S.A.S. Dragon Holdings Limited — Proxy Solicitation & Information Statement 2006

May 3, 2006

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this document, 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 S.A.S. Dragon Holdings Limited, you should at once hand this document and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this document, 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 document.

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S.A.S. Dragon Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 1184)

GENERAL MANDATES TO REPURCHASE AND ISSUE SHARES, RE-ELECTION OF DIRECTORS, AMENDMENTS TO THE BYE-LAWS AND NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of the Company to be held at 28/F., Noble Centre, No. 1006, 3rd Fuzhong Road, Futian District, Shenzhen, P.R.C. on 23 May 2006, Tuesday at 11:00 a.m. is set out on pages 10 to 15 of this document. Whether or not you intend to attend the annual general meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s Share Registrars in Hong Kong, Secretaries Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for the holding of the annual general meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the annual general meeting should you so wish.

27 April 2006

LETTER FROM THE BOARD

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S.A.S. Dragon Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 1184)

Directors: Registered Office: Executive: Clarendon House Mr. Yim Yuk Lun, Stanley Church Street Chairman and Managing Director Hamilton Mr. Wong Sui Chuen HM11 Bermuda Non-Executive: Dr. Chang Chu Cheng Principal Office: 6th Floor Independent Non-Executive: Tower B Mr. Chang Ping Kin Hunghom Commercial Centre Mr. Cheung Chi Kwan 37 Ma Tau Wai Road Mr. Liu Chun Ning, Wilfred Hunghom Dr. Lui Ming Wah, J.P. Kowloon Mr. Wong Tak Yuen, Adrian Hong Kong 27 April 2006

To the shareholders

Dear Sir or Madam,

GENERAL MANDATES TO REPURCHASE AND ISSUE SHARES, RE-ELECTION OF DIRECTORS, AMENDMENTS TO THE BYE-LAWS AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

It is proposed that at the annual general meeting of the Company to be held on 23 May 2006, the ordinary resolutions and a special resolution, as set out in the notice of annual general meeting, will be proposed to grant the Directors general mandates for issue of new shares by the Company and for the repurchase by the Company of its own shares, re-election of retiring directors and amendments to the Bye-laws.

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LETTER FROM THE BOARD

GENERAL MANDATE TO ISSUE SHARES

Approval is being sought from the shareholders of the Company to grant a general mandate in order to ensure flexibility and discretion to the directors of the Company (“Directors”) in the event it becomes desirable for the Company to issue new shares equal in aggregate up to 20 per cent. of its existing issued share capital. The obtaining of such a mandate is in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (“Listing Rules”). The Directors wish to state that they have no immediate plans to issue any new shares of the Company.

SHARES REPURCHASE MANDATE

The Listing Rules permit companies with a primary listing on The Stock Exchange of Hong Kong Limited (“the Exchange”) to purchase their own shares, subject to certain restrictions, on the Exchange. At the annual general meeting of the Company to be held on 23 May 2006 an ordinary resolution will be proposed to grant the Directors a general mandate to, inter alia, purchase up to 10 per cent. of the shares of the Company in issue as at the date of the passing of the relevant resolution (“Repurchase Proposal”). In addition, an ordinary resolution will be proposed to provide the Directors with a general mandate to allot and issue new shares of the Company up to an amount not exceeding 20 per cent. of the share capital of the Company in issue as at the date of the passing of such resolution and adding to such general mandate by a separate ordinary resolution to be proposed at the said annual general meeting, any shares purchased by the Company pursuant to the Repurchase Proposal (up to a maximum of 10 per cent. of the Company’s issued share capital as at the date of the resolution). The Company is required by the particular rules in the Listing Rules regulating such share repurchases (the “Share Buy Back Rules”) to send to shareholders an explanatory statement containing all the information reasonably necessary to enable them to make an informed decision on whether to vote for or against the Repurchase Proposal. The explanatory statement required by the Listing Rules to be included in this document is set out in the Appendix I to this circular.

