Luye Pharma Group Limited — AGM Information 2008

Jul 31, 2008

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 Takson Holdings Limited , you should at once hand this Circular and the accompanying proxy form to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or 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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TAKSON HOLDINGS LIMITED 第一德勝控股有限公司 * (Incorporated in Bermuda with limited liability)

(Stock Code: 918)

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES PROPOSED INCREASE OF AUTHORISED SHARE CAPITAL PROPOSED REFRESHMENT OF SHARE OPTION SCHEME MANDATE LIMIT RE-ELECTION OF DIRECTORS AND NOTICE OF ANNUAL GENERAL MEETING

A letter from the board of directors of the Company is set out on pages 4 to 10 of this Circular. The notice convening an annual general meeting of the Company (the “Annual General Meeting”) to be held at Salon III, 1/F., Harbour Plaza Hong Kong, 20 Tak Fung Street, Whampoa Garden, Hunghom, Kowloon, Hong Kong on 25 August 2008 at 4:00 p.m. is set out on pages 17 to 21 of this Circular. Shareholders are advised to read the notice and to complete and return the proxy form for use at the Annual General Meeting enclosed herewith in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for the holding of the Annual General Meeting to the office of the Company’s branch share registrar in Hong Kong, Tricor Abacus Limited, at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong. Completion and return of the proxy form will not preclude you from attending and voting at the meeting or any adjournment thereof (as the case may be) should you so wish.

31 July 2008

• For identification purpose only

CONTENTS

		Page
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
Letter	from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
2.	General mandate to issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
3.	General mandate to repurchase Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
4.	Re-election of Retiring Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
5.	Proposed increase of authorised share capital . . . . . . . . . . . . . . . . . . . . . . . . .	6
6.	Refreshment of the 10% limit on the grant of Share
	Options under the Share Option Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
7.	Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
8.	Action to be taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
9.	Procedure to demand a poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
10.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
11.	Responsibility Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Appendix I — Explanatory Statement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		11
1.	Share Repurchase Rules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
2.	Share Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
3.	Reasons for Repurchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
4.	Funding of Repurchases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
5.	Share Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
6.	General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
7.	Takeovers Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
8.	Share Repurchase made by the Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
Appendix II — Details of retiring Directors proposed to be re-elected. . . . . . . . . .		16
Notice	of Annual General Meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	17

— i —

DEFINITIONS

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

“AGM” or “Annual General Meeting”	the annual general meeting of the Company to be
	held at Salon III, 1/F., Harbour Plaza Hong Kong,
	20 Tak Fung Street, Whampoa Garden, Hunghom,
	Kowloon, Hong Kong on Monday, 25 August 2008 at
	4:00 p.m., or any adjournment thereof
“AGM Notice”	the notice dated 31 July 2008 convening the AGM as
	set out on pages 17 to 21 of this Circular
“associates”	has the same meaning as ascribed to it under the
	Listing Rules
“Board”	the board of Directors(s) of the Company
“Bye-laws”	the bye-laws of the Company as may be amended
	from time to time
“Company”	Takson Holdings Limited, a company incorporated in
	Bermuda with limited liability, the Shares of which
	are listed on the Stock Exchange
“Director(s)”	director(s) of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the
	People’s Republic of China
“Latest Practicable Date”	25 July 2008, being the latest practicable date prior to
	the printing of this Circular for ascertaining certain
	information contained herein
“Listing Committee”	the listing sub-committee of the directors of the
	Stock Exchange
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange

— 1 —

DEFINITIONS

• “Ordinary Resolution(s)”

• “Repurchase Mandate”

• “Scheme Mandate Limit”

• “SFO”

• “Share(s)”

• “Share Issue Mandate”

• “Share Options”

• “Share Option Scheme”

the proposed ordinary resolution(s) as referred to in the AGM Notice

a general mandate to the Directors to exercise the powers of the Company to repurchase Shares up to a maximum of 10% of the issued share capital of the Company as at the date of passing of Ordinary Resolution no. 4(B) during the period as set out in Ordinary Resolution no. 4(B)

the maximum number of Shares which may be issued upon the exercise of all the Share Options to be granted under the Share Option Scheme and such other scheme of the Company which shall not in aggregate exceed 10% of the Shares in issue as at the date of the approval of the Share Option Scheme by the Shareholders and thereafter, if refreshed, shall not exceed 10% of the Shares in issue as at the date of approval of the refreshed limit by the Shareholders

• Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong)

• ordinary share(s) of HK$0.10 each in the capital of the Company (or of such other nominal amount as shall result from a sub-division, consolidation, reclassification or reconstruction of the share capital of the Company from time to time)

• a general mandate to the Directors to exercise the powers of the Company to allot, issue and deal with additional Shares during the period as set out in Ordinary Resolution no. 4(A) up to 20% of the issued share capital of the Company as at the date of passing of Ordinary Resolution no. 4(A)

• the share options granted under the Share Option Scheme

• the share option scheme of the Company adopted on 25 August 2006

— 2 —

DEFINITIONS

“Share Repurchase Rules” the relevant rules as set out in the Listing Rules to regulate the repurchase by companies with primary listing on the Stock Exchange of their own securities on the Stock Exchange “Shareholder(s)” the 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$” Hong Kong dollars, the lawful currency of Hong Kong “%” per cent.

— 3 —

LETTER FROM THE BOARD

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TAKSON HOLDINGS LIMITED 第一德勝控股有限公司 * (Incorporated in Bermuda with limited liability)

(Stock Code: 918)

Executive Directors:

Mr. Wong Tek Sun, Takson (Chairman) Ms. Pang Shu Yuk, Adeline Rita

Non-Executive Director:

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

Mr. Wong Tak Yuen

Independent Non-Executive Directors: Mr. Lee Kwok Cheung Mr. Cunningham, James Patrick Mr. Chau Tsun Ming Jimmy

Head Office and Principal Place of Business in Hong Kong: Room 512-513 5th Floor, South Wing Harbour Centre Tower One 1 Hok Cheung Street Hunghom, Kowloon Hong Kong

31 July 2008

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES PROPOSED INCREASE OF AUTHORISED SHARE CAPITAL PROPOSED REFRESHMENT OF SHARE OPTION SCHEME MANDATE LIMIT RE-ELECTION OF DIRECTOR AND NOTICE OF ANNUAL GENERAL MEETING

1. INTRODUCTION

At the AGM, ordinary resolutions will be proposed to (i) grant to the Directors general mandates to allot, issue and deal with new Shares and to repurchase Shares, (ii) re-elect retiring Directors, (iii) increase the authorised capital of the Company and (iv) refresh the Scheme Mandate Limit.

• For identification purpose only

— 4 —

LETTER FROM THE BOARD

The purpose of this Circular is to provide you with information regarding the Share Issue Mandate, the Repurchase Mandate, the re-election of retiring Directors, the proposed increase of authorised share capital of the Company and the proposed refreshment of the Scheme Mandate Limit and to seek your approval of the ordinary resolutions relating to the aforesaid matters at the AGM.

At the annual general meeting of the Company held on 24 August 2007, resolutions of the Shareholders were passed giving general unconditional mandates to the Directors to:

• (i) allot, issue and otherwise deal with Shares up to a maximum of 20% of the aggregate nominal amount of the issued share capital of the Company in issue as at the date of passing such resolution;

• (ii) repurchase Shares up to a maximum of 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of such resolution; and

• (iii) extend the general mandate to issue Shares as mentioned in paragraph (i) above an amount representing the total nominal amount of the issued share capital of the Company repurchased by the Company under the general mandate granted to the Directors to repurchase Shares as mentioned in paragraph (ii) above.

The above general mandates adopted on 24 August 2007 will lapse at the conclusion of the AGM. Therefore, it is proposed to seek your approval to renew the aforesaid general mandates to the Directors.

2. GENERAL MANDATE TO ISSUE SHARES

An ordinary resolution will be proposed at the AGM to grant to the Directors the Share Issue Mandate. In addition, an ordinary resolution will be proposed to authorise an extension of the Share Issue Mandate by adding to the aggregate number of Shares which may be allotted or agreed conditionally or unconditionally to be allotted by the Directors pursuant to the Share Issue Mandate the number of Shares purchased under the Repurchase Mandate, if granted. The Share Issue Mandate shall be exercisable during the period from the passing of Ordinary Resolution nos. 4(A) and 4(C) 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 or the Companies Act 1981 of Bermuda or any other applicable laws of Bermuda to be held; and

— 5 —

LETTER FROM THE BOARD

• (iii) the passing of an ordinary resolution by the Shareholders in general meeting revoking or varying the authority given to the Directors by this resolution.

