Crypto Flow Technology Limited — AGM Information 2011

Mar 30, 2011

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, 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 MelcoLot Limited (the “ Company ”), you should at once hand this circular together with the accompanying form of proxy to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the 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.

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MelcoLot Limited

(incorporated in the Cayman Islands with limited liability) (Stock Code: 8198)

PROPOSALS FOR

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, REFRESHMENT OF THE LIMIT OF THE EXISTING SHARE OPTION SCHEME, RE-ELECTION OF DIRECTORS AND

NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of the Company (the “ AGM ”) to be held at Units 3101-2A, 31st Floor, The Centrium, 60 Wyndham Street, Central, Hong Kong on Thursday, 12 May 2011 at 11:30 a.m. is set out on pages 16 to 20 of this circular. Whether or not you are able to attend the AGM, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding of the AGM or any adjournment thereof. Completion and return of the accompanying form of proxy will not preclude you from attending and voting in person at the AGM or any adjournment thereof should you so wish.

This circular will remain on the “Latest Company Announcements” page of the GEM website at www.hkgem.com for a minimum period of 7 days from the date of its publication and on the Company’s website at www.melcolot.com.

Hong Kong, 31 March 2011

CHARACTERISTICS OF GEM

GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM.

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CONTENTS

	Page
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Proposed general mandates to issue and repurchase shares . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Proposed refreshment of the limit of the existing share option scheme . . . . . . . . . . . . . . . . .	5
Re-election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
AGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Responsibility statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
Appendix I – Explanatory statement to repurchase mandate. . . . . . . . . . . . . . . . . . . . . .	9
Appendix II – Details of Directors proposed to be re-elected . . . . . . . . . . . . . . . . . . . . . . .	13
Notice of AGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

ii

DEFINITIONS

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

“AGM” the annual general meeting of the Company to be held at Units 3101-2A, 31st Floor, The Centrium, 60 Wyndham Street, Central, Hong Kong on Thursday, 12 May 2011 at 11:30 a.m. “AGM Notice” the notice convening the AGM as set out on pages 16 to 20 of this circular “Annual Report” the annual report of the Company for the year ended 31 December 2010 “Articles of Association” the articles of association of the Company as may be amended or “Article(s)” from time to time “associate(s)” has the meaning ascribed to it under the GEM Listing Rules “Board” the board of Directors or a duly authorized committee thereof from time to time “Company” MelcoLot Limited, a company incorporated in the Cayman Islands with limited liability, the issued shares of which are listed on GEM “Directors” the directors of the Company from time to time “Eligible Participant(s)” any employee, Director, adviser or business consultant of the Company or any of its subsidiaries as determined by the Board at its absolute discretion

• “Existing Scheme Limit” the existing scheme limit under the Existing Share Option Scheme refreshed by the Shareholders at the annual general meeting of the Company on 11 May 2010, which set out the maximum number of share options that may be granted by the Company to the Eligible Participants, being 10% of the issued share capital of the Company as at the date of such refreshment

• “Existing Share Option Scheme” the existing share option scheme of the Company approved by the Shareholders on 20 April 2002

• “GEM” the Growth Enterprise Market of the Stock Exchange

“GEM Listing Rules” the Rules Governing the Listing of Securities on GEM as may be amended from time to time

“Group”

the Company and its subsidiaries

1

DEFINITIONS

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

• “Latest Practicable Date” 25 March 2011, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular

• “New Issue Mandate” a proposed general unconditional mandate to be granted to the Directors to exercise the power of the Company to allot, issue and deal with Shares during the period as set out in Ordinary Resolution no. 4 in the AGM Notice up to twenty percent (20%) of the issued share capital of the Company as at the date of passing such Ordinary Resolution

• “Ordinary Resolution(s)” the proposed ordinary resolution(s) as referred to in the AGM Notice

• “Pre-IPO Share Option Scheme” the pre-IPO share option scheme adopted by the Company on 20 April 2002

• “Proposed Refreshment” the proposed refreshment of the maximum limit on number of Shares of which 35,509,079 Shares, representing approximately 7.06% of the issued share capital of the Company as at the Latest Practicable Date, which may be issued by the Directors under the Existing Share Option Scheme at the AGM

• “Repurchase Mandate” a proposed general unconditional mandate to be granted to the Directors to exercise the power of the Company to repurchase Shares during the period as set out in Ordinary Resolution no. 5 in the AGM Notice up to ten percent (10%) of the issued share capital of the Company as at the date of passing such Ordinary Resolution

• “SFO” Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong)

• “Share(s)”

• share(s) of HK$0.01 each in the capital of the Company

• “Shareholders”

• holders of Share(s)

• “Stock Exchange”

• The Stock Exchange of Hong Kong Limited

• “Takeovers Code”

• the Hong Kong Code on Takeovers and Mergers

• “HK$” Hong Kong dollars, the lawful currency of Hong Kong

• “%”

per cent.

