CTEL Hong Kong Television Network Ltd. (MM)

SIGNATURE

Pursuant to the requirements of section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: November 28 ^th , 2007

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

If you have sold or transferred all your shares in City Telecom (H.K.) Limited, you should hand this circular and the accompanying form of proxy at once to the purchaser or transferee or the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

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

(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

PROPOSALS FOR

RE-ELECTION OF RETIRING DIRECTORS,

REFRESHMENT OF THE SCHEME MANDATE LIMIT,

GENERAL MANDATES TO ISSUE AND TO REPURCHASE SHARES

AND

NOTICE OF ANNUAL GENERAL MEETING

The notice convening the Annual General Meeting of City Telecom (H.K.) Limited to be held at Level 39, Tower 1, Metroplaza, No. 223 Hing Fong Road, Kwai Chung, New Territories, Hong Kong on 24 December 2007 at 11:00 a.m. is set out on pages 15 to 19 of this circular. Whether or not you are able to attend the meeting, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending the meeting.

28 November 2007

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(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

To the Shareholders

Dear Sirs/Madams,

PROPOSALS FOR

RE-ELECTION OF RETIRING DIRECTORS,

REFRESHMENT OF THE SCHEME MANDATE LIMIT,

GENERAL MANDATES TO ISSUE AND TO REPURCHASE SHARES

AND

NOTICE OF ANNUAL GENERAL MEETING

The Company will propose at the AGM resolutions to, inter alia , (i) re-elect retiring Directors, (ii) refresh the Scheme Mandate Limit and (iii) grant to Directors general mandates to issue and to repurchase Shares.

The purpose of this circular is to give you notice of the AGM and to provide you with further information reasonably necessary for you to make an informed decision on whether to vote for or against the resolutions to be proposed at the AGM.

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II.     RE-ELECTION OF RETIRING DIRECTORS

Pursuant to the Articles 96 and 99 of Articles of Association, Messrs. Lee Hon Ying, John and Peh Jefferson Tun Lu will retire at the AGM and, being eligible, will offer themselves for re-election. The Board proposes to re-appoint Messrs. Lee Hon Ying, John and Peh Jefferson Tun Lu as Directors at the AGM. Biographical details of each of Messrs. Lee Hon Ying, John and Peh Jefferson Tun Lu are set out in Appendix I to this circular.

III.    REFRESHMENT OF THE SCHEME MANDATE LIMIT

Pursuant to the Listing Rules and the Share Option Scheme, the Scheme Mandate Limit may not exceed 10% of the Shares in issue as at the date of approval or adoption of the Share Option Scheme by the Shareholders. The Scheme Mandate Limit may be refreshed by the Shareholders in general meeting from time to time.

At the extraordinary general meeting of the Company held on 23 December 2002, the Shareholders approved the adoption of the Share Option Scheme and the Scheme Mandate Limit, being 10% of the Shares in issue as at 23 December 2002 (i.e. 50,302,066 Shares).

At the annual general meeting of the Company held on 29 December 2004, the Shareholders approved the refreshment of the Scheme Mandate Limit, being 10% of the Shares in issue as at 29 December 2004 (i.e. 61,407,340 Shares). Accordingly, after the refreshment of the Scheme Mandate Limit on 29 December 2004, the Directors are able to grant Options for subscription up to 61,407,340 Shares under the Share Option Scheme and any other share option scheme(s) of the Company.

As at the Latest Practicable Date, Options have been granted which entitle their respective holders to subscribe for a total of 71,280,000 Shares of which 19,820,000 have lapsed or have been cancelled or exercised. Accordingly, Options which entitle their respective holders to subscribe for a total of 51,460,000 Shares (representing approximately 8.25% of the issued share capital of the Company as at the Latest Practicable Date) remain outstanding and unexercised as the Latest Practicable Date.