Details of the Shares Issue Mandate and the extension of the Share Issue Mandate are set out in Ordinary Resolution nos. 4(A) and 4(C) in the AGM Notice.

3. GENERAL MANDATE TO REPURCHASE SHARES

An ordinary resolution will be proposed at the AGM to grant to the Directors the Repurchase Mandate, details of which are set out in Ordinary Resolution no. 4(B) in the AGM Notice. The maximum number of Shares which may be repurchased pursuant to the Repurchase Mandate is 10% of the issued share capital of the Company as at the date of passing of the resolution relating to the Repurchase Mandate.

An explanatory statement required under the Share Repurchase Rules, containing all the relevant information relating to the Repurchase Mandate is set out in Appendix I to this Circular. The information in the explanatory statement provides you with information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolution relating to the Repurchase Mandate.

4. RE-ELECTION OF RETIRING DIRECTORS

At the AGM, Mr. Wong Tak Yuen and Mr. Lee Kwok Cheung will retire as Directors by rotation and, being eligible, offer themselves for re-election as Directors in accordance with Bye-law 87 of the Bye-laws.

Details of the retiring Directors who are proposed to be re-elected at the AGM are set out in Appendix II to this Circular.

5. PROPOSED INCREASE OF AUTHORISED SHARE CAPITAL

In order to provide flexibility for the Company to raise additional capital by way of issue of new Shares in the future, the Directors propose to increase the authorised share capital of the Company from HK$100,000,000 divided into 1,000,000,000 Shares of HK$0.10 each to HK$300,000,000 divided into 3,000,000,000 Shares of HK$0.10 each by the creation of an additional 2,000,000,000 Shares of HK$0.10 each. The Directors confirm that, as at the Latest Practicable Date, they do not have any intention to issue any new Shares.

The proposed increase in authorised share capital of the Company is conditional upon the passing of an ordinary resolution by the Shareholders at the AGM.

— 6 —

LETTER FROM THE BOARD

6. REFRESHMENT OF THE 10% LIMIT ON THE GRANT OF SHARE OPTIONS UNDER THE SHARE OPTION SCHEME

The Share Option Scheme was adopted by the Company on 25 August 2006. The Scheme Mandate Limit was 51,740,000 Shares, representing 10% of the total issued share capital of the Company as at 25 August 2006.

Since the passing of the resolution adopting the Share Option Scheme, Share Options carrying the rights to subscribe for 30,610,000 Shares, representing 5.92% of the total issued share capital of the Company as at 25 August 2006, have been granted. A total of 11,110,000 Share Options granted to the employees of the Company lapsed due to termination of employment. Up to the Latest Practicable Date, no Share Option has been exercised by any holder of the Share Options. The following table summarizes the outstanding share options of the Company as at the Latest Practicable Date:

	Total outstanding	Percentage of issued
	share options granted	share capital as at the
	as at the Latest	Latest Practicable
Holders of Share Options	Practicable Date	Date
Mr. Wong Tek Sun, Takson	5,170,000	0.72%
Ms. Pang Shu Yuk, Adeline Rita	5,170,000	0.72%
Employees	4,160,000	0.58%
Others	5,000,000	0.70%
Total	19,500,000	2.72%

The Share Option Scheme was adopted to provide the Company with a flexible means of giving incentive to, rewarding, remunerating, compensating and/or providing benefits to the relevant participants of the Share Option Scheme and for such other purposes as the Board may approve from time to time.

