GBA Holdings Limited — Proxy Solicitation & Information Statement 2006

Aug 8, 2006

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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 licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your Shares in CCT Tech International Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or the transferee or to the bank, licensed securities dealer or other agent through whom the sale or the transfer was effected for onward transmission to the purchaser or the transferee.

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

(Incorporated in Bermuda with limited liability)

(Stock Code: 261)

CONTINUING CONNECTED TRANSACTIONS

Independent financial adviser to the Independent Board Committee and the Independent Shareholders

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FIRST SHANGHAI CAPITAL LIMITED

A letter from the Board is set out on pages 3 to 11 of this circular.

A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on pages 12 to 13 of this circular.

A letter from First Shanghai containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 14 to 19 of this circular.

A notice convening the SGM to be held at 2208, 22/F., St. George’s Building, 2 Ice House Street, Central, Hong Kong at 10: 00 a.m. on Thursday, 24 August 2006 is set out on pages 26 to 27 of this circular. A form of proxy for use by the Independent Shareholders at the SGM is enclosed herein. Whether or not you intend to attend and vote at the SGM in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the branch share registrar and transfer office of CCT Tech in Hong Kong, Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, as soon as practicable but in any event, not later than 48 hours before the time appointed for holding the SGM. Such form of proxy for use at the SGM is also published on the website of the Stock Exchange (www.hkex.com.hk). Completion and return of the form of proxy will not preclude you from attending and voting at the SGM in person should you so wish.

8 August 2006

CONTENTS

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from	the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Letter from	the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Letter from	First Shanghai . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Appendix	— General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Notice of the SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		26

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DEFINITIONS

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

• ‘‘associate’’ has the same meaning as given to it in the Listing Rules

• ‘‘Board’’ the board of the Directors ‘‘Business Day(s)’’ a day (excluding Saturday and Sunday) on which banks are generally open in Hong Kong for general banking transactions for more than four hours

• ‘‘CCT Tech’’ CCT Tech International Limited, an exempted company incorporated in Bermuda with limited liability and the Shares of which are listed on the main board of the Stock Exchange

• ‘‘CCT Tech Group’’ CCT Tech and its subsidiaries from time to time ‘‘CCT Telecom’’ CCT Telecom Holdings Limited, a company incorporated in the Cayman Islands and continued in Bermuda as an exempted company with limited liability and the shares of which are listed on the main board of the Stock Exchange

• ‘‘CCT Telecom Group’’ CCT Telecom and its subsidiaries from time to time

• ‘‘CCT Telecom Remaining the CCT Telecom Group (other than the CCT Tech Group) Group’’

• ‘‘CEP Manufacturing the consumer electronic products manufacturing agreement entered into Agreement’’ between CCT Telecom and CCT Tech on 14 July 2006 which governs the terms of the Continuing Connected Transactions

• ‘‘connected person’’ has the same meaning as given to it in the Listing Rules

• ‘‘Continuing Connected the transactions as contemplated under the CEP Manufacturing Transactions’’ Agreement to be entered into between the CCT Tech Group and the CCT Telecom Remaining Group in relation to the manufacture of the consumer electronic products and accessories including tooling by the CCT Tech Group for the CCT Telecom Remaining Group pursuant to the terms of the CEP Manufacturing Agreement

• ‘‘Director(s)’’ the director(s) of CCT Tech

• ‘‘First Shanghai’’ First Shanghai Capital Limited, the independent financial adviser to the Independent Board Committee and the Independent Shareholders in relation to the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps and a licensed corporation under the SFO permitted to engage in type 6 (advising on corporate finance) of the regulated activity as defined under the SFO

‘‘HK$’’ Hong Kong dollar(s), the lawful currency of Hong Kong

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DEFINITIONS

‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the People’s Republic of China ‘‘Independent Board the independent board committee of CCT Tech comprising the Committee’’ independent non-executive Directors, namely Messrs. Lau Ho Kit, Ivan, Chow Siu Ngor and Chen Li, which is formed to advise the Independent Shareholders in respect of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps ‘‘Independent the Shareholder(s) other than CCT Telecom and its associates Shareholder(s)’’ ‘‘Latest Practicable Date’’ 4 August 2006, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained therein ‘‘Listing Rules’’ the Rules Governing the Listing of Securities on the Stock Exchange ‘‘SFO’’ Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) ‘‘SGM’’ the special general meeting of CCT Tech to be convened and held to consider and, if thought fit, approve, inter alia, the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps or any adjourment thereof (as the case may be) ‘‘Share(s)’’ the ordinary share(s) of HK$0.01 each in the share capital of CCT Tech ‘‘Shareholder(s)’’ the holder(s) of the Share(s) ‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited ‘‘substantial shareholder’’ has the same meaning as given to it in the Listing Rules ‘‘Transactions Caps’’ the respective caps in relation to the Continuing Connected Transactions for the period of the three financial years ending 31 December 2008 as set out in the sub-section headed ‘‘Transactions Caps’’ under the section headed ‘‘Details of the Continuing Connected Transactions’’ in the letter from the Board of this circular ‘‘%’’ per cent.

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LETTER FROM THE BOARD

(Incorporated in Bermuda with limited liability)

(Stock Code: 261)

Executive Directors: Mak Shiu Tong, Clement Tam Ngai Hung, Terry Cheng Yuk Ching, Flora Tong Chi Hoi Li Man To William Donald Putt

Independent non-executive Directors: Lau Ho Kit, Ivan Chow Siu Ngor Chen Li

Registered office: Canon’s Court 22 Victoria Street Hamilton HM12 Bermuda

Head office and principal place of business in Hong Kong:

2208, 22/F. St. George’s Building 2 Ice House Street Central Hong Kong

8 August 2006

To the Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

Reference is made to the announcement of CCT Tech dated 17 July 2006.

It was announced on 17 July 2006 that CCT Tech entered into the CEP Manufacturing Agreement with CCT Telecom on 14 July 2006 for the manufacture of the consumer electronic products and accessories including tooling by the CCT Tech Group for the CCT Telecom Remaining Group.

CCT Tech is owned as to approximately 74.63% by CCT Telecom and is a non wholly-owned subsidiary of CCT Telecom. As CCT Telecom is a substantial shareholder of CCT Tech, CCT Telecom is a connected person of CCT Tech under the Listing Rules. The transactions between the CCT Telecom Remaining Group and the CCT Tech Group pursuant to the CEP Manufacturing Agreement therefore constitute continuing connected transactions for CCT Tech under the Listing Rules.

As (i) each of the applicable percentage ratios (other than the profits ratio) as set out in Chapter 14A of the Listing Rules in respect of the Continuing Connected Transactions is expected to be higher than 25% on an annual basis; and (ii) the annual consideration for the Continuing Connected Transactions is expected to be more than HK$10,000,000, the Continuing Connected Transactions will be subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules.

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LETTER FROM THE BOARD

The Independent Board Committee has been formed to advise the Independent Shareholders on the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps.

An independent financial adviser, First Shanghai, has been appointed to advise the Independent Board Committee and the Independent Shareholders as to whether or not the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps are fair and reasonable so far as the Independent Shareholders are concerned.

The purpose of this circular is:

• (i) to provide the Shareholders with the details of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps;

• (ii) to set out the opinion of First Shanghai to the Independent Board Committee and the Independent Shareholders in respect of the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps;

• (iii) to set out the recommendation of the Independent Board Committee to the Independent Shareholders in respect of the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps; and

• (iv) to give the Shareholders the notice of the SGM to consider and, if thought fit, to approve the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps.

