10:20     TVB<00511> - Announcement (5)                                       

    The closing of any purchase of the Sale Shares by Dr.                     
    Chan or the Nominee (as appropriate) required under                       
    the terms of the Undertaking shall take place on 14                       
    September 2005.                                                           
                                                                              
    Shareholders Agreement                                                    
    Upon the First Closing, TVB Satellite, Enjoy Profits,                     
    Dr. Chan and Galaxy propose to enter into the                             
    Shareholders' Agreement for the regulation of the                         
    affairs and business of the Galaxy Group.                                 
                                                                              
    Board of directors                                                        
    As at the date of the Announcement, the board of                          
    directors of Galaxy comprises of 7 members. Under the                     
    Shareholders' Agreement, subject to certain                               
    conditions, TVB Satellite, Enjoy Profits and Dr. Chan                     
    or Nominee (as appropriate) will be entitled to                           
    nominate and appoint 3, 2 and 1 directors,                                
    respectively, to each of the boards of directors of                       
    Galaxy and Galaxy Broadcasting. A nomination                              
    committee will be established by each of the boards                       
    of directors of Galaxy and Galaxy Broadcasting which                      
    will nominate an independent director to the board                        
    of directors of Galaxy and Galaxy Broadcasting,                           
    respectively. The nomination and appointment are                          
    expected to take place after the First Closing.                           
                                                                              
    Pre-emption rights                                                        
    Under the Shareholders' Agreement, each of the                            
    Shareholders has agreed not to transfer or otherwise                      
    dispose of any Shares for a period of 5 years from                        
    the date of the First Closing. Thereafter, the                            
    Shareholders may transfer their Shares provided that                      
    they comply with the pre-emption right provisions                         
    contained in the Shareholders' Agreement. In addition,                    
    in the event of a change of control of a Shareholder                      
    or controlling party of such Shareholder (other than                      
    the Company), the pre-emption transfer rights may be                      
    triggered. Any transfer of Shares under the                               
    pre-emption transfer rights will be at either an                          
    agreed or fair market value. The non-transferring                         
    Shareholders also have the right to tag-along on a                        
    pro-rata basis on any proposed disposition.                               
                                                                              
    Any issue of new Shares is also subject to pre-emption                    
    rights under the Shareholders' Agreement.                                 
                                                                              
    Shareholder's Loan                                                        
    TVB Satellite has agreed to provide an unsecured                          
    interest bearing shareholder's loan of no more than                       
    HK$50,000,000 to Galaxy upon request for working                          
    capital purposes. The maturity date of any                                
    shareholders' loan provided by TVB Satellite will                         
    fall on the third anniversary of the Second Closing.                      
                                                                              
    Guarantees                                                                
    Each of the Company, Ruili and, if Dr. Chan nominates                     
    the Nominee to acquire the Sale Shares and take up                        
    the new Shares to be issued by Galaxy in his stead                        
    at First Closing, Dr. Chan is to provide a guarantee                      
    to the performance of the obligations of TVB Satellite,                   
    Enjoy Profits and the Nominee, respectively, under                        
    the Shareholders' Agreement.                                              
                                                                              
    Impact on the Group                                                       
    Before the Sale, the indirect 49% shareholding                            
    interest in Galaxy was accounted for by the Group                         
    under equity accounting as this investment was                            
    considered to be an associate of the Group. The 51%                       
    shareholding interest in Galaxy was accounted for at                      
    cost and included under Other Investments in the