Matrix Holdings Limited — Proxy Solicitation & Information Statement 2004

Mar 30, 2004

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold all your shares in Matrix Holdings Limited , you should at once hand this circular to the purchaser or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

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.

MATRIX HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

PROPOSALS INVOLVING

INCREASE IN AUTHORIZED SHARE CAPITAL

GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE SHARES AND AMENDMENTS TO THE COMPANY’S BYE-LAWS

A notice convening the Annual General Meeting of Matrix Holdings Limited (the “Company”) to be held at Garden Room A & B, 2/F., Hotel Nikko Hong Kong, No. 72 Mody Road, Tsimshatsui East, Kowloon, Hong Kong on Tuesday, 20 April 2004, at 2:30 p.m. is set out in the 2003 Annual Report of the Company sent together with this circular.

Whether or not you propose to attend the Annual General Meeting, 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 Registrars in Hong Kong, Secretaries Limited, at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for holding of the meeting or the adjourned meeting (as the case may be). Completion and return of a proxy form will not preclude shareholders from attending and voting at the Annual General Meeting if they so wish.

26 March 2004

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Increase in Authorized Share Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Share Issue Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Share Repurchase Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Extension of Share Issue Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Amendments to the Bye-laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Action to be Taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Appendix
I. Explanatory Statement to Share Repurchase Mandate . . . . . . . . . . . . . . . . . .	9
II. Details of the Amendments to the Bye-laws . . . . . . . . . . . . . . . . . . . . . . . . . .	12

– i –

DEFINITIONS

“Act”	the Companies Act 1981 of Bermuda, as amended from
	time to time
“AGM”	the Annual General Meeting of the Company to be held on
	Tuesday, 20 April 2004 at 2:30 p.m.
“AGM Notice”	the notice convening the AGM, which is set out in the 2003
	Annual Report sent together with this circular
“Board”	the board of Directors
“Bye-laws”	the bye-laws of the Company
“Companies Ordinance”	the Companies Ordinance (Chapter 32) of the Laws of Hong
	Kong, as amended from time to time
“Company”	Matrix Holdings Limited, an exempted company
	incorporated in Bermuda with limited liability, the Shares
	of which are listed on the Stock Exchange
“Directors”	the directors of the Company
“Existing Issue Mandate”	a general mandate granted to the Directors at the annual
	general meeting of the Company held on 15 April 2003 to
	allot, issue and deal with Shares not exceeding 20 per cent.
	of the aggregate number of Shares comprised in the share
	capital of the Company in issue as at 15 April 2003
“Existing Repurchase	a general mandate granted to the Directors at the annual
Mandate”	general meeting of the Company held on 15 April 2003 to
	repurchase Shares not exceeding 10 per cent. of the
	aggregate number of Shares comprised in the share capital
	of the Company in issue as at 15 April 2003
“Group”	the Company and its subsidiaries from time to time
“HK$” and “cents”	Hong Kong dollars and cents, the lawful currency of Hong
	Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the
	People’s Republic of China

– 1 –

DEFINITIONS

• “Latest Practicable Date” 23 March 2004, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular

• “Listing Rules” The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

• “Ordinary Resolutions” the ordinary resolutions to be proposed and passed at the AGM for the matters as set out in the AGM Notice

• “Repurchase Resolution” the proposed ordinary resolution as referred to in resolution no. 5C of the AGM Notice

• “SFO” the Securities and Futures Ordinance (Chapter 571) of the laws of Hong Kong, as amended from time to time

• “Share(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company

• “Share Issue Mandate” a general mandate proposed to be granted to the Directors at the AGM to allot, issue and deal with Shares of up to 20 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the relevant resolution granting such mandate

• “Share Repurchase Mandate”

• a general mandate proposed to be granted to the Directors at the AGM to repurchase Shares not exceeding 10 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the relevant resolution granting such mandate

• “Shareholder(s)” holder(s) of Share(s)

• “Special Resolution”

the Special Resolution to be proposed and passed at the AGM for the matters as set out in the AGM Notice

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Takeover Code” The Hong Kong Code on Takeovers and Mergers

– 2 –

LETTER FROM THE BOARD

MATRIX HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

Directors:

Executive Directors: Cheng Yung Pun (Chairman) Yu Sui Chuen Cheng Wing See, Nathalie

Registered Office:

Canon’s Court 22 Victoria Street Hamilton HM 12 Bermuda

Head Office and

Independent Non-Executive Directors: Heng Kwoo Seng Mak Shiu Chung, Godfrey

Principal Place of Business: Room 1201&1222, 12/F. Peninsula Centre 67 Mody Road Tsimshatsui East Kowloon, Hong Kong

