Planetree International Development Limited — AGM Information 2013

Apr 15, 2013

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspects 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 YUGANG INTERNATIONAL LIMITED , you should at once hand this circular, together with the enclosed form of proxy to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

YUGANG INTERNATIONAL LIMITED （渝港國際有限公司）*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00613)

PROPOSALS FOR RE-ELECTION OF DIRECTORS, GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, AMENDMENTS TO THE BYE-LAWS AND

NOTICE OF ANNUAL GENERAL MEETING

A notice convening the AGM of Yugang International Limited to be held at 11:15 a.m. on Tuesday, 21 May, 2013 at Salon I & II, Mezzanine Floor, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai, Hong Kong is set out on pages 13 to 17 of this circular.

Whether or not you intend to attend the AGM, you are advised to read this circular and to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s Hong Kong branch share registrar, Tricor Tengis Limited at 26[th] Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for holding of the AGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM or at any adjournment thereof should you so wish.

* For identification purposes only.

16 April 2013

TABLE OF CONTENTS

	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
BUSINESS OF THE MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Resolution 1 — Receiving 2012 Financial Statements . . . . . . . . . . . . . . . . . . . . . . .	3
Resolution 2 — Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Resolution 3 — Re-appointment of Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Resolution 4-6 — General Mandates to Issue and Repurchase Shares . . . . . . . . . . .	4
Resolution 7 — Amendments to the Bye-Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
VOTING BY POLL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
BOARD RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
APPENDIX I — BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED
FOR RE-ELECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
APPENDIX II — EXPLANATORY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
NOTICE OF ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13

— i —

DEFINITIONS

In this circular, unless the context requires otherwise, the following expressions shall have the meanings set out below:

• “AGM” or “Meeting”

the annual general meeting of the Company to be held at 11:15 a.m. on Tuesday, 21 May 2013 at Salon I & II, Mezzanine Floor, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai, Hong Kong, or, where the context so admits, any adjournment thereof;

• “Board” the board of Directors of the Company;

• “Bye-laws” the bye-laws adopted by the Company from time to time;

• “Company”

• Yugang International Limited, a company incorporated in Bermuda with limited liability and the Shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 00613);

• “Director(s)” the 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;

• “HK$” Hong Kong dollars, the lawful currency of Hong Kong;

“Issue Mandate” a general and unconditional mandate proposed to be granted to Directors to exercise powers of the Company to allot, issue and deal with new Shares representing up to 20% of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing of the relevant resolution at the AGM;

• “Latest Practicable Date” 12 April 2013, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained herein;

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

• “Notice of AGM” the notice for convening the AGM as set out on pages 13 to 17 of this circular;

— 1 —

	DEFINITIONS
“Repurchase Mandate”	a general and unconditional mandate proposed to be granted
	to Directors to exercise powers of the Company to repurchase
	Shares representing up to a maximum of 10% of the aggregate
	nominal amount of the share capital of the Company in issue
	as at the date of passing of the relevant resolution at the
	AGM;
“SFO”	Securities and Futures Ordinance, Chapter 571 of the Laws of
	Hong Kong;
“Share(s)”	ordinary share(s) of HK$0.01 each in the issued share capital
	of the Company;
“Shareholder(s)”	the holder(s) of Share(s);
“Stock Exchange”	the Stock Exchange of Hong Kong Limited;
“Takeovers Code”	the Codes on Takeovers and Mergers and Share Repurchases
	published by Securities and Futures Commission; and
“%”	per cent.

— 2 —

LETTER FROM THE BOARD

YUGANG INTERNATIONAL LIMITED （渝港國際有限公司）*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00613)

Executive Directors: Cheung Chung Kiu (Chairman) Yuen Wing Shing (Managing Director) Zhang Qing Xin Lam Hiu Lo Liang Kang

Non-Executive Director: Lee Ka Sze, Carmelo

Independent Non-Executive Directors: Luk Yu King, James Leung Yu Ming, Steven Ng Kwok Fu

Registered Office : Clarendon House Church Street Hamilton HM 11 Bermuda

Head Office and Principal Place of Business in Hong Kong Rooms 3301-3307 China Resources Building 26 Harbour Road Wanchai Hong Kong

16 April 2013

Dear Shareholders,

INTRODUCTION

The purpose of this circular is to give you notice of AGM and the information relating to (i) re-election of Directors, (ii) the grant of Repurchase Mandate, (iii) the grant of Issue Mandate, (iv) the extension of Issue Mandate and (v) amendment to the Bye-laws.

