Television Broadcasts Limited — M&A Activity 2008

Dec 9, 2008

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(Incorporated in the Cayman Islands with limited liability)

Already renamed as “China Fortune Group Limited” and the Chinese name as “中國富強集團有限公司”

(The Certificate of Incorporation on Change of Company Name was issued by

the Registry of Companies, Cayman Islands but pending registration

with the Companies Registry in Hong Kong under Part XI of the Companies Ordinance)

(Stock Code: 0290)

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

MEMORANDUM OF UNDERSTANDING

Financial adviser to the Company

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The Board is pleased to announce that on 9 December 2008, the Purchaser entered into the Memorandum with the Vendor, under which, the Purchaser agreed to purchase and the Vendor agreed to sell not less than 20% of the issued share capital of the Target Company as may be agreed between the Vendor and the Purchaser by good faith negotiation, subject to the entering into of the Formal Agreement between the Purchaser (or its nominee) and the Vendor. A refundable deposit of RMB3 million (equivalent to approximately HK$3.38 million) will be paid by the Purchaser to the Vendor within three business days upon signing of the Memorandum.

The Company will comply with the applicable provisions of the Listing Rules in relation to the Acquisition should it materialized. This announcement is made pursuant to Rule 13.09 of the Listing Rules. Further announcement(s) will be made by the Company in respect of the development of the Acquisition as and when required by the Listing Rules.

The Board wishes to emphasize that no legally binding agreement in relation to the Acquisition has been entered into as at the date of this announcement. As the Acquisition may or may not be entered into, Shareholders and investors are urged to exercise caution when dealing in the Shares.

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Trading in the Shares on the Stock Exchange was suspended at the request of the Company from 9:30 a.m. on 29 September 2005 and will remain suspended until further notice.

THE MEMORANDUM

On 9 December 2008, the Purchaser entered into the Memorandum with the Vendor, under which, the Purchaser agreed to purchase and the Vendor agreed to sell not less than 20% of the issued share capital of the Target Company as may be agreed between the Vendor and the Purchaser by good faith negotiation, subject to the entering into of the Formal Agreement between the Purchaser (or its nominee) and the Vendor. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiry, the Vendor and its ultimate beneficial owners are third parties independent of the Company and its connected persons.

The Memorandum is not intended to be legally binding between the parties in relation to the Acquisition. The final terms of the Formal Agreement (which is expected to be entered into by no later than 6 months from the date of the Memorandum) have yet to be negotiated and finalized.

The Board wishes to emphasize that no legally binding agreement in relation to the Acquisition has been entered into as at the date of this announcement. As the Acquisition may or may not be entered into, Shareholders and investors are urged to exercise caution when dealing in the Shares.

This announcement is made pursuant to Rule 13.09 of the Listing Rules. The Company will comply with the applicable provisions of the Listing Rules in relation to the Acquisition should it materialized. Further announcement(s) will be made by the Company in respect of the development of the Acquisition as and when required by the Listing Rules.

Consideration

Under the Memorandum, the consideration for the Acquisition will be determined by good faith negotiation between the Vendor and the Purchaser on the basis of not more than RMB1.5 million (equivalent to approximately HK$1.69 million) for every 1% of the issued share capital of the Target Company. On the assumption that the price for each percentage of interest in the Target Company would be RMB1.5 million (equivalent to approximately HK$1.69 million), the consideration of the Acquisition would range from RMB30 million (equivalent to approximately HK$33.81 million) to RMB73.5 million (equivalent to

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approximately HK$82.84 million) given the amount of interest in the Target Company to be acquired by the Purchaser would range from 20% to 49%. The consideration may be satisfied by the Purchaser in cash or by procuring allotment and issue of new shares of, or to issue convertible bonds carrying rights to convert into new shares of, or to issue promissory notes of the Company or a combination of any of the above.

A deposit of RMB3 million (equivalent to approximately HK$3.38 million) will be paid by the Purchaser to the Vendor within three business days upon signing of the Memorandum. If the Formal Agreement is entered into between the Purchaser (or its nominee) and the Vendor, such deposit will be used to set off part of the consideration. The deposit will be fully refundable to the Purchaser if (1) the Purchaser (regardless of any reasons) is unsatisfied with the results of the due diligence review to be conducted on the Target Company; (2) the Formal Agreement is not entered into within 6 months from the date of the Memorandum for reasons not because of the Purchaser; and/or (3) the Vendor cannot effect the cash injection as described in the paragraph headed “Reasons for the Acquisition” within 6 months from the date of the Memorandum.

Reasons for the Acquisition

The Group is principally engaged in securities brokerage and margin financing; electrical engineering contracting; and sale of electrical goods.

The Target Company was established in the PRC in 1995 and provides brokerage services for dealing in futures contracts in the PRC. The registered capital of the Target Company is RMB30 million (equivalent to approximately HK$33.81 million) as at the date of the Memorandum and the Vendor will inject RMB28.82 million (equivalent to approximately HK$32.48 million) into the Target Company to become being interested in the Target Company as to 49%.

By entering into of the Memorandum, the Company can extend the scope of its securities business to futures brokerage services in the PRC to prepare itself as a full range financial services company. The Acquisition is in line with one of the existing principal business of the Group, being securities brokerage and financing business. The Directors believe that the expanded scope of business of the Group into the futures brokerage business in the PRC would provide an extra income source to the Group. The Directors consider that the Acquisition is an appropriate strategic expansion and beneficial to the Group.

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The Directors considered that the proposed acquisition of not less than 20% of the issued share capital of the Target Company pursuant to the Memorandum could maintain the strategic partnership with the other shareholders of the Target Company, which have the management experience in the futures brokerage services in the PRC and thus is in the interests of the Shareholders and the Company as a whole.

The Directors consider that the terms of the non legally binding Memorandum are fair and reasonable and on normal commercial terms and that the Acquisition is in the interests of Company and the Shareholders as a whole.

Conditions Precedent and Completion

Completion of the Acquisition will be conditional on, among other things:

1. the completion of cash injection by the Vendor so that it will be interested in as to 49% of the Target Company;

2. the Purchaser being satisfied with the results of the due diligence review to be conducted by the Purchaser and/or its advisers on the Target Company and the Vendor agrees to provide full cooperation and assistance to the Purchaser and/or its advisers in conducting the due diligence review;

3. other shareholders of the Target Company have irrevocably and unconditionally given up their respective pre-emptive rights in acquiring the shares of the Target Company;

4. shareholders of the Target Company have approved the transfer of the shares of the Target Company by the Vendor to the Purchaser (or its nominees);

5. if required, the Shareholders passing at the extraordinary general meeting of the Company an ordinary resolution approving the Acquisition and the transactions contemplated thereunder;

6. the Target Company obtaining all necessary consents, confirmations, permits, approvals, licences and authorisations having been obtained from all relevant governmental regulatories (including but not limited to the China Securities Regulatory Commission); and

7. other usual and customary closing conditions for a transaction of this nature.

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The Memorandum does not constitute legally-binding commitment on the part of the Company in respect of the Acquisition. The Acquisition will be subject to the execution and completion of the Formal Agreement.

SUSPENSION OF TRADING

Trading in the Shares was suspended with effect from 9:30 a.m. on 29 September 2005 at the request of the Company and will continue to be suspended until further notice.

DEFINITIONS

Terms or expressions used in this announcement shall, unless the context otherwise requires, have the meanings ascribed to them below:

“Acquisition” the proposed acquisition of not less than 20% of the issued share capital of the Target Company by the Purchaser pursuant to the Memorandum “Board” the board of Directors “Company” China Conservational Power Holdings Limited (already renamed as “China Fortune Group Limited” since the Certificate of Incorporation on Change of Company Name was issued by the Registry of Companies, Cayman Islands but pending registration of the new name with the Companies Registry in Hong Kong under Part XI of the Companies Ordinance), a company incorporated in the Cayman Islands with limited liability and the Shares of which are listed on the Stock Exchange

“Directors” the directors of the Company “Formal Agreement” a formal agreement setting out, amongst others, the terms set out in the Memorandum in respect of the Acquisition “Group” the Company and its subsidiaries “Hong Kong” The Hong Kong Special Administrative Region of the PRC

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“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“Memorandum”	a non-legally binding memorandum entered into between the
	Purchaser and the Vendor on 9 December 2008
“Purchaser”	Fortune Financial (Holdings) Limited, a company incorporated
	in British Virgin Islands and a wholly-owned subsidiary of the
	Company
“PRC”	People’s Republic of China which, for the purpose of this
	announcement, excludes Hong Kong, the Macau Special
	Administrative Region of the PRC and Taiwan
“Share(s)”	share(s) of HK$0.10 each in the capital of the Company
“Shareholder(s)”	holder(s) of the Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Target Company”	a company established in the PRC engaged in the brokerage
	services for dealing in futures contracts in the PRC
“Vendor”	深圳市華德石油化工有限公司( #S h e n z h e n H u a d e
	Petrochemical Company Limited), a company established in the
	PRC
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“%”	per cent.

For the purpose of this announcement, unless otherwise indicated, conversions of RMB into HK$ is calculated at the approximate exchange rate of RMB0.8873 to HK$1.00. This exchange rate is adopted for the purpose of illustration only and does not constitute a representation that any amounts have been, could have been, or may be, exchanged at this or any other rate at all.

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• the English translation of the Chinese name is for information purpose only and should not be regarded as the official English translation of such Chinese name.

By Order of the Board of Directors of China Conservational Power Holdings Limited Ng Cheuk Fan, Keith Managing Director

Hong Kong, 9 December 2008

As at the date of this announcement, the Board consists of three Executive Directors, namely Mr. Sun Tak Yan, Desmond (Chairman), Mr. Ng Cheuk Fan, Keith (Managing Director) and Mr. Yeung Kwok Leung; 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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