26 March 2004

To the Shareholders

Dear Sir or Madam,

PROPOSALS INVOLVING

INCREASE IN AUTHORIZED SHARE CAPITAL

GENERAL MANDATES TO ISSUE SHARES AND REPURCHASE SHARES AND AMENDMENTS TO THE COMPANY’S BYE-LAWS

INTRODUCTION

The purpose of this circular is to provide you with the information in respect of the Ordinary Resolutions and the Special Resolution to be proposed at the AGM for, amongst other things:

• (i) approving the proposed increase in authorized share capital;

• (ii) granting to the Directors the Share Issue Mandate;

• (iii) granting to the Directors the Share Repurchase Mandate;

• (iv) extending the Share Issue Mandate by adding to it the aggregate number of the issued Shares repurchased under the Share Repurchase Mandate; and

• (v) amending the Bye-laws of the Company.

– 3 –

LETTER FROM THE BOARD

INCREASE IN AUTHORIZED SHARE CAPITAL

In order that a sufficient number of unissued Shares are available for future purpose, the Directors propose an ordinary resolution to increase the authorized share capital of the Company to HK$100,000,000 divided into 1,000,000,000 Shares by the creation of an additional 300,000,000 Shares. As at the Latest Practicable Date, the existing authorized share capital of the Company is HK$70,000,000 divided into 700,000,000 Shares and the fully paid issued share capital of the Company is 584,720,000 Shares. An ordinary resolution to this effect will be proposed at the AGM. The Directors have no present intention of issuing any part of that capital.

SHARE ISSUE MANDATE

An ordinary resolution will be proposed at the AGM for the purpose of renewing the Existing Issue Mandate granted to Directors to allot, issue and otherwise deal with the Shares. The Existing Issue Mandate will expire at the conclusion of the AGM. The Share Issue Mandate is subject to a limit equal to 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of passing the resolution.

SHARE REPURCHASE MANDATE

The Repurchase Resolution will be proposed for the purpose of renewing the Existing Repurchase Mandate granted to the Directors to repurchase Shares. The Existing Repurchase Mandate will expire at the conclusion of the AGM. The Share Repurchase Mandate is subject to a limit of equal to 10 per cent. of the issued share capital of the Company as at the date of passing the resolution. An explanatory statement to the Share Repurchase Mandate is set out in the Appendix I to this circular.

EXTENSION TO THE SHARE ISSUE MANDATE

Subject to the passing at the AGM of the proposed resolution regarding the Share Issue Mandate and the Repurchase Resolution, an ordinary resolution will be proposed at the AGM to approve the addition of the number of Shares that may be repurchased under the Share Repurchase mandate to the 20 per cent. Share Issue Mandate.

Shareholders are referred to the AGM Notice, set out in the 2003 Annual Report of the Company sent together with this circular, for details of the Ordinary Resolutions and Special Resolution. With reference to these resolutions, the Board wishes to state that it has no immediate plans to repurchase any Shares or to issue any new Shares, whether for cash or otherwise, pursuant to the relevant mandates.

– 4 –

LETTER FROM THE BOARD

AMENDMENTS TO THE BYE-LAWS

SFO

With the commencement of the SFO on 1 April 2003 and the repealing of the Securities and Futures (Clearing Houses) Ordinance (Chapter 420 of the Laws of Hong Kong), the Directors recommend the definition of “clearing house” under Bye-law 1 shall be amended such that its reference to the Securities and Futures (Clearing Houses) Ordinance shall be deleted.

Corporate Communications

The Stock Exchange has amended the Listing Rules which came into effect on 15 February 2002 with the aim of reducing the volume of printed documents generated by the listed issuers.

Prior to the amendment of the Listing Rules, the Company was required to send to each shareholder a copy of the annual report and accounts. In order to save the printing costs for the benefit of the shareholders, the Company wishes, to the extent permitted by the Company’s Bye-laws and the legal requirements of Bermuda and with the Shareholders’ prior consent, to:

• (i) permit the Company to send or otherwise make available certain corporate communications to holders of securities using electronic means only with their prior approval;

• (ii) permit the Company to distribute summary financial reports (the “Summary Financial Report”) (as defined in the Listing Rules) in place of a full annual report and accounts (the “Full Report”); and

• (iii) allow the Company to offer its shareholders the opportunity to choose not to receive printed copy of any documents to be issued by the listed issuers for information or action by its shareholders (including the Full Report, the Summary Financial Report, interim report, notice and circular) (the “Corporate Communication”) and rely on versions of such documents to be published on the website of the listed issuers, provided that the Company has ascertained the wishes of Shareholders beforehand.