BUSINESS OF THE MEETING

Resolution 1 — Receiving 2012 Financial Statements

The audited consolidated financial statements of the Company and its subsidiaries for the year ended 31 December 2012 together with the Reports of Directors and Auditors thereon, are set out in the 2012 Annual Report. The audited consolidated financial statements have been reviewed by the audit committee of the Company (“ Audit Committee ”).

* For identification purposes only

— 3 —

LETTER FROM THE BOARD

Resolution 2 — Re-election of Directors

Pursuant to Bye-law 87 of the Bye-laws, Mr. Cheung Chung Kiu, Mr. Luk Yu King, James and Mr. Ng Kwok Fu will retire by rotation, and being eligible, offer themselves for re-election at the AGM.

In compliance with the requirements of code provisions E.1.1 of the Corporate Governance Code as set out in Appendix 14 of the Listing Rules, a separate resolution will be proposed at the AGM for the re-election of each individual Director whether such Director is an executive Director, non-executive Director or an independent non-executive Director.

The re-appointment of Directors has been reviewed by the nomination committee of the Company (“ Nomination Committee ”) which made recommendation to the Board that the re-election be proposed for Shareholders’ approval at the AGM. On 4 December, 2012 and 22 March, 2013, the Nomination Committee has also assessed and reviewed the individual independent non-executive Directors’ confirmation of independence based on the independent criteria as set out in Rule 3.13 of the Listing Rules, and affirmed that all independent non-executive Directors including Mr. Luk Yu King, James and Mr. Ng Kwok Fu remained independent.

Biographical details of Directors who are subject to re-election at the AGM are set out in Appendix I to this circular.

Resolution 3 — Re-appointment of Auditors

The Audit Committee has reviewed the work of the external auditors, Messrs. Ernst & Young and was satisfied with their independence and objectivity. Subject to Shareholders’ approval at the AGM, the Audit Committee recommend the re-appointment of Messrs. Ernst & Young as external auditors of the Company for 2013 and authorising Directors to fix their remuneration.

Resolutions 4-6 — General Mandates to Issue and Repurchase Shares

An ordinary resolution ( Resolution 4 ) will be proposed at the AGM to grant to Directors the Issue Mandate. The aggregate number of Shares allotted or agreed to be allotted under the Issue Mandate must not exceed the aggregate of 20% of the issued share capital of the Company at the date of passing of the relevant resolution at the AGM.

Based on the total number of 9,305,276,756 Shares in issue as at the Latest Practicable Date, if the Issue Mandate is exercised in full, it will result in the Directors being authorised to issue, allot and deal with a maximum of 1,861,055,351 Shares.

An ordinary resolution ( Resolution 5 ) will be proposed at the AGM to grant to Directors the Repurchase Mandate. The number of Shares which are authorized to repurchase on the Stock Exchange may not exceed 10% of the issued share capital of the Company at the date of passing of the relevant resolution at the AGM.

— 4 —

LETTER FROM THE BOARD

The authority conferred on Directors by the Issue Mandate and the Repurchase Mandate would continue in force until the earlier 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 law or the Bye-laws to be held; and (iii) its revocation or variation by an ordinary resolution of the Shareholders in a general meeting.

The full text of the resolutions 4-6 is set out in the Notice of AGM. An Explanatory Statement to provide Shareholders with all the information reasonably necessary for them to make an informed decision in relation to these proposed resolutions as required by the Listing Rules concerning the regulation of repurchases by companies of their own securities on the Stock Exchange is set out in Appendix II to this circular.

Resolution 7 — Amendments to the Bye-Laws

The Board proposed to put forward a special resolution to Shareholders at the AGM for the amendments to various provisions in the existing Bye-laws to reflect, principally, the current laws of Bermuda, where (a) the register of members of the Company must be made available to the public for inspection without charge; and (b) the solvency test for paying a dividend or making a distribution out of contributed surplus has been simplified. The full text of the Special Resolution 7 specifying the proposed amendments are set out in the Notice of AGM contained in this circular.

