Novautek Technologies Group Limited — Proxy Solicitation & Information Statement 2007

May 2, 2007

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 licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Applied Development Holdings Limited, you should at once hand this circular with the enclosed form of proxy to the purchaser or transferee or the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or the 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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(incorporated in Bermuda with limited liability)

(Stock Code: 519)

DISCLOSEABLE TRANSACTION

DISPOSAL OF PROPERTY

* For identification purposes only

2 May 2007

CONTENTS

	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
The Provisional Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
The Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Consideration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Reasons for and Benefits of the Disposal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Effect of the Disposal on the Earnings, Assets and Liabilities of the Company .	6
Information of the Group and the Purchaser . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Additional Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
APPENDIX – GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . .	7

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DEFINITIONS

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

“Board”	the board of Directors;
“Company”	Applied Development Holdings Limited, a company
	incorporated in Bermuda and the shares of which are
	listed on the Main Board of the Stock Exchange;
“Directors”	the directors of the Company;
“Disposal”	the disposal of the Property by the Vendor;
“Formal Agreement”	the formal agreement for sale and purchase to be entered
	into between Vendor and Purchaser in respect of the
	Disposal;
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong;
“Independent Third Party(ies)”	independent third party(ies) who, to the best of the
	knowledge, information and belief of the Board, having
	made all reasonable enquiries, are independent third
	parties who are independent of and not connected with
	the directors, chief executive or substantial shareholders
	of the Company, its subsidiaries or any of their respective
	associates;
“Latest Practical Date”	27 April 2007 being the latest practicable date prior to the
	printing of this circular for ascertaining certain
	information contain in this circular;
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange;
“Property”	Unit no. 4203-4 on 42nd Floor, Far East Finance Centre,
	16 Harcourt Road, Admiralty, Hong Kong;
“Provisional Agreement”	the provisional agreement for sale and purchase dated 11
	April 2007 entered into between Vendor and Purchaser in
	respect of the Disposal;
“Purchaser”	Star Plan Ltd.;

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DEFINITIONS

“SFO”	the Securities and Futures Ordinance (Cap.571 of the
	laws of Hong Kong);
“Share(s)”	ordinary share(s) of HK$0.01 each in the share capital of
	the Company;
“Shareholders”	the shareholders of the Company;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited; and
“Vendor”	Applied Investment (Asia) Limited, a wholly-owned
	subsidiary of the Company.

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LETTER FROM THE BOARD

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(incorporated in Bermuda with limited liability)

(Stock Code: 519)

Executive Directors: Registered Office: Mr. Hung Kin Sang, Raymond Canon’s Court Ms. Hung Wong Kar Gee, Mimi 22 Victoria Street Mr. Fang Chin Ping Hamilton HM 12 Mr. Hung Kai Mau, Marcus Bermuda

Independent Non-executive Directors: Head Office and Principal Place of Business: Mr. Soo Hung Leung, Lincoln J.P. Units 3402-3, 34/F Mr. Lo Yun Tai China Merchants Tower Mr. Lun Tsan Kau Shun Tak Centre Mr. Lam Ka Wai, Graham 168-200 Connaught Road Central Hong Kong 2 May 2007

To the Shareholders

Dear Sir/Madam,

DISCLOSEABLE TRANSACTION – DISPOSAL OF PROPERTY

INTRODUCTION

On 11 April 2007, the Vendor, a wholly-owned subsidiary of the Company, entered into a binding Provisional Agreement with the Purchaser for the Disposal for a consideration of HK$59,000,000. The transaction contemplated under the Provisional Agreement constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules.

* For identification purposes only

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LETTER FROM THE BOARD

THE PROVISIONAL AGREEMENT

Date: 11 April 2007

Parties:

Vendor: Applied Investment (Asia) Limited, a wholly-owned subsidiary of the Company.

Purchaser: Star Plan Ltd., which is, and whose ultimate beneficial owners are, Independent Third Parties and is engaged in property investment holding.

THE PROPERTY

The Property is an office unit that has been subdivided into four subunits situated at Unit no. 4203-4 on 42nd Floor, Far East Finance Centre, 16 Harcourt Road, Admiralty, Hong Kong. The gross floor area of the Property is approximately 5,343 square feet.

The Purchaser agreed to acquire the Property subject to the following:–

• (i) a tenancy agreement to expire on 6 August 2008 under which a monthly rent of HK$52,934 is receivable and a rental deposit of HK$175,518 has been paid;

• (ii) a tenancy agreement to expire on 27 September 2007 under which a monthly rent of HK$83,300 is receivable and a rental deposit of HK$273,420 has been paid; and

• (iii) a tenancy agreement to expire on 28 February 2009 under which a monthly rent of HK$75,620 is receivable and a rental deposit of HK$255,472 has been paid.