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LETTER FROM THE BOARD

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MelcoLot Limited

(incorporated in the Cayman Islands with limited liability) (Stock Code: 8198)

Executive Directors: Mr. Ko Chun Fung, Henry (Chief Executive Officer) Mr. Moumouris, Christos

Non-executive Directors: Mr. Chan Sek Keung, Ringo (Chairman) Mr. Wang, John Peter Ben

Independent non-executive Directors: Mr. Tsoi, David Mr. Pang Hing Chung, Alfred Mr. So Lie Mo, Raymond

Registered office: 4th Floor, Scotia Centre P.O. Box 2804 George Town Grand Cayman Cayman Islands

Head office and principal place of business in Hong Kong: Units 3101-2A, 31st Floor The Centrium 60 Wyndham Street Central, Hong Kong

31 March 2011

To the Shareholders

Dear Sir or Madam,

PROPOSALS FOR

GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES, REFRESHMENT OF THE LIMIT OF THE EXISTING SHARE OPTION SCHEME, RE-ELECTION OF DIRECTORS

AND NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information regarding Ordinary Resolutions to be proposed at the AGM for, inter alia, (i) the granting to the Directors of general mandates for the issue and repurchase of Shares; (ii) the extension of the general mandates to issue additional Shares; (iii) the refreshment of the limit of the Existing Share Option Scheme; and (iv) the re-election of three Directors and the other relevant information regarding the AGM.

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LETTER FROM THE BOARD

PROPOSED GENERAL MANDATES TO ISSUE AND REPURCHASE SHARES

At the annual general meeting held on 11 May 2010, resolutions were passed by the then Shareholders giving general unconditional mandates to the Directors to:

• (a) allot, issue and deal with Shares with a total nominal value not exceeding twenty percent (20%) of the total issued share capital of the Company as at the date of passing of the relevant Ordinary Resolution approving such new issue mandate;

• (b) repurchase such number of Shares representing up to ten percent (10%) of the total issued share capital of the Company as at the date of passing of the relevant Ordinary Resolution approving such repurchase mandate; and

• (c) add to the general mandate for issuing Shares set out in paragraph (a) above an amount representing the aggregate nominal value of the share capital of the Company repurchased by the Company pursuant to the repurchase mandate set out in paragraph (b) above.

The above mentioned general mandates will expire at the conclusion of the AGM to be held on Thursday, 12 May 2011. It is therefore proposed to seek your approval to renew these general mandates at the AGM.

The Appendix I to this circular contains an explanatory statement to Repurchase Mandate, as required by Rule 13.08 of the GEM Listing Rules, to provide the requisite information to the Shareholders to enable the Shareholders to make an informed decision on whether to vote for or against the Ordinary Resolution in relation to the Repurchase Mandate.

New Issue Mandate

At the AGM, an Ordinary Resolution will be proposed to grant to the Directors the New Issue Mandate, details of which are set out in Ordinary Resolution no. 4 in the AGM Notice. The Shares which may be allotted, issued and dealt with pursuant to the New Issue Mandate is limited to a maximum of twenty percent (20%) of the issued share capital of the Company as at the date of passing of the Ordinary Resolution approving the New Issue Mandate. In addition, conditional upon the Ordinary Resolutions to grant to the Directors the New Issue Mandate and the Repurchase Mandate being passed, an Ordinary Resolution will be proposed that the New Issue Mandate be extended so as to authorize the Directors to allot, issue and otherwise deal with further Shares up to an aggregate nominal amount equal to the aggregate nominal amount of the share capital of the Company repurchased by the Company under the Repurchase Mandate.

Based on the 502,966,933 Shares in issue as at the Latest Practicable Date and on the basis that no further Shares will be issued and/or repurchased by the Company between the Latest Practicable Date and the date of the AGM, if the New Issue Mandate is approved at the AGM, the total number of new Shares that may be issued under the New Issue Mandate will be 100,593,386 Shares, representing 20% of the 502,966,933 Shares in issue as at the date of the AGM. If the New Issue Mandate is approved by the Shareholders at the AGM, it will be and will continue to be in force from the date of the AGM until the

4

LETTER FROM THE BOARD

earliest of (i) the conclusion of the next annual general meeting of the Company; or (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Company’s Articles of Association or any applicable laws of the Cayman Islands to be held; or (iii) the passing of an Ordinary Resolution by the Shareholders in a general meeting revoking or varying such mandate, whichever occurs first.

Repurchase Mandate

At the AGM, an Ordinary Resolution will be proposed to grant to the Directors the Repurchase Mandate, details of which are set out in Ordinary Resolution no. 5 in the AGM Notice. The Shares which may be repurchased pursuant to the Repurchase Mandate is limited to a maximum of ten percent (10%) of the issued share capital of the Company as at the date of passing of the Ordinary Resolution approving the Repurchase Mandate.

With respect to the New Issue Mandate and the Repurchase Mandate, the Directors confirm that they have no current intention of exercising them.