ANNUAL GENERAL MEETING

The Company will convene the AGM at 11:15 a.m. on Tuesday, 21 May 2013 at Salon I & II, Mezzanine Floor, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai, Hong Kong. The Notice of AGM is set out on pages 13 to 17 of this circular. Detailed information and explanation on the business to be considered at the AGM, together with the Board recommendation on the proposed resolutions, are set out in this circular.

A form of proxy for use at the AGM is enclosed herewith. Whether or not you intend to attend the AGM, you are advised to read this circular and to complete the accompanying form of proxy and return the same to the Company’s Hong Kong branch share registrar, Tricor Tengis Limited at 26[th] Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time for holding the AGM or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting at the AGM or any adjournment if you so wish.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, all resolutions set out in the notice of AGM will be decided by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matters to be voted on by a show of hands. On a poll, pursuant to Bye-law 66, every Shareholder present in person or by proxy or, in the case of a Shareholder being

— 5 —

LETTER FROM THE BOARD

a corporation, by its duly authorised representative, shall have one vote for every fully paid share of which he/she/it is the holder. Shareholders present in person or by proxy or by authorized representative who are entitled to more than one vote do not have to vote all of their shares nor do they have to cast all of their votes in the same way.

After closing the poll, the Company’s Hong Kong branch share registrar will count the votes and the poll results will be subject to scrutiny by an independent scrutineer.

The Company will announce the results of the poll in the manner prescribed under Rule 13.39(5) of the Listing Rules.

BOARD RECOMMENDATION

The Board considers that the proposed resolutions as set out in the Notice of AGM, including, among other things, re-election of Directors, the granting of the Issue Mandate, Repurchase Mandate and the extension of the Issue Mandate, and the amendments to the Bye-laws are in the best interests of the Company and its Shareholders as a whole. Accordingly, the Board recommends you to vote in favour of all resolutions at the AGM.

Yours faithfully, On behalf of the Board Yugang International Limited YUEN WING SHING Managing Director

— 6 —

APPENDIX I

BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

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

CHEUNG CHUNG KIU — Executive Director and the Chairman

Cheung Chung Kiu , aged 48, was appointed the chairman and an executive Director of the Company in 1993. Mr. Cheung is the chairman and a member of the Nomination Committee, a member of the Remuneration Committee and an authorised representative of the Company. Mr. Cheung also serves as a director of several subsidiaries of the Company. In addition, Mr. Cheung is the director of Palin Holdings Limited, Chongqing Industrial Limited and Timmex Investment Limited, all are companies disclosed in the section headed “Interests of Substantial Shareholders” on page 29 of the annual report. Mr. Cheung is the founder of the Company and he set up Chongqing Industrial Limited in 1985, a company mainly engaged in trading business in the PRC. Mr. Cheung is also the chairman of Y. T. Realty Group Limited, The Cross-Harbour (Holdings) Limited and C C Land Holdings Limited, all are public companies listed on the Stock Exchange. Further, Mr. Cheung is the son of Mr. Zhang Qing Xin, a Director of the Company. Save as disclosed above, Mr. Cheung has not held any directorship in other public listed companies during the last three years.

As at the Latest Practicable Date, Mr. Cheung was interested in 4,099,709,740 Shares of the Company. Save as disclosed herein, Mr. Cheung does not have any interests in the Shares of the Company within the meaning of Part XV of the SFO.

The emoluments of Mr. Cheung are recommended by the Remuneration Committee and determined by the Board with authorization from time to time given by Shareholders in general meeting according to the remuneration policy of the Company and by reference to his time commitment, duties and responsibilities undertaken, employment conditions elsewhere in the Group and salaries paid by comparable companies. Mr. Cheung’s emoluments for the year ended 31 December 2012 were HK$9,603,750.00. Mr Cheung has not entered into a service contract with the Company and has no fixed term of service but subject to retirement by rotation and re-election once every three years pursuant to the Bye-laws.