AMENDMENTS TO THE BYE-LAWS

The Stock Exchange has announced certain amendments to the Listing Rules which subject to certain transitional arrangements came into effect on 1 January, 2005. Pursuant to A.4.2 of the Code on Corporate Governance Practices on Appendix 14 of the Listing Rules, every Director, including those appointed for a specific term, shall be subject to retirement by rotation at least once every three years.

To align the Bye-laws with the latest amendments to the Listing Rules, the Directors propose that the Bye-laws be amended in the manner set out in the special resolution of the notice of the annual general meeting. The full text of the proposed amendments to the Bye-laws are set out in the notice of the annual general meeting as set out on pages 10 to 15 of this circular.

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LETTER FROM THE BOARD

ANNUAL GENERAL MEETING

A notice of the annual general meeting is set out pages 10 to 15 of this circular. At the annual general meeting, in addition to the ordinary business of the meeting, resolutions will be proposed to approve the general mandates for issue of new shares by the Company and for the repurchase by the Company of its own shares, re-election of retiring directors and amendments to the Bye-laws respectively.

Pursuant to Bye-law 87, Mr. Wong Sui Chuen, Dr. Chang Chu Cheng and Mr. Wong Tak Yuen, Adrian respectively shall retire by rotation and, being eligible, offer themselves for reelection at the annual general meeting. Their details are set out in Appendix II to this circular.

PROCEDURES FOR DEMANDING A POLL AT GENERAL MEETING

According to Bye-law 66 of the Bye-laws of the Company, a resolution put to the vote of a meeting shall be decided on a show of hands unless (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded by:

• (i) the chairman of such meeting; or

• (ii) at least three Members present in person (or, in the case of a Member being a corporation by its duly authorised representative) or by proxy for the time being entitled to vote at the meeting; or

• (iii) a Member or Members present in person (or, in the case of a Member being a corporation by its duly authorised representative) or by proxy and representing not less than one-tenth of the total voting rights of all Members having the right to vote at the meeting; or

• (iv) a Member or Members present in person (or, in the case of a Member being a corporation by its duly authorised representative) or by proxy and holding shares conferring a right to vote at the meeting being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all the shares conferring that right.

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

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LETTER FROM THE BOARD

RECOMMENDATION

The Directors consider that the general mandate to issue shares and the Repurchase Proposal, the re-election of Directors and amendments to the Bye-laws are in the best interests of the Company and its shareholders and accordingly recommend that all shareholders should vote in favour of the ordinary resolutions and a special resolution to be proposed at the said annual general meeting, as they intend to do so themselves in respect of their own holdings.

Yours faithfully, On behalf of the Board Yim Yuk Lun, Stanley Chairman and Managing Director

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EXPLANATORY STATEMENT

APPENDIX I

This Appendix I serves as an explanatory statement, as required by the Listing Rules, to provide the requisite information in relation to the Repurchase Mandate for your consideration.

1. Share Capital

As at 24 April 2006 being the latest practicable date prior to the printing of this document for ascertaining such information, the issued share capital of the Company comprised 242,540,720 shares of HK$0.10 each. Subject to the passing of the relevant ordinary resolution and on the basis that no further shares are issued or repurchased prior to the annual general meeting on 23 May 2006, the Company will be allowed under the Repurchase Proposal to repurchase a maximum of 24,254,072.

2. Reasons for Repurchases

The Directors believe that the Repurchase Proposal is in the best interests of the Company and its shareholders. Such repurchases may, depending on whether the Company’s shares are trading at prices below the Company’s net asset value per share and funding arrangements at the time, lead to an enhancement of the net value per share of the Company’s shares and its assets and/ or its earnings per share and will only be made when the Directors believe that such repurchases will benefit the Company and its shareholders.

3. Funding of Repurchases

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

There may be a material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited accounts for the year ended 31st December 2005) in the event that the mandate to repurchase shares is exercised in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the mandate to such 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.

4. General

None of the Directors or, to the best of their knowledge having made all reasonable enquiries, any of their associates has any present intention, if the repurchase proposal is approved by the shareholders at the annual general meeting on 23 May 2006, to sell any shares to the Company or its subsidiaries.