The Board wishes to retain the flexibility to be able to make new grants of Options under the Share Option Scheme as desirable and, given the growth in the size of the Group, the increase in the number of employees and the Options already granted since the adoption of the Share Option Scheme, the Board wishes to take this opportunity to recommend for Shareholders’ approval at the AGM that the Scheme Mandate Limit be refreshed. The Directors consider that the refreshment of the Scheme Mandate Limit is in the interests of the Group and the Shareholders as a whole as it enables the Company to grant Options to eligible participants to reward and motivate them to strive for the future development and expansion of the Group.

Pursuant to the Listing Rules, the Shares which may be issued upon exercise of all outstanding options granted and yet to be exercised under the Share Option Scheme and any other share option scheme(s) of the Company at any time must not exceed 30% of the

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Shares in issue from time to time. No options shall be granted under any share option scheme(s) of the Company or any of its subsidiaries if this will result in the 30% limit being exceeded.

If the Scheme Mandate Limit is refreshed, the Board will be able to grant Options for subscription of up to 62,409,340 Shares, being 10% of 624,093,404 Shares in issue as at the date of the AGM and assuming that no further Shares will be issued and/or repurchased prior to the AGM.

The total number of Shares which may fall to be issued upon exercise of all Options granted since adoption of the Share Option Scheme on 23 December 2002 but yet to be exercised, or have not been lapsed or cancelled are 51,460,000, representing 8.25% of the total number of Shares in issue as at the Latest Practicable Date. There are no options granted under the 1997 Share Option Scheme which are still outstanding and yet to be exercised, or which have not been lapsed or cancelled. Therefore, if the Scheme Mandate Limit is refreshed at the AGM, the aggregate maximum number of Shares that may be issued pursuant to (i) the grant of Options and options under other any other option scheme(s) under the Scheme Mandate Limit so refreshed, being 62,409,340 Shares, and (ii) the number of outstanding Options aforesaid, being 51,460,000 Shares, is 113,869,340, representing 18.25% of the total number of Shares in issue as at the date of the AGM, assuming that no further Shares will be issued and/or repurchased prior to AGM.

As required by the Share Option Scheme and the Listing Rules, an ordinary resolution will be proposed at the AGM to approve the refreshed Scheme Mandate Limit such that the total number of Shares which may be issued upon exercise of all Options to be granted under the refreshed Scheme Mandate Limit must not exceed 10% of the total number of Shares in issue as at the date of approval of the refreshed Scheme Mandate Limit.

Application will be made to the Listing Committee of the Stock Exchange by the Company for the listing of and permission to deal in the Shares representing a maximum of 10% of the total number of Shares in issue as at the date of approval of the refreshed Scheme Mandate Limit which may be issued pursuant to the exercise of the options to be granted under the Share Option Scheme and any other share option scheme(s) of the Company.

IV.    GENERAL MANDATES

At the annual general meeting of the Company held on 29 December 2006, general mandates were given to the Directors to exercise all powers of the Company, inter alia , (i) to repurchase Shares the aggregate nominal amount of which does not exceed 10% of the aggregate nominal amount of the issued share capital of the Company on 29 December 2006 and (ii) to allot, issue and deal with Shares not exceeding the sum of 20% of the aggregate nominal amount of the issued share capital of the Company on 29 December 2006 and the nominal amount (up to a maximum of 10% of the aggregate nominal amount of the then issued share capital of the Company) of any Shares repurchased by the Company.

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Under the terms of the Ordinance and the Listing Rules, these general mandates lapse at the conclusion of the AGM, unless renewed at that meeting. Resolutions set out as resolutions No. 6 to 8 in the notice of the AGM will be proposed at the AGM to renew these mandates. With reference to these resolutions, the Directors wish to state that they have no immediate plans to repurchase any Shares or to issue any new Shares pursuant to the relevant mandates.

The explanatory statement required by the Listing Rules to be sent to Shareholders in connection with the proposed repurchase of Shares is set out in Appendix II to this circular. This contains all the information reasonably necessary to enable Shareholders to make an informed decision on whether to vote for or against the resolution.

