Television Broadcasts Limited — Capital/Financing Update 2011

May 13, 2011

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 290)

Website: http://www.290.com.hk

Placing Agent

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Fortune (HK) Securities Limited

(I) PLACING OF NEW SHARES UNDER SPECIFIC MANDATE

AND

(II) PROPOSED CHANGE OF COMPANY NAME

(I) THE PLACING AGREEMENT

On 12 May 2011 (after trading hours), the Placing Agreement was entered into by and between the Company and the Placing Agent, pursuant to which the Company conditionally agreed to place, through the Placing Agent, all of the 150,000,000 Placing Shares at HK$0.33 per Placing Share, on a best-effort basis. The Placing Shares represent approximately 5.20% of the existing issued share capital of the Company and approximately 4.94% of the issued share capital of the Company as enlarged by the allotment and issuance of the Placing Shares.

The Placing Price of HK$0.33 represents (i) a discount of approximately 4.35% to the closing price of HK$0.345 per Share as quoted on the Stock Exchange on 12 May 2011, being the date of the Placing Agreement; and (ii) a premium of approximately 2.17% to the average closing price of approximately HK$0.323 per Share as quoted on the Stock Exchange for the last five trading days immediately prior to the date of the Placing Agreement.

The Placing is conditional upon (i) passing of the resolution(s) in relation to the Placing and the transactions contemplated thereunder and the Specific Mandate by the Shareholders at the EGM; (ii) the Placing Agent successfully procuring Placees to subscribe for the Placing Shares during the Placing Period and (iii) the Listing Committee of the Stock Exchange granting approval for the listing of, and permission to deal in, the Placing Shares.

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The maximum gross proceeds and net proceeds from the Placing will be approximately HK$49.5 million and HK$49 million, respectively. The Company intends to use the net proceeds from the Placing for general working capital of the Group.

(II) PROPOSED CHANGE OF COMPANY NAME

The Board proposes to change the name of the Company from ‘‘China Fortune Group Limited 中國富強集團有限公司’’ to ‘‘China Fortune Financial Group Limited 中國富強 金融集團有限公司’’.

GENERAL

Application will be made by the Company to the Listing Committee of the Stock Exchange for the grant of approval for the listing of, and permission to deal in, the Placing Shares.

The EGM will be convened and held for the Shareholders to consider and, if thought fit, pass the relevant resolution(s) to approve (i) the Placing Agreement and the transactions contemplated thereunder and the Specific Mandate and (ii) the Proposed Change of Company Name.

A circular containing, among others, (i) further details of the Placing Agreement and the transactions contemplated thereunder and the Specific Mandate; (ii) details of the Proposed Change of Company Name; and (iii) a notice convening the EGM will be despatched to the Shareholders as soon as practicable in accordance with the requirements of the Listing Rules.

Completion of the Placing is subject to the satisfaction of the conditions precedent in the Placing Agreement. As the Placing Agreement may or may not proceed, Shareholders and potential investors are advised to exercise caution when dealing in Shares.

(I) THE PLACING AGREEMENT

Date

12 May 2011

Issuer

The Company

Placing Agent and Placees

Fortune (HK) Securities Limited, a company incorporated in Hong Kong and a whollyowned subsidiary of the Company, agreed to place, on a best-effort basis, all of the 150,000,000 Placing Shares and shall be entitled to a placing commission of 1% of the aggregate consideration received by the Company from the sale of Placing Shares on the Completion Date. The placing commission is being set lower than the market rate since the Placing Agent is a wholly-owned subsidiary to the Company. The Directors are of the view that the placing commission is fair and reasonable.

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The Placing Agent agreed to procure not less than six Placees, to subscribe for the Placing Shares at the Placing Price within the Placing Period on a best-effort basis. The Placing Agent agreed to use its reasonable endeavours to ensure that (i) it will not offer or place any of the Placing Shares to or with any person, firm or company which is a connected person (as defined in the Listing Rules) of the Company other than in the situation where the consent from the Stock Exchange has been obtained and in compliance with the Listing Rules; and (ii) the terms of the placing letter with the Placees will not be in breach of the terms of the Placing Agreement.