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EXPLANATORY STATEMENT

APPENDIX I

The Directors have undertaken to the Exchange that so far as the same may be applicable, they will exercise the repurchase mandate pursuant to the proposed resolution in accordance with the Listing Rules and the applicable laws of Bermuda.

The Company has not repurchased any shares on the Exchange during the past six months.

If as a result of the exercise of the power to repurchase shares pursuant to the repurchase mandate, a shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of the Hong Kong Code on Takeovers and Mergers (“Takeover Code”). As a result a shareholder, or group of shareholders acting in concert depending on the level of increase of the shareholders 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 at 24 April 2006 (being the latest practicable date prior to the printing of this document), Unimicro Limited, as trustee of a unit trust was the beneficial owner of 63,771,400 shares HK$0.10 each. All units in the unit trust are beneficially owned by a discretionary trust established by Mr. Yim Yuk Lun, Stanley, the Chairman and Managing Director of the Company, the beneficiaries of which include the spouse and children of Mr. Yim Yuk Lun, Stanley. Mr. Yim Yuk Lun, Stanley also has personal interest of 6,970,000 shares of HK$0.10 each. Unimicro Limited and Mr. Yim Yuk Lun, Stanley hold shares representing approximately 29.17 per cent. of the total issued share capital of the Company. In the event that the Directors exercise in full the power to repurchase shares, the joint shareholdings of Unimicro Limited and Mr. Yim Yuk Lun, Stanley would increased from approximately 29.17 per cent. to approximately 32.41 per cent., and such increase would give rise to an obligation to make a mandatory offer in accordance with Rule 26 of the Takeover Code. The Directors do not propose to exercise the Repurchase Mandate to such extent as would, in the circumstances, have an effect to give rise to an obligation to make a mandatory offer under Rule 26 of the Takeover Code.

In addition, Foxconn Holding Limited* (“Foxconn”) is the substantial shareholder of the Company holding 46,000,000 shares of HK$0.10 each (represents 18.97 per cent. of the total issued share capital of the company). In the event that the Directors exercise in full the power repurchase the shares, the shareholding of Foxconn would be increased from approximately 18.97 per cent. to approximately 21.07 per cent., and such increase would not give rise to an obligation to make a mandatory offer in accordance with Rule 26 of the Takeover Code.

No connected persons or their associates (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 in the event that the Company is authorized to make purchases of shares.

• Hon Hai Precision Industry Co. Ltd. (“Hon Hai’’) owns 100 per cent. interests in Foxconn. All interests from Foxconn are deemed to be beneficially interested by Hon Hai.

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EXPLANATORY STATEMENT

APPENDIX I

5. Share Prices

The highest and lowest prices at which the Company’s shares were traded on the Exchange during each of the previous twelve months up to 31 March 2006 were as follows:

		shares
	highest		lowest
	HK$		HK$
April 2005	1.01		0.86
May 2005	0.91		0.74
June 2005	0.88		0.81
July 2005	0.85		0.80
August 2005	0.82		0.75
September 2005	0.80		0.75
October 2005	0.80		0.70
November 2005	0.76		0.67
December 2005	0.77		0.70
January 2006	0.78		0.69
February 2006	1.00		0.72
March 2006	0.80		0.70

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DETAILS OF PROPOSED DIRECTORS TO BE RE-ELECTED

APPENDIX II

As required by the Listing Rules, the following are the particulars of the three Directors proposed to be re-elected at the annual general meeting.

Mr. Wong Sui Chuen , aged 52, was appointed as an Executive Director of the Company in January 2003. He is responsible for overall administration operations in the PRC. Mr. Wong has over fifteen years’ experience in the PRC business affairs. He is currently appointed as the Executive Committee of the Fifth Board of Directors of Shenzhen Association of Enterprises with Foreign Investment and committee of the Fourth Board of Directors of Shanghai Chinese Overseas Friendship Association. Save as aforesaid, Mr. Wong has not held any directorship in other listed companies in the past three years.

So far as the directors are aware as at the Latest Practicable Date, Mr. Wong is beneficially interested in 302,000 ordinary shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance. He does not have any relationship with any other directors, senior management or substantial or controlling shareholders of the Company. Mr. Wong has no service contract with the Company and his directors’ remuneration was approximately HKD440,000 for the financial year ended 31 December 2005. He is entitled to a monthly salary of HKD42,000 starting from 1 January 2006. The level of this remuneration was determined on the basis of his responsibilities, the prevailing market conditions and the performance of the Company’s results.

This is no information relating to Mr. Wong that is required to be disclosed pursuant to Rules 13.51 (2)(h) to (v) of the listing rules and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

Dr. Chang Chu Cheng , aged 62, was appointed as a Non-Executive Director of the Company in September 1994. Dr. Chang gained his Doctorate in Solid State Electronics from the University of Manchester Institute of Science & Technology in 1969 and lectured in physics and electronics at the Chinese University of Hong Kong prior to the founding of Varitronix in 1978. He is presently the Group Co-Chairman of Varitronix International Limited. He is also currently a nonexecutive director of Fujikon Industrial Holdings Limited, a member of TDC Electronics/Electrical Appliances Industry Advisory Committee and an Honorary Advisor of Hong Kong Critical Components Manufacturers Association and an Honorary Chairman of Hong Kong Photographic and Optics Manufacturers Association. Save as aforesaid, Dr. Chang has not held any directorship in other listed companies in the past three years.

So far as the directors are aware as at the Latest Practicable Date, Dr. Chang did not have any interest in the shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance. He does not have any relationship with any other directors, senior management or substantial or controlling shareholders of the Company. Dr. Chang has no service contract with the Company and receives no director’s remuneration in 2005.

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DETAILS OF PROPOSED DIRECTORS TO BE RE-ELECTED

APPENDIX II

This is no information relating to Dr. Chang that is required to be disclosed pursuant to Rules 13.51 (2)(h) to (v) of the listing rules and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

Mr. Wong Tak Yuen, Adrian , aged 51, was appointed as an Independent Non-Executive Director of the Company in November 1999. Mr. Wong holds a Bachelor’s degree in Economics and Mathematics from the University of Western Ontairo, London, Canada. Mr. Wong has over twenty years’ experience in the financial Industry. Save as aforesaid, Mr. Wong has not held any directorship in other listed companies in the past three years.

So far as the directors are aware as at the Latest Practicable Date, Mr. Wong did not have any interest in the shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance. He does not have any relationship with any other directors, senior management or substantial or controlling shareholders of the Company. Mr. Wong has no service contract with the Company and his directors’ remuneration was approximately HKD50,000 for the financial year ended 31 December 2005. The director’s fee payable to Mr. Wong for 2006 will be HKD50,000. The level of this remuneration was determined on the basis of his responsibilities, the prevailing market conditions and the performance of the Company’s results.

This is no information relating to Mr. Wong that is required to be disclosed pursuant to Rules 13.51 (2)(h) to (v) of the listing rules and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

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NOTICE OF ANNUAL GENERAL MEETING

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S.A.S. Dragon Holdings Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 1184)

NOTICE IS HEREBY GIVEN that the annual general meeting of the Company will be held at 28/F., Noble Centre, No. 1006, 3rd Fuzhong Road, Futian District, Shenzhen, P.R.C. on 23 May 2006 at 11:00 a.m. for the following purposes:

1. To receive, consider and adopt the audited financial statements and the reports of the directors and auditors for the year ended 31 December 2005;

2. To declare a final dividend of HK5.0 cents in respect of the year ended 31 December 2005;

3. To re-elect directors and to authorize the Board of Directors to fix their remuneration;

4. To re-appoint auditors and to authorize the Board of Directors to fix their remuneration;

As special business, to consider and if thought fit, to pass with or without amendments, the following resolutions as ordinary resolutions:

ORDINARY RESOLUTIONS

1. “ THAT

2. (a) subject to paragraph (b) below, the exercise by the directors of the Company (the “Directors”) during the Relevant Period (as hereinafter defined) of all the powers of the Company to purchase its own shares on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the shares of the Company may be listed and recognized by the Securities and Futures Commission and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws and the requirements of the Rules Governing the Listing of Securities on the Stock Exchange (as amended from time to time) or of any other stock exchange, be and is hereby generally and unconditionally approved and authorized;

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NOTICE OF ANNUAL GENERAL MEETING

• (b) the aggregate nominal amount of the shares of the Company to be purchased by the Company pursuant to the approval in paragraph (a) above during the Relevant Period shall not exceed 10% of the nominal amount of the share capital of the Company in issue as at the date of passing this Resolution and the approval pursuant to paragraph (a) shall be limited accordingly; and

• (c) for the purpose of this Resolution, “Relevant Period” means the period from the passing of this Resolution until whichever is the 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 the bye-laws of the Company or any applicable law to be held; or

  • (iii) the revocation or variation of the authority given under this Resolution by an ordinary resolution of the shareholders of the Company in general meeting”.

• “ THAT

• (a) subject to paragraph (b) below, a general mandate be and is hereby unconditionally given to the directors of the Company (the “Directors”) to exercise all the powers of the Company during the Relevant Period (as hereinafter defined) to allot, issue and deal with the shares in the capital of the Company (including making and granting offers, agreements and options which would or might require the exercise of such powers, whether during the continuance of the Relevant Period or thereafter);

• (b) the aggregate nominal amount of the share capital allotted or agreed conditionally or unconditionally to be allotted or dealt with pursuant to the approval in paragraph (a) above during the Relevant Period, otherwise than pursuant to the following, shall not exceed 20% of the nominal amount of the share capital of the Company in issue as at the date of passing this Resolution and the said approval shall be limited accordingly;

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NOTICE OF ANNUAL GENERAL MEETING

  - (i) a rights issue where shares are offered for a period fixed by the Directors to shareholders on the register on a fixed record date in proportion to their than holdings of such shares (subject to such exclusion or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard, as appropriate, to any restrictions or obligations under the laws of, or the requirements of any recognized regulatory body or stock exchange in, or in any territory applicable to the Company);

  - (ii) an issue of shares under any share option scheme or similar arrangement for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of shares or rights to acquire shares of the Company and approved by the Stock Exchange;

  - (iii) any issue of shares in the Company upon the exercise of subscription rights attaching to any warrants of the Company; or

  - (iv) any scrip dividend scheme or similar arrangement implemented in accordance with the bye-laws of the Company; and

• (c) for the purpose of this Resolution, “Relevant Period” means the period from the passing of this Resolution until whichever is the earlier of;

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

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

  • (iii) the revocation or variation of the authority given under this Resolution by an ordinary resolution of the shareholders of the Company in general meeting”; and

• “ THAT conditionally upon Resolutions Numbers 5 and 6 being, passed, the general mandate granted to the directors of the Company and for the time being in force to exercise the powers of the Company to allot shares in the capital of the company be and is hereby extended by the addition to the nominal value of the share capital which may be allotted or agreed conditionally or unconditionally to be allotted by the directors of the company pursuant to such general mandate an amount representing the aggregate nominal value of the share capital of the Company repurchased by the

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NOTICE OF ANNUAL GENERAL MEETING

Company under the authority granted pursuant to Resolution Number 6, provided that such amount shall not exceed 10% of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing this resolution.”

