Wisdomcome Group Holdings Ltd. - Proxy Solicitation & Information Statement 2009

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in B.A.L. Holdings Limited (the “Company”), you should at once hand this circular and the accompanying forms of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or the transfer was effected for onward transmission to the purchaser or transferee.

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

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

(Continued into Bermuda with limited liability)

(Stock Code: 8079)

PROPOSALS FOR BONUS ISSUE OF SHARES AND REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES AND NOTICES OF SPECIAL GENERAL MEETINGS

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

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A notice convening a special general meeting of the Company to consider and, if thought fit, approve the bonus issue of shares to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Monday, 2 November 2009 at 4:30 p.m. and a notice convening another special general meeting of the Company to consider and, if thought fit, approve the refreshment of the general mandate to issue shares to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Thursday, 12 November 2009 at 4:30 p.m. are set out on pages 38 to 39 and pages 40 to 42 of this circular respectively.

Whether or not you are able to attend each of the special general meetings, you are requested to complete and return the respective accompanying forms of proxy, in accordance with the instructions printed thereon and deposit the same as soon as possible and in any event not later than 48 hours before the respective time of the special general meetings or any adjournments thereof with the Company’s Hong Kong branch share registrar, Tricor Standard Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong. Completion and return of the forms of proxy will not preclude you from attending and voting at each of the extraordinary general meetings or any adjournments thereof should you so wish.

This circular will remain on the “Latest Listed Company Information” page of the websites of the Stock Exchange at www.hkexnews.hk and the Company’s website for at least 7 days from the date of its posting.

13 October 2009

CHARACTERISTICS OF GEM

GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

	Page
Definitions	1
Expected timetable 4
Letter from the Board 5
Letter from the Independent Board Committee 14
Letter from Veda Capital	15
Appendix – Summary of Bermuda Constitutional Documents	20
Notice of the 1st SGM 38
Notice of the 2nd SGM	40

ii -

DEFINITIONS

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

“1st SGM”

a special general meeting of the Company to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Monday, 2 November 2009 at 4:30 p.m. for the purpose of approving the Bonus Issue

“2nd SGM” a special general meeting of the Company to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Thursday, 12 November 2009 at 4:30 p.m. for the purpose of approving the Refreshed Mandate
“AGM” the annual general meeting of the Company held on 22 April 2009
“Announcement” the announcement of the Company dated 22 September 2009 in relation to the Bonus Issue
“associates” has the meaning ascribed to it under the GEM Listing Rules
“Board” the board of Directors
“Bonus Issue” allotment and issue of four Bonus Shares for every one existing Share to the Qualifying Shareholders whose names appear on the register of members of the Company on the Record Date
“Bonus Share(s)” new Share(s) to be allotted and issued by way of Bonus Issue by the Company as described herein
“Business Day” a day (not being a Saturday, a Sunday or days on which a typhoon signal No. 8 or black rainstorm warning is hosted in Hong Kong at 10:00 a.m.) on which banks are generally open for general banking business in Hong Kong
“Bye-Laws” the bye-laws of the Company
“CCASS”
the Central Clearing and Settlement System established and operated by HKSCC
“Companies Act” Companies Act 1981 of Bermuda (as amended)
“Company” B.A.L. Holdings Limited, an exempted company continued into Bermuda with limited liability and the Shares of which are listed on GEM
1 -

DEFINITIONS

“connected persons” has the meaning ascribed thereto in the GEM Listing Rules “Convertible Notes” the two-year zero coupon convertible loan notes due 2010 in the total principal amount of HK$10,000,000 issued by the Company on 18 January 2008, of which HK$5,000,000 remains outstanding as at the latest practicable date
“Directors” the directors of the Company from time to time
“Excepted Shareholders” those Overseas Shareholders, the Board, after making enquiries pursuant to rule 17.41 of the GEM Listing Rules, considers it necessary or expedient on account either of legal restrictions under the laws of the relevant place or the requirements of the relevant body or stock exchange in that place not to extend the Bonus Issue to them
“Existing Mandate” the general mandate granted at the AGM to the Directors to allot, issue and deal with 14,817,652 new Shares, being 20% of the issued share capital of the Company as at the date of the AGM
“GEM” the Growth Enterprise Market of the Stock Exchange
“GEM Listing Rules” the Rules Governing the Listing of Securities on GEM
“Group” the Company and its subsidiaries
“HKSCC” Hong Kong Securities Clearing Company Limited
“Hong Kong” the Hong Kong Special Administrative Region of the PRC
“Independent Board Committee” an independent committee of the Board established by the Board to advise the Independent Shareholders in respect of the Refreshed Mandate
“Independent Shareholders” Shareholders other than the executive Directors Ms. Siu York Chee and Mr. Leung Kwok Kui and their respective associates
“Latest Practicable Date” 9 October 2009, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information referred to in this circular
2 -

DEFINITIONS

“Listing Committee” the listing committee of the Stock Exchange “Options” share option(s) granted under the share option scheme adopted by the Company on 24 September 2001
“Overseas Shareholders” holders of Shares whose addresses as shown on the register of members on the Record Date are outside Hong Kong
“PRC” the People’s Republic of China, which, for the purpose of this circular, shall exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan
“Qualifying Shareholders” holders of Shares not being Excepted Shareholders who are entitled to the Bonus Issue
“Record Date” 2 November 2009, being the date for determining the entitlement to the Bonus Issue
“Refreshed Mandate” the general mandate proposed to be granted to the Directors at the 2nd SGM to allot, issue and deal with new Shares not exceeding 20% of the issued share capital of the Company as at the date of the passing of the relevant ordinary resolution by the Independent Shareholders
“Share(s)” ordinary share(s) of par value of HK$0.01 each in the share capital of the Company
“Shareholders” holders of the Shares “Stock Exchange” The Stock Exchange of Hong Kong Limited “Veda Capital” Veda Capital Limited, a licensed corporation to carry out type 6 (advising on corporate finance) regulated activities under the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), and the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the refreshment of the Existing Mandate by granting the Refreshed Mandate
“HK$” Hong Kong dollars, the lawful currency of Hong Kong “%” per cent.
3 -

2009

EXPECTED TIMETABLE

The expected timetable for the Bonus Issue is set out below:

Despatch of the circular and notice of the 1st SGM . . . . . . . . . . . . . . . . . . . . . Tuesday, 13 October Last day of dealings in the Shares on a cum-entitlement basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 27 October First day of dealings in the Shares on an ex-entitlement basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 28 October Latest time for lodging transfer forms of the Shares for registration in order to qualify for the Bonus Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4:00 p .m ., Thursday, 29 October Latest time for lodging the Option exercise forms together with a remittance in cash for the amount of the exercise price for the respective Shares in order to be qualified for the Bonus Issue . . . . . . . . . . . . . . . . . . . . . . . . . . .4:00 p .m ., Thursday, 29 October Closure of register of members of the Company . . . . . . . . . . . . . . . . . . . . . . . Friday, 30 October to Monday, 2 November (both days inclusive) Latest date and time to return form of proxy for the 1st SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:30 p .m ., Saturday, 31 October Date and time of the 1st SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:30 p .m ., Monday, 2 November Record Date for determination of entitlement to the Bonus Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 2 November Register of members re-opens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 3 November Certificates for the Bonus Shares expected to be dispatched . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 9 November Dealings in the Bonus Shares on the Stock Exchange commence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 11 November

Dates or deadlines specified in this circular are indicative only and may be varied by the Company . Any consequential changes to the expected timetable will be published or notified to the Shareholders as and when appropriate .

LETTER FROM THE BOARD

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

(Continued into Bermuda with limited liability)

(Stock Code: 8079)

Executive Directors: Ms. Siu York Chee Mr. Leung Kwok Kui Ms. Leung Ge Yau, LL.B. (Hons), LL.M

Independent non-executive Directors: Mr. Hung Anckes Yau Keung, FCPA (Practising), FCCA, CICPA, CGA Dr. Siu Yim Kwan, Sidney, S.B.St.J. Mr. Tsui Pui Hung, Walter, LL.B. (Hons), LL.M, BSc (Hons)

Registered office Canon’s Court 22 Victoria Street Hamilton HM 12 Bermuda

Head office and principal place of business in Hong Kong: Room 1401, 14th Floor Guardian House 32 Oi Kwan Road Wanchai, Hong Kong

13 October 2009

To the Shareholders

Dear Sir or Madam,

PROPOSALS FOR BONUS ISSUE OF SHARES AND REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

INTRODUCTION

Reference is made to the Announcement made by the Company. The Board proposed the Bonus Issue to the Shareholders in recognition of their continual support. The Bonus Issue is proposed to be made on the basis of four Bonus Shares for every one existing Share held by the Qualifying Shareholders whose names appear on the register of members of the Company on the Record Date.

Under the Existing Mandate, the Directors were granted an unconditional general mandate to allot and issue up to 14,817,652 new Shares, representing 20% of the then issued share capital of the Company of 74,088,260 at the date of AGM. As at the Latest Practicable Date, the Company has issued share capital of 474,088,260 Shares upon the allotment and issued of new placing Shares. Although the Existing Mandate has not been utilized since the date of AGM, the Existing Mandate represents only approximately 3.13% of the issued share capital of the Company as enlarged by the new placing Shares at the Latest Practicable Date. As such, the Board proposes to refresh the Existing Mandate and to grant the Refreshed Mandate to the Directors to issue and allot Shares of the Company not exceeding 20% of the issued share capital of the Company as at the date of the 2nd SGM.

LETTER FROM THE BOARD

The purpose of this circular is to provide you with further information regarding, among other things, (i) the Bonus Issue; (ii) the refreshment of the Existing Mandate; (iii) the recommendation from the Independent Board Committee to the Independent Shareholders; (iv) the recommendation of Veda Capital to the Independent Board Committee and the Independent Shareholders; (v) a notice convening the 1st SGM; and (vi) a notice convening the 2nd SGM.

PROPOSED BONUS ISSUE

Basis of Bonus Issue

Subject to the conditions as set out under the heading “Conditions of the Bonus Issue” below, the Bonus Issue is proposed to be made on the basis of four Bonus Shares for every one existing Share held by the Qualifying Shareholders on the Record Date. On the basis of 474,088,260 existing Shares in issue as at the Latest Practicable Date, and assuming that no further Shares will be issued or repurchased before the Record Date, 1,896,353,040 Bonus Shares will be issued pursuant to the Bonus Issue.

Record Date and Closure of Register of Members

The Bonus Shares will be allotted and issued to the Qualifying Shareholders. Arrangement for the Excepted Shareholders are further elaborated below under the heading “Overseas Shareholders”.