V.      AGM

The AGM Notice is set out on pages 15 to 19 of this circular. A form of proxy for use at the AGM is enclosed.

Whether or not you intend to attend the AGM, you are requested to complete the form of proxy accompanying the notice of AGM and deposit it at the Company’s share registrar, Computershare Hong Kong Investor Services Limited at Rooms 1806–1807, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time appointed for holding the AGM. The return of a form of proxy will not preclude you from attending and voting in person if you so wish.

Poll Procedures

Articles 71 to 77 of the Articles of Association set out the procedures under which a poll may be demanded.

At any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand of a poll) a poll is properly demanded or is required under the Listing Rules or any other applicable law or regulations. Subject to the Companies Ordinance, a poll may be demanded by:

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Unless a poll is so demanded and the demand is not withdrawn, a declaration by the chairman that a resolution has been carried or carried unanimously or by a particular majority or not carried by a particular majority or lost shall be final and conclusive and an entry to that effect in the minute book of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded for or against the resolution.

If a poll is properly demanded it shall be taken in such manner as the chairman shall direct and he may appoint scrutineers who need not be members. The result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.

A poll demanded on the election of a chairman, or on a question of adjournment, shall be taken forthwith. A poll demanded on any other question shall be taken either forthwith or on such date (being not later than three months after the date of the demand) and at such time and place as the chairman shall direct. It shall not be necessary (unless the chairman otherwise directs) for notice to be given of a poll.

The demand for a poll shall not prevent the continuance of a meeting for the transaction of any business other than the question on which the poll was demanded and it may be withdrawn with the consent of the chairman at any time before the close of the meeting or the taking of the poll, whichever is the earlier, and in that event shall not invalidate the result of a show of hands declared before the demand was made.

On a poll votes may be given either personally or by proxy. A member may appoint more than one proxy to attend on the same occasion.

A person entitled to more than one vote on a poll need not use all his votes or cast all the votes he uses in the same way.

In the case of a equality of votes at a general meeting, whether on a show of hands or on a poll, the chairman of the meeting shall, subject to Article 80A, be entitled to an additional or a casting vote.

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VI.    RECOMMENDATION

The Directors believe that the re-election of the retiring Directors, the refreshment of the Scheme Mandate Limit and the granting of the general mandates to issue and to repurchase Shares are all in the interests of the Company and the Shareholders as a whole and accordingly, the Directors recommend you to vote in favour of all the resolutions to be proposed at the AGM.

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In accordance with the Articles of Association, the following Directors will retire from office at the AGM and, being eligible, will offer themselves for re-election:

Under the service contract between Mr. Lee and the Company, the appointment of Mr. Lee as an independent non-executive director of the Company is for a term of one year subject to retirement by rotation and re-election at the AGM in accordance with the Articles of Association. Mr. Lee’s remuneration as an independent non-executive director is fixed at HK$168,000 per annum by reference to his duties and responsibilities within the Company. The said sum of HK$168,000 per annum is covered by the said service contract.

Mr. Lee has not previously held and is not holding any other position with any companies within the Group and he does not have any relationship with any director, senior management, substantial or controlling shareholder of any company within the Group and does not have any interests in Shares within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) as at the Latest Practicable Date.

Mr. Lee has not been involved in any of the matters which is discloseable pursuant to any of the requirements set out in Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

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Save as disclosed above, Mr. Peh has not held any other directorship in any listed company in the last 3 years.

Under the service contract between Mr. Peh and the Company, the appointment of Mr. Peh as an independent non-executive director of the Company is for a term of one year subject to retirement by rotation and re-election at the AGM in accordance with the Articles of Association. Mr. Peh’s remuneration as an independent non-executive director is fixed at HK$157,500 per annum by reference to his duties and responsibilities within the Company. The said sum of HK$157,500 per annum is covered by the said service contract.