It was proposed that subject to the approval of the Shareholders at the AGM and such other requirements under the Listing Rules, the Scheme Mandate Limit will be refreshed so that the total number of Shares which may be issued upon exercise of all Share Options to be granted under the Share Option Scheme and all other share option schemes of the Company shall not exceed 10% of the Shares in issue as at the date of approval of the proposed refreshment of the Scheme Mandate Limit by the Shares at the AGM. Share Options previously granted under the Share Option Scheme and/ or any other share option scheme(s) of the Company, including without limitation those outstanding, cancelled, lapsed or exercised in accordance with the Share Option Scheme or such other share option schemes of the Company will not be counted for the purpose of the proposed refreshment of the Scheme Mandate Limit.

— 7 —

LETTER FROM THE BOARD

Pursuant to the Listing Rules, the Shares which may be issued upon the exercise of all outstanding Share Options granted and yet to be exercised under the Share Option Scheme and any other share option scheme(s) of the Company at any time will not exceed 30% of the Shares in issue from time to time. No options will be granted under any share option scheme(s) of the Company if it will result in the 30% limit being exceeded.

An ordinary resolution will be proposed at the AGM to approve the proposed refreshment of the Scheme Mandate Limit.

The adoption of the proposed refreshment of the Scheme Mandate Limit is conditional upon:

• (i) the Shareholders having passed an ordinary resolution to approve the proposed refreshment of the Scheme Mandate Limit at the AGM; and

• (ii) the Stock Exchange having granted the approval for the listing of, and permission to deal in, the Shares to be issued pursuant to the exercise of any Share Options that may be granted pursuant to the Share Option Scheme not exceeding 10% of the number of Shares in issue as at the date of approval of the proposed refreshment of the Scheme Mandate Limit by the Shareholders.

As at the Latest Practicable Date, the issued share capital of the Company comprised 717,400,000 Shares. Assuming that there is no change in the issued share capital of the Company between the period from the Latest Practicable Date and the date of the AGM, the number of Shares which may be issued pursuant to the refreshed Scheme Mandate Limit on the date of adoption of the refreshed Scheme Mandate Limit will be 71,740,000 Shares, representing 10% of the total issued share capital of the Company as at the Latest Practicable Date.

Application will be made to the Stock Exchange for the listing of, and permission to deal in, the Shares which fall to be issued upon the exercise of any Share Options that may be granted pursuant to the Share Option Scheme under the proposed refreshment of the Scheme Mandate Limit.

7. ANNUAL GENERAL MEETING

The AGM will be held at Salon III, 1/F., Harbour Plaza Hong Kong, 20 Tak Fung Street, Whampoa Garden, Hunghom, Kowloon, Hong Kong on Monday, 25 August 2008 at 4:00 p.m.. The AGM Notice is set out on pages 17 to 21 of this Circular.

— 8 —

LETTER FROM THE BOARD

8. ACTION TO BE TAKEN

A proxy form for use at the AGM is enclosed with this Circular. Whether or not you intend to attend the AGM, you are requested to complete the accompanying proxy form in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar in Hong Kong, Abacus Share Registrars Limited, at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong, as soon as possible and in any event not less than 48 hours before the time appointed for holding the AGM or any adjourned meeting thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the AGM or any adjourned meeting thereof should you so wish.

9. PROCEDURE TO DEMAND A POLL

Pursuant to the existing Bye-law 66, 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:

• (i) by the Chairman of the meeting; or

• (ii) 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

• (iii) 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 the Shareholders having the right to vote at the meeting; or

• (iv) 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 in the Company conferring a right to vote at the meeting being shares 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; or

• (v) if required by the Listing Rules, by any Director or Directors who, individually or collectively, hold proxies in respect of shares representing five per cent. (5%) or more of the total voting rights at the meeting.

Unless a poll is duly demanded and the demand is not withdrawn, a declaration by the Chairman that a resolution has been carried, or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the minute book of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour or against the resolution.

— 9 —

LETTER FROM THE BOARD

10. RECOMMENDATION

The Directors believe that the Share Issue Mandate, the Repurchase Mandate, the extension of the Share Issue Mandate, the re-election of the retiring Directors, the proposed increase of the authorised share capital of the Company and the proposed refreshment of the Scheme Mandate Limit are in the best interests of the Company as well as the Shareholders. Accordingly, the Directors recommend that all Shareholders should vote in favour of each of the Ordinary Resolutions as set out in the AGM Notice.

11. RESPONSIBILITY STATEMENT

This Circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this Circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.