The register of members of the Company will be closed from 30 October 2009 to 2 November 2009, both days inclusive, during which period no transfer of Shares will be effected. In order to qualify for the Bonus Issue, all transfers of Shares must be duly completed, accompanied by the relevant share certificates and lodged with the Company’s branch share registrar in Hong Kong, Tricor Standard Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong for registration no later than 4:00 p.m. on 29 October 2009.

On the basis of (i) no further Shares are issued before the Record Date, a total of 1,896,353,040 Bonus Shares will be allotted and issued pursuant to the Bonus Issue; and (ii) assuming all the Options are exercised and all the Convertible Notes are converted into Shares before the latest lodging time, a total of 1,903,048,912 Bonus Shares will be issued pursuant to the Bonus Issue. Accordingly, the Bonus Shares to be allotted and issued pursuant to the Bonus Issue will therefore be not more than 1,903,048,912 Bonus Shares.

The exact total number of Bonus Shares to be allotted and issued under the Bonus Issue will not be capable of determination until the Record Date. The Company will make an announcement when the number of Bonus Shares is determined.

LETTER FROM THE BOARD

Fractions of Bonus Shares

The Company will not allot any fractions of the Bonus Shares. Bonus Shares representing fractional entitlement will be aggregated and issued to a nominee to be nominated by the Directors. Such Bonus Shares (if any) will be sold and the net proceeds, after deducting the related expenses therefrom, will be retained by the Company for its own benefits.

Reasons for the Bonus Issue

In recognition of the continual support of the Shareholders, the Board decided to propose the Bonus Issue. In addition, the Board believes that the Bonus Issue will enhance the liquidity of the Shares in the market and thereby enlarging the Company’s shareholder and capital base.

Overseas Shareholders

Overseas Shareholders will not be allotted the Bonus Shares if the Directors consider such exclusion to be necessary or expedient on account either of the legal restrictions under the laws of the relevant place or the requirements of the relevant regulatory body or stock exchange in that place. In such circumstances, arrangements will be made for the Bonus Shares which would otherwise have been issued to the Excepted Shareholders, if any, to be sold in the market as soon as practicable after dealing in the Bonus Shares commences. Any net proceeds sale, after deduction of expenses, will be distributed in Hong Kong dollars to the Excepted Shareholders, if any, pro rata to their respective shareholdings and remittances therefore will be posted to them, at their own risk, unless the amount falling to be distributed to any such persons is less than HK$100.00, in which case it will be retained for the benefit of the Company.

For those Overseas Shareholders, enquiry will be made by the Board pursuant to rule 17.41 of the GEM Listing Rules. Upon such enquiry, if the Board is of the view that the exclusion of the Overseas Shareholders is necessary or expedient, the Bonus Shares will not be granted to the Excepted Shareholders. In such circumstances, arrangements will be made for the Bonus Shares which would otherwise have been issued to the Excepted Shareholders, if any, to be sold in the market as soon as practicable after dealings in the Bonus Shares commence.

Based on the register of members of the Company as at the Latest Practicable Date, there were 7 Overseas Shareholders with registered addresses in Singapore and Macau which are jurisdiction outside Hong Kong. The Bonus Shares will be issued and allotted to the Overseas Shareholders with registered addresses in Singapore and Macau.

Status of Bonus Shares

The Bonus Shares, upon issued, will rank pari passu with the Shares then existing in all respects, including the entitlement of receiving dividends and other distributions the record date for which is on or after the date of allotment and issue of those Bonus Shares.

LETTER FROM THE BOARD

Conditions of the Bonus Issue

The Bonus Issue is conditional, among other things, upon:

(a) the passing of an ordinary resolution by the Shareholders at the 1st SGM for approving the Bonus Issue;
(b) the Listing Committee granting the listing of, and permission to deal in, the Bonus Shares; and
(c) compliance with the relevant legal procedures and requirements under the Companies Act to effect the Bonus Issue.

Listing and Dealing

The Shares are not listed or dealt in on any other stock exchanges except the Stock Exchange.

If approved by the Shareholders at the 1st SGM, the Bonus Shares will be allotted and issued on or before 9 November 2009. Application will be made to the Listing Committee for the listing of, and permission to deal in, the Bonus Shares to be allotted and issued pursuant to the Bonus Issue. The Bonus Shares will not be listed or dealt in on any other stock exchange nor is listing or permission to deal in the same being or proposed to be sought from any other stock exchanges.

Subject to the satisfaction of the above conditions, it is expected that the dealings of the Bonus Shares on the Stock Exchange will commence on 11 November 2009.

The Directors confirm that none of the Shareholders will be required to abstain from voting at the 1st SGM.

Adjustments to Convertible Notes and Options

Implementation of the Bonus Issue will lead to adjustments to the conversion price and/or number of Shares to be issued upon conversion of the Convertible Notes and Options. The Company will notify the respective holders of the Convertible Notes and Options regarding the adjustments to be made pursuant to the respective terms and conditions of the Convertible Notes and Options and notify the Shareholders by way of announcement. Such adjustments will be certified by an approved merchant bank or the auditors of the Company (as the case may be). Save for the Convertible Notes and Options, the Company has no outstanding options, warrants or convertible securities to subscribe for any Shares.

LETTER FROM THE BOARD

Certificates for Bonus Shares

It is expected that certificates for the Bonus Shares will be posted on or before 9 November 2009 after all the conditions have been fulfilled at the risk of the Shareholders entitled thereto to their respective addresses shown on the register of members of the Company on the Record Date.

Subject to the granting of listing of, and permission to deal in, the Bonus Shares on the Stock Exchange, the Bonus Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Bonus Shares on the Stock Exchange or such other date as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time. Dealings in the Bonus Shares are expected to commence on 11 November 2009.

Expected Timetable

The expected timetable for the Bonus Issue is set out on page 4 of this circular.

Dates and deadlines specified in this circular are indicative only and may be varied by the Company. Any consequential changes to the expected timetable will be published or notified to the Shareholders as and when appropriate.

REFRESHMENT OF EXISTING MANDATE TO ISSUE SHARES

The Existing Mandate

At the AGM, the Shareholders approved, among other things, an ordinary resolution to grant to the Directors the Existing Mandate to issue, allot and deal with up to 14,817,652 Shares, which is equivalent to 20% of the then issued share capital of the Company.

Reasons for the Refreshment of the Existing Mandate

The Group is principally engaged in retails of beauty products in Hong Kong and also in the provision of beauty services, clinical services and beauty courses in Hong Kong, Macau and China.

References are made to the announcements of the Company dated 16 June 2009 and 31 July 2009 and the circular of the Company dated 2 July 2009 in relation to, among other things, the placing of 400,000,000 new Shares. As at the Latest Practicable Date, the Company has an issued share capital of 474,088,260 Shares upon the allotment and issued of new placing Shares. Although the Existing Mandate has not been utilized since the date of AGM, the Existing Mandate represents only approximately 3.13% of the issued share capital of the Company as at the Latest Practicable Date. The Directors believe that the Refreshed Mandate will provide a flexible means for the Company to raise further funds through the issue of new Shares for its future business development. Accordingly,

LETTER FROM THE BOARD

the Directors consider that the approval of the grant of the Refreshed Mandate is in the best interests of the Company and the Shareholders as a whole. In this regard, the Board proposes to refresh the general mandate to allow the Directors to issue and allot Shares not exceeding 20% of the issued share capital of the Company as at the date of the 2nd SGM.

The Refreshed Mandate

As at the Latest Practicable Date, the Company has in issue an aggregate of 474,088,260 Shares. Subject to the passing of the proposed ordinary resolution for the approval of the Bonus Issue at the 1st SGM and on the basis that no Shares will be issued and/or repurchased by the Company from the Latest Practicable Date up to the date of the 2nd SGM, the Refreshed Mandate will allow the Directors to be given unconditional general mandate to allot and issue up to a maximum of 474,088,260 Shares, representing 20% of the issued share capital of the Company at the 2nd SGM upon completion of the Bonus Issue.

The Refreshed Mandate will, if granted at the 2nd SGM, 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 which the next annual general meeting of the Company is required to be held in accordance with Bermuda law or the Bye-Laws; and (iii) its revocation or variation by ordinary resolution(s) of the Shareholders in general meeting.

Equity Fund Raising Activities in the Past Twelve Months

				Actual use of
				proceeds as
Date of		Net proceeds	Intended use of	at the Latest
announcement	Description	(approximately)	proceeds	Practicable Date
16 June 2009	Placing of	HK$39.05	For future	Utilized as
	400,000,000	million	business	general
	new Shares at		development	working capital
	HK$0.10 each		and general	and for future
			working	business
			capital	development of
				the Group
22 January 2009	Placing of	HK$3.39	For general	Fully utilized
	40,000,000	million	working	as general
	new Shares at		capital of the	working capital
	HK$0.09 each		Group and/or	of the Group
			possible future
			investment

Save as disclosed herein, the Company had not conducted any equity fund raising activities in the past twelve months immediately preceding the Latest Practicable Date.

10 -

LETTER FROM THE BOARD

GENERAL

Pursuant to rule 17.42A of the GEM Listing Rules, the refreshment of the Existing Mandate requires approval of the Independent Shareholders at the 2nd SGM, where any controlling shareholders and their associates or, where there are no controlling shareholders, the Directors (excluding independent non-executive Directors) and the chief executive of the Company and their respective associates shall abstain from voting in favour of the grant of the Refreshed Mandate.

As at the Latest Practicable Date, there was no controlling Shareholder. Accordingly, the executive Directors Ms. Siu York Chee, who controls and is entitled to exercise control over the voting right in respect of 81,286 Shares, representing approximately 0.017% of the issued share capital of the Company, and Mr. Leung Kwok Kui, who controls and is entitled to exercise control over the voting right in respect of 286 Shares, and their respective associates (being Ms. Hau Lai Mei, Mr. Shiu Stephen Junior and Heavenly Blaze Limited which altogether hold 18,339,856 Shares, representing approximately 3.87% of the total issued share capital of the Company, and are entitled to exercise control over the voting right in respect of such Shares) are required to abstain and will abstain from voting in favour of the ordinary resolution for approving the grant of the Refreshed Mandate at the 2nd SGM.

There was (i) no voting trust or other agreement or arrangement or understanding entered into by or binding upon Ms. Siu York Chee and Mr. Leung Kwok Kui; and (ii) no obligation or entitlement of Ms. Siu York Chee and Mr. Leung Kwok Kui as at the Latest Practicable Date, whereby they have or may have temporarily or permanently passed control over the exercise of the voting right in respect of their Shares to a third party, either generally or on a case by case basis.