PROPOSED REFRESHMENT OF THE LIMIT OF THE EXISTING SHARE OPTION SCHEME

The Pre-IPO Share Option Scheme and the Existing Share Option Scheme were adopted pursuant to ordinary resolutions passed by the Shareholders on 20 April 2002 respectively. Pursuant to the Pre-IPO Share Option Scheme and the Existing Share Option Scheme, the Directors were authorized to grant share options to the Eligible Participants to subscribe for Shares thereunder and to allot, issue and deal with Shares pursuant to the exercise of the share options granted under the Pre-IPO Share Option Scheme and the Existing Share Option Scheme, and the maximum number of Shares to be issued upon exercise of all outstanding options granted and yet to be exercised under the Pre-IPO Share Option Scheme, the Existing Share Option Scheme and any other share option scheme of the Group must not in aggregate exceed 30% of the issued share capital of the Company from time to time.

Under the Pre-IPO Share Option Scheme, share options carrying the rights to subscribe for 11,913,000 Shares were granted, of which 5,300,000 were exercised, 3,000,000 were outstanding and 3,613,000 were lapsed (representing approximately 1.05%, 0.60% and 0.72% respectively of the issued share capital of the Company as at the Latest Practicable Date).

Under the initial limit (the “ Initial Limit ”) of the Existing Share Option Scheme, the Company may grant options of up to 10% (equivalent to 27,826,000 Shares) of the issued share capital of the Company as at the date of placing under the prospectus of the Company dated 10 May 2002, and share options carrying the rights to subscribe for 13,136,000 Shares were granted, of which 6,901,000 were exercised, 1,200,000 were outstanding and 5,035,000 were lapsed (representing approximately 1.37%, 0.24% and 1.00% respectively of the issued share capital of the Company as at the Latest Practicable Date).

5

LETTER FROM THE BOARD

At the annual general meeting of the Company on 25 April 2003, the Initial Limit was refreshed (the “ Second Limit ”) and the Existing Scheme Limit was approved by the Shareholders. Under the Second Limited, the Company may grant options of up to 10% (equivalent to 28,226,800 Shares) of the issued share capital of the Company as at the date of such refreshment, and share options carrying the rights to subscribe for 15,855,000 Shares were granted, of which 6,912,250 were exercised, 1,275,000 were outstanding and 7,667,750 were lapsed, representing approximately 1.37%, 0.25% and 1.52% respectively of the issued share capital of the Company as at the Latest Practicable Date.

At the extraordinary general meeting of the Company on 20 February 2008, the Second Limit was refreshed (the “ Third Limit ”) and the Existing Scheme Limit was approved by the Shareholders. Under the Third Limit, the Company may grant options of up to 10% (equivalent to 43,415,149 Shares) of the issued share capital of the Company as at the date of such refreshment, and share options carrying the rights to subscribe for 43,000,000 Shares were granted, of which none were exercised, 37,868,000 were outstanding and 5,132,000 were lapsed, representing 0%, approximately 7.53% and 1.02% respectively of the issued share capital of the Company as at the Latest Practicable Date.

At the annual general meeting of the Company on 8 May 2009, the Third Limit was refreshed (the “ Fourth Limit ”) and the Existing Scheme Limit was approved by the Shareholders. Under the Fourth Limit, the Company may grant options of up to 10% (equivalent to 50,051,543 Shares) of the issued share capital of the Company as at the date of such refreshment, and share options carrying the rights to subscribe for 34,968,000 Shares were granted, of which none were exercised, 32,848,000 were outstanding and 2,120,000 were lapsed, representing 0%, approximately 6.53% and 0.42% respectively of the issued share capital of the Company as at the Latest Practicable Date.

At the annual general meeting of the Company on 11 May 2010, the Fourth Limit was refreshed and the Existing Scheme Limit was approved by the Shareholders. Under the Existing Scheme Limit, the Company may grant options of up to 10% (equivalent to 50,262,193 Shares) of the issued share capital of the Company as at the date of such refreshment, and share options carrying the rights to subscribe for 39,190,000 Shares were granted, of which none were exercised, 39,190,000 were outstanding and none were lapsed, representing 0%, approximately 7.79% and 0% respectively of the issued share capital of the Company as at the Latest Practicable Date. The share options carrying the rights to subscribe for 11,072,193 Shares were available for grating by the Company as at the Latest Practicable Date.

Reasons for the Proposed Refreshment

The Pre-IPO Share Option Scheme and the Existing Share Option Scheme were adopted by the Company to recognise past contributions and to encourage the Eligible Participants to achieve long term performance targets set by the Group and at the same time allows the Eligible Participants to enjoy the results of the Company attained through their efforts and contribution. As at the Latest Practicable Date, there are 115,381,000 outstanding share options, which the Company may grant to the Eligible Participants under the Existing Scheme Limit, representing approximately 22.94% of the issued share capital of the Company as at the Latest Practicable Date. The Directors consider that the share option scheme is a cost effective way to reward Eligible Participants who have made contributions to the Group and the Company should refresh the Existing Scheme Limit so that the Company could have more flexibility to provide incentives to and motivates those Eligible Participants under the Pre-IPO Share Option Scheme and/or the Existing Share Option Scheme by way of granting share options to them.

