Da Sen Holdings Group Limited — Proxy Solicitation & Information Statement 2002

Jun 18, 2002

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

This circular is for information purposes only and does not constitute an invitation or offer to acquire or subscribe for securities.

If you are in any 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 ASIA TELE-NET AND TECHNOLOGY CORPORATION LIMITED , you should at once hand this circular to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale 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.

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(Incorporated in Bermuda with limited liability)

CONNECTED TRANSACTION

DISPOSAL OF AN 80% INTEREST IN A TELECOM CARRIER

Financial Adviser to Asia Tele-Net and Technology Corporation Limited

Karl Thomson Financial Advisory Limited

Independent Financial Adviser to the Independent Director

Barits Securities (Hong Kong) Limited

A letter from the independent director of Asia Tele-Net and Technology Corporation Limited is set out on page 20 of this circular.

A letter from Barits Securities (Hong Kong) Limited containing its recommendations to the independent director of Asia Tele-Net and Technology Corporation Limited is set out on pages 21 to 28 of this circular.

A notice convening a special general meeting of Asia Tele-Net and Technology Corporation Limited to be held at 2:00 p.m. on 5th July, 2002 at 11 Dai Hei Street, Tai Po Industrial Estate, New Territories is set out on page 34 of this circular.

17th June, 2002

Asia Tele-Net and Technology Corporation Limited

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
ATNT Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
WTF Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Relationship between the parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Description of ATNT, eCyber and WTF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Description of Sky Citi-Link . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Benefits of the transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Lockup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16
Changes in shareholding structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	17
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Letter from the Independent Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Letter of advice from Barits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21
Appendix — General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29
Notice of Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	34

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Asia Tele-Net and Technology Corporation Limited

DEFINITIONS

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

• “Accounts”

the unaudited consolidated balance sheet of the Sky Citi-Link Group as at 31st March, 2002 and the unaudited consolidated profit and loss account of the Sky Citi-Link Group for the financial year ended 31st March, 2002

• “associate(s)” has the meaning ascribed thereto under the Listing Rules

• “Auditors” auditors appointed by WTF to audit the Completion Accounts

• “ATNT”

• Asia Tele-Net and Technology Corporation Limited, a company incorporated in Bermuda with limited liability, the shares of which are listed on the Stock Exchange

• “ATNT Agreement” the agreement described under the section headed “ATNT Agreement” in this circular

• “ATNT WTF 31,272,727 out of the 107,272,727 Total WTF Consideration Consideration Shares” Shares

• “Barits”

• Barits Securities (Hong Kong) Limited, an investment adviser and a dealer registered under the Securities Ordinance, Chapter 333 of the Laws of Hong Kong, being the independent financial adviser to the Independent Director in relation to the Connected Transaction

• “Benevolent Developments” Benevolent Developments Limited, a company incorporated in the British Virgin Islands with limited liability which, together with its beneficial owner, are independent of and not connected with any of the directors, chief executives and substantial shareholders of WTF or its subsidiaries or their respective associates

• “Board”

• the board of Directors

• “Completion Accounts”

• the audited consolidated balance sheet of the Sky Citi-Link Group as at completion of the ATNT Agreement and WTF Agreement and the audited profit and loss account of the Sky Citi-Link Group for the period from 1st April, 2002 to completion of the ATNT Agreement and WTF Agreement prepared by Sky Citi-Link and audited by the Auditors

• “Connected Transaction”

• the disposal of an 80% interest in Sky Citi-Link by Happy Win pursuant to the ATNT Agreement to Teleinvest

• “Consideration Shares”

• ATNT WTF Consideration Shares and eCyber Consideration Shares

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Asia Tele-Net and Technology Corporation Limited

DEFINITIONS

“Director(s)”	the director(s) of ATNT
“eCyber”	eCyberChina Holdings Limited, a company incorporated in
	Hong Kong with limited liability, the shares of which are
	listed on the Stock Exchange
“eCyber Group”	eCyber and its subsidiaries
“eCyber Consideration Shares”	151,200,000 new eCyber Shares to be issued in accordance
	with the terms of ATNT Agreement
“eCyber Shares”	ordinary shares of HK$0.20 each in the issued share capital of
	eCyber
“eCyber WTF Consideration	76,000,000 out of the 107,272,727 Total WTF Consideration
Shares”	Shares
“First Placing Agreement”	the agreement dated 23rd April, 2002 and entered into
	between WTF and Benevolent Developments for the placing
	of 292,500,000 WTF Shares to Benevolent Developments
	and/or independent investors procured by it
“FTNS Licence”	the fixed telecommunication network services licence no. 018
	granted by OFTA to Sky Citi-Link International Telecom
	Limited with effect from 1st April, 2000 pursuant to the
	Telecommunication Ordinance, Chapter 106 of the Laws of
	Hong Kong
“Group”	ATNT and its subsidiaries
“Happy Win”	Happy Win Resources Limited, a company incorporated in the
	British Virgin Islands with limited liability and a wholly-
	owned subsidiary of ATNT
“Happy Win Loan”	80% of all amounts outstanding at completion of the ATNT
	Agreement as comprised in a loan in the amount of
	approximately HK$78,395,000 due from Sky Citi-Link to all
	shareholders as set out in the Accounts which is due and
	owing from Sky Citi-Link to Happy Win and Teleinvest at the
	date of the ATNT Agreement, which loan is interest free and
	repayable on demand subject to adjustment at completion of
	the ATNT Agreement by ATNT and irrevocably confirmed in
	writing by ATNT to Sky Citi-Link
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC
“Independent Director”	Mr. Kin Wai Cheung, the independent non-executive Director
	appointed to advise the Shareholders in relation to the
	Connected Transaction

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Asia Tele-Net and Technology Corporation Limited

DEFINITIONS

“Latest Practicable Date”	13th June, 2002, being the latest practicable date for
	ascertaining certain information contained in this circular
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“Milestone”	the full satisfaction by the licensee of the conditions set out
	in the schedule to the FTNS Licence relating to the licensee
	(a) having a capacity of not less than 120Mbps for external
	telecommunications circuits; and (b) having a cumulative
	capital expenditure of not less than HK$41 million within 30
	months from the date of issue of the FTNS License
“Mr Chu”	Mr Chu Yu Lin David, a director of WTF and, together with
	Mrs Chu and their respective associates, a substantial
	shareholder of WTF
“Mrs Chu”	Mrs Chu Ho Miu Hing, a director of WTF, the wife of Mr Chu
	and, together with Mr Chu and their respective associates, a
	substantial shareholder of WTF
“OFTA”	the Office of the Telecommunications Authority in Hong
	Kong
“PRC”	the People’s Republic of China
“SCLIT”	Sky Citi-Link International Telecom Limited, a company
	incorporated in Hong Kong with limited liability and a
	wholly-owned subsidiary of Sky Citi-Link
“Second Placing Agreement”	the agreement dated 24th April, 2002 and entered into
	between WTF and Well Growth for the placing of
	195,000,000 WTF Shares to Well Growth and/or independent
	investors procured by it
“Share(s)”	ordinary share(s) of HK$0.01 each in the issued share capital
	of ATNT
“Shareholders”	holders of Shares
“Sky Citi-Link”	Sky Citi-Link ATNT (Holdings) Limited, a company
	incorporated in the British Virgin Islands with limited
	liability and held as to 20% by Teleinvest and 80% by Happy
	Win as at the Latest Practicable Date
“Sky Citi-Link Group”	Sky Citi-Link and its subsidiaries
“Sky Citi-Link Shares”	shares of US$1.00 each in the issued share capital of Sky
	Citi-Link

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Asia Tele-Net and Technology Corporation Limited

DEFINITIONS

“Special General Meeting”	a special general meeting of ATNT to be convened to approve,
	among others, the Connected Transaction
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Teleinvest”	Teleinvest Holdings Limited, a company incorporated in the
	British Virgin Islands with limited liability and a wholly-
	owned subsidiary of eCyber
“Teleinvest Loan”	80% of all amounts outstanding at completion of the WTF
	Agreement as comprised in a loan in the amount of
	approximately HK$78,395,000 due from Sky Citi-Link to all
	shareholders as set out in the Accounts which is due and
	owing from Sky Citi-Link to Teleinvest at the date of the
	ATNT Agreement, which loan is interest free and repayable
	on demand subject to adjustment at completion of the WTF
	Agreement by ATNT and irrevocably confirmed in writing by
	ATNT to Sky Citi-Link
“Total WTF Consideration	a total of 107,272,727 new WTF Shares (comprising of the
Shares”	ATNT WTF Consideration Shares and eCyber WTF
	Consideration Shares) to be issued in accordance with the
	terms of the WTF Agreement
“Well Growth”	Well Growth Group Limited, a company incorporated in the
	British Virgin Islands with limited liability which, together
	with its beneficial owner, are independent of and not
	connected with any of the directors, chief executives and
	substantial shareholders of WTF or its subsidiaries or their
	respective associates
“WTF”	Wah Tak Fung Holdings Limited, a company incorporated in
	Bermuda with limited liability, the shares of which are listed
	on the Stock Exchange
“WTF Agreement”	the agreement described under the section headed “WTF
	Agreement” in this circular
“WTF Shares”	ordinary shares of HK$0.10 each in the issued share capital of
	WTF
“HK$”	Hong Kong dollars
“US$”	United States dollars

