Keymed Biosciences Inc. — Proxy Solicitation & Information Statement 2006

Jul 31, 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 Suga International Holdings Limited, you should at once hand this circular and the enclosed form of proxy to the purchaser or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or 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.

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SUGA INTERNATIONAL HOLDINGS LIMITED 信佳國際集團有限公司[] (Incorporated in Bermuda with limited liability) (Stock Code: 912)*

RE-ELECTION OF DIRECTORS, AMENDMENTS TO THE BYE-LAWS, GRANT OF GENERAL MANDATES TO ISSUE SECURITIES AND REPURCHASE SHARES AND

NOTICE OF ANNUAL GENERAL MEETING

A copy of the notice of the annual general meeting of Suga International Holdings Limited to be held at Room 3203, 32/F., Admiralty Centre I, 18 Harcourt Road, Hong Kong on 25 August 2006 at 4:00 p.m. is set out on pages 16 to 22 of this circular. If you are not able to attend the annual general meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return it together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of such power of authority to the Company’s branch registrar and registration office in Hong Kong, Computershare Hong Kong Investor Services Limited, at 46th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for the holding of the annual general meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from voting at the annual general meeting or any adjournment thereof should you so wish.

31 July 2006

* For identification purposes only

CONTENTS

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Amendments to the Bye-laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Grant of general mandates to issue securities and repurchase Shares . . . . . . . .	5
AGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Poll procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Further Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
APPENDIX I – Details of Director to be re-elected. . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
APPENDIX II – Explanatory statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Notice of the AGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings (other than in the notice of the AGM):

“AGM”	the annual general meeting of the Company to be held
	at Room 3203, 32/F., Admiralty Centre I, 18 Harcourt
	Road, Hong Kong on 25 August 2006 at 4:00 p.m.
“associate”	has the meaning ascribed to it under the Listing Rules
“Board”	the board of Directors
“business day”	any day on which the Stock Exchange is open for the
	business of dealing in securities
“Bye-laws”	the bye-laws of the Company for the time being
“Company”	Suga International Holdings Limited, an exempted
	company incorporated in Bermuda with limited
	liability, the shares of which are listed on the Main
	Board of the Stock Exchange
“Companies Act”	the Companies Act 1981 of Bermuda
“Corporate Governance Code”	the Code on Corporate Governance Practices as set
	out in Appendix 14 of the Listing Rules
“Directors”	the directors of the Company for the time being
“Group”	the Company and its subsidiaries from time to time
“Hong Kong”	the Hong Kong Special Administrative Region of the
	People’s Republic of China
“Latest Practicable Date”	25 July 2006, being the latest practicable date prior to
	the printing of this circular for ascertaining certain
	information contained herein
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange
“Repurchase Code”	the Hong Kong Code on Share Repurchases
“SFO”	the Securities and Futures Ordinance (Chapter 571 of
	the Laws of Hong Kong)
“Share(s)”	ordinary share(s) of HK$0.10 each in the share capital
	of the Company

– 1 –

DEFINITIONS

“Shareholder(s)”

holder(s) of Share(s)

“Stock Exchange” The Stock Exchange of Hong Kong Limited “Takeovers Code” the Hong Kong Code on Takeovers and Mergers “HK$” and “cents” Hong Kong dollars and cents respectively “%” per cent.

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LETTER FROM THE BOARD

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SUGA INTERNATIONAL HOLDINGS LIMITED 信佳國際集團有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 912)

Executive Directors: Mr. Ng Chi Ho (Chairman) Mr. Ma Fung On (Deputy Chairman) Mr. Wong Wai Lik, Lamson

Independent non-executive Directors: Professor Wong Sook Leung, Joshua Mr. Murase Hiroshi Mr. Leung Yu Ming, Steven

Registered office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Principal place of business in Hong Kong: Units 1904-7, 19th Floor Chevalier Commercial Centre 8 Wang Hoi Road Kowloon Bay Kowloon Hong Kong

31 July 2006

To the Shareholders

Dear Sir or Madam,

RE-ELECTION OF DIRECTORS, AMENDMENTS TO THE BYE-LAWS, GRANT OF GENERAL MANDATES TO ISSUE SECURITIES AND REPURCHASE SHARES AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information regarding resolutions to be proposed at the AGM relating to (i) the re-election of retiring Directors; (ii) the proposed amendments to the existing Bye-laws; (iii) the granting to the Directors of general mandates for the issue of securities and repurchase of Shares and (iv) the extension of general mandates to issue additional securities.

