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Press Release

6 April 2009

RCG Holdings Limited 

('RCG' or the 'Company')

Shareholder Circular re' Scrip Dividend 

The following information is an excerpt from the circular to Shareholders (the 'Circular') posted today. Copies of the Circular are available on the Company's website: www.rcg.tv in the Investor Relations section. Definitions used in the Circular apply in this announcement unless the context otherwise requires.

SCRIP DIVIDEND SCHEME IN RELATION TO THE FINAL DIVIDEND 
FOR THE YEAR ENDED 31 DECEMBER 2008

SCRIP DIVIDEND SCHEME

On 11 March 2009, the board of directors (the ''Board'') of RCG Holdings Limited (the ''Company'') conditionally declared a final dividend in respect of the year ended 31 December 2008 (''2008 Final Dividend'') of HK$0.165 per ordinary share of HK$0.01 each (''Share'') or 1.5 pence per Share (based on an exchange rate of £1 to HK$11.00) conditional on the shareholders of the Company (the ''Shareholders'') resolving at the forthcoming annual general meeting of the Company to be held on 21 April 2009 (the ''Annual General Meeting'') that the dividend be satisfied wholly in the form of an allotment of Shares credited as fully paid up without offering any right to Shareholders to elect to receive such dividend in cash in lieu of such allotment (the ''Scrip Dividend Scheme''). The 2008 Final Dividend will be paid to the Shareholders whose names appeared on the register of members of the Company on 3 April 2009 (the ''Record Date''), and eligible Shareholders will receive new Shares in the capital of the Company in lieu of cash in respect of all of such dividend. The last date on which the transfers were accepted for registration for participation in the Scrip Dividend Scheme was Tuesday, 31 March 2009.

Subject to Shareholders' approval, each Shareholder of the Company eligible to receive the 2008 Final Dividend will be allotted new Shares at HK$6.75 (equivalent to 61.34 pence based on an exchange rate of £1 to HK$11.00) per new Share credited as fully paid as determined in the manner stated below.

The number of new Shares to be allotted to each Shareholder pursuant to the Scrip Dividend Scheme was calculated by reference to the market value of HK$6.75 (equivalent to 61.34 pence based on the exchange rate of £1 to HK$11.00) per Share which was the average of the closing prices per Share of the Company quoted on The Stock Exchange of Hong Kong Limited (the ''Hong Kong Stock Exchange'') and AIM (''AIM''), a market operated by London Stock Exchange plc (''LSE'') for the five consecutive trading days from Wednesday, 25 March 2009 to Tuesday, 31 March 2009 (based on an exchange rate of £1 to HK$11.00). Accordingly, the number of new Shares that each Shareholder will receive under the Scrip Dividend Scheme will be calculated as follows:

Number of new Shares to be received	=	Number of Shares Held on the Record Date	x	HK$0.165
				HK$6.75

A maximum of 5,688,833 new Shares will be issued under the Scrip Dividend Scheme. The number of new Shares to be allotted to each Shareholder will be rounded down to the nearest whole number of new Shares. Fractional entitlements to new Shares will not be issued to the Shareholders but will be disregarded and no cash payment will be made in respect thereof. Holders of the depository interests issued by Capita IRG Trustees Limited representing Shares on a one-for-one basis (''Depository Interests'') will receive new Depository Interests pro-rata to their existing holdings in respect of the new Shares issued to Capita IRG Trustees Limited pursuant to the Scrip Dividend Scheme. Fractional entitlements will not be issued to Depository Interest holders; these will be aggregated and donated to charity. The new Shares when issued will rank in full for all dividends and any other distributions declared, made or paid thereafter and otherwise pari passu in all respects with the existing Shares, except that they will not rank for the 2008 Final Dividend itself. 

Note to Shareholders who may be subject to UK taxation

The following summary is intended only as a general guide to current UK tax legislation and to what is understood to be the current practice of HM Revenue & Customs (''HMRC''), in each case as at the date of this circular. It summarises the Company's understanding of the position of a Shareholder or holder of Depository Interests who (unless the position of non-resident Shareholders or holders of Depository Interests are expressly referred to) is resident and (in the case of an individual) ordinarily resident in the UK for UK tax purposes (a ''UK Holder''), who is the beneficial owner of Shares or Depository Interests and who holds his Shares or Depository Interests as an investment. It should not be relied on as authoritative and does not deal with the position of certain classes of Shareholders or holders of Depository Interests, such as dealers in securities and insurance companies, trusts, and persons who have acquired their Shares and/or Depository Interests by reason of their or another's employment. References in the summary to Shares and Shareholders should be treated as including Depositary Interests and holders of Depositary Interests respectively.

The UK tax treatment of the Scrip Dividend Scheme is not entirely clear.

