Wai Kee Holdings Limited

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Wai Kee Holdings Limited, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser(s) or transferee(s) or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

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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(Incorporated in Bermuda with limited liability) (Stock code: 610)

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

Financial adviser to Wai Kee Holdings Limited

Independent financial adviser to the Independent Board Committee and the Independent Shareholders

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A letter from the Independent Board Committee containing its recommendation is set out on page 13 of this circular. A letter from Access Capital containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 14 to 26 of this circular.

A notice convening the Special General Meeting to be held at Unit 702B, 7th Floor, East Ocean Centre, 98 Granville Road, Tsimshatsui, Kowloon, Hong Kong on Monday, 21 June 2004 at 1:30 p.m. is set out on pages 35 to 36 of this circular. A form of proxy for use in the Special General Meeting is enclosed. Whether or not you intend to attend the Special General Meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as possible, and in any event not less than 48 hours before the time appointed for the holding of the Special General Meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the Special General Meeting or any adjournment thereof should you so desire.

4 June 2004

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
The Wai Kee Connected Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Reasons for the Wai Kee Connected Transactions . . . . . . . . . . . . . . . . . . . . . . . . . .	7
The Proposed Caps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Procedures for demanding a poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Letter from Access Capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Appendix — General information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	27
Notice of Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	35

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DEFINITIONS

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

“Access Capital” Access Capital Limited, a corporation deemed licensed under the SFO to perform types 1, 4, 6 and 9 of the regulated activities (as defined in the SFO) and the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Agreement and Proposed Caps;

“Agreement” the master agreement entered into between I-China and the Company on 19 May 2004 in relation to the Wai Kee Connected Transactions;
“associate(s)” has the meaning ascribed thereto under the Listing Rules; “Board” the board of the Wai Kee Directors; “Company” Wai Kee Holdings Limited, a company incorporated in Bermuda with limited liability and the securities of which are listed on the Main Board of the Stock Exchange;
“Completion” completion of the Restructuring Agreement which took place on 23 April 2004;
“Corporate Guarantees” the indemnities and guarantees for construction contracts and the guarantees for banking facilities provided by the Wai Kee Group in favour of third parties in respect of the obligations of members of the Top Tactic Group under such contracts and facilities;
“I-China” I-China Holdings Limited, a company incorporated in Bermuda with limited liability and the securities of which are listed on the Main Board of the Stock Exchange and a non wholly-owned subsidiary of the Company;
“I-China Group” I-China and its subsidiaries (including the Top Tactic Group);
“I-China Restructuring” the restructuring of I-China under the Restructuring Agreement as detailed in the Joint Announcement;
“I-China Shares” ordinary shares of HK$0.01 each in the issued share capital of I-China;

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DEFINITIONS

“Independent Board Committee” an independent board committee of the Company comprising Messrs. Wong Che Ming, Steve and Wan Siu Kau, Samuel for the purpose of considering and advising the Independent Shareholders in respect of the Agreement and the Proposed Caps;
“Independent Shareholders” Shareholders who are entitled to vote at the Special General Meeting other than Mr. William Zen and Mr. Derek Zen and their respective associates;
“Joint Announcement” the joint announcement of the Company and I-China dated 18 December 2003 in relation to the I-China Restructuring;
“Latest Practicable Date” 2 June 2004, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained in this circular;
“Listing Rules” The Rules Governing the Listing of Securities on the Stock Exchange;
“Mr. Derek Zen” Mr. Zen Wei Peu, Derek, the Vice Chairman of the Board;
“Mr. William Zen” Mr. Zen Wei Pao, William, the Chairman of the Board; “Proposed Cap(s)” the proposed cap(s) in respect of each of the Wai Kee Connected Transactions over the three financial years ending 31 December 2006 as set out in the paragraph headed “The Proposed Caps” under the section headed “Letter from the Board” in this circular;
“Restructuring Agreement” the agreement dated 20 November 2003, as amended by a supplemental agreement dated 17 March 2004, entered into between I-China, the then provisional liquidators of I-China, the Company and an escrow agent, in relation to the I-China Restructuring;
“Restructuring Document” the document to the shareholders of I-China dated 24 February 2004 issued by I-China and the Company regarding the Restructuring Agreement;
“SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong);

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DEFINITIONS

“Share(s)”	ordinary share(s) of HK$0.10 each in the share capital
	of the Company;
“Shareholder(s)”	holders of the Share(s);
“Special General Meeting”	the special general meeting of the Company to be held
	for the purpose of, among other things, passing the
	relevant resolutions with respect to the Agreement and
	the Proposed Cap(s);
“Staff Share Purchasing	300 million I-China Shares, in aggregate, to be transferred
Scheme Shares”	to Mr. William Zen and Mr. Derek Zen pursuant to the
	staff share purchasing scheme of the Company as
	announced on 15 and 24 March 2004;

“Stock Exchange” The Stock Exchange of Hong Kong Limited; “Top Tactic” Top Tactic Holdings Limited, a company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of I-China;
“Top Tactic Group” Top Tactic and its subsidiaries; “Wai Kee Connected Transactions” the connected transactions set out in the paragraph headed “The Wai Kee Connected Transactions” under the section headed “Letter from the Board” of this circular;
“Wai Kee Directors” the directors of the Company; “Wai Kee Group” Wai Kee and its subsidiaries (which expression shall exclude the I-China Group except where references are made to Wai Kee and its subsidiaries prior to Completion); and
“HK$” Hong Kong dollar(s), the lawful currency of the Hong Kong Special Administrative Region of the People’s Republic of China.

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LETTER FROM THE BOARD

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WAI KEE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 610)

Executive directors: Zen Wei Pao, William (Chairman) Zen Wei Peu, Derek (Vice Chairman) Fong Shiu Leung, Keter

Non-executive directors: Lam Wai Hon, Patrick Cheng Chi Pang, Leslie

Independent non-executive directors: Wong Che Ming, Steve Wan Siu Kau, Samuel

Registered office: Clarendon House Church Street Hamilton HM 11 Bermuda

Principal place of business in Hong Kong: Unit 702B, 7th Floor East Ocean Centre 98 Granville Road Tsimshatsui Kowloon Hong Kong

4 June 2004

To the Shareholders

Dear Sir or Madam,

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

The Board announced on 19 May 2004 that the Company and I-China had entered into the Agreement pursuant to which the Wai Kee Group agreed to provide the Corporate Guarantees in favour of third parties in respect of the obligation of members of the Top Tactic Group, which are all subsidiaries of I-China, from 23 April 2004, being the date on which Completion took place, to 31 December 2006 (both days inclusive).

Upon the transfer of the Staff Share Purchasing Scheme Shares, the Wai Kee Connected Transactions will constitute non-exempt continuing connected transactions for the Company under the Listing Rules and will therefore be subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules.

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LETTER FROM THE BOARD

The purpose of this circular is to provide you with further information regarding the Agreement and the Proposed Caps and to give you notice of the Special General Meeting at which a resolution will be proposed to seek your approval of the Agreement and the Proposed Caps. Vast Earn Group Limited, a substantial Shareholder who holds over 50% of the voting rights amongst the Independent Shareholders, has undertaken to the Company to vote in favour of the resolution to be proposed at the Special General Meeting.

THE WAI KEE CONNECTED TRANSACTIONS

Background

Completion took place on 23 April 2004 and I-China is now approximately 67.4% owned by the Company. Therefore, the Company is a connected person of I-China under the Listing Rules.

Prior to Completion, the Wai Kee Group had provided Corporate Guarantees in favour of third parties in respect of the obligations of members of the Top Tactic Group (which were, prior to Completion, wholly-owned subsidiaries of the Company) pursuant to various construction contracts for a total amount of approximately HK$2,447 million, representing approximately 92.7% of the audited total assets of the Wai Kee Group as at 31 December 2003, bond sum for a total sum of approximately HK$196 million, representing approximately 7.4% of the audited total assets of the Wai Kee Group as at 31 December 2003, and banking facilities of loans and overdrafts for a total sum of HK$45 million, representing approximately 1.7% of the audited total assets of the Wai Kee Group as at 31 December 2003.

For the two years ended 31 March 2002, the nine months ended 31 December 2002 and the year ended 31 December 2003, the Wai Kee Group had provided guarantees for construction contracts with an aggregate contract sum of approximately HK$2,171 million, HK$2,145 million, HK$2,294 million and HK$2,447 million, respectively.

For the two years ended 31 March 2002, the nine months ended 31 December 2002 and the year ended 31 December 2003, the Wai Kee Group had provided guarantees for performance and/or tender bonds of approximately HK$321 million, HK$315 million, HK$345 million and HK$258 million, respectively.

For the two years ended 31 March 2002, the nine months ended 31 December 2002 and the year ended 31 December 2003, the Wai Kee Group had provided guarantees for banking facilities of approximately HK$38 million, HK$42 million, HK$40 million and HK$65 million, respectively.