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

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(Incorporated in Bermuda with limited liability)

Executive Directors:

Kwok Yan Lam (Chairman) Kwok Hing Lam (Deputy Chairman & Managing Director)

Non-executive Director

Registered office: Clarendon House Church Street Hamilton HM11 Bermuda

Alan Wang Wai Kwan

Independent non-executive Directors: David Chi Kin Ng Kin Wai Cheung

Head office and principle place of business: 11 Dai Hei Street Tai Po Industrial Estate Tai Po, New Territories Hong Kong

17th June, 2002

To the Shareholders

Dear Sir or Madam,

CONNECTED TRANSACTION DISPOSAL OF AN 80% INTEREST IN A TELECOM CARRIER

1. INTRODUCTION

The ATNT Agreement

On 6th May, 2002, the directors of eCyber, WTF and ATNT jointly announced that on 1st May, 2002, the ATNT Agreement was entered into between ATNT, Happy Win, eCyber and Teleinvest. Pursuant to the ATNT Agreement, among other things, Happy Win agreed to sell and Teleinvest agreed to purchase or procure the purchase of:

• (a) 80 Sky Citi-Link Shares, representing 80% of the issued share capital of Sky Citi-Link; and

• (b) the Happy Win Loan.

The aggregate consideration is HK$55,000,000 and is to be satisfied by:

• (a) the issue of 151,200,000 eCyber Consideration Shares, credited as fully paid at HK$0.25 each (representing a premium of 23.76% over the closing price of the eCyber Shares of HK$0.202 on 30th April, 2002); and

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

• (b) eCyber procuring the issue of 31,272,727 ATNT WTF Consideration Shares by WTF, credited as fully paid at HK$0.55 each (representing a premium of 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, being the last trading day prior to the suspension of trading in WTF Shares on 21st March, 2002) to ATNT or as it may direct.

The eCyber Consideration Shares represent approximately 5.85% of the existing issued share capital of eCyber as at the Latest Practicable Date and 5.53% of the issued share capital of eCyber, as enlarged by the issue of the eCyber Consideration Shares.

The ATNT WTF Consideration Shares represents approximately 0.98% of the existing issued share capital of WTF as at the Latest Practicable Date and approximately 0.95% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares but excluding any WTF Shares to be issued under the First Placing Agreement and the Second Placing Agreement.

In view that Sky Citi-Link was held as to 80% and 20% by Happy Win and Teleinvest respectively, the disposal of a 80% interest in Sky Citi-Link by Happy Win to Teleinvest constitutes a connected transaction for ATNT under Chapter 14 of the Listing Rules and therefore is subject to, among other things, approval by Shareholders in the Special General Meeting. No Shareholder has to abstain from voting in the Special General Meeting.

The WTF Agreement

On 6th May, 2002, the directors of eCyber, WTF and ATNT jointly announced that on 1st May, 2002, the WTF Agreement was entered into between eCyber, Teleinvest and WTF pursuant to which, among other things, Teleinvest agreed to sell and WTF agreed to purchase or procure the purchase of:

• (a) 80 Sky Citi-Link Shares, representing 80% of the issued share capital of Sky Citi-Link; and

• (b) the Teleinvest Loan.

The aggregate consideration is HK$59,000,000. The consideration is to be satisfied by the issue of 107,272,727 Total WTF Consideration Shares, credited as fully paid at HK$0.55 each (representing a premium of approximately 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, being the last trading day prior to the suspension of trading in WTF Shares on 21st March, 2002) as to:

• (a) 76,000,000 eCyber WTF Consideration Shares to eCyber or as it may direct; and

• (b) 31,272,727 ATNT WTF Consideration Shares to ATNT or as it may direct, at the directions of eCyber.

eCyber took the role of introducing agent in the above two transactions in return for an agent fee of HK$4 million, which represented the difference between the considerations under each of the ATNT Agreement and the WTF Agreement.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

2. ATNT AGREEMENT

Date:

1st May, 2002

Parties: (1) ATNT (as guarantor for Happy Win);

• (2) Happy Win (as vendor);

• (3) eCyber (as guarantor for Teleinvest); and

• (4) Teleinvest (as purchaser).

Terms:

Happy Win agreed to sell and Teleinvest agreed to purchase or procure the purchase of 80 Sky Citi-Link Shares, representing 80% of the issued share capital of Sky Citi-Link, and the Happy Win Loan

Consideration:

HK$55,000,000 to be satisfied as follows:

• (i) the issue and allotment of 151,200,000 eCyber Consideration Shares, credited as fully paid at HK$0.25 each; and

• (ii) eCyber procuring the issue and allotment of 31,272,727 ATNT WTF Consideration Shares by WTF, credited as fully paid at HK$0.55 each;

to ATNT or as it may direct on completion of the ATNT Agreement.

The eCyber Consideration Shares

The 151,200,000 eCyber Consideration Shares represents approximately 5.85% of the existing issued share capital of eCyber as at the Latest Practicable Date and 5.53% of the issued share capital of eCyber, as enlarged by the issue of the eCyber Consideration Shares.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

The issue price of HK$0.25 per eCyber Consideration Shares represents (i) a premium of about 23.76% over the average closing price of the eCyber Shares from 17th April, 2002 to 30th April, 2002, being the 10 trading days before the date of the ATNT Agreement of HK$0.202; (ii) a premium of about 23.76% over the closing price of the eCyber Shares of HK$0.202 on 30th April, 2002; (iii) a premium of about 31.58% over the closing price of the eCyber Shares of HK$0.19 as at the Latest Practicable Date; and (iv) a premium of about 31.58% over the average closing price of of the eCyber Shares of HK$0.19 from 31st May, 2002 to 13th June, 2002, being the 10 trading days up to and including the Latest Practicable Date.

The ATNT WTF Consideration Shares

The 31,272,727 ATNT WTF Consideration Shares of 3,201,020,651 WTF Shares represent approximately 0.98% of the existing issued share capital of WTF as at the Latest Practicable Date and approximately 0.95% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares excluding any WTF Shares to be issued under the First Placing Agreement and the Second Placing Agreement.

The issue price of HK$0.55 per ATNT WTF Consideration Share represents (i) a premium of about 8.91% over the average closing price of the WTF Shares of HK$0.505 from 7th March, 2002 to 20th March, 2002, being the 10 trading days prior to the suspension of trading in WTF Shares on 21st March, 2002; (ii) a premium of about 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, being the last trading day prior to the suspension of trading in WTF Shares on 21st March, 2002; (iii) a premium of about 124.49% over the closing price of the WTF Shares of HK$0.245 as at the Latest Practicable Date; and (iv) a premium of about 126.34% over the average closing price of the WTF Shares of HK$0.243 from 31st May, 2002 to 13th June, 2002, being the 10 trading days up to and including the Latest Practicable Date.

Basis

The consideration (including the determination of the issue price of HK$0.25 per eCyber Consideration Share and HK$0.55 per ATNT WTF Consideration Share) was determined based on arms-length commercial negotiations

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

between the parties with reference to the adjusted net assets of the Sky Citi-Link Group (excluding its consolidated current assets, consolidated current liabilities, and shareholders loan of approximately HK$78,395,000 granted to it) as at 31st March, 2002 of approximately HK$64,842,000. The consideration of HK$55,000,000 for the acquisition of an 80% interest in Sky Citi-Link represents a premium of approximately 6% over approximately HK$51,873,600 being 80% of such adjusted net asets of the Sky Citi-Link Group as determined above.

Other terms:

• (i) In the event the value of the current assets of the Sky Citi-Link Group as at completion of the ATNT Agreement is less than its current liabilities (both as certified by the Auditors), ATNT and Happy Win shall pay or procure that the shortfall is paid in cash to Sky Citi-Link within 10 business days from the date the Completion Accounts are issued.

• (ii) In the event the value of the current assets of the Sky Citi-Link Group as at completion of the ATNT Agreement exceeds its current liabilities (both as certified by the Auditors), eCyber shall procure that the excess is paid in cash to ATNT within 10 business days from the date the Completion Accounts are issued.

