Inspur Digital Enterprise Technology Limited — Proxy Solicitation & Information Statement 2011

Nov 11, 2011

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you are in doubt as to any aspect of this circular, 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 Inspur 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, stockbroker or other agent through whom the sale or the transfer was effected for transmission to the purchaser or the transferee.

INSPUR INTERNATIONAL LIMITED 浪潮國際有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 596)

VARIATION OF THE TERMS OF PREFERRED SHARES; AND AMENDMENTS TO THE ARTICLES OF ASSOCIATION

Independent financial adviser to the Independent board committee and the independent shareholders of the Company

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FIRST SHANGHAI CAPITAL LIMITED

A notice convening an ordinary shares class meeting (“Class Meeting”) of the Company to be held at Flats B & C, 30/F., Tower A, Billion Center, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong at 10:00 a.m. on 6 December 2011 (Tuesday) is set out on pages 29 to 33 of this circular. A form of proxy for use at the Class Meeting is enclosed with this circular. Such form of proxy is also published on the websites of the Company and the Stock Exchange at www.hkex.com.hk.

A notice convening an Extraordinary General Meeting (“EGM”) of Inspur International Limited to be held at Flats B & C, 30/F., Tower A, Billion Center, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong on, 6 December 2011 (Tuesday) at 10:30 a.m. is set out on pages 34 to 38 of this circular. A form of proxy for use at the EGM is enclosed with this circular. Such form of proxy is also published on the website of The Stock Exchange of Hong Kong Limited at www.hkex.com.hk.

Whether or not you intend to attend the Class Meeting and the EGM, you are requested to complete the form of proxy and return the same to the office of the Company’s branch share registrar and transfer office in Hong Kong, Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time appointed for the meeting (or any adjourned meeting). Completion and delivery of the form of proxy will not preclude you from attending and voting at the meeting (or any adjourned meeting) if you so wish.

14 November 2011

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Letters of Advice from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . .	14
Letter of Advice from First Shanghai . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
Appendix — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	22
Notice of the Class Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29
Notice of the EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	34

— i —

DEFINITIONS

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

“associate(s)” has the meaning ascribed to it under the Listing Rules “Board” the board of Directors “Class Meeting” the separate class meeting of the holders of Ordinary Shares to be convened and held for the approving, amongst other things, the Supplemental Deed

• “Company” Inspur International Limited, an exempted company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the main board of the Stock Exchange

• “connected person(s)” has the meaning ascribed to it under the Listing Rules “Director(s)” the director(s) of the Company “Disposal” the disposal of 415,873,000 Ordinary Shares (to be converted from Preferred Shares) by Microsoft to a purchaser under an agreement entered into on 31 October 2011 by and between Microsoft and the purchaser

• “EGM” the extraordinary general meeting of the Company to be convened and held for the approving, amongst other things, the Supplemental Deed

• “First Shanghai” First Shanghai Capital Limited, a licensed corporation to carry on type 6 regulated activity (advising on corporate finance) under the SFO, being the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders on the fairness and reasonableness of the Supplemental Deed and the transactions contemplated thereunder

• “Group” the Company and its subsidiaries

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

• “Independent Shareholders” Shareholders other than Microsoft and its associates

• “Independent Board Committee”

An independent board committee, comprising Mr. Meng Xiang Xu, Mr. Zhang Tiqin and Mr. Wong Lit Chor, Alexis, all being the independent non-executive directors, to advise the Independent Shareholders as to the fairness and reasonableness of the Supplemental Deed

— 1 —

DEFINITIONS

“Inspur Group”	Inspur Group Limited (浪潮集團有限公司) which is a
	company established in the People’s Republic of China and is
	indirectly interested in approximately 32.19% of the existing
	issued ordinary shares of the Company
“Latest Practicable Date”	11 November 2011, being the latest practicable date prior to
	printing of this circular for ascertaining certain information
	contained herein
“Listing Rules”	The Rules Governing the Listing of Securities on the Stock
	Exchange
“Long Stop Date”	6 December 2011
“Microsoft”	Microsoft Corporation, a corporation incorporated in the USA
	and the holder of the Preferred Shares
“Ordinary Share(s)”	ordinary share(s) of HK$0.002 each in the share capital of the
	Company
“Preferred Shares”	series A senior redeemable convertible voting preferred
	shares of par value HK$0.01 each
“Shares”	shares in the capital of the Company (being the Ordinary
	Shares and the Preferred Shares)
“Share Options”	the share options which are granted pursuant to pre-IPO
	employee share option scheme, the two post-IPO employee
	share option schemes adopted by the Company on 4 April
	2004 and 10 November 2008
“Shareholder(s)”	holder(s) of the Preferred Share(s) and Ordinary Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“SFO”	Securities and Futures Ordinance (chapter 571 of the laws of
	Hong Kong)
“Subscription Deed”	the deed entered into between the Company and Microsoft
	dated 26 August 2005 as supplemented by three supplemental
	deeds dated 7 September 2005, 13 September 2005 and 24
	September 2009 in relation to the subscription for the
	Preferred Shares
“Supplemental Deed”	the supplemental deed to the Subscription Deed between the
	Company and Microsoft dated 31 October 2011 in relation to,
	among others, extension of maturity of Preferred Shares
“USA”	The United States of America

— 2 —

	DEFINITIONS
“US$”	US dollars, the lawful currency of the USA
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“%”	per cent

All the English translation of certain Chinese names or words in this circular is included for information purpose only, and should not be regarded as the official English translation of such Chinese names or words.

— 3 —

LETTER FROM THE BOARD

INSPUR INTERNATIONAL LIMITED 浪潮國際有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 596)

Executive Directors:

Mr. Sun Pishu ( Chairman ) Mr. Wang Xingshan Mr. Chen Dongfeng Mr. Dong Hailong

Registered office:

Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Independent non-executive Directors:

Mr. Meng Xiang Xu Mr. Zhang Tiqin Mr. Wong Lit Chor, Alexis

Head office and principal place of business in Hong Kong:

Flats B & C, 30/F. Tower A, Billion Centre 1 Wang Kwong Road Kowloon Bay Kowloon Hong Kong

14 November 2011

To the Shareholders

Dear Sir or Madam,

VARIATION OF THE TERMS OF PREFERRED SHARES; AND AMENDMENTS TO THE ARTICLES OF ASSOCIATION

INTRODUCTION

Reference is made to the Company’s announcement dated 31 October 2011. On 31 October 2011, the Company (as the issuer) entered into the Supplemental Deed with Microsoft (as the subscriber) to vary the terms of Preferred Shares with the effect that, among others, the maturity date of the Preferred Shares will be extended for a further period of two years from 8 December 2011 subject to fulfilment of certain conditions. As Microsoft is a connected person of the Company, the transactions contemplated under the Supplemental Deed constitute a connected transaction on the part of the Company under the Listing Rules. The Company also takes this opportunity to propose at each of the Class Meeting and the EGM a special resolution approving proposed amendments to the Memorandum and the Articles of Association of the Company in relation to the proposed variation of the terms of the Preferred Shares.

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LETTER FROM THE BOARD

The purpose of this circular is to provide you with information regarding, among other things, (i) further information about the Supplemental Deed; (ii) further information about the proposed amendments to the Articles of Association of the Company; (iii) the letter from First Shanghai to the Independent Board Committee and the Independent Shareholders; (iv) the recommendation from the Independent Board Committee to the Independent Shareholders; and (v) the notices of the Class Meeting and the EGM.

SUPPLEMENTAL DEED

Date

31 October 2011

Parties

• (1) the Company as the issuer; and

• (2) Microsoft as the subscriber.

Variation of the terms of the Preferred Shares

Under the Supplemental Deed, the terms of the Preferred Shares will be amended in relation to the following matters:

• (a) the maturity date of the Preferred Shares will be extended for a further period of two years commencing on 8 December 2011 (“ Restructuring Date ”);

• (b) the rate of dividend payable to the holder of Preferred Shares will be increased from 6% per annum (calculated on the outstanding principal amount of the Preferred Shares) to 9% per annum from the Restructuring Date;

• (c) the dividend will be payable to holder of Preferred Shares in form of cash only, and there will be no scrip dividend payable after the Restructuring Date; and

• (d) when the dividend payable to holders of Ordinary Shares exceeds HK$0.013 (“ Current Average per Share Dividend ”) per Ordinary Share in a financial year, the Company will pay the holder of Preferred Shares the excess dividend (which is equal to Excess Dividend x Number of Ordinary Shares which the outstanding Preferred Shares can be converted into

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LETTER FROM THE BOARD

on such date. “Excess Dividend” means the Dividend per Ordinary Share payable in a financial year minus the Current Average per Share Dividend. The dividend history of the Company in the past three years is as follows:

Financial year Dividend Year ended 31 December 2010 1 cent per Ordinary Share Year ended 31 December 2009 1 cent per Ordinary Share Year ended 31 December 2008 2 cents per Ordinary Share

Redemption of certain Preferred Shares

Please refer to the paragraph headed “Future Possible Changes to the Shareholding Structure” set forth below for details in relation to the redemption by Microsoft of certain Preferred Shares.