DETAILS OF THE CONTINUING CONNECTED TRANSACTIONS

The CEP Manufacturing Agreement

Date : 14 July 2006

Parties

• : (1) CCT Telecom (2) CCT Tech

Subject

• : Subject to the terms of the CEP Manufacturing Agreement, CCT Tech will, and/or will procure other members of the CCT Tech Group to, manufacture consumer electronic products and accessories including tooling for CCT Telecom and/or other members of the CCT Telecom Remaining Group based on the orders to be placed by the CCT Telecom Remaining Group from time to time to the CCT Tech Group. The CCT Telecom Remaining Group will purchase the consumer electronic products and accessories including tooling produced by the CCT Tech Group and the CCT Telecom Remaining Group will resell those goods to its customers worldwide through its trading companies. The products that the CCT Telecom Remaining Group purchase from the CCT Tech Group will be different or differentiated from the products that the CCT Tech Group sell to other independent third party customers by means of different design and/or different features. The products to be produced by the CCT Tech Group for the CCT Telecom Remaining Group will be based on the specifications and features provided by the CCT Telecom Remaining Group.

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LETTER FROM THE BOARD

Conditions precedent :

• (a) the passing by the Independent Shareholders at the SGM (with votes to be taken by way of a poll and with CCT Telecom and its associates abstaining from voting at the SGM) of the ordinary resolution(s) approving (1) the CEP Manufacturing Agreement; (2) the Continuing Connected Transactions; and (3) the Transactions Caps; and

• (b) CCT Tech having fully complied with all other rules and regulations under the Listing Rules that are relevant to the proposed arrangements under the CEP Manufacturing Agreement and the Continuing Connected Transactions.

If the above conditions precedent are not fulfilled on or before 15 September 2006 (or such later date as may be agreed between CCT Telecom and CCT Tech in writing), the CEP Manufacturing Agreement shall cease to be of force and effect and the parties hereto shall be released from all obligations hereunder.

Term

• : The CEP Manufacturing Agreement has a fixed term of not exceeding three years as provided under Rule 14A.35 of the Listing Rules and will be effective as from the date when all the conditions precedent have been fulfilled and will continue until 31 December 2008 (both dates inclusive). Both parties may renew the CEP Manufacturing Agreement in writing upon expiry on 31 December 2008 for another three years subject to the compliance with the Listing Rules and either party will have the right to terminate the CEP Manufacturing Agreement without cause by serving the other party with not less than three months’ prior written notice.

Price

• : In respect of the transactions contemplated under the CEP Manufacturing Agreement, the price of the consumer electronic products and accessories including tooling to be payable by the CCT Telecom Remaining Group to the CCT Tech Group shall be determined on an arm’s length basis and shall be fixed on a case-by-case basis, depending on the model to be produced provided that the price shall be capped by the amount of the direct material costs plus a mark-up of no more than 120% of such direct material costs. The sale price in respect of the models of the consumer electronic products and accessories including tooling payable by the CCT Telecom Remaining Group is comparable to that charged by the CCT Tech Group to the other independent customers of the CCT Tech Group. The amount of the sale price will be payable by the CCT Telecom Remaining Group by cash or bank transfer, unless otherwise agreed, will be payable within 60 days from the date of monthly statements which set out the outstanding invoices. The terms of payment are comparable to those credit terms granted to the other third party customers of the CCT Tech Group.

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LETTER FROM THE BOARD

Transactions Caps

Pursuant to the CEP Manufacturing Agreement, the aggregate value of the sales of the Continuing Connected Transactions will not exceed the following respective amounts:

• (1) in respect of the period from the effective date of the CEP Manufacturing Agreement to 31 December 2006, HK$100 million;

• (2) in respect of the financial year ending 31 December 2007, HK$300 million; and

• (3) in respect of the financial year ending 31 December 2008, HK$500 million.

As the trading business is a new business of the CCT Telecom Remaining Group, there is no historical figure regarding the purchase of similar products from the CCT Telecom Remaining Group. The basis of the Transactions Caps amounts is determined with reference to the estimates by CCT Telecom of the value of the Continuing Connected Transactions for the relevant financial period/year. The Transactions Caps are determined by the CCT Telecom Remaining Group based on their estimates of the sales of the products worldwide. The estimation of the Transactions Caps is determined based on the estimated number of units of the consumer electronic products to be traded by the trading companies of the CCT Telecom Remaining Group and the average purchase price of such products. The projections for the increment in 2007 and 2008 are made based on (i) the penetration into the new markets by the trading companies which will lead to the increase in sales; and (ii) the demand for the consumer electronic products will increase in 2007 and 2008 as more new products will be launched and more new markets will be explored. Furthermore, the cap of HK$100 million only covers the period of less than 6 months starting from the effective date of the CEP Manufacturing Agreement to 31 December 2006. Had the CCT Telecom Remaining Group commenced the new trading business on 1 January 2006, the cap for the financial year ending 31 December 2006 would have been HK$200 million. On the other hand, the cap of HK$300 million covers the full financial year ending 31 December 2007. Taking into the time factor, the increment or growth rate for 2007 compared with 2006 would be 50% (((HK$300 million – HK$200 million)/ HK$200 million) x 100%). Similarly, the growth rate for 2008 compared with 2007 would be 67%. The executive Directors consider that the growth rates of 50% and 67% are relatively high as these growth rates cannot be achieved by most mature businesses. However, the executive Directors consider that such high growth rates are reasonable for a new business as the new business starts from zero. As new markets will be penetrated, the sales in the initial years will increase at a fast rate as these high growth rates are determined based on a relatively small base. Therefore, the executive Directors are of the view that the Transactions Caps have been determined on a fair and reasonable basis.

The Transactions Caps represent only about 2.6%, 7.9% and 13.2% of the total revenue of the CCT Tech Group for the year ended 31 December 2005. As such, the executive Directors consider that the new business will increase the turnover and profitability of the CCT Tech Group gradually without any significant adverse impact on the business of the CCT Tech Group or any need for the CCT Tech Group to make any substantial investment on new production lines specifically for such additional business.

REASONS FOR AND BENEFITS OF THE CONTINUING CONNECTED TRANSACTIONS

The CCT Tech Group is currently engaged in the manufacture, sale, design and development of the telecom and electronic products on an original design manufacturing (‘‘ODM’’) basis and a contract manufacturing basis.

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LETTER FROM THE BOARD

The CCT Telecom Group is principally engaged in (i) the manufacture, sale, design and development of the telecom and electronic products through the CCT Tech Group; (ii) the manufacture of the power supply and plastic components; (iii) the manufacture and sale of the baby products; and (iv) the investment in the properties and securities.

CCT Telecom is going to establish trading companies in order to explore new markets, solicit new customers, and promote trading and services for the sale of the consumer electronic products worldwide. CCT Telecom has decided to commit resources to establishing the trading companies including the establishment of overseas trading offices manned by overseas staff that are in closer proximity to its customers. CCT Telecom believes that the trading business will enable the CCT Telecom Group to solicit new customers worldwide and to diversify into new business and new products that will generate substantial additional revenue to the CCT Telecom Group. The executive Directors believe that the new trading business will become one of the principal business activities of the CCT Telecom Remaining Group. The CCT Telecom Remaining Group wants to source certain consumer electronic products from the CCT Tech Group that can be manufactured by the CCT Tech Group. The CCT Tech Group wants to make use of the CCT Telecom Remaining Group’s trading companies to strengthen its existing market and to explore new markets. CCT Telecom and CCT Tech have therefore entered into the CEP Manufacturing Agreement for the manufacture of the consumer electronic products and accessories (including tooling for the production of such products) by the CCT Tech Group for the CCT Telecom Remaining Group for the resale of such consumer electronic products by the CCT Telecom Remaining Group through its trading companies.