6

LETTER FROM THE BOARD

If the refreshment of the Existing Scheme Limit is approved at the AGM, based on the 502,966,933 Shares in issue as at the Latest Practicable Date and assuming no further Shares will be allotted and issued up to the date of the AGM, the Company will be authorized to grant share options under the Existing Share Option Scheme for subscription of up to a maximum number of 50,296,693 Shares, representing approximately 10% of the issued share capital of the Company as at the date of AGM. However, the maximum number of Shares which may be issued upon exercise of all outstanding Options granted under the Pre-IPO Share Option Scheme and the Existing Share Option Scheme and any other share option schemes of the Company must not exceed 30% of the Shares in issue from time to time, the Directors will only be allowed to grant further Options carrying the rights to subscribe for a maximum of 35,509,079 Shares. As such, the Board proposes to refresh the Existing Scheme Limit to the effect that the maximum number of Shares which may be issued upon the exercise of all the Options to be granted under the Existing Scheme Limit as refreshed will be 35,509,079 Shares (assuming no further issue or repurchase of Shares prior to the AGM), representing approximately 7.06% of the issued share capital of the Company as at the date of the approval of the Proposed Refreshment by the Shareholders at the AGM. As at the Latest Practicable Date, the Company has not adopted any share option schemes other than the Pre-IPO Share Option Scheme and the Existing Share Option Scheme.

Pursuant to the GEM Listing Rules, the Shares which may be issued upon exercise of all outstanding options granted and yet to be exercised under the Existing Share Option Scheme or other schemes at any time will not exceed 30% of the Shares in issue from time to time. The Board undertakes that no options shall be granted under the Existing Share Option Scheme or any scheme(s) of the Company if this will result in the 30% limit being exceeded.

Conditions of the Proposed Refreshment

The Proposed Refreshment is conditional upon:

1. the passing of the Ordinary Resolution by the Shareholders at the AGM to approve the Proposed Refreshment; and

2. the GEM Listing Committee of the Stock Exchange granting the listing of, and permission to deal in any new Shares which may be issued and allotted upon the exercise of the subscription rights attaching to the options that may be granted under the refreshed limit of the Existing Share Option Scheme, up to 10% of the issued share capital of the Company as at the date of passing of the relevant resolution at the AGM.

Application will be made to the GEM Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Shares, representing approximately 7.06% of the Shares in issue i.e. 35,509,079 Shares at the AGM, which may fall to be issued upon the exercise of options to be granted under the refreshed Existing Scheme Limit.

RE-ELECTION OF DIRECTORS

In accordance with Article 87 of the Articles of Association, Mr. Moumouris, Christos, Mr. Tsoi, David and Mr. Pang Hing Chung, Alfred retire by rotation and, being eligible, offer themselves for reelection at the AGM.

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LETTER FROM THE BOARD

Brief biographical details of the retiring Directors proposed for re-election at the AGM are set out in Appendix II of this circular.

AGM

The notice convening the AGM is set out on pages 16 to 20 of this circular and a form of proxy for use at the AGM is also enclosed with this circular. To be valid, the enclosed form of proxy, together with any power of attorney or other authority under which it is signed must be completed in accordance with the instructions printed thereon and delivered to the branch share registrar of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the AGM or any adjourned meeting. The completion and return of the form of proxy will not preclude you from attending and voting at the AGM or any adjourned meeting in person if you so wish.

According to Rule 17.47(4) of the GEM Listing Rules, any voting of the Shareholders at the AGM will be taken by way of poll and an announcement will be made after the AGM on the results of the AGM. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder will be required to abstain from voting on any resolutions to be approved at the AGM.

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

RECOMMENDATION

The Directors are of the opinion that the above proposals for general mandates to issue and repurchase Shares, extend the general mandate to issue Shares to cover Shares repurchased, refreshment of the limit of the Existing Share Option Scheme and re-election of Directors are in the best interests of the Company and the Shareholders and therefore recommend the Shareholders to vote in favour of the resolutions at the AGM.

Yours faithfully,

For and on behalf of the Board of MelcoLot Limited Ko Chun Fung, Henry

Executive Director and Chief Executive Officer

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APPENDIX I EXPLANATORY STATEMENT TO REPURCHASE MANDATE

This is an explanatory statement given to all Shareholders relating to the Ordinary Resolution to be proposed at the AGM authorizing the Repurchase Mandate. This explanatory statement contains all the information required pursuant to Rule 13.08 of the GEM Listing Rules and other relevant provisions of the GEM Listing Rules.

1. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Company comprised 502,966,933 Shares.

Subject to the passing of the Ordinary Resolution no. 5 in the AGM Notice and on the basis that no further Shares are issued or repurchased by the Company prior to the AGM, the Company would be allowed under the Repurchase Mandate to repurchase a maximum of 50,296,693 Shares, representing approximately 10% of the issued share capital of the Company during the period from the date of the passing of such Ordinary Resolution until (i) the conclusion of the next annual general meeting of the Company; (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association or any applicable laws of the Cayman Islands to be held; or (iii) the revocation, variation or renewal of the Repurchase Mandate by Ordinary Resolution of the Shareholders in general meeting, whichever occurs first.