Conditions of the Supplemental Deed

Even though Microsoft and the Company have entered into the Supplemental Deed, the effectiveness of the Supplemental Deed is subject to the fulfillment of the following conditions on or before the Long Stop Date:

• (a) the passing by the Independent Shareholders in a general meeting of:

• (i) an ordinary resolution approving and ratifying the entering into the Supplemental Deed by the Company and the variation of the terms of the Preferred Shares and the other transactions contemplated under the Supplemental Deed; and

• (ii) a special resolution approving the proposed amendments to the Memorandum and Articles of Association of the Company in connection with the foregoing;

in accordance with the requirements of the Listing Rules, Memorandum and Articles of Association of the Company and applicable law;

• (b) the granting of the approval of the Stock Exchange (if required) for variation of the terms of Preferred Shares and the Subscription Deed;

• (c) all necessary consents required to be obtained by the Company and Microsoft being granted by third parties (including, governmental or official authorities) for the transactions contemplated under the Supplemental Deed having been obtained, and all necessary filings, notifications and other regulatory requirements to which the Company is subject, having been made or satisfied;

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LETTER FROM THE BOARD

• (d) the delivery by the Company to Microsoft of a certified copy of the Board resolutions approving, among other things, the matters referred to in condition (a) above and the completion of any necessary actions to be taken by the Directors for giving effect thereto;

• (e) the form and substance of the proposed amended memorandum and articles of association of the Company (reflecting the terms of the Supplemental Deed) being reasonably satisfactory to Microsoft;

• (f) the delivery by the Subscriber of the redemption notice in relation to certain Preferred Shares pursuant to the terms of the Supplemental Deed, and the Company having redeemed such Preferred Shares in accordance with the terms of the Supplemental Deed;

• (g) the delivery by the Company to Microsoft of a legal opinion issued by the Company’s legal advisers as to Cayman Islands law and Hong Kong law in such form and substance acceptable to Microsoft; and

• (h) the delivery by Microsoft to the Company of a written consent to the variation and modification of the terms of Preferred Shares pursuant to the Supplemental Deed as required under the Memorandum and Articles of Association of the Company in such form and substance acceptable to the Company.

As at the Latest Practicable Date, none of the above conditions have been fulfilled.

In the event that any of the conditions stated above is not fulfilled (or waived by Microsoft other than (a), (b) and (h) which may not be waived) before the Long Stop Date, the Supplemental Deed shall automatically become null and void and shall cease to have any force or effect but without prejudice to any claim arising under the Supplemental Deed out of any antecedent breach of the Supplemental Deed by any party.

DIVIDEND OF PREFERRED SHARES

Under the Articles of Association of the Company, holder of Preferred Shares is entitled to receive out of funds of the Company available for distribution and resolved to be distributed as dividend to the holder of the Preferred Shares, in priority to any other classes of shares in the capital of the Company. The dividend is calculated at the rate of 6% per annum on the principal amount of the Preferred Shares (which is the subscription price for the relevant Preferred Shares). The dividend is cumulative and payable in US$ quarterly in arrears on 31st March, 30th June, 30th September and 31st December each year. For period commencing from 1 October 2009, the dividend, instead of wholly by cash in US$, has been paid to the holder of Preferred Shares (i) as to one-third (1/3) thereof by cash in US$, and (ii) as to two-thirds (2/3) thereof by scrip dividend. The issue price of the scrip dividend is equal to the average closing price of Ordinary Shares on the Stock Exchange for the 10 consecutive trading days immediately prior to the date of dividend payment.

— 7 —

LETTER FROM THE BOARD

FUTURE POSSIBLE CHANGES TO THE SHAREHOLDING STRUCTURE

Microsoft has informed the Company that on 31 October 2011 it entered into an agreement with a purchaser whereby Microsoft has agreed to sell to the purchaser 415,873,000 Ordinary Shares which will be issued to Microsoft upon conversion of 83,174.600 Preferred Shares (the aforesaid transaction is referred to hereinafter as “ Disposal ”). In relation to this conversion, Microsoft has delivered a conversion notice for 83,174,600 Preferred Shares to the Company on 31 October 2011. On 1 November 2011, the Company issued 415,873,000 Ordinary Shares pursuant to the conversion of 83,174,600 Preferred Shares. On 7 November 2011, the Disposal was completed.

Under the Supplemental Deed, Microsoft has agreed to deliver a notice to the Company to require the Company to redeem 95,056,686 Preferred Shares on 8 December 2011 (being the maturity date of the Preferred Shares under the Subscription Deed prior to its amendment pursuant to the Supplemental Deed) in accordance with the Subscription Deed and the Articles of Association of the Company.

If the redemption of 95,056,686 Preferred Shares takes place, Microsoft will be the holder of 72,859,049 Preferred Shares which can be converted into 297,052,141 Ordinary Shares (representing about 6.59% of the total voting rights of the Company if there is no other change to the share capital of the Company) subject to the terms of the Subscription Deed and the Memorandum and Articles of Association of the Company.

The principal amounts and the conversion prices of the Preferred Shares immediately before and after the redemption of 95,056,686 Preferred Shares are as follows :

(i) Immediately before the redemption

Issue Date No. of Preferred Shares 8/12/2005 49,789,742 21/4/2006 101,315,217 31/12/2009 1,832,495 31/3/2010 1,866,903 30/6/2010 2,717,486 30/9/2010 3,104,868 31/12/2010 3,097,560 31/3/2011 4,191,464 Total 167,915,735	Principal Amounts Conversion Price (per Ordinary Share) HK$ HK$ 37,840,204 0.1520 93,210,000 0.1840 1,957,105 1.0680 1,935,978 1.0370 1,983,765 0.7300 2,018,164 0.6500 2,041,292 0.6590 2,018,190 0.4815 143,004,698

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LETTER FROM THE BOARD

(ii) Immediately after the redemption

Issue Date No. of Preferred Shares 21/4/2006 56,048,273 31/12/2009 1,832,495 31/3/2010 1,866,903 30/6/2010 2,717,486 30/9/2010 3,104,868 31/12/2010 3,097,560 31/3/2011 4,191,464 Total 72,859,049	Principal Amounts Conversion Price (per Ordinary Share) HK$ HK$ 51,564,411 0.1840 1,957,105 1.0680 1,935,978 1.0370 1,983,765 0.7300 2,018,164 0.6500 2,041,292 0.6590 2,018,190 0.4815 63,518,905

The following table illustrates (i) the existing shareholding structure as at the Latest Practicable Date; and (ii) the shareholding structure immediately upon the completion of the redemption of 95,056,686 Preferred Shares, on the assumption of no other change to the share capital of the Company.

				Upon the completion of	Upon the completion of	Upon the completion of
	**As at **	the Latest Practicable Date			the Redemption
		Voting Rights	% of Voting		Voting Rights	_% of _	Voting
Shareholders	Ordinary Shares	(Shares)	Rights	Shares	(Shares)		Rights
Inspur Group	1,354,390,000	1,354,390,000	27.20	1,354,390,000	1,354,390,000		30.07
Public Shareholders	2,853,050,291	2,853,050,291	57.29	2,853,050,291	2,853,050,291		63.34
Sub-Total	4,207,440,291	4,207,440,291	84.49	4,207,440,291	4,207,440,291		93.41
	Preferred		% of Voting	Preferred		_% of _	Voting
	Shares	Voting Rights	Rights	Shares	Voting Rights		Rights
Microsoft Corporation	167,915,735	772,335,571	15.51	72,859,049	297,052,141		6.59
Sub-Total	167,915,735			72,859,049	297,052,141
Grand Total		4,979,775,862	100		4,504,492,432		100

Note: As at the date of the Latest Practicable Date, there are: (a) outstanding 80,100,000 Share Options which entitle the holders to subscribe for 80,100,000 Ordinary Shares; The above table is prepared on the assumption that no Share Option is exercised into Ordinary Share.