The current Bye-laws of the Company do not allow the Company to send Corporate Communication to the shareholders using electronic means nor otherwise make available its corporate communication by publishing them on the Company’s computer network, nor also distribute the Summary Financial Report to Shareholders who prefer to receive that document in place of the Full Report.

– 5 –

LETTER FROM THE BOARD

As such, the relevant provisions of the existing Bye-laws of the Company will be proposed to be amended to facilitate the implementation of the above items (i) to (iii).

If the relevant amendment to the Bye-laws is effected, the Company will, in circumstances it deems appropriate and in compliance with all applicable laws and regulations and its own constitutional documents, be able to offer holders of securities the chance to receive Corporate Communication by electronic means and Summary Financial Report in place of full annual report.

Shareholders should note that even if resolution to approve the amendments to the Byelaws was passed at the AGM, they may still elect to receive printed version of the Full Report.

Notwithstanding the passing of the relevant resolution at the AGM, there will be no change in the manner in which the Company issues any Corporate Communication to Shareholders unless and until notice has been sent to Shareholders to ascertain their wishes with respect to the various options available for receiving such Corporate Communication prior to the issue of any such Corporate Communication.

Appendix 3 to the Listing Rules

The Stock Exchange has revised the Appendix 3 to the Listing Rules which will come into effect on 31 March 2004 so that a listed issuer’s bye-laws must contain the following:

• (i) the minimum seven-day period for lodgment by shareholders of the notice to nominate a director shall commence no earlier than the day after the despatch of the notice of the meeting appointed for such election and end no later than seven days before the date of such meeting;

• (ii) directors shall abstain from voting at the board meeting on any matter in which any of his associates has a material interest and are not to be counted towards the quorum of the relevant board meeting; and

• (iii) where any Shareholder is, under the Listing Rules, required 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.

As such, it is proposed that the relevant Bye-laws to be amended to ensure compliance with the amended provision of the Listing Rules to facilitate the implementation of the above items (i) to (iii).

– 6 –

LETTER FROM THE BOARD

Corporate Governance Issues

The Stock Exchange has revised the Listing Rules based on the results of the Consultation Conclusions on Proposed Amendments to the Listing Rules Relating to Corporate Governance Issues issued in January 2003. In anticipation of the coming into effect of the revised Listing Rules on 31 March 2004, the Board considers that changes to the Bye-laws should be made in line with the changes required under the Listing Rules, including, but not limited to, the following:

Any vote of shareholders taken at a general meeting to approve the following transactions or arrangements must be taken on a poll:

• (a) connected transactions;

• (b) transactions that are subject to independent shareholders’ approval pursuant to the Listing Rules;

• (c) granting of options to a substantial shareholder or an independent non-executive director or any of their respective associates; and

• (d) any other transaction in which a shareholder has a material interest and is therefore required to abstain from voting;

To reflect this new requirement, the relevant Bye-law will be proposed to be amended.

As such, it is proposed that the relevant Bye-laws will be amended to ensure compliance with the amended provision of the Listing Rules to facilitate the implementation of the above.

Details relating to the proposed amendments to the Bye-laws of the above and other miscellaneous items are set out in Appendix II of this circular.

AGM

The AGM Notice is set out in the 2003 annual report of the Company sent together with this circular.

The Register of Members of the Company will be closed from Friday, 16 April 2004 to Tuesday, 20 April 2004, both days inclusive, during which period no transfer of shares will be registered. In order to be eligible to attend and vote at the AGM of the Company, all transfers accompanied by the relevant share certificates must be lodged with the Company’s Branch Share Registrars in Hong Kong, Secretaries Limited, at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong, not later than 4:00 p.m. on 15 April 2004.

– 7 –

LETTER FROM THE BOARD

ACTION TO BE TAKEN

A proxy form for use at the AGM is enclosed herewith. Whether or not you intend to attend the AGM, you are requested to complete the proxy form and return it to the abovementioned Branch Share Registrars of the Company in Hong Kong not less than 48 hours before the time appointed for holding of the meeting or the adjourned meeting (as the case may be). Completion and return of a proxy form will not preclude shareholders from attending and voting at the extraordinary general meeting if they so wish.