* For identification purposes only

– 3 –

LETTER FROM THE BOARD

RE-ELECTION OF DIRECTORS

The Board currently consists of six Directors, namely Mr. Ng Chi Ho, Mr. Ma Fung On, Mr. Wong Wai Lik, Lamson, Professor Wong Sook Leung, Joshua, Mr. Murase Hiroshi and Mr. Leung Yu Ming, Steven.

Pursuant to Bye-law 111 of the Bye-laws, at each annual general meeting, one-third of the Directors for the time being, or, if their number is not three or a multiple of three, then the number nearest to but not exceeding one-third, shall retire from office by rotation provided that no Director holding office as chairman or deputy chairman or the office of managing Director or joint managing Director shall be subject to retirement by rotation or be taken into account in determining the number of Directors to retire in each year. A retiring Director shall be eligible for re-election. The Directors to retire by rotation shall include (so far as necessary to obtain the number required) any Director who wishes to retire and not to offer himself for re-election. Any further Directors so to retire shall be those who have been longest in office since their last re-election or appointment and so that as between persons who became or were last re-elected Directors on the same day those to retire shall (unless they otherwise agree among themselves) be determined by lot.

Pursuant to Bye-law 111(A) of the Bye-laws, Professor Wong Sook Leung, Joshua shall retire at the AGM who shall then be eligible for re-election.

The Listing Rules have been amended by the Stock Exchange by replacing the Code of Best Practice in Appendix 14 by the new Corporate Governance Code and adding a new Appendix 23 on the requirements for a Corporate Governance Report to be included in the annual reports of listed issuers. Subject to certain transitional arrangements, the amendments took effect on 1 January 2005.

Pursuant to Code Provision A.4.2 of the Corporate Governance Code, every director, including those appointed for a specific term, should be subject to retirement by rotation at least once every three years. In order to comply with the said Code Provision, Mr. Ng Chi Ho, Mr. Ma Fung On and Mr. Murase Hiroshi shall voluntarily retire at the AGM who shall then be eligible for re-election.

Brief biographical details of the retiring Directors are set out in Appendix I to this circular.

AMENDMENTS TO THE BYE-LAWS

Following a review of the Company’s corporate governance practices with reference to Corporate Governance Code, the Directors propose to amend (i) the existing Bye-law 73 of the Bye-laws to the effect that a Director or Directors who, individually or collectively, hold proxies in respect of shares representing 5% or more of the total voting rights at a particular meeting shall demand a poll in certain circumstances where, on a show of hands, a meeting votes in the opposite manner to that instructed in those proxies; (ii) the existing Bye-law 111(A) of the Bye-laws to the effect that every Director shall retire by rotation at least once every three years; (iii) the existing Bye-law 114 of the Bye-laws to the

– 4 –

LETTER FROM THE BOARD

effect that Directors elected by Shareholders either to fill a causal vacancy or as an additional Director will be taken into account in determining which particular Directors or the number of Directors who are to retire by rotation; (iv) the existing Bye-law 115 of the Bye-laws to the effect that persons appointed by the Directors to fill a causal vacancy on the Board shall hold office only until the next following general meeting of the Company; (v) the existing Bye-law 178 of the Bye-laws to the effect that the requirements to send copies of the full annual report or a summary financial report shall be deemed to be satisfied where the Company publishes copies of the annual report and, if applicable, a summary financial report on the Company’s computer network or in any other permitted manner (including by sending any form of electronic communication); and (vi) the existing Bye-law 197 of the Bye-laws to the effect that the Directors may authorise the destruction of share certificate, dividend mandate, instrument of transfer 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.

In addition, pursuant to the announcement made by the Stock Exchange dated 14 February 2006, certain minor and housekeeping amendments to the Listing Rules came into effect on 1 March 2006, inter alia, permitting the removal of Directors by ordinary resolution. Accordingly, the Directors propose to amend the Bye-laws 108 and 117 of the Bye-laws to ensure compliance with such amendments to the Listing Rules.

A copy of the draft new Bye-laws is available for inspection during normal business hours at the principal place of business of the Company at Units 1904-7, 19th Floor, Chevalier Commercial Centre, 8 Wang Hoi Road, Kowloon Bay, Kowloon, Hong Kong from the date of this circular up to and including the date of the AGM and at the AGM.