— 9 —

LETTER FROM THE BOARD

REASONS FOR AND BENEFITS DERIVED FROM ENTERING INTO THE SUPPLEMENTAL DEED

By entering into the Supplemental Deed and obtaining the necessary approvals to implement the terms of the Supplemental Deed, Microsoft will continue to be strategic shareholder of the Company so as to enhance the business relationship between the Group and Microsoft in a number of areas in information technology industry resulting in common synergies and benefits for the Group and Microsoft. With the support of the two substantial shareholders of the Company, Inspur Group and Microsoft, the Group can speed up its transformation into a cloud computer service provider.

If the Shareholders do not pass the resolutions at the Class Meeting and the EGM approving, amongst other things, the Supplemental Deed, the maturity date of the Preferred Shares cannot be extended for a further period of two years. In such case, Microsoft may redeem all the outstanding Preferred Shares or convert all the outstanding Preferred Shares into Ordinary Shares which may be sold to other parties. In case of full redemption of Preferred Shares the Company will need to pay redemption proceeds of about HK$143,005,000 which is the total principal amount of all the outstanding Preferred Shares. In addition, Microsoft will not be a strategic shareholder of the Company.

In view of the benefits to be derived from retaining Microsoft as the Company’s strategic shareholder, the Directors (excluding members of the Independent Board Committee, who will give their opinion based on the recommendation from the independent financial adviser) are of the view that the terms of the Supplemental Deed are fair and reasonable and are normal commercial terms and in the interests of the Company and the Shareholders as a whole.

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

In connection with the proposed variation of the terms of the Preferred Shares, a special resolution will be proposed at the EGM to amend the Articles of Association of the Company to give effect to the revised terms of the Preferred Shares pursuant to the Supplemental Deed. Details of the proposed amendments are set out on pages 34 to 38 of this circular.

Since the variation of the terms of the Preferred Shares will adversely affect the rights of Ordinary Shares, approval from holders of the Ordinary Shares will be sought by way of a special resolution to be passed at the separate Class Meeting which will be convened before the EGM.

INFORMATION OF THE GROUP AND MICROSOFT

The Group is an integrated IT services provider with services covering ERP, software and service, embedded solution and software outsourcing services.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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LETTER FROM THE BOARD

IMPLICATIONS UNDER THE LISTING RULES

As at the Latest Practicable Date, Microsoft is the holder of 167,915,735 Preferred Shares which can be converted into 772,335,571 Ordinary Shares (representing about 15.51% of the total voting rights of the Company), Microsoft is a substantial Shareholder and a connected person of the Company and the transactions contemplated under the Supplemental Deed constitute a connected transaction on the part of the Company under the Listing Rules and is subject to the reporting, announcement and independent shareholders’ approval requirements pursuant to Rules 14A.35 of the Listing Rules. Microsoft and its associates will abstain from voting in the EGM to be convened.

None of the Directors have a material interest in the transactions contemplated under the Supplemental Deed or need to abstain from voting on the board resolution approving the Supplemental Deed, the transactions contemplated thereunder and the amendments to the Articles of Association of the Company.

Independent Board Committee comprising the independent non-executive Directors has been formed to advise the Independent Shareholders on the terms of the Supplemental Deed and First Shanghai has been appointed as an independent financial adviser to advise the Independent Board Committee in respect of the terms of the Supplemental Deed.

CLASS MEETING AND EGM

Set out on pages 29 to 33 of this circular is a notice convening the Class Meeting of holders of the Ordinary Shares which will be held at Flats B & C, 30/F, Tower A, Billion Centre, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong at 10:00 a.m. on 6 December 2011, Tuesday at which a special resolution will be proposed to approve (i) the Supplemental Deed and the transactions contemplated thereunder; and (ii) the amendments to the Articles of Association of the Company.

Set out on pages 34 to 38 of this circular is a notice convening the EGM which will be held at Flats B & C, 30/F, Tower A, Billion Centre, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong at 10:30 a.m. on 6 December 2011, Tuesday at which resolutions will be proposed to approve (i) the Supplemental Deed and the transactions contemplated thereunder; and (ii) the amendments to the Articles of Association of the Company and adoption of the amended and restated memorandum and articles of association of the Company to consolidated all prior changes and new changes to the Memorandum and Articles of Association of the Company.

The Supplemental Deed and the transactions contemplated thereunder and the consequential amendments to the Articles of Association of the Company are subject to, among other things, the approval by the Independent Shareholders and the Shareholders (as the case may be) at the EGM to be taken by way of a poll. Microsoft and its associates shall abstain from voting for the relevant resolutions approving (i) the Supplemental Deed and the transactions contemplated thereunder; and (ii) amendments to the Memorandum and Articles of Association, at the EGM due to their interest in the concerned transaction. Other than the above, no other Shareholders have material interest in the above transactions and will abstain from voting at the EGM. As at the Latest Practicable Date, Microsoft (including its associates) is the holder of the Preferred Shares which can be converted into 772,335,571 Ordinary Shares (representing about 15.51% of the total voting rights of the Company).

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LETTER FROM THE BOARD

Microsoft (including its associates) controls or is entitled to control over the entire voting right in respect of its Preferred Shares. There is (i) no voting trust or other agreement or arrangement or understanding entered into by or binding upon Microsoft (including its associates); and (ii) no obligation or entitlement of Microsoft (including its associates) as at the Latest Practicable Date, whereby it has or may have temporarily or permanently passed control over the exercise of the voting right in respect of its Preferred Shares to a third party, either generally or on a case-by-case basis.

Forms of proxy for the EGM and for the Class Meeting are enclosed. Whether or not you wish to attend the EGM or the Class Meeting, you are requested to complete the form of proxy and return the same to the office of the Company’s branch share registrar and transfer office in Hong Kong, Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time appointed for the respective meeting (or any adjourned meeting). Completion and delivery of the form of proxy will not preclude you from attending and voting at the meeting (or any adjourned meeting) if you so wish.

RECOMMENDATIONS

The Independent Board Committee has been established to advise the Independent Shareholders whether the terms of the Supplemental Deed are fair and reasonable so far as they are concerned.

First Shanghai has been appointed to advise the Independent Board Committee and the Independent Shareholders in that connection.

The text of the letters from First Shanghai containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 15 to 21 of this circular and the text of the letter from the Independent Board Committee to the Independent Shareholders is set out on page 14 of this circular.

The Independent Board Committee, having taken into account the advice of First Shanghai, is of the opinion that the Supplemental Deed to be entered into is upon normal commercial terms, and the connected transactions contemplated thereunder to be entered into are in the ordinary and usual course of business of the Group and they are fair and reasonable and in the interests of the Company and the Shareholders as whole and recommends the Independent Shareholders to vote in favour of all the resolutions to be proposed at EGM.

The Board considers that the transactions contemplated under the Supplemental Deed and the consequential amendments to the Memorandum and the Articles of Association of the Company are both in the interests of the Company and the Shareholders as a whole and recommends the Independent Shareholders to vote in favour of all the resolutions to be proposed at EGM and the holders of Ordinary Shares to vote in favour of the resolution to be proposed at the Class Meeting.

— 12 —

LETTER FROM THE BOARD

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully For and on behalf of the Board of Inspur International Limited Mr. Sun Pishu Chairman

— 13 —

LETTER OF ADVICE FROM THE INDEPENDENT BOARD COMMITTEE

INSPUR INTERNATIONAL LIMITED 浪潮國際有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 596)

14 November 2011

To the Independent Shareholders (excluding Microsoft and its associates)

Dear Sir or Madam,

VARIATION OF THE TERMS OF PREFERRED SHARES

We refer to the circular dated 14 November 2011 issued by the Company (the “Circular”), of which this letter forms part. Terms used in this letter shall bear the same meanings as given to them in the Circular unless the context otherwise requires.

We have been appointed as members of the Independent Board Committee to consider the Supplemental Deed and to advise the Independent Shareholders as to the fairness and reasonableness of the aforesaid matters, and to recommend how the Independent Shareholders should vote at the EGM. First Shanghai has been appointed to advise the Independent Board Committee and the Independent Shareholders in this regard.

We wish to draw your attention to the letter from the Board, as set out on pages 4 to 13 of the Circular, and the letter from First Shanghai to the Independent Board Committee and the Independent Shareholders which contains its advice to us in respect of the Supplemental Deed, as set out on pages 15 to 21 of the Circular.

Having taken into account of the advice of First Shanghai, we consider that the Supplemental Deed to be entered into is upon normal commercial terms, and the connected transactions contemplated thereunder to be entered into are in the ordinary and usual course of business of the Group and they are fair and reasonable and in the interests of the Company and the Shareholders as whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions to be proposed at the EGM to approve the Supplement Deed and the transactions contemplated thereunder and the amendments to the Memorandum and the Articles of Association of the Company.