RECOMMENDATION

The Directors consider that proposals of increase in authorized share capital, the Share Issue Mandate, Share Repurchase Mandate, extension to the Share Issue Mandate and the amendments to the Bye-laws are in the best interests of the Company and its Shareholders. Accordingly, the Directors recommend all the Shareholders should vote in favour of these resolutions as set out in the AGM Notice to be proposed at the AGM.

Suncorp Investments Group Limited, the controlling shareholder of the Company as defined in the Listing Rules, which holds 61.65% shareholding of the Company as at the Latest Practicable Date, has indicated that they intend to vote in favour of these resolutions in respect of their holding of Shares.

By Order of the Board Cheng Yung Pun Chairman

– 8 –

APPENDIX I EXPLANATORY STATEMENT TO SHARE REPURCHASE MANDATE

This appendix serves as an explanatory statement required under Rule 10.06(1)(b) of the Listing Rules to provide you with the information necessary for your consideration of the Share Repurchase Mandate.

1. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 584,720,000 Shares.

Exercise in full of the Repurchase Mandate, on the basis that no further Shares are issued or repurchased between the Latest Practicable Date and the date of the approval of the Share Repurchase Mandate, the Company would be allowed under the Repurchase Resolution to repurchase a maximum of 58,472,000 Shares representing not more than 10% of the issued share capital of the Company as at the Latest Practicable Date.

2. REASONS FOR REPURCHASE

The Directors believe that the Share Repurchase Mandate is in the best interests of the Company and its Shareholders. Such purchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net assets and/or and/or its earnings per Share and will only be made when the Directors believe that such a purchase will benefit the Company and its Shareholders.

3. FUNDING OF REPURCHASES

In repurchasing Shares, the Company may only apply funds entirely from the Company’s available cashflow or working capital facilities which will be funds legally available in accordance with the provisions of the Bye-laws of the Company and the Bermuda laws for the purpose. It is envisaged that the funds required for any repurchase would be derived from those funds of the Company, legally permitted to be utilised in this connection, including capital paid up on the Shares to be repurchased, profits otherwise available for distribution and sums standing to either the share premium account or contributed surplus account of the Company.

On the basis of the consolidated financial position of the Company as at 31 December 2003 (being the date to which the latest published audited financial statements of the Company have been made up) and in particular the working capital position of the Company at that time and the number of Shares now in issue, the Directors consider that there might be a material adverse impact on the working capital position or the gearing position of the Company in the event that purchase of all the Shares the subject of the Share Repurchase Mandate were to be carried out in full during the Share Repurchase Mandate period. No purchase would be made in circumstances that would have a material adverse impact on the working capital position or the gearing position of the Company (as compared with the position disclosed in the latest published audited financial statements).

– 9 –

APPENDIX I EXPLANATORY STATEMENT TO SHARE REPURCHASE MANDATE

4. SHARE PRICES

The highest and lowest market prices at which the Shares have traded on the Stock Exchange in each of the twelve months preceding the Latest Practicable Date are as follows:

		Shares
	Highest		Lowest
	(HK$)		(HK$)
2003
March	1.580		1.410
April	1.500		1.280
May	1.530		1.330
June	1.550		1.490
July	2.050		1.490
August	2.250		1.880
September	1.950		1.710
October	1.950		1.820
November	1.890		1.810
December	1.960		1.830
2004
January	1.910		1.820
February	2.075		1.830

5. UNDERTAKING

The Directors have undertaken to the Stock Exchange, so far as the same may be applicable, to exercise the power of the Company to repurchases pursuant to the Repurchase Resolution and in accordance with the Listing Rules and the applicable laws of Bermuda.

None of the Directors nor, to the best of their knowledge and belief having made all reasonable enquiries, any of their associates, have any present intention, if the Share Repurchase Mandate is approved, to sell any Shares to the Company or its subsidiaries.

No other connected persons (as defined in the Listing Rules) have notified the Company that they have a present intention to sell Shares to the Company, or have undertaken not to do so, if the Share Repurchase Mandate is approved by Shareholders.

– 10 –

APPENDIX I EXPLANATORY STATEMENT TO SHARE REPURCHASE MANDATE

6. TAKEOVER CODE

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

As at the Latest Practicable Date, according to the Register kept by the Company pursuant to Section 336 of the SFO, Suncorp Investments Group Limited controlled approximately 61.65% of the entire issued share capital of the Company. If the Repurchase Mandate is exercised in full, the controlling interests of Suncorp Investments Group Limited in the Company will increase to 68.50%. The Directors have no present intention to exercise the power to repurchase Shares pursuant to the Repurchase Mandate to such an extent as to result in the number of Shares held by the public falling below 25%.