The full text of the proposed amendments to the Bye-laws is set out in special resolution no. 4 in the notice of the AGM set out on pages 16 to 22 of this circular.

GRANT OF GENERAL MANDATES TO ISSUE SECURITIES AND REPURCHASE SHARES

At the annual general meeting of the Company held on 26 August 2005, ordinary resolutions were passed granting general mandates to the Directors, inter alia , (a) to allot, issue or otherwise deal with securities of the Company not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company as at that date (“ Existing Issue Mandate ”); and (b) to repurchase Shares not exceeding 10% of the aggregate nominal amount of the share capital of the Company in issue as at that date (“ Existing Repurchase Mandate ”).

The Existing Issue Mandate and the Existing Repurchase Mandate will lapse upon the conclusion of the AGM. New general mandates to allot, issue or otherwise deal with securities of the Company up to 20% and to repurchase Shares up to 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of the resolutions as set out in resolutions nos. 5 and 6 respectively will be proposed at the AGM. Resolution authorising the extension of the general mandate to the Directors to issue securities to include the aggregate nominal amount of such securities (if any) repurchased under the mandate is to be proposed as resolution no. 7 at the AGM.

– 5 –

LETTER FROM THE BOARD

An explanatory statement containing the particulars required by the Listing Rules to enable the Shareholders to make an informed view on whether to vote for or against resolutions nos. 5, 6, and 7 to be proposed at the AGM in relation to the proposed general mandates to issue securities and repurchase Shares are set out in Appendix II to this circular.

AGM

Set out on pages 16 to 22 is a notice convening the AGM to be held at Room 3203, 32/F., Admiralty Centre I, 18 Harcourt Road, Hong Kong on 25 August 2006 at 4:00 p.m. at which resolutions will be proposed to the Shareholders in respect of, inter alia, the approval and adoption of the audited financial statements and reports of the Directors and auditors of the Company for the year ended 31 March 2006, the re-election of the retiring Directors, the proposed amendments to the Bye-laws, the granting of the general mandates to issue securities and repurchase Shares and the extension of general mandates to issue additional securities.

A form of proxy for use at the AGM is enclosed. If you are not able to attend and/or vote at the AGM in person, you are requested to complete and return the form of proxy to the Company’s branch registrar and registration office in Hong Kong, Computershare Hong Kong Investor Services Limited at 46th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for the holding of the AGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM or any adjourned meeting should you so wish.

POLL PROCEDURE

Pursuant to the Bye-law 73 of the Bye-laws, at any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) 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 authorised 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 authorised representative) or by proxy and representing not less than one-tenth of the total voting rights of all Shareholders having the right to vote at the meeting; or

• (d) by any Shareholder or Shareholders present in person (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy and holding Shares conferring a right to vote at the meeting 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.

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LETTER FROM THE BOARD

RECOMMENDATION

The Directors consider that the re-election of the retiring Directors, the amendments to the Bye-laws, the granting of general mandates to issue securities and repurchase Shares and the extension of general mandates to issue additional securities are in the best interests of the Company and the Shareholders as a whole, and accordingly, recommend all Shareholders to vote in favour of the resolutions to be proposed at the AGM.

FURTHER INFORMATION

Your attention is drawn to the additional information set out in the Appendices to this circular. The English text of this circular shall prevail over the Chinese text.

Yours faithfully, For and on behalf of the Board Suga International Holdings Limited Ng Chi Ho Chairman

– 7 –

APPENDIX I

DETAILS OF DIRECTOR TO BE RE-ELECTED

Set out below are the biographical details of the retiring Directors who shall be eligible for re-election at the AGM:

Mr. NG Chi Ho , aged 56, is the founder of the Group, Chairman of the Company and an executive Director. He is responsible for the formulation of corporate strategy, strategic planning and development, and overall management of the Group. Mr. Ng has over 29 years of management experience in the electronics industry and has been a lecturer in electronic engineering at the Hong Kong Polytechnic University for 4 years. Mr. Ng holds a bachelor degree in science from the Chinese University and a master of philosophy degree in computer engineering from the University of Hong Kong. He is also a chartered engineer and a fellow of the Institution of Electrical Engineers, UK. In addition, Mr. Ng is a Director of the Applied Research Council, the HKSAR Government, Vice Chairman of Hong Kong Electronic Industries Association Limited (“HKEIA”) and the Chairman of the Technology and Application Sub-Committee of the HKEIA.