The executive Directors are of the view that it is benefit for CCT Tech to enter into the CEP Manufacturing Agreement because of the following reasons:

• (i) the principal business of the CCT Tech Group is the manufacture of the telecom and electronic products on an ODM basis and a contract manufacturing basis. The CCT Tech Group intends to focus on its manufacturing business. It is also in the interests of CCT Telecom and CCT Tech to attach a clearer corporate identity to each of CCT Telecom and CCT Tech, with a view to enabling a better evaluation of their respective businesses;

• (ii) the establishment of the trading companies by the CCT Telecom Remaining Group provides a cost effective means for CCT Telecom to explore new markets, solicit and secure new customers and new business in the worldwide consumer electronic product market. The entering into the CEP Manufacturing Agreement by CCT Tech with CCT Telecom enables the CCT Tech Group to penetrate into new markets and secure orders from new markets through the trading companies of the CCT Telecom Remaining Group which will lead to the increase in the turnover and profitability of the CCT Tech Group;

• (iii) the establishment of the trading companies will involve capital investment of the CCT Telecom Remaining Group. The CEP Manufacturing Agreement will enable the CCT Tech Group to increase sales without the need to fund the investment of the trading companies;

• (iv) the CCT Telecom Remaining Group will be responsible for the management of the trading companies. A number of management staff will be employed overseas by the CCT Telecom Remaining Group. The CEP Manufacturing Agreement allows the CCT Tech Group to enjoy the benefit of the trading companies of the CCT Telecom Remaining Group and yet without the diversion of its business and management resources to run and manage the trading companies so that the CCT Tech Group can focus on its manufacturing operations and its product research and development activities; and

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LETTER FROM THE BOARD

• (v) it is beneficial to the CCT Tech Group to enter into the CEP Manufacturing Agreement as it allows effective share of resources and enhancement of returns to the CCT Tech Group.

The executive Directors consider that the terms of the CEP Manufacturing Agreement have been negotiated on an arm’s length basis and on normal commercial terms and are fair and reasonable and are in the best interests of the CCT Tech Group and the Shareholders as a whole.

The executive Directors are of the view that the CEP Manufacturing Agreement will not be prejudicial to the shareholders of CCT Tech and the CCT Tech Group as a whole since the benefits would be enhanced from both the perspectives of the shareholders of CCT Tech and the CCT Tech Group.

CONDITIONS OF THE CONTINUING CONNECTED TRANSACTIONS

CCT Tech is owned as to approximately 74.63% by CCT Telecom and is therefore a non wholly-owned subsidiary of CCT Telecom. Accordingly, CCT Telecom is a connected person of CCT Tech under the Listing Rules as CCT Telecom is a substantial shareholder of CCT Tech.

The transactions between the CCT Telecom Remaining Group and the CCT Tech Group therefore constitute the continuing connected transactions for CCT Tech under the Listing Rules. The Continuing Connected Transactions are subject to reporting, announcement and independent shareholders’ approval requirements pursuant to Rule 14A.35 of the Listing Rules.

CCT Tech will therefore seek for the approval by the Independent Shareholders of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps for the period of the three financial years ending 31 December 2008 on the following conditions:

• (a) Transactions Caps:

The estimated value of the transactions as set out in the CEP Manufacturing Agreement for each of the three financial years ending 31 December 2008 will not exceed HK$100 million, HK$300 million and HK$500 million, respectively.

• (b) The Continuing Connected Transactions will be in compliance with the followings:

• (i) the Continuing Connected Transactions will be entered into in the usual and ordinary course of businesses of the CCT Tech Group;

• (ii) the Continuing Connected Transactions will be conducted either (A) on normal commercial terms; or (B) if there is no available comparison, on terms no less favourable to the CCT Tech Group than terms available from the independent third parties; and

• (iii) the Continuing Connected Transactions will be entered into in accordance with the terms of the CEP Manufacturing Agreement.

• (c) Brief details of the Continuing Connected Transactions will be disclosed in CCT Tech’s next and each successive annual report, each will be accompanied with a statement of opinion of the independent non-executive Directors in such manner as referred to in paragraph (d) below.

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LETTER FROM THE BOARD

• (d) The independent non-executive Directors will review annually the Continuing Connected Transactions, and they will confirm in CCT Tech’s annual report for the year in question that the Continuing Connected Transactions under their review were conducted in the manner as stated in paragraphs (a) to (c) above.

• (e) The auditors of CCT Tech will review annually the Continuing Connected Transactions, and they will confirm in a letter to the Directors (a copy of which letter will be provided to the Stock Exchange at least 10 Business Days prior to the bulk printing of the annual report of CCT Tech) in respect of each relevant financial year, during which the Continuing Connected Transactions were conducted, stating that:

• (i) the Continuing Connected Transactions have been approved by the Directors;

• (ii) the Continuing Connected Transactions have been entered into in accordance with the relevant agreements governing the transactions;

• (iii) the value of the Continuing Connected Transactions has not exceeded the Transactions Caps set out in paragraph (a) above; and

• (iv) the Continuing Connected Transactions have been entered into in accordance with the pricing policy of the CCT Tech Group,

and where for whatever reasons, if the auditors of CCT Tech decline to accept the engagement or are unable to provide the auditors’ letter to the Directors, the Directors will contact the Listing Division of the Stock Exchange immediately.

• (f) So long as the Shares are listed on the Stock Exchange, CCT Tech will provide to the Stock Exchange an undertaking that CCT Tech will, and will procure CCT Telecom to, provide the auditors of CCT Tech with full access to the relevant records of the Continuing Connected Transactions for the purpose of the auditors’ review as referred to in paragraph (e) above.

• (g) CCT Tech will comply with the applicable provisions of the Listing Rules governing the connected transactions or will apply for the waiver from strict compliance with the relevant requirements in the event that the total amount of the Continuing Connected Transactions exceeds the Transactions Caps, or that there is any material amendment to the terms of the CEP Manufacturing Agreement.

GENERAL

The CCT Tech Group is currently engaged in the manufacture, sale, design and development of the telecom and electronic products on an ODM basis and a contract manufacturing basis.

The CCT Telecom Group is principally engaged in (i) the manufacture, sale, design and development of the telecom and electronic products through the CCT Tech Group; (ii) the manufacture of the power supply and plastic components; (iii) the manufacture and sale of the baby products; and (iv) the investment in the properties and securities.

CCT Tech is owned as to approximately 74.63% by CCT Telecom and is a non wholly-owned subsidiary of CCT Telecom. As CCT Telecom is a substantial shareholder of CCT Tech, CCT Telecom is a connected person of CCT Tech under the Listing Rules. The transactions between the

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LETTER FROM THE BOARD

CCT Telecom Remaining Group and the CCT Tech Group pursuant to the CEP Manufacturing Agreement therefore constitute continuing connected transactions for CCT Tech under the Listing Rules.