2. REASON FOR REPURCHASES

The Directors believe that it is in the best interests of the Company and the Shareholders for the Directors to have general authority from Shareholders to enable the Company to repurchase Shares in the market. Repurchases of Shares will only be made when the Directors believe that such repurchase will benefit the Company and the Shareholders. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value and/or its earnings per Share of the Company.

3. FUNDING OF REPURCHASES

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with its memorandum of association and Articles of Association, the GEM Listing Rules and the applicable laws and regulations of the Cayman Islands. The Company may not repurchase its own Shares on GEM for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange from time to time.

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 financial statements contained in the Annual Report) in the event that the Repurchase Mandate is exercised in full. However, the Directors do not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or on the gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

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EXPLANATORY STATEMENT TO REPURCHASE MANDATE

APPENDIX I

4. SHARE PRICES

The highest and lowest prices at which the Shares have traded on GEM in each of the previous twelve months preceding the Latest Practicable Date were as follows:

Month	Highest	Lowest
	HK$	HK$
2010
March	0.360	0.270
April	0.340	0.270
May	0.295	0.190
June	0.295	0.204
July	0.260	0.228
August	0.260	0.188
September	0.325	0.179
October	0.213	0.154
November	0.178	0.127
December	0.160	0.125
2011
January	0.186	0.133
February	0.166	0.129
March (up to the Latest Practicable Date)	0.147	0.120

5. DIRECTORS’ UNDERTAKING

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the Repurchase Mandate in accordance with the GEM Listing Rules, the memorandum of association and Articles of Association and the applicable laws of the Cayman Islands.

6. THE TAKEOVERS CODE

If as a result of a repurchase of Shares, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of Rule 32 of the Takeovers Code. As a result, 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 Shareholder’s interests, could obtain or consolidate control of the Company and become(s) obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

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APPENDIX I EXPLANATORY STATEMENT TO REPURCHASE MANDATE

As at the Latest Practicable Date, the following Shareholders are interested in more than 10% of the Shares in issue and in the event that the Directors exercise in full the power to repurchase Shares in accordance with the Repurchase Mandate, the percentage interest in the Shares:

			Approximate
			percentage of
		Approximate	interest when
		percentage of	exercise in full
		issued share	the power
		capital of the	to repurchase
Name of Shareholder	Number of Shares	Company	Shares
		(Note 1)
Melco International Development	58,674,619	11.67%	12.96%
Limited (“Melco International”)	(Note 2)
Mr. Ho, Lawrence Yau Lung	58,674,619	11.67%	12.96%
(“Mr. Ho”)	(Note 3)
Mr. Chan Sek Keung, Ringo	53,276,000	10.59%	11.77%
(“Mr. Chan”)	(Note 4)
Intralot S.A. Integrated Lottery	52,973,779	10.53%	11.70%
Systems and Services	(Note 5)
(“Intralot S.A.”)

Notes:

• (1) As at the Latest Practicable Date, the total number of issued shares of the Company was 502,966,933.

• (2) Melco International is deemed by the SFO to be interested in 58,674,619 Shares by virtue of its indirect holding of its wholly owned subsidiaries, Melco Leisure and Entertainment Group Limited and Melco LottVentures Holdings Limited.

• (3) Mr. Ho is deemed by the SFO to be interested in 58,674,619 Shares by virtue of his controlling interests in Melco International, which is held by his controlled corporations, and his indirect holding of Melco Leisure and Entertainment Group Limited and Melco LottVentures Holdings Limited.

• (4) Mr. Chan, chairman and non-executive Director, is deemed, by virtue of the SFO, to be interested in the 34,400,000 Shares held by Woodstock Management Limited, a company wholly-owned by him, in addition to 18,876,000 Shares held by him personally.

• (5) Intralot S.A. is deemed by the SFO to be interested in 52,973,779 shares by virtue of its indirect holding of its wholly owned subsidiaries, Intralot Holdings International Limited and Intralot International Limited.

The Directors are not aware of any consequences which may arise under the Takeovers Code as a consequence of any purchase made under the Repurchase Mandate. However, the Company may not repurchase Shares which would result in the number of Shares held by the public being reduced to less than 25 per cent.

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APPENDIX I EXPLANATORY STATEMENT TO REPURCHASE MANDATE

The GEM Listing Rules prohibit the Company from knowingly purchasing its securities on GEM from a “connected person”, that is, a director, chief executive or substantial shareholder of the Company or any of its subsidiaries or their respective associates.

None of the Directors nor, to the best of their knowledge, having made all reasonable enquiries, any of their associates (as defined in the GEM Listing Rules) have any present intention to sell Shares to the Company or its subsidiaries under the Repurchase Mandate if such is approved by the Shareholders.

No connected person (as defined in the GEM Listing Rules) of the Company has notified the Company that it has a present intention to sell Shares to the Company or its subsidiaries, or has undertaken not to do so, in the event that the Repurchase Mandate is approved by the Shareholders.

7. SHARES REPURCHASE MADE BY THE COMPANY

No repurchases of Shares have been made by the Company (whether on the GEM or otherwise) during the six months immediately preceding the Latest Practicable Date.