Number of Placing Shares

The 150,000,000 Placing Shares represent approximately 5.20% of the existing issued share capital of the Company of 2,887,335,668 Shares as at the date of this announcement and approximately 4.94% of its issued share capital as enlarged by the Placing. The aggregate nominal value of the Placing Shares under the Placing will be HK$15,000,000.

Placing Price

The Placing Price of HK$0.33 represents:

• (i) a discount of approximately 4.35% to the closing price of HK$0.345 per Share as quoted on the Stock Exchange on 12 May 2011, being the date of the Placing Agreement; and

• (ii) a premium of approximately 2.17% to the average closing price of approximately HK$0.323 per Share as quoted on the Stock Exchange for the last five trading days immediately prior to the date of the Placing Agreement.

The net placing price under the Placing is approximately HK$0.3267 per Placing Share.

The Directors consider that the Placing Price, which was agreed after arm’s length negotiations between the Company and the Placing Agent with reference to the market price of the Shares in recent months, is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Ranking of the Placing Shares

The Placing Shares, when issued and fully paid, will rank pari passu in all respects with the other Shares in issue or to be issued by the Company on or prior to the Completion Date and the Placees shall be entitled to exercise all rights attached or accruing to the Placing Shares including the rights to all dividends and other distributions or any return of capital declared, made or paid at any time after the date of allotment.

Specific Mandate

The Placing Shares will be allotted and issued under the Specific Mandate.

As at the date of this announcement, 280,534,000 Shares had been issued and allotted pursuant to the placing agreement dated 8 December 2010, which had utilized the entire general mandate granted to the Directors by a resolution of the Shareholders passed at the annual general meeting of the Company held on 31 August 2010. As a result, there is no existing general mandate available for the allotment and issuance of the Placing Shares under the Placing.

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Conditions Precedent

The Placing is conditional upon:

• (a) The proposed grant of the Specific Mandate being granted by the Shareholders in the EGM as there is no existing general mandate available to cover the new Shares to be allotted and issued to satisfy the Placing of the Placing Shares;

• (b) the Placing Agent successfully procuring Placees to subscribe for the Placing Shares in their entirety during the Placing Period (or such later time and date as the Placing Agent and the Company shall agree in writing); and

• (c) the Company’s compliance with and procurement of the compliance of all conditions imposed by the Stock Exchange or by any other competent authority (in Hong Kong or elsewhere) for permission to deal in the Placing Shares issued or to be issued and ensure the continued compliance thereof (provided in each case that the Placees comply with and satisfies all such conditions).

If the above conditions are not fulfilled prior to expiry of the Placing Period or such later date as may be agreed between the Company and the Placing Agent, the Placing Agreement will lapse and become null and void and the parties to the Placing Agreement shall be released from all obligations under the Placing Agreement, save the liabilities for any antecedent breaches thereof.

Termination and force majeure events

If at any time prior to 10: 00 a.m. of the day immediately preceding the Completion Date:

• (a) there develops, occurs or comes into force:

• (i) any new law or regulation or any change in existing laws or regulations or the interpretation thereof which may in the opinion of the Placing Agent and in its absolute discretion may materially and adversely affect the business or financial condition or prospects of the Group as a whole; or

• (ii) any local, regional, national or international event or change (whether or not permanent or forming part of a series of events or changes occurring or continuing, on and/or after the date hereof) of a political, military, economic or other nature (whether or not ejusdem generis with the foregoing) which, in the sole opinion of the Placing Agent and in its absolute discretion will, or may be expected to, have a material adverse effect on the Placing; or

• (iii) any significant change (whether or not permanent) in local, regional, national or international market conditions (or in conditions affecting a sector of the market) which in the sole opinion of the Placing Agent and in its absolute discretion has or may have a material adverse effect on the Placing; or

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• (b) any breach of any of the warranties which in the sole opinion of the Placing Agent and in its absolute discretion is material in the context of the Placing, comes to the knowledge of the Placing Agent or there has been a breach by the Company of any other provision of the Placing Agreement which in the sole opinion of the Placing Agent and in its absolute discretion is material in the context of the Placing;

then and in any such case, the Placing Agent may, in its sole and absolute discretion, terminate the Placing Agreement without liability to the Company or any other party by giving notice in writing to the Company, which notice may be given at any time prior to the Completion Date.