As at the Latest Practicable Date, Mr. Ng has the following interests in shares of the Company within the meaning of Part XV of the SFO.

(a) Interests in shares of the Company

Number of ordinary share of HK$0.1 each:

	Personal	Corporate	Family	Total
	interests	interests	interests	interests
Long position	2,000,000	31,650,000	100,000,000	133,650,000
		(Note 1)	(Note 2)
Notes:

1. 31,650,000 shares are held by Billion Linkage Limited, the entire issued shares of which is held by Mr. Ng and his spouse in equal share.

2. 100,000,000 shares are held by Superior View Inc., the entire issued shares of which is ultimately held by Fidelitycorp Limited as the trustee of the C.H. Family Trust, the beneficiaries of which are the family members of Mr. Ng Chi Ho.

(b) Interests in shares of the Company’s associated corporation

Non-voting deferred shares of HK$1 each in Suga Electronics Limited, a wholly owned subsidiary of the Company:

	Number of non-voting
Name of shareholder	deferred shares
Ng Chi Ho	3,680,000

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APPENDIX I

DETAILS OF DIRECTOR TO BE RE-ELECTED

Share options to subscribe:

	Date of	Number of		Exercise
	share options	share options	Exercise	price
	granted	outstanding	period	per share
Long position	7 May 2004	2,000,000	7 May 2004 –	1.23
			6 May 2009

Mr. Ng has entered into a service contract with the Company for a term of 3 years commencing from 1 September 2002 which will continue thereafter unless terminated by not less than three months’ notice in writing served by either party on the other. Pursuant to the service contract, Mr. Ng is currently entitled to an annual remuneration of approximately HK$2,556,000 (subject to yearly adjustment as determined by the Board from time to time with reference to the responsibilities and duties assumed by him) payable on monthly basis and a discretionary bonus as determined by the Board with reference to the performance and profitability of the Group. Mr. Ng did not hold any directorship in other listed companies in the last three years.

Mr. Ng is the brother-in-law of Mr. Lee Yiu Cheung, Alex, the Chief Financial Officer and Qualified Accountant of the Group.

Save as disclosed above, Mr. Ng does not have any relationships with any directors, senior management, substantial or controlling shareholders of the Company and does not have interests in shares of the Company within the meaning of Part XV of the SFO. Mr. Ng is not aware of any information to be disclosed pursuant to the requirements of Rule 13.51(2)(h)-(v) of the Listing Rules or any other matters that need to be brought to the attention of the shareholders of the Company pursuant to Rule 13.51(2)(w) of the Listing Rules.

Mr. MA Fung On , aged 48, is the Deputy Chairman of the Group and an executive Director. Mr. Ma is responsible for the overall strategic planning and operation of sales and personnel and administration of the Group. Mr. Ma has worked with the Group for more than 13 years and has over 24 years of experience in the electronics industry. He graduated from the Hong Kong Polytechnic University with a higher diploma in electronic engineering.

As at the Latest Practicable Date, Mr. Ma has the following interests in shares of the Company within the meaning of Part XV of the SFO.

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APPENDIX I

DETAILS OF DIRECTOR TO BE RE-ELECTED

(a) Interests in shares of the Company

Number of ordinary share of HK$0.1 each:

	Personal	Corporate	Total
	interests	interests	interests
Long position	730,000	9,000,000	9,730,000
		(Note 3)

Note:

3. 9,000,000 shares are held by Global Class Enterprises Limited, the entire issued share capital of which is held by Mr. Ma Fung On.

(b) Interests in shares of the Company’s associated corporation

Non-voting deferred shares of HK$1 each in Suga Electronics Limited, a wholly owned subsidiary of the Company:

			Number of	non-voting
Name of shareholder			deferred shares
Ma Fung On				240,000
Share options to subscribe
		Number of		Exercise
	Date of share	share options	Exercise	price
	optionsgranted	outstanding	period	per share
Long position	5 May 2003	1,070,000	5 May 2003 –	1.23
			4 May2008
Long position	7 May 2004	1,000,000	7 May 2004 –	1.23
			6 May2009
		2,070,000

(c) Share options to subscribe

Mr. Ma has entered into a service contract with the Company for a term of 3 years commencing from 1 April 2004 which will continue thereafter unless terminated by not less than three months’ notice in writing served by either party on the other. Pursuant to the service contract, Mr. Ma is currently entitled to an annual remuneration of approximately HK$1,005,000 (subject to yearly adjustment as determined by the Board from time to time with reference to the responsibilities and duties assumed by him) payable on monthly basis and a discretionary bonus as determined by the Board with reference to the performance and profitability of the Group. Mr. Ma did not hold any directorship in other listed companies in the last three years.