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LETTER FROM THE BOARD

Corporate guarantee fees

In consideration of the provision of the Corporate Guarantees, the Wai Kee Group has been charging the Top Tactic Group monthly corporate guarantee fees based on normal commercial terms and with reference to the prevailing market rates charged by financial institutions in Hong Kong. The market rate for similar guarantees provided by a financial institution in Hong Kong is approximately 1% p. a. of the bond sum which in turn represents 10% of the contract sum in general. The charges on the banking facilities supported by guarantees of the Company are based on the charges/fees levied by commercial banks in Hong Kong.

The corporate guarantee fees have been charged as follows:

0.1% p. a. of the contract sum if the Company issues guarantee, undertaking or indemnity to employers or joint venture partners of projects undertaken by members of the Top Tactic Group;
0.1% p. a. of the bond sum if the Company issues guarantee to financial institution who provides performance and/or tender bonds for the projects undertaken by the Top Tactic Group and no fee has been charged under paragraph 1 above;
0.5% p. a. of the banking facilities supported by a guarantee provided by the Company; and
0.1% p. a. of HK$70,000,000 (being the outstanding amount of the guarantee provided by the Company to the Hong Kong Housing Authority as at the date of this circular).

The policy of charging the corporate guarantee fees by the Wai Kee Group was first implemented in April 2002. For the nine months ended 31 December 2002 and the year ended 31 December 2003, the corporate guarantee fees charged by the Wai Kee Group to the Top Tactic Group amounted to approximately HK$2.1 million and HK$2.7 million, respectively, representing approximately 0.1% and 0.1% of the total Corporate Guarantees for each of the corresponding periods.

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LETTER FROM THE BOARD

The Agreement

Date of agreement: 19 May 2004

Parties:

i. I-China; and
ii. the Company.

Subject:

Pursuant to the Agreement, the Wai Kee Group agreed to provide the Corporate Guarantees in favour of third parties in respect of the obligations of members of the Top Tactic Group, which are all subsidiaries of I-China.

Term:

The Agreement shall be deemed to have commenced on 23 April 2004 (being the date on which Completion took place) and shall continue until 31 December 2006 (both days inclusive). Both parties may renew the Agreement in writing during the three months period prior to the expiry on 31 December 2006, subject to compliance with the Listing Rules.

Guarantee fee amount:

Pursuant to the Agreement, the Wai Kee Connected Transactions will continue to be conducted between the Wai Kee Group and the I-China Group and the Wai Kee Group will charge the Top Tactic Group corporate guarantee fees based on normal commercial terms and on the same terms as adopted before Completion. It is expected that the estimated corporate guarantee fees to be charged by the Wai Kee Group shall not exceed HK$5 million in total for each of the financial years ending 31 December 2006.

REASONS FOR THE WAI KEE CONNECTED TRANSACTIONS

The Wai Kee Group is principally engaged in quarrying, highway and expressway operations and biotechnology businesses in the Greater China region. Prior to Completion, members of the Top Tactic Group were wholly-owned subsidiaries of the Company and engaged in the construction business of the Company. As part of the consideration under the Restructuring Agreement, the Company transferred the Top Tactic Group to I-China and I-China has since become a non wholly-owned subsidiary of the Company. Mr. William Zen and Mr. Derek Zen, both of whom are Wai Kee Directors, were together holding approximately 7.89% of the shareholding interest of I-China as at the Latest Practicable Date. Pursuant to the staff Share purchasing scheme of the Company as announced on 15 and 24 March 2004, the Staff Share Purchasing Scheme Shares, which represent approximately 3.8% of the issued share capital of

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LETTER FROM THE BOARD

I-China as at the Latest Practicable Date, will be transferred to Mr. William Zen and Mr. Derek Zen within 30 days after (i) full payment of the relevant purchase price; or (ii) the expiry of the six-month period after 27 April 2004, being the date on which the I-China Shares resumed trading on the Stock Exchange, subject to the full payment of the relevant purchase price, whichever is the later. Upon the transfer of the Staff Share Purchasing Scheme Shares, Mr. William Zen and Mr. Derek Zen will together hold more than 10% of interests in I-China and I-China will then be considered a connected person of the Company under Chapter 14A of the Listing Rules.

It is a common practice in the construction industry to require the holding company of a contractor (in this case, the Company) to provide unlimited guarantee for the performance of construction contracts in particular, construction contracts for public works which always require unlimited parent company guarantee as one of the conditions to award the construction contracts. The Wai Kee Group has never experienced any claims for losses under the Corporate Guarantees. Furthermore, the Wai Kee Group is not required to provide any security in respect of the Corporate Guarantees in general. However, securities, if required, will be provided by the Top Tactic Group in respect of the guarantee to financial institutions which provide performance and/or tender bonds for projects undertaken by the Top Tactic Group.

The Wai Kee Directors anticipate that it is likely that the Wai Kee Group will be required to provide guarantees for new construction contracts to be entered into by members of the Top Tactic Group initially for a period of three years commencing from 23 April 2004, being the completion date of the Restructuring Agreement.

THE PROPOSED CAPS

As set out in the paragraph headed “Reasons for the Wai Kee Connected Transactions” above, the Wai Kee Connected Transactions will constitute non-exempt continuing connected transactions for the Company under the Listing Rules upon the transfer of the Staff Share Purchasing Scheme Shares and will therefore be subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules. The Company proposes to set caps in respect of each of the Wai Kee Connected Transactions over the three financial years ending 31 December 2006 with reference to the historical guarantee, undertaking or indemnity provided by the Wai Kee Group to members of the Top Tactic Group as follows:

A. Proposed Cap in respect of the guarantee, undertaking or indemnity providing for the liabilities of members of the Top Tactic Group to independent employers of or partners in projects undertaken by members of the Top Tactic Group

For the two years ended 31 December 2003, the Wai Kee Group had provided corporate guarantees for projects with aggregate contract sum of approximately HK$5.7 billion and HK$6.4 billion respectively, comprising (i) corporate guarantees in favour of independent employers of or partners in projects for projects with aggregate contract

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LETTER FROM THE BOARD

sum of approximately HK$2.2 billion and HK$2.4 billion respectively undertaken by members of the Top Tactic Group and (ii) corporate guarantees in favour of independent employers of and/or partners in projects for projects with aggregate contract sum of approximately HK$3.5 billion and HK$4 billion respectively undertaken by project companies, in which members of the Top Tactic Group are interested in less than 50% share.

It has been a practice for construction companies to form a specific-purpose project company to jointly tender for a particular project, especially for a large scale project. The employer of or the partners in a project company may require the Company, the ultimate holding company of the Top Tactic Group, to provide unlimited guarantee for the performance of such project company. As these guarantees are always joint and several in nature, all partners and their parent companies are jointly liable for the performance of the project company. Under the joint and several guarantees, project partners may claim the Company for losses, and vice versa. As at the Latest Practicable Date, the Wai Kee Group had never experienced any claims for losses under these guarantees.

As the amount of future contracts to be tendered by project companies to be formed by members of the Top Tactic Group and the share of Top Tactic in such project companies cannot be determined with certainty at this stage, the Wai Kee Directors propose that for guarantee, undertaking or indemnity in respect of the liabilities of members of the Top Tactic Group to independent employers of or partners in projects undertaken by members of the Top Tactic Group, there should be no cap on liability provided that the contract sum of each project will not exceed HK$1 billion and the total contract sum of all projects awarded after 23 April 2004, being the completion date of the Restructuring Agreement, will not exceed HK$5 billion, for each of the three financial years ending 31 December 2006.

B. Proposed Cap in respect of the guarantee to financial institutions which provide performance and/or tender bonds for projects undertaken by members of the Top Tactic Group

Approximately 50% of the Wai Kee Group’s construction contracts that were awarded during the three years ended 31 December 2003 required provision of performance bonds and the corresponding bond amount was in the range of 5% to 10% of the contract value. Accordingly, based on the Proposed Cap of HK$5 billion on projects to be tendered by members of the Top Tactic Group or their respective project companies, the Wai Kee Directors propose that, in respect of the guarantee to financial institutions which provide performance and/or tender bonds for projects undertaken by members of the Top Tactic Group, the bond sum issued after 23 April 2004, being the completion date of the Restructuring Agreement, will not exceed a maximum amount of HK$200 million, for each of the three financial years ending 31 December 2006.

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LETTER FROM THE BOARD

C. Proposed Cap in respect of the guarantee in support of banking facilities (loans or over-drafts) extended to members of the Top Tactic Group

Based on (i) the Proposed Cap on the annual total contract sum of HK$5 billion and the average total contract sum of approximately HK$6 billion which required Corporate Guarantees for the two years ended 31 December 2003, and (ii) it is common to take approximately five years to complete the contracts, the annual average turnover to be derived from the contracts is expected to be in the range of approximately HK$1 billion to HK$1.2 billion. Having taken into account the normal payment cycle of approximately 1.5 month, the maximum banking facilities required will be approximately HK$150 million. Excluding the current bank facilities of HK$45 million which have already been guaranteed by the Company, the Wai Kee Directors propose that the guarantee in support of banking facilities (loans and over-drafts) extended to members of the Top Tactic Group will not exceed a maximum amount of liability of HK$100 million, for each of the three financial years ending 31 December 2006.