Conditions

Completion of the ATNT Agreement is conditional upon the satisfaction of the following conditions:

• (i) the Stock Exchange granting a listing of and permission to deal in the eCyber Consideration Shares and the ATNT WTF Consideration Shares;

• (ii) approval by Shareholders at a general meeting to approve the ATNT Agreement and the transactions contemplated thereunder in accordance with the Listing Rules;

• (iii) all consents or approvals of any relevant governmental authorities (including OFTA) or other relevant third parties in Hong Kong or elsewhere which are required or appropriate for the entry into and the implementation of the ATNT Agreement having been obtained, including all filings with any relevant governmental authorities or other relevant third parties in Hong Kong or elsewhere which are required or appropriate for the entering into and the implementation of the ATNT Agreement having been made;

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

• (iv) the results of a due diligence exercise on the Sky Citi-Link Group being satisfactory to Teleinvest and written notice to that effect having been given to Happy Win;

• (v) achievement of the Milestone by the licensee of the FTNS Licence; and

• (vi) approval by shareholders of eCyber in a general meeting of the issue of the eCyber Consideration Shares as contemplated under the ATNT Agreement in accordance with the Listing Rules.

If the conditions have not been satisfied on or before 31st July, 2002 (or such later date as the parties may agree), eCyber and Teleinvest (acting jointly) or ATNT can terminate the ATNT Agreement and all rights and obligations of the parties will cease to have effect immediately upon such termination except that termination will not affect the then accrued rights and obligations of the parties.

Completion

The third business day after the satisfaction of the above conditions (or such later date as the parties may agree). It is agreed between the parties that they shall only be required to proceed to completion of the ATNT Agreement if WTF proceeds to complete the WTF Agreement.

3. WTF AGREEMENT

Date:	1st May, 2002
Parties:	(1) eCyber (as guarantor of Teleinvest);
	(2) Teleinvest (as vendor); and
	(3) WTF (as purchaser).
Terms:	Teleinvest agreed to sell and WTF agreed to purchase or
	procure the purchase of 80 Sky Citi-Link Shares, representing
	80% of the issued share capital of Sky Citi-Link, and the
	Teleinvest Loan.
Consideration:	HK$59,000,000 to be satisfied by the issue and allotment of
	107,272,727 Total WTF Consideration Shares (representing
	approximately 3.35% of the existing issued share capital of
	WTF as at the date hereof and 3.25% of the issued share
	capital of WTF, as enlarged by the issue of the Total WTF
	Consideration Shares but excluding any WTF Shares to be
	issued under the First Placing Agreement and the Second
	Placing Agreement (as announced by WTF on 3rd May,
	2002)).

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

eCyber WTF Consideration Shares

Out of the Total WTF Consideration Shares, 76,000,000 eCyber WTF Consideration Shares (representing approximately 2.37% of the existing issued share capital of WTF of 3,201,020,651 WTF Shares as at the Latest Practicable Date and 2.30% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares but excluding any WTF Shares to be issued under the First Placing Agreement and the Second Placing Agreement) will be issued to to eCyber or its nominee.

ATNT WTF Consideration Shares

Out of the Total WTF Consideration Shares, 31,272,727 ATNT WTF Consideration Shares (representing approximately 0.98% of the existing issued share capital of WTF of 3,201,020,651 WTF Shares as at the Latest Practicable Date and 0.95% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares but excluding any WTF Shares to be issued under the First Placing Agreement and the Second Placing Agreement) will be issued to ATNT or its nominee at the directions of eCyber;

Issue price per WTF Share

The Total WTF Consideration Shares will, upon issue, be credited as fully paid at HK$0.55 each (representing a premium of 8.91% over the average closing price of the WTF Shares of HK$0.505 from 7th March, 2002 to 20th March, 2002, being the 10 trading days prior to the suspension of trading in WTF Shares on 21st March, 2002 and a premium of 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002).

Basis

The consideration (including the determination of the issue price of HK$0.55 per WTF Consideration Share) was determined based on arms-length commercial negotiations between the parties with reference to the adjusted unaudited net assets of the Sky Citi-Link Group (excluding its consolidated current assets, consolidated current liabilities, and shareholders loan of approximately HK$78,395,000 granted to it) as at 31st March, 2002 of approximately HK$64,842,000. The consideration of HK$59,000,000 for the acquisition of an 80% interest in Sky Citi-Link represents a premium of approximately 13.7% over approximately HK$51,873,600, being 80% of such adjusted net asets of the Sky Citi-Link Group as determined above.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

Conditions

Completion of the WTF Agreement is conditional upon the satisfaction of the following conditions:

• (i) the Stock Exchange granting listing of and permission to deal in the Total WTF Consideration Shares;

• (ii) all consents or approvals of any relevant governmental authorities (including OFTA) or other relevant third parties in Hong Kong or elsewhere which are required or appropriate for the entry into and the implementation of the WTF Agreement having been obtained, including all filings with any relevant governmental authorities or other relevant third parties in Hong Kong or elsewhere which are required or appropriate for the entering into and the implementation of the WTF Agreement having been made;

• (iii) the ATNT Agreement becoming unconditional in accordance with its terms;

• (iv) the results of a due diligence exercise on the Sky Citi-Link Group being satisfactory to WTF and written notice to that effect having been given to Teleinvest;

• (v) achievement of the Milestone by the licensee of the FTNS Licence; and

• (vi) approval by shareholders of WTF in a general meeting of the issue of the Total WTF Consideration Shares contemplated under the WTF Agreement in accordance with the Listing Rules.

If the conditions have not been satisfied on or before 31st July, 2002 (or such later date as the parties may agree) eCyber and the vendor (acting jointly) or WTF may terminate the WTF Agreement and all rights and obligations of the parties will cease to have effect immediately upon such termination except that termination will not affect the then accrued rights and obligations of the parties.

Other terms

• (i) In the event the value of the current assets of the Sky Citi-Link Group as at completion of WTF Agreement is less than its current liabilities (both as certified by the Auditors), eCyber shall pay or procure the payment of the shortfall in cash to Sky Citi-Link within 10 business days from the date the Completion Accounts are issued.

• (ii) In the event the value of the current assets of the Sky Citi-Link Group as at completion of WTF Agreement exceeds its current liabilities (both as certified by the Auditors), WTF shall procure Sky Citi-Link pay the excess in cash to eCyber within 10 business days from the date the Completion Accounts are issued.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

Completion

Completion of the WTF Agreement shall take place immediately after completion of the ATNT Agreement (or such later date as the parties may agree). It is agreed between the parties that they are not obliged to proceed to completion of the WTF Agreement unless the ATNT Agreement has been completed in accordance with its terms.

4. RELATIONSHIP BETWEEN THE PARTIES

WTF and its subsidiaries do not hold any Shares or eCyber Shares as at the Latest Practicable Date. WTF is an independent third party not connected with the directors, chief executive or substantial shareholders of ATNT and eCyber or any of their subsidiaries or their respective associates.

ATNT holds 134,230,000 eCyber Shares, representing 5.20% of the issued share capital of eCyber, as at the Latest Practicable Date.

eCyber and its subsidiaries do not hold any ATNT or WTF Shares as at the Latest Practicable Date.

5. DESCRIPTION OF ATNT, ECYBER AND WTF

ATNT is an investment holding company. Its subsidiaries are principally engaged in the design, manufacture and sale of custom built electroplating machinery and other industrial machinery; performance stage production engineering and entertainment production services; money lending; investment holding in properties and the production and distribution of wind generators.

The principal activity of WTF is property investment and development, property leasing and the provision of building management and agency services.

The principal activity of eCyber is investment holding and its subsidiaries are engaged in information technology-related businesses and property investment in Hong Kong and the PRC.

6. DESCRIPTION OF SKY CITI-LINK

Sky Citi-Link was incorporated on 25th February, 2000 and is a leading teleport operator in Asia providing uplink or downlink services for transmission of various form of communication such as data, voice and TV. Its subsidiary, SCLIT is a traditional telecom carrier and one of the largest teleport operators in Asia. OFTA has granted the FTNS Licence to SCLIT on 18th January, 2000 to operate international telecommunication services with effect from 1st April, 2000. In addition, through SCLIT, Sky Citi-Link has acquired a 127,000 sq ft site at Tai Po Industrial Estate to develop an antenna farm and a teleport building which enable the customers of Sky Citi-Link to link up redundancy fibre loop and ATM backbone to local major fixed networks which cover most of the areas in Hong Kong.