Mr. Peh has not previously held and is not holding any other position with any companies within the Group and he does not have any relationship with any director, senior management, substantial or controlling shareholder of any company within the Group and does not have any interests in Shares within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) as at the Latest Practicable Date.

Mr. Peh has not been involved in any of the matters which is discloseable pursuant to any of the requirements set out in Rules 13.51(2)(h) to 13.51(2)(v) of the Listing Rules and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

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This is the explanatory statement, as required by the relevant rules set out in the Listing Rules to be sent to the Shareholders in connection with the proposed general mandate for the repurchase of Shares and also constitutes the memorandum required under section 49BA of the Ordinance.

SHARE REPURCHASE RULES

The Share Repurchase Rules provide that all proposed repurchase of securities by a company with listing on the Stock Exchange must be approved in advance by an ordinary resolution of its shareholders in general meeting, either by way of a general mandate or by a specific approval of a particular transaction. A maximum of 10% of the fully paid-up securities of a company as at the date of the passing of the relevant resolution may be repurchased on the Stock Exchange.

SHARE CAPITAL

As at the Latest Practicable Date, the authorised share capital of the Company comprises 2,000,000,000 Shares and the number of Shares in issue was 624,093,404.

Subject to passing of the relevant ordinary resolution and on the basis that no further Shares will be issued or repurchased prior to the AGM, the Company would be allowed to repurchase a maximum of 62,409,340 Shares, equivalent to 10% of the issued share capital of the Company during the Relevant Period (as hereinafter defined) in which the general mandate to repurchase Shares remains in force. Any Shares repurchased pursuant to the general mandate to repurchase Shares must be fully paid-up.

“Relevant Period” means the period from the date of the passing of the relevant ordinary resolution on the general mandate to repurchase Shares until whichever is the earliest of:

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REASONS FOR REPURCHASES

The Directors believe that it is in the best interests of the Company and its Shareholders as a whole to have a general authority from Shareholders to enable the Company to repurchase Shares in the market. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value of the Company 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 as a whole.

FUNDING OF REPURCHASES

In repurchasing the Shares, the Company may only apply funds legally available for such purpose in accordance with the Articles of Association and the laws of Hong Kong. The laws of Hong Kong provide that the amount of capital repaid in connection with a Share repurchase may only be paid out of either the profits that would otherwise be available for dividends or the proceeds of a fresh issue of shares made for that purpose. The premium payable on a repurchase of Shares may only be paid out of either the profits that would otherwise be available for dividends or out of the share premium account of the Company. It is envisaged that any such repurchase of Shares would be appropriately financed by the Company’s distributable profits.

In the event that the proposed Share repurchases were to be carried out in full at any time during the proposed repurchase period, there could be a material adverse impact on the working capital or gearing position of the Company as compared with the position disclosed in the audited consolidated financial statements contained in the Annual Report. However, the Directors do not propose to exercise the repurchase mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or its gearing levels which in the opinion of the Directors is from time to time inappropriate for the Company.

DIRECTORS’ UNDERTAKING

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, the exercise of the power of the Company to make repurchases pursuant to the repurchase mandate will be in accordance with the Listing Rules and the applicable laws of Hong Kong.

DIRECTORS’ DEALING

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates have any present intention, in the event that the proposed repurchase mandate is granted by the Shareholders, to sell the Shares to the Company.

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CONNECTED PERSONS

No connected person of the Company has notified the Company that he has a present intention to sell the Shares held by him to the Company, or has undertaken not to do so, in the event that the proposed repurchase mandate is granted by the Shareholders.

EFFECT OF THE TAKEOVERS CODE

If as a result of a Share repurchase a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purpose of the Takeovers Code. As a result, a Shareholder, or a group of Shareholders acting in concert (depending on the level of increase of Shareholder’s interests) could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code. As at the Latest Practicable Date, the controlling Shareholders, Messrs. Wong Wai Kay, Ricky and Cheung Chi Kin, Paul, together with their associates (including Top Group International Limited) beneficially owned 353,046,999 Shares representing approximately 56.57% of the total issued share capital of the Company and their shareholding will be increased to approximately 62.86% of the total issued share capital of the Company if the repurchase mandate is exercised in full. The Directors believe that by such increase such Shareholders together with their associates would not become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code.

