect to purchases made on behalf of the company as the Stock Exchange may request.

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EXPLANATORY STATEMENT

APPENDIX

(g) Connected parties

Under the GEM Listing Rules, a company shall not knowingly purchase shares from a connected person (as defined under the GEM Listing Rules) and a connected person shall not knowingly sell his shares to the company. As at 28th June 2002, the latest practicable date prior to the printing of this circular (the “Latest Practicable Date”) and to the best of the knowledge of the Directors having made all reasonable enquiries, none of the Directors or their respective associates or any other connected persons (as defined in the GEM Listing Rules) has a present intention or has undertaken not, in the event that the Repurchase Mandate is approved by the Shareholders, to sell shares to the Company.

2. EXERCISE OF THE REPURCHASE MANDATE

Exercise in full of the Repurchase Mandate, on the basis of 800,000,000 shares in issue as at the Latest Practicable Date, could result in up to 80,000,000 shares being repurchased by the Company during the period from the passing of Resolution no. 5 as set out in the notice of the Annual General Meeting 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 the articles of association of the Company or any applicable laws 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.

3. REASONS FOR THE REPURCHASE

The Directors believe that the Repurchase Mandate is in the best interests of the Company and its subsidiaries. An exercise of the Repurchase Mandate may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value per share and/or earnings per share of the Company and will only be made when the Directors believe that a repurchase of Shares will benefit the Company and its shareholders.

4. 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 and the applicable laws 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.

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EXPLANATORY STATEMENT

APPENDIX

5. 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 GEM Listing Rules, the memorandum and articles of association of the Company and the applicable laws of the Cayman Islands.

6. THE HONG KONG CODE ON TAKEOVER 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 increases will be treated as an acquisition for the purposes of the Hong Kong Code on Takeovers and Mergers (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 Rules 26 and 32 of the Code.

As at the Latest Practicable Date, Mr Pong Wai Yan, who is a substantial shareholder of the Company through his interest in WYP Holdings Limited, was interested in 636,400,000 shares, representing 79.55% of the issued share capital of the Company. In the event that the Directors should exercise in full the power to repurchase Shares which is proposed to be granted pursuant to the Repurchase Mandate, the shareholding of Mr Pong Wai Yan in the Company would be increased to 88.39% of the issued share capital of the Company. Such increase would not give rise to an obligation to make a mandatory offer under Rule 26 and 32 of the Code. In fact, the Directors do not have a present intention to exercise in full the power to repurchase Shares of the Company or to exercise the Repurchase Mandate to such an extent as would result in the number of Shares held by the public being reduced to less than 20%.

Save as disclosed above, no person has notified the Company that it has an interest amounting to 10% or more of the issued share capital of the Company as at the Latest Practicable Date pursuant to Section 16(1) of the Securities (Disclosure of Interests) Ordinance.

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EXPLANATORY STATEMENT

APPENDIX

7. SHARE PRICES

The highest and lowest prices at which the Shares have traded on GEM in each of the twelve month ending preceding the Latest Practicable Date:

Month	Highest	Lowest
	HK$	HK$
2001
June	0.140	0.092
July	0.128	0.098
August	0.193	0.112
September	0.229	0.116
October	0.204	0.094
November	0.110	0.098
December	0.095	0.051
2002
January	0.065	0.065
February	0.073	0.073
March	0.079	0.062
April	0.060	0.060
May	0.062	0.044

8. CONNECTED PERSON

No connected person (as defined in the GEM Listing Rules) has notified the Company that it has a present intention to sell shares to the Company, or has undertaken not to do so, in the event that the Repurchase Mandate is approved by the Shareholders.

9. SHARE REPURCHASES MADE BY THE COMPANY

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

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NOTICE OF ANNUAL GENERAL MEETING

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L. P. LAMMAS INTERNATIONAL LIMITED

(incorporated in Cayman Islands with limited liability)

NOTICE IS HEREBY GIVEN that an Annual General Meeting of the members of L. P. Lammas International Limited (the “Company”) will be held at 12th Floor, Club Lusitano, 16 Ice House Street, Central, Hong Kong on Friday, 16th August, 2002 at 2:30 p.m. for the following purposes:

1. To receive and consider the audited consolidated financial statements and the reports of the directors of the Company (“the Directors”) and of the auditors for the year ended 31st March, 2002;