Based on the audited consolidated accounts of Sky Citi-Link, a loss before and after taxation of HK$11,851,487 was incurred for the period from 1st April, 2000 to 31st March, 2001 and the net liability of Sky Citi-Link as at 31st March, 2001 was HK$12,832,728.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

Based on the Accounts, a loss before and after taxation of HK$8,110,430 was incurred for the period from 1st April, 2001 to 31st March, 2002 and the net liability of Sky Citi-Link as at 31st March, 2002 was HK$13,650,361.

Before Sky Citi-Link could contribute positively to the financial performance of ATNT, the Directors believed that further capital investment on equipment, machinery and other facilities have to be made.

7. BENEFITS OF THE TRANSACTION

ATNT

The Directors believed that the transactions contemplated under the ATNT Agreement and the WTF Agreement are and will be of commercial benefit to the Sky Citi-Link Group as a whole in view of the expertise of both eCyber and WTF in the satellite communication business and the Connected Transaction could create synergistic effect among all three listed companies by revitalizing the business and development of Sky Citi-Link. On such basis, the Directors believed that the premiums of the prices of the eCyber Consideration Share and the ATNT WTF Consideration Share over their respective market prices are justifiable.

By entering into the ATNT Agreement, ATNT is in fact obtaining an indirect interest in the business development of the Sky Citi-Link Group through its shareholding in eCyber and WTF. Furthermore, ATNT considered that the offer from eCyber represented a good opportunity for ATNT to divest itself of this particular business and in return receive securities in a more diversified listed company. In view of the activities presently caried out by eCyber and WTF and the potential future business development of the Sky Citi-Link Group, ATNT believed that it is in the interests of ATNT to invest in those two companies.

Upon completion of the ATNT Agreement, ATNT is free to sell or otherwise dispose of 10% of the eCyber Consideration Shares and ATNT WTF Consideration Shares (representing the eCyber Consideration Shares and the ATNT WTF Consideration Shares which are not subject to any lock-up restrictions as described in the section headed “Lockup” below). Any sum received from such sale or transfer will be placed by ATNT on deposit and applied for general working capital purposes. At present, ATNT intends to hold the eCyber Consideration Shares and ATNT WTF Consideration Shares, which it will receive under the ATNT Agreement, as a medium/long term investment. The Consideration Shares will be recorded at the closing prices of eCyber Shares and WTF Shares, where appropriate, as at the date of completion of the ATNT Agreement. Based on the closing price of eCyber Shares at HK$0.202 on 30th April, 2002 and the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, ATNT will incur a loss on disposal of approximately HK$10,636,109.00. Based on the closing price of eCyber Shares at HK$0.19 on the Latest Practicable Date and the closing price of the WTF Shares of HK$0.245 on the Latest Practicable Date, ATNT will incur a loss on disposal of approximately HK$18.30 million. However, the gain or loss on disposal of the 80 Sky Citi-Link Shares is to be adjusted by reference to the relevant closing price of the eCyber Shares and the WTF Shares

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LETTER FROM THE BOARD

on the date of completion of the ATNT Agreement and the WTF Agreement. Nevertheless, the Directors believed that the disposal of the 80% interest in Sky Citi-Link would bring an improvement to the cashflow position of ATNT given the anticipated capital requirement of Sky Citi-Link in the near future.

ATNT does not have any present intention to have any board representation on eCyber or WTF.

eCyber

For the financial year ended 30th June, 2000, eCyber recorded losses before taxation and after taxation of about HK$110.67 million and HK$110.54 million respectively. For the financial year ended 30th June, 2001, eCyber recorded losses before taxation and after taxation of about HK$81.36 million. The net assets of eCyber amounted to about HK$218.70 million and HK$358.64 million as at each of 30th June, 2000 and 30th June, 2001 respectively.

Upon completion of the transactions contemplated under the ATNT Agreement and the WTF Agreement, the shareholding in Sky Citi-Link held by Teleinvest will remain at 20% which is the same as prior to completion of the two agreements. As eCyber introduced the Sky Citi-Link investment to WTF, the consideration for the 80 Sky Citi-Link Shares to be paid by WTF to Teleinvest under the WTF Agreement is HK$4 million more than the consideration to be paid by Teleinvest to Happy Win for the 80 Sky Citi-Link Shares, representing the introduction charges by eCyber. Accordingly upon completion of the ATNT Agreement and the WTF Agreement, eCyber will enjoy a net gain of HK$4 million. eCyber will also enjoy future opportunities for strategic co-operation with ATNT and WTF, the two other listed companies in Hong Kong in the development of information technology business like Sky Citi-Link backed by cross-shareholding relationship as a long-term business commitment. The directors of eCyber considered that the transactions contemplated under the ATNT Agreement and the WTF Agreement are and will be of commercial benefit to the eCyber Group as a whole in view of the economies of horizontal integration achieved in the joint development of hi-tech related projects in the near future.

eCyber’s current intention is to hold the eCyber WTF Consideration Shares as a medium term investment.

WTF

As mentioned in the annual report of WTF for the year ended 31 March 2001, WTF is committed to repositioning itself to investing in businesses that could generate stable, sustainable and sufficient income in the long run and bring about a new outlook to the overall business development and financial structure of WTF and its subsidiaries.

For the financial year ended 31st March, 2000, WTF recorded profits before taxation and after taxation of about HK$28.56 million. For the financial year ended 31st March, 2001, WTF recorded losses before taxation and after taxation of about HK$323.47 million. The net assets of WTF amounted to about HK$99.16 million at 30th March, 2000 and its net liabilities amounted to about HK$240.70 million at 30th March, 2001.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

In October 2001, WTF acquired an approximately 1.99% interest in Hong Kong Satellite Technology Holdings Limited, a company the subsidiaries of which are principally engaged in the development of a satellite communications platform and the manufacture, assembly, marketing and sale of new commercial communications satellites. WTF announced on 3rd May, 2002 that it has entered into a conditional agreement with Hong Kong Satellite Technology Holdings Limited to acquire a further 1.95% interest in its share capital which would bring WTF’s interest to about 3.9% of its issued share capital. It was also announced on 3rd May, 2002 that WTF had entered into the First Placing Agreement and the Second Placing Agreement under which an aggregate of 487,500,000 new WTF Shares will be placed to Benevolent Developments, Well Growth and/or independent investors procured by them respectively. Part of the net proceeds from such placing will be used to finance WTF’s acquisition of a further interest in Hong Kong Satellite Technology Holdings Limited as described above.

To this end, the directors of WTF consider that WTF’s acquisition of an 80% interest in Sky Citi-Link under the WTF Agreement, coupled with the interest acquired and to be acquired by it in Hong Kong Satellite Technology Holdings Limited, are consistent with its intention to diversify its investment into the technology field which they anticipate would offer vast market potential. WTF presently intends to hold the interest to be acquired by it in Sky Citi-Link as a long term investment. The directors of WTF believe that it is the interests of WTF to enter into the WTF Agreement.

Having considered the potential of WTF’s investment in the acquisition of Sky Citi-Link, its intention to diversify its investment into the technology field and the potential to create a strategic partnership with eCyber as a shareholder of Sky Citi-Link , the directors of WTF believe that it is the interests of WTF to enter into the WTF Agreement and that the terms of the WTF Agreement are fair and reasonable (including the consideration for the 80 Sky Citi-Link Shares to be paid by WTF to Teleinvest which is HK$4,000,000 more than the consideration to be paid by Teleinvest to Happy Win for the 80 Sky Citi-Link Shares under the ATNT Agreement.)

6. LOCKUP

Under the ATNT Agreement, ATNT agreed to undertake on completion of the ATNT Agreement and WTF Agreement:

• (i) to eCyber that it will not and will procure that the registered holders, nominees or trustees holding the eCyber Consideration Shares will not sell, transfer or otherwise dispose of any direct or indirect interest in:

• (a) 136,080,000 eCyber Consideration Shares, representing 90% of the total number of eCyber Consideration Shares from completion of the ATNT Agreement to a date falling three months from completion of the ATNT Agreement; and

• (b) 75,600,000 eCyber Consideration Shares, representing 50% of the total number of eCyber Consideration Shares from the next day after a day falling three months from completion of the ATNT Agreement to a day falling 6 months from completion of the ATNT Agreement;

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• (ii) to WTF that it will not and will procure that the registered holders, nominees or trustees holding the ATNT WTF Consideration Shares will not sell, transfer or otherwise dispose of any direct or indirect interest in:

• (a) 28,145,454 ATNT WTF Consideration Shares, representing 90% of the ATNT WTF Consideration Shares, from completion of the WTF Agreement to a date falling three months from completion of the WTF Agreement; and

• (b) 15,636,363 ATNT WTF Consideration Shares, representing 50% of the total number of ATNT WTF Consideration Shares, from the next day after a day falling three months from completion of the ATNT Agreement to a day falling 6 months from completion of the ATNT Agreement.