The fourth subunit will be transferred to the Purchaser with vacant possession. The Vendor and Purchaser agreed that the total rental deposits of HK$704,410 paid by the tenants will be transferred from the Vendor to the Purchaser on completion by way of deduction from the purchase price for the Disposal.

The revenue and net profit before taxation generated by the Property for the years ended 30 June 2005 and 30 June 2006 were as follows:–

	30 June 2005	30 June 2006
Revenue	HK$ 1,107,000	HK$1,288,000
Net profit before taxation
(derived by deducting expenses from revenue and
then adding fair value appreciation)	HK$20,827,000	HK$1,600,000

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LETTER FROM THE BOARD

CONSIDERATION

The total consideration for the Property is HK$59,000,000 and was agreed after arm’s length negotiations between the Vendor and Purchaser by reference to the market value of comparable office properties in Hong Kong, based on reports issued by property agents on properties in the same building and in the same vicinity.

The consideration is receivable as follows:–

• (i) an initial deposit of HK$1,500,000 was paid to the Vendor on signing the Provisional Agreement;

• (ii) a further deposit of HK$4,400,000 is to be paid to the Vendor on signing the Formal Agreement on or before 4 May 2007;

• (iii) a part payment of the purchase price of HK$2,950,000 is to be paid on or before 4 May 2007; and

• (iv) the balance of the purchase price of HK$50,150,000 is to be paid on completion, which is scheduled to take place on or before 7 December 2007.

REASONS FOR AND BENEFITS OF THE DISPOSAL

In light of the rising value of office premises in the Hong Kong property market, the Directors consider it is an appropriate time for the Group to realise this investment.

The Provisional Agreement was entered into in the ordinary and usual course of the business of the Group. The Directors are of the view that the terms of the Disposal including the consideration are fair and reasonable and on normal commercial terms, and the Disposal is in the best interests of, the Company and the Shareholders as a whole.

The Group shall report a net profit before and after taxation attributable to the Property of approximately HK$20,827,000 and HK$1,600,000 for the two financial years ended 30 June 2006 respectively. The Property was originally acquired by the Group at a cost of approximately HK$33,208,000 on 27 October 1998. Based on the consideration under the Provisional Agreement of HK$59,000,000 less the carrying value of the Property of approximately HK$60,000,000 as at 31 December 2006 (representing the original acquisition price of HK$33,208,000 plus a fair value increment of approximately HK$26,792,000 recognised by the Company for the previous period), and certain selling and legal expenses estimated to be approximately HK$300,000, the Company expects that there may be a slight loss of approximately HK$1,300,000 to be accounted for by the Company. The Company expects that the net proceeds of the Disposal will be approximately HK$58,700,000 and it is intended that the proceeds of the Disposal will be applied towards new investments when appropriate and attractive opportunities arise, however the Company has not yet earmarked any such investment opportunities.

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LETTER FROM THE BOARD

EFFECT OF THE DISPOSAL ON THE EARNINGS, ASSETS AND LIABILITIES OF THE COMPANY

The Company expects that there may be a slight loss of approximately HK$1,300,000 to be accounted for by the Company in respect of the Disposal. Although the Disposal will result in a disposal of an asset (i.e. the Property), the Company will be receiving proceeds from the Disposal and accordingly the Directors do not expect that there will be any material adverse effect on the assets of the Company after completion of the Disposal. It is expected that there will be no effect on the liabilities of the Company in respect of the Disposal.

INFORMATION OF THE GROUP AND THE PURCHASER

The Group is principally engaged in resort and property development, property and investment holding, and the design, manufacture, marketing and distribution of consumer electronic goods. The Vendor, a wholly-owned subsidiary of the Company, is a property holding company.

The Purchaser is engaged in property investment holding.

To the best knowledge, information and belief of the Directors having made all reasonable enquires, the Purchaser and the ultimate beneficial owners of the Purchaser are Independent Third Parties.

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

By Order of the Board Applied Development Holdings Limited Hung Kin Sang, Raymond Executive Director

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. 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 not contained herein the omission of which would make any statement contained in this circular misleading.

2. DISCLOSURE OF INTERESTS

(a) Interests of Directors

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executives of the Company in the Shares, underlying Shares and debentures of the Company or any associated corporation (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are taken or deemed to have under such provisions of the SFO), the Model Code for Securities Transactions by Directors of Listed Companies and which were required to be entered into the register required to be kept under section 352 of the SFO were as follows:

Long positions in Shares

		Founder of a
		discretionary
		trust and		Total
		discretionary		number of	Approximate %
Name	Beneficial	object	Corporate	Shares	shareholding
Hung Kin Sang,	3,280,000	405,655,584	34,329,000	443,264,584	50.06%
Raymond		(Note 1)	(Note 2)
Hung Wong Kar	9,310,056	405,655,584	34,329,000	449,294,640	50.74%
Gee, Mimi		(Note 1)	(Note 2)
Fang Chin Ping	100,000	–	–	100,000	0.01%
Hung Kai Mau,	2,660,000	–	–	2,660,000	0.30%
Marcus
Soo Hung Leung,	1,100,000	–	–	1,100,000	0.12%
Lincoln