LUK YU KING, JAMES — Independent Non-Executive Director

Luk Yu King, James , aged 58, was appointed an independent non-executive Director of the Company in September 2007. He is the chairman and a member of the Audit Committee. Mr. Luk graduated from The University of Hong Kong with a bachelor degree in Science. He is a fellow of The Association of Chartered Certified Accountants, an associate of The Hong Kong Institute of Certified Public Accountants and an ordinary member of Hong Kong Securities and Investment Institute (formerly known as Hong Kong Securities Institute). Mr. Luk has over ten years of experience in corporate finance, securities and commodities trading business with several international and local financial institutions. Mr. Luk is an independent non-executive director of Y. T. Realty Group Limited and The Cross-Harbour (Holdings) Limited, all are public companies listed on the Stock Exchange. Save as disclosed above, Mr. Luk has not held any directorship in other public listed companies during the last three years.

— 7 —

APPENDIX I

BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

As at the Latest Practicable Date, Mr. Luk does not have any interests in the Shares of the Company within the meaning of Part XV of the SFO. On 4 December 2012 and 22 March, 2013, the Nomination Committee has assessed and reviewed the independent confirmation of Mr. Luk based on the criteria set out in Rule 3.13 of the Listing Rules, and affirmed that he has remained independent. In addition, the Board is satisfied that Mr. Luk has the required character, integrity, independence and experience to fulfill the role of an independent non-executive Director.

The emoluments of Mr. Luk are recommended by the Remuneration Committee and determined by the Board with authorization from time to time given by Shareholders in general meeting according to the remuneration policy of the Company by reference to his time commitment, duties and responsibilities undertaken, employment conditions elsewhere in the Group and salaries paid by comparable companies. Mr. Luk’s emoluments for the year ended 31 December 2012 were HK$400,000.00. In accordance with the Bye-laws, Mr. Luk shall retire as Director at the AGM and, being eligible, shall be re-elected for a term of not more than three years expiring at the conclusion of the annual general meeting of the Company to be held in the third year following the year of his appointment.

NG KWOK FU — Independent Non-Executive Director

Ng Kwok Fu , aged 41, was appointed an independent non-executive Director of the Company on 30 September 2004. Mr. Ng is a member of the Audit Committee, Remuneration Committee and Nomination Committee. Mr. Ng holds a certificate in accounting from Grant MacEwan Community College. Mr. Ng has over 23 years experience in marketing, trading and purchasing of construction materials and providing technical control, support and management in building projects. He is an independent non-executive director of Y. T. Realty Group Limited and The Cross-Harbour (Holdings) Limited, all are public companies listed on the Stock Exchange. Save as disclosed above, Mr. Ng has not held any directorship in other public listed companies in the last three years.

As at the Latest Practicable Date, Mr. Ng does not have any interests in the Shares of the Company within the meaning of Part XV of the SFO. On 4 December 2012 and 22 March 2013, the Nomination Committee has assessed and reviewed the independent confirmation of Mr. Ng based on the criteria set out in Rule 3.13 of the Listing Rules, and affirmed that he has remained independent. In addition, the Board is satisfied that Mr. Ng has the required character, integrity, independence and experience to fulfill the role of an independent non-executive Director.

The emoluments of Mr. Ng are recommended by the Remuneration Committee and determined by the Board with authorization from time to time given by Shareholders in general meeting according to the remuneration policy of the Company and by reference to his time commitment, duties and responsibilities undertaken, employment conditions elsewhere in the Group and salaries paid by comparable companies. Mr. Ng’s emoluments for the year ended 31 December 2012 were HK$200,000.00. In accordance with the Bye-laws, Mr. Ng shall retire as Director at the AGM and, being eligible, shall be re-elected for a term of not more than three years expiring at the conclusion of the annual general meeting of the Company to be held in the third year following the year of his appointment.

— 8 —

APPENDIX I

BIOGRAPHICAL DETAILS OF DIRECTORS PROPOSED FOR RE-ELECTION

OTHER INFORMATION

Save as disclosed herein, none of the above Directors to be re-elected have any relationship with any other Directors, senior management or substantial or controlling Shareholders of the Company, and there is no information which is required to be disclosed pursuant to Rules 13.51(2) of the Listing Rules, and the Board is not aware of any other matters which need to be brought to the attention of the Shareholders.

— 9 —

EXPLANATORY STATEMENT

APPENDIX II

This Appendix serves as an explanatory statement required to be sent to Shareholders under the Listing Rules in connection with the resolutions authorising the proposed Repurchase Mandate.