The Proposed Caps to be proposed at the Special General Meeting will be subjected to the following conditions:

(A) The Wai Kee Connected Transactions will be
(i) entered into in the ordinary and usual course of business of the Wai Kee Group;
(ii) conducted in accordance with the terms of the Agreement and either (A) on normal commercial terms; or (B) if there is no available comparison, on terms that are fair and reasonable so far as the Shareholders, taken as a whole, are concerned; and
(iii) entered into on terms that are no less favourable than terms available to or from independent third parties.
(B) Brief details of the Wai Kee Connected Transactions will be disclosed in the Company’s next and each successive annual report together with a statement of the opinion of the independent non-executive directors of the Company referred to in paragraph (C) below.
(C) The independent non-executive directors of the Company will review the Wai Kee Connected Transactions annually and confirm in the Company’s annual report and accounts for the year in question that such transactions were conducted in the manner as stated in paragraph (A) above.
(D) The auditors of the Company will provide a letter to the Board (a copy of which letter will be provided to the Stock Exchange at least 10 days prior to bulk-printing of the annual report of the Company) confirming that the Wai Kee Connected Transactions:
(i) have been approved by the Board;

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LETTER FROM THE BOARD

(ii) have been entered into in accordance with the terms of the agreements relating to the transactions in question; and
(iii) have not exceeded the Proposed Caps.
(E) In the event that:
(i) the total amount of each of the Wai Kee Connected Transactions has exceeded the Proposed Caps; or
(ii) the Agreement is renewed or there is any material amendment to the terms of the Wai Kee Connected Transactions.

The Company will comply with the applicable provisions of the Listing Rules governing connected transactions or will apply for waiver from strict compliance with the relevant requirements in accordance with the provisions under Rule 14A.42(2) of the Listing Rules.

PROCEDURES FOR DEMANDING A POLL

Pursuant to Bye-law 66 of the Company’s Bye-laws, a resolution put to the vote of a general meeting of the Shareholders 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:

(i) by the chairman of such meeting; or
(ii) by at least three Shareholders present in person or, in the case of a Shareholder being a corporation, by its duly authorised representative or by proxy for the time being entitled to vote at the meeting; or
(iii) by a Shareholder or Shareholders present in person or, in the case of a Shareholder 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 Shareholders having the right to vote at the meeting; or
(iv) by a Shareholder or Shareholders present in person or, in the case of a Shareholder 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.

In accordance with Rule 13.39(4) of the Listing Rules, the Chairman of the Special General Meeting will demand a poll in relation to the ordinary resolution for approving the Agreement and the Proposed Caps at the Special General Meeting.

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LETTER FROM THE BOARD

SPECIAL GENERAL MEETING

A notice convening the Special General Meeting, which will be held at Unit 702B, 7th Floor, East Ocean Centre, 98 Granville Road, Tsimshatsui, Kowloon, Hong Kong on Monday, 21 June 2004 at 1:30 p.m. to seek the approval from the Independent Shareholders with respect to the Agreement and the Proposed Caps is set out on pages 35 to 36 of this circular.

A form of proxy for use at the Special General Meeting is enclosed with this circular. Whether or not you are able to attend the Special General Meeting in person, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon to the office of Secretaries Limited, the Company’s branch share registrar in Hong Kong, at G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong as soon as possible, and in any event not less than 48 hours before the time appointed for holding the Special General Meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting at the Special General Meeting or any adjournment thereof should you so desire.

Mr. William Zen and Mr. Derek Zen and their respective associates will abstain from voting on the ordinary resolution to be proposed at the Special General Meeting to approve the Agreement and the Proposed Caps, which shall be taken by poll.

RECOMMENDATION

Access Capital has been appointed to advise the Independent Board Committee and the Independent Shareholders with regard to fairness and reasonableness of the terms of the Agreement and the Proposed Caps. The letter of advice from Access Capital containing its advice to the Independent Board Committee and the Independent Shareholders and the principal factors and reasons considered in arriving such advice is set out on pages 14 to 26 of this circular.

A letter from the Independent Board Committee, which stated the recommendation from the Independent Board Committee (having taking into account the advice from Access Capital) regarding the Agreement and the Proposed Caps, is set out on page 13 of this circular.

GENERAL

Your attention is drawn to the additional information set out in the appendix of this circular, the letter from the Independent Board Committee, the letter from Access Capital, and the notice of the Special General Meeting.

Yours faithfully,

By Order of the Board

Zen Wei Peu, Derek

Vice Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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WAI KEE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 610)

4 June 2004

To the Independent Shareholders

Dear Sir or Madam,

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

We refer to the circular of the Company dated 4 June 2004 (the “Circular”), of which this letter forms part. Terms used herein shall have the same meaning as defined in the Circular unless the context otherwise requires.

In view of the interest of the Independent Shareholders, we have been appointed by the Board to constitute the Independent Board Committee to consider and advise the Independent Shareholders as to the fairness and reasonableness in relation to the Agreement and the Proposed Caps. Access Capital has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in this respect. Details of their advice, together with the principal factors and reasons taken into consideration in arriving at such advice, are set out in their letter on pages 14 to 26 of the Circular.

Your attention is also drawn to the appendix of the Circular, the “Letter from the Board” as set out in on pages 4 to 12 of the Circular, and the notice of the Special General Meeting.

Having taken into account the information set out in the “Letter from the Board”, and the principal factors, reasons and recommendations set out in the letter from Access Capital, we consider the terms of the Agreement and the Proposed Caps to be fair and reasonable so far as the Independent Shareholders are concerned and believe that the Agreement and the Proposed Caps are in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the Special General Meeting to approve the Agreement and the Proposed Caps.

Yours faithfully,

For an on behalf of

The Independent Board Committee Wong Che Ming, Steve

Wan Siu Kau, Samuel

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LETTER FROM ACCESS CAPITAL

The following is the full text of the letter of advice to the Independent Board Committee and the Independent Shareholders from Access Capital prepared for incorporation in this circular.

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Suite 606 6th Floor Bank of America Tower 12 Harcourt Road Central Hong Kong

4 June 2004

To: The Independent Board Committee of

Wai Kee Holdings Limited and the Independent Shareholders

Dear Sirs,

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

I. INTRODUCTION

We refer to our appointment to advise the Independent Board Committee and the Independent Shareholders with regard to the terms of the Wai Kee Connected Transactions contemplated under the Agreement and the Proposed Caps in relation to these Wai Kee Connected Transactions. Details of which are contained in the “Letter from the Board” set out on pages 4 to 12 of a circular to the Shareholders dated 4 June 2004 (the “Circular”), of which this letter forms part. Capitalised terms used in this letter shall have the same meaning as defined in the Circular, unless the context otherwise specifies.

As at the Latest Practicable Date, Mr. William Zen and Mr. Derek Zen were holding approximately 7.89%, in aggregate, of the shareholding interest in I-China. Upon the transfer of the Staff Share Purchasing Scheme Shares, Mr. William Zen and Mr. Derek Zen will together hold more than 10% of the issued share capital in I-China and I-China will then be considered as a connected person of the Company under the Listing Rules. The Wai Kee Connected Transactions will, therefore, subject to reporting, announcement and Independent Shareholders’ approval at a general meeting.

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LETTER FROM ACCESS CAPITAL

As stated in the “Letter from the Board”, the Company will seek the approval of the Independent Shareholders at the Special General Meeting of the Agreement and the Proposed Caps in relation to the Wai Kee Connected Transactions. Mr. William Zen and Mr. Derek Zen, and their respective associates will abstain from voting on the resolution to be proposed at the Special General Meeting to approve the Agreement and the Proposed Caps. Vast Earn Group Limited, a substantial shareholder who holds over 50% of the voting rights amongst the Independent Shareholders, has undertaken to the Company to vote in favour of the resolution to be proposed at the Special General Meeting.

II. THE INDEPENDENT BOARD COMMITTEE

The Board is currently comprised of (i) three executive directors, namely Messrs. Zen Wei Pao, William, Zen Wei Peu, Derek and Fong Shiu Leung, Keter; (ii) two nonexecutive directors, namely Messrs. Lam Wai Hon, Patrick and Cheng Chi Pang, Leslie; and (iii) two independent non-executive directors, namely Messrs. Wong Che Ming, Steve and Wan Siu Kau, Samuel.

An Independent Board Committee comprising Messrs. Wong Che Ming, Steve and Wan Siu Kau, Samuel, has been established to consider the terms of the Agreement and the Proposed Caps.

