THIS CIRCULAR IS IMPORTANT AND REQUIRES ... - TOM Group

DEFINITIONS“Latest Practicable Date”“Market Price”“Mr. Zhang”“Ms. Zhang”“Option Interests”“PRC”“PRC Shareholder”“PRC GAAP”“Pre-IPO Share Option Plan”“Put Option”means 28th April, 2004, being the latest practicable date prior tothe printing of this circular for ascertaining certain informationcontained hereinmeans HKD2.05, being the closing price per TOM Share as quotedon the Stock Exchange on 8th April, 2004 (i.e., the date of theSupplemental Agreement)means Zhang Baocheng (), who is independent of theDirectors, chief executive, substantial shareholders or managementshareholders of TOM or any of their respective Associates. As atthe Latest Practicable Date, Mr. Zhang owns 50% of the equityinterest in Hong Xiang and all of the equity interest of the PRCShareholdermeans Zhang Jing (), Mr. Zhang’s sister, who is independentof the Directors, chief executive, substantial shareholders ormanagement shareholders of TOM or any of their respectiveAssociatesmeans (1) the entire issued share capital of the BVI Shareholder;and (2) 1% of the equity interest in Hong Xiang New Co. held byTOM Nominee (which together represent 50% of the equity interestin Hong Xiang New Co.)means the People’s Republic of Chinameans (Guangzhou Hong Xiang Filmand Television Company Limited), a domestic limited liabilitycompany organized and existing under the laws of the PRC and isbeneficially wholly-owned by Mr. Zhang. As at the LatestPracticable Date, PRC Shareholder owns 50% of the equity interestin Hong Xiang New Co.means the generally accepted accounting principles adopted inthe PRCmeans the pre-IPO share option plan adopted by TOM on 11thFebruary, 2000 (as described in Appendix IV of TOM’s prospectusdated 18th February, 2000)means the right granted by Mr. Zhang to TOM Solutions at nilconsideration to require Mr. Zhang and/or his nominee(s) topurchase the Option Interests pursuant to the SupplementalAgreement– 4 –