As (i) each of the applicable percentage ratios (other than the profits ratio) as set out in Chapter 14A of the Listing Rules in respect of the Continuing Connected Transactions is expected to be higher than 25% on an annual basis; and (ii) the annual consideration for the Continuing Connected Transactions is expected to be more than HK$10,000,000, the Continuing Connected Transactions will be subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules. CCT Telecom and its associates will have to abstain from voting in respect of the resolution(s) for approving the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps at the SGM. The votes at the SGM will be taken by way of a poll.

The Independent Board Committee has been established to advise the Independent Shareholders on the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps. First Shanghai has been appointed to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps.

THE SGM

The notice convening the SGM to be held at 10: 00 a.m. on Thursday, 24 August 2006 at 2208, 22/F., St. George’s Building, 2 Ice House Street, Central, Hong Kong at which the ordinary resolution(s) will be proposed to approve, inter alia, the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps, is set out on pages 26 to 27 of this circular.

A form of proxy for use by the Independent Shareholders at the SGM is enclosed herein. Whether or not you intend to attend and vote at the SGM in person, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the branch share registrar and transfer office of CCT Tech in Hong Kong, Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, as soon as practicable but in any event, not later than 48 hours before the time appointed for holding the SGM. Such form of proxy for use at the SGM is also published on the website of the Stock Exchange (www.hkex.com.hk). Completion and return of the form of proxy will not preclude you from attending and voting at the SGM in person should you so wish.

DEMAND FOR A POLL AT THE SGM

In accordance with bye-law 70 of the bye-laws of CCT Tech, every resolution submitted to a general meeting shall be determined on a show of hands in the first instance by the Shareholders present in person or by duly authorised corporate representative or by proxy, but a poll may be demanded (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) by the chairman of the general meeting or by:

• (a) at least three Shareholders present in person or by duly authorised corporate representative or by proxy for the time being entitled to vote at the general meeting; or

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LETTER FROM THE BOARD

• (b) any Shareholder or the Shareholders present in person or by duly authorised corporate representative or by proxy and representing not less than one-tenth of the total voting rights of all the Shareholders having the right to vote at the general meeting; or

• (c) any Shareholder or the Shareholders present in person or by duly authorised corporate representative or by proxy and holding the Shares conferring a right to vote at the general meeting being the Shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all the Shares conferring that right.

As the transactions contemplated under the CEP Manufacturing Agreement are connected transactions, the vote of the Independent Shareholders at the SGM will be taken by way of a poll pursuant to the Listing Rules and CCT Telecom and its associates will have to abstain from voting at the SGM.

RECOMMENDATION

Having considered the factors mentioned above, the Board considers that it would be in the interest of the Shareholders and CCT Tech as a whole to seek for the approval by the Independent Shareholders of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps. Accordingly, the Board recommends the Independent Shareholders to vote in favour of the resolution(s) to be proposed at the SGM.

Your attention is drawn to the letter from the Independent Board Committee as set out on pages 12 to 13 of this circular which contains its recommendation to the Independent Shareholders on the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps. Your attention is also drawn to the letter of advice from First Shanghai as set out on pages 14 to 19 of this circular which contains, amongst other matters, its advice to the Independent Board Committee and the Independent Shareholders in relation to the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps and the principal factors and reasons considered by it in concluding its advice.

ADDITIONAL INFORMATION

Your attention is also drawn to further information as set out in the appendix, which forms part of this circular.

Yours faithfully, For and on behalf of the Board of CCT TECH INTERNATIONAL LIMITED Mak Shiu Tong, Clement Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

(Incorporated in Bermuda with limited liability)

(Stock Code: 261)

The Independent Board Committee: Lau Ho Kit, Ivan Chow Siu Ngor Chen Li

Registered office: Canon’s Court 22 Victoria Street Hamilton HM12 Bermuda

Head office and principal place of business in Hong Kong:

2208, 22/F. St. George’s Building 2 Ice House Street Central Hong Kong

8 August 2006

To the Independent Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

We refer to the circular of CCT Tech to the Shareholders dated 8 August 2006 (the ‘‘Circular’’), in which this letter forms part. Unless the context otherwise requires, capitalised terms used in this letter will have the same meanings as given to them in the section headed ‘‘Definitions’’ of the Circular.

We have been appointed by the Board as the Independent Board Committee to advise the Independent Shareholders on whether the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps are fair and reasonable so far as the Independent Shareholders are concerned.

We wish to draw your attention to the letter of advice from the independent financial adviser, First Shanghai, as set out on pages 14 to 19 of the Circular and the letter from the Board as set out on pages 3 to 11 of the Circular.

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having considered, amongst other matters, the factors and reasons considered by, and the opinion of First Shanghai as stated in its letter of advice, we consider that the terms of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps are fair and reasonable so far as the Independent Shareholders are concerned and accordingly recommend the Independent Shareholders to vote in favour of the ordinary resolution(s) in relation to the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps to be proposed at the SGM.

Yours faithfully, The Independent Board Committee of CCT TECH INTERNATIONAL LIMITED Lau Ho Kit, Ivan Chow Siu Ngor Chen Li Independent Independent Independent non-executive Director non-executive Director non-executive Director

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LETTER FROM FIRST SHANGHAI

The following is the text of a letter received from First Shanghai setting out its advice to the Independent Board Committee and the Independent Shareholders in respect of the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps for inclusion in this circular.

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FIRST SHANGHAI CAPITAL LIMITED

19th Floor, Wing On House 71 Des Voeux Road Central Hong Kong

8 August 2006

To the Independent Board Committee and the Independent Shareholders

CCT Tech International Limited 2208 22/F, St. George’s Building 2 Ice House Street Central, Hong Kong

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

We refer to our engagement to advise the Independent Board Committee and the Independent Shareholders in respect of the Continuing Connected Transactions, details of which are set out in the circular of CCT Tech dated 8 August 2006 (the ‘‘Circular’’) to the Shareholders of which this letter forms a part. Unless the context otherwise requires, terms used in this letter shall have the same meanings as those defined in the Circular.

As disclosed in the announcement of CCT Tech dated 17 July 2006, on 14 July 2006, CCT Tech entered into the CEP Manufacturing Agreement with CCT Telecom. CCT Tech is owned as to approximately 74.63% by CCT Telecom and is a non wholly-owned subsidiary of CCT Telecom. As CCT Telecom is a substantial shareholder of CCT Tech, CCT Telecom is a connected person of CCT Tech under the Listing Rules. Transactions between the CCT Telecom Remaining Group and the CCT Tech Group pursuant to the CEP Manufacturing Agreement therefore constitute continuing connected transactions for CCT Tech under the Listing Rules. As (i) each of the applicable percentage ratios (other than the profits ratio) as set out in Chapter 14A of the Listing Rules in respect of the Continuing Connected Transactions is expected to be higher than 25% on an annual basis; and (ii) the annual consideration for the Continuing Connected Transactions is expected to be more than HK$10,000,000, the Continuing Connected Transactions will be subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules.

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LETTER FROM FIRST SHANGHAI

Our role, as the independent financial adviser to the Independent Board Committee and the Independent Shareholders, is to give an independent opinion as to whether the terms of the CEP Manufacturing Agreement are fair and reasonable and are in the interests of CCT Tech and the Independent Shareholders as a whole.