We have been appointed by the Company to advise the Independent Board Committee as to whether the terms of the Agreement and the Proposed Caps are fair and reasonable so far as the Independent Shareholders are concerned, and to give our opinion in relation to the Agreement and the Proposed Caps for the Independent Board Committee’s consideration in making their recommendation to the Independent Shareholders.

III. BASES OF THE OPINION

In formulating our advice, we have relied solely on the statements, information, opinions and representations contained in the Circular and the information and representations provided to us by the Company and/or its senior management staff and/or the Wai Kee Directors. We have assumed that all such statements, information, opinions and representations contained or referred to in the Circular or otherwise provided or made or given by the Company and/or its senior management staff and/or the Wai Kee Directors and for which it is/they are solely responsible were true and accurate and valid at the time they were made and given and continue to be true and valid as at the date of the Circular. We have assumed that all the opinions and representations made or provided by the Wai Kee Directors and/or the senior management staff of the Company contained in the Circular have been reasonably made after due and careful enquiry. We have also sought and obtained confirmation from the Company and/or its senior management staff and/or the Wai Kee Directors that no material facts have been omitted from the information provided and referred to in the Circular.

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LETTER FROM ACCESS CAPITAL

We consider that we have reviewed all currently available information and documents which are available to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our opinions. We have no reason to doubt the truth, accuracy and completeness of the statements, information, opinions and representations provided to us by the Company and/or its senior management staff and/or the Wai Kee Directors and their respective advisers or to believe that material information has been withheld or omitted from the information provided to us or referred to in the aforesaid documents. We have not, however, carried out an independent verification of the information provided, nor have we conducted an independent investigation into the business and affairs of the Company or any of its subsidiaries.

IV. PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our recommendation, we have taken into consideration the following principal factors and reasons:

1. Background to, and reasons for, the Wai Kee Connected Transactions

1.1 Background to the Wai Kee Connected Transactions

The Company is an investment holding company and, through its subsidiaries, the Wai Kee Group (including the I-China Group) is engaged in (i) the construction of civil engineering projects, in particular, government/ public works, (ii) construction of building projects, (ii) production of quarrying products, (iv) investment in, development, operation and management of highways and expressways, and (v) investment in bio-technology businesses in the Greater China region.

It is noted that prior to Completion, members of the Top Tactic Group were wholly-owned subsidiaries of the Company and were engaged in the construction business of the Wai Kee Group.

As part of the consideration under the Restructuring Agreement, the Company transferred the Top Tactic Group to I-China. In order to maintain the listing status of I-China on the Stock Exchange upon Completion, the Company distributed certain interests in I-China to the Shareholders. Details of the Restructuring Agreement and the distribution are set out in a document issued jointly by the Company and I-China on 24 February 2004.

In addition, prior to Completion, the Wai Kee Group had provided Corporate Guarantees in favour of third parties in respect of the obligations of members of the Top Tactic Group (which were, prior to Completion, wholly-owned

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LETTER FROM ACCESS CAPITAL

subsidiaries of the Company) pursuant to various construction contracts and banking facilities of the Top Tactic Group. According to the Wai Kee Directors, it is a common practice in the construction industry in Hong Kong to require the holding company of the contractor to guarantee the performance of construction contracts, in particular, construction contracts for public works. The Wai Kee Directors anticipate that it is likely that the Company will be required to provide Corporate Guarantees for new construction contracts to be entered into by members of the Top Tactic Group initially for a period of three years after Completion. Prior to Completion, the Wai Kee Group provided Corporate Guarantees for construction contracts for a total contract sum of approximately HK$2,447 million which represents approximately 92.7% of the total assets of the Wai Kee Group as at 31 December 2003, bond sum for a total sum of approximately HK$196 million which represents approximately 7.4% of the total assets of the Wai Kee Group as at 31 December 2003 and banking facilities of loans and overdraft for a total sum of HK$65 million which represents approximately 2.5% of the total assets of the Wai Kee Group as at 31 December 2003.

Shareholders should note that the parent company guarantee, undertaking or indemnity provided by the Wai Kee Group to independent employers or joint venture partners of projects undertaken by members of the Top Tactic Group are unlimited in liability. The comparison with the contract sum of the construction contracts is a matter for reference purpose only.

In consideration of the provision of the Corporate Guarantees, the Wai Kee Group has been charging the Top Tactic Group corporate guarantee fees based on normal commercial terms with reference to the prevailing market rates charged by financial institutions in Hong Kong. The market rate for similar guarantee provided by a financial institution in Hong Kong is approximately 1% p.a. of the bond sum which in turn represents 10% of the contract sum in general. The charges on banking facilities supported by guarantee of the Company are based on the charges/fees levied by commercial banks in Hong Kong. The corporate guarantee fees have been charged as follows:

either (i) 0.1% p.a. of the contract sum if the Company issues a guarantee, undertaking or indemnity to employers or joint venture partners of projects undertaken by members of the Top Tactic Group; or (ii) 0.1% p.a. of the bond sum if the Company issues a guarantee to financial institution(s) which provide performance and/or tender bonds for the projects undertaken by the Top Tactic Group and no fee has been charged under the aforesaid item (i);

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LETTER FROM ACCESS CAPITAL

0.5% p.a. of the banking facilities supported by a guarantee provided by the Company; or
0.1% p.a. of HK$70,000,000 (being the amount of the guarantee provided by the Company to the Hong Kong Housing Authority as at the date of the Circular).

Since I-China is a non wholly-owned subsidiary of the Company and Messrs. William Zen and Derek Zen, both directors of the Company, together will hold more than 10% of the shareholding of I-China upon the transfer of the Staff Share Purchasing Scheme Shares, I-China will be considered a connected person of the Company under Chapter 14A of the Listing Rules. Accordingly, the Wai Kee Connected Transactions will, therefore, subject to reporting, announcement and Independent Shareholders’ approval at a general meeting.

1.2 Reasons for the Wai Kee Connected Transactions

According to the Wai Kee Directors, the Wai Kee Connected Transactions will continue to be conducted in the ordinary and usual course of business of the Wai Kee Group and in accordance with the terms of the relevant agreements, which were negotiated on an arm’s length basis.

Based on our discussions with the Wai Kee Directors and other independent third parties who are engaged in the same business, in particular, the construction of civil engineering projects, as the Wai Kee Group, we note that it is a common practice to require the holding company of a contractor to guarantee the performance of construction contracts in particular, construction contracts for public works. Shareholders should note that and as mentioned in the “Letter from the Board”, such guarantees for projects to independent employer or joint venture partners of projects are also unlimited in liability. We have also reviewed on a random basis, several construction contracts entered into by the Top Tactic Group (including construction contracts for public works) and noted therein requisitions of Corporate Guarantees.

In view of the nature of the construction business of the Wai Kee Group and the Top Tactic Group and the market practice in Hong Kong, it is inevitable that the Company (the ultimate holding company of Top Tactic Group, the contractor of public works construction projects) will be required (i) to provide Corporate Guarantees in favour of third parties in respect of the performance of new construction contracts to be carried out by members of the Top Tactic Group following Completion (unless and until the financial position of the I-China Group is strengthened, achieved a sufficient size

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LETTER FROM ACCESS CAPITAL

and/or acceptable to the employer of the construction projects); and/or (ii) to continue to honour its obligations with respect to those Corporate Guarantees which have been provided prior to Completion and remain valid for a term of a minimum of 12 years from the date of completion of the construction projects (provided no defects arising from the contractor’s faults are discovered within the 12 years period).

Although the provision of the parent company guarantee, undertaking or indemnity by the Wai Kee Group to employers or joint venture partners of projects undertaken by members of the Top Tactic Group is not pro rata in accordance with the equity interest of the Company in I-China, Shareholders should note that, given the potential liability under the aforesaid parent company guarantee, undertaking or indemnity provided by the Wai Kee Group is unlimited prior to Completion as mentioned in the paragraph headed “1.1 Background to the Wai Kee Connected Transactions” above, the financial position of the Wai Kee Group after Completion would neither be worse off nor improve by continuing to grant and/or honour the obligations of members of the Top Tactic Group pursuant to various construction contracts.

Having taken into account the background to and reasons stated above, we are of the view that it is essential for the Wai Kee Group to provide Corporate Guarantees in favour of third parties in respect of the performance of construction contracts carried out by members of Top Tactic Group so as to ensure continuity of the business of the Top Tactic Group and the successful restructuring of I-China (a 67.4% owned subsidiary of the Company). In addition, the entering into the Agreement helps to formalise this arrangement between two listed groups for the next three years. Shareholders should note that the terms of the Wai Kee Connected Transactions contemplated under the Agreement have been and will continue to be conducted on normal commercial terms or on terms no less favourable than terms available to or from independent third parties as described in the paragraph headed “2.1 Terms of the Wai Kee Connected Transactions” below. Accordingly, we believe that it is justifiable and reasonable for the Wai Kee Group to enter into the Agreement and the Wai Kee Connected Transactions contemplated thereunder with I-China.