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APPENDIX I

DETAILS OF DIRECTOR TO BE RE-ELECTED

Mr. Ma does not have any relationship with any other Director, senior management, substantial shareholder or controlling shareholder of the Company.

Save as disclosed above, Mr. Ma does not have interests in shares of the Company within the meaning of Part XV of the SFO. Mr. Ma is not aware of any information to be disclosed pursuant to the requirements of Rule 13.51(2)(h)-(v) of the Listing Rules or any other matters that need to be brought to the attention of the shareholders of the Company pursuant to Rule 13.51(2)(w) of the Listing Rules.

Professor WONG Sook Leung, Joshua , aged 67, is an independent non-executive Director. Mr. Wong is presently the Professor Emeritus of the Hong Kong Polytechnic University. He has over 33 years of working experience with tertiary educational institutions including 28 years with the Hong Kong Polytechnic University of which 6 years as the vice president, 2 years as the senior consultant and chair professor in electronic and information engineering department and 16 years as the head of electronic engineering department. Prior to joining the Hong Kong Polytechnic University, he was an associate professor of California State University at Los Angeles, the US from 1968 to 1974. In addition, he was the president of the Hong Kong Association for the Advancement of Science and Technology in 1988/89. Mr. Wong is currently Chairman of the Semiconductor Industries Group in Hong Kong. Mr. Wong obtained his bachelor degree of science in engineering from the University of Hong Kong and his doctor of philosophy degree from Leeds University, UK. He is also a chartered engineer, a fellow of the Institution of Electrical Engineers, UK and a fellow of the Hong Kong Institution of Engineers.

Professor Wong’s appointment as an independent non-executive Director shall be for a term of one year commencing from 1 April 2006. Pursuant to the appointment letter, Professor Wong is currently entitled to an annual director fee of HK$200,000, which is determined by reference to his responsibilities and duties with the Company. Save as disclosed, Professor Wong did not hold any directorship in other listed companies in the last three years.

As at the Latest Practicable Date, Professor Wong has been granted 500,000 share options in the shares of the Company within the meaning of Part XV of the SFO and he does not have any relationship with any other Director, senior management, substantial shareholder or controlling shareholder of the Company.

Save as disclosed above, Professor Wong does not have interests in shares of the Company within the meaning of Part XV of the SFO. Professor Wong is not aware of any information to be disclosed pursuant to the requirements of Rule 13.51(2)(h)-(v) of the Listing Rules or any other matters that need to be brought to the attention of the shareholders of the Company pursuant to Rule 13.51(2)(w) of the Listing Rules.

– 11 –

APPENDIX I

DETAILS OF DIRECTOR TO BE RE-ELECTED

Mr. Hiroshi MURASE , aged 68, is an independent non-executive Director. Mr. Murase is currently an adviser of Yamato International Inc., Japan. He has 40 years of working experience in Japanese corporations including 34 years with Mitsubishi Corporation, Japan, of which about 13 years he worked in management as a general manager or at higher levels. Mr. Murase also has 14 years’ experience working outside Japan including 6 years as manager of the New York Office of Mitsubishi International Corporation, 4 years as general manager of the Foods Department of the London Office of Mitsubishi Corporation, and 4 years as president of Mitsubishi Corporation do Brazil, overseeing Mitsubishi Corporation’s business in South America. In addition, Mr. Murase was the senior managing director of Asahimatsu Food Co. Limited from 1995 to 2000. Mr. Murase graduated from Kobe University, Japan with a bachelor degree in business administration.

Mr. Murase’s appointment as an independent non-executive Director shall be for a term of one year commencing from 1 April 2006. Pursuant to the appointment letter, Mr. Murase is currently entitled to an annual director fee of HK$150,000, which is determined by reference to his responsibilities and duties with the Company. Save as disclosed, Mr. Murase did not hold any directorship in other listed companies in the last three years.

As at the Latest Practicable Date, Mr. Murase has been granted 500,000 share options in the shares of the Company within the meaning of Part XV of the SFO and he does not have any relationship with any other Director, senior management, substantial shareholder or controlling shareholder of the Company.