In putting forth our opinion and recommendations, we have relied on the accuracy of the information and representations included in the Circular and provided to us by the Directors and CCT Tech, and have assumed that all such information and representations made or referred to in the Circular and provided to us by the Directors and CCT Tech were true at the time they were made and continued to be true as at the date hereof. We have also assumed that all statements of belief, opinion and intention made by the Directors in the Circular were reasonably made after due enquiries. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors and have been advised by the Directors that no material facts have been withheld or omitted from the information provided and referred to in the Circular. 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 the Circular and to provide a reasonable basis for our advice. We have not, however, conducted any independent verification of the information included in the Circular and provided to us by the Directors nor have we conducted any form of investigation into the business, affairs or future prospects of the CCT Tech Group.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our opinion and recommendations as to the fairness and reasonableness of the terms of the CEP Manufacturing Agreement, we have taken into account the following principal factors and reasons:

1. Background

The CCT Tech Group is currently engaged in the manufacture, sale, design and development of telecom and electronic products on an ODM basis and contract manufacturing basis. The CCT Telecom Group is principally engaged in (i) the manufacture, sale, design and development of telecom products and electronic products through the CCT Tech Group; (ii) the manufacture of power supply and plastic components; (iii) the manufacture and sale of baby products; and (iv) the investment in properties and securities.

As mentioned in the ‘‘Letter from the Board’’ in the Circular, CCT Telecom is going to establish trading companies in order to explore new markets, solicit new customers, and promote trading and services for the sale of consumer electronic products worldwide. CCT Telecom has decided to commit resources to establishing the trading companies including the establishment of overseas trading offices manned by overseas staff that are in closer proximity to its customers. CCT Telecom believes that the trading business will enable the CCT Telecom Group to solicit new customers worldwide and to diversify into new business and new products that will generate substantial additional revenue to the CCT Telecom Group. CCT Telecom and CCT Tech have therefore entered into the CEP Manufacturing Agreement for the manufacture of consumer electronic products and accessories (including tooling for the production of such products) by the CCT Tech Group for the CCT Telecom Remaining Group for the resale of such consumer electronic products by the CCT Telecom Remaining Group through its trading companies. We are of the view that the entering into of the CEP Manufacturing Agreement, which will enable the CCT Tech Group to secure certain sales orders, is corresponding with the CCT Tech Group’s core business.

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LETTER FROM FIRST SHANGHAI

2. Reasons for entering into the CEP Manufacturing Agreement

As discussed with the management of CCT Tech, we understand that the executive Directors believe that the new trading business will become one of the principal business activities of the CCT Telecom Remaining Group. By entering into the CEP Manufacturing Agreement, on one hand, the CCT Telecom Remaining Group may source certain consumer electronic products from the CCT Tech Group that can be manufactured by the CCT Tech Group; on the other hand, the CCT Tech Group can make use of the CCT Telecom Group’s trading companies to strengthen its existing market and to explore new markets.

As mentioned in the ‘‘Letter from the Board’’ in the Circular, the executive Directors are of the view that it is benefit for CCT Tech to enter into the CEP Manufacturing Agreement because of the following reasons:

• (i) the principal business of the CCT Tech Group is the manufacture of telecom and electronic products on an ODM basis and a contract manufacturing basis. The CCT Tech Group intends to focus on its manufacturing business. It is also in the interests of CCT Telecom and CCT Tech to attach a clearer corporate identity to each of CCT Telecom and CCT Tech, with a view to enabling a better evaluation of their respective businesses;

• (ii) the establishment of the trading companies by the CCT Telecom Remaining Group provides a cost effective means for CCT Telecom to explore new markets, solicit and secure new customers and new business in the worldwide consumer electronic product market. The entering of the CEP Manufacturing Agreement by CCT Tech with CCT Telecom enables the CCT Tech Group to penetrate into new markets and secure orders from new markets through the trading companies of the CCT Telecom Remaining Group which will lead to the increase in the turnover and profitability of the CCT Tech Group;

• (iii) the establishment of the trading companies will involve capital investment of the CCT Telecom Remaining Group. The CEP Manufacturing Agreement will enable the CCT Tech Group to increase sales without the need to fund the investment of the trading companies;

• (iv) the CCT Telecom Remaining Group will be responsible for the management of the trading companies. A number of management staff will be employed overseas by the CCT Telecom Remaining Group. The CEP Manufacturing Agreement allows the CCT Tech Group to enjoy the benefit of the trading companies of the CCT Telecom Remaining Group and yet without the diversion of its business and management resources to run and manage the trading companies so that the CCT Tech Group can focus on its manufacturing operations and its product research and development activities; and

• (v) it is beneficial to the CCT Tech Group to enter into the CEP Manufacturing Agreement as this allows effective share of resources and enhancement of returns to the CCT Tech Group.

Further to the above mentioned, we have discussed with the management of CCT Tech and understood that the CCT Tech Group is one of the suppliers of the trading companies established by the CCT Telecom Remaining Group and the CCT Telecom Remaining Group

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LETTER FROM FIRST SHANGHAI

may also make purchases from third party manufacturers. Furthermore, the products that the CCT Tech Group will manufacture for the CCT Telecom Remaining Group will be different from those manufactured for its existing third party customers by means of different features and designs. The executive Directors are of the view that the Continuing Connected Transactions may not only strengthen the position of CCT Tech in its existing market, but may also allow the CCT Tech Group to develop new market in terms of geographical locations, new customers and/or new products, which in turn allows the CCT Tech Group to further diversify its business. Having considered the above, we concur with the executive Directors’ view that the CEP Manufacturing Agreement will not be prejudicial to the shareholders of CCT Tech and the CCT Tech Group as a whole since the benefits would be enhanced from both the perspective of the Shareholders and the CCT Tech Group.

3. Key terms of the CEP Manufacturing Agreement and basis of determining the Transactions Caps

Pursuant to the CEP Manufacturing Agreement, the CCT Tech Group will manufacture consumer electronic products and accessories including tooling for the CCT Telecom Group based on orders to be placed by the CCT Telecom Remaining Group from time to time to the CCT Tech Group. The products to be produced by the CCT Tech Group for the CCT Telecom Remaining Group will be based on the specifications and features provided by the CCT Telecom Remaining Group.

Under the CEP Manufacturing Agreement, the price of the consumer electronic products and accessories including tooling to be payable by the CCT Telecom Remaining Group to the CCT Tech Group shall be determined on an arm’s length basis and shall be fixed on a case-bycase basis, depending on the model to be produced provided that the price shall be capped by the amount of direct material costs plus a mark-up of no more than 120% (‘‘Maximum Markup’’) of such direct material costs. To assess the Maximum Mark-up, we have reviewed samples of the sales invoices of the CCT Tech Group and the breakdown of the costs of the direct materials related to the products sold and found that the mark-up of the products under review was below the Maximum Mark-up. As advised by the executive Directors, the Maximum Markup is fixed to allow flexibility of the CCT Tech Group to determine price of new products that may be manufactured by the CCT Tech Group for the CCT Telecom Remaining Group during the term of the CEP Manufacturing Agreement. In any case, the price to be charged by the CCT Tech Group for products to be manufactured for the CCT Telecom Remaining Group will be determined on an arm’s length basis and will be fixed on a case-by-case basis. Furthermore, as mentioned in the ‘‘Letter from the Board’’ in the Circular, it is one of the conditions of the Continuing Connected Transactions that the Continuing Connected Transactions will be conducted on normal commercial terms, or if there is no available comparison, on terms no less favorable to the CCT Tech Group than terms available from the independent third parties. We therefore consider that the Maximum Mark-up is to allow flexibility to the CCT Tech Group in determining pricing and will not have any unfavorable impact on the CCT Tech Group.