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GENERAL INFORMATION

APPENDIX

Notes:

• (1) These Shares are held by the following companies:

Malcolm Trading Inc. Primore Co. Inc. Capita Company Inc.	Number of Shares 43,992,883 2,509,266 359,153,435
	405,655,584

Malcolm Trading Inc., Primore Co. Inc. and Capita Company Inc. are wholly-owned by the Marami Foundation as trustee for the Raymond Hung/Mimi Hung & Family Trust, a discretionary trust the discretionary objects of which include the family members of Hung Kin Sang, Raymond and Hung Wong Kar Gee, Mimi.

• (2) These Shares are held by Applied Investment (Asia) Limited which is a wholly-owned subsidiary of the Company. As Capita Company Inc. owns more than one-third of the issued Shares and Capita Company Inc. is in turn a wholly-owned subsidiary of the Marami Foundation, the trustee of the Raymond Hung/Mimi Hung & Family Trust the discretionary objects of which include the family members of Hung Kin Sang, Raymond and Hung Wong Kar Gee, Mimi, both Hung Kin Sang, Raymond and Hung Wong Kar Gee, Mimi are deemed to be interested in such long positions.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or chief executives of the Company had any interests and short positions in the Shares, underlying Shares and debentures of the Company or any associated corporation (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are taken or deemed to have under such provisions of the SFO), the Model Code for Securities Transactions by Directors of Listed Companies and which were required to be entered into the register required to be kept under section 352 of the SFO.

As at the Latest Practicable Date, none of the Directors had any interest, either direct or indirect, in any assets which have been, since 30 June 2006, being the date to which the latest published audited accounts of the Group were made up, acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group; and

As at the Latest Practicable Date, none of the Directors was materially interested in any contract or arrangement entered into by any member of the Group which is subsisting as at the date of this circular and is significant in relation to the business of the Group.

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GENERAL INFORMATION

APPENDIX

(b) Interests of Shareholders

As at the Latest Practicable Date, so far as is known to the Directors and the chief executives of the Company, the following persons (other than a Director or chief executive of the Company) had an interest or short position in the Shares and underlying Shares which fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

Name	Capacity	Number of Shares	% shareholding
Capita Company Inc.	Beneficial	359,153,435	40.56%
Marami Foundation	Corporate	405,655,584	45.82%
		(Note 1 above)
Applied Investment (Asia)	Beneficial	34,329,000	3.88%
Limited

(c) Substantial shareholding in other members of the Group

As at the Latest Practicable Date, so far as is known to the Directors and the chief executive of the Company, the following persons (other than a Director or chief executive of the Company) are directly or indirectly interested in 10 per cent. or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meeting of any other member of the Group:

Name of Subsidiary	Name of Shareholder	% shareholding
Wideland Electronics Limited	Ma Yi Fat	40%
Wideland Electronics Limited	Ma Siu Lun Frank	9%

Save as disclosed above, the Directors and the chief executives of the Company are not aware that there is any person (other than a Director or chief executive of the Company) who, as at the Latest Practicable Date, had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly, interested in 10 per cent. or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at a general meeting of any other member of the Group.

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GENERAL INFORMATION

APPENDIX

3. SERVICE CONTRACTS

As at the Latest Practicable Date, save as disclosed above, none of the Directors has entered into any service agreement with any member of the Group nor are there any other service agreements proposed which will not expire or be determinable by the Company within one year without payment of compensation (other than statutory compensation).

4. LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration proceedings of material importance and there was no litigation or claim of material importance known to the Directors to be pending or threatened against any member of the Group.

5. COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors or any of his/her associates (as such term is defined in the Listing Rules) had an interest in a business which competes or is likely to compete, either directly or indirectly, with the business of the Group required to be disclosed pursuant to rule 8.10 of the Listing Rules other than those businesses to which the Directors were appointed to represent the interests of the Company and/or the Group.

6. GENERAL

• (i) The secretary of the Company is Lee Wai Fun, Betty, associate member of The Institute of Chartered Secretaries and Administrators and associate member of The Hong Kong Institute of Company Secretaries.

• (ii) The qualified accountant of the Company is Ng Kit Ling, Certified Public Accountant of the Hong Kong Institute of Certified Public Accountants and Member of the Association of Chartered Certified Accountants in United Kingdom.

• (iii) The share registrar and transfer office of the Company in Hong Kong is located at Computershare Hong Kong Investor Services Limited of 46th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

• (iv) The English version of this circular shall prevail over the Chinese text.

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