Pioneer Global Group Limited — Proxy Solicitation & Information Statement 2003

Jul 30, 2003

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about this circular, you should consult your stockbroker, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold all your shares in Pioneer Global Group 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.

PIONEER GLOBAL GROUP LIMITED 建生國際集團有限公司

(Incorporated in Bermuda with limited liability)

Executive Directors: Registered Office: Rossana Wang Gaw (Chairman) Cedar House Goodwin Gaw (Vice Chairman) 41 Cedar Avenue Kenneth Gaw (Managing Director) Hamilton HM 12, Bermuda Jane Kwai Ying Tsui (Company Secretary)

Independent non-executive Directors: Dr. Charles Wai Bun Cheung, JP The Hon. Bernard Charnwut Chan Arnold Tin Chee Ip

Principal office in Hong Kong: 29th Floor Dah Sing Financial Centre 108 Gloucester Road Wanchai, Hong Kong

New Principal office in Hong Kong: Suite 01-03, 30/F, Office Tower Convention Plaza, 1 Harbour Road Wanchai, Hong Kong

25th July, 2003

To the Shareholders

Dear Sir/Madam,

THE GENERAL MANDATE TO REPURCHASE SHARES AND TO ISSUE SHARES

At the Company’s 2002 Annual General meeting (“AGM”) of Pioneer Global Group Limited (the “Company”), the directors of the Company (“Directors”) were granted a general

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mandate to repurchase shares of HK$0.10 each of the Company (“Shares”) up to a maximum of 10% of the aggregate nominal value of the issued share capital of the Company at the date of the relevant resolution (the “Share Repurchase Mandate”) and a general mandate to issue new shares of the Company (the “Share Issue Mandate”). These mandates shall expire upon the conclusion of the 2003 AGM to be held on 8th September, 2003. It is therefore proposed to seek your approval for ordinary resolutions to be proposed at the 2003 AGM to grant to the Directors the Share Repurchase Mandate and Share Issue Mandate to exercise the power of the Company to repurchase issued share capital of the Company and to issue new Shares.

Full texts of the ordinary resolutions are set out in the Notice of AGM in the Annual Report of the Company sent to the shareholders together with this circular and a Form of Proxy for use at the 2003 AGM is therein enclosed. Whether or not you intend to be present in the 2003 AGM, you are requested to complete and return to the Company’s new principal office in Hong Kong at Suite 01-03, 30/F, Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong, the Form of Proxy in accordance with the instructions printed thereon not less than 48 hours before the time appointed for the holding of the 2003 AGM.

The information required by the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) to be sent to shareholders of the Company in connection to the proposed renewal of the Share Repurchase Mandate is set out in the Appendix to this circular.

The Directors considers that the granting of the Share Repurchase Mandate and the Share Issue Mandate are in the best interests of, and for the benefit of, the Company and its shareholders and, accordingly, recommend shareholders to vote in favor of the resolutions to be proposed at the 2003 AGM in respect of such matters.

Yours faithfully, By Order of the Board Rossana Wang Gaw Chairman

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SHARE REPURCHASE MANDATE

APPENDIX

The following is the Explanatory Statement required to be sent to shareholders of the Company under the Listing Rules in connection with the granting to the Directors of the Share Repurchase Mandate.

• (i) It is proposed that up to 10% of the Shares in issue at the date of the passing of the resolution to approve the Share Repurchase Mandate may be repurchased. As at 21st July, 2003, being the latest practicable date prior to the printing of this circular, the number of shares in issue was 748,984,917 shares. On the basis of such figure (and assuming no further shares are issued and no shares are repurchased by the Directors pursuant to the Share Repurchase Mandate granted to them at the 2002 AGM prior to the 2003 AGM), the exercise of the Share Repurchase Mandate in full during the period ending upon the conclusion of the 2004 AGM of the Company or the expiration of the period within which the next AGM of the Company is required by its Bye-Laws or any applicable law of Bermuda to be held or the revocation or variation of the Share Repurchase Mandate by an ordinary resolution of the Company, whichever is the earliest (being the repurchase of 10% of the shares in issue at the date of the passing of the resolution to approve the Share Repurchase Mandate), would enable the Company to repurchase 74,898,491 shares.

• (ii) The Directors believe that it is in the best interests of the Company and its shareholders for the Directors to have a general authority from shareholders to repurchase shares in the market. A repurchase of shares may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net value of the Company and its assets and/or its earnings per share and will only be made when the Directors believe that such repurchase will benefit the Company and its shareholders.

• (iii) The Company is empowered by its Memorandum of Association and Bye-laws to repurchase its shares. Bermuda law provides that the amount of capital repaid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant shares, or the profits that would otherwise be available for distribution by way of dividend or the proceeds of a new issue of shares made for such purpose. The Directors propose that the repurchases of shares pursuant to the Share Repurchase Mandate would be financed from the Company’s internal resources or existing banking facilities.

• (iv) If the Share Repurchase Mandate was exercised in full, it could have a material adverse effect on the working capital or the gearing position of the Company as compared with the position disclosed in the Company’s audited accounts for the year ended 31st March, 2003. The Directors, however, do not propose to exercise the Share Repurchase Mandate to such an extent so as to have such an adverse material impact.

• (v) There are no Directors or (to the best of the knowledge of the Directors, having made all reasonable enquiries) any associates (as defined in the Listing Rules) of Directors who have a present intention to sell shares to the Company in the event that the Share Repurchase Mandate is granted by the shareholders.

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• (vi) The Directors have undertaken to the Stock Exchange that they will exercise the powers of the Company to repurchase shares pursuant to the Share Repurchase Mandate in accordance with the Listing Rules, the applicable laws of Bermuda, the Memorandum of Association of the Company and the Bye-Laws.

• (vii) If a shareholder’s proportionate interest in the voting rights of the Company increase on exercise of the power to repurchase shares pursuant to the Share Repurchase Mandate, such increase will be treated as an acquisition for the purpose of the Hong Kong Code on Takeovers and Mergers (the “Takeovers Code”). As a result, a shareholder or group of shareholders acting in concert, could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code.

As at 21st July, 2003 (the latest practicable date prior to the printing of this circular), Forward Investments, Inc., the single largest shareholder of the Company, holds approximately 23.27% of the issued share capital of the Company. In the event that the Directors exercise in full the power to repurchase shares, the shareholding of Forward Investments, Inc. in the Company would be increased to approximately 25.85% of the issued share capital of the Company. In the opinion of the Directors, such increase may not give rise to an obligation to make a mandatory offer under Rules 26 and 32 of the Takeovers Code.

• (viii) The Company has not repurchased any of its shares (whether on the Stock Exchange or otherwise) in the six months preceding the date of this circular.

• (ix) No connected persons of the Company (as defined in the Listing Rules) have notified the Company of a present intention to sell shares to the Company and no such persons have undertaken not to sell any such shares to the Company in the event that the Share Repurchase Mandate is granted by the shareholders.

• (x) The highest and lowest market prices at which shares have been traded on the Stock Exchange in the previous 12 months are as follows:

	Highest	Lowest
	HK$	HK$
2002
July	0.235	0.230
August *	–	–
September *	–	–
October *	–	–
November	0.210	0.200
December	0.200	0.195
2003
January	0.140	0.124
February	0.148	0.140
March	0.160	0.158
April *	–	–
May *	–	–
June	0.120	0.092

• During the month of August, September and October 2002 and April and May 2003, no share in the Company was traded on the Stock Exchange.

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