Based on our discussion with the management of CCT Tech, we understand that the sale price of the models of the consumer electronic products and accessories including tooling payable by the CCT Telecom Remaining Group is comparable to that charged by the CCT Tech Group to the other independent customers of the CCT Tech Group. The amount payable by the CCT Telecom Remaining Group will be settled by cash or bank transfer, unless otherwise agreed, will be payable within 60 days from the date of monthly statements which set out the outstanding invoices. We note from the annual report of CCT Tech for the year ended 31 December 2005 that the CCT Tech Group generally allows an average credit period of 30 days

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LETTER FROM FIRST SHANGHAI

to 90 days to its trade customers. Furthermore, as advised by the management of CCT Tech and having reviewed the invoices issued by the CCT Tech Group to other third party customers, we note that the terms of payment are comparable to those credit terms granted to the other third party customers of the CCT Tech Group. Having considered the above, we are of the view that the Continuing Connected Transactions will be conducted on normal commercial terms.

As stated in the ‘‘Letter from the Board’’ in the Circular, pursuant to the CEP Manufacturing Agreement, the aggregate sales amount in respect of the Continuing Connected Transactions for the period ending 31 December 2006 and the two financial years ending 31 December 2007 and 2008 will not exceed HK$100 million, HK$300 million and HK$500 million, respectively. We note that the trading business is a new business of the CCT Telecom Remaining Group, and therefore there is no historical figure regarding the purchase of similar products from the CCT Telecom Remaining Group. The management of CCT Tech has also advised that, as at the Latest Practicable Date, the CCT Telecom Remaining Group has not placed any order to the CCT Tech Group. Furthermore, we have discussed with the management of CCT Tech and understood that the Transactions Caps are determined with reference to the estimates by CCT Telecom of the value of the Continuing Connected Transactions for the relevant financial period/year, which are determined based on estimated number of units of the consumer electronic products to be traded by the trading companies of the CCT Telecom Remaining Group and the average purchase price of such products. We have reviewed the sales projection in respect of the Continuing Connected Transactions prepared by CCT Tech based on the mutual discussions between the management of the CCT Tech Group and the CCT Telecom Remaining Group. To assess such sales projection, we have discussed with the management of CCT Tech and understood the followings:

• (1) the estimated number of units of products to be traded by the trading companies is determined by reference to (i) certain preliminary indication of demand from potential customers of the CCT Telecom Remaining Group and (ii) the experience and knowledge of the management of the CCT Tech Group;

• (2) the increase in the Transactions Caps in 2007 and 2008 is expected to be mainly attributable to the increase in the estimated number of units of products to be traded in the respective years, which will be the results of release of new products and more profound relationship with new customers; and

• (3) the estimated purchase price is determined by reference to the average prices of the existing products of the CCT Tech Group with slight increase in 2007 and 2008, taken in consideration the expected release of new products.

Having considered the above basis of determining the estimated number of units of products to be traded by the trading companies and the estimated purchase price of such products, we shared with the executive Directors’ view that the Transactions Caps have been determined on a fair and reasonable basis.

Moreover, we note that the Transactions Caps are estimated to have relative high growth for the period ending 31 December 2006 and the two financial years ending 31 December 2007 and 2008; however, we consider it acceptable as it is a new business of CCT Telecom and such growth rate is therefore calculated on a small initial base. More importantly, as the Transactions Caps represent only approximately 2.6%, 7.9% and 13.2% of the total revenue of the CCT Tech Group for the year ended 31 December 2005, we share with the executive Directors’ view that the entering into of the CEP Manufacturing Agreement is unlikely to have

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LETTER FROM FIRST SHANGHAI

significant adverse impact on the business of the CCT Tech Group. As the Transactions Caps are expected to represent a small percentage of the CCT Tech Group’s total revenue for the term of the CEP Manufacturing Agreement, the executive Directors consider that the production capacity of the CCT Tech Group will be enough to cope with such increase in turnover without any need for the CCT Tech Group to make any substantial investment on new production lines specifically for such additional business. On the positive hand, the new business might increase the turnover and profitability of the CCT Tech Group. Therefore, we consider that the terms of the CEP Manufacturing Agreement are fair and reasonable and the basis of determining the Transactions Caps is acceptable so far as the Independent Shareholders are concerned.

RECOMMENDATION

Having considered the above principal factors and reasons, we are of the opinion that the Continuing Connected Transactions are in the interests of CCT Tech and the Shareholders as a whole and that the terms of the CEP Manufacturing Agreement and the Transactions Caps are fair and reasonable in so far as the Independent Shareholders are concerned. Accordingly, we advise the Independent Board Committee to advise the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the SGM to approve the CEP Manufacturing Agreement, the Continuing Connected Transactions and the Transactions Caps.

Yours faithfully, For and on behalf of First Shanghai Capital Limited Helen Zee Fanny Lee Managing Director Director

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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 CCT Tech. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular with regard to CCT Tech and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, opinions expressed in this circular have been arrived at after due and careful consideration and there are no other facts not contained in this circular, the omission of which would make any statement contained herein misleading.

2. DISCLOSURE OF INTERESTS

(a) The Directors’ interests and short positions in the shares and the underlying shares of the convertible bonds and the share options of CCT Tech and its associated corporations

As at the Latest Practicable Date, the Directors and the chief executive of CCT Tech and their respective associates had the following interests and short positions in the shares, the underlying shares and debentures of CCT Tech and its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to CCT Tech and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register of CCT Tech referred to therein or were required, pursuant to Part XV of the SFO or the Model Code for Securities Transactions by Directors of Listed Issuers contained in the Listing Rules, to be notified to CCT Tech and the Stock Exchange:

• (1) Interests and short positions in the Shares and the underlying Shares of CCT Tech as at the Latest Practicable Date

None of the Directors had interests and short positions in respect of the Shares, debentures, convertible bonds, equity derivatives or interests in the underlying Shares of CCT Tech.

• (2) Interests and short positions in the shares and the underlying shares of the convertible bonds of an associated corporation — CCT Telecom as at the Latest Practicable Date

• (i) Long positions in the shares of CCT Telecom:

					Approximate
	Number of the shares beneficially				percentage of
		held and nature of interest			the total issued
Name of the Director	Personal	Family	Corporate	Total	share capital
					(%)
Mak Shiu Tong, Clement	715,652	—	221,040,977	221,756,629	28.44
Cheng Yuk Ching, Flora	14,076,713	120,000	—	14,196,713	1.82
(Note)
Tam Ngai Hung, Terry	1,868,000	—	—	1,868,000	0.24
Tong Chi Hoi	300,000	—	—	300,000	0.04
William Donald Putt	591,500	—	—	591,500	0.08

Note: Included in the shareholdings in which Ms. Cheng Yuk Ching, Flora was interested, 120,000 shares of CCT Telecom were held by the spouse of Ms. Cheng Yuk Ching, Flora who was deemed to be interested in such shares under the provisions of Part XV of the SFO.

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GENERAL INFORMATION

APPENDIX

• (ii) Long positions in the underlying shares of the convertible bonds of CCT Telecom:

				Approximate
			Number of the	percentage of
	Description of		total underlying	the total issued
Name of the Director	equity derivatives	Notes	shares	share capital
				(%)
Mak Shiu Tong, Clement	2010 convertible bonds	(1)	47,185,430	6.05
	2009 convertible bonds	(2)	26,548,672	3.40

Notes:

• (1) The convertible bonds with an outstanding principal amount of HK$28,500,000 as at the Latest Practicable Date, were issued by CCT Telecom to New Capital Industrial Limited (a company controlled by Mr. Mak Shiu Tong, Clement) on 25 April 2005. The convertible bonds, due on 25 April 2010, are interest free and convertible into the shares of CCT Telecom at the conversion price of HK$0.604 per share of CCT Telecom (subject to adjustments according to the terms of the convertible bonds).