Completion of the Placing

Completion of the Placing shall take place on the Completion Date.

REASONS FOR THE PLACING AND USE OF PROCEEDS

The Company acts as an investment holding company. The Group is principally engaged in the provision of brokerage services for securities, futures and insurance and margin financing.

The maximum gross proceeds from the Placing will be approximately HK$49.5 million. The Company plans to use the maximum net proceeds of approximately HK$49 million from the Placing for general working capital of the Group.

The Directors are of the view that the Placing will enlarge the shareholder base and the capital base of the Company. In addition, the net proceeds of the Placing will strengthen the Group’s financial position for the development of the principal business of the Group. Accordingly, they consider that the Placing is in the interests of the Company and the Shareholders as a whole.

CHANGES TO THE EXISTING ISSUED SHARE CAPITAL OF THE COMPANY AS A RESULT OF THE PLACING

The table below sets out the issued share capital of the Company (i) as at the date of this announcement; and (ii) as it would be immediately after completion of the Placing (assuming no conversion of convertible notes and convertible bonds):

Name of Shareholders Mankind Investment Limited (Note 1) Jadehero Limited (Note 2) Placees Existing public Shareholders	Shareholding in the Company as at the date of this announcement Number of Shares Approximately % 500,000,000 17.32% 800,000,000 27.71% — — 1,587,335,668 54.97% 2,887,335,668 100%	Shareholding in the Company upon completion of the Placing Number of Shares Approximately % 500,000,000 16.46% 800,000,000 26.34% 150,000,000 4.94% 1,587,335,668 52.26% 3,037,335,668 100%	Shareholding in the Company upon completion of the Placing Number of Shares Approximately % 500,000,000 16.46% 800,000,000 26.34% 150,000,000 4.94% 1,587,335,668 52.26% 3,037,335,668 100%
			100%

Notes:

1. These Shares are held by Mankind Investment Limited (‘‘Mankind Investment’’), a company incorporated in the British Virgin Islands with limited liability.

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Mankind Investment is wholly-owned by China Cinda (HK) Asset Management Co., Limited, which is ultimately owned by China Cinda Asset Management Co., Limited.

1. These Shares are held by Jadehero Limited (‘‘Jadehero’’), a company incorporated in the British Virgin Islands with limited liability. Jadehero also holds an option entitling Jadehero to subscribe for convertible bonds of the Company in the maximum principal sum of HK$128 million with an initial conversion price of HK$0.16 per conversion share.

Jadehero is owned as to 20% by Marvel Steed Limited and as to 80% by Southlead Limited. Mr. Wong Kam Fat, Tony (‘‘Mr. Wong’’), the vice-chairman of the Company and a non-executive Director, is the sole beneficial owner of the entire equity interest in Marvel Steed Limited whereas Mr. Xia Yingyan (‘‘Mr. Xia’’), an executive Director, is the sole beneficial owner of the entire equity interest in Southlead Limited. Accordingly, Mr. Wong and Mr. Xia are deemed to be interested in the aforesaid Shares and option that are held by Jadehero.

As at the date of this announcement, the Company has convertible notes and convertible bonds in the principal amount of approximately HK$45.88 million to subscribe for approximately 316.75 million Shares, option to subscribe for zero coupon convertible bonds in a maximum principal amount of HK$128 million convertible into a maximum of 800 million Shares and warrants to subscribe for 12 million Shares which, in aggregate, entitle their holders to subscribe for approximately 1,128.75 million new Shares, which would represent approximately 39.09% of the issued share capital of the Company as at date of announcement and 37.16% of the share capital of the Company as enlarged by the subscription of the abovementioned new Shares and assuming completion of the Placing.