Assuming that Ms. Siu York Chee and Mr. Leung Kwok Kui do not acquire further Shares between the Latest Practicable Date to the date of the 2nd SGM, there is no discrepancy between the beneficial shareholding interests in the Company of Ms. Siu York Chee and Mr. Leung Kwok Kui as disclosed above and the number of Shares in respect of which they will control or will be entitled to exercise control over the voting right at the 2nd SGM.

As of the date hereof, Ms. Siu York Chee, Mr. Leung Kwok Kui and their respective associates have indicated that they have no intention to vote against the ordinary resolution to approve the grant of the Refreshed Mandate at the 2nd SGM.

As of the date hereof, neither Ms. Leung Ge Yau, the executive Director, nor her associates have any Shares and are not required to abstain from voting in favour of the ordinary resolution for approving the grant of the Refreshed Mandate at the 2nd SGM.

SGM

Two notices of the 1st SGM and the 2nd SGM are set out on pages 38 to 39 and pages 40 to 42 respectively of this circular. In accordance with the requirements of the GEM Listing Rules, all votes to be taken at the 1st SGM and the 2nd SGM will be by way of poll. No Shareholders are required to abstain from voting at the 1st SGM on the resolution in relation to the Bonus Issue.

11 -

LETTER FROM THE BOARD

The Company will convene the 1st SGM to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Monday, 2 November 2009 at 4:30 p.m. at which an ordinary resolution will be proposed to approve the Bonus Issue.

The Company will convene the 2nd SGM to be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Thursday, 12 November 2009 at 4:30 p.m. at which an ordinary resolution will be proposed to approve the grant of the Refreshed Mandate.

Two forms of proxy for use at the 1st SGM and the 2nd SGM respectively are enclosed with this circular. Whether or not you intend to attend the 1st SGM and/or the 2nd SGM in person, you are requested to complete the enclosed forms of proxy in accordance with the instructions printed thereon and return them to the Hong Kong branch share registrar of the Company, Tricor Standard Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event, not less than 48 hours before the respective time appointed for holding the 1st SGM, the 2nd SGM or any adjournments thereof. Completion and return of the forms of proxy will not preclude you from attending and voting in person at the 1st SGM and/or the 2nd SGM should you so wish.

INDEPENDENT BOARD COMMITTEE

The Independent Board Committee which comprises Mr. Hung Anckes Yau Keung, Dr. Siu Yim Kwan, Sidney and Mr. Tsui Pui Hung, Walter, all being the independent non-executive Directors, has been established to advise the Independent Shareholders in respect of the grant of the Refreshed Mandate.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the principal place of business of the Company in Hong Kong at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong during normal business hours on any weekday other than public holidays from the date of this circular up to and including the date of the 2nd SGM:

(1) the memorandum of association and bye-laws of the Company;
(2) a summary of Bermuda’s company law;
(3) the annual reports of the Company for the two years ended 31 October 2007 and 2008;
(4) the annual results announcement of the Company for the year ended 31 October 2008;
(5) all material contracts (not being contracts entered into in the ordinary course of business) entered into by the Group within the two years immediately preceding the date of this circular; and
(6) a copy of each circular issued, if any, pursuant to the requirements set out in Chapters 19 and/or 20 of the GEM Listing Rules which has been issued since the date of the latest published audited account.
12 -

LETTER FROM THE BOARD

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief: (a) the information contained in this circular is accurate and complete in all material respects and not misleading; (b) there are no other matters the omission of which would make any statement in this circular misleading; and (c) all opinions expressed in this circular have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable.

RECOMMENDATION

Veda Capital has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the grant of the Refreshed Mandate. The text of the letter of advice from Veda Capital containing its recommendation and the principal factors and reasons that have been taken into consideration in arriving at its recommendation are set out on pages 15 to 19 of this circular.

The Independent Board Committee, having taken into account the advice of Veda Capital, considers the terms of the Refreshed Mandate to be fair and reasonable so far as the Company and the Independent Shareholders are concerned. Accordingly, the Independent Board Committee recommends that the Independent Shareholders to vote in favour of the respective resolution to be proposed at the 2nd SGM to approve the grant of the Refreshed Mandate. The text of the letter from the Independent Board Committee is set out on page 14 of this circular.

ADDITIONAL INFORMATION

Your attention is drawn to (i) the letter from the Independent Board Committee set out on page 14 of this circular; and (ii) the letter from Veda Capital to the Independent Board Committee and the Independent Shareholders set out on pages 15 to 19 of this circular.

Yours faithfully,

On behalf of the Board

B.A.L. Holdings Limited Siu York Chee Chairperson

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

(Continued into Bermuda with limited liability)

(Stock Code: 8079)

13 October 2009

To the Independent Shareholders

Dear Sir/Madam,

REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

We refer to the circular of the Company dated 13 October 2009 (the “ Circular ”) to the Shareholders, of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

We have been appointed by the Board as members to form the Independent Board Committee and to advise the Independent Shareholders on whether the grant of the Refreshed Mandate is fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Group and the Shareholders as a whole.

Veda Capital has been appointed to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Refreshed Mandate are fair and reasonable so far as the Independent Shareholders are concerned. Your attention is also drawn to the letter from the Board set out on pages 5 to 13 of the Circular and the letter of advice from Veda Capital as set out on pages 15 to 19 of the Circular.

Having considered, among other things, the factors and reasons considered by, and the opinion of Veda Capital as stated in its letter of advice, we consider that the grant of the Refreshed Mandate is fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Group and the Shareholders as a whole.

Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution in relation to the grant of the Refreshed Mandate to be proposed at the 2nd SGM.

Yours faithfully,

On behalf of the Independent Board Committee of

B.A.L Holdings Limited

Mr. Hung Anckes Yau Keung Dr. Siu Yim Kwan, Sidney Mr. Tsui Pui Hung, Walter FCPA (Practising), FCCA, S.B.St.J. LL.B. (Hons), LL.M, BSc (Hons) CICPA, CGA Independent non-executive Independent non-executive Independent non-executive Director Director Director

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LETTER FROM VEDA CAPITAL

The following is the full text of a letter of advice from Veda Capital to the Independent Board Committee and the Independent Shareholders in relation to the proposed grant of Refreshed Mandate, which has been prepared for the purpose of inclusion in the Circular.

==> picture [155 x 38] intentionally omitted <==

Veda Capital Limited

Suite 1302, 13/F Takshing House 20 Des Voeux Road Central Hong Kong

13 October 2009

To the Independent Board Committee and

the Independent Shareholders of
B.A.L. Holdings Limited

Dear Sirs,

REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

INTRODUCTION

We refer to our appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the Refreshed Mandate, details of which are set out in the letter from the Board (the “ Board Letter ”) contained in this circular (the “ Circular ”) dated 13 October 2009 issued by the Company, of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context requires otherwise.

Pursuant to Rule 17.42A of the GEM Listing Rules, the grant of the Refreshed Mandate for the Directors to issue and allot new Shares of the Company not exceeding 20% of the issue share capital of the Company as at the date of the 2nd SGM is subject to the approval of the Independent Shareholders at the 2nd SGM by way of poll. The controlling Shareholders (as defined in the GEM Listing Rules) and their associates or, where there are no controlling Shareholders, Directors (excluding the independent non-executive Directors) and the chief executive and their respective associates shall abstain from voting in favour of the relevant resolution at the 2nd SGM. As at the Latest Practicable Date, the Company has no controlling Shareholders. Accordingly, the executive Directors, Ms. Siu York Chee and Mr. Leung Kwok Kui and their respective associates, who held in aggregate of 18,421,428 Shares, are required to abstain from voting in favour of the relevant resolutions in the 2nd SGM.

The Independent Board Committee (comprising the independent non-executive Directors, namely Mr. Hung Anckes Yau Keung, Dr. Siu Yim Kwan, Sidney and Mr. Tsui Pui Hung, Walter) has been established to advise the Independent Shareholders on the proposed grant of Refreshed Mandate. The appointment of Veda Capital has been approved by the Independent Board Committee.

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LETTER FROM VEDA CAPITAL

BASIS OF OUR ADVICE

In formulating our opinion to the Independent Board Committee and the Independent Shareholders, we have relied on the statements, information, opinions and representations contained in the Circular and the information and representations provided to us by the Company, Directors and management of the Company. We have no reason to believe that any information and representations relied on by us in forming our opinion is untrue, inaccurate or misleading, nor are we aware of any material facts the omission of which would render the information provided and the representations made to us untrue, inaccurate or misleading. We have assumed that all information, representations and opinions contained or referred to in the Circular, which have been provided by the Company, the Directors and the management of the Company and for which they are solely and wholly responsible, were true and accurate at the time when they were made and continue to be true at the date of the 2nd SGM.

The Directors have collectively and individually accepted full responsibility for the accuracy of the information contained in the Circular and have confirmed, having made all reasonable enquiries, which to the best of their knowledge and belief, there are no other facts the omission of which would make any statement in the Circular misleading. We consider that we have been provided with sufficient information to reach an informed view and to provide a reasonable basis for our opinion. We have not, however, conducted any independent in-depth investigation into the business and affairs of the Company or its subsidiaries or associated companies.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion in respect of the proposed grant of Refreshed Mandate, we have taken into account the following principal factors and reasons:

Background

At the date of AGM, the issued share capital of the Company was 74,088,260 Shares. The Existing Mandate was approved by the Shareholders and the Directors were granted, among others, the rights to allot and issue up to 14,817,652 new Shares, representing 20% of the then issued share capital of the Company. Although the Existing Mandate has not been utilized since the date of AGM, the issued share capital of the Company has been increased to 474,088,260 Shares as at the Latest Practicable Date upon the allotment and issue of the new placing Shares under specific mandate due to the placing of 400,000,000 new Shares, details of which are set out in the announcements of the Company dated 16 June 2009 and 31 July 2009 and the circular of the Company dated 2 July 2009.

In order to provide a flexible means for the Company to raise further funds through the issue of new Shares for its future business development, the Board proposes to refresh the general mandate to allow the Directors to issue and allot new Shares not exceeding 20% of the issued share capital of the Company as at the date of the 2nd SGM.

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LETTER FROM VEDA CAPITAL

Subject to the passing of the proposed ordinary resolution for the approval of the Bonus Issue at the 1st SGM and on the basis of no Shares will be issued and/or repurchased by the Company from the Latest Practicable Date up to the date of the 2nd SGM, the Refreshed Mandate will allow the Directors to be given unconditional general mandate to allot and issue up to a maximum of 474,088,260 Shares, representing 20% of the issued share capital of the Company of 2,370,441,300 Shares at the 2nd SGM upon completion of the Bonus Issue.

Reasons for the grant of the Refreshed Mandate

Under the Existing Mandate, the maximum number of Shares that Directors may be allotted and issued was 14,817,652 Shares, representing approximately 3.13% of the issue share capital of the Company of 474,088,260 Shares as at the Latest Practicable Date and upon the completion of the Bonus Issue, representing approximately 0.63% of the issued share capital of the Company of 2,370,441,300 Shares assuming that no Shares will be issued and/or repurchased by the Company from the Latest Practicable Date up to the date of the 2nd SGM. In this regard, the grant of the Refreshed Mandate would provide the Company with necessary flexibility essential for fulfilling any possible funding needs for future business development and/or investment decisions in a timely manner.

Upon completion of the Bonus Issue, the liquidity of the Shares and the capital base of the Company would be enhanced and enlarged, and in view of the recent sign of recovery in global economic environment, the Refreshed Mandate can enhance the financial flexibility necessary for the Group to raise funds by equity financing for further business development or as working capital of the Group.

As referred to the Board Letter, the Board believes that the grant of the Refreshed Mandate is in the best interests of the Company and the Shareholders as a whole by enhancing the financial flexibility necessary for the Group to raise further funds through the issue of new Shares for its future business development. Equity financing is also an important avenue of resources to the Group since it does not create any interest paying obligations on the Group.

As such, we concur with the Directors that the Refreshed Mandate can (i) maintain the financial flexibility necessary for the Group’s future business development when investment opportunities are identified; and (ii) is able to facilitate to strengthen the capital base and financial position of the Company.

Financial flexibility

As debt financing may incur interest burden to the Group, equity financing is considered an important avenue of resources to the Company and an appropriate mean to provide additional working capital for the future development and expansion of the Group. The Directors advised that there is no definite plan for any investment nor is there any immediate funding need for the operation and/or development of the Group. The Directors believe that the Refreshed Mandate will provide the Group with flexibility for possible future fund raising or attractive terms for investment in the Shares become available from potential investors, and is therefore in the best interests of the Company and the Shareholders as a whole.

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LETTER FROM VEDA CAPITAL

Having considered that (i) the Refreshed Mandate would provide the Company with a financial flexibility for potential investments in the future as and when such opportunities arise; and (ii) the Refreshed Mandate could provide the flexibility to raise equity capital for the Company in a timely manner, we are of the opinion that the Refreshed Mandate would provide the Company with the necessary flexibility to fulfill any possible funding needs for future business development and/or investment decisions, and is in the interests of the Company and the Independent Shareholders as a whole.

Other financing alternatives

Other financing methods such as debt financing or internal cash resources to fund further business of the Company shall be taken into consideration in appropriate circumstances.

The Directors confirmed that they would exercise due and careful consideration when choosing the best financing method available to the Group. With this being the case, along with the fact that the Refreshed Mandate will provide the Company with an additional alternative and it is reasonable for the Company to have the flexibility in deciding the financing methods for its future business development, we are of the view that the Refreshed Mandate is in the interests of the Company and the Independent Shareholders as a whole.

Potential dilution effect on the shareholding structure

The table below sets out the shareholding structure of the Company (i) as at the Latest Practicable Date; (ii) immediately upon completion of the Bonus Issue and (ii) immediately upon completion of the Bonus Issue and upon full utilisation of the Refreshed Mandate (assuming no other Shares are issued or repurchased by the Company during the period between the Latest Practicable Date and the date of the 2nd SGM):

Ms. Siu York Chee and her associates_(Note 1) Mr. Leung Kwok Kui(Note 2)_ Independent Shareholders Additional Shareholders upon full utilization of the Refreshed Mandate Total:	As at the Latest Practicable Date Shares % 18,421,142 3.89 286 0.00 455,666,832 96.11 – – 474,088,260 100.00	Immediately upon completion of the Bonus Issue Shares % 92,105,710 3.89 1,430 0.00 2,278,334,160 96.11 – – 2,370,441,300 100.00	Immediately upon completion of the Bonus Issue and upon full utilisation of the Refreshed Mandate Shares % 92,105,710 3.24 1,430 0.00 2,278,334,160 80.09 474,088,260 16.67 2,844,529,560 100.00	Immediately upon completion of the Bonus Issue and upon full utilisation of the Refreshed Mandate Shares % 92,105,710 3.24 1,430 0.00 2,278,334,160 80.09 474,088,260 16.67 2,844,529,560 100.00
				100.00

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LETTER FROM VEDA CAPITAL

Notes

Such interest excludes that of Mr. Leung Kwok Kui, an executive Director and the spouse of Ms. Siu York Chee.
Such interest excludes that of Ms. Siu York Chee, an executive Director and the spouse of Mr. Leung Kwok Kui.

As set out above, assuming the completion of the Bonus Issue, the aggregate shareholding of the Independent Shareholders will be decreased from approximately 96.11% to approximately 80.09% upon full utilization of the Refreshed Mandate. Although the shareholdings of all Shareholders will be diluted in proportion to their respective interests in the Company upon exercise of the Refreshed Mandate, it may provide a flexible financing option to the Company. Under such circumstances, we consider that the potential dilution to the shareholdings of the Shareholders to be acceptable.

Recommendation

Having considered the above factors and reasons, we are of the opinion that the terms of the Refreshed Mandate are on normal commercial terms and is in the ordinary and usual course of business of the Company and fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Independent Shareholders as a whole. Accordingly, we recommend the Independent Shareholders and the Independent Board Committee to advise the Independent Shareholders to vote in favour of the relevant resolutions to be proposed at the 2nd SGM to approve the Refreshed Mandate.

Yours faithfully, For and on behalf of Veda Capital Limited Hans Wong Julisa Fong Managing Director Executive Director

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Appendix

1. memorAndum of continuAnce

The Memorandum of Continuance to be adopted by the Company will state, inter alia, that the liability of members of the Company is limited to the amount, if any, for the time being unpaid on the shares held by the members and that the Company is an exempted company as defined in the Companies Act. The Memorandum of Continuance will also sets out the objects and powers of the Company. As an exempted company, the Company will be carrying on business outside Bermuda from a place of business in Bermuda.

In accordance with and subject to section 42A of the Companies Act, the Memorandum of Continuance of the Company will empower the Company to purchase its own shares and this power is exercisable by the Board upon such terms and subject to such conditions as it thinks fit.

2. Bye-lAWs

The following is a summary of certain provisions of the Bye-laws to be adopted by the Company with effect from the date that the Company is continued into Bermuda.

a. shares

(i) Classes of Shares

The share capital of the Company consists of ordinary shares.

(ii) Share Certificates

Every certificate for shares, warrants or debentures or representing any other form of securities of the Company shall be issued under the seal of the Company, which for this purpose may be a securities seal. In relation to the use of the securities seal for sealing certificates for shares or other securities of the Company, no signature of any Director, officer or other person and no mechanical reproduction thereof shall be required on any such certificates or other document and any such certificates or other document to which such securities seal is affixed shall be valid and deemed to have been sealed and executed with the authority of the Board notwithstanding the absence of any such signature or mechanical reproduction as aforesaid.

The Company shall not be bound to register more than four persons as joint holders of any share.

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b. directors

(i) Power to allot and issue shares

Without prejudice to any special rights or restrictions for the time being attaching to any shares or any class of shares, any share may be issued upon such terms and conditions and with such preferred, deferred or other special rights, or such restrictions, whether as regards dividend, voting, return of capital or otherwise, as the Company may from time to time by ordinary resolution determine (or, in the absence of any such determination or so far as the same may not make specific provision, as the Board may determine) and any preference share may, subject to the Companies Act and with the sanction of a special resolution, be issued on terms that it is liable to be redeemed upon the happening of a specified event or upon a given date and either at the option of the Company or, if so authorised by the Memorandum of Continuance of the Company, at the option of the holder. The Board may, subject to the approval of the members in general meeting, issue warrants to subscribe for any class of shares or securities of the Company on such terms as it may from time to time determine.

The Board may, subject to the approval by the members in general meeting, issue warrants to subscribe for any class of shares or securities of the Company on such terms as the Board may from time to time determine. Where warrants are issued to bearer, no certificate thereof shall be issued to replace one that has been lost unless the Board is satisfied beyond reasonable doubt that the original certificate thereof has been destroyed and the Company has received an indemnity in such form as the Board shall think fit with regard to the issue of any such replacement certificate.

Subject to the provisions of the Companies Act and the Bye-laws, and to the permission of the Bermuda Monetary Authority being obtained, all unissued shares in the Company shall be at the disposal of the Board, which may offer, allot, grant options over or otherwise dispose of them to such persons, at such times, for such consideration and generally on such terms as it shall in its absolute discretion think fit, but so that no shares shall be issued at a discount.

(ii) Power to dispose of the assets of the Company or any subsidiary

There are no specific provisions in the Bye-laws relating to the disposal of the assets of the Company or any of its subsidiaries although the Board may exercise all powers and do all acts and things which may be exercised or done or approved by the Company and which are not required by the Bye-laws or the statutes to be exercised or done by the Company in general meeting.

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Appendix

(iii) Compensation or payments for loss of office

Payments to any Director or past Director of the Company of any sum by way of compensation for loss of office or as consideration for or in connection with his retirement from office (not being a payment to which the Director is contractually entitled) must be approved by the Company in general meeting.

(iv) Loans to Directors

There are no provisions in the Bye-laws relating to the making of loans to Directors. However, the Companies Act contains restrictions on companies making loans to their directors, the relevant provisions of which are summarized in section 4(n) of this Appendix.