• (2) The convertible bonds with an outstanding principal amount of HK$30,000,000 as at the Latest Practicable Date, were issued by CCT Telecom to Capital Winner Investments Limited (a company controlled by Mr. Mak Shiu Tong, Clement) on 23 June 2006. The convertible bonds, due on 23 June 2009, are interest free and convertible into the shares of CCT Telecom at the conversion price of HK$1.13 per share of CCT Telecom (subject to adjustments according to the terms of the convertible bonds).

• (3) Interests and short positions in the shares and the underlying shares of the share options of an associated corporation — Tradeeasy Holdings Limited (‘‘Tradeeasy’’) as at the Latest Practicable Date

Long positions in the underlying shares of the share options of Tradeeasy, which is a fellow subsidiary of CCT Tech:

			Number of the
			total underlying	Approximate
		Number of	shares	percentage of
	Exercise	the share	represented by	the total
	price per	options to	the share	issued share
Name of the Director	share	be granted	options	capital
	HK$			(%)
Mak Shiu Tong, Clement	0.038	45,000,000#	45,000,000#	4.63
Tam Ngai Hung, Terry	0.038	28,000,000#	28,000,000#	2.88
Cheng Yuk Ching, Flora	0.038	5,000,000#	5,000,000#	0.51
William Donald Putt	0.038	5,000,000#	5,000,000#	0.51

• The directors of Tradeeasy approved the conditional grant of the above share options of Tradeeasy to the executive Directors on 5 July 2006, who are also executive directors of Tradeeasy. The respective independent non-executive directors of each of Tradeeasy and CCT Telecom also approved the grant of the share options on 5 July 2006. The respective shareholders of each of Tradeeasy and CCT Telecom also approved the grant of the share options at the respective general meetings of each of Tradeeasy and CCT Telecom held on 27 July 2006. However, the grant of the share options is subject to the grant by the Listing Committee of the Growth Enterprise Market of the Stock Exchange of the listing of, and permission to deal in, the shares of Tradeeasy which may fall to be issued pursuant to the exercise of the share options of Tradeeasy.

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GENERAL INFORMATION

APPENDIX

(b) Particulars of the Directors’ other interests

As at the Latest Practicable Date, none of the Directors had entered or was proposing to enter into a service contract with CCT Tech or any other members of the CCT Tech Group (excluding contracts expiring or determinable by CCT Tech or any other members of the CCT Tech Group within one year without payment of compensation other than statutory compensation).

(c) Save as disclosed above, as at the Latest Practicable Date

• (i) none of the Directors and the chief executive of CCT Tech and their respective associates held any interests or short positions in the shares, the underlying shares and debentures of CCT Tech or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to CCT Tech and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register of CCT Tech referred to therein or were required, pursuant to Part XV of the SFO or the Model Code for Securities Transactions by Directors of Listed Issuers contained in the Listing Rules, to be notified to CCT Tech and the Stock Exchange; and

• (ii) none of the Directors was interested in any business that was in competition with the CCT Tech Group.

3. SUBSTANTIAL SHAREHOLDERS’ INTERESTS

As at the Latest Practicable Date, so far as was known to, or could be ascertained after reasonable enquiries by, the Directors, the following persons (other than the Directors or the chief executive of CCT Tech) had interests or short positions in the Shares or the underlying Shares as recorded in the register required to be kept by CCT Tech under section 336 of the SFO:

• (i) Long positions in the Shares as at the Latest Practicable Date:

			Approximate
			percentage of
		Number of the	the total issued
Name of the Shareholder	Notes	Shares held	share capital
			(%)
CCT Telecom	(1)	48,035,751,124	74.63
CCT Technology Investment Limited	(2)	48,035,751,124	74.63
Jade Assets Company Limited		44,335,751,124	68.88
Deutsche Bank Aktiengesellschaft		6,430,262,699	9.99

Notes:

• (1) The interest disclosed represents 48,035,751,124 Shares indirectly owned by CCT Technology Investment Limited through the subsidiaries stated in Note (2) below. CCT Technology Investment Limited is a wholly-owned subsidiary of CCT Telecom.

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GENERAL INFORMATION

APPENDIX

• (2) The interest disclosed represents 44,335,751,124 Shares held by Jade Assets Company Limited, 1,350,000,000 Shares held by CCT Assets Management Limited, 1,350,000,000 Shares held by Expert Success International Limited and 1,000,000,000 Shares held by Noble Team Investments Limited, all of them are wholly-owned subsidiaries of CCT Technology Investment Limited.

• (ii) Long positions in the underlying Shares of equity derivatives of CCT Tech as at the Latest Practicable Date:

		Number of the
		underlying	Approximate
		Shares interested	percentage of
		under equity	the total issued
Name of the Shareholder	Notes	derivatives	share capital
			(%)
CCT Telecom	(1)	13,800,000,000	21.44
Deutsche Bank Aktiengesellschaft	(2)	7,369,737,301	11.45

Notes:

• (1) The interest disclosed represents long positions in 13,800,000,000 underlying Shares which may possibly be acquired by CCT Telecom upon the exercise of the put options granted by CCT Telecom to Deutsche Bank AG in relation to the sale of 13,800,000,000 Shares under the terms of the put agreement entered into between CCT Telecom and Deutsche Bank AG on 17 March 2006.

• (2) The interest disclosed represents long positions in 7,369,737,301 underlying Shares which may possibly be acquired by Deutsche Bank AG upon the exercise of the put options granted by Deutsche Bank AG to the three third party investors, which were introduced by Deutsche Bank AG to buy 7,369,737,301 Shares from CCT Telecom.

• (iii) Short positions in the underlying Shares of equity derivatives of CCT Tech as at the Latest Practicable Date:

	Number of the
	underlying	Approximate
	Shares interested	percentage of
	under equity	the total issued
Name of the Shareholder	derivatives	share capital
		(%)
Deutsche Bank Aktiengesellschaft (Note)	13,800,000,000	21.44

Note: The interest disclosed represents short positions in 13,800,000,000 underlying Shares whereas Deutsche Bank AG has a right to sell back part or whole of 13,800,000,000 Shares to CCT Telecom by exercising of the put options granted by CCT Telecom to Deutsche Bank AG under the terms of the put agreement entered into between CCT Telecom and Deutsche Bank AG on 17 March 2006.

Save as disclosed above, so far as was known to the Directors, as at the Latest Practicable Date, there was no other person (other than the Directors or the chief executive of CCT Tech) who had any interests or short positions in the Shares and the underlying Shares as recorded in the register required to be kept by CCT Tech under section 336 of the SFO.

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GENERAL INFORMATION

APPENDIX

4. LITIGATION

As at the Latest Practicable Date, neither CCT Tech nor any member of the CCT Tech Group was engaged in any litigation or arbitration of material importance and no litigation or claim of material importance was known to the Directors to be pending or threatened by or against CCT Tech or any member of the CCT Tech Group.

5. MATERIAL ADVERSE CHANGE

Save as disclosed herein, as at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the CCT Tech Group since 31 December 2005, being the date to which the latest published audited financial statements of CCT Tech were made up.