Yours faithfully,

the Independent Board Committee Meng Xiang Xu Zhang Tiqin Wong Lit Chor, Alexis Independent non-executive Independent non-executive Independent non-executive Director Director Director

— 14 —

LETTER OF ADVICE 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 for incorporation into this circular.

==> picture [117 x 50] intentionally omitted <==

FIRST SHANGHAI CAPITAL LIMITED

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

14 November 2011

To the Independent Board Committee and the Independent Shareholders

Dear Sirs or Madams,

VARIATION OF THE TERMS OF PREFERRED SHARES

INTRODUCTION

We refer to our engagement as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Supplemental Deed. Details of the terms of the Supplemental Deed are set out in the circular of the Company dated 14 November 2011 (the “ Circular ”), of which this letter forms part. Unless the context otherwise requires, terms used in this letter shall have the same meanings as those defined in the Circular.

On 31 October 2011, the Company, as the issuer, and Microsoft, as the subscriber, entered into the Supplemental Deed to vary the terms of Preferred Shares with the effect that, amongst others, the maturity of the Preferred Shares will be extended for further two years subject to fulfilment of certain conditions so as to retain Microsoft as the strategic shareholder of the Company.

Microsoft is currently entitled to exercise approximately 15.51% of the total voting rights of the Company, therefore Microsoft is a substantial shareholder and a connected person of the Company. Hence, the transactions contemplated under the Supplemental Deed constitute connected transactions of the Company and are subject to, amongst others, approval from the Independent Shareholders under Chapter 14A of the Listing Rules.

The Independent Board Committee, comprising all the independent non-executive Directors, namely, Mr. Meng Xiang Xu, Mr. Zhang Ti Qin and Mr. Wong Lit Chor, Alexis, has been established to advise the Independent Shareholders in respect of the Supplemental Deed. We, First Shanghai Capital Limited, have been appointed as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in this regard.

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LETTER OF ADVICE FROM FIRST SHANGHAI

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 management of the Group, and have assumed that all such information and representations made or referred to in the Circular and provided to us by the management of the Group were true at the time they were made and continue to be true up to the date of the Circular. We have also assumed that all statements of belief, opinion and intention made in the 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 the management of the Group and have been advised 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 management of the Group nor have we conducted any form of investigation into the business, affairs or future prospects of the Group or Microsoft.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our opinion and recommendations, we have taken into account the following principal factors and reasons:

1. Background to and reasons for the entering into of the Supplemental Deed

The Group is an integrated information technology services provider with services covering taxation, finance, ERP, telecommunication, e-government sectors and software outsourcing services. According to the interim report of the Company for the six months ended 30 June 2011 (the “ 2011 Interim Report ”), the Group focused on the provision of services and successfully developed high-end customer base and the Group increased investments in the research and development of cloud computing, logistic network and other new technologies and launched new series of products using cloud computing technology, which further enhanced the core competitiveness of the Group.

Microsoft is principally engaged in developing, licensing and supporting a wide range of software products and services for various types of computing devices with offices in more than 100 countries and the common stocks of Microsoft are traded on the NASDAQ Stock Market. According to the quarterly report of Microsoft for the three months ended 30 September 2011, Microsoft is devoting significant resources to consumer cloud offerings like Bing, Windows Live, and Xbox LIVE and to develop cloud infrastructure, platforms, and applications including offerings such as Microsoft Dynamics Online, Microsoft SQL Azure, Office 365, Windows Azure, Windows Intune, and Windows Server.

We understand that cloud-computing is one of the major focuses of the future business development of both the Group and Microsoft. We also understand that the Group has been strategically maintaining a long term cooperation relationship with Microsoft to expand the business of the Group. In particular, in order to expand its software outsourcing businesses, we are advised that the Group has been cooperating with diverse divisions and product units in Microsoft including those related to cloud computing, Windows products and genuine software.

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LETTER OF ADVICE FROM FIRST SHANGHAI

The Company and Microsoft entered into the Subscription Deed dated 26 August 2005, which is related to the subscription of the Preferred Shares by Microsoft and is supplemented by three supplemental deeds dated 7 September 2005, 13 September 2005 and 24 September 2009. Microsoft, being the holder the Preferred Shares, which can currently be converted into 772,335,571 Ordinary Shares, is a strategic shareholder of the Company. Nonetheless, the Preferred Shares will be matured on 8 December 2011. Hence, the Group entered into the Supplemental Deed with Microsoft to, amongst others, extend the maturity of the Preferred Shares for further two years to retain Microsoft as a strategic shareholder of the Company, which can improve the industry reputation of the Group and enhance the strategic business relationship between the Group and Microsoft at the same time.

Despite the entering into of the Supplemental Deed is not in the ordinary and usual course of business, having considered, in particular, (i) the principal businesses of the Group and Microsoft; (ii) the strategic business relationship between the Group and Microsoft, which is a globally renowned corporation; (iii) the Group can extend the redemption for the Preferred Shares, which can preserve the working capital of the Group; and (iv) the terms of the Supplemental Deed are fair and reasonable as discussed below, we are of the view that the entering into of the Supplemental Deed is in the interests of the Company and the Shareholders as a whole.

2. Principal terms of the Supplemental Deed

We are advised that the amended terms of the Preferred Shares pursuant to the Supplemental Deed were arrived at after arm’s length negotiation between the Group and Microsoft and the rate of dividend on the Preferred Shares had made reference to, amongst others, the prevailing lending rate in the PRC. Pursuant to the Supplemental Deed, the terms of the Preferred Shares will be amended in the following major aspects:

• (a) the maturity date of the Preferred Shares will be extended for a further period of two years commencing on 8 December 2011 (being the maturity date of the Preferred Shares under the Subscription Deed prior to its amendment pursuant to the Supplemental Deed, the “ Original Maturity Date ”);

• (b) the rate of dividend payable to holder of Preferred Shares will be increased from 6% per annum (calculated on the outstanding principal amount of the Preferred Shares) to 9% per annum;

• (c) the dividend will be payable to holder of Preferred Shares in form of cash only, and scrip dividend is no longer available after the Original Maturity Date; and

• (d) when the dividend payable to holders of Ordinary Shares exceeds HK$0.013 (the “ Current Average per Share Dividend ”) per Ordinary Shares in a financial year, the Company will pay the holder of Preferred Shares the excess dividend (which is equal to Excess Dividend x Number of Ordinary Shares which can be converted from the Preferred Shares where Excess Dividend = Dividend per Ordinary Share payable in a financial year � Current Average per Share Dividend).

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LETTER OF ADVICE FROM FIRST SHANGHAI

As detailed in the letter from the Board, Microsoft delivered a conversion notice for 83,174,600 Preferred Shares to the Company on 31 October 2011 to facilitate the disposal of 415,873,000 Ordinary Shares to an independent third party purchaser, which was already completed on 7 November 2011. As advised by the Company, the principal amount of the Preferred Shares are approximately HK$206,217,394 before conversion and approximately HK$143,004,698 after conversion. For more details on each of the principal amount and conversion price of the Preferred Shares, please refer to the letter from the Board. Further, under the Supplemental Deed, Microsoft has agreed to deliver a notice to the Company to require the Company to redeem 95,056,686 Preferred Shares on the Original Maturity Date (the “ Redemption ”). Hence, we understand that Microsoft will be the holder of 72,859,049 Preferred Shares (the “ Remaining Preferred Shares ”) which can be converted into 297,052,141 Ordinary Shares (representing approximately 6.59% of the total voting rights of the Company if there is no other change to the share capital of the Company) on the Original Maturity Date upon completion of the Redemption.

In respect of the extension of the maturity date of the Preferred Shares for a further period of two years commencing on the Original Maturity Date, we understand that the extension allows the Group to postpone the redemption for the Preferred Shares and therefore preserve the working capital of the Group for business development purposes. The extension can also retain Microsoft as a strategic shareholder of the Company and the Group can enjoy the benefits as discussed in the section headed “Background to and reasons for the entering into of the Supplemental Deed” above. Therefore, we are of the view that the extension is acceptable.