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LETTER FROM ACCESS CAPITAL

2. Terms of the Wai Kee Connected Transactions and the commercial justification for determining the Proposed Caps

2.1 Terms of the Wai Kee Connected Transactions

According to the Agreement, the Wai Kee Group agrees to provide Corporate Guarantees in favour of third parties in respect of the obligations of members of the Top Tactic Group, which are all subsidiaries of I-China after Completion, pursuant to various construction contracts. In consideration of the provision of the Corporate Guarantees, the Wai Kee Group has been charging the Top Tactic Group corporate guarantee fees (as described in the paragraph headed “1.1 Background to the Wai Kee Connected Transactions” above) based on normal commercial terms and negotiate on an arm’s length basis. Under the current fee scale, the Wai Kee Directors expect that the estimated corporate guarantee fees to be charged by the Wai Kee Group shall not exceed HK$5,000,000 per annum.

Set out below are the historical figures of the aggregate contract sum of the construction projects, the amount of corporate guarantees provided and the amount of fees charged for the two years ended 31 March 2002, the nine months ended 31 December 2002, the year ended 31 December 2003 and the Proposed Caps.

Total assets of the Wai Kee
Group
Aggregate amount of
contract sum of the
construction projects
handled by:
(i) the Top Tactic Group
and the parent company
guarantee required, and
(ii) project companies
in which members of
the Top Tactic Group are
interested in less than
50% share
(Note 2)

For the
Proposed caps for
For the
nine months
For the
each of the three
year ended
ended
year ended
years ending
31 March
31 December 31 December
31 December 2006
2001
2002
2002
2003
2004/2005/2006
HK$’M
HK$’M
HK$’M
HK$’M
3,300
2,702
2,635
2,639
n.a.
The total contract sum
of all projects (i.e. to
be entered into after
23 April 2004) shall
2,171
2,145
2,294
2,447
not exceed HK$5,000
million and the
contract sum of
3,484
3,484
3,484
4,097
project each entered
into after
23 April 2004
shall not exceed
HK$1,000 million
5,655
5,629
5,778
6,544

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LETTER FROM ACCESS CAPITAL

			For the		Proposed caps for
	For the		nine months	For the	each of the three
	year ended		ended	year ended	years ending
	31 March		31 December	31 December	31 December 2006
	2001	2002	2002	2003	2004/2005/2006
	HK$’M	HK$’M	HK$’M	HK$’M
Percentage of aggregate amount	65.8%	79.4%	87.1%	92.7%	n.a.
of contract sum to total assets
of the Wai Kee Group
Aggregate amount of performance	321	315	345	258	Not exceeding
bonds provided by the					HK$200 million
Wai Kee Group_(Note 3)_
Percentage of aggregate amount	9.7%	11.7%	13.1%	9.8%	n.a.
of performance bonds to total
assets of the Wai Kee Group
Aggregate amount of banking	38	42	40	65	Not exceeding
facilities guaranteed by					HK$100 million
the Wai Kee Group
(Note 4)
Percentage of aggregate amount	1.2%	1.6%	1.5%	2.5%	n.a.
of banking facilities to total
assets of the Wai Kee Group
Corporate Guarantee Fees charged	Nil	Nil	2.1	2.7	Not exceeding
(Note 1)					HK$5.0 million

Notes:

The policy of charging guarantee fees by the Wai Kee Group was first implemented in April 2002. Hence, nothing has been charged for the year ended 31 March 2001 and 2002 respectively.
For the two years ended 31 December 2003, the Wai Kee Group had provided corporate guarantees for projects with aggregate contract sum of approximately HK$5.7 billion and HK$6.4 billion respectively, comprising (i) corporate guarantees in favour of employers or partners in projects for projects with aggregate contract sum of approximately HK$2.2 billion and HK$2.4 billion respectively undertaken by members of the Top Tactic Group and (ii) corporate guarantee in favour of employers or partners in projects for projects with contract sum of approximately HK$3.5 billion and HK$4.0 billion respectively undertaken by project companies, in which members of the Top Tactic Group are interested in less than 50% share.

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LETTER FROM ACCESS CAPITAL

According to the Wai Kee Directors, approximately 50% of the Wai Kee Group’s construction contracts that were awarded during the three years ended 31 December 2003 required provision of performance bonds and the corresponding amount was in the range of 5% to 10% of the contract value.
According to the Wai Kee Directors, it is common to take approximately five years to complete contracts which worth up to HK$5 billion and therefore the annual average turnover to be derived from these contracts will be approximately HK$1 billion. Also, the Wai Kee Directors are of the view that the normal payment cycle is around 1.5 months; hence, banking facilities required for annual average turnover of around HK$1 billion will be approximately HK$150 million.

Although it is a common practice in the construction industry in Hong Kong to require the holding company of the contractor to guarantee the performance of construction contracts, there is no public data regarding the fee charge available for comparison purpose. We have discussed with the Wai Kee Directors and were advised that they have made reference to other construction companies when establishing the policy to charge guarantee fees in 2002 as well as with reference to the prevailing market rates charged by financial institutions in Hong Kong. In formulating the fees charged by the Wai Kee Group with regard to the Corporate Guarantees as described in the paragraph headed “1.1 Background to the Wai Kee Connected Transactions” above, the following factors have been taken into account by the Wai Kee Group:

(i) Although the Corporate Guarantees provided by the Wai Kee Group provide full coverage for the performance of the obligations of the Top Tactic Group, the Top Tactic Group remains primarily responsible for any claims under the construction contracts.
(ii) The Wai Kee Group has and will continue to use its expertise and experience to assist the Top Tactic Group to select construction project with an aim to minimise its risks exposure to any potential/possible claims, and monitor the overall progress of the construction projects carried out by the Top Tactic Group.
(iii) The Wai Kee Group has the discretion not to provide Corporate Guarantees (based on their intimate knowledge of the construction projects) and veto the construction projects selected by the I-China Group.

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LETTER FROM ACCESS CAPITAL

Taking into account the background to and reasons for the Wai Kee Connected Transactions set out above and the aforesaid factors, we believe that the Corporate Guarantees provided under the Wai Kee Connected Transactions are normal commercial arrangements between the Wai Kee Group and the I-China Group, the terms of which are reasonable and in the interests of the Independent Shareholders.

2.2 For the Proposed Cap(s) of the Wai Kee Connected Transactions

Wai Kee proposes to set caps in respect of each of the Wai Kee Connected Transactions over the three financial years ending 31 December 2006 as follows (and summarised in the table above):

(i) for parent company guarantee(s), undertaking(s) or indemnity(ies) in respect of liabilities of members of the Top Tactic Group, to employers or joint venture partners in projects undertaken by members of the Top Tactic Group with no cap on liability, the contract sum of each project will not exceed HK$1 billion and the total contract sum of all projects awarded after 23 April 2004 (being the completion date of the Restructuring Agreement) will not exceed HK$5 billion, for each of the three financial years ending 31 December 2006 ;
(ii) in respect of guarantee(s) to financial institutions which provide performance and/or tender bonds for projects undertaken by members of the Top Tactic Group, the bond sum issued after 23 April 2004, (being the completion date of the Restructuring Agreement) will not exceed a maximum amount of liability of HK$200 million, for each of the three financial years ending 31 December 2006; and
(iii) in respect of guarantee(s) in support of banking facilities (loans or over-draft) extended to members of the Top Tactic Group, the banking facilities will not exceed a maximum amount of liability of HK$100 million, for each of the three financial years ending 31 December 2006.

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LETTER FROM ACCESS CAPITAL

According to the Company, the Proposed Caps of the Wai Kee Connected Transactions were determined with reference to the following factors:

the historic aggregate contract sum of all projects or the aggregate bond sum or the aggregate banking facility amount (as described in the paragraph headed “2.1. Terms of the Connected Transactions” above), in particular,
a) it is a common practice of the construction industry in Hong Kong that guarantees for projects to independent employer or joint venture partners of projects are unlimited in liability (as mentioned above), we believe that it is reasonable and justifiable to set a cap by reference to the contract sum of the projects;
b) for the two years ended 31 December 2003, the Wai Kee Group had provided corporate guarantees for projects with aggregate contract sum of approximately HK$5.7 billion and HK$6.4 billion respectively and the growth potential as mentioned in this letter, we are of the view that it is reasonable and justifiable to set the cap for the total contract sum of all projects awarded after 23 April 2004 (being the completion date of the Restructuring Agreement) of not exceeding HK$5 billion, for each of the three financial years ending 31 December 2006;
c) since approximately 50% of the Wai Kee Group’s construction contracts that were awarded during the three years ended 31 December 2003 required provision of performance bonds and the corresponding amount was in the range of 5% to 10% of the contract value, on the basis of a proposed cap for the contract sum of those projects awarded after 23 April 2004 not exceeding HK$5 billion, we believe that it is reasonable and justifiable to set the cap for the bond sum issued after 23 April 2004, (being the completion date of the Restructuring Agreement) of not exceeding a maximum amount of liability of HK$200 million; and
d) since it is common to take approximately five years to complete contracts which worth up to HK$5 billion and therefore the annual average turnover to be derived from these contracts will be approximately HK$1 billion and the normal payment cycle for the Wai Kee Group is around 1.5 months; hence, the banking facilities required for annual average turnover of around HK$1 billion will be approximately HK$150 million. On this

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LETTER FROM ACCESS CAPITAL

basis, we believe that it is reasonable and justifiable to set the cap for the banking facilities of not exceeding a maximum amount of liability of HK$100 million.

the Wai Kee Directors’ assessment of the construction industry (in particular, with reference to potential public works in the next coming years); and
the Wai Kee Directors’ estimation of the aggregate contract sum of construction projects which may be available for public tender and suitable for the Top-Tactic Group to handle in the next few years.