2. To re-elect Directors and to authorize the board of Directors (“the Board”) to fix the Directors’ remuneration;

3. To re-appoint auditors and to authorize the Board to fix their remuneration;

4. To consider as special business and, if thought fit, pass with or without amendments, the following resolution as an ordinary resolution:

“ THAT

• (a) subject to paragraph (c) of this resolution, the exercise by the Directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with unissued shares in the capital of the Company and to make or grant offers, agreements and options which might require the exercise of such power be and is hereby generally and unconditionally approved;

• (b) the approval in paragraph (a) shall authorise the directors of the Company during the Relevant Period (as hereinafter defined) to make or grant offers, agreements and options which might require the exercise of such power after the end of the Relevant Period;

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NOTICE OF ANNUAL GENERAL MEETING

• (c) 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) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined), (ii) any issue of shares upon exercise of rights of subscription or conversion attaching to any warrants of the Company or any securities which are convertible into Shares; or (iii) the grant of options under the share option scheme (the “Share Option Scheme”) adopted by the Company or the exercise of any of the subscription rights attaching to any options that have been or may be granted under the Share Option Scheme; or (iv) any scrip dividend scheme or similar arrangement providing for allotment of shares in lieu of the whole or part of any dividend in accordance with the articles of association of the Company, shall not exceed the sum of 20% of the aggregate nominal amount of the share capital of the Company in issue;

• (d) for the purposes of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earlier 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 law to be held; or

• (iii) the revocation or variation of this resolution by an ordinary resolution of the shareholders of the Company in general meeting; and

“Rights Issue” means an offer of shares in the capital of the Company or an offer or issue of warrants or options or similar instruments to subscribe for shares in the capital of the Company open for a period fixed by the Directors to shareholders whose names appear on the Company’s register of members on a fixed record date in proportion to their then holdings of shares in the Company (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, or the requirements of, any recognised regulatory body or any stock exchange in, or in any territory outside Hong Kong or the expense or delay that may be incurred in the determination of any such restrictions or obligations).”

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NOTICE OF ANNUAL GENERAL MEETING

1. To consider as special business and, if thought fit, pass with or without amendments, the following resolution as an ordinary resolution:

“ THAT

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

• (b) the aggregate nominal amount of shares of the Company authorized to be repurchased by the Company pursuant to the approval in paragraph (a) of this resolution during the Relevant Period shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company at the date of the passing of this resolution and the authority pursuant to paragraph (a) of this resolution shall be limited accordingly; and

• (c) for the purposes of this resolution:

“Relevant Period” means the period from the passing of this resolution until whichever is the earlier 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 law to be held; or

• (iii) the revocation or variation of this resolution by an ordinary resolution of the shareholders of the Company in general meeting;”

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NOTICE OF ANNUAL GENERAL MEETING

1. To consider as special business and, if thought fit, pass with or without amendments, the following resolution as an ordinary resolution:

“ THAT conditional upon resolutions nos. 4 and 5 above being passed, the unconditional general mandate granted to the Directors of the Company to allot, issue and deal with additional shares and to make or grant offers, agreements, and options which might require the exercise of such powers pursuant to resolution no. 4 above be and is hereby extended by the addition thereto of an amount representing the aggregate nominal amount of the share capital of the Company repurchased by the Company under the authority granted pursuant to resolution no. 5 above, provided that such amount shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company at the date of the passing of the said resolution.”

By Order of the Board

Kuo Kwan Company Secretary

Hong Kong, 28th June, 2002

Registered office: Principal place of business: Century Yard, Cricket Square 23rd Floor, Hutchins Drive, P.O. Box 2681GT Hing Wai Building, George Town, Grand Cayman 36 Queen’s Road, British West Indies Central, Hong Kong

Notes:

• (i) A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and vote on his/her behalf. A proxy need not be a member of the Company.

• (ii) The instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed, or a certified copy of such power or authority, must be lodged with the Company’s Branch Share Registrar in Hong Kong, Tengis Limited at 4th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong not less than 48 hours before the time fixed for holding the meeting.

• (iii) Delivery of an instrument appointing a proxy should not preclude a member from attending and voting in person at the meeting and in such event, the instrument appointing a proxy shall be deemed to be revoked.

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