Shareholders may seek to argue that the Scrip Dividend Scheme should be treated for UK taxation purposes in the same way as a bonus issue, on the basis that although the Board has declared a dividend in a cash amount, in fact Shareholders would only ever be entitled to receive new Shares pro rata to their existing holdings. If this argument is successful, the Scrip Dividend Scheme will give rise to no liability to UK taxation for Shareholders of all types, and the new Shares will be treated as having no base cost for the purposes of calculating any liability to tax on chargeable gains arising on their eventual disposal.

However, the Company has been advised that there is a material risk that the Scrip Dividend Scheme might instead best be analysed for UK tax purposes as the payment of a cash dividend which is applied in subscription for new Shares. If this analysis is correct, UK resident Shareholders will suffer a liability to tax on income as if they had received the cash amount of the declared dividend attributable to their Shares, notwithstanding that that cash amount will not in fact ever be received by them. They would then have a base cost in those new Shares equal to the cash amount of the dividend considered to have been received.

If the Scrip Dividend Scheme does give rise to tax on a cash amount, an individual Shareholder whose shareholding represents less than 10 per cent. of the issued share capital of the Company will be entitled to a tax credit equal to one-ninth of the cash amount of the dividend. The tax credit therefore equals 10 per cent. of the aggregate amount of the dividend and the tax credit. The tax credit is available to offset the Shareholder's liability to income tax on receipt of the dividend. Individual Shareholders whose income is within the starting rate or basic rate bands for income tax purposes will be subject to income tax at the dividend ordinary rate of 10 per cent. on their dividend income, so that the tax credit will satisfy in full such Shareholders' liability to income tax on the dividend. The dividend upper rate of income tax is 32.5 per cent., so that an individual Shareholder whose income is subject to higher rate income tax will be liable, after taking into account the tax credit, to pay further income tax equal to 22.5 per cent. of the amount of the dividend and the tax credit, which is equal to 25 per cent. of the amount of the dividend actually received by the Shareholder. An individual Shareholder who is not liable to income tax on the dividend (or part of it) is not able to claim repayment of the tax credit (or part of it) in cash from HMRC.

Under current law, if the Scrip Dividend Scheme falls to be taxed as a cash dividend, Shareholders which are within the scope of UK corporation tax will be liable to corporation tax on the cash amount they are considered to have received. The UK Government had announced that it intended to introduce an exemption from tax on receipts by UK companies of most dividends paid by non-UK companies with effect from 1 April 2009. Although no formal announcement that the introduction of the regime will be delayed has been made, the UK Government has given a number of informal indications that this will be the case. It is therefore extremely unlikely that the new exemption regime, if eventually introduced, will apply to the proposed Scrip Dividend Scheme.

Overseas Shareholders

Based on the register of members of the Company as at the Record Date, all the Shareholders of the Company had registered addresses in Hong Kong or the United Kingdom save that there was one Shareholder with a registered address in Italy, two Shareholders with registered addresses in Portugal, two Shareholders with registered addresses in Singapore and twenty-one Shareholders with registered addresses in Ireland.

In relation to these overseas Shareholders, the Directors have made enquiries with legal advisers in the relevant jurisdictions, and have been advised that the Company may rely on exemptions from registration or fulfilment of certain filing or other procedures under the relevant securities legislation in respect of the issue of scrip dividend to such overseas Shareholders. Accordingly, these Shareholders will be permitted to participate in the Scrip Dividend Scheme.

Neither this circular nor the new Shares will be registered or filed under the securities laws or equivalent legislation of any jurisdiction outside Hong Kong. The participation in the Scrip Dividend Scheme by overseas Shareholders may be restricted by the laws of their relevant jurisdictions. Shareholders with registered addresses outside Hong Kong and the United Kingdom should consult their own professional advisers as to whether or not they are permitted to receive the 2008 Final Dividend in the form of an issue of new Shares or if any governmental or other consent is required or other formalities which need to be observed and whether there are any other restrictions in relation to the future sale of any new Shares so acquired. Overseas Shareholders residing in jurisdiction where it would be illegal for them to participate in the Scrip Dividend Scheme will be deemed to have received this circular for information only.

  Note regarding the position in Italy

This Scrip Dividend Scheme is only addressed to one Italian shareholder of the Company whose name appeared on the register of members of the Company on the Record Date (the ''Italy Shareholder'').

Therefore, according to Article 100 of Legislative Decree no. 58 of 24 February 1998 and Article 33 paragraph 1 letter (a) of Consob Regulation no. 11971 of 14 May 1999, as amended, no prospectus is required and this circular has not been submitted to the clearance by CONSOB (the Italian Securities Exchange Commission) and will not be subject to the formal review or clearance by CONSOB.