No repurchase would be made by the Company of the Shares without the Stock Exchange’s prior approval if such repurchase would result in less than 25% of the issued share capital of the Company being in public hands.

SECURITIES REPURCHASES MADE BY THE COMPANY

No repurchase has been made by the Company of the Shares on the Stock Exchange in the six months prior to the Latest Practicable Date.

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(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

NOTICE IS HEREBY GIVEN that the 2007 Annual General Meeting of the Company will be held at Level 39, Tower 1, Metroplaza, No. 223 Hing Fong Road, Kwai Chung, New Territories, Hong Kong on 24 December 2007 at 11:00 a.m. for the following purposes:

As Ordinary Business

As Special Business

“ THAT :

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“ Relevant Period ” means the period from the passing of this resolution until whichever is the earliest of:

“ Rights Issue ” means an offer of shares or offer or issue of warrants, options or other securities of the Company giving rights to subscribe for shares open for a period fixed by the directors of the Company to holders of shares on the register of members of the Company on a fixed record date in proportion to their then holdings of such shares (subject to such exclusions or other arrangements as the directors of the Company may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, or any territory outside, Hong Kong).”

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“ THAT :

“ Relevant Period ” means the period from the passing of this resolution until whichever is the earliest of:

“ THAT , subject to the passing of resolutions No. 6 and 7 above, the authority granted to the directors of the Company pursuant to resolution No. 6 above be and is hereby extended by the addition to the aggregate nominal amount of share capital which may be allotted or agreed conditionally or unconditionally to be allotted pursuant to such authority an amount representing the aggregate nominal amount of shares in the share capital of the Company repurchased by the Company under the authority granted pursuant to resolution No. 7 above, provided that such extended amount so

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repurchased shall not be more than 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue as at the date of passing this resolution.”

“ THAT conditional upon the Listing Committee of The Stock Exchange of Hong Kong Limited granting listing of, and permission to deal in, the shares of HK$0.10 each in the share capital of the Company (the “ Shares ”) to be issued pursuant to the exercise of options which may be granted under the Refreshed Scheme Mandate Limit (as defined below) under the share option scheme adopted by the Company on 23 December 2002 (the “ Scheme ”) and any other option scheme(s) of the Company (excluding options previously granted, outstanding, cancelled, lapsed or exercised under the Scheme and any other share option schemes of the Company),

By Order of the Board

Tai Kwok Hung

Company Secretary

Hong Kong, 28 November 2007

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Notes:

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(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

FORM OF PROXY FOR THE ANNUAL GENERAL MEETING

(or any adjournment thereof)

I/We ^{(Note 1)} __________________________________________________________________________________________________________________________________

of ___________________________________________________________________________________________________________________________________________

being the registered holder(s) of ^{(Note 2)} ________________________________________________________________________________ shares (the “ Shares ”) of HK$0.10

each in the share capital of City Telecom (H.K.) Limited (the “ Company ”), HEREBY APPOINT THE CHAIRMAN OF THE MEETING or ^{(Note 3)} ________________________________________________________________________________________________________________________________________________

of _________________________________________________________________________________________________________________________________________

as my/our proxy to attend and act for me/us and on my/our behalf at the annual general meeting (the “ Meeting ”) of the Company to be held at Level 39, Tower 1, Metroplaza, No. 223 Hing Fong Road, Kwai Chung, New Territories, Hong Kong on 24 December 2007 at 11:00 a.m. (or at any adjournment thereof) for the purpose of considering and, if thought fit, passing the ordinary resolutions as set out in the notice convening the Meeting and at the Meeting (or at any adjournment thereof) to vote for me/us and in my/our name(s) in respect of such resolutions as hereunder indicated ^{(Note 4)} :

Notes: