Yau Lee Holdings Limited — Proxy Solicitation & Information Statement 2013

Nov 18, 2013

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, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Pokfulam Development Company Limited (the “ Company ”), you should at once hand this circular to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”) 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.

POKFULAM DEVELOPMENT COMPANY LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 225)

GENERAL MANDATES TO REPURCHASE SHARES AND ISSUE NEW SHARES

AND

RE-ELECTION OF RETIRING DIRECTORS

A notice of the Annual General Meeting to be held on 19 December 2013 (the “ Annual General Meeting ”) is set out in the Annual Report of the Company for the year ended 30 September 2013 (the “ Annual Report ”). A form of proxy for use by the shareholders at the Annual General Meeting is enclosed with the Annual Report which has been despatched to the shareholders together with this circular.

Whether or not you intend to attend the Annual General Meeting in person, you are requested to complete and return the form of proxy enclosed with the Annual Report in accordance with the instructions printed thereon and deposit the same with the registered office of the Company, 23rd Floor, Beverly House, 93-107 Lockhart Road, Wanchai, Hong Kong as soon as practicable but in any event not later than 48 hours before the time appointed for holding the Annual General Meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the Annual General Meeting should you so wish.

18 November 2013

CONTENTS

Page

Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
**Letter from **	the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
2.	General Mandate to Repurchase Shares . . . . . . . . . . . . . . . . . . . . . . . . .	4
3.	General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
4.	Re-election of Retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
5.	Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
6.	Voting by Way of Poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
7.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Appendix I	– Explanatory Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Appendix II – Details of Retiring Directors
	Proposed to be Re-elected . . . . . . . . . . . . . . . . . . . . . . . .	10

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DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:

• “Annual General Meeting”

• an annual general meeting of the Company to be held at Director’s Room, World Trade Centre Club Hong Kong, 38th Floor, World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong on Thursday, 19 December 2013 at 3:45 p.m., to consider and, if appropriate, to approve the resolutions contained in the notice of the meeting which is set out on pages 98 to 100 of the Annual Report, or any adjournment thereof

• “Annual Report”

• the annual report of the Company for the year ended 30 September 2013

• “Articles of Association”

• the articles of association of the Company currently in force

• “Board”

• the board of Directors

• “Companies Ordinance”

• the Companies Ordinance (Chapter 32 of the Laws of Hong Kong)

• “Company”

• Pokfulam Development Company Limited, a company incorporated in Hong Kong with limited liability, the Shares of which are listed on the Main Board of the Stock Exchange

• “Director(s)”

• the director(s) of the Company

• “Group”

• the Company and its subsidiaries

• “HK$”

• Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the People’s Republic of China

• “Latest Practicable Date”

• 13 November 2013, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular

• “Listing Rules”

• the Rules Governing the Listing of Securities on the Stock Exchange

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DEFINITIONS

“SFO”

• “Share(s)”

• “Share Issue Mandate”

• “Share Repurchase Mandate”

• “Shareholder(s)”

• “Stock Exchange”

• “Takeovers Code”

the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

ordinary share(s) of HK$1.00 each in the capital of the Company or if there has been a subsequent sub-division, consolidation, reclassification or reconstruction of the share capital of the Company, shares forming part of the ordinary equity share capital of the Company

• a general mandate proposed to be granted to the Directors to allot, issue or deal with additional Shares of not exceeding 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of proposed ordinary resolution contained in item 8 of the notice of the Annual General Meeting as set out on pages 98 to 100 of the Annual Report

• a general mandate proposed to be granted to the Directors to purchase Shares on the Stock Exchange of not exceeding 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of proposed ordinary resolution contained in item 7 of the notice of the Annual General Meeting as set out on pages 98 to 100 of the Annual Report

holder(s) of Share(s)

• The Stock Exchange of Hong Kong Limited

• The Code on Takeovers and Mergers approved by the Securities and Futures Commission as amended from time to time

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LETTER FROM THE BOARD

POKFULAM DEVELOPMENT COMPANY LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 225)

Executive Directors: Wong Tat Chang, Abraham (Chairman and Managing Director) Wong Tat Kee, David Wong Tat Sum, Samuel

Registered Office: 23rd Floor, Beverly House, 93-107 Lockhart Road, Wanchai, Hong Kong.