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APPENDIX II DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

1. Mr. Moumouris, Christos

Mr. Moumouris, aged 42, is an executive Director of the Company and a member of the nomination committee of the Board. Mr. Moumouris was first appointed to the board in January 2009. He retires by rotation under Article 87 of the Articles of Association and, being eligible, offers himself for re-election. Apart from being a Director of the Company, Mr. Moumouris did not hold any directorship in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the past three years.

Mr. Moumouris is representing Intralot S.A., a substantial shareholder of the Company, and is currently the CEO and a director of Intralot Nederland BV, Director, International Markets of Intralot Interactive S.A. (I²) and a director of Intralot Korea. He served as Managing Director of Intralot Asia Pacific Ltd. (Hong Kong), where he remains as a director, and served as director in the boards of Intralot South Africa and Gidani (the South Africa National Lottery Operator). On 15 January 2009, Mr. Moumouris was appointed a director of PAL Development Limited, PALTECH Company Limited and PAL (Beijing) Information Technology Ltd., all are subsidiaries of the Company.

Mr. Moumouris holds a Bachelor of Electronic Engineering with Honours from the University of Westminster in London, England and a Master in Electronic Engineering from the Eindhoven University of Technology in the Netherlands.

There is no service contract entered into between Mr. Moumouris and the Company and has no fixed term of service with the Company but he is subject to retirement by rotation and re-election at the annual general meeting of the Company in accordance with the Articles. Both the Company and Mr. Moumouris are entitled to terminate the appointment at any time by giving notice to other party in writing. There is no emolument in connection with his position as an executive Director. Any future remuneration to Mr. Moumouris will be determined by the remuneration committee with reference to his duties and level of responsibilities, the remuneration policy of the Company and the prevailing market conditions.

Mr. Moumouris’ interests in the Shares, within the meaning of Part XV of the SFO as at the Latest Practicable Date are (i) 2,120,000 share options granted to him on 16 February 2009 at the exercise price of HK$0.300 per Share, (ii) 2,500,000 share options granted to him on 10 July 2009 at the exercise price of HK$0.367 per Share and (iii) 1,000,000 share options granted to him on 18 November 2010 at the exercise price of HK$0.152 per Share. The above options granted to Mr. Moumouris will expire, if not exercised, on the anniversary of 10 years from the date of grant. Save as disclosed, Mr. Moumouris does not have any other interest in the securities within the meaning of Part XV of the SFO.

Save as those disclosed above, Mr. Moumouris does not have any relationships with any Directors, senior management or substantial or controlling Shareholders and there is no other information required to be disclosed pursuant to the requirements of rule 17.50(2)(h) to 17.50(2)(v) of the GEM Listing Rules.

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DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

APPENDIX II

2. Mr. Tsoi, David

Mr. Tsoi, aged 63, is an independent non-executive Director and chairman of both the audit committee and remuneration committee and a member of the nomination committee of the Board. Mr. Tsoi was first appointed to the Board in October 2001. He retires by rotation under Article 87 of the Articles of Association and, being eligible, offers himself for re-election.

Apart from being a Director, Mr. Tsoi is an independent non-executive director of CSR Corporation Limited (formerly known as “China South Locomotive & Rolling Stock Corporation Limited”) and Enviro Energy International Holdings Limited, both listed on the main board of the Stock Exchange. Save as disclosed above, Mr. Tsoi did not hold any directorship in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the past three years.

Mr. Tsoi is a Certified Public Accountant by profession, and he is now practising as managing director of Alliott, Tsoi CPA Limited. Mr. Tsoi is a fellow member of the Association of Chartered Certified Accountants, Hong Kong Institute of Certified Public Accountants and an associate member of the Association of Certified General Accountants of Canada and Institute of Chartered Accountants of England & Wales. Mr. Tsoi is also a fellow member of the Hong Kong Institute of Directors and CPA Australia. Mr. Tsoi holds a Master’s degree in Business Administration from the University of East Asia, Macau.

Mr. Tsoi has entered into a letter of appointment with the Company for a term of two years commencing from 1 April 2010 to 31 March 2012 as an independent non-executive Director unless terminated by not less than one month’s notice in writing served by either party. Pursuant to the letter of appointment, Mr. Tsoi is entitled to an annual director’s fee of HK$144,000, which is determined by reference to the prevailing market conditions and his roles and responsibilities in the Company.

Mr. Tsoi’s interests in the Shares, within the meaning of Part XV of the SFO as at the Latest Practicable Date are (i) 976,000 Shares beneficially owned by him, (ii) 200,000 share options granted to him on 10 July 2009 at the exercise price of HK$0.367 per Share and (iii) 200,000 share options granted to him on 18 November 2010 at the exercise price of HK$0.152 per Share. The above options granted to Mr. Tsoi will expire, if not exercised, on the anniversary of 10 years from the date of grant. Save as disclosed, Mr. Tsoi does not have any other interest in the securities within the meaning of Part XV of the SFO.

Mr. Tsoi does not have any relationships with any Directors, senior management or substantial or controlling Shareholders and there is no other information required to be disclosed pursuant to the requirements of rule 17.50(2)(h) to 17.50(2)(v) of the GEM Listing Rules.