Accordingly, no new Shares will be allotted, nor may copies of this circular be distributed in Italy, other than to the Italy Shareholder. Under no circumstances should this circular be circulated among, or be distributed in Italy to any member of the general public in Italy.

Stock Exchange Listings and Despatch of Share Certificates

The existing Shares are listed on the main board of the Hong Kong Stock Exchange and are also admitted to trading on AIM and the PLUS Market. Application will be made to the Listing Committee of the Hong Kong Stock Exchange for listing of and permission to deal in the new Shares, and to LSE for the admission to trading of the new Shares on AIM, to be issued pursuant to the Scrip Dividend Scheme in the stock exchanges respectively. The Scrip Dividend Scheme is conditional on the Shareholders resolving at the Annual General Meeting that the 2008 Final Dividend be satisfied wholly in the form of an allotment of Shares credited as fully paid up without offering any right to Shareholders to elect to receive such dividend in cash in lieu of such allotment and upon listing approval being granted by the Listing Committee of the Hong Kong Stock Exchange in respect of the new Shares to be issued pursuant thereto. A circular in relation to the Annual General Meeting and the relevant form of proxy or form of direction (as the case may be) were despatched to Shareholders on 18 March 2009. The share certificates for the new Shares are expected to be posted to the Shareholders entitled thereto at their own risk on or around Wednesday, 29 April 2009. It is expected that dealings in the new Shares on the Hong Kong Stock Exchange and the LSE will commence on Wednesday, 29 April 2009 and that the CREST accounts of holders of Depository Interests representing will be credited with new Depository Interests representing the new Shares on Wednesday, 29 April 2009.

Advantage of Scrip Dividend Scheme

The Scrip Dividend Scheme will give Shareholders an increased investment in the Company as provided above, without incurring brokerage fees and stamp duty cost. The Scrip Dividend Scheme will also benefit the Company because, the cash which would otherwise be used to satisfy the 2008 Final Dividend will be retained for use by the Company and will strengthen its permanent capital.

The Memorandum of Association and Bye-laws of the Company and Bermuda Company law

Please refer to Appendix V of the listing document of the Company dated 4 February 2009 headed ''Summary of the Memorandum and Bye-laws of the Company, Bermuda Company Law and the AIM Rules'' for a summary of certain provisions of the Memorandum of Association and Bye-laws of the Company and of certain aspect of the Companies Act 1981 of Bermuda.

A copy of the Companies Act 1981 of Bermuda will be available for inspection at the offices of Richards Butler in association with Reed Smith LLP at 20/F, Alexandra House, 16-20 Chater Road, Central, Hong Kong during normal business hours up to and including the date which is 14 days from the date of this circular.

Expected Timetable

2009

First day of dealings in Shares on an ex-entitlement basis in Hong Kong and the UK	Monday, 30 March
Last day for lodging transfer of Shares in order to qualify for the Scrip Dividend Scheme	Tuesday, 31 March
Register of members of the Company closes (both dates inclusive)	From Wednesday, 1 April  to Friday, 3 April
Record Date	Close of business on Friday, 3 April
Register of members re-opens	Monday, 6 April
Despatch of Scrip Dividend Circular to Shareholders	Monday, 6 April
Date of the Annual General Meeting	Tuesday, 21 April
Announcement of results of Annual General Meeting	before 9:00 a.m. (Hong Kong time) Wednesday, 22 April
	by 7:00 a.m. (UK time) Wednesday,  22 April
Despatch of Share certificates to Shareholders on	Wednesday, 29 April
Commencement of dealings in the new Shares on the Hong Kong Stock Exchange and the LSE	Wednesday, 29 April
CREST accounts of holders of Depository Interests will be credited with new Depository Interests representing the new Shares	Wednesday, 29 April

Notes:

- Conditional upon Shareholder's approval of the Scrip Dividend Scheme at the Annual General Meeting.

- If any of the above times or dates should change, an announcement will be made by the Company.

Yours faithfully,
On behalf of the Board
RCG Holdings Limited

Chau Pak Kun
Director

- Ends -

  For further information:

RCG Holdings Limited
Anita Chau, Deputy Chairman & COO KC Chong, Chief Financial Officer	Tel: + 852 3669 6999
email: ir@rcg.tv

Investec Investment Banking
Erik Anderson / Andrew Pinder / Rowena Murray	Tel: +44 (0) 20 7597 5000

Media enquiries:

Abchurch Communications Ltd
Chris Lane / George Parker / Monique Tsang	Tel: +44 (0) 20 7398 7712
email: monique.tsang@abchurch-group.com

About RCG

RCG is an international provider of biometric and RFID products and solution services with a primary focus in the Asia Pacific markets. The Company aims to develop new applications and revenue streams for global roll-out, particularly in the security applications industry.

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