Television Broadcasts Limited — Proxy Solicitation & Information Statement 2003

Jul 25, 2003

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular, 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 Hong Tong Holdings Limited, you should at once hand this circular and the accompanying Annual Report and form of proxy to the purchaser or the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

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

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HONG TONG HOLDINGS LIMITED 泓通控股有限公司

(Formerly known as Yew Sang Hong (Holdings) Limited 耀生行（集團）有限公司 *) (Incorporated in the Cayman Islands with limited liability)

GENERAL MANDATES FOR ISSUE OF NEW SHARES AND REPURCHASE BY THE COMPANY OF ITS OWN SHARES

A notice convening an annual general meeting (the “AGM”) of Hong Tong Holdings Limited (the “Company”) to be held at Unit 3616, 36/F, China Merchants Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong on Friday, 29th August, 2003 at 11:00 a.m. is set out in the Annual Report of the Company for the year ended 31st March, 2003 (the “Annual Report”). Whether or not you are able to attend the AGM, please complete and return the form of proxy accompanying the Annual Report in accordance with the instructions printed thereon to the principal place of business of the Company at Unit 3616, 36/F., China Merchants Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the AGM. Completion and return of the form of proxy shall not preclude you from attending and voting at the meeting should you so desire.

* for identification only

18th July, 2003

LETTER FROM THE CHAIRMAN

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HONG TONG HOLDINGS LIMITED 泓通控股有限公司

(Formerly known as Yew Sang Hong (Holdings) Limited 耀生行（集團）有限公司 *) (Incorporated in the Cayman Islands with limited liability)

Executive Directors: Mr. Hon Ming Kong (Chairman) Mr. Hon Yik Kwong Mr. Lee Yu Leung

Independent Non-executive Directors:

Mr. Lam Kwok Cheong Mr. Fork Siu Lun, Tommy

Registered office: P.O. Box 309 Ugland House South Church Street George Town Grand Cayman Cayman Islands British West Indies

Head office and principal place of business in Hong Kong Unit 3616, 36/F China Merchants Tower Shun Tak Centre 168-200 Connaught Road Central Sheung Wan Hong Kong

18th July, 2003

To the shareholders of the Hong Tong Holdings Limited

Dear Sir or Madam,

GENERAL MANDATES FOR ISSUE OF NEW SHARES AND REPURCHASE BY THE COMPANY OF ITS OWN SHARES

INTRODUCTION

At the AGM to be held at Unit 3616, 36/F., China Merchants Tower, Shun Tak Centre, 168200 Connaught Road Central, Sheung Wan, Hong Kong on Friday, 29th August, 2003 at 11:00 a.m., the notice of which is set out in the Annual Report, ordinary resolutions shall be proposed:

(a) to grant a repurchase mandate to the directors of the Company (the “Directors”) to enable them to exercise the powers of the Company to repurchase shares of HK$0.10

* for identification only

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LETTER FROM THE CHAIRMAN

each in the capital of the Company (the “Shares”) which are fully paid up with an aggregate amount not exceeding 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing of such resolutions (the “Repurchase Mandate”); and

• (b) to grant a general and unconditional mandate to the Directors to enable them to exercise the powers of the Company to allot, issue and otherwise deal with additional Shares up to a maximum of 20 per cent. of the aggregate nominal share capital of the Company in issue as at the date of passing of such resolution (the “Share Issue Mandate”).

In addition, conditional upon the granting of the Repurchase Mandate, an ordinary resolution will be proposed to increase the number of Shares to be allotted and issued under the Share Issue Mandate by an additional number representing such number of Shares repurchased under the Repurchase Mandate.

Under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) (the “Listing Rules”), the Company is required to send to its shareholders all information which is reasonably necessary to enable shareholders to make an informed decision as to whether to vote for or against the resolution to renew the granting of the Repurchase Mandate and the Share Issue Mandate to the Directors. This circular is prepared for such purpose and to give you further details so as to enable you to make an informed decision on whether to vote for or against the resolutions to be proposed at the AGM in relation to the Repurchase Mandate and the Share Issue Mandate. An explanatory statement as required under the Listing Rules to provide the requisite information concerning the Repurchase Mandate is set out in the appendix hereto.