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APPENDIX II DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

3. Mr. Pang Hing Chung, Alfred

Mr. Pang, aged 49, is an independent non-executive Director and a member of both the audit committee and nomination committee of the Board. Mr. Pang was first appointed to the Board in March 1999. He retires by rotation under Article 87 of the Articles of Association and, being eligible, offers himself for re-election. Apart from being a Director of the Company, Mr. Pang is an independent nonexecutive director of Arnhold Holdings Limited, listed on the main board of the Stock Exchange. Save as disclosed above, Mr. Pang did not hold any directorship in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the past three years.

Mr. Pang holds dual Bachelor of Arts (in Economics) and Bachelor of Science (in Electrical Engineering) degrees from Cornell University, and an MBA degree from Stanford University Graduate School of Business in the United States.

Mr. Pang has entered into a letter of appointment with the Company for a term of two years commencing from 1 April 2010 to 31 March 2012 as an independent non-executive Director unless terminated by not less than one month’s notice in writing served by either party. Pursuant to the letter of appointment, Mr. Pang is entitled to an annual director’s fee of HK$120,000, which is determined by reference to the prevailing market conditions and his roles and responsibilities in the Company.

Mr. Pang’s interests in the Shares, within the meaning of Part XV of the SFO as at the Latest Practicable Date are (i) 1,500,000 Shares beneficially owned by him, (ii) 200,000 share options granted to him on 10 July 2009 at the exercise price of HK$0.367 per Share and (iii) 200,000 share options granted to him on 18 November 2010 at the exercise price of HK$0.152 per Share. The above options granted to Mr. Pang will expire, if not exercised, on the anniversary of 10 years from the date of grant. Save as disclosed, Mr. Pang does not have any other interest in the securities within the meaning of Part XV of the SFO.

Mr. Pang does not have any relationships with any Directors, senior management or substantial or controlling Shareholders and there is no other information required to be disclosed pursuant to the requirements of rule 17.50(2)(h) to 17.50(2)(v) of the GEM Listing Rules.

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NOTICE OF AGM

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MelcoLot Limited

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 8198)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the annual general meeting (the “ Meeting ”) of MelcoLot Limited (the “ Company ”) will be held at Units 3101-2A, 31st Floor, The Centrium, 60 Wyndham Street, Central, Hong Kong on Thursday, 12 May 2011 at 11:30 a.m. for the purpose of considering and, if thought fit, passing the following resolutions of the Company:

1. To consider and approve the audited financial statements and the reports of the directors and the auditors for the year ended 31 December 2010;

2. To re-elect the directors and to authorize the board of directors to fix the remuneration of the directors; (note 7)

3. To re-appoint the auditor and to authorize the board of directors to fix their remuneration; and

As special business, to consider and, if thought fit, pass the following resolutions as Ordinary Resolutions:

ORDINARY RESOLUTIONS

Grant of general mandate to issue shares

1. “ THAT :

2. (a) subject to paragraph (c) of this resolution, and pursuant to the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited, the exercise by the directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional shares in the capital of the Company and to make or grant, whether conditionally or unconditionally, offers, agreements and options (including warrants, bonds, debentures, notes and any securities which carry rights to subscribe for or are convertible into the shares in the Company) which would or might require the exercise of such powers, be and is hereby generally and unconditionally approved;

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NOTICE OF AGM

• (b) the approval in paragraph (a) of this resolution shall authorize the directors of the Company during the Relevant Period to make or grant offers, agreements and options (including warrants, bonds, debentures, notes and any securities which carry rights to subscribe for or are convertible into the shares in the Company) which would or might require the exercise of such powers after the end of the Relevant Period;

• (c) the aggregate nominal amount of share capital allotted, issued or dealt with or agreed conditionally or unconditionally to be allotted, issued or dealt with (whether pursuant to options or otherwise) by the directors of the Company pursuant to the approval in paragraph (a) of this resolution, otherwise than pursuant to (i) a Rights Issue (as hereinafter defined); or (ii) the grant or exercise of any option under any share option scheme of the Company or any other option, scheme or similar arrangement for the time being adopted for the grant or issue to employee, director, advisor or business consultant of the Company and/or any of its subsidiaries of shares in the Company or rights to acquire shares in the Company; or (iii) any scrip dividend or similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares in the Company in accordance with the Articles of Association of the Company in force from time to time; or (iv) any issue of shares in the Company upon the exercise of rights of subscription or conversion under the terms of any warrants or convertible bonds issued by the Company or any securities which carry rights to subscribe for or are convertible into shares in the Company, shall not exceed 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue on the date of the passing this resolution and the authority pursuant to paragraph (a) of this resolution shall be limited accordingly; and

• (d) for the purpose of this resolution,

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

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association of the Company or any applicable law of the Cayman Islands to be held; and

• (iii) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the directors of the Company by this resolution.

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NOTICE OF AGM

“Rights Issue” means an offer of shares in the Company, or offer or issue of warrants, options or other securities giving rights to subscribe for shares open for a period fixed by the directors of the Company to holders of shares in the Company on the register 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, or the expense or delay which may be involved in determining the existence or extent of any restrictions or obligations under the laws of, or the requirements of, any jurisdiction applicable to the Company, or any recognized regulatory body or any stock exchange in any territory applicable to the Company).”