EQUITY FUND RAISING ACTIVITIES DURING THE PAST TWELVE MONTHS

The following table summarises the equity fund raising activities of the Company in the last 12 months immediately before the date of this announcement:

				Actual use of proceeds as
Date of		Net Proceeds		at the date of this
announcement	Event	(Approximately)	Intended proceeds	announcement
7 September 2010	Extension of option	Estimated to be a	general working	As at the date of this
	period from 12 months	maximum of	capital of the	announcement, no
	to 24 months pursuant	HK$128	Group	option has been
	to the supplemental	million, if the		exercised and
	agreement dated 6	options are fully		therefore no proceeds
	September 2010	exercised.		have been raised
7 December 2010	Subscription of Shares	Estimated to be	general working	Used as intended
	under specific mandate	approximately	capital of the
	pursuant to the	HK$100	Group
	subscription	million.
	agreement dated 6
	December 2010
8 December 2010	Placing of a maximum	Estimated to be	general working	Used as intended
	of 280,534,000 Shares	approximately	capital of the
	pursuant to the	HK$90 million.	Group
	placing agreement
	dated 8 December
	2010

Save as disclosed above, there has not been any other equity fund raising activity in the last 12 months immediately before the date of this announcement.

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(II) PROPOSED CHANGE OF NAME OF THE COMPANY

The Board proposes to change the name of the Company from ‘‘China Fortune Group Limited 中國富強集團有限公司’’ to ‘‘China Fortune Financial Group Limited 中國富強金 融集團有限公司’’ (‘‘Proposed Change of Company Name’’).

CONDITIONS FOR THE CHANGE OF COMPANY NAME

The Proposed Change of Company Name is subject to the following conditions:

• (i) the passing of a special resolution by the Shareholders at the forthcoming EGM approving the Proposed Change of Company Name; and

• (ii) the Registrar of Companies in the Cayman Islands granting approval for the Proposed Change of Company Name.

The new name of the Company will take effect from the date on which the Registrar of Companies in the Cayman Islands enters the new name of the Company on the register in place of the existing name. The Registrar of Companies in the Cayman Islands shall issue the certificate of incorporation on change of name thereafter. The Company will then carry out all necessary filing procedures with the Companies Registry in Hong Kong.

REASON FOR THE CHANGE OF COMPANY NAME

The Board is of the view that the new name will better reflect the nature and business development of the Company. This change will not affect the Company’s existing business. The Board believes that the Proposed Change of Company Name is in the interests of the Company and its Shareholders as a whole.

EFFECT OF CHANGE OF COMPANY NAME

The Proposed Change of Company Name will not affect any of the rights of the holders of securities of the Company. All existing share certificates of the Company in issue bearing the existing name of the Company will, after the Proposed Change of Company Name becoming effective, continue to be evidence of title to such securities and will remain to be valid for trading, settlement, registration and delivery purposes. Accordingly, there will not be any arrangement for free exchange of the existing share certificates for new share certificates bearing the new name of the Company.

Upon the Proposed Change of Company Name becoming effective, new share certificates of the Company will be issued under the new name. The English and the Chinese stock short names of the Company will also be changed.

GENERAL

Application will be made by the Company to the Listing Committee of the Stock Exchange for the grant of approval for the listing of, and permission to deal in, the Placing Shares.

The EGM will be convened and held for the Shareholders to consider and, if thought fit, pass the relevant resolution(s) to approve (i) the Placing Agreement and the transactions contemplated thereunder and the Specific Mandate and (ii) the Proposed Change of Company Name.

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A circular containing, among others, (i) further details of the Placing Agreement and the transactions contemplated thereunder and the Specific Mandate; (ii) details of the Proposed Change of Company Name and (iii) a notice convening the EGM will be despatched to the Shareholders as soon as practicable in accordance with the requirements of the Listing Rules.