(v) Financial assistance to acquire shares of the Company
(aa) Subject, where applicable, to the rules of any relevant stock exchange, the Company may in accordance with an employees’ share scheme approved by the members in general meeting provide money on such terms as the Board thinks fit for the acquisition of fully or partly paid shares in the Company or its holding company. An employees’ share scheme is a scheme for encouraging or facilitating the holding of shares or debentures in the Company by or for the benefit of the bona fide employees or former employees (including, notwithstanding section 96 of the Companies Act, any such bona fide employee or former employee who is or was also a Director) of the Company, the Company’s subsidiary or holding company or a subsidiary of the Company’s holding company, or the wives, husbands, widows, widowers or children or step-children under the age of twenty-one of such employees or former employees;
(bb) Subject, where applicable, to the rules of any relevant stock exchange, the Company, the Company’s subsidiary or holding company or a subsidiary of the Company’s holding company may make loans to persons (including, notwithstanding section 96 of the Companies Act, any such bona fide employee or former employee who is or was also a Director) employed in good faith by the Company with a view to enabling those persons to acquire fully or partly paid shares in the Company or its holding company to be held by them by way of beneficial ownership; and
(cc) The conditions subject to which money and loans are provided may include a provision to the effect that when an employee ceases to be employed by the Company, the shares acquired with such financial assistance shall or may be sold to the Company or such other company on such terms as the Board thinks fit.
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Appendix

(vi) Disclosure of interests in contracts with the Company or any of its subsidiaries

Subject to the Companies Act, a Director may hold any other office or place of profit with the Company (except that of Auditor) in conjunction with his office of Director for such period and upon such terms as the Board may determine, and may be paid such extra remuneration therefor (whether by way of salary, commission, participation in profits or otherwise) as the Board may determine. A Director of the Company may be or become a director or other officer of, or be otherwise interested in, any company promoted by the Company or any other company in which the Company may be interested, and shall not be liable to account to the Company or the members for any remuneration, profit or other benefit received by him as a director or officer of or from his interest in such other company. The Board may also cause the voting power conferred by the shares in any other company held or owned by the Company to be exercised in such manner in all respects as it thinks fit, including the exercise thereof in favour of any resolution appointing the Directors or any of them to be directors or officers of such other company, or voting or providing for the payment of remuneration to the directors or officers of such other company. A Director shall not vote or be counted in the quorum on any resolution of the Board concerning his own appointment as the holder of any office or place of profit with the Company or any other company in which the Company is interested (including the arrangement or variation of the terms thereof, or the termination thereof).

Subject to the provisions of the Companies Act and the Bye-laws, no Director or proposed or intended Director shall be disqualified by his office from contracting with the Company, either with regard to his tenure of any office or place of profit or as vendor, purchaser or in any other manner whatsoever, nor will any such contract or any other contract or arrangement in which any Director is in any way interested be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company or the members for any remuneration, profit or other benefits realised by any such contract or arrangement by reason of such Director holding that office or the fiduciary relationship thereby established. A Director who to his knowledge is in any way, whether directly or indirectly, interested in a contract or arrangement or proposed contract or arrangement with the Company must declare the nature of his interest at the meeting of the Board at which the question of entering into the contract or arrangement is first taken into consideration, if he knows his interest then exists, or in any other case at the first meeting of the Board after he knows that he is or has become so interested.

Save as otherwise provided by the Bye-laws, a Director shall not vote (nor shall he be counted in the quorum) on any resolution of the Board in respect of any contract or arrangement in which he or any of his associates has a material interest, and if he does so his vote shall not be counted, but this prohibition will not apply to any of the following matters namely:

(aa) any contract or arrangement for the giving by the Company of any security or indemnity to the Director or his associate(s) in respect of money lent or obligations incurred or undertaken by him or any of them at the request of or for the benefit of the Company and any of its subsidiaries;
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(bb) any contract or arrangement for the giving by the Company of any security to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director or his associate(s) has himself/themselves assumed responsibility or guaranteed or secured in whole or in part whether solely or jointly;
(cc) any contract or arrangement concerning an offer of the shares, debentures or other securities of or by the Company or any other company which the Company may promote or be interested in for subscription or purchase where the Director or his associate(s) is/are or is/are to be interested as a participant in the underwriting or sub-underwriting of the offer;
(dd) any contract or arrangement in which the Director or his associate(s) is/are interested in the same manner as other holders of shares or debentures or other securities of the Company by virtue only of his/their interest in shares or debentures or other securities of the Company;
(ee) any contract or arrangement concerning any other company in which the Director or his associate(s) is/are interested only, whether directly or indirectly, as an officer or executive or member or in which the Director or his associate(s) is/are beneficially interested in shares of that company, provided that the Director and any of his associates are not in aggregate beneficially interested in five (5) per cent or more of the issued shares of any class of shares of such company (or of any third company through which his interest or that of his associates is derived) or of the voting rights;
(ff) any proposal or arrangement for the benefit of employees of the Company or its subsidiaries including the adoption, modification or operation of a pension fund or retirement, death or disability benefit scheme which relates both to Directors, his associate(s) and employees of the Company or any of its subsidiaries and does not give the Director or his associate(s), as such any privilege not generally accorded to the class of persons to whom such scheme or fund relates; and
(gg) any proposal or arrangement concerning the adoption, modification or operation of any employee’s share scheme involving the issue or grant of options over shares or other securities by the Company to, or for the benefit of, the employees of the Company or its subsidiaries under which the Director or his associate(s) may benefit.
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Appendix

(vii) Remuneration

The Directors shall be entitled to receive by way of remuneration for their services such sum as is from time to time determined by the Company in general meeting, such sum (unless otherwise directed by the resolution by which it is voted) to be divided amongst the Directors in such proportions and in such manner as the Board may agree, or failing agreement, equally, except that in such event any Director holding office for less than the whole of the relevant period in respect of which the remuneration is paid shall only rank in such division in proportion to the time during such period for which he has held office. The foregoing provisions shall not apply to a Director who holds any salaried employment or office in the Company except in the case of sums paid in respect of Directors’ fees. The Directors shall also be entitled to be repaid all travelling, hotel and other expenses reasonably incurred by them respectively in or about the performance of their duties as Directors, including their expenses of travelling to and from board meetings, committee meetings or general meetings, or otherwise incurred whilst engaged on the business of the Company or in the discharge of their duties as Directors. The Board may grant special remuneration to any Director, who being called upon, performs any special or extra services to or at the request of the Company. Such special remuneration may be made payable to such Director in addition to or in substitution for his ordinary remuneration as a Director, and may be made payable by way of salary, commission or participation in profits or otherwise as may be arranged. Notwithstanding the foregoing the remuneration of a managing director, joint managing director, deputy managing director or other executive director or a Director appointed to any other office in the management of the Company may be fixed from time to time by the Board and may be by way of salary, commission or participation in profits or otherwise or by all or any of those modes and with such other benefits (including pension (and/or gratuity) and/or other benefits on retirement) and allowances as the Board may from time to time decide. Such remuneration is in addition to his remuneration as a Director.

The Board also has power to establish and maintain or procure the establishment and maintenance of any contributory or non-contributory pension or superannuation funds for the benefit of, or to give or procure the giving of donations, gratuities, pensions, allowances or emoluments to, any persons who are or were at any time in the employment or service of the Company, or of any company which is a subsidiary of the Company, or is allied or associated with the Company or with any such subsidiary company, or who are or were at any time Directors or officers of the Company or of any such other company as aforesaid, and holding or who have held any salaried employment or office in the Company or such other company, and the spouses, widows, widowers, families and dependents of any such persons and may make payments for or towards the insurance of any such persons. Any Director holding any such employment or office is entitled to participate in and retain for his own benefit any such donation, gratuity, pension, allowance or emolument.

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(viii) Retirement, appointment and removal

At each annual general meeting one-third of the Directors for the time being (or if their number is not three or a multiple of three, then the number nearest one-third) will retire from office by rotation. The Directors to retire in every year will be those who have been longest in office since their last election but as between persons who became Directors on the same day those to retire shall (unless they otherwise agree between themselves) be determined by lot.

No person, other than a retiring Director, shall, unless recommended by the Board for election, be eligible for election to the office of Director at any general meeting, unless notice in writing of the intention to propose that person for election as a Director and notice in writing by that person of his willingness to be elected shall have been lodged at the head office or at the registration office at least seven days before the date of the general meeting.

Directors of the Company are entitled to attend and speak at all general meetings.

The number of Directors shall not be less than two. A Director may be removed by a special resolution of the Company before the expiration of his period of office (but without prejudice to any claim which such Director may have for damages for breach of any contract of service between him and the Company). The Company may from time to time in general meeting by ordinary resolution elect any person to be a Director either to fill a casual vacancy or as an addition to the Board. Any Director so appointed shall hold office only until the next general meeting of the Company and shall then be eligible for re-election at the meeting.

There is no shareholding qualification for Directors nor is there any specified age limit for Directors.

The Board may from time to time entrust to and confer upon a managing director, joint managing director, deputy managing director or executive director all or any of the powers of the Board that it may think fit provided that the exercise of all powers by such Director shall be subject to such regulations and restrictions as the Board may from time to time make and impose. The Board may delegate any of its powers to committees consisting of such member or members of its body and such other persons as the Board thinks fit, and it may from time to time revoke such delegation or revoke the appointment of and discharge any such committees either wholly or in part, and either as to persons or purposes, but every committee so formed shall in the exercise of the powers so delegated conform to any regulations that may from time to time be imposed upon it by the Board.

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Appendix

(ix) Borrowing powers

Subject to the provisions of the Companies Act, the Board may from time to time at its discretion exercise all the powers of the Company to raise or borrow or to secure the payment of any sum or sums of money for the purposes of the Company and to mortgage or charge its undertaking, property and uncalled capital or any part thereof. The Board may raise or secure the payment or repayment of such sum or sums in such manner and upon such terms and conditions in all respects as it thinks fit and in particular by the issue of debentures, debenture stock, bonds or other securities of the Company, whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

c. Alterations to constitutional documents

The Memorandum of Continuance of the Company may, with the consent of the Minister of Finance of Bermuda (the “Minister”), be altered by the Company in general meeting. The Bye-laws may be amended by the Directors subject to the approval of the Company in general meeting. The Bye-laws state that a special resolution is required to alter the Memorandum of Continuance, to approve any amendment of the Bye-laws or to change the name of the Company.

d. Alterations of capital

The Company may from time to time by ordinary resolution:

(i) increase its share capital by the creation of new shares;
(ii) consolidate or divide all or any of its share capital into shares of larger amount than its existing shares; on any consolidation of fully paid shares into shares of larger amount, the Board may settle any difficulty which may arise as it thinks expedient and in particular (but without prejudice to the generality of the foregoing) may, as between the holders of the shares to be consolidated, determine which particular shares are to be consolidated into each consolidated share, and if it shall happen that any person shall become entitled to fractions of a consolidated share or shares, such fractions may be sold by some person appointed by the Board for that purpose and the person so appointed may transfer the shares so sold to the purchaser thereof and the validity of such transfer shall not be questioned, and so that the net proceeds of such sale (after deduction of the expenses of such sale) may either be distributed among the persons who would otherwise be entitled to a fraction or fractions of a consolidated share or shares ratably in accordance with their rights and interests or may be paid to the Company for the Company’s benefit;
(iii) divide its shares into several classes and attach thereto respectively any preferential, deferred, qualified or special rights, privileges or conditions;
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(iv) cancel any shares which at the date of the passing of the resolution have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the shares so cancelled;
(v) sub-divide its shares or any of them into shares of smaller amount than is fixed by the Memorandum of Continuance, subject nevertheless to the Companies Act, and so that the resolution whereby any shares is sub-divided may determine that, as between the holders of the shares resulting from such sub-division, one or more of the shares may have any such preferred or other special rights over, or may have such deferred rights or be subject to any such restrictions as compared with the others as the Company has power to attach to unissued or new shares;
(vi) change the currency denomination of its share capital; and
(vii) subject to applicable regulatory requirements, make provision for the issue and allotment of shares which do not carry any voting rights.