In respect of the increase in the rate of dividend payable to Microsoft from 6% per annum to 9% per annum, we note that the prevailing one-to-three-year benchmark RMB lending rate published by the People’s Bank of China (the “ PBOC ”) is 6.65% per annum and the prevailing HK$ best lending rate quoted by The Hong Kong and Shanghai Banking Corporation is 5.00% per annum. Based on our review of the information on the website of the PBOC, we note that (i) the RMB benchmark lending rates of financial institutions has been rising; and (ii) the required reserve ratio of financial institutions in the PRC has also been increasing in the past several years, where financial institutions may have to reduce their lending capacity to preserve capital to meet the increased requirement, therefore corporations in the PRC may not be able to obtain financing at desirable rates. In addition, despite the rate of dividend is above the benchmarks, we are advised that the amount of dividend on the Remaining Preferred Shares of approximately HK$5.7 million per year, which is derived from multiplying the total principal amount of the Remaining Preferred Shares of approximately HK$63,518,905 by the dividend rate of 9% per annum, represents only approximately 0.44% of the total bank balances and cash and represents only approximately 0.33% of the net assets of the Group as at 30 June 2011. Therefore, after collectively taking into account, in particular, (i) the rate of dividend payable to Microsoft is 2.25% above the prevailing one-to-three-year benchmark RMB lending rate published by the PBOC; (ii) the RMB benchmark lending rates of financial institutions has been rising recently; (iii) corporations in the PRC may not be able to obtain financing at desirable rates under the current financial environment in the PRC; (iv) the retaining of Microsoft, which is a globally renowned corporation, as a strategic shareholder of the Company can improve the industry reputation of the Group; (v) the continuation of long term strategic business relationship between the Group and Microsoft is expected to enhance the business development of the Group in the upcoming

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LETTER OF ADVICE FROM FIRST SHANGHAI

years; (vi) the extension of the redemption for the Preferred Shares can preserve the working capital of the Group; and (vii) the amount of dividend represents only approximately 0.44% of the total bank balances and cash as at 30 June 2011 and is not expected to have a material adverse impact on the cash position of the Group, we are of the view that the proposed rate of dividend is acceptable.

In respect of the dividend on the Preferred Shares will be in form of cash rather than scrip dividend, after taking into account, in particular, (i) the amount of dividend represents only approximately 0.44% of the total bank balances and cash as at 30 June 2011 and is not expected to have a material adverse impact on the cash position of the Group; (ii) the issue of further scrip dividend in the form of additional Preferred Shares will increase the aggregate amount of dividend payable to Microsoft; and (iii) the issue of further scrip dividend will dilute the shareholding of the Independent Shareholders, we consider the payment of the dividend in the form of cash is acceptable.

In respect of the payment of excess dividend to Microsoft, we note that the Current Average per Share Dividend is derived from the average of the dividend declared by the Company for each of the three preceding financial years, which decreased from HK$0.02 per Ordinary Share for the year ended 31 December 2008 to HK$0.01 per Ordinary Share for each of the years ended 31 December 2009 and 2010. We are advised that the dividends on the Preferred Shares were in preference to any dividend on the Ordinary Shares, therefore Microsoft, as the holder of the Preferred Share and the important strategic business partner to assist the business development of the Group, was not entitled to any dividend on the Ordinary Shares. Hence, in light of the contribution by Microsoft in the strategic business development of the Group, we are of the view that the payment of dividend in excess of the Current Average per Share Dividend, which is higher than the dividend declared by the Company for each of the two preceding financial years, is acceptable.

Having considered, in particular, (i) the terms of the Supplemental Deed were arrived at after arm’s length negotiation between the Group and Microsoft; (ii) the extension of the maturity date of the Preferred Shares allows the Group to postpone the redemption for the Preferred Shares and therefore preserve the working capital of the Group for business development purposes; (iii) the extension can retain Microsoft as a strategic shareholder of the Company and the Group can enjoy the benefits as discussed in the section headed “Background to and reasons for the entering into of the Supplemental Deed” above; (iv) despite the rate of dividend is above the benchmarks, the actual amount of dividend on the Remaining Preferred Shares is insignificant to the total bank balances and cash of the Group; (v) Microsoft, as the holder of the Preferred Share and the important strategic business partner of the Group, was previously not entitled to any dividend on the Ordinary Shares; and (vi) the Current Average per Share Dividend, which is the benchmark to calculate the excess dividend, is higher than the dividend declared by the Company for the two preceding financial years, we concur with the view of the Directors that the terms of the Supplemental Deed are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned.

3. Possible effects of the Supplemental Deed

The extension of the maturity date of the Preferred Shares for a further period of two years allows the Group to postpone the redemption for the Preferred Shares and therefore preserve the working capital of the Group for business development purposes. Given the amount of dividend on the Remaining Preferred Shares is only approximately HK$5.7 million per year, which represents (i)

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LETTER OF ADVICE FROM FIRST SHANGHAI

approximately 0.44% of the total bank balances and cash of the Group as at 30 June 2011; and (ii) approximately 0.33% of the net assets of the Group as at 30 June 2011, we understand that the cash payments of dividends would not have any material adverse impact to the financial position of the Group. On the other hand, we are advised that, according to the accounting policy of the Group, the dividend on the Preferred Shares will be accounted for as interest expense in the income statement of the Group. Having principally taken into account that the amount of dividend on the Remaining Preferred Shares of approximately HK$5.7 million per year represented only approximately 0.24% of the revenue of the Group for the year ended 31 December 2010, we understand that the cash payments of dividends would not have any material adverse impact to the income statement of the Group.

The following table illustrates (i) the existing shareholding structure as at the Latest Practicable Date; and (ii) the shareholding structure immediately upon the completion of the Redemption, on the assumption of no other change to the share capital of the Company.

Shareholders Ordinary Shares Inspur Group Public Shareholders Sub-total Preferred Shares Microsoft Sub-total Grand total	As at the Latest Practicable Date Number of shares Voting rights (Shares) % of total voting rights 1,354,390,000 1,354,390,000 27.20 2,853,050,291 2,853,050,291 57.29 4,207,440,291 4,207,440,291 84.49 167,915,735 772,335,571 15.51 167,915,735 772,335,571 15.51 4,979,775,862 100.00	Upon the completion of the Redemption Number of shares Voting rights (Shares) % of total voting rights 1,354,390,000 1,354,390,000 30.07 2,853,050,291 2,853,050,291 63.34 4,207,440,291 4,207,440,291 93.41 72,859,049 297,052,141 6.59 72,859,049 297,052,141 6.59 4,504,492,432 100.00	Upon the completion of the Redemption Number of shares Voting rights (Shares) % of total voting rights 1,354,390,000 1,354,390,000 30.07 2,853,050,291 2,853,050,291 63.34 4,207,440,291 4,207,440,291 93.41 72,859,049 297,052,141 6.59 72,859,049 297,052,141 6.59 4,504,492,432 100.00
			93.41
			6.59
			6.59
			100.00

Note: As at the Latest Practicable Date, there are 80,100,000 outstanding Share Options which entitle the holders to subscribe for 80,100,000 Ordinary Shares; The above table is prepared on the assumption that no Share Option is exercised into Ordinary Shares.

We note from the above table that, immediately upon the completion of the Redemption, the voting rights of Microsoft would decrease from approximately 15.51% to approximately 6.59%, whereas the voting rights of the public Shareholders would increase from approximately 57.29% to 63.34%. We understand that the entering into of the Supplemental Deed would not dilute the shareholding interests of the existing Independent Shareholders.

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LETTER OF ADVICE FROM FIRST SHANGHAI

RECOMMENDATION

Having considered the above principal factors and reasons, despite the entering into of the Supplemental Deed is not in the ordinary and usual course of business, we are of the opinion that the entering into of the Supplemental Deed is in the interests of the Company and the Shareholders as a whole. We also consider the terms of the Supplemental Deed are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned. Accordingly, we advise the Independent Board Committee to recommend the Independent Shareholders, and we also recommend the Independent Shareholders, to vote in favour of the resolutions to approve the Supplemental Deed, including the relevant proposed amendments to the memorandum and articles of association of the Company, at the EGM and the Class Meeting.

Yours faithfully, For and on behalf of

First Shanghai Capital Limited

Eric Lee Managing Director

Fanny Lee Managing Director

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

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

2. DISCLOSURE OF INTERESTS

(a) Interests and short positions of the Directors and the chief executive of the Company in the securities of the Company and its associated corporations

As at the Latest Practicable Date, the interests and short positions of the Directors and the chief executive of the Company in the Shares, underlying Shares or debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required (a) to be notified to the Company 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 (b) pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (c) to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies (the “Model Code”) contained in the Listing Rules, were as follows:

(i) Long positions in Shares

				Percentage of
				issued share
				capital of the
**Name **	of Director	Type of interests	Number of Shares	Company
Dong	Hailong	Beneficial owner	5,000	0.00%

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GENERAL INFORMATION

APPENDIX

• (ii) Long positions in underlying Shares of the Company

				Percentage
				of the issued
		Description	Number of	share capital
		of equity	underlying	of the
Name of Director	Type of interests	derivatives	Shares	Company
Sun Pishu	Beneficial owner	share option	20,000,000	0.48%
		(Note 1)
Wang Xingshan	Beneficial owner	share option	5,000,000	0.12%
		(Note 2)
Chen Dongfeng	Beneficial owner	share option	4,000,000	0.10%
		(Note 2)
Dong Hailong	Beneficial owner	share option	2,000,000	0.05%
		(Note 2)
Meng Xiang Xu	Beneficial owner	share option	200,000	0.01%
		(Note 2)
Wong Lit Chor, Alexis	Beneficial owner	share option	200,000	0.01%
		(Note 2)

• Note 1: The share options were granted under the pre-IPO share option scheme adopted by the Company on 8 April 2004 at a subscription price of HK$0.0648 per Share. Up to the Latest Practicable Date, none of the above share options had been exercised.