THE REPURCHASE MANDATE

The existing general mandate to repurchase Shares granted to the Directors at the annual general meeting held on 23rd August, 2002 will expire upon the conclusion of the AGM.

At the AGM, an ordinary resolution will be proposed in respect of granting the Repurchase Mandate to the Directors.

The Repurchase Mandate will, if granted, remain in effect until the earliest 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 any applicable laws of the Cayman Islands or by the articles of association of the Company (the “Articles of Association”); and (iii) its revocation or variation by an ordinary resolution of the shareholders of the Company (the “Shareholders”) in general meeting.

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LETTER FROM THE CHAIRMAN

THE SHARE ISSUE MANDATE

The existing general mandate to issue Shares granted to the Directors at the annual general meeting held on 23rd August, 2002 will expire upon the conclusion of the AGM.

At the AGM, an ordinary resolution will be proposed to grant the Share Issue Mandate to the Directors in order to increase the flexibility for raising capital to facilitate expansion plan of the Company as the Directors consider appropriate.

The Share Issue Mandate will, if granted, remain effective until the earliest of (i) the conclusion of the next annual general meeting of the Company; (ii) the expiration of the period within the next annual general meeting of the Company is required by any applicable laws of the Cayman Islands or by the Articles of Association; and (iii) its revocation or variation by an ordinary resolution of the shareholders in general meeting.

In addition, if the Repurchase Mandate is granted, an ordinary resolution will be proposed at the AGM providing that any Shares repurchased under the Repurchase Mandate (up to maximum of 10 per cent. of the issued shares as at the date of the granting of the Share Issue Mandate) will be added to the total number of Shares which may be allotted and issued under the Share Issue Mandate.

The Directors have no immediate plans to issue any new Shares other than Shares which may fall to be issued under the share option scheme of the Company or any scrip dividend scheme which may be approved by the shareholders of the Company.

ACTION TO BE TAKEN

Whether or not you are able to attend the AGM, you are requested to complete and return the form of proxy accompanying the Annual Report in accordance with the instructions printed thereon not less than 48 hours before the time appointed for holding the AGM. The return of the form of proxy will not preclude you from attending and voting at the AGM should you so desire.

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LETTER FROM THE CHAIRMAN

RECOMMENDATION

The Directors believe that the Repurchase Mandate and the Share Issue Mandate are in the best interests of the Company and its shareholders as a whole.

Accordingly, the Directors recommend that you should vote in favour of the ordinary resolutions numbers 4(A) to 4(C) to be proposed at the AGM.

Yours faithfully

For and on behalf of the Board of Directors of

Hong Tong Holdings Limited Hon Ming Kong

Chairman

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EXPLANATORY STATEMENT

APPENDIX

This Appendix serves as an explanatory statement, as required by the Listing Rules, to provide requisite information to the Shareholders for their consideration of the Repurchase Mandate.

1. SHARE CAPITAL

As at 18th July, 2003, being the latest practicable date prior to the printing of this circular (the “Latest Practicable Date”), the issued share capital of the Company comprised 223,800,000 Shares.

Subject to the passing of the proposed resolution for the approval of the Repurchase Mandate and on the basis that no Shares are issued or repurchased by the Company prior to the AGM, the Company would be allowed under the Repurchase Mandate to repurchase a maximum of 22,380,000 Shares.

2. REASONS FOR THE REPURCHASE

The Directors believe that the Repurchase Mandate is in the best interests of the Company and the Shareholders. An exercise of the Repurchase Mandate may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the value of the net assets of the Company and/or its earnings per share and will only be made if the Directors believe that such a repurchase will benefit the Company and its shareholders.

3. FUNDING OF REPURCHASE

Repurchase of Shares will be funded entirely from the Company’s legally available cash flow or working capital facilities.