The Company may by special resolution reduce its share capital, any capital redemption reserve fund or any share premium account or other undistributable reserve in any manner authorised and subject to any conditions prescribed by law.

e. Variation of rights of existing shares or classes of shares

If at any time the capital is divided into different classes of shares, all or any of the special rights (unless otherwise provided for by the terms of issue of that class) attached to any class may, subject to the provisions of the Companies Act, be varied or abrogated either with the consent in writing of the holders of not less than three-fourths in nominal value of the issued shares of that class or with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of that class. To every such separate general meeting the provisions of the Bye-laws relating to general meetings will mutatis mutandis apply, but so that the necessary quorum is not less than two persons holding or representing by proxy one-third in nominal value of the issued shares of the class, and that any holder of shares of the class present in person or by proxy or by a duly authorised corporate representative may demand a poll.

f. special resolutions – majority required

A special resolution of the Company must be passed by a majority of not less than threefourths of the votes cast of such members as, being entitled so to do, vote in person or, where a corporate representative is allowed, by a duly authorised corporate representative or, where proxies are allowed, by proxy at a general meeting of which not less than 21 days’ notice, specifying the intention to propose the resolution as a special resolution, has been duly given. However, if it is so agreed by a majority in number of the members having a right to attend and vote at such meeting, being a majority together holding not less than 95 per cent in nominal value of the shares giving that right, a resolution may be proposed and passed as a special resolution at a meeting of which less than 21 days’ notice has been given.

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g. Voting rights and right to demand a poll

Subject to any special rights, privileges or restrictions as to voting for the time being attached to any class or classes of shares, at any general meeting on a show of hands every member who is present in person or by a duly authorised corporate representative or by proxy shall have one vote and on a poll, every member present in person or by a duly authorised corporate representative or by proxy shall have one vote for every share of which he is the holder which is fully paid up or credited as fully paid (but so that no amount paid up or credited as paid up on a share in advance of calls or instalments is treated for the foregoing purposes as paid up on the share). On a poll, a member entitled to more than one vote need not use all his votes or cast all the votes in the same way.

At any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) demanded by (i) the Chairman of the meeting; or (ii) by at least three members present in person or by proxy or by a duly authorised corporate representative for the time being entitled to vote at the meeting; or (iii) by any member or members present in person or by proxy or by a duly authorised corporate representative and representing not less than one-tenth of the total voting rights of all the members having the right to vote at the meeting; or (iv) by a member or members present in person or by proxy or by a duly authorised corporate representative 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 the shares conferring that right.

h. requirements for annual general meetings

An annual general meeting must be held once in every year and within not more than fifteen months after the last preceding annual general meeting.

i. Accounts and audit

The Board shall cause true accounts to be kept of the sums of money received and expended by the Company, and the matters in respect of which such receipts and expenditure take place, and of the property, assets, credits and liabilities of the Company and of all other matters required by the Companies Act affecting the Company or necessary to give a true and fair view of the state of the Company’s affairs and to show and explain its transactions.

The books of account are to be kept at the head office or at such other place as the Board thinks fit and shall always be open to the inspection of the Directors provided that such records as are required by the Companies Act shall also be kept at the registered office. No member (not being a Director) or other person has any right to inspect any account or book or document of the Company except as conferred by the Companies Act or ordered by a court of competent jurisdiction or authorised by the Board or by the Company in general meeting.

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The Board shall from time to time cause to be prepared and laid before the Company at its annual general meeting such profit and loss accounts, balance sheets, group accounts (if any) and reports as are required by the Companies Act. Every balance sheet of the Company shall be signed on behalf of the Board by two Directors and a copy of every balance sheet (including every document required by law to be comprised therein or attached or annexed thereto) and profit and loss account which is to be laid before the Company at its annual general meeting, together with a copy of the Directors’ report and a copy of the auditors’ report, shall not less than twenty-one days before the date of the meeting, be sent to every member of, and every holder of debentures of, the Company and every other person entitled to receive notices of general meetings of the Company under the Companies Act or of the Bye-laws. If all or any of the shares or debentures of the Company are for the time being (with the consent of the Company) listed or dealt in on any stock exchange, there shall be forwarded to the appropriate officer of such stock exchange such number of copies of such documents as may for the time being required under its regulations or practice.

Auditors shall be appointed and their duties regulated in accordance with the Companies Act. Subject as otherwise provided by such provisions the remuneration of the auditors shall be fixed by or on the authority of the Company at each annual general meeting, but in respect of any particular year, the Company in general meeting may delegate the fixing of such remuneration to the Board.

j. notices of meetings and business to be conducted thereat

An annual general meeting and any special general meeting at which it is proposed to pass a special resolution must be called by twenty-one days’ notice in writing at least and any other special general meeting shall be called by at least fourteen days’ notice in writing (in each case exclusive of the day on which the notice is served or deemed to be served and of the day for which it is given). The notice shall specify the place, the day and the hour of meeting and, in the case of special business, the general nature of that business.

Any notice or document to be given or issued under the Bye-laws shall be in writing, and may be served by the Company on any member either personally or by sending it through the post in a prepaid envelope or wrapper addressed to such member at his registered address as appearing in the Company’s register of members or by delivering or leaving it at such registered address as aforesaid or (in the case of a notice) by advertisement in the newspapers. Any member whose registered address is outside Hong Kong may notify the Company in writing of an address in Hong Kong which for the purpose of service of notice shall be deemed to be his registered address. Where the registered address of the member is outside Hong Kong, notice, if given through the post, shall be sent by prepaid airmail letter.

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k. transfer of shares

All transfers of shares must be effected by transfer in writing in the usual or common form or in any other form acceptable to the Board and may be under hand or by means of mechanically imprinted signatures or such other manner as the Board may from time to time approve. An instrument of transfer must be executed by or on behalf of the transferor and by or on behalf of the transferee and the transferor shall be deemed to remain the holder of the share until the name of the transferee is entered in the register of members in respect thereof.

The Board may, in its absolute discretion, at any time and from time to time transfer any share upon the principal register to any branch register or any share on any branch register to the principal register or any other branch register.

Unless the Board otherwise agrees, no shares on the principal register shall be transferred to any branch register nor shall shares on any branch register be transferred to the principal register or any other register. All transfers and other documents of title must be lodged for registration and registered, in the case of shares on a branch register, at the relevant registration office and, in the case of shares on the principal register, at the transfer office in Bermuda.

The Board may in its absolute discretion and without assigning any reason therefore, refuse to register any transfer of any shares (not being fully paid shares) to a person of whom it does not approve and it may refuse to register the transfer of any shares (not being fully paid shares) on which the Company has a lien. The Board may also refuse to register a transfer of shares (whether fully paid or not) in favour of more than four persons jointly. If the Board refuses to register a transfer, it will within two months after the date on which the transfer was lodged with the Company send to the transferor and transferee notice of the refusal.

The Board may decline to recognise any instrument of transfer unless a fee of such sum as the Stock Exchange may determine to be payable or such lesser sum as the Board may from time to time determine is paid to the Company in respect thereof has been paid, the shares are free of any lien in favour of the Company, the instrument of transfer is properly stamped, is in respect of only one class of share and is lodged at the relevant registration or transfer office accompanied by the relevant share certificate(s) and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer (and if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do). Where applicable, the permission of the Bermuda Monetary Authority with respect thereto shall be obtained.

The registration of transfers may, on giving notice by advertisement in an appointed newspaper in Bermuda and in one or more newspapers circulating in Hong Kong, be suspended at such times and for such periods as the Board may from time to time determine and either generally or in respect of any class of shares. The register of members shall not be closed for more than thirty days in any year.

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Fully paid Shares shall be free from any restriction with respect to the right of the holder thereof to transfer such Shares (except when permitted by the Stock Exchange) and shall also be free from all liens.

l. power for the company to purchase its own shares

The Bye-laws give the Board the power to determine the terms and conditions subject to which this power is to be exercised.

m. power of any subsidiary of the company to own shares in the company

There are no provisions in the Bye-laws relating to ownership of the Company by a subsidiary.

n. dividends and other methods of distribution

The Company in general meeting may declare dividends in any currency but no dividends shall exceed the amount recommended by the Board.

Unless and to the extent that the rights attached to any shares or the terms of issue thereof otherwise provide, all dividends will be apportioned and paid pro rata according to the amounts paid or credited as paid up on the shares during any portion or portions of the period in respect of which the dividend is paid. No amount paid upon a share in advance of calls will for this purpose be treated as paid up on the shares. The Board may retain any dividends or other moneys payable on or in respect of a share upon which the Company has a lien, and may apply the same in or towards satisfaction of the debts, liabilities or engagements in respect of which the lien exists. The Board may deduct from any dividend or bonus payable to any member all sums of money (if any) presently payable by him to the Company on account of calls, instalments or otherwise.

Whenever the Board or the Company in general meeting has resolved that a dividend be paid or declared on the share capital of the Company, the Board may further resolve either (a) that such dividend be satisfied wholly or in part in the form of an allotment of shares credited as fully paid up, provided that the members entitled thereto will be entitled to elect to receive such dividend (or part thereof) in cash in lieu of such allotment, or (b) that the members entitled to such dividend will be entitled to elect to receive an allotment of shares credited as fully paid up in lieu of the whole or such part of the dividend as the Board may think fit. The Company may also upon the recommendation of the Board by a special resolution resolve in respect of any one particular dividend of the Company that it may be satisfied wholly in the form of an allotment of shares credited as fully paid up without offering any right to members to elect to receive such dividend in cash in lieu of such allotment.

Whenever the Board or the Company in general meeting has resolved that a dividend be paid or declared the Board may further resolve that such dividend be satisfied wholly or in part by the distribution of specific assets of any kind.