We have discussed with the Wai Kee Directors the market potential of the Top Tactic Group in the next few years and reviewed on a random basis several construction contracts. Although the Wai Kee Directors are of the view that the construction market in Hong Kong would not recover to a level comparable to pre-1997 in the near future, the current government procurement policy (since November 2002) in awarding contacts to contractors on a combination of contractors’ past performance and financial package is a positive signal and the Wai Kee Group has been successfully awarded several construction contracts even though they were not the lowest tenderer. Taking into account the financial position of the Wai Kee Group, the experience of the Top Tactic Group and the current government procurement policy, we believe that there is growth potential of the Top Tactic Group and, in turn, the likelihood of requiring a corresponding increasing amount of guarantees from the Wai Kee Group (due to increasing total amount of contract sum).

Having considered the abovementioned factors and our discussion with the Wai Kee Directors, we are of the view that the Proposed Caps of the Wai Kee Connected Transactions mentioned above are justifiable. In addition, we consider that the basis of determining the Proposed Caps for the Wai Kee Connected Transactions is fair and reasonable so far as the Shareholders are concerned.

V. RECOMMENDATION

Having considered the above principal factors being (i) the background to, and reasons for, the Wai Kee Connected Transactions; and (ii) the terms of the Wai Kee Connected Transactions and the commercial justification for determining the Proposed Caps of the Wai Kee Connected Transactions, we are of the view that the terms of the Agreement and the Wai Kee Connected Transactions contemplated thereunder as well as the Proposed Caps are fair and reasonable so far as the Independent Shareholders are concerned and in the interest of The Company.

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LETTER FROM ACCESS CAPITAL

Furthermore, in relation to compliance with the conditions set out in the Listing Rules, the Wai Kee Directors will request the auditors of the Company to review the Wai Kee Connected Transactions and confirm that the terms of the Wai Kee Connected Transactions have received the approval of the Board, have been entered into in accordance with the terms of the Agreement, and that the value of the Wai Kee Connected Transactions have not exceeded the Proposed Caps. On this basis, we believe that the aforesaid condition has been given in the interests of the Independent Shareholders and provide additional safeguards to the Company.

Accordingly, we advise the Independent Board Committee to recommend the Independent Shareholders to vote in favour of the resolution to accept and approve the Agreement and the Wai Kee Connected Transactions contemplated thereunder, as well as the Proposed Caps in relation to the Wai Kee Connected Transactions.

Yours faithfully, For and on behalf of Access Capital Limited Jeanny Leung Managing Director

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GENERAL INFORMATION

APPENDIX

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Wai Kee Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, opinions expressed in this circular have been arrived at after due and careful consideration and there are no other facts the omission of which would make any statement herein misleading.

DIRECTORS’ INTERESTS

As at the Latest Practicable Date, the interests and short positions of the directors and chief executive of the Company in the shares, underlying shares and debentures of the Company or any associated corporations (within the meaning of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO) or were required to be entered in the register maintained by the Company pursuant to section 352 of the SFO or were required, pursuant to the Model Code for Securities Transactions by Directors of Listing Companies, to be notified to the Company and the Stock Exchange were as follows:

(I) The Company

(a) Interests in shares

	Capacity/
	Nature of	Number of	Shares held	Percentage
Name of director	interest	Long position	Short position	of holding
				(%)
Zen Wei Pao, William	Personal	192,381,843	—	24.27
		(Note 1)		(Note 2)
Zen Wei Peu, Derek	Personal	183,149,078	—	23.10
		(Note 1)
Lam Wai Hon, Patrick	Personal	500,000	—	0.06
		(Note 1)
Cheng Chi Pang, Leslie	Personal	500,000	—	0.06
		(Note 1)
Wong Che Ming, Steve	Personal	1,100,000	—	0.14
		(Note 1)

Note:

Long position in the shares (other than pursuant to equity derivatives such as share options, warrants to subscribe or convertible bonds).
As at the Latest Practicable Date, the issued share capital of the Company was 792,824,034 Shares. Accordingly, the percentage has been adjusted.

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GENERAL INFORMATION

APPENDIX

(II) Associated corporations

(a) Interests in shares

Capacity/

		Capacity/
		Nature of	Number of	Shares held	Percentage
Name of director	Name of company	interest	Long position	Short position	of holding
					(%)
Zen Wei Pao, William	Road King Infrastructure	Personal	2,500,000	—	0.43
	Limited		(Note 2)
	Wai Kee (Zens)	Personal	2,000,000	—	10.00
	Construction &		(Note 1)
	Transportation Company
	Limited
	Wai Luen Stone	Personal	30,000	—	37.50
	Products Limited		(Note 1)
	I-China Holdings Limited	Personal	119,400,034	—	1.53
			(Note 1)
		Personal	100,000,000	—	1.28
			(Note 3)
Zen Wei Peu, Derek	Road King Infrastructure	Personal	300,000	—	0.05
	Limited		(Note 1)
		Personal	1,300,000	—	0.22
			(Note 2)
	Wai Kee (Zens)	Personal	2,000,000	—	10.00
	Construction &		(Note 1)
	Transportation
	Company Limited
	Wai Luen Stone	Personal	30,000	—	37.50
	Products Limited		(Note 1)
	I-China Holdings Limited	Personal	497,154,218	—	6.36
			(Note 1)
		Personal	200,000,000	—	2.56
			(Note 3)

— 28 —

GENERAL INFORMATION

APPENDIX

		Capacity/
		Nature of	Number of Shares held		Percentage
Name of director	Name of company	interest	Long position	Short position	of holding
					(%)
Fong Shiu Leung,	Road King Infrastructure	Personal	1,000,000	—	0.17
Keter	Limited		(Note 2)
	I-China Holdings Limited	Personal	50,000,000	—	0.64
			(Note 3)		(Note 4)
Lam Wai Hon, Patrick	I-China Holdings Limited	Personal	1,400,000	—	0.02
			(Note 1)
Cheng Chi Pang, Leslie	I-China Holdings Limited	Personal	1,400,000	—	0.02
			(Note 1)
Wong Che Ming, Steve	I-China Holdings Limited	Personal	3,112,250	—	0.04
			(Note 1)		(Note 4)

Notes:

Long position in the shares (other than pursuant to equity derivatives such as share options, warrants to subscribe or convertible bonds).
Long position in the underlying shares of Road King Infrastructure Limited pursuant to unlisted equity derivatives (including physically settled, cash settled and other equity derivatives). Share options granted to directors or chief executives are included in this category the particulars of which are set out in (II)(b) below.
Pursuant to the staff share purchasing scheme of the Company adopted on 15 March 2004, each of Messrs. Zen Wei Pao, William, Zen Wei Peu, Derek and Fong Shiu Leung, Keter has been granted a right to acquire 100,000,000, 200,000,000 and 50,000,000 shares in I-China from the Company respectively.
As at the Latest Practicable Date, the issued share capital of I-China was 7,814,084,941 Shares. Accordingly, the percentage has been adjusted.

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GENERAL INFORMATION

APPENDIX

(b) Interests in underlying shares through equity derivatives

		Vesting	Exercisable	Exercise	Number of
Name of director	Date granted	period	period	price	share options
				HK$
Zen Wei Pao, William	17 October 2003	5 years	17 October 2003 to	5.15	2,500,000
			16 October 2008
Zen Wei Peu, Derek	17 October 2003	5 years	17 October 2003 to	5.15	1,300,000
			16 October 2008
Fong Shiu Leung, Keter	17 October 2003	5 years	17 October 2003 to	5.15	1,000,000
			16 October 2008

Save as disclosed above, as at the Latest Practicable Date, none of the directors or chief executive of the Company or their associates had any interests or short positions in any shares, underlying shares and debentures of the Company or any associated corporations (within the meaning of the SFO) as recorded in the register to be kept under section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange.

