Leadway Technology Investment Group Limited — Proxy Solicitation & Information Statement 2005

May 4, 2005

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this document or as to the action you should take, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold all your shares in TIANJIN DEVELOPMENT HOLDINGS LIMITED (the ‘‘Company’’), you should at once hand this document and the accompanying form of proxy to the purchaser or the bank or stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

The Stock Exchange of Hong Kong Limited (the ‘‘Stock Exchange’’) takes no responsibility for the contents of this document, 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 document.

This document includes particulars given in compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this document and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.

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(Incorporated in Hong Kong SAR with limited liability under the Companies Ordinance)

(Stock Code: 882)

Executive Directors:

Mr. Wang Guanghao (Chairman)

Dr. Ren Xuefeng (Vice Chairman) Mr. Yu Rumin (Vice Chairman)

Dr. Zhang Hongru Mr. Nie Jiansheng Dr. Wang Jiandong Mr. He Xiuheng Mr. Yang Liheng Mr. Sun Zengyin Dr. Pang Jinhua

Registered Office: 26–38/F Tianjin Building 167 Connaught Road West Hong Kong

Non-executive Directors:

Mr. Ye Disheng Mr. Kwong Che Keung, Gordon* Mr. Cheung Wing Yui

Mr. Lau Wai Kit*

• Dr. Cheng Hon Kwan*

• (* Independent Non-executive Directors)

29th April, 2005

To the shareholders,

Dear Sir or Madam,

PROPOSED GENERAL MANDATES TO REPURCHASE AND ISSUE SHARES AND RE-ELECTION OF DIRECTORS

INTRODUCTION

At the annual general meeting of Tianjin Development Holdings Limited (the ‘‘Company’’) held on 28th May, 2004, the Company granted a general mandate to the directors of the Company (the ‘‘Directors’’) to exercise the powers of the Company to repurchase shares of the Company. A

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separate mandate was also granted to the Directors enabling them to issue new shares. Such mandates will lapse at the conclusion of the forthcoming annual general meeting of the Company which is to be held at 38/F., Function Room, Tianjin Building, 167 Connaught Road West, Hong Kong on 27th May, 2005 at 3: 00 p.m. (‘‘AGM’’). It is therefore proposed to renew these general mandates at the AGM.

The purpose of this document is to provide you with information regarding the above proposed general mandates to repurchase shares and issue shares and to seek the approval of members for the resolutions relating to the aforesaid matters at the AGM.

GENERAL MANDATE TO REPURCHASE SHARES

An ordinary resolution will be proposed at the AGM to give a general and unconditional mandate to the Directors to exercise the powers of the Company to repurchase its own shares at any time until the first to occur of the conclusion of the next annual general meeting or the expiration of the period within which the next annual general meeting of the Company is required by the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) or the Articles of Association of the Company or other applicable laws of Hong Kong to be held or until the mandate is revoked or varied by an ordinary resolution of the shareholders in general meeting of the Company (the ‘‘Repurchase Mandate’’). The shares of the Company which may be repurchased pursuant to the Repurchase Mandate are limited to a maximum of 10% of the total issued and fully paid share capital of the Company on the date of passing the resolution approving the Repurchase Mandate.

An explanatory statement, as required by the relevant rules regulating the repurchase by companies having primary listings on the Stock Exchange of their own shares as contained in the Listing Rules, to provide requisite information is set out in the appendix hereto.

GENERAL MANDATE TO ISSUE SHARES

At the AGM, an ordinary resolution will be proposed that the Directors be given a general and unconditional mandate to allot, issue and deal with shares up to a maximum of 182,091,205 shares representing approximately 20% of the total issued and fully paid share capital of the Company on the date the resolution is passed. In addition, an ordinary resolution will also be proposed to authorise an extension of such general mandate to be granted to the Directors to issue new shares by adding to it the number of shares repurchased under the Repurchase Mandate.