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

SPECIAL RESOLUTION

1. “ THAT the Bye-laws of the Company be amended in the following manner:-

2. (a) Bye-law 66

The existing Bye-law 66 be deleted in its entirety and substituted by the following new Bye-law 66:-

• “66. Subject to any special rights or restrictions as to voting for the time being attached to any shares by or in accordance with these Bye-laws, at any general meeting on a show of hands every Member present in person (or being a corporation, is present by a representative duly authorised under Section 78 of the Act), or by proxy shall have one vote and on a poll every Member present in person or by proxy or, in the case of a Member being a corporation, by its duly authorised representative shall have one vote for every fully paid share of which he is the holder but so that no amount paid up or credited as paid up on a share in advance of calls or instalments is treated for the foregoing purposes as paid up on the share. Notwithstanding anything contained in these Bye-laws, where more than one proxy is appointed by a Member which is a clearing house (or its nominee(s)), each such proxy shall have one vote on a show of hands. A resolution put to the vote of a meeting shall be decided on a show of hands unless voting by way of a poll is required by the rules of the Designated Stock Exchange or (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded:

• (a) by the chairman of such meeting; or

• (b) by at least three Members present in person (or in the case of a Member being a corporation by its duly authorised representative) or by proxy for the time being entitled to vote at the meeting; or

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NOTICE OF ANNUAL GENERAL MEETING

• (c) by a Member or Members present in person (or in the case of a Member being a corporation by its duly authorised representative) or by proxy and representing not less than one-tenth of the total voting rights of all Members having the right to vote at the meeting; or

• (d) by a Member or Members present in person (or in the case of a Member being a corporation by its duly authorised representative) or by proxy and holding shares in the Company conferring a right to vote at the meeting being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all shares conferring that right; or

• (e) if required by the rules of the Designated Stock Exchange, by any Director or Directors who, individually or collectively, hold proxies in respect of shares representing five per cent. (5%) or more of the total voting rights at such meeting.

A demand by a person as proxy for a Member or in the case of a Member being a corporation by its duly authorised representative shall be deemed to be the same as a demand by a Member.”

• (b) Bye-law 68

The existing Bye-law 68 be amended by deleting the second sentence therein and substituting therefor the following:

“The Company shall only be required to disclose the voting figures on a poll if such disclosure is required by the rules of the Designated Stock Exchange.”

• (c) Bye-law 86

• (i) The existing Bye-law 86(1) be amended by inserting the words “or at any special general meeting” after the words “in accordance with Byelaw 87” in the third sentence of Bye-law 86(1).

• (ii) By deleting the word “special” before the words “resolution remove a Director” in Bye-law 86(4) and substituting therefor the word “ordinary”.

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NOTICE OF ANNUAL GENERAL MEETING

• (d) Bye-law 87

Bye-law 87 be amended by:-

• (i) deleting the existing Bye-law 87(1) in its entirety and substituting therefor the following:

• “87. (1) Notwithstanding any other provisions in the Bye-laws, at each annual general meeting one-third of the Directors for the time being (or, if their number is not a multiple of three (3), the number nearest to but not less than one-third) shall retire from office by rotation, provided that every Director shall be subject to retirement at least once every three years.”

• (ii) inserting the words “and shall continue to act as a Director throughout the meeting at which he retires” after the word “re-election” in the first sentence of Bye-law 87(2).”

On behalf of the Board Yim Yuk Lun, Stanley Chairman and Managing Director

Hong Kong, 24 April 2006

Notes:

• (1) A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of him. A proxy need not be a member of the Company. In order to be valid, the form of proxy must be deposited with the Company’s Share Registrars in Hong Kong in Secretaries Limited, 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong together with any power of attorney or other authority, under which it is signed, or a notarially certified copy of that power or authority, not less than 48 hours before the time for holding the meeting.

• (2) An Explanatory Statement in relation to Resolution Number 5 will be sent to shareholders and other persons who are entitled into.

• (3) The register of members of the Company will be closed from 22 May 2006 to 23 May 2006, both days inclusive. All transfers accompanied by the relevant share certificates must be lodged with the Company’s Share Registrars in Hong Kong, Secretaries Limited, 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong for registration no later than 4:00 p.m. on 19 May 2006.

• (4) Concerning item 6 above, the Directors wish to state that they have no immediate plans to issue any additional new shares of the Company pursuant to the power to be conferred by this mandate. Under the listing rules of the Stock Exchange (as amended from time to time) the general mandate lapses unless it is renewed at each annual general meeting.

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