Note 2: The share options were granted on 10 December 2010 under the 2008 share option scheme adopted by the Company on 10 November 2008 at a subscription price of HK$0.682 per Share. Up to the Latest Practicable Date, none of the above share options had been exercised.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors and the chief executive of the Company had or was deemed to have any interests or short positions in the Shares, underlying Shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were required (a) to be notified to the Company 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 (b) pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (c) to be notified to the Company and the Stock Exchange pursuant to the Model Code.

(b) Persons who have an interest or short position which is discloseable under Divisions 2 and 3 of Part XV of the SFO and substantial Shareholders

So far as is known to the Directors and the chief executive, as at the Latest Practicable Date, the following person (not being Director or chief executive of the Company) had, or was deemed to have, interests or short positions in the Shares or underlying Shares which would fall to be disclosed to the

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GENERAL INFORMATION

APPENDIX

Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or who were directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any member of the Group:

Long positions in Shares

			Approximate
		Number of	percentage of
Name of Shareholders	Type of interests	Shares	interests
Inspur Group Limited	Interest in a controlled	1,354,390,000	32.19%
	corporation (Note 1)
Inspur Electronics (HK) Limited	Beneficial owner	1,354,390,000	32.19%
	(Note 1)
Cong Haipeng	Interest in a controlled	415,873,000	9.88%
	corporation (Note 3)
Starry Castle Limited	Beneficial owner	415,873,000	9.88%
	(Note 3)

• Note 1: Inspur Group Limited is taken to be interested in 1,354,390,000 Shares because it is being 100% shareholder in the issued share capital of Inspur Electronics (HK) Limited.

• Note 2: Mr. Sun Pishu, who is a director of the Company, is also a director of Inspur Group Limited and a director of Inspur Electronics (HK) Limited.

Note 3: The controlled corporation referred to above is Starry Castle Limited.

Long positions in series A senior redeemable convertible voting preferred shares of the Company

			Number of	Approximate
		Number of	underlying	percentage of
		Preferred	Ordinary	voting rights
Name of Shareholders	Type of interests	Shares	Shares	of Shares
			(Note 1)
Microsoft Corporation	Beneficial owner	167,915,735	772,335,571	15.51%

Note 1: Microsoft Corporation held 167,915,735 class A senior redeemable voting preferred shares convertible into 772,335,571 Ordinary Shares. Microsoft Corporation has agreed that in the event that it becomes entitled to exercise or control the exercise of more than 28% of the voting rights at general meetings of the Company (other than meeting of the holder(s) of Preferred Shares), it shall not and shall procure its nominee(s) not to exercise such portion of the voting rights attaching to the Preferred Shares and/or Ordinary Shares in excess of 28% of the total voting rights at any general meeting of the Company. At the Latest Practicable Date, the above 772,335,571 underlying Ordinary Shares represented approximately 15.51% of the issued share capital of the Company as enlarged by the full exercise of the conversation rights attaching to the Preferred Shares.

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GENERAL INFORMATION

APPENDIX

Long positions in members of the Group

			Approximate
			percentage of
			shareholding
			in the
			members of
Name of shareholders	Types of Interest	Equity interest held	the Group
Wu Xi Yi Jie Xin Cheng	Beneficial owner	RMB200,000 in the registered	10%
Information Technology		capital of Wuxi Inspur
Company Limtied#		Business Technology
(無錫易捷信誠信息		Company Limited#
技術有限公司)		(無錫浪潮商服技術有限公司)
Fang Wensheng	Beneficial owner	RMB225,000 in the registered	37.5%
		capital of Inspur Fangzhi
Bao Jianhua	Beneficial owner	RMB90,000 in the registered	15%
		capital of Inspur Fangzhi
Shanghai Huili Co. Ltd.#	Beneficial owner	RMB50,000 in the registered	10%
(上海滙力有限公司)		capital of Shanghai Guoqiang
		Genersoft Incorporation#
		(上海國强通用軟件有限公司)
Webgroup Co.	Beneficial owner	US$14,504 in the registered	10.36%
		capital of Langchao Gaoyou
		(Shanghai) Services
		Incorporation#
		高優(上海)信息科技有限公司
Shen Zhen Liang Long	Beneficial owner	RMB150,000 in registered	30%
Management & Consulting		capital of Shangdong Inspur
Company Limited#		Financial Information Systems
(深圳量龍管理諮詢		Company Limited#
有限公司)		(山東浪潮金融信息系統有限公司)

English names are for identification purpose only

Save as disclosed above, as at the Latest Practicable Date, the Directors were not aware of any other person (other than the Directors and the chief executive of the Company) who had, or was deemed to have, interests or short positions in the Shares or underlying Shares (including any interests in options in respect of such capital), which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was expected, directly or indirectly, to be interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any member of the Group.

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GENERAL INFORMATION

APPENDIX

3. DIRECTORS’ OTHER INTEREST

As at the Latest Practicable Date, so far as the Directors are aware of, none of themselves or their respective associates had any interest in a business which competes or may compete with the business of the Group or any other conflicts of interest with the Group.

As at the Latest Practicable Date, none of the Directors has any interest, either direct or indirect, in any assets which have 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 since 31 December 2010, being the date to which the latest published audited financial statements of the Company were made up.

There is no contract or arrangement entered into by any member of the Group subsisting at the Latest Practicable Date in which any Director is materially interested and which is significant to the business of the Group.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contracts with the Group (excluding contracts expiring or terminable by the employer within one year without payment of compensation other than statutory compensation).

5. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2010, being the date to which the latest audited financial statements of the Company were made up.

6. EXPERT

First Shanghai has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its letter and/or references to its name in the form and context in which they appear.

The following is the qualification of the expert who has provided its advice, which are contained in this circular:

Qualification

Name Qualification First Shanghai A licensed corporation to carry out type 6 (advising on corporate finance) of the regulated activity under the SFO

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APPENDIX

GENERAL INFORMATION

As at the Latest Practicable Date, First Shanghai was not beneficially interested in the share capital of any member of the Group nor did it have any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for any Shares, convertible securities, warrants, options or derivatives which carry voting rights in any member of the Group nor did it have any interest, either direct or indirect, in any assets which have been, since the date to which the latest published audited financial statements of the Company were made up (i.e. 31 December 2010), 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.

7. MISCELLANEOUS

• (a) The registered office of the Company is at Century Yard, Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111, Cayman Islands, and the head office and principal place of business in Hong Kong of which is at Flats B & C, 30/F, Tower A, Billon Centre, 1 Wang Kwong Road, Kowloon Bay, Kowloon.

• (b) The principal share registrar and transfer office of the Company is Butterfield Fulcrum Group (Cayman) Limited at Butterfield House, 68 Fort Street, P.O. Box 609, George Town, Grand Cayman KY1-1107, Cayman Islands and the Hong Kong branch share registrar and transfer office of which is Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

• (c) The company joint secretaries of the Company are: Ms. Chan Wing who is an associate member of the Hong Kong Institute of Certified Public Accountants; and Mr. Zou Bo who is a non-practising member of the Chinese Institute of Certified Public Accountants and a member of the China Certified Tax Agents Association.

• (d) The English text of this circular and the accompanying form of proxy shall prevail over their respective Chinese texts in case of inconsistency.

8. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection during normal business hours at the Company’s principal place of business in Hong Kong from the date of this circular up to and including the date of the EGM:

• (i) memorandum and articles of association of the Company;

• (ii) the letter of recommendation from the Independent Board Committee to the Independent Shareholders, the text of which is set out on page 14 of this circular;

• (iii) 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 15 to 21 of this circular;

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GENERAL INFORMATION

APPENDIX

• (iv) the written consent from First Shanghai as referred to in the paragraph headed “Expert” in this Appendix;

• (v) Subscription Deed; and

• (vi) Supplemental Deed.