6. INTERESTS IN ASSETS AND/OR CONTRACTS AND OTHER INTERESTS

As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any asset which had been, since 31 December 2005, being the date of the latest published audited accounts of CCT Tech were made up, acquired or disposed of by or leased to any member of the CCT Tech Group or were proposed to be acquired or disposed of by or leased to any member of the CCT Tech Group.

As at the Latest Practicable Date, none of the Directors was materially interested in any contract or arrangement entered into by any member of the CCT Tech Group which contract or arrangement was subsisting and which was significant in relation to the business of the CCT Tech Group taken as a whole.

7. QUALIFICATION AND CONSENT OF EXPERT

First Shanghai has given and has not withdrawn its written consent to the issue of this circular with the copy of its letter and reference to its name included herein in the form and context in which they appear.

The qualification of the expert who has provided its advice as contained in this circular is as follows:

Name Qualification

First Shanghai A corporation licensed under the SFO permitted to engage in type 6 (advising on corporate finance) of the regulated activities as defined under the SFO

As at the Latest Practicable Date, First Shanghai was not interested in any Share or share in any member of the CCT Tech Group, nor did it have any right or option (whether legally enforceable or not) to subscribe for or nominate persons to subscribe for any Share or share in any member of the CCT Tech Group.

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GENERAL INFORMATION

APPENDIX

8. MISCELLANEOUS

• (a) The registered office of CCT Tech is located at Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda and the head office and the principal place of business of CCT Tech in Hong Kong is located at 2208, 22/F., St. George’s Building, 2 Ice House Street, Central, Hong Kong.

• (b) The branch share registrar and transfer office of CCT Tech in Hong Kong is Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong.

• (c) The qualified accountant of CCT Tech is Mr. Ho Yiu Hong, Victor, who is a fellow of the Association of Chartered Certified Accountants and an associate of both the Institute of Chartered Secretaries and Administrators and the Hong Kong Institute of Certified Public Accountants.

• (d) The company secretary of CCT Tech is Ms. Low Pui Man, Jaime, who is a fellow of both The Institute of Chartered Secretaries and Administrators and The Hong Kong Institute of Chartered Secretaries.

• (e) In the event of inconsistency, the English text of this circular shall prevail over the Chinese text.

9. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the head office and the principal place of business of CCT Tech in Hong Kong at 2208, 22/F., St. George’s Building, 2 Ice House Street, Central, Hong Kong during normal business hours on any Business Day from the date of this circular up to and including the date of the SGM:

• (a) the memorandum of association and the bye-laws of CCT Tech;

• (b) the letter from the Board to the Shareholders, the text of which is set out on pages 3 to 11 of this circular;

• (c) the letter of recommendation from the Independent Board Committee to the Independent Shareholders, the text of which is set out on pages 12 to 13 of this circular;

• (d) the letter of advice from First Shanghai to the Independent Board Committee and the Independent Shareholders, the text of which is set out on pages 14 to 19 of this circular;

• (e) the written consent from First Shanghai referred to in the section headed ‘‘Qualification and Consent of Expert’’ in this appendix;

• (f) the CEP Manufacturing Agreement; and

• (g) this circular.

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NOTICE OF THE SGM

(Incorporated in Bermuda with limited liability)

(Stock Code: 261)

NOTICE IS HEREBY GIVEN that a special general meeting of the shareholders of CCT Tech International Limited (the ‘‘Company’’) will be held at 2208, 22/F., St. George’s Building, 2 Ice House Street, Central, Hong Kong on Thursday, 24 August 2006 at 10: 00 a.m. for the purpose of considering and, if thought fit, passing with or without modifications, the following resolution as an ordinary resolution of the Company:

ORDINARY RESOLUTION

‘‘THAT:

• (a) the consumer electronic products manufacturing agreement (the ‘‘CEP Manufacturing Agreement’’) dated 14 July 2006 entered into between the Company and CCT Telecom Holdings Limited (‘‘CCT Telecom’’, together with its subsidiaries, the ‘‘CCT Telecom Group’’), a copy of which is tabled at the meeting and marked ‘‘A’’ and initialled by the chairman of the meeting for identification purpose, pursuant to which the Company will, and/or will procure its subsidiaries (the Company and its subsidiaries hereinafter referred to as the ‘‘Group’’) to, manufacture consumer electronic products and accessories including tooling for the CCT Telecom Group other than the Group (the ‘‘CCT Telecom Remaining Group’’) based on the orders to be placed by the CCT Telecom Remaining Group from time to time to the Group and the CCT Telecom Remaining Group will purchase the consumer electronic products and accessories including tooling produced by the Group for the resale of those goods to its customers worldwide through its trading companies, and the transactions contemplated thereunder be and are hereby approved, ratified and confirmed;

• (b) the proposed caps in relation to the Continuing Connected Transactions (as defined in the circular of the Company dated 8 August 2006 (the ‘‘Circular’’)), a copy of which is tabled at the meeting and marked ‘‘B’’ and initialled by the chairman of the meeting for identification purpose, for each of the three financial years ending 31 December 2008, being HK$100 million, HK$300 million and HK$500 million respectively be and are hereby approved; and

• (c) any one director of the Company, or any two directors of the Company if the affixation of the common seal is necessary, be and is/are hereby authorised for and on behalf of the Company to execute all such other documents, instruments and agreements and to do all such acts or things deemed by him/her/them to be incidental to, ancillary to or in connection with the matters contemplated in and completion of the CEP Manufacturing Agreement and/or the Continuing Connected Transactions (as defined in the Circular).’’

By Order of the Board of

CCT TECH INTERNATIONAL LIMITED Mak Shiu Tong, Clement Chairman

Hong Kong, 8 August 2006

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NOTICE OF THE SGM

Head office and principal place of business in Hong Kong:

2208, 22/F. St. George’s Building 2 Ice House Street Central Hong Kong

Notes:

1. A form of proxy for use at the meeting is enclosed herewith.

2. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his/her attorney duly authorised in writing or, if the appointor is a corporation, either executed under its common seal or under the hand of any officer, attorney or other person duly authorised on that corporation’s behalf to sign the same.

3. Any shareholder entitled to attend and vote at the meeting is entitled to appoint another person as his/her proxy to attend and vote instead of him/her. A shareholder who is the holder of two or more shares may appoint not more than two proxies (who must be an individual or individuals) to attend and vote instead of him/her on the same occasion. A proxy need not be a shareholder of the Company but must attend the meeting in person to represent him/her.

4. In order to be valid, the form of proxy in the prescribed form, together with the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, must be lodged with the branch share registrar and transfer office of the Company in Hong Kong, Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, not later than 48 hours before the time appointed for holding the meeting or any adjourned meeting thereof (as the case may be). Such prescribed form of proxy for use at the meeting is also published on the website of The Stock Exchange of Hong Kong Limited at www.hkex.com.hk.

5. Completion and return of the form of proxy will not preclude a shareholder from attending and voting in person at the meeting or any adjourned meeting thereof (as the case may be) should they so wish and in such event, the form of proxy shall be deemed to be revoked.

6. Where there are joint registered holders of any share(s), any one of such joint holders may attend and vote at the meeting or at any adjourned meeting thereof (as the case may be), either in person or by proxy, in respect of such share(s) as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the meeting or any adjourned meeting thereof (as the case may be), the most senior shall alone be entitled to vote, whether in person or by proxy. For this purpose, seniority will be determined by the order in which the names stand in the register of members of the Company in respect of the joint holding.

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