Yours faithfully,

By order of the Board Wong Tek Sun, Takson Chairman

— 10 —

EXPLANATORY STATEMENT

APPENDIX I

This appendix serves as an explanatory statement, as required by the Listing Rules to provide requisite information to you for your consideration of the proposal to approve the repurchase of Shares up to a maximum of 10% of the issued share capital of the Company as at the date of grant of the Repurchase Mandate. For the purpose of this appendix, the term “shares” shall have the definition as set out in the Takeovers Code which means shares of all classes and securities which carry a right to subscribe or purchase shares.

1. SHARE REPURCHASE RULES

The Share Repurchase Rules permit companies whose primary listing are on the Stock Exchange to repurchase their fully paid up shares on the Stock Exchange subject to certain restrictions, the most important of which are summarised as follows:

(a) Shareholders’ Approval

The Share Repurchase Rules provide that all on-market repurchases by a company with its primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, either by way of a specific approval on a particular transaction or by a general mandate to the directors of the company to make such repurchase.

(b) Source of Funds

Repurchase must be made out of funds which are legally available for the purpose and in accordance with the laws of Bermuda and the memorandum of association and bye-laws of the Company.

The Company is empowered by its memorandum of association and the Bye-laws to purchase its shares. The laws of Bermuda provide that the amount of capital paid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant shares, or out of funds of the Company otherwise available for dividend or distribution or the proceeds of a fresh issue of shares made for the purpose. The amount of premium payable on repurchase may only be paid out of funds of the Company otherwise available for dividend or distribution or out of the share premium account of the Company.

2. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 717,400,000 Shares.

— 11 —

EXPLANATORY STATEMENT

APPENDIX I

Subject to the passing of the ordinary resolution regarding the Repurchase Mandate and on the basis that no further Shares are issued or repurchased prior to the AGM, the Company will be allowed under the Repurchase Mandate to repurchase a maximum of 71,740,000 Shares, representing 10% of the issued share capital of the Company as at the Latest Practicable Date.

If the exercise of the power to repurchase Shares pursuant to the Repurchase Mandate (if approved) results in the number of Shares which are in the hands of the public falls below the prescribed minimum of 25% as required by the Listing Rules, the Company will not exercise the power to repurchase Shares. The Company has no intention to repurchase Shares to such an extent that the public float of the Company will fall below 25%.

3. REASONS FOR REPURCHASES

The Directors believe that the Repurchase Mandate affords the Company the flexibility and ability which are beneficial to the Company and the Shareholders. Such purchase may, depending on market conditions and funding arrangements at the material time, enhance the net assets and/or earnings per Share of the Company and will only be made when the Directors believe that such a purchase will benefit the Company and the Shareholders.

4. FUNDING OF REPURCHASES

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with its memorandum of association, the Bye-laws and the laws of Bermuda.

On the basis of the consolidated financial position of the Company as at 31 March 2008, being the date on which the latest published accounts of the Company were made up, the Directors consider that in the event that the Repurchase Mandate were carried out in full at any time during the proposed repurchase period, there might be an adverse impact on the working capital position of the Company. However, the Directors do not intend to exercise the Repurchase Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital requirement of the Company or the gearing levels which are in the opinion of the Directors appropriate for the Company from time to time.

— 12 —

EXPLANATORY STATEMENT

APPENDIX I

5. SHARE PRICES

The highest and lowest prices at which the Shares were traded on the Stock Exchange during each of the previous 12 months were as follows:

	Share
	Highest	Lowest
	HK$	HK$
2007
August	1.010	0.330
September	0.670	0.450
October	0.750	0.400
November	0.620	0.415
December	0.470	0.250
2008
January	0.260	0.110
February	0.305	0.150
March	0.232	0.160
April	0.270	0.153
May	0.235	0.153
June	0.195	0.150
July – Latest Practicable Date	0.189	0.149

6. GENERAL

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the powers of the Company to make repurchases pursuant to the Repurchase Mandate and in accordance with the Listing Rules, the memorandum of association, the Bye-laws and the applicable laws and regulations of Bermuda.

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

No connected person (as defined in the Listing Rules) of the Company has notified the Company that he/she/it intends to sell any Shares to the Company, or has undertaken not to do so, if the Repurchase Mandate is approved by Shareholders.

— 13 —

EXPLANATORY STATEMENT

APPENDIX I

7. TAKEOVERS CODE

If as a result of a repurchase of Shares pursuant to the Repurchase Mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of Rule 32 of the Takeovers Code. Accordingly, a Shareholder or a group of Shareholders acting in concert (within the meaning of the Takeovers Code), depending on the level of and increase in the Shareholders’ interest, could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 and Rule 32 of the Takeovers Code.

As at the Latest Practicable Date:

• (a) Takson International Holdings Limited was interested in 285,120,000 Shares, representing 39.7% of the issued share capital of the Company;

• (b) Wangkin Investments Inc. was deemed to be interested in 285,120,000 Shares by virtue of its 100% shareholding interest in Takson International Holdings Limited;

• (c) Mr. Wong Tek Sun Takson was deemed to be interested in an aggregate of 69.77% of the issued share capital of the Company by virtue of (i) 204,621,600 Shares beneficially owned by him, (ii) 10,800,000 Shares beneficially owned by Ms. Pang Shu Yuk, Adeline Rita (the spouse of Mr. Wong Tek Sun Takson) and (ii) 285,120,000 Shares deemed to be interested by him by virtue of his 50% shareholding interest in Wangkin Investments Inc.; and

• (d) Ms. Pang Shu Yuk, Adeline Rita was deemed to be interested in an aggregate of 69.77% of the issued share capital of the Company by virtue of (i) 10,800,000 Shares beneficially owned by her, (ii) 204,621,600 Shares beneficially owned by Mr. Wong Tek Sun, Takson (the spouse of Ms. Pang Shu Yuk, Adeline Rita) and (iii) 285,120,000 Shares deemed to be interested by her by virtue of her 50% shareholding interest in Wangkin Investments Inc..

To the best of knowledge and belief of the Company, as at the Latest Practicable Date, no other person, together with his/her associates, was beneficially interested in Shares representing 5% or more of the issued share capital of the Company.

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EXPLANATORY STATEMENT

APPENDIX I

The Directors are not presently aware of any obligation which may arise under the Takeovers Code as a result of any repurchases made under the Repurchase Mandate. In the event that the Repurchase Mandate is exercised in full and on the basis that no further Shares are issued, the number of Shares held by (i) Wangkin Investments Inc. and Takson International Holdings Limited would be increased to approximately 44.2% of the total number of Shares in issue and (ii) Mr. Wong Tek Sun Takson and Ms. Pang Shu Yuk Adeline Rita would be increased to approximately 77.5% of the total number of Shares in issue. The Directors will take all reasonable steps to ensure compliance with the prescribed minimum percentage requirement of 25% of the issued share capital of the Company to be held in public hands pursuant to the Listing Rules.

8. SHARE REPURCHASE MADE BY THE COMPANY

No repurchase of Shares (whether on the Stock Exchange or otherwise) has been made by the Company in the six months preceding the Latest Practicable Date.

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DETAIL OF RETIRING DIRECTORS TO BE RE-ELECTED

APPENDIX II

The details of the retiring Directors proposed to be re-elected at the AGM are set out as follows:

Mr. Wong Tak Yuen , aged 52, has extensive experience in real estate development and general trading in the PRC market for more than 20 years. He was appointed as non-executive Director in January 2003. He did not hold any other executive positions in any other members of the Group nor any directorships in other listed companies during the last three years.

There is no service agreement between the Company and Mr. Wong. Mr. Wong is not appointed for a specific term but is subject to retirement by rotation and re-election at the AGM in accordance with the Bye-laws. Mr. Wong is entitled to a director’s fee of HK$240,000 per annum. Such director’s fee is determined by the Board with reference to the prevailing market conditions.

As at the Latest Practicable Date, Mr. Wong does not have any interest in the securities of the Company within the meaning of Part XV of the SFO and other than being the brother of Mr. Wong Tek Sun, Takson, Mr. Wong has no relationship with any other directors, senior management or substantial or controlling shareholders of the Company.

Mr. Lee Kwok Cheung , aged 59, was appointed as an independent non-executive director of the Company in September 1997. Mr. Lee is a director of Management Capital Limited, a company engaged in the business of direct investment and financial advisory. Mr. Lee was the Chief Executive of Giordano Holdings Limited during the period between 1991 and 1993 and Polytec Holdings Limited, a company engaged in the business of textile and real estate, during the period between 1994 and 1995. Mr. Lee has also over eleven years of experience in banking. Mr. Lee did not hold any directorship in other listed companies in the last three years.

There is no service agreement between the Company and Mr. Lee. Mr. Lee is not appointed for a specific term but is subject to retirement by rotation and re-election at the AGM in accordance with the Bye-laws. Mr. Lee is entitled to a director’s fee of HK$120,000 per annum. Such director’s fee is determined by the Board with reference to the prevailing market conditions

As at the Latest Practicable Date, Mr. Lee does not have any interest in the securities of the Company within the meaning of Part XV of the SFO and has no relationship with any other directors, senior management or substantial or controlling shareholders of the Company.

Save as disclosed herein, there is no other matter under Rule 13.51(2)(a) – (x) of the Listing Rules which needs to be brought to the attention of the Shareholders in relation to the reelection of the above retiring Directors.

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NOTICE OF ANNUAL GENERAL MEETING

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TAKSON HOLDINGS LIMITED 第一德勝控股有限公司 *

(Incorporated in Bermuda with limited liability)

(Stock Code: 918)

NOTICE IS HEREBY GIVEN that the annual general meeting of Takson Holdings Limited (the “Company”) to be held at Salon III, 1/F., Harbour Plaza Hong Kong, 20 Tak Fung Street, Whampoa Garden, Hunghom, Kowloon, Hong Kong on Monday, 25 August 2008 at 4:00 p.m. for the following purposes:

ORDINARY BUSINESS

1. To receive and consider the audited accounts and the reports of the directors and the auditor for the year ended 31 March 2008.

2. To re-elect directors and to authorise the board of directors to fix their remuneration.

3. To re-appoint the auditor and to authorise the directors to fix their remuneration.

SPECIAL BUSINESS

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

2. (A) “ 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 additional shares in the capital of the Company and to make or grant offers, agreements and options (including warrants, bonds, debentures, notes and other securities which carry rights to subscribe for or are convertible into shares of the Company) which would or might require shares to be allotted be and is hereby generally and unconditionally approved;

   • (b) the approval in paragraph (a) of this resolution shall authorise the directors of the Company during the Relevant Period to make or grant offers, agreements and options (including warrants, bonds, debentures, notes and

3. For identification purpose only

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NOTICE OF ANNUAL GENERAL MEETING

other securities which carry rights to subscribe for or are convertible into shares of the Company) which would or might require shares to be allotted after the end of the Relevant Period;

• (c) the aggregate nominal amount of the share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the directors of the Company pursuant to the approval in paragraph (a) of this resolution, otherwise than pursuant to (i) a rights issue (as hereinafter defined) or (ii) an issue of shares pursuant to the exercise of rights of subscription or conversion under the terms of any existing warrants, bonds, debentures, notes or other securities of the Company or (iii) an issue of shares upon the exercise of subscription rights under any option scheme or similar arrangement of shares or rights to acquire shares of the Company or (iv) an issue of shares pursuant to any scrip dividend or similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares of the Company in accordance with the memorandum of association and the bye-laws of the Company, shall not exceed 20 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of this resolution and the said approval shall be limited accordingly; and

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

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

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or the Companies Act 1981 of Bermuda or any other applicable laws of Bermuda to be held;

• (iii) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the directors of the Company by this resolution; and

“Rights Issue” means an offer of shares in the Company or issue of options, warrants or other securities giving the right to subscribe for shares of the Company, open for a period fixed by the directors of the Company to holders of shares in the Company, or any class of shares of the Company, whose names appear on the register of members of the Company (and, where appropriate, to holders of other securities of the Company entitled to the offer) on a fixed record date in proportion to their then holdings of such shares (or where appropriate such other securities) as at the date (subject to such exclusions or other arrangements as the directors

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NOTICE OF ANNUAL GENERAL MEETING

of the Company 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 recognized regulatory body or any stock exchange in, any territory applicable to the Company).”

• (B) “ THAT :

• (a) subject to paragraph (b) 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 repurchase shares in the share capital of the Company on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the shares of the Company may be listed and is 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 or of any other stock exchange as amended from time to time, be and is hereby generally and unconditionally approved;

• (b) the aggregate nominal amount of shares of the Company which may be repurchased by the Company pursuant to the approval in paragraph (a) above 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 the resolution and the said approval shall be limited accordingly; and

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

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

  • (ii) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or the Companies Act 1981 of Bermuda or any other applicable laws of Bermuda to be held; and

  • (iii) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the directors of the Company by this resolution.”

• (C) “ THAT subject to the passing of the resolutions pursuant to Ordinary Resolution nos. 4(A) and 4(B) of the notice convening this meeting, the general mandate granted to the directors of the Company to exercise the powers of the Company to allot, issue and deal with additional shares in the Company pursuant to

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NOTICE OF ANNUAL GENERAL MEETING

Ordinary Resolution no. 4(A) as set out in the notice convening this meeting 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 Ordinary Resolution no. 4(B) as set out in the notice convening this meeting, provided that such extended amount shall not exceed 10 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date of the passing of the said Ordinary Resolution.”

• (D) “ THAT the authorised share capital of the Company be increased from HK$100,000,000 divided into 1,000,000,000 shares of HK$0.10 each of the Company to HK$300,000,000 divided into 3,000,000,000 shares of HK$0.10 each of the Company by the creation of an additional 2,000,000,000 unissued Shares (“Increase of Authorised Capital”) and the directors of the Company be and are hereby authorised to sign, execute, perfect and deliver all such documents and do all such deeds, acts, matters and things as they may in their absolute discretion consider necessary or desirable for the purpose of or in connection with the implementation of the Increase of Authorised Capital.”

• (E) “ THAT

• (a) subject and conditional upon the Listing Committee of the Stock Exchange granting approval for the listing of, and permission to deal in, the Shares in the share capital of the Company to be issued pursuant to the exercise of options which may be granted under the Scheme Mandate Limit (as defined below), the refreshment of the limit in respect of the maximum number of the Shares which may be issued upon the exercise of all share options to be granted under the share option scheme of the Company adopted on 25 August 2006 (the “Share Option Scheme”) up to 10 per cent of the number of Shares in issue as at the date of the passing of this resolution (the “Scheme Mandate Limit”) be and is hereby approved; and

• (b) any director of the Company be and is hereby authorised to issue and allot from time to time such number of Shares as may be required to be issued pursuant to the exercise of the options under the Share Option Scheme and to do all such acts and execute all such documents to effect the Scheme Mandate Limit.”

By order of the Board Tong Yat Chong Company Secretary

Hong Kong, 31 July 2008

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NOTICE OF ANNUAL GENERAL MEETING

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

Head office and Principal Place of Business in Hong Kong: Room 512-513 5th Floor, South Wing Harbour Centre Tower One 1 Hok Cheung Street Hunghom, Kowloon Hong Kong

Notes:

1. A member of the Company entitled to attend and vote at the above meeting is entitled to appoint one or, if he is the holder of two or more shares, more than one proxy to attend and to vote instead of him. A proxy need not be a member of the Company.

2. In order to be valid, the proxy form together with the power of attorney of other authority (if any) under which it is signed or a certified copy of that power of authority, must be deposited at the Company’s branch share registrar in Hong Kong, Tricor Abacus Limited, at 26/F, Tesbury Centre, 28 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for holding the meeting or any adjourned meeting (as the case may be).

3. Completion and return of the proxy form will not preclude members from attending and voting at the aforesaid meeting.

4. The register of members will be closed from 20 August 2008 (Wednesday) to 25 August 2008 ( Monday) (both dates inclusive), during which period no transfer of shares will be effected. In order to be eligible to attend and vote at the annual general meeting of the Company to be held on 25 August 2008, all transfers of shares accompanied by the relevant share certificates must be lodged with the Hong Kong branch share registrars of the Company, Tricor Abacus Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Hong Kong for registration no later than 4:00 p.m. on 19 August 2008 (Tuesday).

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