— 28 —

NOTICE OF THE CLASS MEETING

INSPUR INTERNATIONAL LIMITED 浪潮國際有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 596)

NOTICE OF ORDINARY SHARES CLASS MEETING

NOTICE IS HEREBY GIVEN that the class meeting of the Company, of the holders of Ordinary Shares of the Company (the “ Class Meeting ”) of Inspur International Limited (the “ Company ”) will be held at Flats B & C , 30/F., Tower A, Billion Center, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong, on 6 December 2011, Tuesday at 10:00 a.m. for the purpose of considering and, if thought fit, passing, with or without modifications, the following resolution as a special resolution of the holders of Ordinary Shares of the Company:

SPECIAL RESOLUTION

“THAT :

• (i) the supplemental deed (“ Supplemental Deed ”) dated 31 October 2011 between the Company (as the issuer) and Microsoft Corporation (“ Microsoft ”) (as the subscriber) to supplement the subscription deed (“ Subscription Deed ”) dated 26 August 2005 between the Company and Microsoft (as already supplemented by three supplemental deeds dated 7 September 2005, 13 September 2005 and 24 September 2009, respectively, between the same parties) in relation to the preferred shares issued to and held by Microsoft (or its nominee) (“ Preferred Shares ”) and all the transactions contemplated in the Supplemental Deed, including the redemption of certain Preferred Shares and subject to approval by shareholders of the Company by way of a special resolution, the variation of the terms of Preferred Shares in accordance with the amendments to the Articles of Association of the Company set forth in paragraph (iii) below be and are hereby approved, confirmed and ratified by the shareholders of the Company. A copy of the Supplemental Deed has been tabled at the meeting and marked “Exhibit A” and signed by the Chairman of the meeting for the purpose of identification;

• (ii) the directors of the Company, acting together, individually or by committee, be and are hereby authorised to take such actions, do such things and execute such further documents or deeds which in their opinion may be necessary, desirable or expedient for the purpose of giving effect to and/or to implement the transactions contemplated in this resolution;

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NOTICE OF THE CLASS MEETING

• (iii) subject to approval by shareholders of the Company by way of a special resolution, the Articles of Association of the Company be and are hereby amended in the following manner:

• (a) Article 9A(1) — Definition

  • (i) By adding the following definition of “Current Average Per Share Dividend” immediately after the definition of “Conversion Right”:

    • ““ Current Average Per has the meaning ascribed hereto in Article Share Dividend ” 9A(2B)(c);”

  • (ii) By deleting the definition of “Dividend” in its entirety and substituting thereof with the following definition of “Dividend”:

    • ““ Dividend ” in relation to each Preferred Share, (i) from the Issue Date to the Restructuring Date a fixed cumulative preferential cash dividend in US dollars payable thereon to its holder at the rate of 6% per annum on the Principal Amount and (ii) from the Restructuring Date to the Maturity Date, a fixed cumulative preferential cash dividend in US dollars payable thereon to its holder at the rate of 9% per annum on the Principal Amount;”

  • (iii) By adding the following definitions of “Excess Dividend” and “Excess Dividend Amount” immediately after the definition of “Dividend Payment Date”:

    • ““ Excess Dividend ” has the meaning ascribed hereto in Article 9A(2B)(b);

    • “ Excess Dividend Amount ” has the meaning ascribed hereto in Article 9A(2B)(a);”

  • (iv) By deleting the definition of “Maturity Date” in its entirety and substituting thereof with the following definition of “Maturity Date”:

    • ““ Maturity Date ” a day falling on the second anniversary of the Restructuring Date, or if such date is not a Business Day, the Business Day immediately following such date;”

  • (v) By adding the following definition of “Restructuring Date” immediately after the definition of “Redemption Date”:

    • ““ Restructuring Date ” December 8, 2011;”

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NOTICE OF THE CLASS MEETING

(b) Article 9A(2A) — Scrip Dividend

By deleting existing Article 9A(2A)(a) in its entirety and substituting thereof with the following new Article 9A(2A)(a) :

“Subject to Article 9A(2A)(b), the Dividend on all outstanding Preferred Shares (including those to be issued pursuant to this Article 9A(2A)(a) as Scrip Dividend Preferred Shares) for the period commencing from 1 October 2009 up to the Restructuring Date shall, instead of wholly by cash in US$ as provided for in Article 9A(2)(b), be paid and satisfied by the Company on each Dividend Payment Date to the Preferred Shareholders (i) as to one-third (1/3) thereof by cash in US$ as provided for in Article9A(2)(b) and (ii) as to two-thirds (2/3) thereof (“Scrip Dividend”) by the allotment and issue to the Preferred Shareholders (or their nominees) on such Dividend Payment Date of further Preferred Shares in such number to be calculated by dividing (i) the amount of such Scrip Dividend by (ii) the amount of the Scrip Dividend Preferred Shares Issue Price applicable on such Dividend Payment Date (which quotient shall be rounded down to the nearest whole number).”

(c) Article 9A(2B) — Ordinary Share Dividend

By adding the following new Article 9A(2B) immediately after the existing Article 9A(2A):

“(2B) Ordinary Share Dividend

• (a) If the Company pays any Excess Dividend in any financial year, it will simultaneously pay to each Preferred Shareholder an amount equal to the Excess Dividend multiplied by the number of Shares into which such Preferred Share is convertible at the Conversion Price then in effect on the relevant record date for the payment of such Excess Dividend (the “ Excess Dividend Amount ”). The Excess Dividend Amount shall be payable in US$ (calculated based on the exchange rate quoted by The Hongkong and Shanghai Banking Corporation Limited for the purchase of US$ with HK$ by telegraph transfer at 5:00 p.m. on the day immediately preceding the date of the relevant payment).

• (b) “ Excess Dividend” means any cash dividend to holders of Ordinary Shares that, together with all other cash dividends previously paid to holders of Shares in the same financial year, exceeds, on a per Ordinary Share basis, the Current Average Per Share Dividend.

• (c) “ Current Average Per Share Dividend ” means an amount equal to HK$ 0.013 per Ordinary Share.

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NOTICE OF THE CLASS MEETING

• (d) Article 9A(6)(a)(iv)

By deleting existing Article 9A(6)(a)(iv) in its entirety and substituting thereof with the following new Article 9A(6)(a)(iv) :

• “(iv) listing of the Ordinary Shares on the Main Board of The Hong Kong Stock Exchange or on such other Recognized Stock Exchange on which the Ordinary Shares may be listed at the relevant time (as the case may be) are revoked or withdrawn;”

• (e) Article 9A(6)(b)

By deleting existing Article 9A(6)(b) (titled “Special Redemption”) in its entirety.

• (f) Articles 9A(6)(c) and 9A(6)(d)

By renumbering Articles 9A(6)(c) and 9A(6)(d) as Articles 9A(6)(b) and 9A(6)(c) respectively.”

By order of the Board Inspur International Limited Mr. Sun Pishu Chairman

Hong Kong, 14 November 2011

Registered office: Head office and principal place of business Cricket Square in Hong Kong: Hutchins Drive Flats B & C, 30/F. P.O. Box 2681 Tower A, Billion Centre Grand Cayman KY1-1111 1 Wang Kwong Road Cayman Islands Kowloon Bay Kowloon Hong Kong

Notes:

1. A form of proxy for use at the Class Meeting or any adjournment thereof is enclosed.

2. A member entitled to attend and vote at the Class Meeting is entitled to appoint one or more proxy to attend and, subject to the provisions of the articles of association of the Company, to vote on his behalf. A proxy need not be a member of the Company but must be present in person at the Class Meeting to represent the member. If more than one proxy is so appointed, the appointment shall specify the number and class of Shares in respect of which each such proxy is so appointed.

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NOTICE OF THE CLASS MEETING

1. In order to be valid, the form of proxy must be duly completed and signed in accordance with the instructions printed thereon and deposited together with a power of attorney or other authority, if any, under which it is signed, or a certified copy of such power or authority, at the Company’s branch share registrar and transfer office in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for holding the Class Meeting or any adjournment thereof. Completion and return of a form of proxy will not preclude a member from attending in person and voting at the Class Meeting or any adjournment thereof, should he so wish.

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

3. The voting on the resolutions at the Class Meeting will be conducted by way of a poll.

As at the date of this notice, the Board comprised Mr. Sun Pishu, Mr. Wang Xingshan, Mr. Chen Dongfeng and Mr. Dong Hailong as executive Directors, and Mr. Meng Xiang Xu, Mr. Zhang Tiqin and Mr. Wong Lit Chor, Alexis as independent non-executive Directors.