An exercise of the Repurchase Mandate in full could have a material adverse impact on the working capital and gearing position of the Company as compared with the position disclosed in the audited financial statements contained in the Annual Report. However, the Directors do not intend to make any repurchase in circumstances that would have any material adverse impact on the working capital or gearing position of the Company which in the opinion of the Directors are from time to time appropriate for the Company or would reduce the public float to below 25 per cent.

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EXPLANATORY STATEMENT

APPENDIX

4. SHARE PRICES

The highest and lowest traded prices at which Shares have traded on the Stock Exchange during each of the previous 12 months before the Latest Practicable Date were as follows:

Month	Highest	Lowest
	(HK$)	(HK$)
2002
July	9.200	5.500
August	9.000	4.850
September	8.650	6.450
October	6.800	4.950
November	5.850	2.850
December	3.325	3.000
2003
January	2.975	2.100
February	2.575	1.700
March	2.550	2.350
April	2.200	1.850
May	1.850	1.500
June	1.600	1.320

5. UNDERTAKING

None of the Directors, to the best of their knowledge, having made all reasonable enquiries, nor any of their associates (as defined in the Listing Rules), has any present intention to sell to the Company or its subsidiaries any Shares under the Repurchase Mandate if such is approved by the Shareholders.

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the powers of the Company to make repurchases pursuant to the Repurchase Mandate in accordance with the Listing Rules and the applicable laws of the Cayman Islands.

No connected persons (as defined in the Listing Rules) have notified the Company that they have a present intention to sell any Shares to the Company, or have undertaken not to do so, in the event that the Repurchase Mandate is approved by the Shareholders.

6. HONG KONG CODES ON TAKEOVERS AND MERGERS AND SHARE REPURCHASES

If a shareholder’s proportionate interest in the voting rights of the Company increases on the Company exercising its powers to repurchase Shares pursuant to the Repurchase Mandate, such increase will be treated as an acquisition for the purposes of Rule 32 of

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EXPLANATORY STATEMENT

APPENDIX

the Hong Kong Code of Takeovers and Mergers (the “Takeovers Code”). As a result, a shareholder or group of shareholders acting in concert could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code.

As at the Latest Practicable Date, and according to the register kept by the Company pursuant to Part XV of the Securities and Futures Ordinance (Cap. 571), the substantial shareholders of the Company as follows:

		Percentage of
	Number of Shares	shareholding
Highworth Venture Limited_(Note 1)_	54,900,000	24.5%
YSH Investments Limited_(Note 2)_	58,916,000	26.3%
AWH Fund Limited_(Note 3)_	27,366,000	12.2%

Notes:

1. Highworth Venture Limited is a company beneficially owned by Mr. Hon Ming Kong, Chairman of the Company.

2. Based on the information provided by the Stock Exchange on 28th November, 2002.

3. Based on the information provided by the Stock Exchange on 30th August, 2002.

Except disclosed aforesaid, to the best of the knowledge and belief of the Company, no other person, together with his/her associates, was beneficially interested in the Shares representing 5 per cent. or more of the issued share capital of the Company.

In the event that the Directors exercise in full the power to repurchase shares which is proposed to be granted pursuant to the Ordinary Resolution No 4(A), then (if the present shareholdings otherwise remained the same) the attributable shareholding of (1) Highworth Venture Limited and parties acting in concert with it would be increased to approximately 27.256 per cent. of the issued share capital of the Company; (2) YSH Investment Limited and parties acting in concert with it would be increased to approximately 29.250 per cent. of the issued share capital of the Company; and (3) AWH Fund Limited and parties acting in concert with it would be increased to approximately 13.587 per cent. of the issued share capital of the Company and such increases would not give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code.

7. SHARE REPURCHASE MADE BY THE COMPANY

The Company has not purchased any of its Shares (whether on the Stock Exchange or otherwise) during the previous six months preceding the Latest Practicable Date.

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