Leeport (Holdings) Limited — Proxy Solicitation & Information Statement 2004

Jul 30, 2004

NATIONAL ELECTRONICS HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 213)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the annual general meeting of National Electronics Holdings Limited (the “Company”) will be held on Friday, 27th August 2004 at 10:00 a.m. at Pheasant Room, 1/F., Mandarin Oriental, Hong Kong, 5 Connaught Road, Central, Hong Kong, Hong Kong for the following purposes:

1. To approve the payment of final dividend recommended by the board of directors for the year ended 31st March 2004;

2. To re-elect retiring directors;

3. To determine the director's remuneration for their services in the sum of HK$750,000;

4. To appoint auditors and to authorize the board of directors to fix their remuneration;

As special business to consider and, if thought fit, pass with or without modification the following resolutions which will be proposed as ordinary resolutions of the Company:

ORDINARY RESOLUTIONS

1. “THAT

(a) subject to paragraph (c) below, the exercise by the directors of the Company (the “Directors”) during the Relevant Period (as hereinafter defined) of all the powers of the Company to repurchase issued shares in the capital of the Company on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) 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 and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws and/or the requirements of the Rules Governing the Listing of Securities on the Stock Exchange, be and is hereby generally and unconditionally approved;

(b) the approval in paragraph (a) above shall be in addition to any other authorization given to the Directors and shall authorize the Directors on behalf of the Company during the Relevant Period to repurchase its shares at a price determined by the Directors;

(c) the aggregate nominal amount of share capital of the Company repurchased or agreed conditionally or unconditionally to be repurchased by the Company pursuant to the approval in paragraph (a) above during the Relevant Period shall not exceed 10 per cent of the aggregate nominal amount of the share capital of the Company in issue at the date of passing of this resolution; and

(d) for the purpose of this resolution,

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

(i) the conclusion of the next annual general meeting of the Company;

(ii) the revocation or variation of the authority given under this resolution by an ordinary resolution of the shareholders of the Company in general meeting; and

(iii) the expiration of the period within which the next annual general meeting of the Company is required by any applicable laws or the Company's bye-laws to be held.”;

1. “THAT

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

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

(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 pursuant to the approval in paragraphs (a) and (b) above, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); or (ii) the exercise of rights of subscription or conversion under the terms of any warrants or other securities which may be issued by the Company carrying a right to subscribe for or purchase shares of the Company; or (iii) the exercise of any option granted under any share option scheme adopted by the Company; or (iv) an issue of shares in lieu of the whole or part of a dividend on shares pursuant to any scrip dividend or other similar scheme implemented in accordance with the bye-laws of the Company, shall not exceed 20 per cent of the aggregate nominal amount of the share capital of the Company in issue at the date of passing of this resolution; and

(d) for the purpose of this resolution,

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

(i) the conclusion of the next annual general meeting of the Company;

(ii) the revocation or variation of the authority given under this resolution by an ordinary resolution of the shareholders of the Company in general meeting; and

(iii) the expiration of the period within which the next annual general meeting of the Company is required by any applicable laws or the Company's bye-laws to be held.

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

1. “THAT conditional upon the passing of the ordinary resolutions numbered no. 5 and 6 in the notice convening the annual general meeting of the Company, the aggregate nominal amount of the share capital of the Company which are repurchased by the Company pursuant to and in accordance with the said ordinary resolution no. 5 shall be added to the aggregate nominal amount of the share capital of the Company that may be allotted and agreed conditionally or unconditionally to be allotted by the directors of the Company pursuant to and in accordance with ordinary resolution no. 6 as set out in the notice of the annual general meeting of the Company.”.

As special business to consider and, if thought fit, pass with or without modification the following resolution which will be proposed as a special resolution of the Company:

SPECIAL RESOLUTION

1. “THAT the new bye-laws of the Company marked “A” produced to this meeting and signed by the Chairman, for identification purpose only, be and are hereby approved and adopted as the new bye-laws of the Company, in substitution for and to the exclusion of the existing bye-laws of the Company and that the directors of the Company be and are hereby authorised to do all things and acts and sign all documents which they consider necessary, desirable or expedient in connection with the foregoing.”

By Order of the Board

Tommy Tam Hok Lam

Company Secretary

Hong Kong, 30th July 2004

Executive Directors:

Jimmy Lee Yuen Ching

James Lee Yuen Kui

Peter Lee Yuen Wong

Edward Lee Yuen Cheor

Tommy Tam Hok Lam

Independent non-Executive Directors:

Dr. Alex Wu Shu Chih, C.B.E., L.L.D., J.P.

Dr. Samson Sun, M.B.E., J.P.

Notes:

(1) Any member of the Company entitled to attend and vote at a meeting of the Company shall be entitled to appoint another person as his proxy to attend and vote instead of him. On a poll votes may be given either personally or by proxy. A member may appoint more than one proxy to attend on the same occasion. A proxy need not be a member of the Company.