Independent Non-executive Directors: Lam Hsieh Lee Chin, Linda Li Kwok Sing, Aubrey Sit Hoi Wah, Kenneth

Secretary: Hui Sui Yuen

18 November 2013

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATES TO REPURCHASE SHARES AND ISSUE NEW SHARES AND RE-ELECTION OF RETIRING DIRECTORS

1. INTRODUCTION

At the annual general meeting of the Company held on 31 December 2012, resolutions were passed giving general mandates to the Directors of the Company to allot, issue and deal with the Shares of the Company and to exercise the powers of the Company to repurchase its own Shares in accordance with the relevant rules set out in the Listing Rules and the Takeovers Code. These general mandates will lapse at the conclusion of the forthcoming Annual General Meeting unless renewed at that meeting. Ordinary resolutions will therefore be proposed at the Annual General Meeting to renew the general mandates to repurchase Shares and to allot, issue and deal with Shares.

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LETTER FROM THE BOARD

The purpose of this circular is to provide you with information regarding, inter alia, the proposed general mandates to repurchase Shares and to allot, issue and deal with Shares and the re-election of retiring Directors.

2. GENERAL MANDATE TO REPURCHASE SHARES

At the Annual General Meeting, an ordinary resolution will be proposed to renew the granting to the Directors of the Share Repurchase Mandate, allowing the Company to repurchase its own Shares up to a limit of 10% of the aggregate nominal amount of the Company’s issued share capital as at the date of passing of the proposed ordinary resolution approving the Share Repurchase Mandate.

The Share Repurchase Mandate will expire upon whichever is the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by law to be held; and (c) the date on which the authority given under the ordinary resolution approving the Share Repurchase Mandate is revoked or varied by an ordinary resolution of the Shareholders in general meeting.

The Directors wish to state that they have no immediate plan to repurchase any Shares pursuant to the Share Repurchase Mandate.

An explanatory statement required by the Listing Rules to provide the Shareholders with requisite information reasonably necessary for them to make an informed decision on whether to vote for or against the granting of the Share Repurchase Mandate is set out in Appendix I to this circular.

3. GENERAL MANDATE TO ISSUE SHARES

At the Annual General Meeting, an ordinary resolution will be proposed to renew the granting to the Directors of the Share Issue Mandate. The Shares which may be allotted and issued pursuant to the Share Issue Mandate is up to 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing of the proposed ordinary resolution approving the Share Issue Mandate. An ordinary resolution to extend the Share Issue Mandate by adding the aggregate nominal amount of Shares repurchased by the Company pursuant to the Share Repurchase Mandate will also be proposed at the Annual General Meeting.

As at the Latest Practicable Date, the number of Shares of the Company in issue was 110,179,385. Subject to the passing of the proposed ordinary resolution granting the Share Issue Mandate and on the basis that no further Shares are issued after the Latest Practicable Date and up to the date of the passing such resolution, the Company will be allowed to issue a maximum of 22,035,877 Shares. The Company has not allotted any Shares during the past twelve months and has no present intention to issue any Shares. The reason of the Directors for seeking the grant of a general mandate to issue Shares is to give the Company the flexibility to do so if and when appropriate.

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LETTER FROM THE BOARD

The Share Issue Mandate will expire upon whichever is the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by law to be held; and (c) the date on which the authority given under the ordinary resolution approving the Share Issue Mandate is revoked or varied by an ordinary resolution of the Shareholders in general meeting.

The Directors wish to state that they have no immediate plan to issue any new Shares pursuant to the Share Issue Mandate.

4. RE-ELECTION OF RETIRING DIRECTORS

In accordance with Article 119 of the Articles of Association of the Company, Mr. Wong Tat Kee, David, an Executive Director and Mdm. Lam Hsieh Lee Chin, Linda, an Independent Non-executive Director, shall retire from office by rotation at the Annual General Meeting and, being eligible, offer themselves for re-election.