The Directors are not aware of any Shareholders or group of Shareholders acting in concert who will become obliged to make a mandatory offer in accordance with Rule 26 of the Takeover Code as a result of repurchase of Shares.

7. REPURCHASES OF SHARES MADE BY THE COMPANY

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

– 11 –

DETAILS OF THE AMENDMENTS TO THE BYE-LAWS

APPENDIX II

This appendix set out the proposed amendments to the Bye-laws to incorporate the changes that have been or will be required under the Listing Rules and enhance the flexibility of management and corporate governance of the Company.

• (a) adding the following new definitions to Bye-law 1:

“address” shall have the ordinary meaning given to it and shall include any facsimile number, electronic number or address or website used for the purposes of any communication pursuant to these Bye-Laws;

“associates” shall have the meaning ascribed to it in the Listing Rules;

“Corporate Communication” means any information issued or to be issued by the Company to its members for their information or action and shall have the meaning ascribed to it in the Listing Rules;

“electronic” means relating to technology having electrical, digital, magnetic, wireless, optical electromagnetic or similar capabilities and such other meanings as given to it in the Electronic Transactions Act 1999 of Bermuda as may be amended from time to time;

“electronic communication” means any Corporate Communication sent by electronic means;

“full financial statements” means the financial statements that are required under section 87(1) of the Act as may be amended from time to time;

“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of China;

“Listing Rules” means the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited as may be amended from time to time;

“notice” means a notice or document to be given or issued by or on behalf of the Company under these Bye-laws and shall include a notice or document which falls within the definition of Corporate Communication recorded or stored in any digital, electronic, electrical, magnetic or other retrievable form or medium and information in visible form whether having physical substance or not;

“summarized financial statements” shall have the meaning ascribed to it in the section 87A(3) of the Act as may be amended from time to time;

– 12 –

DETAILS OF THE AMENDMENTS TO THE BYE-LAWS

APPENDIX II

• (b) deleting the existing definition of “Clearing House”, “Statutes” and “in writing” or “written” in Bye-law 1 and substituting thereof the following definitions:

“Clearing House” means a recognized clearing house within the meaning of the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) and any amendments thereto or re-enactments thereof for the time being in force 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 the Designated Stock Exchange;

“Statutes” means the Act, the Electronic Transactions Act 1999 of Bermuda, and every other act (as amended from time to time) for the time being in force of the Legislature of Bermuda applying to or affecting the Company, the Memorandum of Association and/or these Bye-laws as may be amended from time to time;

“writing” shall, unless the contrary intention appears, be construed as including printing, lithography, photography and every other mode of representing words or figures in a visible, legible and non-transitory form and including where the representation takes the form of electronic display, provided that both the mode of service of the relevant document or notice and the member’s election comply with all applicable Statutes, rules and regulations;

• (c) By deleting the words “14 days’” before the word “notice” in the first line of Bye-law 46.

• (d) By adding the words “Subject to the rules prescribed by the Designated Stock Exchange from time to time, at” and deleting the word “At” before the words “any general meeting” in the first line of Bye-law 69.

• (e) By adding after Bye-law 74 the following new Bye-law 74A:

• 74A Where any member is, under the rules of the Designated Stock Exchange, required 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 member in contravention of such requirement or restriction shall not be counted.

• (f) By adding the following words after the words “shall be” in the sixth line of Bye-law 86(B):

• “deemed to have been duly authorised without further evidence of the facts and be”

– 13 –

DETAILS OF THE AMENDMENTS TO THE BYE-LAWS

APPENDIX II

• (g) By adding the following words at the end of Bye-law 89:

“The period for lodgment of the notice required under this Bye-law shall commence no earlier than the day after the despatch of the notice of the general meeting appointed for such election and end no later than seven (7) days prior to the date of such general meeting.”

• (h) By deleting the word “special” before the words “resolution remove any Director” at the end of the first line in Bye-law 90 and substituting therefor the word “ordinary”.

• (i) By deleting the existing Bye-law 112 and substituting therefor the following new Byelaw 112:

• 112 (A) Subject to the Act, a Director may hold any other office or place of profit with the Company (except that of Auditors) in conjunction with his office of Director for such period and upon such terms as the Board may determine, and may be paid such extra remuneration therefor (whether by way of salary, commission, participation in profits or otherwise) as the Board may determine, and such extra remuneration shall be in addition to any remuneration provided for, by or pursuant to any other Bye-Law(s).

  • (B) A Director may act by himself or his firm in a professional capacity for the Company (otherwise than as Auditors) and he or his firm shall be entitled to remuneration for professional services as if he were not a Director.