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The Board may, if it thinks fit, receive from any member willing to advance the same, and either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any Shares held by him, and in respect of all or any of the moneys so advanced may pay interest at such rate (if any) not exceeding 20% per annum, as the Board may decide but a payment in advance of a call shall not entitle the member to receive any dividend or to exercise any other rights or privileges as a member in respect of the Share or the due portion of the Shares upon which payment has been advanced by such member before it is called up.

All dividends or bonuses unclaimed for one year after having been declared may be invested or otherwise made use of by the Board for the benefit of the Company until claimed and the Company shall not be constituted a trustee in respect thereof. All dividends or bonuses unclaimed for six years after having been declared may be forfeited by the Board and shall revert to the Company.

The Company may exercise the power to cease sending cheques for dividend entitlements or dividend warrants by post if such cheques or warrants have been left uncashed on 2 consecutive occasions or after the first occasion on which such a cheque or warrant is returned undelivered.

o. proxies

Any member of the Company entitled to attend and vote at a meeting of the Company or a meeting of the holders of any class of shares in the Company is entitled to appoint another person as his proxy to attend and vote instead of him. Votes, whether on a show of hands or on a poll may be given either personally or by a duly authorised corporate representative or by proxy. A member holding two or more shares may appoint more than one proxy to attend on the same occasion. A proxy need not be a member of the Company.

The 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 seal or under the hand of an officer or attorney duly authorised.

The instrument appointing a proxy to vote at a general meeting shall: (i) be deemed to confer authority upon the proxy to demand or join in demanding a poll and to vote on any resolution (or amendment thereto) put to the meeting for which it is given as the proxy thinks fit. Provided that any form issued to a member for use by him for appointing a proxy to attend and vote at a special general meeting or at an annual general meeting at which any business is to be transacted shall be such as to enable the member, according to his intentions, to instruct the proxy to vote in favour of or against (or, in default of instructions, to exercise his discretion in respect of) each resolution dealing with any such business; and (ii) unless the contrary is stated therein, be valid as well for any adjournment of the meeting as for the meeting to which it relates.

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Where that member is a recognised clearing house within the meaning of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), it may appoint such person or persons as it thinks fit to act as its proxy or proxies or as its corporate representative or representatives, to the extent permitted by the Companies Act, at any members’ general meeting or any meeting of any class of members provided that if more than one proxy or corporate representative is so appointed, the appointment shall specify the number and class of shares in respect of which each such proxy or corporate representative is to be appointed. The person so appointed will be entitled to exercise the same powers on behalf of the clearing house (or its nominee) which he represents as that clearing house (or its nominee) could exercise as if it were an individual member of the Company including the right to vote individually on a show of hands. The number of persons a clearing house may appoint to act as its corporate representative or representatives shall not exceed the number of shares held by the clearing house (or its nominee), being shares in respect of which there is an entitlement to attend and vote at the relevant meeting.

In addition, a proxy or proxies representing either an individual member or a member which is a corporation, shall be entitled to exercise the same powers on behalf of the member which he or they represent as such member could exercise including the right to vote individually on a show of hands.

p. calls on shares and forfeiture of shares

The Board may from time to time make such calls as it may think fit upon the members in respect of any monies unpaid on the shares held by them respectively (whether on account of the nominal value of the shares or by way of premium) and not by the conditions of allotment thereof made payable at fixed times. A call may be made payable either in one sum or by instalments. If the sum payable in respect of any call or instalment is not paid on or before the day appointed for payment thereof, the person or persons from whom the sum is due shall pay interest on the same at such rate not exceeding 20 per cent per annum as the Board shall fix from the day appointed for the payment thereof to the time of actual payment, but the Board may waive payment of such interest wholly or in part. The Board may, if it thinks fit, receive from any member willing to advance the same, either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and upon all or any of the monies so advanced the Company may pay interest at such rate (if any) not exceeding 20 per cent per annum as the Board may decide.

If a member fails to pay any call or instalment of a call on the day appointed for payment thereof, the Board may, at any time thereafter during such time as any part of the call or instalment remains unpaid, serve a notice on him requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued and which may still accrue up to the date of actual payment. The notice will name a further day (not earlier than the expiration of fourteen days from the date of the notice) on or before which the payment required by the notice is to be made, and it will also name the place where payment is to be made, such place being either the registered office of the Company, or some other place at which calls of the Company are usually made payable. The notice shall also state that, in the event of non-payment at or before the time appointed, the shares in respect of which the call was made will be liable to be forfeited.

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If the requirements of any such notice are not complied with, any share in respect of which the notice has been given may at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of the Board to that effect. Such forfeiture will include all dividends and bonuses declared in respect of the forfeited share and not actually paid before the forfeiture.

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, notwithstanding, remain liable to pay to the Company all moneys which, at the date of forfeiture, were payable by him to the Company in respect of the shares together with (if the Board shall in its discretion so require) interest thereon from the date of forfeiture until payment at such rate not exceeding 20 per cent per annum as the Board may prescribe.

q. inspection of register of members

There are no provisions in the Bye-laws relating to inspection of the register of members.

r. Quorum for meetings and separate class meetings

For all purposes the quorum for a general meeting shall be two members present in person or by a duly authorised corporate representative or by proxy and entitled to vote. In respect of a separate class meeting convened to sanction the modification of class rights, the necessary quorum shall not be less than two persons holding or representing by proxy or by a duly authorised corporate representative one-third in nominal value of the issued shares of that class.

s. rights of the minorities in relation to fraud or oppression

There are no provisions in the Bye-laws relating to rights of minority members in relation to fraud or oppression. However, Bermuda company law provides for protection of minorities, as summarised in paragraph 4(o) of this Appendix.

t. procedures on liquidation

A resolution that the Company be wound up by the court or be wound up voluntarily must be a special resolution.

If the Company shall be wound up, the surplus assets remaining after payment to all creditors are to be divided among the members in proportion to the capital paid up on the shares held by them respectively, and if such surplus assets shall be insufficient to repay the whole of the paid up capital, they are to be distributed so that, as nearly as may be, the losses shall be borne by the members in proportion to the capital paid up on the shares held by them respectively, all subject to the rights of any shares issued on special terms and conditions.

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If the Company shall be wound up (whether the liquidation is voluntary or by the court) the liquidator may, with the sanction of a special resolution, divide among the members in specie or kind the whole or any part of the assets of the Company and whether the assets consist of property of one kind or consists of properties of different kinds and the liquidator may, for such purposes, set such value as he deems fair upon any one or more class or classes of property to be divided as aforesaid and may determine how such division is to be carried out as between the members or different classes of members and the members within each class. Under the Companies Act the liquidator may, with the like sanction, vest any one or more class or classes of property and may determine how such division shall be carried out as between the members or different classes of members. Under the Companies Act, the liquidator may, with like sanction, vest any part of the assets in trustees upon such trusts for the benefit of members as the liquidator, with the like sanction shall think fit, but so that no member shall be compelled to accept any shares or other assets upon which there is a liability.

u. stock

The Company may by ordinary resolution convert any fully paid up shares into stock, and may from time to time by like resolution reconvert any stock into fully paid up shares of any denominations. The holders of stock may transfer the same or any part thereof in the same manner, and subject to the same regulations as and subject to which the shares from which the stock arose might prior to conversion have been transferred or as near thereto as circumstances admit, but the Board may from time to time, if it thinks fit, fix the minimum amount of stock transferable and restrict or forbid the transfer of fractions of that minimum, but so that such minimum shall not exceed the nominal amount of the shares from which the stock arose. No warrants to bearer shall be issued in respect of any stock. The holders of stock shall, according to the amount of the stock held by them, have the same rights, privileges and advantages as regards dividends, participation in assets on a winding-up, voting at meetings and other matters, as if they held the shares from which the stock arose, but no such privilege of the Company shall be conferred by an amount of stock which would not, if existing in shares, have conferred such privilege or advantage. All such of the provisions of the Bye-laws as are applicable to paid up shares shall apply to stock, and the words “share” and “member” therein shall include “stock” and “stockholder”.

v. untraceable members

The Company shall have the power to sell, in such manner as the Board thinks fit, any shares of a member who is untraceable, but no such sale shall be made unless:

i) all cheques or warrants, being not less than three in total number, for any sum payable in cash to the holder of such shares in respect of them sent during the relevant period in the manner authorised by the Bye-Laws of the Company have remained uncashed;
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ii) so far as it is aware at the end of the relevant period, the Company has not at any time during the relevant period received any indication of the existence of the member who is the holder of such shares or of a person entitled to such shares by death, bankruptcy or operation of law;
iii) the Company has caused an advertisement to be inserted in the newspapers of its intention to sell such shares and a period of three months has elapsed since the date of such advertisement; and
iv) the Company has notified the Stock Exchange of its intention to effect such sale.

w. other provisions

The Bye-laws provide that, subject to the Companies Act, if any of the rights attached to any warrants issued by the Company shall remain exercisable and the Company does any act which would result in the subscription price under such warrants being reduced below the par value of a share, a subscription right reserve shall be established and applied in paying up the difference between the subscription price and the par value of a share on any exercise of the warrants.

Note: The Companies Act prevents a company from giving financial assistance in the subscription of its shares (subject to certain exceptions). A subscription right reserve may only be created and used for the above purpose if an exception applies.

3. VAriAtion of memorAndum of continuAnce And Bye-lAWs

The Memorandum of Continuance of the Company may be altered by the Company in general meeting and if the Company intends to carry on any “restricted business activity” for the purposes of the Companies Act, the prior consent of the Minister will also be required. The Bye-laws may be amended by the Board subject to the approval of the Company in general meeting. The Bye-laws state that a special resolution shall be required to alter provisions of the Memorandum of Continuance, to approve any amendment of the Bye-laws or to change the name of the Company. For these purposes a resolution is a special resolution if it has been passed by a majority of not less than three-fourths of the votes cast of such members of the Company as, being entitled so to do, vote in person or, by a duly authorised corporate representative or, where permitted, by proxy at a general meeting of which not less than 21 days’ notice specifying the intention to propose the resolution as a special resolution has been duly given. The requirement of 21 days’ notice may be waived (a) in the case of a special general meeting, by a majority number of the members having the right to attend and vote at the relevant meeting, being a majority holding not less than 95 per cent. in nominal value of the shares giving that right; and (b) in the case of an annual general meeting, if it is so agreed by all members entitled to attend and vote thereat.