Mdm. Lam Hsieh Lee Chin, Linda who has been serving as an Independent Non-executive Director of the Company for more than 9 years, has confirmed her independence with reference to the factors set out in Rule 3.13 of the Listing Rules. The Company considers Mdm. Lam Hsieh Lee Chin, Linda is still independent in accordance with the independence guidelines as set out in the Listing Rules and will continue to bring valuable business experience, knowledge and professionalism to the Board for its efficient and effective functioning. The Board is not aware of any circumstances that might influence Mdm. Lam Hsieh Lee Chin, Linda in exercising her independent judgment.

Details of the retiring Directors proposed to be re-elected at the Annual General Meeting are set out in Appendix II to this circular.

5. ANNUAL GENERAL MEETING

A notice of the Annual General Meeting is set out in the Annual Report accompanying this circular.

A form of proxy for the Annual General Meeting is enclosed with the Annual Report. Whether or not you intend to be present at the Annual General Meeting, you are requested to complete the form of proxy and return it to the registered office of the Company, 23rd Floor, Beverly House, 93-107 Lockhart Road, Wanchai, Hong Kong in accordance with the instructions printed thereon as soon as practicable but in any event not later than 48 hours before the time appointed for holding the Annual General Meeting. Completion and return of the form of proxy will not preclude you from attending and voting at the Annual General Meeting in person should you so wish.

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LETTER FROM THE BOARD

6. VOTING BY WAY OF POLL

Pursuant to Rule 13.39(4) of the Listing Rules, all votes at the Annual General Meeting will be taken by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands. An announcement on the poll vote results will be published by the Company after the Annual General Meeting in the manner prescribed under Rule 13.39(5) of the Listing Rules.

7. RECOMMENDATION

The Directors believe that the proposed granting of the Share Repurchase Mandate and Share Issue Mandate and re-election of retiring Directors are in the best interests of the Company and the Shareholders. Accordingly, the Directors recommend the Shareholders to vote in favour of the resolutions to be proposed at the Annual General Meeting.

Yours faithfully, For and on behalf of

Pokfulam Development Company Limited Wong Tat Chang, Abraham Chairman and Managing Director

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APPENDIX I

EXPLANATORY STATEMENT

The following is an explanatory statement required by the Listing Rules to provide the Shareholders with requisite information reasonably necessary for them to make an informed decision on whether to vote for or against the ordinary resolution to be proposed at the Annual General Meeting in relation to the granting of the Share Repurchase Mandate. It also constitutes the memorandum under Section 49BA of the Companies Ordinance.

1. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 110,179,385 Shares.

Subject to the passing of the ordinary resolution set out in item 7 of the notice of the Annual General Meeting in respect of the granting of the Share Repurchase Mandate and on the basis that no further Shares are issued or repurchased before the Annual General Meeting, i.e. being 110,179,385 Shares, the Directors would be authorised under the Share Repurchase Mandate to repurchase, during the period in which the Share Repurchase Mandate remains in force, an aggregate nominal amount of Shares up to HK$11,017,938.00 (equivalent to 11,017,938 Shares), representing 10% of the aggregate nominal amount of Shares in issue as at the date of the Annual General Meeting.

2. REASONS FOR REPURCHASE

The Directors believe that the granting of the Share Repurchase Mandate is in the best interests of the Company and its Shareholders. Repurchases of Shares may, depending on the market conditions and funding arrangements at the time, lead to an enhancement of the net asset value per Share and/or earnings per Share and will only be made when the Directors believe that such a repurchase will benefit the Company and its Shareholders.

3. FUNDING OF REPURCHASE

In repurchasing Shares, the Company may only apply funds entirely from the Company’s available cashflow or working capital facilities and will be made out of funds legally available for such purpose (such as distributable profits of the Company or the proceeds of a fresh issue of Shares) in accordance with its Memorandum and Articles of Association and the laws of Hong Kong.