SUBSTANTIAL SHAREHOLDERS

(I) The Company

As at the Latest Practicable Date, so far as is known to any directors or chief executive of the Company, the following persons (other than directors or chief executive of the Company), who had interests or short positions in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO:

		Capacity/
		Nature of	Number of	Shares held	Percentage
Name of shareholder	Name of company	interest	Long position	Short position	of holding
					(%)
Chow Tai Fook Enterprises	Wai Kee Holdings	Corporate	213,868,000	—	26.97
Limited_(Note 2)_	Limited		(Note 1)
New World Development	Wai Kee Holdings	Corporate	213,868,000	—	26.97
Company Limited_(Note 3)_	Limited		(Note 1)

— 30 —

GENERAL INFORMATION

APPENDIX

		Capacity/
		Nature of	Number of	Shares held	Percentage
Name of shareholder	Name of company	interest	Long position	Short position	of holding
					(%)
NWS Holdings Limited	Wai Kee Holdings	Corporate	213,868,000	—	26.97
(Note 4)	Limited		(Note 1)
NWS Service Management	Wai Kee Holdings	Corporate	213,868,000	—	26.97
Limited_(Note 5)_	Limited		(Note 1)
NWS Service Management	Wai Kee Holdings	Corporate	213,868,000	—	26.97
Limited_(Note 6)_	Limited		(Note 1)
Vast Earn Group Limited	Wai Kee Holdings	Personal/	213,868,000	—	26.97
(Note 7)	Limited	Beneficiary	(Note 1)

Notes:

Long position in the shares (other than pursuant to equity derivatives such as share options, warrants to subscribe or convertible bonds).
Chow Tai Fook Enterprises Limited is deemed to be interested in the shares through its interests in more than one-third of the issued share capital of New World Development Company Limited.
New World Development Company Limited is deemed to be interested in the shares through its interest in more than one-third of the issued share capital of NWS Holdings Limited.
NWS Holdings Limited is deemed to be interested in the shares through its interest in its wholly owned subsidiaries, namely NWS Service Management Limited (incorporated in the Cayman Islands), NWS Service Management Limited (incorporated in the British Virgin Islands) and Vast Earn Group Limited.
NWS Service Management Limited (incorporated in the Cayman Islands) is deemed to be interested in the shares through its interests in its wholly owned subsidiary, namely NWS Service Management Limited (incorporated in the British Virgin Islands).
NWS Service Management Limited (incorporated in the British Virgin Islands) is deemed to be interested in the shares through its interests in its wholly owned subsidiary, namely Vast Earn Group Limited.
Vast Earn Group Limited is a wholly owned subsidiary of NWS Service Management Limited (incorporated in the British Virgin Islands).

— 31 —

GENERAL INFORMATION

APPENDIX

(II) Other members of the Wai Kee Group and the I-China Group

As at the Latest Practicable Date, so far as is known to any director or chief executive of the Company and save as disclosed in this circular, the persons (other than a director or chief executive of the Company or a member of the Wai Kee Group and the I-China Group) who were directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Wai Kee Group and the I-China Group were as follows:

		Approximate
		percentage
Name of subsidiary	Name of shareholder	of interest held
		(%)
Cheuk Wah Construction	Goldky Industries Limited	40
Engineering Limited
Eastar Construction	Fulight Engineering Limited	20
Engineering Limited
Grandeur Building Material	Proficiency Building Materials	20
(Shanghai) Limited	and Equipment Limited
	Tse Pang	20
Huge Host Engineering	Downer Mining (Asia) Limited	30
Limited
Wuhan Nature’s Favour	Wuhan Green Century	18
Bioengineering Company	Biotechnical Company Limited
Limited

Save as disclosed above, as at the Latest Practicable Date, no other person (other than a director or chief executive of the Company) had an interest or a short position in the shares and underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO and no other person (other than a director or chief executive of the Company or a member of the Wai Kee Group and the I-China Group) were directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Wai Kee Group and the I-China Group or had any options in respect of any such share capital of any other member of the Wai Kee Group and the I-China Group.

— 32 —

GENERAL INFORMATION

APPENDIX

DIRECTORS’ INTEREST IN CONTRACTS OF SIGNIFICANCE

As at the Latest Practicable Date, none of Wai Kee Directors, were materially interested in any contract or arrangement subsisting at the date of this circular which was significant in relation to the business of the Wai Kee Group.

DIRECTORS’ INTEREST IN ASSETS

As at the Latest Practicable Date, none of the Wai Kee Directors had any direct or indirect interest in any asset which had been acquired, or disposed of by, or leased to any member of the Wai Kee Group or the I-China Group, or was proposed to be acquired, or disposed of by, or leased to any member of the Wai Kee Group or the I-China Group, since 31 December 2003, the date to which the latest published audited financial statements of the Wai Kee Group were made up.

SERVICE CONTRACTS

Save as disclosed below, as at the Latest Practicable Date, none of the Wai Kee Directors has entered into or proposes to enter into any service contract with any member of the Wai Kee Group or the I-China Group (excluding contracts expiring or determinable by the relevant member of the Wai Kee Group or the I-China Group within one year without payment of compensation (other than statutory compensation)).

Each of Messrs. Zen Wei Pao, William, Zen Wei Peu, Derek and Fong Shiu Leung, Keter has entered into a service contract with the Wai Kee Group for a term of three years commencing from 1 August 2003 and thereafter, if mutually agreed in writing, extend for further one year.

Mr. Zen Wei Peu, Derek has entered into a service contract with I-China for a term of three years commencing on 1 May 2004.

EXPERT’S QUALIFICATION AND CONSENT

Access Capital is deemed to be licensed under the SFO and has given and has not withdrawn its written consent to the issue of this circular with the inclusion of and references to its letter dated 4 June 2004, in the form and context in which it appears on pages 14 to 26 of this circular.

EXPERT’S INTEREST IN ASSETS

As at the Latest Practicable Date, Access Capital (i) was not interested, directly or indirectly, in any assets which have been acquired or disposed of by or leased to the Wai Kee Group or the I-China Group since 31 December 2003, being the date to which the latest published audited financial statements of the Wai Kee Group were made up, and (ii) did not have any shareholdings interest in any member of the Wai Kee Group or the I-China Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Wai Kee Group or the I-China Group.

— 33 —

GENERAL INFORMATION

APPENDIX

MATERIAL ADVERSE CHANGE

The Wai Kee Directors are not aware of any material adverse change in the financial or trading positions of the Wai Kee Group and the I-China Group since 31 December 2003, the date to which the latest published audited financial statements of the Wai Kee Group were made up.

GENERAL

(i) The secretary of the Company is Mr. Fong Shiu Leung, Keter, a certified practicing accountant in Australia and also a fellow member of The Hong Kong Society of Accountants.
(ii) The branch share registrar of the Company in Hong Kong is Secretaries Limited at G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong.
(iii) In the event of inconsistency, the English text of this circular shall prevail over the Chinese text.

DOCUMENT AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the Company’s principal place of business in Hong Kong at Unit 702B, 7th Floor, East Ocean Centre, 98 Granville Road, Tsimshatsui, Kowloon, Hong Kong, during normal business hours on any weekday other than public holidays, from the date of this circular up to and including Monday, 21 June 2004:

(i) the memorandum of association and Bye-laws of the Company;
(ii) the Restructuring Agreement and the supplemental agreement dated 17 March 2004;
(iii) the Restructuring Document;
(iv) the Agreement;
(v) the letter of recommendation from the Independent Board Committee as set out in this circular;
(vi) the letter from Access Capital as set out in this circular; and
(vii) the written consent from Access Capital referred to in the paragraph headed “Expert’s qualification and consent” in this appendix.

— 34 —

NOTICE OF SPECIAL GENERAL MEETING

==> picture [49 x 47] intentionally omitted <==

WAI KEE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock code: 610)

NOTICE IS HEREBY GIVEN that a Special General Meeting of Wai Kee Holdings Limited (the “Company”) will be held at Unit 702B, 7th Floor, East Ocean Centre, 98 Granville Road, Tsimshatsui, Kowloon, Hong Kong on Monday, 21 June 2004 at 1:30 p.m. for the purpose of considering and, if thought fit, passing the following resolution as an ordinary resolution:

ORDINARY RESOLUTION

“ THAT :

(a) the Agreement dated 19 May 2004 (as defined in the circular of the Company (the “ Circular ”)), a copy of which is tabled at the meeting and marked “A” and initialled by the chairman of the meeting for identification purpose, and the transactions contemplated thereunder be and are hereby approved;
(b) the following annual caps in respect of the Wai Kee Connected Transactions (as defined in the Circular) be and are hereby approved:
(i) for guarantee, undertaking or indemnity in respect of liabilities of Top Tactic Holdings Limited and its subsidiaries (the “ Top Tactic Group ”) to employers of or partners in projects undertaken by members of the Top Tactic Group, no cap on liability provided that the contract sum of each project will not exceed HK$1 billion and the total contract sum of all projects awarded after 23 April 2004 will not exceed HK$5 billion, for each of the three financial years ending 31 December 2006;
(ii) in respect of guarantee to financial institutions which provide performance and/or tender bonds for projects undertaken by members of the Top Tactic Group, the bond sum issued after 23 April 2004 will not exceed a maximum amount of HK$200 million, for each of the three financial years ending 31 December 2006;
(iii) in respect of guarantee in support of banking facilities (loans or over-draft) extended to members of the Top Tactic Group, the banking facilities will not exceed a maximum amount of liability of HK$100 million, for each of the three financial years ending 31 December 2006; and

— 35 —

NOTICE OF SPECIAL GENERAL MEETING

(c) any one director of the Company, or any two directors of the Company if the affixation of the common seal is necessary, be and is/are hereby authorised for and on behalf of the Company to execute all such other documents, instruments and agreements and to do all such acts or things deemed by him to be incidental to, ancillary to or in connection with the matters contemplated in or relating to the Agreement and/or the Wai Kee Connected Transactions as he may consider necessary, desirable or expedient.”