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NOTICE OF THE EGM

INSPUR INTERNATIONAL LIMITED 浪潮國際有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 596)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “ EGM ”) of Inspur International Limited (the “ Company ”) will be held at Flats B& C, 30/F., Tower A, Billion Center, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong, on 6 December 2011, Tuesday at 10:30 a.m. for the purpose of considering and, if thought fit, passing, with or without modifications, the following resolution number 1 (below) as an ordinary resolution and the resolution numbered 2 (below) as a special resolution of the Company:

ORDINARY RESOLUTION

1. “ THAT :

2. (iv) the supplemental deed (“ Supplemental Deed ”) dated 31 October 2011 between the Company (as the issuer) and Microsoft Corporation (“ Microsoft ”) (as the subscriber) to supplement the subscription deed (“ Subscription Deed ”) dated 26 August 2005 between the Company and Microsoft (as already supplemented by three supplemental deeds dated 7 September 2005, 13 September 2005 and 24 September 2009, respectively, between the same parties) in relation to the preferred shares issued to and held by Microsoft (or its nominee) (“ Preferred Shares ”) and all the transactions contemplated in the Supplemental Deed, including the redemption of certain Preferred Shares and subject to the passing of resolution number 2 below, the variation of the terms of the Preferred Shares in accordance with the amendments to the Articles of Association of the Company as set out in resolution number 2 below, be and are hereby approved, confirmed and ratified by the shareholders of the Company. A copy of the Supplemental Deed has been tabled at the meeting and marked “Exhibit A” and signed by the Chairman of the meeting for the purpose of identification; and

3. (v) the directors of the Company, acting together, individually or by committee, be and are hereby authorised to take such actions, do such things and execute such further documents or deeds which in their opinion may be necessary, desirable or expedient for the purpose of giving effect to and/or to implement the transactions contemplated in this resolution.”

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NOTICE OF THE EGM

SPECIAL RESOLUTION

1. “ THAT , subject to the passing of resolution number 1 above:

2. (A) the Articles of Association of the Company be and are hereby amended in the following manner:

   • (g) Article 9A(1) — Definition

     • (i) By adding the following definition of “Current Average Per Share Dividend” immediately after the definition of “Conversion Right”:

       • “ “Current Average Per has the meaning ascribed hereto in Article Share Dividend” 9A(2B)(c);”

     • (ii) By deleting the definition of “Dividend” in its entirety and substituting thereof with the following definition of “Dividend”:

       • “ “Dividend”

in relation to each Preferred Share, (i) from the Issue Date to the Restructuring Date a fixed cumulative preferential cash dividend in US dollars payable thereon to its holder at the rate of 6% per annum on the Principal Amount and (ii) from the Restructuring Date to the Maturity Date, a fixed cumulative preferential cash dividend in US dollars payable thereon to its holder at the rate of 9% per annum on the Principal Amount;”

• (iii) By adding the following definitions of “Excess Dividend” and “Excess Dividend Amount” immediately after the definition of “Dividend Payment Date”:

• “ “Excess Dividend” has the meaning ascribed hereto in Article 9A(2B)(b);

• “Excess Dividend has the meaning ascribed hereto in Article Amount” 9A(2B)(a);”

• (iv) By deleting the definition of “Maturity Date” in its entirety and substituting thereof with the following definition of “Maturity Date”:

• “ “Maturity Date” a day falling on the second anniversary of the Restructuring Date, or if such date is not a Business Day, the Business Day immediately following such date;”

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NOTICE OF THE EGM

• (v) By adding the following definition of “Restructuring Date” immediately after the definition of “Redemption Date”:

  • “ “Restructuring Date” December 8, 2011;”

• (h) Article 9A(2A) — Scrip Dividend

By deleting existing Article 9A(2A)(a) in its entirety and substituting thereof with the following new Article 9A(2A)(a):

“Subject to Article 9A(2A)(b), the Dividend on all outstanding Preferred Shares (including those to be issued pursuant to this Article 9A(2A)(a) as Scrip Dividend Preferred Shares) for the period commencing from 1 October 2009 up to the Restructuring Date shall, instead of wholly by cash in US$ as provided for in Article 9A(2)(b), be paid and satisfied by the Company on each Dividend Payment Date to the Preferred Shareholders (i) as to one-third (1/3) thereof by cash in US$ as provided for in Article9A(2)(b) and (ii) as to two-thirds (2/3) thereof (“Scrip Dividend”) by the allotment and issue to the Preferred Shareholders (or their nominees) on such Dividend Payment Date of further Preferred Shares in such number to be calculated by dividing (i) the amount of such Scrip Dividend by (ii) the amount of the Scrip Dividend Preferred Shares Issue Price applicable on such Dividend Payment Date (which quotient shall be rounded down to the nearest whole number).”

(i) Article 9A(2B) — Ordinary Share Dividend

By adding the following new Article 9A(2B) immediately after the existing Article 9A(2A):

“(2B) Ordinary Share Dividend

• (d) If the Company pays any Excess Dividend in any financial year, it will simultaneously pay to each Preferred Shareholder an amount equal to the Excess Dividend multiplied by the number of Shares into which such Preferred Share is convertible at the Conversion Price then in effect on the relevant record date for the payment of such Excess Dividend (the “ Excess Dividend Amount ”). The Excess Dividend Amount shall be payable in US$ (calculated based on the exchange rate quoted by The Hongkong and Shanghai Banking Corporation Limited for the purchase of US$ with HK$ by telegraph transfer at 5:00 p.m. on the day immediately preceding the date of the relevant payment).

• (e) “ Excess Dividend” means any cash dividend to holders of Ordinary Shares that, together with all other cash dividends previously paid to holders of Shares in the same financial year, exceeds, on a per Ordinary Share basis, the Current Average Per Share Dividend.

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NOTICE OF THE EGM

• (f) “ Current Average Per Share Dividend ” means an amount equal to HK$0.013 per Ordinary Share.

• (j) Article 9A(6)(a)(iv)

By deleting existing Article 9A(6)(a)(iv) in its entirety and substituting thereof with the following new Article 9A(6)(a)(iv):

• “(iv) listing of the Ordinary Shares on the Main Board of The Hong Kong Stock Exchange or on such other Recognized Stock Exchange on which the Ordinary Shares may be listed at the relevant time (as the case may be) are revoked or withdrawn;”

• (k) Article 9A(6)(b)

By deleting existing Article 9A(6)(b) (titled “Special Redemption”) in its entirety.

• (l) Articles 9A(6)(c) and 9A(6)(d)

By renumbering Articles 9A(6)(c) and 9A(6)(d) as Articles 9A(6)(b) and 9A(6)(c) respectively.

• (B) the new restated Memorandum and Articles of Association (a copy of which has been tabled at the meeting and marked “Exhibit B” and signed by the Chairman of the meeting for the purpose of identification), consolidating all of the proposed amendments referred to in paragraph 2(A) above and all previous amendments made in compliance with applicable laws be and are hereby adopted as the Memorandum and Articles of Association of the Company with immediate effect in replacement of the existing Memorandum and Articles of Association.”

By order of the Board Inspur International Limited Mr. Sun Pishu Chairman

Hong Kong, 14 November 2011

Registered office:

Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Head office and principal place of business in Hong Kong: Flats B & C, 30/F. Tower A, Billion Centre 1 Wang Kwong Road Kowloon Bay Kowloon Hong Kong

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NOTICE OF THE EGM

Notes:

1. A form of proxy for use at the EGM or any adjournment thereof is enclosed.

2. A member entitled to attend and vote at the EGM is entitled to appoint one or more proxy to attend and, subject to the provisions of the articles of association of the Company, to vote on his behalf. A proxy need not be a member of the Company but must be present in person at the EGM to represent the member. If more than one proxy is so appointed, the appointment shall specify the number and class of Shares in respect of which each such proxy is so appointed.

3. In order to be valid, the form of proxy must be duly completed and signed in accordance with the instructions printed thereon and deposited together with a power of attorney or other authority, if any, under which it is signed, or a certified copy of such power or authority, at the Company’s branch share registrar and transfer office in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for holding the EGM or any adjournment thereof. Completion and return of a form of proxy will not preclude a member from attending in person and voting at the EGM or any adjournment thereof, should he so wish.

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

5. The voting on the resolutions at the EGM will be conducted by way of a poll.

As at the date of this notice, the Board comprised Mr. Sun Pishu, Mr. Wang Xingshan, Mr. Chen Dongfeng and Mr. Dong Hailong as executive Directors, and Mr. Meng Xiang Xu, Mr. Zhang Tiqin and Mr. Wong Lit Chor, Alexis as independent non-executive Directors.

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