THE LISTING RULES

The Listing Rules permit a company with a primary listing on the Stock Exchange to repurchase its securities on the Stock Exchange subject to certain restrictions, the most important of which are summarised below:

• (a) the shares proposed to be purchased by the company are fully-paid up;

• (b) the company has previously sent to its shareholders an explanatory statement complying with the provisions of Rule 10.06(1)(b) of the Listing Rules; and

• (c) the shareholders have given a specific approval or a general mandate to the directors of the company to make the purchase, by way of an ordinary resolution which complies with Rule 10.06(1)(c) of the Listing Rules and which has been passed at a general meeting of the company duly convened and held.

SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 9,305,276,756 Shares. Subject to the passing of the ordinary resolution 5 approving the Repurchase Manadate and on the basis that no further Shares are issued or repurchased following the Latest Practicable Date and up to the date of the AGM, exercise in full of the Repurchase Manadate could accordingly result in up to 930,527,675 Shares being repurchased by the Company.

REASONS FOR REPURCHASES

The Directors believe that it is in the best interests of the Company and its Shareholders to have a general authority from Shareholders to enable the Company to repurchase Shares in the market. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the Company’s net assets value and/or earnings per Share and will only be made when the Directors believe that such repurchases will benefit the Company and its Shareholders as a whole.

FUNDING OF REPURCHASES

In repurchasing its Shares, the Company may only apply funds legally available for such purpose in accordance with its Bye-laws and all the applicable laws of Bermuda. Under Bermuda law, purchases may only be effected out of the capital paid up on the purchased shares or out of funds of the company otherwise available for dividend or distribution or out of the proceeds of a fresh issue of shares made for such purpose. Any premium payable on a purchase over the par value of the shares to be purchased must be provided for out of funds of the company otherwise available for dividend or distribution or out of the company’s share premium account.

— 10 —

APPENDIX II

EXPLANATORY STATEMENT

Based on the position disclosed in the Company’s most recent published audited accounts for the year ended 31 December 2012 and taking into account the current financial position of the Company, the Directors consider that no material adverse effect on the financial and gearing position of the Company may result in the event that the Repurchase Mandate is to be exercised in full in the period before the Repurchase Mandate expires. The Directors however do not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or the gearing levels which, in the opinion of the Directors, are from time to time appropriate for the Company.

EFFECT OF TAKEOVERS 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 Takeovers Code. In certain circumstances, a Shareholder or a group of Shareholders acting in concert, as a result of increase of its or their interests in the voting rights of the Company, could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, the following persons held the following percentage of the Shares of the Company:

	Number of shares	Percentage of
Name	of HK$0.01 each	holding
Palin Holdings Limited (Note 1)	3,194,434,684	34.33%
Chongqing Industrial Limited (Note 2)	3,194,434,684	34.33%
Timmex Investment Limited (Note 3)	851,955,056	9.16%
Cheung Chung Kiu (Note 4)	4,099,709,740	44.06%

Notes:

• (1) Palin Holdings Limited is the trustee for Palin Discretionary Trust, a family discretionary trust, the objects include Mr. Cheung Chung Kiu and his family. The voting rights of these Shares are exercisable by Chongqing Industrial Limited.

• (2) The voting rights of these Shares are exercisable by Chongqing Industrial Limited which is controlled by Mr. Cheung Chung Kiu.

• (3) Timmex Investment Limited is 100% beneficially owned by Mr. Cheung Chung Kiu.

• (4) Out of 4,099,709,740 Shares, 3,194,434,684 Shares are held by Chongqing Industrial Limited, 851,955,056 Shares are held by Timmex Investment Limited and 53,320,000 Shares are held by Mr. Cheung Chung Kiu personally.

— 11 —

APPENDIX II

EXPLANATORY STATEMENT

If, which is not presently contemplated, the Directors exercise in full the power to repurchase Shares under the Repurchase Mandate, the shareholding of Palin Holdings Limited, Chongqing Industrial Limited, Timmex Investment Limited and Mr. Cheung Chung Kiu in aggregate would be increased from 44.06% to 48.95% and such increase will give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code. However, the Directors have no present intention to exercise the Repurchase Mandate to such an extent as would, in the circumstances, result in possible mandatory offer being made under the Takeovers Code.

UNDERTAKING

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the power of the Company conferred to them under the Repurchase Mandate in accordance with the Listing Rules and all the applicable laws of Bermuda.