  • (C) A Director may be or become a director or other officer of, or otherwise interested in, any company promoted by the Company or any other company in which the Company may be interested, and shall not be liable to account to the Company or the shareholders for any remuneration, profit or other benefit received by him as a director or officer of or from his interest in such other company. The Board may also cause the voting power conferred by the shares in any other company held or owned by the Company to be exercised in such manner in all respects as it thinks fit, including the exercise thereof in favour of any resolution appointing the Directors or any of them to be directors or officers of such other company, or voting or providing for the payment of remuneration to the directors or officers of such other company.

  • (D) A Director shall not vote or be counted in the quorum on any resolution of the Board concerning his own appointment as the holder of any office or place of profit with the Company or any other company in which the Company is interested (including the arrangement or variation of the terms thereof, or the termination thereof).

– 14 –

DETAILS OF THE AMENDMENTS TO THE BYE-LAWS

APPENDIX II

• (E) Where arrangements are under consideration concerning the appointment (including the arrangement or variation of the terms thereof, or the termination thereof) of two or more Directors to offices or places of profit with the Company or any other company in which the Company is interested, a separate resolution may be put in relation to each Director and in such case each of the Directors concerned shall be entitled to vote (and be counted in the quorum) in respect of each resolution except that concerning his own appointment (or the arrangement or variation of the terms thereof, or the termination thereof) and except (in the case of an office or place of profit with any such other company as aforesaid) where the other company is a company in which the Director together with any of his associates owns 5 per cent. or more of the issued shares of any class of the equity share capital of such company or of the voting rights of any class of shares of such company;

• (F) Subject to the Act and to the next paragraph of this Bye-Law, no Director or proposed or intended Director shall be disqualified by his office from contracting with the Company, either with regard to his tenure of any office or place of profit or as vendor, purchaser or in any other manner whatever, nor shall any such contract or any other contract or arrangement in which any Director is in any way interested be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company or the shareholders for any remuneration, profit or other benefits realised by any such contract or arrangement, by reason only of such Director holding that office or the fiduciary relationship thereby established.

• (G) A Director who to his knowledge is in any way, whether directly or indirectly, interested in a contract or arrangement or proposed contract or arrangement with the Company shall declare the nature of his interest at the meeting of the Board at which the question of entering into the contract or arrangement is first taken into consideration, if he knows his interest then exists, or in any other case at the first meeting of the Board after he knows that he is or has become so interested. For the purposes of this ByeLaw, a general notice to the Board by a Director to the effect that (a) he is a shareholder of a specified company or firm and is to be regarded as interested in any contract or arrangement which may after the date of the notice be made with that company or firm or (b) he is to be regarded as interested in any contract or arrangement which may after the date of the notice be made with a specified person who is connected with him, shall be deemed to be a sufficient declaration of interest under this Bye-Law in relation to any such contract or arrangement; provided that no such notice shall be effective unless either it is given at a meeting of the Board or the Director takes reasonable steps to secure that it is brought up and read at the next Board meeting after it is given.

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• (H) A Director shall not vote (nor shall he be counted in the quorum for such resolution) on any resolution of the Board in respect of any contract or arrangement or proposal in which he or any of his associate(s) has/have a material interest, and if he shall do so his vote shall not be counted (nor shall he be counted in the quorum for such resolution), but this prohibition shall not apply to any of the following matters:

• (i) the giving of any guarantee, security or indemnity either:

  • (a) to the Director or his associate(s) in respect of money lent or obligations incurred or undertaken by him or any of them at the request of or for the benefit of the Company or any of its subsidiaries; or

  • (b) to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director or his associate(s) has himself/themselves assumed responsibility in whole or in part and whether alone or jointly under a guarantee or indemnity or by the giving of security;

• (ii) any proposal concerning an offer of shares or debentures or other securities of or by the Company or any other company which the Company may promote or be interested in for subscription or purchase where the Director or his associate(s) is/are or is/are to be interested as a participant in the underwriting or sub-underwriting of the offer;

• (iii) any proposal concerning any other company in which the Director or his associate(s) is/are interested only, whether directly or indirectly, as an officer or executive or shareholder or in which the Director or his associate(s) is/are beneficially interested in shares of that company, provided that the Director and any of his associates are not in aggregate beneficially interested in 5% or more of the issued shares of any class of such company (or of any third company through which his interest or that of his associate(s) is derived) or of the voting rights;

• (iv) any proposal or arrangement concerning the benefit of employees of the Company or its subsidiaries including:

  • (a) the adoption, modification or operation of any employees’ share scheme or any share incentive or share option scheme under which the Director or his associate(s) may benefit; or

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• (b) the adoption, modification or operation of a pension fund or retirement, death or disability benefits scheme which relates both to Directors, his associates and employees of the Company or any of its subsidiaries and does not provide in respect of any Director or his associate(s), as such any privilege or advantage not generally accorded to the class of persons to which such scheme or fund relates; and

• (v) any contract or arrangement in which the Director or his associate(s) is/are interested in the same manner as other holders of shares or debentures or other securities of the Company by virtue only of his/ their interest in shares or debentures or other securities of the Company.