ATNT agreed with WTF and eCyber to deposit the share certificates for the 75,600,000 eCyber Consideration Shares representing 50% of the total number of eCyber Consideration Shares, and 15,636,364 ATNT WTF Consideration Shares representing 50% of the total number of ATNT WTF Consideration Shares on completion of the ATNT Agreement with an escrow agent during a period of six months from completion of the ATNT Agreement.

7. CHANGES IN SHAREHOLDING STRUCTURE

eCyber

The shareholding structure of eCyber immediately before and after completion of the ATNT Agreement (assuming that there are no other changes to the shareholding structure of eCyber) are as follows:

			Immediately after	Immediately after
Name of shareholders	Before completion		completion of
of eCyber	of the ATNT Agreement		the ATNT Agreement
	No. of		No. of
	eCyber Shares	%	eCyber Shares	%
East Marton Group Limited	275,928,500	10.68	275,928,500	10.09
Mr. Li Lian Min	261,540,000	10.12	261,540,000	9.56
ATNT	134,230,000	5.20	285,430,000	10.44*
Public	1,911,801,500	74.00	1,911,801,500	69.91
Total	2,583,500,000	100.00	2,734,700,000	100.00

• ATNT does not have any present intention to become a substantial shareholder of eCyber and may dispose of some eCyber Shares in this regard.

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE BOARD

WTF

The following table illustrates the changes in the shareholding structures of WTF before and after the placing of the 292,500,000 WTF Shares under the First Placing Agreement, the placing of 195,000,000 WTF Shares under the Second Placing Agreement and issue and allotment of 107,272,727 Total WTF Consideration Shares under the WTF Agreement.

			Immediately		Immediately
			after placing		after placing
			of 292,500,000		of 292,500,000
			WTF Shares		WTF Shares,
			and 195,000,000		195,000,000
			WTF Shares but		WTF Shares
			before issue and		and issue and
			allotment of	Approximate	allotment of	Approximate
		Approximate	107,272,727	percentage of	107,272,727	percentage of
	As at the	percentage of	Total WTF	Company’s	Total WTF	Company’s
	date of this	WTF’s issued	Consideration	issued share	Consideration	issued share
	announcement	share capital	Shares	capital	Shares	capital
Mr Chu, his associates
and parties acting in
concert with him	1,071,500,000	33.47%	1,071,500,000	29.05%	1,071,500,000	28.23%
Public	2,129,520,651	66.53%	2,617,020,651	70.95%	2,724,293,378*	71.77%
Total	3,201,020,651	100.00%	3,688,520,651	100.00%	3,795,793,378	100.00%

* Immediately after completion of the WTF Agreement, eCyber will hold 76,000,000 WTF Shares, representing approximately 2.00% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares and the placing of 292,500,000 WTF Shares and 195,000,000 WTF Shares and ATNT will hold 31,272,727 WTF Shares, representing approximately 0.82% of the issued share capital of WTF, as enlarged by the issue of the Total WTF Consideration Shares and the placing of 292,500,000 WTF Shares and 195,000,000 WTF Shares.

8. RECOMMENDATION

The text of a letter to the Shareholders from the Independent Director containing its recommendation in relation to the Connected Transaction is set out in this circular. The Independent Director, after taking into account the advice of Barits, in particular, the principal factors and reasons set out in the letter of advice from Barits, is of the opinion that the Connected Transaction is in the interests of ATNT and its Shareholders as a whole, and the terms of the Connected Transaction and all agreements entered into by the Group in connection therewith as described above are fair and reasonable so far as the Shareholders as a whole are concerned. Accordingly, the Independent Director recommends that the Shareholders vote in favour of the ordinary resolution(s) approving the Connected Transaction to be proposed at the Special General Meeting. No Shareholder has to abstain from voting in the Special General Meeting.

The Directors believe that the Connected Transaction is in the best interests of ATNT and the Shareholders as a whole. Accordingly, the Directors recommend that at the Special General Meeting, the Shareholders should vote in favour of the resolution(s) relating to the Connected Transaction in terms as set out in this circular.

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9. SPECIAL GENERAL MEETING

Set out in this circular is a notice convening the Special General Meeting to be held at 2:00 p.m. on 5th July, 2002 at 11 Dai Hei Street, Tai Po Industrial Estate, New Territories at which ordinary resolutions will be proposed to approve the Connected Transaction and all agreements entered into in connection with the Connected Transaction.

A form of proxy is enclosed. Whether or not you are able to attend the Special General Meeting in person, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon to ATNT’s share registrar, Secretaries Limited at 5th Floor, Wing On Centre, 111 Connaught Road Central, Hong Kong as soon as possible but in any event not later than 48 hours before the time appointed for the holding of the Special General Meeting. Completion of the form of proxy will not preclude you from attending and voting at the Special General Meeting should you so wish.

By Order of the Board Asia Tele-Net and Technology Corporation Limited Lam Kwok Yan Chairman

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Asia Tele-Net and Technology Corporation Limited

LETTER FROM THE INDEPENDENT DIRECTOR

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(Incorporated in Bermuda with limited liability)

17th June, 2002

To the Shareholders

Dear Sir or Madam,

CONNECTED TRANSACTION DISPOSAL OF AN 80% INTEREST IN A TELECOM CARRIER

I refer to the circular (the “Circular”) dated 17th June, 2002 issued by ATNT, of which this letter forms part. The terms used in the Circular shall have the same meanings in this letter unless the context otherwise requires.

As the independent non-executive Director who has no involvement in the relevant matter, I have been appointed by the Directors to advise you as to whether, in my opinion, the terms of Connected Transaction are fair and reasonable so far as the Shareholders as a whole are concerned.

I wish to draw your attention to the letter from the Board, as set out in the Circular, and the letter of advice from Barits, as set out in the Circular, both of which provide details of the ATNT Agreement. Having considered the opinion given by Barits and the principal factors and reasons taken into consideration by it in arriving at its opinion, I am of the opinion that the Connected Transaction is fair and reasonable as far as the Shareholders as a whole are concerned. Accordingly, I recommend the Shareholders to vote in favour of the ordinary resolution(s) which will be proposed at the Special General Meeting to approve the ATNT Agreement and the transaction(s) contemplated therein.

Yours faithfully, Mr. Kin Wai Cheung

Independent non-executive Director

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Asia Tele-Net and Technology Corporation Limited

LETTER OF ADVICE FROM BARITS

The following is the text of a letter of advice from Barits Securities (Hong Kong) Limited to the Independent Director in respect of the Connected Transaction, and is prepared for inclusion in this circular.

Barits Securities (Hong Kong) Limited

Rooms 3403-3407, 34/F Edinburgh Tower, The Landmark 15 Queen’s Road Central Hong Kong

17th June, 2002

To the Independent Director of

Asia Tele-Net and Technology Corporation Limited

Dear Sir,

CONNECTED TRANSACTION DISPOSAL OF AN 80% INTEREST IN A TELECOM CARRIER

INTRODUCTION

We refer to our appointment as the independent financial adviser to advise the Independent Director in respect of the Connected Transaction, details of which are set out in this circular, of which this letter forms a part. Unless the context otherwise requires, terms used in this letter have the same meanings as those defined in this circular. We recommend the Independent Director to advise the Shareholders to read this circular carefully before they decide to vote for or against the Connected Transaction.

On 1st May, 2002, the ATNT Agreement was entered into between ATNT, Happy Win, eCyber and Teleinvest. Happy Win, a wholly-owned subsidiary of ATNT, agreed to sell 80 Sky Citi-Link Shares (representing a 80% interest in Sky Citi-Link) and the Happy Win Loan to Teleinvest, a wholly-owned subsidiary of eCyber, for a consideration of HK$55 million. In view that Sky Citi-Link was held as to 80% and 20% by Happy Win and Teleinvest respectively, the disposal of an 80% interest in Sky Citi-Link by Happy Win to Teleinvest constitutes a connection transaction for ATNT under Chapter 14 of the Listing Rules and is subject to approval by the Shareholders in the Special General Meeting.

Mr. David Chi Kin Ng, an independent non-executive Director, is also an independent non-executive director of Karl Thomson Holdings Limited, a company whose shares are listed on the Stock Exchange and the holding company of Karl Thomson Financial Advisory Limited which is the financial advisers to ATNT in relation to the Connected Transaction. In view of that, Mr. Ng is not considered to be independent so far as the Connected Transaction is concerned and therefore he has

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not participated in formulating a recommendation to the Shareholders so as to avoid any conflict of interest that may arise. Accordingly, only Mr. Kin Wai Cheung, the sole remaining independent non-executive Director, has been appointed to advise the Shareholders in relation to the Connected Transaction.