Save as disclosed above, Mr. Murase does not have interests in shares of the Company within the meaning of Part XV of the SFO. Mr. Murase is not aware of any information to be disclosed pursuant to the requirements of Rule 13.51(2)(h)-(v) of the Listing Rules or any other matters that need to be brought to the attention of the shareholders of the Company pursuant to Rule 13.51(2)(w) of the Listing Rules.

– 12 –

APPENDIX II

EXPLANATORY STATEMENT

This Appendix contains the particulars that are required by the Listing Rules to be included in an explanatory statement to enable the Shareholders to make an informed view on whether to vote for or against the resolutions to be proposed at the AGM in relation to the proposed mandate to repurchase Shares (the “Proposed Repurchase Mandate”).

1. Share Capital

As at the Latest Practicable Date, the issued share capital of the Company comprised 227,940,000 Shares. As at the same date, there were outstanding share options granted under the Company’s existing share option scheme entitling the holders thereof to subscribe for 13,030,000 Shares in total at an exercise price of HK$1.23 per Share.

Subject to the passing of the resolution granting the Proposed Repurchase Mandate and on the basis that no further Shares will be issued (whether generally or the exercise of outstanding options, if any) or repurchased before the AGM, the Company will be allowed to repurchase up to 22,794,000 Shares, representing 10% of the issued share capital of the Company as at the Latest Practicable Date, during the period ending on the earlier of the conclusion of the next annual general meeting of the Company or the date by which the next annual general meeting of the Company is required to be held by law or the date upon which such authority is revoked or varied by a resolution of the Shareholders in general meeting.

2. Reason for repurchase

The Directors believe that it is in the best interests of the Company and the Shareholders to have a general authority from the Shareholders to enable the Company to repurchase Shares on the market. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the Company’s net asset value and/or earnings per share and will only be made when the Directors believe that such a repurchase will benefit the Company and the Shareholders.

3. Funding of repurchase

Repurchases must be funded out of funds legally available for the purpose in accordance with the memorandum of association and the Bye-laws and the applicable laws of Bermuda. It is presently proposed that any repurchase of Shares would be financed entirely from the Company’s available cash flow or working capital facilities. Any repurchase will be made out of funds of the Company permitted to be utilised in this connection, including profits otherwise available for distribution.

The Directors expect 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 Company’s audited accounts for the year ended 31 March 2006 in the event that the Proposed Repurchase Mandate is exercised in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Proposed Repurchase Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital or gearing position of the Company which in the opinion of the Directors is from time to time appropriate for the Company.

– 13 –

APPENDIX II

EXPLANATORY STATEMENT

4. Share Price

The highest and lowest traded prices for Shares recorded on the Stock Exchange during each of the previous twelve months were as follows:

	Shares	Shares
Month	Highest	Lowest
	HK$	HK$
2005
July	0.770	0.650
August	0.820	0.610
September	0.880	0.750
October	0.900	0.830
November	0.850	0.750
December	0.830	0.670
2006
January	0.750	0.630
February	0.730	0.650
March	0.730	0.620
April	0.720	0.710
May	0.710	0.630
June	0.700	0.475
July (up to the Latest Practicable Date)	0.550	0.470

5. General

To the best of their knowledge and having made all reasonable enquiries, none of the Directors nor any of their associates currently intends to sell any Share to the Company or its subsidiaries in the event that the Company is authorised to make purchases of the Shares.

No connected person of the Company, as defined in the Listing Rules, has notified the Company that he has a present intention to sell any Share to the Company, or has undertaken not to do so in the event that the Company is authorised to make purchases of the Shares.

In the six months preceding the Latest Practicable Date, the Company had not repurchased any Share on the Stock Exchange or otherwise.

The Directors have undertaken to the Stock Exchange that they will exercise the Proposed Repurchase Mandate in accordance with the Listing Rules and the laws of Bermuda.

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APPENDIX II

EXPLANATORY STATEMENT

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 and Rule 6 of the Repurchase Code. Accordingly, a Shareholder, or 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 may become obliged to make a mandatory general offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, Superior View Inc., Billion Linkage Limited and Mr. Ng Chi Ho (collectively “Controlling Shareholders”) held approximately 43.87%, 13.89% and 0.87% of the existing issue share capital of the Company respectively and which in aggregate held approximately 58.63% of the existing issued share capital of the Company. If the Proposed Repurchase Mandate is exercised in full, the percentage interests in the Company of Superior View Inc., Billion Linkage Limited and Mr. Ng Chi Ho would increase to approximately 48.75%, 15.43%, and 0.97% respectively and the percentage interests in the Company of the Controlling Shareholders would in aggregate increase to approximately 65.15%. To the best knowledge and belief of the Directors, such increase in shareholding would not give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code. The Directors have no present intention to exercise the Proposed Repurchase Mandate to such extent as would result in the number of Shares in the hands of public falling below the prescribed minimum percentage of 25%.