RE-ELECTION OF DIRECTORS

In accordance with Articles 92 and 101 of the Articles of Association of the Company, Mr. Wang Guanghao, Dr. Ren Xuefeng, Dr. Zhang Hongru, Dr. Pang Jinhua, Mr. Lau Wai Kit and Dr. Cheng Hon Kwan will retire as Directors and being eligible offer themselves for re-election at the forthcoming AGM. Details of Directors proposed to be re-elected at the AGM are set out in Appendix II to this circular.

ACTION TO BE TAKEN

A form of proxy for use at the AGM is enclosed herein. Whether or not you intend to attend this meeting, you are requested to complete the form of proxy and return it to the Company’s Share Registrar, Tengis Limited at G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong in accordance with the instructions printed thereon not less than 48 hours before the time fixed for holding the meeting, i.e. by 3: 00 p.m. on 25th May, 2005. Completion and return of form of proxy will not preclude you from attending and voting in person at the AGM if you so wish.

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PROCEDURE FOR DEMANDING A POLL

Pursuant to the existing Article 73, at any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded:

• (a) by the chairman: or

• (b) by a least three members of the Company present in person or in the case of a member of the Company being a corporation by its duly authorised representative or by proxy for the time being entitled to vote at the meeting; or

• (c) by any member or members of the Company present in person or in the case of a member of the Company being a corporation by its duly authorised representative or by proxy and representing not less than one-tenth of the total voting rights of all the members of the Company having the right to vote at the meeting; or

• (d) by any member or members of the Company present in person or in the case of a member of the Company being a corporation by its duly authorised representative or by proxy and holding shares in the Company conferring a right to vote at the meeting being 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.

ANNUAL GENERAL MEETING

Set out on pages 101 to 104 of the 2004 annual report is the notice of AGM at which resolutions will be proposed to approve the re-election of Directors, the Repurchase Mandate and the general mandate to issue new shares.

RECOMMENDATION

The Directors believe that the Repurchase Mandate and the general mandate to issue new shares are in the best interests of the Company and its shareholders. Accordingly, the Directors recommend that all shareholders should vote in favour of the relevant ordinary resolutions at the AGM.

Yours faithfully, By Order of the Board Wang Guanghao Chairman

As at the date of this circular, the Board consists of fifteen directors, Mr. Wang Guanghao, Dr. Ren Xuefeng, Mr. Yu Rumin, Dr. Zhang Hongru, Mr. Nie Jiansheng, Dr. Wang Jiandong, Mr. He Xiuheng, Mr. Yang Liheng, Mr. Sun Zengyin and Dr. Pang Jinhua as executive directors, Mr. Ye Disheng and Mr. Cheung Wing Yui as non-executive directors and Mr. Kwong Che Keung, Gordon, Mr. Lau Wai Kit and Dr. Cheng Hon Kwan as independent non-executive directors.

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EXPLANATORY STATEMENT

APPENDIX I

The appendix serves as an explanatory statement, as required by the Listing Rules, to provide requisite information to you for your consideration of the Repurchase Mandate.

The appendix also constitutes the memorandum required under section 49BA(3) of the Companies Ordinance.

1. SHARE CAPITAL

As at 21st April, 2005, being the latest practicable date prior to the printing of this document (‘‘Latest Practicable Date’’), the issued share capital of the Company comprised 910,456,027 shares of HK$0.10 each.

Subject to the passing of the ordinary resolution to approve the Repurchase Mandate and on the basis that no further shares are issued prior to the AGM, the Company would be allowed under the Repurchase Mandate to repurchase a maximum of 91,045,602 fully paid shares of HK$0.10 each.

2. FUNDING OF REPURCHASES

In repurchasing shares, the Company may only apply funds legally available for the purpose and in accordance with the Memorandum and Articles of Association of the Company and the relevant laws of Hong Kong. Such funds may include funds otherwise available for dividend or distribution and the proceeds of a fresh issue made for the purpose of the repurchases. Any premium payable on a repurchase must be provided for out of the funds of the Company otherwise available for dividend or distribution or out of the Company’s share premium account. The Directors propose that repurchases of shares under the Repurchase Mandate would be financed by the Company’s internal resources or existing banking facilities.