In formulating our opinion and advice, we have relied upon accuracy of the information and representations contained in this circular and information provided to us by ATNT and its Director(s). We have assumed that all statements and representations made or referred to in this circular were true at the time they were made and continue to be true at the date of the Special General Meeting. We have also assumed that all statements of belief, opinion and intention made by the Director(s) in this circular were reasonably made after due enquiry. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by ATNT and its Director(s) and have no reason to doubt that any relevant material facts have been withheld or omitted.

We consider that we have reviewed sufficient information to reach an informed view and to justify reliance on the accuracy of the information contained in this circular and to provide a reasonable basis for our recommendation. We have not, however, conducted an independent investigation into the business affairs, financial position or future prospects of the Group, Sky Citi-Link, eCyber or WTF nor have we carried out any independent verification of the information supplied.

CONNECTED TRANSACTION

In giving our advice to the Independent Director, we have taken into account the following principal factors and reasons in considering whether or not the terms of the Connected Transaction are fair and reasonable.

Background

Before completion of the ATNT Agreement, Sky Citi-Link was held as to 80% by Happy Win, a wholly-owned subsidiary of ATNT, and as to 20% by Teleinvest, a wholly-owned subsidiary of eCyber. Pursuant to the ATNT Agreement, Happy Win agreed to sell and Teleinvest agreed to purchase or procure the purchase of 80 Sky Citi-Link Shares, representing 80% of the issued share capital of Sky Citi-Link, and the Happy Win Loan for a consideration of HK$55 million. The consideration was to be satisfied by the issue and allotment of 151,200,000 eCyber Consideration Shares, credited as fully paid at HK$0.25 each, and eCyber procuring the issue and allotment of 31,272,727 ATNT WTF Consideration Shares by WTF, credited as fully paid at HK$0.55 each, to ATNT.

Pursuant to another agreement, the WTF Agreement, Teleinvest agreed to sell and WTF agreed to purchase or procure the purchase of 80 Sky Citi-Link Shares, representing 80% of the issued share capital of Sky Citi-Link, and the Teleinvest Loan for a consideration of HK$59 million. The consideration was to be satisfied by the issue and allotment of 76,000,000 eCyber WTF Consideration Shares, credited as fully paid at HK$0.55 each to eCyber, and 31,272,727 ATNT WTF Consideration Shares, credited as fully paid at HK$0.55 each, to ATNT.

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In essence, eCyber took the role of introducing agent in the above two transactions in return for an agent fee of HK$4 million, which represented the difference between the considerations under each of the ATNT Agreement and the WTF Agreement. It is agreed between the parties to the ATNT Agreement that they shall only be required to proceed to completion of the ATNT Agreement if WTF proceeds to complete the WTF Agreement. Details of the terms and conditions of the ATNT Agreement and the WTF Agreement are set out in the letter from the Board.

Rationale of the Connected Transaction

Contribution of Sky Citi-Link to ATNT

ATNT is an investment holding company. Its subsidiaries are principally engaged in the design, manufacture and sale of custom built electroplating machinery and other industrial machinery, timber business in Indonesia, satellite communication business, performance stage production engineering and entertainment production services, money lending, investment holding in properties and the production and distribution of wind generators.

For each of the financial years ended 31st March, 2000 and 2001, ATNT recorded turnovers of approximately HK$581.19 million and HK$720.40 million. However, over the same two periods, ATNT recorded profit attributable to Shareholders of approximately HK$25.06 million and loss attributable to Shareholders of approximately HK$199.79 million respectively. According to the 2001 annual report of ATNT, the loss making situation was a combination of the decline in gross profit margin as well as additional distribution cost, administrative cost and finance cost due to the development of data center business and satellite business, losses incurred on securities investments and other investments. Besides, the loss on disposal of the data center and the written off of an investment in an internet company also contributed to the loss making situation. Lastly, there were substantial changes in market conditions during financial year 2001 which led to an adverse impact on internet, technology, telecommunications and electronics industries.

The Directors believe that Sky Citi-Link is a leading teleport operator in Asia providing uplink or downlink services for transmission of various form of communication such as data, voice and TV. Based on the audited consolidated profit and loss account of Sky Citi-Link for the year ended 31st March 2001, a loss after taxation of approximately HK$11.85 million was recorded. Based on the unaudited consolidated profit and loss account of Sky Citi-Link for the year ended 31st March 2002, a loss after taxation of approximately HK$8.11 million was recorded. On 18th January, 2000, OFTA granted the FTNS License to SCLIT, a wholly-owned subsidiary of Sky Citi-Link, to operate international telecommunication services. In addition, through SCLIT, Sky Citi-Link has acquired a site at Tai Po Industrial Estate to develop an antenna farm and a teleport building which enable customers of Sky Citi-Link to link up redundancy fibre loop and ATM backbone to local major fixed networks which cover most of the areas in Hong Kong. The Directors anticipate that before Sky Citi-Link could contribute positively to the financial performance of ATNT, further capital investment on equipment, machinery and other facilities have to be made.

As stated in the 2001 annual report of ATNT, the Directors advised that their investment strategies were to explore and develop businesses which offer business opportunities and immense growth potential. Up to 30th September, 2001, ATNT has maintained a business portfolio which comprised timber business, satellite communication business, performance stage production

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engineering and entertainment production services, electroplating equipment business, wet processing equipment business and wind generator business. At the same time, ATNT has consistently reviewed its business portfolio and evaluate the return of each business from time to time with an attempt to repositioning itself promptly in response to changing market conditions. As a demonstration of such strategy, in 2001, ATNT disposed of its data center business as high operating costs were incurred in maintaining and operating such business in light of the ever more intense competition. Accordingly, it is in line with the business strategy of ATNT in disposing of its interest in Sky Citi-Link pursuant to the ATNT Agreement in order to reduce the potential impact of Sky Citi-Link on the financial performance of ATNT as well as the requirement of further capital investment before Sky Citi-Link may possibly contribute to the profitability of ATNT.

Benefits of the Connected Transaction to ATNT

WTF is principally engaged in property investment and development, property leasing and the provisions of building management and agency services. As stated in the annual report for the year 2000, WTF is committed to repositioning itself not only as a property developer but also as a strategic investor in high-tech related business. In October 2001, it entered into an agreement to acquire an approximately 1.99% interest in Hong Kong Satellite Technology Holdings Limited, which subsidiaries’ principal businesses were developing satellite communications platform, network, broadband internet access, direct television and mobile communication, and manufacturing and selling of new commercial communications satellites. In May 2002, WTF acquired a further 1.95% interest in Hong Kong Satellite Technology Holdings Limited which would increase WTF’s interest to about 3.9%. As stated in the announcement dated 21st July, 2001, WTF intends to hold the satellite communication business as a long term investment.

The principal activity of eCyber is investment holding and its subsidiaries are engaged in information technology-related business and property investment in Hong Kong and the PRC. As stated in its 2002 interim report, eCyber was continuing its transformation from a property-oriented business to a high technology oriented business. In line with such direction, eCyber has made several investments in high technology during 2001 and Sky Citi-Link represented one of such investment.

In view of the expertise of both eCyber and WTF in the satellite communication business, the Directors believed that the transactions contemplated under the ATNT Agreement and the WTF Agreement are and will be of commercial benefit to the Sky Citi-Link Group as a whole. By entering into the ATNT Agreement, ATNT is in fact obtaining an indirect interest in the business development of the Sky Citi-Link Group through its shareholding in eCyber and WTF. Furthermore, ATNT considered that the offer from eCyber represented a good opportunity for ATNT to divest itself of this particular business and in return receive securities in a more diversified listed company. Before entering into the ATNT Agreement, ATNT directly holds the shares of a private company, Sky Citi-Link, of low liquidity. Pursuant to the ATNT Agreement, Happy Win will receive eCyber Consideration Shares and ATNT WTF Consideration Shares which are liquid shares of two listed companies tradable on the stock market. In view of the activities presently carried out by eCyber and WTF, the potential future business development of the Sky Citi-Link Group under the management of eCyber and WTF as well as the impact on the accounts of ATNT as a result of the financial performance of eCyber and WTF under the proposed accounting treatment of the Consideration Shares (as detailed in the section headed “Financial effects” below), we concur with ATNT’s view that it is in the interests of ATNT to invest in those two companies.