(2) The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorized in writing, or if the appointor is a corporation, either under seal or under the hand of an officer or attorney duly authorized.

(3) The instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of that power or authority shall be deposited at Company's principal place of business at Room 102-4, St. George's Building, 2 Ice House Street, Central, Hong Kong not less than forty-eight hours before the time for holding the meeting or adjourned meeting or poll (as the case may be) at which the person named in such instrument proposes to vote, and in default the instrument of proxy shall not be treated as valid. Delivery of an instrument appointing a proxy shall not preclude a member from attending and voting in person at the meeting or poll concerned and, in such event, the instrument appointing a proxy shall be deemed to be revoked.

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

(5) Any corporation which is a member of the Company may, by resolutions of its directors or other governing body or by power of attorney, authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of members of the Company, and the person so authorised shall be entitled to exercise the same powers on behalf of the corporation which he represents as that corporation could exercise if it were an individual member of the Company.

(6) Below is a brief summary of the provisions of the new bye-laws of the Company proposed to be adopted by the Company pursuant to resolution no.8 above:-

(a) New definition of “Associate” and “Clearing House”

“Associate” shall have the meaning attributed to it in the Listing Rules from time to time.

“Clearing House” shall mean a recognised clearing house within the meaning of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) or a clearing house or authorised shares depository recognised by the laws of the jurisdiction in which the shares of the Company are listed or quoted on a stock exchange in such jurisdiction.

(b) New provisions in relation to votes of Shareholders

New Bye-Law 76A provides that where the Listing Rules requires any shareholder to abstain from voting on any particular resolution or restricted to voting only for or only against any particular resolution, any votes cast by or on behalf of such shareholder in contravention of such requirement or restriction shall not be counted.

(c) New Provisions in relation to the removal of directors by ordinary resolution

The existing Bye-law 118 provides that a director may be removed by a special resolution.

New Bye-Law 104 provides that a director may be removed by an ordinary resolution.

(d) New Provisions in relation to votes of Directors

Pursuant to the existing Bye-law 103(A)(ii), a director is not precluded from voting or from being counted in the quorum at board meetings in relation to any contract or arrangement in which his associates (as defined in the Listing Rules) have a material interest.

New Bye-Law 98 replaces the existing Bye-law 103 in relation to Directors' voting on Board meetings where they have a material interest.

(i) New Bye-Law 98(H) provides that subject to the exceptions under New Bye-Law 98H(i) to (v), a Director shall not vote on any board resolution nor shall he be counted in the quorum at board meeting in relation to any contract or arrangement or any other proposal in which he or any of his Associate(s) (as defined in the Listing Rules) has a material interest.

(ii) New Bye-Law 98(I) provides that if and so long as a Director (other than in the capacity of a bare or custodian trustee) together his Associate(s) is the holder of or beneficially interested in 5% or more of any class of the shares in a company, such company will be deemed to be a company in which such Director together with any of his Associate(s) own 5% or more of any class of the issued shares or of the voting rights of any class of shares of such company.

(iii) New Bye-Law 98(J) provides that if a company mentioned in New Bye-Law 98(I) is materially interested in a transaction, that Director shall also be deemed materially interested in such transaction.

(e) New provisions in relation to notice to be given when person proposed for election

The existing Bye-law 116 provides that notice in writing of the intention to propose a person for election as a director and notice in writing by that person of his willingness to be elected shall have been given to the Company at least seven days before the date of the general meeting.

Pursuant to New Bye-Law 103, the notice period to be lodged with the Company to nominate a candidate to be elected as a Director at the general meeting will commence on (and include) the day after the dispatch of the notice of the general meeting appointed for such election and end on (and exclude) the date that is seven (7) days before the date appointed for such general meeting.

(f) New provisions in relation to electronic means

The existing Bye-Laws do not provide for service of notices by electronic means.

New Bye-Law 167(A) provides that subject to exceptions, any notice to be given or by any person pursuant to the bye-laws of the Company shall be in writing or, contained in an electronic communication. A notice or document may be served or delivered by the Company to any shareholder by electronic means to such address as may from time to time be authorised by the Shareholder concerned or by publishing it on a computer network and notifying the Shareholder concerned, in such manner as he may from time to time authorise, that it has been so published.

New Bye-Law 167(B) provides that the Board may from time to time specify the form and manner in which a notice may be given to the Company by electronic means. Any notice may be given to the Company by electronic means only if it is given in accordance with the requirements specified by the Board.

New Bye-Law 169 provides that any notice or document, if sent by electronic means (including through any relevant system), shall be deemed to have been given on the day following that on which the electronic communication was sent by or on behalf of the Company.

Please also refer to the published version of this announcement in China Daily.