Save as aforesaid, the Directors are not aware of any consequence which would arise under the Takeovers Code as a consequence of any repurchase pursuant to the Proposed Repurchase Mandate.

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NOTICE OF ANNUAL GENERAL MEETING

==> picture [122 x 48] intentionally omitted <==

SUGA INTERNATIONAL HOLDINGS LIMITED 信佳國際集團有限公司[*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 912)

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Suga International Holdings Limited (the “Company”) will be held at Room 3203, 32/F., Admiralty Centre I, 18 Harcourt Road, Hong Kong on 25 August 2006 at 4:00 p.m. for the following purposes:

1. To receive and adopt the audited financial statements and the reports of the directors (the “ Directors ”) and auditors for the year ended 31 March 2006;

2. To re-elect the retiring Director and authorise the board of Directors to fix the Directors’ remuneration;

3. To re-appoint auditors and to authorise the board of Directors to fix their remuneration; and

By way of special business, to consider, and if thought fit, to pass the following resolution, with or without modifications, as a special resolution:

SPECIAL RESOLUTION

1. “ THAT the Bye-laws of the Company be amended as follows:

2. (a) Bye-law 73

   • (i) by inserting the words “required by the stock exchange in the Relevant Territory or” after the words “a show of hands unless” in the first sentence of Bye-law 73;

   • (ii) by deleting the full stop at the end of the paragraph (iv) of Byelaw 73 and inserting the word “; or” in its place; and

* For identification purposes only

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NOTICE OF ANNUAL GENERAL MEETING

• (iii) by adding the following new paragraph immediately after paragraph (iv) of Bye-law 73:

  • “(v) if required by the rules of the stock exchange in the Relevant Territory, by any Director or Directors who, individually or collectively, hold proxies in respect of shares representing five percent (5%) or more of the total voting rights at such meeting.”;

• (b) Bye-law 108

by deleting the words “Special Resolution” in paragraph (vii) of Byelaw 108 and inserting the words “Ordinary Resolution” in their place;

• (c) Bye-law 111(A)

by substituting the existing Bye-law 111(A) with the following new Byelaw 111(A):

• “111(A) At each annual general meeting one-third of the Directors for the time being, or, if their number is not three or a multiple of three, then the number nearest to but not less than one-third, shall retire from office by rotation such that each Director (including those appointed for a specific term) shall be subject to retirement by rotation at least once every three years. A retiring Director shall be eligible for re-election. The Company at the general meeting at which a Director retires may fill the vacated office.”;

• (d) Bye-law 114

by substituting the existing Bye-law 114 with the following new Byelaw 114:

• “114 The Company may from time to time in general meeting by Ordinary Resolution elect any person to be a Director either to fill a casual vacancy or as an additional Director. Any Director so appointed shall hold office only until the next following general meeting of the Company and shall then be eligible for re-election at the meeting but shall be taken into account in determining the Directors or the number of Directors who are to retire by rotation at such meeting where it happens to be the next following annual general meeting.”;

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NOTICE OF ANNUAL GENERAL MEETING

(e) Bye-law 115

by deleting the sentence “Any Director so appointed shall hold office only until the next following annual general meeting of the Company and shall then be eligible for re-election at the meeting but shall not be taken into account in determining the Directors or the number of Directors who are to retire by rotation at such meeting.” commencing on the eighth line in the exiting Bye-law 115 and inserting the following in its place:–

“Any Director so appointed shall hold office only until the next following general meeting of the Company and shall then be eligible for re-election at the meeting but shall be taken into account in determining the Directors or the number of Directors who are to retire by rotation at such meeting where it happens to be the next following annual general meeting.”;

• (f) Bye-law 117

• (i) by replacing the word “Special” with “Ordinary” immediately after the words “The Company may by” on the first line in the existing Bye-law 117 and in the margin note to the existing Bye-law 117; and

• (ii) by deleting the sentence “Any person so elected shall hold office only until the next following annual general meeting of the Company and shall then be eligible for re-election, but shall not be taken into account in determining the Directors or the number of Directors who are to retire by rotation at such meeting.” commencing on the twelfth line in the existing Bye-law 117 and inserting the following in its place:

“Any person so elected shall hold office only until the next following general meeting of the Company and shall then be eligible for re-election, but shall be taken into account in determining the Directors or the number of Directors who are to retire by rotation at such meeting where it happens to be the next following annual general meeting.”;

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NOTICE OF ANNUAL GENERAL MEETING

• (g) Bye-law 178

By adding the following new paragraph (D) immediately after paragraph (C) of Bye-law 178:

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

• (h) Bye-law 197

• (i) by re-numbering the existing Bye-law 197 as paragraph (A) of Bye-law 197; and

• (ii) by adding the following new paragraph (B) immediately after paragraph (A) of Bye-law 197:

  • “(B) 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 (d) of paragraph (A) 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 documents was relevant to a claim.”.”

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NOTICE OF ANNUAL GENERAL MEETING

As special business, to consider and, if though fit, to pass the following resolutions, with or without modifications, as ordinary resolutions:

ORDINARY RESOLUTIONS

1. “ THAT :

2. (a) subject to paragraph (c) below and pursuant to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”), the exercise by the Directors during the Relevant Period (as defined below) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which would or might require the exercise of such power be and is hereby generally and unconditionally approved;

3. (b) the approval in paragraph (a) above shall authorise the Directors during the Relevant Period (as defined below) to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which would or might require the exercise of such power after the end of the Relevant Period;

4. (c) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) and issued by the Directors pursuant to the approval in paragraph (a) above, otherwise than pursuant to (i) a Right Issue (as defined below); (ii) an issue of shares as scrip dividends pursuant to the bye-laws of the Company from time to time; or (iii) an issue of shares under any option scheme or similar arrangement for the time being adopted for the grant or issue to employees of the Company and/or any of its subsidiaries of shares or rights of the Company, shall not exceed 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing this Resolution and the said approval shall be limited accordingly; and

5. (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 bye-laws of the Company or any applicable law to be held; or

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NOTICE OF ANNUAL GENERAL MEETING

• (iii) the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting.

“ Right Issue ” means an offer of shares open for a period fixed by the Directors to the holders of shares of the Company on the register on a fixed record date in proportion to their then holdings of such share as at that date (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, any territory outside Hong Kong applicable to the Company).”

1. “ THAT :

2. (a) subject to paragraph (b) below, the exercise by the Directors during the Relevant Period (as defined below) of all the powers of the Company to repurchase shares of the Company on 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 and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws and the requirements of the Rules Governing the Listing of Securities on the Stock Exchange or any other stock exchange as amended from time, be and is hereby generally and unconditionally approved;

3. (b) the aggregate nominal amount of the shares of the Company which the Company is authorised to repurchase 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 passing this Resolution and the said approval shall be limited accordingly; and

for the purposes 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 bye-laws of the Company or any applicable law to be held; or

• (iii) the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting.”

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NOTICE OF ANNUAL GENERAL MEETING

1. “ THAT conditional upon the passing of Resolutions nos. 5 and 6 as set out in this notice of the annual general meeting of the Company dated 31 July 2006, the general mandate granted to the Directors to exercise the powers of the Company to allot, issue or otherwise deal with the Shares pursuant to Resolution no. 5 above be and is hereby extended by the addition, to the aggregate nominal amount of the shares capital of the Company which may be allotted by the Directors pursuant to such general mandate, 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. 6 above, provided that such amount shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue at the date of the passing of this Resolution.”

By Order of the Board Suga International Holdings Limited Ng Chi Ho Chairman

Hong Kong, 31 July 2006

Notes:

• (1) A member entitled to attend and vote at this Meeting is entitled to appoint a proxy or proxies to attend and vote instead of him. A proxy needs not be a member of the Company.

• (2) 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 of attorney or authority must be deposited with the Company’s branch registrar and registration office in Hong Kong, Computershare Hong Kong Investor Services Limited, at 46th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding this Meeting or any adjournment thereof.

• (3) The register of members of the Company will be closed from 21 August 2006 to 25 August 2006 (both days inclusive) during which period no transfer of shares can be registered. All transfers of shares accompanied by the relevant share certificates and transfer forms must be lodged with the Company’s branch registrar and registration office in Hong Kong, Computershare Hong Kong Investor Services Limited, at 46th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong for registration not later than 4:00 p.m. on 18 August 2006.

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