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LETTER OF ADVICE FROM BARITS

Valuation and consideration

The consideration of HK$55 million for the disposal of the 80% interest in Sky Citi-Link was determined based on arms-length commercial negotiations between the parties with reference to the unaudited adjusted net assets of Sky Citi-Link Group (excluding its consolidated current assets, consolidated current liabilities, and shareholders’ loan of approximately HK$78,395,000 granted to it) as at 31 March, 2002 of approximately HK$64,842,000. Such consideration represents a premium of approximately 6% over approximately HK$51,873,600, being 80% of the adjusted net assets of the Sky Citi-Link Group as determined above. The consideration is to be satisfied by the issue and allotment of 151,200,000 eCyber Consideration Shares, credited as fully paid at HK$0.25 each (representing a premium of about 23.76% over the closing price of the eCyber Shares of HK$0.202 on 30th April, 2002, being the last trading day prior to the suspension of trading in eCyber Shares on 2nd May, 2002) and eCyber procuring the issue and allotment of 31,272,727 ATNT WTF Consideration Shares by WTF, credited as fully paid at HK$0.55 each (representing a premium of about 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, being the last trading day prior to the suspension of trading in WTF Shares on 21st March, 2002) to ATNT on completion of the ATNT Agreement.

Based on the audited consolidated accounts for the year ended 31st March, 2001 and the Accounts for the year ended 31st March, 2002, Sky Citi-Link recorded losses after taxation of approximately HK$11.85 million and HK$8.11 million respectively. Accordingly, a price to earnings ratio is not available for assessing the valuation of Sky Citi-Link. As such, we are of the view that the net asset value of Sky Citi-Link as at 31st March, 2002 is one of the bases available for determining a reasonable level of consideration. On such basis, we consider the consideration of HK$55,000,000 to be acceptable in light of the 6% premium of such consideration over 80% of the adjusted net assets of Sky Citi-Link Group.

Pursuant to the ATNT Agreement, the eCyber Consideration Share is priced at HK$0.25 each, which represents:

• (i) a premium of about 23.76% over the closing price of the eCyber Shares of HK$0.202 on 30th April, 2002, being the last trading day prior to the suspension of trading in eCyber Shares on 2nd May, 2002;

• (ii) a premium of about 23.76% over the average closing price of about HK$0.202 per eCyber Share quoted on the Stock Exchange for the last 10 trading days up to and including 30th April, 2002; and

• (iii) a premium of about 31.58% over the closing price of the eCyber Shares of HK$0.19 as at the Latest Practicable Date.

Besides, the ATNT WTF Consideration Share is priced at HK$0.55 each, which represents:

• (i) a premium of about 29.41% over the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, being the last trading day prior to the suspension of trading in WTF Shares on 21st March, 2002;

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LETTER OF ADVICE FROM BARITS

• (ii) a premium of about 8.91% over the average closing price of about HK$0.505 per WTF Share quoted on the Stock Exchange for the last 10 trading days up to and including 20th March, 2002; and

• (iii) a premium of about 124.49% over the closing price of the WTF Shares of HK$0.245 as at the Latest Practicable Date.

Upon completion of the ATNT Agreement, ATNT will exchange relatively illiquid shares in a private company for liquid and tradable shares in two listed companies. It is not abnormal for such exchange to demand a liquidity premium. Besides, as advised by the Directors, they are confident that given the resources and expertise of WTF and eCyber in the field of satellite communication business, the Connected Transaction could create synergistic effect among all three listed companies by revitalizing the business and development of Sky Citi-Link. On such basis, we concur with the Directors’ view that the premiums of the prices of the eCyber Consideration Share and the ATNT WTF Consideration Share over their respective market prices are justifiable.

However, Shareholders should note that under the ATNT Agreement, 90% of the eCyber Consideration Shares and the ATNT WTF Consideration Shares are subject to lock-up for three months from the respective dates of completion of the ATNT Agreement and the WTF Agreement and 50% of the same are subject to further lock-up for the three months thereafter. As stated in the letter from the Board, ATNT presently intends to hold the Consideration Shares as medium/long term investments. Taking into account such intention and the fact that all eCyber Consideration Shares will be released from lock-up six months from the respective dates of completion of the ATNT Agreement and the WTF Agreement, we do not consider the lock-up arrangement prejudicial to the interests of ATNT.

Financial effects

Earnings

Upon completion of the ATNT Agreement, ATNT is free to sell or otherwise dispose of 10% of the eCyber Consideration Shares and 10% of the ATNT WTF Consideration Shares (representing the eCyber Consideration Shares and the ATNT WTF Consideration Shares which are not subject to any lock-up restrictions as described in the section headed “Lockup” in the letter from the Board). It is the current intention of the Directors that any sum received from such sale or transfer will be placed by ATNT on deposit and applied for general working capital purposes. At present, ATNT intends to hold the Consideration Shares, which it will receive under the ATNT Agreement, as a medium/long term investment.

After discussion with ATNT’s auditors about the accounting treatment of the Consideration Shares in its financial statements, the Directors advised that the Consideration Shares will be recorded at the closing prices of eCyber Shares and WTF Shares, where appropriate, as at the date of completion of the ATNT Agreement. Accordingly, whether the disposal of the 80% interest in Sky Citi-Link will result in a loss or a gain is subject to the then market prices of eCyber Shares and WTF Shares. On the basis of the closing price of eCyber Shares at HK$0.202 on 30th April, 2002 and the closing price of the WTF Shares of HK$0.425 on 20th March, 2002, ATNT will incur a loss on disposal of approximately HK$10.6 million. On the basis of the closing price of eCyber Shares at HK$0.19 on the Latest Practicable Date and the closing price of the WTF Shares of HK$0.245 on the Latest Practicable Date, ATNT will incur a loss on disposal of approximately HK$18.3 million.

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LETTER OF ADVICE FROM BARITS

Upon completion, the accounts of Sky Citi-Link Group will no longer be consolidated in the Group’s accounts. In the long run, given the loss making track record of Sky Citi-Link Group and the fact that further capital investments are expected to be required before Sky Citi-Link Group could contribute positive returns, the Connected Transaction represented a good opportunity for ATNT to divest from such business, thereby avoiding any possible impact on earnings of ATNT in the near future. Notwithstanding that eCyber and WTF recorded losses for their latest audited financial years respectively, their future financial performance will have no direct and immediate impact on the earnings of ATNT following completion of the ATNT Agreement so long as the Consideration Shares are recorded in the accounts of ATNT under the category of investment. When the Consideration Shares, in part or in full, are disposed of by the Group, the impact of such disposal on the profit and loss account of the Group will be subject to the then market prices of the Consideration Shares at the time of disposal.

Based on the latest respective closing share prices of eCyber and WTF, it is likely that ATNT will incur a loss on disposal upon completion of the ATNT Agreement. However, given that the one-off loss on disposal, if any, could shield ATNT from the further capital requirements of Sky Citi-Link as stated above and in view of the reasons set out in the section headed “Rationale of the Connected Transaction” above, we consider the Connected Transaction to be beneficial to the financial performance of the Group in a longer term basis.

Net asset value

Similar to the situation described under sub-section “Earnings” above, the immediate effect of the Connected Transaction on the net asset value of ATNT is subject to the closing prices of eCyber Shares and WTF Shares as at the date of completion of the ATNT Agreement. The Connected Transaction would effect an increase or decrease on the net asset value of ATNT by an amount equivalent to the gain or loss on disposal of the 80% interests in Sky-Citi Link. With reference to the reasons stated in the sub-section “Earnings” above, we consider the one-off impact of the Connected Transaction, if any, on the net asset value of the Group to be in line with the interests of the Group in a longer term basis.

Working capital

As mentioned in the section headed “Rationale of the Connected Transaction” above, one of the principal strategies of ATNT was to diversify its businesses so as to reduce overall business risk and to achieve steady revenue sources. However, given the loss making track record of Sky Citi-Link and the anticipated capital requirement in the future, we concur with the Directors’ view that disposal of the 80% interest in Sky Citi-Link would bring an improvement to the cashflow position of ATNT in the near future.

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LETTER OF ADVICE FROM BARITS

Recommendation

Having considered the abovementioned principal factors and reasons, in particular,

• the exchange of illiquid shares of a private company for liquid shares of two listed companies;

• the possible synergistic effect to the future business development of Sky Citi-Link Group as a result of the resources and expertise of eCyber and WTF in the field of satellite communication;

• the alleviation from the potential impact of Sky Citi-Link on the financial performance of the Group in view of the loss making track record and further capital requirements of Sky Citi-Link; and

• an opportunity for the Group to realize immediate returns,

we conclude that the terms of the ATNT Agreement are fair and reasonable so far as the Shareholders as a whole are concerned and are in the interests of ATNT and its Shareholders. Accordingly, we recommend the Independent Director to advise the Shareholders to vote in favour of those resolution(s) in relation to the Connected Transaction to be proposed at the Special General Meeting.