To the best of Directors’ knowledge and having made all reasonable enquiries, none of Directors or any of their associates (as defined in the Listing Rules) have any present intention to sell Shares to the Company or its subsidiaries if the Repurchase Mandate is approved by the Shareholders.

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

SHARE REPURCHASE MADE BY THE COMPANY

The Company had not repurchased any of its Shares, whether on the Stock Exchange or otherwise, during the six months preceding the date of this circular.

SHARE PRICES

The highest and lowest prices at which the Shares were traded on the Stock Exchange during the previous twelve months prior to the Latest Practicable Date were as follows:

	Price per share	Price per share
	Highest	Lowest
	HK$	HK$
April 2012	0.043	0.040
May 2012	0.042	0.037
June 2012	0.045	0.037
July 2012	0.045	0.040
August 2012	0.046	0.039
September 2012	0.068	0.040
October 2012	0.062	0.051
November 2012	0.067	0.052
December 2012	0.068	0.060
January 2013	0.070	0.061
February 2013	0.065	0.057
March 2013	0.062	0.055
April 2013 (up to the Latest Practicable Date)	0.056	0.050

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NOTICE OF ANNUAL GENERAL MEETING

YUGANG INTERNATIONAL LIMITED （渝港國際有限公司）*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00613)

NOTICE IS HEREBY GIVEN THAT the annual general meeting (“AGM”) of Yugang International Limited (the “Company”) will be held at 11:15 a.m. on Tuesday, 21 May 2013 at Salon I & II, Mezzanine Floor, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai, Hong Kong to transact the following ordinary businesses:

1. To receive and consider the audited consolidated financial statements of the Company and its subsidiaries for the year ended 31 December 2012 together with the Reports of Directors and Auditors thereon.

2. 2.a. To re-elect the following directors of the Company (“Directors”);

3. (i) Mr. Cheung Chung Kiu as an executive Director;

4. (ii) Mr. Luk Yu King, James as an independent non-executive Director;

(iii) Mr. Ng Kwok Fu as an independent non-executive Director;

• 2.b. To authorise the board of Directors to fix the remuneration of Directors.

• To re-appoint Messrs. Ernst & Young as auditors of the Company and to authorise the Directors to fix their remuneration.

By way of special business, to consider, and if thought fit, pass with or without modifications, the following resolutions as ordinary resolutions:

ORDINARY RESOLUTIONS

Resolution 4 — Issue Mandate

1. “ THAT :

2. (a) a general mandate be and is hereby unconditionally granted to Directors to exercise during the Relevant Period (as hereinafter defined) all powers of the Company to allot, issue and deal with unissued shares of the Company (“Shares”) or securities convertible into Shares or options, warrants or similar rights to subscribe for any Shares and to make or grant offers, agreements or options which would or might require the exercise of such powers

3. For identification purposes only

— 13 —

NOTICE OF ANNUAL GENERAL MEETING

either during or after the Relevant Period, in addition to any Shares which may be issued on a Rights Issue (as hereinafter defined) or under any option scheme or similar arrangement for the time being adopted for the grant or issue to the employees of the Company and/or any of its subsidiaries or any other eligible person(s) of Shares or rights to acquire Shares, or upon the exercise of rights of subscription or conversion under the terms of any existing warrants, bonds, debentures, notes or other securities issued by the Company which carry rights to subscribe for or are convertible into Shares or any scrip dividend pursuant to the bye-laws of the Company (“Bye-laws”) from time to time, not exceeding twenty percent (20%) of the aggregate nominal value of the share capital of the Company in issue as at the date of this Resolution; and

• (b) for the purposes of this Resolution, “Relevant Period” means the period from the passing of this Resolution until the earlier 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 law or Bye-laws to be held; or

• (iii) the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the shareholders of the Company (“Shareholders”) in general meeting.