4. IMPACT OF REPURCHASE

There might be a material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited accounts contained in the Annual Report) in the event that the Share Repurchase Mandate was to be carried out in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Share Repurchase Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or the gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

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APPENDIX I

EXPLANATORY STATEMENT

5. NO DIRECTOR SELLING

There are no Directors or (to the best of the knowledge of the Directors, having made all reasonable enquiries) any associates (as defined in the Listing Rules) of Directors of the Company who have a present intention, in the event that the Share Repurchase Mandate is granted by Shareholders, to sell Shares to the Company.

6. UNDERTAKING

The Directors have undertaken to the Stock Exchange to exercise the power of the Company to make repurchases of Shares pursuant to the Share Repurchase Mandate in accordance with the Listing Rules and the applicable laws of Hong Kong.

7. TAKEOVERS CODE

If as a result of a repurchase of Shares pursuant to the Share Repurchase Mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition of voting rights for the purposes of the Takeovers Code. Accordingly, a Shareholder or a group of Shareholders acting in concert (within the meaning under the Takeovers Code), depending on the level of increase in the Shareholders’ interest, could obtain or consolidate control of the Company and thereby become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, to the best knowledge and belief of the Directors, Mr. Wong Tat Chang, Abraham, Mr. Wong Tat Kee, David and Mr. Wong Tat Sum, Samuel, the Executive Directors of the Company, each of whom is the beneficiary of a discretionary trust which in turn held 56,806,234 Shares representing approximately 51.56% of the issued share capital of the Company, are the substantial Shareholders of the Company. Also, Madison Profits Limited (Note) , which held 22,827,632 Shares representing approximately 20.72% of the issued share capital of the Company, is the substantial Shareholder of the Company.

In the event that the Directors exercise in full the power to repurchase Shares pursuant to the Share Repurchase Mandate, then (if the present shareholdings remain the same) the attributable interest of Mr. Wong Tat Chang, Abraham, Mr. Wong Tat Kee, David and Mr. Wong Tat Sum, Samuel, being the beneficiaries of the discretionary trusts, and Madison Profits Limited [(Note)] would be increased to approximately 57.29% and 23.02% of the issued share capital of the Company respectively. The Directors have no present intention to exercise the power to repurchase Shares to the extent that the aggregate amount of the share capital of the Company in public hands would be reduced to less than 25%.

Note: These 22,827,632 Shares held by Madison Profits Limited were taken to be the corporate interests of Mdm. Kung, Nina (deceased) pursuant to the SFO. Mr. Lam Hok Chung Rainier, Mr. Jong Yat Kit and Mr. Yu Sai Hung, as joint and several administrators of the estate of Mdm. Kung, Nina (deceased), are deemed to have interest in the said 22,827,632 Shares in the capacity of trustees.

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APPENDIX I

EXPLANATORY STATEMENT

The Directors are not aware of any consequences which may give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code.

8. NO REPURCHASE

The Company had not purchased any Shares (whether on the Stock Exchange or otherwise) in the six months preceding the Latest Practicable Date.

9. CONNECTED PERSONS

No connected persons (as defined in the Listing Rules) of the Company have notified it of a present intention to sell Shares to the Company and no such persons have undertaken not to sell any such Shares to the Company in the event that the Share Repurchase Mandate is granted by the Shareholders.

10. SHARE PRICES

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

							Highest	Lowest
							HK$	HK$
2012
November							13.400	12.600
December							13.400	12.900
2013
January							13.200	12.800
February							12.860	12.700
March							12.760	12.400
April							12.760	12.300
May							12.980	12.500
June							12.800	12.240
July							12.800	12.300
August							12.800	12.540
September							12.680	12.680
October							12.680	12.300
November	(up	to	the	Latest	Practicable	Date)	12.200	11.900

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APPENDIX II

DETAILS OF RETIRING DIRECTORS PROPOSED TO BE RE-ELECTED

The following are the particulars of the Directors proposed to be re-elected at the Annual General Meeting:

1. Mr. Wong Tat Kee, David , aged 61, has been a Director of the Company since 27 January 1981. He is currently an Executive Director of the Company. He holds a Bachelor and a Master degree in mechanical engineering from Stanford University and also a Master of Business Administration degree from the University of Western Ontario. He has been involved in the building construction business in Hong Kong for over 30 years. He also holds directorship in a number of private companies, namely B L Wong (Holdings) Limited and certain subsidiaries of the Group.