Grant of the general mandate to repurchase shares

1. “ THAT :

2. (a) subject to paragraph (b) of this resolution, the exercise by the directors of the Company during the Relevant Period (as hereinafter defined) of all the powers of the Company to repurchase shares in the capital of the Company on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited or any other stock exchange on which the shares in the Company may be listed and recognised by the Securities and Futures Commission and The Stock Exchange of Hong Kong Limited for such purpose, subject to and in accordance with the rules and regulations of the Securities and Future Commission, The Stock Exchange of Hong Kong Limited, the Companies Law of the Cayman Islands and all other applicable laws in this regard, be and the same is hereby generally and unconditionally approved;

3. (b) the aggregate nominal amount of shares in the Company which the Company is authorized to repurchase pursuant to the approval in paragraph (a) of this resolution during the Relevant Period shall not exceed 10 per cent. of the aggregate nominal amount of the issued share capital of the Company as at the date of the passing of this resolution and the authority pursuant to paragraph (a) of this resolution shall be limited accordingly;

4. (c) for the purpose of this resolution,

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

• (i) the conclusion of the next annual general meeting of the Company;

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association of the Company or any other applicable law of the Cayman Islands to be held; and

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NOTICE OF AGM

• (iii) the passing of an ordinary resolution by the shareholders of the Company in general meeting revoking or varying the authority given to the directors of the Company by this resolution.”

Extension of Resolution 4 to number of shares repurchased in Resolution 5

1. “ THAT conditional upon the passing of resolution nos. 4 and 5 of the notice convening this meeting, the general mandate granted to the directors of the Company to allot, issue and deal with additional shares in the Company pursuant to the said resolution no. 4 be and is hereby extended by the addition thereto of an amount representing the aggregate nominal amount of shares in the capital of the Company which are repurchased by the Company under the authority granted to the directors of the Company pursuant to the said resolution no. 5.”

Refreshment of the limit of the existing share option scheme

1. “ THAT subject to and conditional upon the Listing Committee of The Stock Exchange of Hong Kong Limited granting approval for the listing of, and permission to deal in, the shares in the share capital of the Company to be issued pursuant to the exercise of share options which may be granted under the Refreshed Scheme Limit (as defined below), the refreshment of the limit in respect of the granting of share options under the Share Option Scheme of the Company adopted on 20 April 2002, up to 7.06% of the total number of shares of the Company in issue as at the date of passing of this resolution (the “ Refreshed Scheme Limit ”) be and is hereby approved; and that any director of the Company be and is hereby authorized to do all such acts and execute all such documents to effect the Refreshed Scheme Limit.”

By order of the Board of MelcoLot Limited Ko Chun Fung, Henry Executive Director and Chief Executive Officer

Hong Kong, 31 March 2011

Registered office: 4th Floor, Scotia Centre P.O. Box 2804 George Town Grand Cayman Cayman Islands

Head office and principal place of business in Hong Kong: Units 3101-2A, 31st Floor The Centrium 60 Wyndham Street Central, Hong Kong

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NOTICE OF AGM

Notes:

1. A shareholder entitled to attend and vote at the above Meeting is entitled to appoint one or more proxies to attend and vote instead of him. A proxy need not be a shareholder of the Company.

2. Where there are joint holders of any share of the Company, any one of such joint holders may vote at the Meeting, either personally or by proxy, in respect of such share as if he was solely entitled thereto, but if more than one of such joint holders be present at the Meeting personally or by proxy, that one of the said persons so present whose name stands first on the register of shareholders of the Company in respect of such share shall alone be entitled to vote in respect thereof.

3. The instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed, or a notarially certified copy of such power of attorney or authority, must be lodged with the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong for registration not less than 48 hours before the time appointed for holding the Meeting (or any adjournment thereof).

4. Completion and return of the form of proxy will not preclude a shareholder from attending the Meeting and voting in person at the Meeting or any adjournment thereof if he so desires. If a shareholder attends the Meeting after having deposited the form of proxy, his form of proxy will be deemed to have been revoked.

5. With regard to ordinary resolution no. 5 of this notice, an explanatory statement containing information regarding the repurchase by the Company of its own shares are set out in Appendix I to the circular of the Company to shareholders dated 31 March 2011 together with the 2010 Annual Report of the Company.

6. Article 66 of the Company’s articles of association sets out the procedure by which shareholders of the Company may demand a poll at general meetings.

According to Rule 17.47(4) of the GEM Listing Rules, any voting of the shareholders of the Company at the annual general meeting will be taken by way of a poll and an announcement of the voting results will be made after the annual general meeting. Accordingly, the resolutions will be taken by way of a poll at the annual general meeting.

1. The biographical details on Mr. Moumouris, Christos, Mr. Tsoi, David and Mr. Pang Hing Chung, Alfred are set out in Appendix II to the circular of the Company dated 31 March 2011.

2. The translation into Chinese language of this notice is for reference only. In case of any inconsistency, the English version shall prevail.

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