• (vi) any contract for the benefit of employees of the Company or of any of its subsidiaries under which the Director or any of his associates benefits in a similar manner to the employees and which does not accord to any Director or any of his associates as such any privilege or advantage not accorded to the employees to whom the contract relates; and

• (vii) any contract for the purchase or maintenance for any Director or Directors of issurance against any liability.

For the purpose of this Bye-law 112 (H), “subsidiary” shall have the meaning as defined in the Listing Rules.

• (I) A company shall be deemed to be a company in which a Director together with any of his associates owns five (5) per cent. or more of the issued shares of any class of the equity share capital of such company or of the voting rights of any class of shares of such company if and so long as (but only if and so long as) he together with his associates is (either directly or indirectly) the holder of or beneficially interested in five (5) per cent. or more of any class of the equity share capital of such company (or of any third company through which the interest of the Director or that of his associates is derived) or of the voting rights of any class of shares available to shareholders of the company. For the purpose of this paragraph there shall be disregarded any shares held by a Director as bare or any of his associates or custodian trustee and in which he and his associates have no beneficial interest, any shares comprised in a trust in which the interest of the Director or that of his associates is in reversion or remainder if and so long as some other person is entitled to receive the income thereof, and any shares comprised in an authorised unit trust scheme in which the Director or any of his associates is interested only as a unit holder.

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• (J) Where a company in which a Director together with any of his associates holds five (5) per cent. or more of any class of the equity share capital of such company or of the voting rights of any class of shares available to shareholders of the company is materially interested in a transaction, then that Director shall also be deemed materially interested in such transaction.

• (K) If any question shall arise at any meeting of the Board as to the materiality of the interest of a Director (other than the Chairman) and any of his associates or as to the entitlement of any Director (other than such Chairman) to vote or be counted in the quorum and such question is not resolved by his voluntarily agreeing to abstain from voting or not to be counted in the quorum, such question shall be referred to the Chairman and his ruling in relation to such other Director shall be final and conclusive except in a case where the nature or extent of the interest of the Director and any of his associates concerned as known to such Director has not been fairly disclosed to the Board. If any question as aforesaid shall arise in respect of the Chairman and any of his associates such question shall be decided by a resolution of the Board (for which purpose such Chairman shall not be counted in the quorum and shall not vote thereon) and such resolution shall be final and conclusive except in a case where the nature or extent of the interest of such Chairman and any of his associates as known to him has not been fairly disclosed to the Board.

• (j) By changing the numbering of Bye-law 158 to Bye-law 158A and adding at the beginning of Bye-law 158A, the following words “Subject to paragraph B below,” and adding the words “or income and expenditure account” following the words “and profit and loss account”.

• (k) By adding the following new Bye-laws 158B, 158C and 158D immediately after Bye-law 158A:

• 158B The Company may send either (1) summarized financial statements to members of the Company who has, in accordance with the Statutes and any applicable rules and regulations prescribed by the Designated Stock Exchange, consented and elected to receive summarized financial statements instead of the full financial statements or (2) the full financial statements. The summarized financial statements must be accompanied by an auditor’s report and notice informing the member how to notify the Company that he elects to receive the full financial statements. The summarized financial statements, notice and auditor’s report must be sent not less than twentyone (21) days before the date of general meeting to those members that consented and elected to receive the summarized financial statements.

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• 158C Subject to Section 88 of the Act, the Company shall send the full financial statements to a member within seven days of receipt of the member’s election to receive the full financial statements.

• 158D The requirement to send to a person referred to in Bye-law 158A the full financial statements or the summarized financial statements in accordance with Bye-law 158B shall be deemed satisfied where, in accordance with all applicable Statutes, rules and regulations (including, without limitation, the rules of the Designated Stock Exchange), the Company publishes copies of the full financial statements or the summarized financial statements complying with Bye-laws 158A & 158B, as the case may be, on the Company’s computer network or in any other permitted manner (including by sending any form of electronic communication), and that person has agreed or is deemed to have agreed to treat the publication or receipt of such documents in such manner as discharging the Company’s obligation to send to him a printed copy of the full financial statements or the summarized financial statements complying with Bye-laws 158A and 158B and all applicable statutes, rules and regulations, as the case may be.