Completion of the Placing is subject to the satisfaction of the conditions precedent in the Placing Agreement. As the Placing Agreement may or may not proceed. Shareholders and potential investors are advised to exercise caution when dealing in Shares.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions shall have the following meanings when used herein:

• ‘‘Board’’ the board of Directors ‘‘Business Day’’ any day (other than a Saturday, Sunday or public holiday) on which banks are generally open for business in Hong Kong

• ‘‘Company’’ China Fortune Group Limited, a company incorporated in the Cayman Islands with limited liability and the issued Shares of which are listed on the Stock Exchange

• ‘‘Completion Date’’ on or before the seventh Business Day after (i) the satisfaction of all the conditions precedent of the Placing Agreement and (ii) the conclusion of the list of Placees on the Subscription Date (whichever is later), or such later date as may be agreed by and between the Company and the Placing Agent

• ‘‘Director(s)’’ the director(s) of the Company ‘‘EGM’’ the extraordinary general meeting of the Company to be convened to consider and, if thought fit, to approve, inter alia, (i) the Placing Agreement and the transactions contemplated thereunder and the Specific Mandate and (ii) the Proposed Change of Company Name

• ‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the PRC ‘‘Group’’ the Company and its subsidiaries ‘‘Listing Committee’’ having the meaning ascribed thereto in the Listing Rules ‘‘Listing Rules’’ The Rules Governing the Listing of Securities on the Stock Exchange ‘‘Placees’’ the professional, institutional and other investor(s) selected and procured by or on behalf of the Placing Agent to subscribe for any of the Placing Shares on the terms and subject to the conditions set out in the Placing Agreement

• ‘‘Placing’’ the placing of the Placing Shares pursuant to the terms of the Placing Agreement

• ‘‘Placing Agent’’ Fortune (HK) Securities Limited, a licensed corporation to carry on Type 1 (Dealing in securities) regulated activity under the SFO

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• ‘‘Placing Agreement’’ the placing agreement dated 12 May 2011 entered into by and between the Company and the Placing Agent in relation to the Placing

• ‘‘Placing Period’’ the period from the execution of the Placing Agreement up to and including the sixtieth Business Day after the execution of the Placing Agreement

• ‘‘Placing Price’’ HK$0.33 per Placing Share

• ‘‘Placing Share(s)’’ all (but not some) of the 150,000,000 Shares to be placed under the Placing

• ‘‘PRC’’ the People’s Republic of China

• ‘‘SFO’’ the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

• ‘‘Share(s)’’ ordinary share(s) of HK$0.1 each in the share capital of the Company

• ‘‘Shareholder(s)’’ shareholder(s) of the Company

• ‘‘Specific Mandate’’ a specific mandate to be sought from the Shareholders at the EGM to allot and issue the Placing Shares pursuant to the Placing Agreement

• ‘‘Stock Exchange’’ the Stock Exchange of Hong Kong Limited

• ‘‘Subscription Date’’ the date that the Placing Agent concluded the list of Placees with the information of Placees and the number of Placing Shares

• ‘‘HK$’’ Hong Kong dollar(s), the lawful currency of Hong Kong ‘‘%’’ per cent.

By Order of the Board China Fortune Group Limited Ng Cheuk Fan, Keith Managing Director

Hong Kong, 12 May 2011

As at the date of this announcement, the Board consists of five Executive Directors; namely, Mr. Zhang Min (Chairman), Mr. Ng Cheuk Fan, Keith (Managing Director), Mr. Xia Yingyan, Mr. Yeung Kwok Leung and Mr. Hon Chun Yu; one Non-Executive Director, Mr. Wong Kam Fat, Tony (Vice-Chairman) and three Independent Non-Executive Directors; namely, Mr. Tam B Ray Billy, Mr. Ng Kay Kwok and Mr. Lam Ka Wai, Graham.

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