Save as disclosed above, Mr. Wong Tat Kee, David did not hold any other directorship in the last three years in public companies the securities of which are listed on any securities market in Hong Kong or overseas.

Mr. Wong Tat Kee, David is the younger brother of Mr. Wong Tat Chang, Abraham and the elder brother of Mr. Wong Tat Sum, Samuel. Both of Mr. Wong Tat Chang, Abraham and Mr. Wong Tat Sum, Samuel are the Executive Directors and substantial Shareholders of the Company. In addition, Mr. Wong Tat Chang, Abraham holds the position of the Chairman of the Board and Managing Director of the Company. Save as disclosed above, Mr. Wong Tat Kee, David does not have any relationship with any other Directors, senior management or substantial or controlling Shareholders of the Company.

As at the Latest Practicable Date, Mr. Wong Tat Kee, David did not have personal interest in Shares in the Company, but had other interests of 56,806,234 Shares (approximately 51.56% of the issued share capital of the Company) in the Company within the meaning of Part XV of the SFO. Also, Mr. Wong Tat Kee, David held other interests of 4,784 shares in Elephant Holdings Limited, a subsidiary of the Company.

On 1 April 2012, Mr. Wong Tat Kee, David entered into a letter of appointment with the Company for a specific term of three years commencing from 1 April 2012 and is subject to retirement and re-election at annual general meetings of the Company pursuant to the Articles of Association. His emoluments are to be determined by the Board of Directors with reference to market rates, the Company’s remuneration policy, his duties and responsibilities with the Group subject to the approval of the Shareholders and annual review of the Board of Directors. For the year ended 30 September 2013, he received a Director’s fee of HK$60,000.

Save as disclosed above, there are no other matters concerning Mr. Wong Tat Kee, David that need to be brought to the attention of the Shareholders of the Company and that there is no other information that needs to be disclosed pursuant to the requirements of Rule 13.51(2)(h) to (v) of the Listing Rules.

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APPENDIX II

DETAILS OF RETIRING DIRECTORS PROPOSED TO BE RE-ELECTED

1. Mdm. Lam Hsieh Lee Chin, Linda , aged 86, was appointed as a Director of the Company in 1973. She is currently an Independent Non-executive Director and a member of the Audit Committee of the Company. She studied in Aurora College for Women, Shanghai. She is the elder of Kowloon Tong Church of the Chinese Christian and Missionary Alliance.

Save as disclosed above, Mdm. Lam Hsieh Lee Chin, Linda did not hold any other directorship in the last three years in public companies the securities of which are listed on any securities market in Hong Kong or overseas or any position in other companies within the Group.

Mdm. Lam Hsieh Lee Chin, Linda does not have any relationship with any Directors, senior management or substantial or controlling Shareholders of the Company.

As at the Latest Practicable Date, Mdm. Lam Hsieh Lee Chin, Linda had a personal interest of 104,420 Shares in the Company (equivalent to approximately 0.095% of the issued share capital of the Company) within the meaning of Part XV of the SFO.

On 1 April 2012, Mdm. Lam Hsieh Lee Chin, Linda entered into a letter of appointment with the Company for a specific term of three years commencing from 1 April 2012 and is subject to retirement and re-election at annual general meetings of the Company pursuant to the Articles of Association. Her emoluments are to be determined by the Board of Directors with reference to market rates subject to the approval of the Shareholders and annual review of the Board of Directors. For the year ended 30 September 2013, she received a Director’s fee of HK$60,000 and a fee of HK$12,000 for attending meetings of the Audit Committee.

Save as disclosed above, there are no other matters concerning Mdm. Lam Hsieh Lee Chin, Linda that need to be brought to the attention of the Shareholders of the Company and that there is no other information that needs to be disclosed pursuant to the requirements of Rule 13.51(2)(h) to (v) of the Listing Rules.

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