By Order of the Board Fong Shiu Leung, Keter Company Secretary

Hong Kong, 4 June 2004

Registered office: Principal place of business Clarendon House in Hong Kong: Church Street Unit 702B, 7th Floor Hamilton HM 11 East Ocean Centre Bermuda 98 Granville Road Tsimshatsui Kowloon Hong Kong

Notes:

Any member of the Company entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a member of the Company.
A form of proxy for use at the meeting is enclosed. To be valid, the proxy form, together with the notarially certified power of attorney or other authority (if any) under which it is signed must be delivered to the office of Secretaries Limited, the Company’s branch share registrar in Hong Kong, at G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong as soon as possible, and in any event not less than 48 hours before the time appointed for holding the Special General Meeting or any adjournment thereof.
Where there are joint holders of any share, any one of such holders may vote at the meeting, either in person or by proxy, in respect of such shares as if he were solely entitled to vote, but if more than one of such joint holder be present at the meeting in person or by proxy, the person so present whose name stands first in the register of member of the Company in respect of such share shall alone be entitled to vote in respect of it.
Completion and return of the form of proxy will not preclude a member from attending the meeting and voting in person at the meeting or any adjourned meeting if he so desires. If a member attends the meeting after having deposited the form of proxy, his form of proxy will be deemed to have been revoked.
The votes to be taken at the meeting will be taken by a poll.
As at the date of this notice, the board of directors of the Company comprises three executive directors, namely Messrs. Zen Wei Pao, William, Zen Wei Peu, Derek and Fong Shiu Leung, Keter, two non-executive directors, namely Messrs. Lam Wai Hon, Patrick and Cheng Chi Pang, Leslie, and two independent non-executive directors, namely Messrs. Wong Che Ming, Steve and Wan Siu Kau, Samuel.

— 36 —

==> picture [49 x 48] intentionally omitted <==

WAI KEE HOLDINGS LIMITED （惠記集團有限公司）

(Incorporated n Bermuda with limited liability)

Form of proxy for use at the Special General Meeting (or at any adjournment thereof)

I/We [1] of

being the registered holder(s) of [2]

share(s) of HK$0.10 each in the issued share capital of Wai Kee Holdings Limited (the “Company”), hereby appoint the Chairman of the Special General Meeting (the “Meeting”) or [3]

as my/our proxy to attend and vote for me/us on my/our behalf at the Meeting to be held at Unit 702B, 7th Floor, East Ocean Centre, 98 Granville Road, Tsimshatsui, Kowloon, Hong Kong on Monday, 21 June 2004 at 1:30 p.m. (or at any adjournment thereof) in respect of the resolution set out in the notice convening the Meeting as indicated below or, if no such indication is given, as my/our proxy thinks fit and on any other resolution(s) properly put to the Meeting.

ORDINARY RESOLUTION	FOR4	AGAINST4
To approve the Agreement, the transactions contemplated thereunder and the annual caps in respect of the Wai Kee Connected Transactions.

Dated this

day of 2004 Signature [5] :

Notes:

Full name(s) and address(es) to be inserted in BLOCK CAPITALS . In the case of joint holders, the names of all joint holders should be stated.
Please insert the number of shares of HK$0.10 each registered in your name(s). If no number is inserted, this instrument appointing a proxy will be deemed to relate to all such shares of the Company registered in your name(s).
Any Member entitled to attend and vote at the Meeting shall be entitled to appoint another person as his proxy to attend and vote instead of him. A Member may appoint a proxy in respect of part only of his holding of shares in the Company. If any proxy other than the Chairman of the Meeting is appointed, strike out “the Chairman of the Meeting or” and insert the name and address of the proxy desired in the space provided. A proxy need not be a Member of the Company but must attend the Meeting in person to represent you.
IMPORTANT: If you wish to vote for a resolution, tick the box marked “FOR”. If you wish to vote against the resolution, tick the box marked “AGAINST”. Failure to complete a box will entitle your proxy to cast your vote(s) at his discretion. Your proxy will also be entitled to vote at his discretion on any resolution properly put to the Meeting other than that referred to in the notice convening the Meeting.
This instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under its seal or under the hand of an officer, attorney or other person authorised to sign the name. In the case of joint holders, the signature of any one of them is sufficient.
In the case of joint holders of a share, if more than one of such joint holders be present at the Meeting, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the Register in respect of the joint holding.
The instrument appointing a proxy and (if required by the Board) the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power or authority, shall be delivered to the office of Secretaries Limited, the Company’s branch share registrar in Hong Kong, at G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong as soon as possible, and in any event not less than 48 hours before the time appointed for holding the Meeting or any adjournment thereof.
Any alteration made to this instrument appointing a proxy must be initialled.
Delivery of an instrument appointing a proxy shall not preclude a Member from attending and voting in person at the Meeting convened and in such event, the instrument appointing a proxy shall be deemed to be revoked.
The votes to be taken at the Meeting will be taken by a poll.

AI assistant

Wai Kee Holdings Limited — Proxy Solicitation & Information Statement 2004

49336_rns_2004-06-16_df788aac-d148-48eb-8f3b-7ec20f021db1.pdf

WAI KEE HOLDINGS LIMITED

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

WAI KEE HOLDINGS LIMITED

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

LETTER FROM THE BOARD

THE WAI KEE CONNECTED TRANSACTIONS

Background

Corporate guarantee fees

The Agreement

REASONS FOR THE WAI KEE CONNECTED TRANSACTIONS

LETTER FROM THE BOARD

THE PROPOSED CAPS

A. Proposed Cap in respect of the guarantee, undertaking or indemnity providing for the liabilities of members of the Top Tactic Group to independent employers of or partners in projects undertaken by members of the Top Tactic Group

LETTER FROM THE BOARD

B. Proposed Cap in respect of the guarantee to financial institutions which provide performance and/or tender bonds for projects undertaken by members of the Top Tactic Group

C. Proposed Cap in respect of the guarantee in support of banking facilities (loans or over-drafts) extended to members of the Top Tactic Group

PROCEDURES FOR DEMANDING A POLL

SPECIAL GENERAL MEETING

RECOMMENDATION

GENERAL

WAI KEE HOLDINGS LIMITED

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

POSSIBLE NON-EXEMPT CONTINUING CONNECTED TRANSACTIONS

I. INTRODUCTION

LETTER FROM ACCESS CAPITAL

II. THE INDEPENDENT BOARD COMMITTEE

III. BASES OF THE OPINION

LETTER FROM ACCESS CAPITAL

IV. PRINCIPAL FACTORS AND REASONS CONSIDERED

1. Background to, and reasons for, the Wai Kee Connected Transactions

1.1 Background to the Wai Kee Connected Transactions

LETTER FROM ACCESS CAPITAL

1.2 Reasons for the Wai Kee Connected Transactions

LETTER FROM ACCESS CAPITAL

LETTER FROM ACCESS CAPITAL

2.2 For the Proposed Cap(s) of the Wai Kee Connected Transactions

V. RECOMMENDATION

LETTER FROM ACCESS CAPITAL

RESPONSIBILITY STATEMENT

DIRECTORS’ INTERESTS

(I) The Company

(a) Interests in shares

(II) Associated corporations

(a) Interests in shares

Capacity/

(b) Interests in underlying shares through equity derivatives

SUBSTANTIAL SHAREHOLDERS

(I) The Company

(II) Other members of the Wai Kee Group and the I-China Group

DIRECTORS’ INTEREST IN CONTRACTS OF SIGNIFICANCE

DIRECTORS’ INTEREST IN ASSETS

SERVICE CONTRACTS

EXPERT’S QUALIFICATION AND CONSENT

EXPERT’S INTEREST IN ASSETS

MATERIAL ADVERSE CHANGE

GENERAL

DOCUMENT AVAILABLE FOR INSPECTION

WAI KEE HOLDINGS LIMITED

ORDINARY RESOLUTION

“ THAT :

NOTICE OF SPECIAL GENERAL MEETING

WAI KEE HOLDINGS LIMITED （惠記集團有限公司）

Form of proxy for use at the Special General Meeting (or at any adjournment thereof)

More from Wai Kee Holdings Limited

Wai Kee Holdings Limited Proxy Solicitation & Information Statement 2004