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NOTICE OF THE 1ST SGM

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

(Continued into Bermuda with limited liability)

(Stock Code: 8079)

NOTICE IS HEREBY GIVEN THAT a special general meeting (the “ Meeting ”) of B.A.L. Holdings Limited (the “ Company ”) will be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Monday, 2 November 2009 at 4:30 p.m. for the purpose of considering and, if thought fit, passing (with or without modification) the following ordinary resolution:

ORDINARY RESOLUTION

“ THAT , subject to and conditional upon the Listing Committee of The Stock Exchange of Hong Kong Limited granting and agreeing to grant listing of and permission to deal in the Bonus Shares (as hereinafter defined):

(a) Upon the recommendation of the directors of the Company (the “ Directors ”), a sum of HK$18,963,530.40 (or such larger sum as may be necessary to give effect to the bonus issue of shares pursuant to this resolutions), being part of the amount standing to the credit of the contributed surplus account and/or share premium account and/or retained earnings account of the Company, be capitalized and accordingly the Directors be and are hereby authorized and directed to apply such sum in paying up in full at par not less than 1,896,353,040 unissued shares (the “ Bonus Shares ”) of HK$0.01 each in the capital of the Company, and that such Bonus Shares shall be allotted, issued and distributed, credited as fully paid up at par, to and amongst those shareholders whose names appear on the register of members of the Company on 2 November 2009 (the “ Record Date ”) on the basis of four Bonus Shares for every one existing issued share of HK$0.01 each in the capital of the Company held by them respectively on the Record Date;
(b) the Bonus Shares to be allotted and issued pursuant to this resolution shall, subject to the memorandum of association and bye-laws of the Company, rank pari passu in all respects with the shares of HK$0.01 each in the capital of the Company in issue on the Record Date, except that they will not rank for the Bonus Shares issuance mentioned in this resolution; and
(c) the Directors be authorized to do all acts and things as may be necessary and expedient in connection with the allotment and issue of the Bonus Shares, including, but not limited to, determining the amount to be capitalized out of the contributed surplus account and/or retained earnings account of the Company and the number of Bonus Shares to be allotted, issued and distributed in the manner referred to in paragraph (a) of this resolution.”

Yours faithfully, For and on behalf of

B.A.L. Holdings Limited Siu York Chee Chairperson

Hong Kong, 13 October 2009

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NOTICE OF THE 1ST SGM

Registered Office: Canon’s Court 22 Victoria Street Hamilton HM 12 Bermuda

Head Office and Principal Place of Business: Room 1401, 14/F. Guardian House 32 Oi Kwan Road Wanchai Hong Kong

Notes:

A form of proxy for use at the Meeting is enclosed herewith.
The 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 any officer or attorney duly authorised.
Any shareholder of the Company entitled to attend and vote at the Meeting convened by the above notice shall be entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a shareholder of the Company.
In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power of attorney or authority, must be deposited at the Company’s branch share registrar in Hong Kong, Tricor Standard Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding of the above Meeting or any adjournment thereof (as the case may be).
Completion and return of the form of proxy will not preclude a shareholder of the Company from attending and voting in person at the Meeting convened or at any adjourned meeting (as the case may be) and in such event, the form of proxy will be deemed to be revoked.
Where there are joint holders of any shares of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such shares as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the Meeting, whether in person or by proxy, the most senior shall alone be entitled to vote. For this purpose, seniority shall be determined by the order in which the names stand on the register of members of the Company in respect of the joint holding.
As at the date of this notice of the 1st SGM, the Board comprises three executive Directors, namely Ms. Siu York Chee, Mr. Leung Kwok Kui and Ms. Leung Ge Yau; and three independent non-executive Directors, namely Mr. Hung Anckes Yau Keung, Dr. Siu Yim Kwan, Sidney and Mr. Tsui Pui Hung, Walter.
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NOTICE OF THE 2ND SGM

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

(Continued into Bermuda with limited liability)

(Stock Code: 8079)

NOTICE IS HEREBY GIVEN THAT a special general meeting (the “ Meeting ”) of B.A.L. Holdings Limited (the “ Company ”) will be held at Room 1401, 14th Floor, Guardian House, 32 Oi Kwan Road, Wanchai, Hong Kong on Thursday, 12 November 2009 at 4:30 p.m. for the purpose of considering and, if thought fit, passing (with or without modification) the following ordinary resolution:

ORDINARY RESOLUTION

“ THAT , to the extent not already exercised, the mandate to issue and allot shares of the Company given to the directors (the “ Directors ”) of the Company at the annual general meeting of the Company held on 22 April 2009 be and is hereby revoked and replaced by the mandate THAT :

(a) subject to paragraph (c) of this resolution, and pursuant to the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited, the exercise by the Directors during the Relevant Period (as hereafter defined) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which might require the exercise of such powers be and is hereby generally and unconditionally approved;
(b) the approval in paragraph (a) of this resolution shall authorize the Directors during the Relevant Period (as defined below) to make or grant offers, agreements and options (including bonds, warrants and debentures convertible into shares of the Company) which might require the exercise of such powers after the end of the Relevant Period;
(c) the aggregate nominal amount of the share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the approval in paragraph (a) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereafter defined); (ii) any Share Option Scheme (as hereafter defined) of the Company; (iii) the exercise of rights of conversion under the terms of any securities which are convertible into shares of the Company or warrants to subscribe for shares of the Company; or (iv) any scrip dividend or other similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares of the Company pursuant to the bye-laws of the Company, shall not exceed 20%. of the issued share capital of the Company as at the date of passing of this resolution and the approval in paragraph (a) of this resolution shall be limited accordingly; and
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NOTICE OF THE 2ND SGM

(d) for the purpose of this resolution, “Relevant Period” means the period from the passing of this resolution until whichever is the earliest of:
(i) the conclusion of the next annual general meeting of the Company;
(ii) the revocation or variation of the authority given under this resolution by an ordinary resolution of the shareholders of the Company in general meeting; and
(iii) the expiration of the period within which the next annual general meeting of the Company is required by the bye-laws of the Company or any applicable laws to be held.

“Rights Issue” means an offer of shares open for a period fixed by the Directors to holders of shares of the Company on the register of members on a fixed record date in proportion to their then holdings of such shares (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of any relevant jurisdiction, or the requirements of any recognised regulatory body or any stock exchange applicable to the Company); and

“Share Option Scheme” means a share option scheme or similar arrangement for the time being, as varied from time to time, adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries and/or other eligible person of shares or rights to acquire shares of the Company.”

Yours faithfully,

For and on behalf of B.A.L. Holdings Limited Siu York Chee Chairperson

Hong Kong, 13 October 2009

Registered Office:

Canon’s Court 22 Victoria Street Hamilton HM 12 Bermuda

Head Office and Principal Place of Business:

Room 1401, 14/F. Guardian House 32 Oi Kwan Road Wanchai Hong Kong

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NOTICE OF THE 2ND SGM

Notes:

A form of proxy for use at the Meeting is enclosed herewith.
The 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 any officer or attorney duly authorised.
Any shareholder of the Company entitled to attend and vote at the Meeting convened by the above notice shall be entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a shareholder of the Company.
In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power of attorney or authority, must be deposited at the Company’s branch share registrar in Hong Kong, Tricor Standard Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding of the above Meeting or any adjournment thereof (as the case may be).
Completion and return of the form of proxy will not preclude a shareholder of the Company from attending and voting in person at the Meeting convened or at any adjourned meeting (as the case may be) and in such event, the form of proxy will be deemed to be revoked.
Where there are joint holders of any shares of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such shares as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the Meeting, whether in person or by proxy, the most senior shall alone be entitled to vote. For this purpose, seniority shall be determined by the order in which the names stand on the register of members of the Company in respect of the joint holding.
As at the date of this notice of the 2nd SGM, the Board comprises three executive Directors, namely Ms. Siu York Chee, Mr. Leung Kwok Kui and Ms. Leung Ge Yau; and three independent non-executive Directors, namely Mr. Hung Anckes Yau Keung, Dr. Siu Yim Kwan, Sidney and Mr. Tsui Pui Hung, Walter.
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AI assistant

Wisdomcome Group Holdings Ltd. — Proxy Solicitation & Information Statement 2009

51257_rns_2009-10-12_f2ae28a7-763c-4a7f-a3c4-c07985d48580.pdf

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

EXPECTED TIMETABLE

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

PROPOSALS FOR BONUS ISSUE OF SHARES AND REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

INTRODUCTION

PROPOSED BONUS ISSUE

Basis of Bonus Issue

Record Date and Closure of Register of Members

Fractions of Bonus Shares

Reasons for the Bonus Issue

Overseas Shareholders

Status of Bonus Shares

LETTER FROM THE BOARD

Conditions of the Bonus Issue

Listing and Dealing

Adjustments to Convertible Notes and Options

Certificates for Bonus Shares

Expected Timetable

REFRESHMENT OF EXISTING MANDATE TO ISSUE SHARES

The Existing Mandate

Reasons for the Refreshment of the Existing Mandate

The Refreshed Mandate

Equity Fund Raising Activities in the Past Twelve Months

GENERAL

SGM

INDEPENDENT BOARD COMMITTEE

DOCUMENTS AVAILABLE FOR INSPECTION

RESPONSIBILITY STATEMENT

RECOMMENDATION

ADDITIONAL INFORMATION

B.A.L. HOLDINGS LIMITED 變靚D控股有限公司

REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

Yours faithfully,

Veda Capital Limited

REFRESHMENT OF GENERAL MANDATE TO ISSUE SHARES

INTRODUCTION

BASIS OF OUR ADVICE

PRINCIPAL FACTORS AND REASONS CONSIDERED

Background

Reasons for the grant of the Refreshed Mandate

Financial flexibility

Other financing alternatives

Potential dilution effect on the shareholding structure

Recommendation

1. memorAndum of continuAnce

2. Bye-lAWs

a. shares

(i) Classes of Shares

(ii) Share Certificates

b. directors

(ii) Power to dispose of the assets of the Company or any subsidiary

(iv) Loans to Directors

Appendix

(vii) Remuneration

(viii) Retirement, appointment and removal

Appendix

(ix) Borrowing powers

c. Alterations to constitutional documents

d. Alterations of capital

e. Variation of rights of existing shares or classes of shares

f. special resolutions – majority required

g. Voting rights and right to demand a poll

h. requirements for annual general meetings

i. Accounts and audit

Appendix

j. notices of meetings and business to be conducted thereat

k. transfer of shares

l. power for the company to purchase its own shares

m. power of any subsidiary of the company to own shares in the company

n. dividends and other methods of distribution

o. proxies

Appendix

p. calls on shares and forfeiture of shares

Wisdomcome Group Holdings Ltd. Proxy Solicitation & Information Statement 2009