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

Resolution 5 — Repurchase Mandate

1. “ THAT :

2. (a) a general mandate be and is hereby unconditionally granted to Directors to exercise during the Relevant Period (as hereinafter defined) all powers of the Company to repurchase shares of the Company on the Stock Exchange of Hong Kong Limited (“Stock Exchange”) or on any other stock exchange on which the shares of the Company may be listed and which 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 regulations, subject to the following conditions:

   • (i) such mandate shall not extend beyond the Relevant Period (as hereinafter defined);

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NOTICE OF ANNUAL GENERAL MEETING

• (ii) such mandate shall authorize Directors to procure the Company to repurchase Shares at such price as Directors may at their discretion determine;

• (iii) the aggregate nominal amount of Shares to be repurchased by the Company pursuant to this Resolution during the Relevant Period shall be no more than ten percent (10%) of the aggregate nominal amount of the share capital of the Company in issue at the date of passing of this Resolution; and

• (b) for the purpose of this Resolution, “Relevant Period” means the period from the passing of this Resolution until the earlier 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 law or Bye-laws to be held; or

• (iii) the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the Shareholders in general meeting.”

Resolution 6 — Extension Mandate

1. “ THAT :

2. (a) subject to the availability of unissued share capital and conditional upon the passing of the Resolutions 4 and 5 as set out in the notice of AGM, the aggregate nominal amount of the Shares which are repurchased by the Company pursuant to and in accordance with Resolution 5 set out in the notice of AGM shall be added to the aggregate nominal amount of the share capital of the Company that may be allotted or agreed conditionally or unconditionally to be allotted by Directors pursuant to and in accordance with Resolution 4 set out in the notice of AGM.”

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NOTICE OF ANNUAL GENERAL MEETING

SPECIAL RESOLUTION

Resolution 7 — Amendment to the Bye-laws

As special business, to consider and, if thought fit, pass with or without modification the following special resolution:

THAT the bye-laws of the Company (“Bye-laws”) be and are hereby amended in the following manner:

• (a) Bye-law 44

By deleting the existing Bye-law 44 in its entirety and replacing therewith the following:

“44. The Register and branch register of Members, as the case may be, shall be open to inspection between 10 a.m. and 12 noon on every business day by Members and members of the public without charge at the Office or such other place at which the Register is kept in accordance with the Act. The Register including any overseas or local or other branch register of Members may, after notice has been given by advertisement in an appointed newspaper and where applicable, any other newspapers in accordance with the requirements of any Designated Stock Exchange or by any means in such manner as may be accepted by the Designated Stock Exchange to that effect, be closed for inspection at such times or for such periods not exceeding in the whole thirty (30) days in each year as the Board may determine and either generally or in respect of any class of shares.”

• (b) Bye-law 138

By deleting the words “the aggregate of its liabilities and its issued share capital and share premium account” in Bye-law 138 and replacing therewith the words “its liabilities”.

On behalf of the Board Yuen Wing Shing Managing Director

Hong Kong, 16 April 2013

Notes:

1. A member who is a holder of two or more Shares, and who is entitled to attend and vote at the AGM is entitled to appoint one or more than one proxy or a duly authorised corporate representative to attend and, on a poll, vote in his stead. A proxy need not be a member of the Company. Completion and return of the form of proxy will not preclude a member from attending the AGM and voting in person. In such event, his form of proxy will be deemed to have been revoked.

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1. In order to be valid, the form of proxy, which will be enclosed with the circular of the Company, together with the power of attorney or other authority, if any, under which it is signed, or a notarially certified copy of such power or authority, must be deposited at the Company’s Hong Kong branch share registrar, Tricor Tengis Limited at 26[th] Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong not less than 48 hours before the time for holding the AGM or any adjournment thereof.

2. Pursuant to Rule 13.39(4) of the Listing Rules, all votes of the shareholders at the meeting except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands will be taken by poll and the Company will announce the results of the poll in the manner prescribed under Rule 13.39(5) of the Listing Rules.

3. With regard to resolution 2, resolutions 4 to 7 set out in the notice, a circular giving details of the re-election of Directors, general mandates to issue and repurchase shares of the Company and amendments to the Bye-laws will be despatched to Shareholders on 16 April 2013. The biographical details of the retiring Directors who are proposed to be re-elected at the above meeting are set out in Appendix I to the circular.

4. As at the date of this circular, the Board comprises nine directors, namely Mr. Cheung Chung Kiu (Chairman), Mr. Yuen Wing Shing (Managing Director), Mr. Zhang Qing Xin, Mr. Lam Hiu Lo and Mr. Liang Kang as executive Directors; Mr. Lee Ka Sze, Carmelo as non-executive Director; and Mr. Luk Yu King, James, Mr. Leung Yu Ming, Steven and Mr. Ng Kwok Fu as independent non-executive Directors.

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