Yours faithfully, For and on behalf of Barits Securities (Hong Kong) Limited Terence Hong Alfred Wong Executive Director Director

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Asia Tele-Net and Technology Corporation Limited

GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to ATNT. The Directors collectively and individually accept full responsibility for the accuracy of the information relating to ATNT contained in this circular (other than that relating to eCyber and WTF) and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other matters the omission of which would make any statement in this circular relating to ATNT misleading.

In this circular, all information on eCyber is derived from the annual reports and public information of eCyber, in particular, the joint announcement of eCyber, WTF and ATNT dated 6th May, 2002. The Directors jointly and severally accept full responsibility for the accurate extraction of information contained in such annual reports and public information of eCyber.

In this circular, all information on WTF is derived from the annual reports and public information of WTF, in particular, the joint announcement of eCyber, WTF and ATNT dated 6th May, 2002. The Directors jointly and severally accept full responsibility for the accurate extraction of the information contained in such annual reports and public information of WTF.

2. DISCLOSURE OF INTERESTS

(a) Interests of Directors

As at the Latest Practicable Date, the interests of the Directors in the share capital of ATNT and its associated corporations (within the meaning of the SDI Ordinance) which were required to be notified to ATNT and the Stock Exchange pursuant to section 28 of the SDI Ordinance (including the interests which they were deemed or taken to have under section 31 of or Part I of the Schedule to the SDI Ordinance) or which were required, pursuant to section 29 of the SDI Ordinance, to be entered in the register referred to therein or which were required to be notified to ATNT and the Stock Exchange pursuant to the Model Code for Securities Transactions by Director of Listed Companies contained in the Listing Rules, were as follow:

(i) ATNT

		Number of Shares held	Number of Shares held	Number of Shares	Number of Shares
		Personal	Corporate	**under **	share
**Name **	of Director	interests	interests	option scheme
Kwok	Yan Lam	69,503,340	1,940,826,660 Note(1)	43,000,000	Note(2)
				114,500,000	Note(3)
Kwok	Hing Lam	69,493,340	1,940,826,660 Note(1)	43,000,000	Note(2)
				114,500,000	Note(3)

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Asia Tele-Net and Technology Corporation Limited

GENERAL INFORMATION

APPENDIX

Note:

1. As at the Latest Practicable Date, an aggregate of 1,940,826,660 Shares were held by Optimist International Limited (“Optimist”). Messers. Kwok Yan Lam and Kwok Hing Lam (“Messers. Lam”) are each entitled to exercise 50% of the voting rights at general meetings of Medusa Group Limited, which in turn is entitled to exercise 100% of the voting rights at general meetings of Optimist.

2. The options were granted on 14th November, 2000 under ATNT’s executive share option scheme adopted on 6th September, 2000. The Options are exercisable at HK$0.056 per Share from 17th November, 2000 to 16th November, 2003.

3. The Options were granted on 30th August, 2001 under ATNT’s new executive scheme option adopted on 1st January, 2001, the options are exercisable at HK$0.053 per Share from 7th September, 2001 to 6th September, 2004.

4. (ii) Asia Nice Art Production Limited*

Number of ordinary Shares Name of Director (Personal Interest) Kwok Yan Lam 1,000

• Asia Nice Art Production Limited is a subsidiary owned as to 60% by ATNT.

Saved as disclosed herein, as at the Latest Practicable Date, none of the Directors had any interest in the share capital of ATNT or any of its associated corporations which were required to be notified to ATNT and the Stock Exchange pursuant to section 28 of the SDI Ordinance (including the interests which they were deemed or taken to have under section 31 of or Part I of the Schedule to the SDI Ordinance) or pursuant to the Model Code for Securities Transactions by Directors of Listed Companies or which were required, pursuant to section 29 of the SDI Ordinance, to be entered in the register referred to therein.

• (b) Save as disclosed herein, there is no contract or arrangement subsisting at the date of this Circular in which any of the Directors is materially interested and which is significant in relation to the business of the Group.

• (c) None of the Directors has had any direct or indirect interest in any assets which have since 31st March, 2001 (being the date to which the latest published audited financial statements of the Company were made up) been acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Group.

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GENERAL INFORMATION

APPENDIX

3. SUBSTANTIAL SHAREHOLDERS

Save as disclosed herein, the Directors and the chief executive of ATNT were not aware of any person, who was, directly or indirectly, interested in 10 per cent. or more of the nominal value of the issued share capital of ATNT or any of its subsidiaries as at the Latest Practicable Date apart from the following:

		Percentage of
		shares or equity
Name of subsidiary	Name of holder	interest
Asia Nice Art Production	Mr. Kwok Yan Lam	10%
Limited	Mr. Man Hoi Lui	30%
Beijing Golden PAL Plating	Beijing C & W Technology	24%
Equipment Company	Company Limited
Limited	Institute No. 14 of Academy	24%
	No. 1 in China Aerospace
	Science and Technology
	Corporation
Beijing Haoyuan Power	Institute No. 14 of Academy	48%
Equipment Company	No. 1 in China Aerospace
Limited	Science and Technology
	Corporation
Goodyear Asia Limited	Mr. Sze Cheng Hsu	40%
Kamtress Limited	Mr. Wai Man Tsang	20%
Pal Sales Inc.	IPS Inc.	49%
Pal (Sea) Sdn. Bhd.	Mr. E.B. Ho	40%
Pal Service Sdn. Bhd.	Mr. Chun Bun Chau	40%
	(note: Pal(Sea) Sdn. Bhd., a subsidiary
	of ATNT, holds 60%)

4. QUALIFICATION

The following is the qualification of the expert who has given opinion or advice which is contained in this circular:

Name Qualification Barits an investment adviser and dealer registered under the Securities Ordinance, Chapter 333 of the Laws of Hong Kong

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GENERAL INFORMATION

APPENDIX

5. LITIGATION

None of the members of ATNT is engaged in any litigation or arbitration of material important and no litigation or claim of material important is known to the Directors or ATNT to be pending or threatened by or against any member of the Group.

6. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors has entered into, with any member of ATNT, a service agreement which is not terminable within one year without payment of compensation (other than statutory compensation).

7. CONSENT

Barits has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and reference to its name and letter in the form and context in which they appear.

8. MATERIAL CHANGES

The Directors are not aware of any material adverse change in the financial or trading position of ATNT since 31st March 2001, the date to which the latest published audited financial statements of ATNT were made up.

9. MISCELLANEOUS

• (a) The English text of this circular shall prevail over the Chinese text.

• (b) The Secretary of ATNT is Mr. Patrick Sung King Leung who is a fellow member of the Hong Kong Society of Accountants and CPA Australia.

• (c) The registered office of ATNT is at Clarendon House, Church Street, Hamilton HM11, Bermuda. The principal registrars and transfer office of ATNT is Butterfield Corporate Sevice Limited at Rosebank Centre, 14 Bermudiana Road, Pembroke, Bermuda. The Hong Kong branch registrars and transfer office is Secretaries Limited at 5th Floor, Wing On Centre, 111 Connaught Road Central, Hong Kong.

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GENERAL INFORMATION

APPENDIX

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the offices of ATNT at 11 Dai Hei Street, Tai Po Industrial Estate, New Territories during normal business hours on any day (except public holidays) for a period of 14 days from date of this Circular:

• (a) the ATNT Agreement;

• (b) the WTF Agreement;

• (c) the letter of advice from Barits, the text of which is set out in this circular; and

• (d) the written consent refered to in the section headed “Consent” above.

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Asia Tele-Net and Technology Corporation Limited

NOTICE OF SPECIAL GENERAL MEETING

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(Incorporated in Bermuda with limited liability)

NOTICE IS HEREBY GIVEN that a special general meeting (the “Special General Meeting”) of the shareholders of Asia Tele-Net Technology Corporation Limited (the “ATNT”) will be held at 2:00 p.m. on 5th July, 2002 at 11 Dai Hei Street, Tai Po Industrial Estate, New Territories for the following purposes:

1. To consider as special business, and if thought fit, passing with or without amendments, the following resolutions as ordinary resolutions of the Company:

“THAT:

the ATNT Agreement and the connected transactions contemplated thereunder be approved and any one director be and is hereby authorised to sign and execute such documents (and, if required, affix the common seal of the Company thereto) for and on behalf of the Company, in such final form and with such amendments as that director may deem appropriate, and to otherwise do all such things as are necessary to give effect to the ATNT Agreement.”

By Order of the Board Kwok Yan Lam Chairman

Hong Kong, 17th June, 2002

Registered office:

Clarendon House Church Street Hamilton HM11 Bermuda

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Asia Tele-Net and Technology Corporation Limited