• (l) By deleting the existing Bye-Law 163 and substituting therefor the following new Bye-Laws 163A and 163B:

• 163A(1) Except where otherwise expressly stated, any notice to be given to or by any members pursuant to these Bye-laws shall be in writing or, to the extent permitted by the Statutes and any applicable rules and regulations prescribed by the Designated Stock Exchange from time to time and subject to this Bye-law, contained in an electronic communication.

• 163A(2) Any notice or document (including any Corporate Communication or a share certificate) may be served on or delivered to any member of the Company either (1) personally or (2) by sending it through the post in a prepaid envelope or wrapper addressed to such member at his registered address as appearing in the register or by leaving it at that address addressed to the member or (3) as the case may be, by transmitting it to any such address or transmitting it to any telex or facsimile transmission number or electronic number or address or website supplied by him to the Company for giving of notice or document to him or which the person transmitting the notice or document reasonably and bona fide believes at the relevant time will result in such notice or document being duly received by the member (4) or by publishing it by way of advertisement in appointed newspapers (as defined in the Act) or the newspapers in accordance with the requirements of the Designated Stock Exchange or (5) by

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any other means authorised in writing by the member concerned. In case of joint holders of a share, all notices shall be given to that one of the joint holders whose name stands first in the register and notice so given shall be sufficient notice to all the joint holders. Without limiting the generality of the foregoing but subject to the Statutes and any rules and regulations prescribed by the Designated Stock Exchange from time to time, a notice or document may be served or delivered by the Company to any member by electronic means to such address as may from time to time be authorised by the member concerned or by publishing it on a computer network and notifying the member concerned (a “notice of availability”), in such manner as he may from time to time authorise, that it has been so published.

• 163A(3) Any such notice or document (including any Corporate Communication or a share certificate) may be served or delivered by the Company by reference to the register as it stands at any time not more than fifteen days before the date of service or delivery. No change in the register after that time shall invalidate that service or delivery. Where any notice or document is served or delivered to any person in respect of a share in accordance with these Bye-laws, no person deriving any title or interest in that share shall be entitled to any further service or delivery of that notice or document. The notice of availability may be given to the member by any of the means set out above.

• 163B(1) Any notice or document (including any Corporate Communication or a share certificate) required to be sent to or served upon the Company, or upon any officer of the Company, may be sent or served by leaving the same or sending it through the post in a prepaid envelope or wrapper addressed to the Company or to such officer at the Company’s office or principal place of business as specified from time to time;

• 163B(2) The Directors may from time to time specify the form and manner in which a notice may be given to the Company by electronic means, including one or more addresses for the receipt of an electronic communication, and may prescribe such procedures as they think fit for verifying the authenticity or integrity of any such electronic communication. Any notice may be given to the Company by electronic means only if it is given in accordance with the requirements specified by the Directors.

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• (m) By deleting the existing Bye-law 164 and substituting thereof the following new Byelaw 164:

• 164 Any notice or other document (including any Corporate Communication or a share certificate), if sent by mail, postage prepaid, shall be deemed to have been served or delivered on the day following that on which the letter, envelope, or wrapper containing the same is put into the post. In proving such service it shall be sufficient to prove that the letter, envelope or wrapper containing the notice or document was properly addressed and put into the post as prepaid mail. Any notice or document not sent by post but left by the Company at a registered address shall be deemed to have been served or delivered on the day it was so left. Any notice or document, if sent by electronic means (including through any relevant system), shall be deemed to be have been given on the day following that on which the electronic communication was sent by or on behalf of the Company. Any notice or document served or delivered by the Company by any other means authorised in writing by the member concerned shall be deemed to have been served when the Company has carried out the action it has been authorised to take for that purpose. Any notice or other document published by way of advertisement shall be deemed to have been served or delivered on the day it was so published. Any notice or other document published on a computer network shall be deemed to have been served or delivered to a member on a day following that on which a notice of availability is deemed to have been given to the member.”

• (n) By adding in Bye-law 170 the words “by means of facsimile or where relevant, by electronic signature” after the word “printed”.”

• Note: The translation into Chinese language of the Circular which contains the details of the amendments to the Bye-laws is for reference only. In case of any inconsistency, the English version shall prevail.

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