In the event that the proposed repurchases were to be carried out in full at any time during the proposed repurchase period, there could be an adverse impact on the working capital or gearing position of the Company which, in the opinion of the Directors, are from time to time appropriate for the Company as compared with the position disclosed in the latest published audited financial statements for the year ended 31st December, 2004. However, the Directors do not propose to exercise the Repurchase Mandate to such an extent.

3. SHARE PRICES

The highest and lowest prices at which the shares of the Company have traded on the Stock Exchange in previous twelve months before the Latest Practicable Date were as follows:

	Share	prices
Month	Highest	Lowest
	HK$	HK$
April 2004	3.550	2.950
May 2004	2.800	2.300
June 2004	2.750	2.500
July 2004	2.775	2.575
August 2004	2.750	2.550
September 2004	3.300	2.650
October 2004	2.975	2.800
November 2004	3.325	2.775
December 2004	3.450	3.000
January 2005	3.700	3.125
February 2005	3.575	3.350
March 2005	3.450	3.050
21st April, 2005*	3.275	3.000

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EXPLANATORY STATEMENT

APPENDIX I

4. GENERAL

The Directors have undertaken to the Stock Exchange that, they will exercise the powers of the Company to make repurchases pursuant to the Repurchase Mandate in accordance with the Listing Rules and the applicable laws of Hong Kong.

If, on the exercise of the powers to repurchase shares pursuant to the Repurchase Mandate, a shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of the Hong Kong Code on Takeovers and Mergers (the ‘‘Code’’). As a result, a shareholder, or group of shareholders acting in concert, could obtain or consolidate control of the Company or become obliged to make a mandatory offer in accordance with Rule 26 of the Code. As at the Latest Practicable Date, Tsinlien Group Company Limited (‘‘Tsinlien Group’’) holds 583,189,143 shares of the Company representing 64.05% of the issued share capital of the Company through its wholly-owned subsidiaries, Tianjin Investment Holdings Limited (as to 581,167,143 shares) and Tsinlien Property Services Limited (as to 2,022,000 shares), and short position of 40,000,000 shares of the Company which are subject to call options sold by Tsinlien Group to Credit Suisse Group (representing 4.39% of the issued share capital of the Company.

In the event that the Directors exercised in full the powers pursuant to the Repurchase Mandate, then (assuming the short position of 40,000,000 shares of the Company which are subject to call options sold by Tsinlien Group to Credit Suisse Group are not exercised and the present shareholdings remain the same) the shareholding of Tsinlien Group would be increased to 71.17% of the issued share capital of the Company and such increase would not give rise to an obligation to make a mandatory offer under Rule 26 of the Code. The Company has no present intention to repurchase shares to such extent as to result in the amount of shares held by the public being reduced to less than 25%.

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, their associates, have any present intention to sell any shares to the Company under the Repurchase Mandate if such Repurchase Mandate is approved by the shareholders.

The Company has not been notified by any connected persons (as defined in the Listing Rules) of the Company that they have a present intention to sell any share to the Company, or that they have undertaken to sell any shares held by them to the Company, in the event that the Repurchase Mandate is approved by its shareholders.

5. SHARE REPURCHASES MADE BY THE COMPANY

No repurchases of shares have been made by the Company whether on the Stock Exchange or otherwise in the six months preceding the Latest Practicable Date.

6. REASONS FOR REPURCHASES

The Directors believe that it is in the best interests of the Company and its shareholders for the Directors to have the power to repurchase shares pursuant to the Repurchase Mandate. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the earnings per share of the Company and will only be made when the Directors believe that such a repurchase will benefit the Company and its shareholders.

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RE-ELECTION OF DIRECTORS

APPENDIX II

Pursuant to the Listing Rules, the details of the Directors who will retire at the AGM according to the Articles of Association and propose to be re-elected at the AGM are provided below.

Mr. Wang Guanghao, aged 66, has been the Chairman and an Executive Director of the Company since June 1997. He is also the Chairman of Tsinlien Group Company Limited (‘‘Tsinlien Group’’). He was appointed as non-executive director of Dynasty Fine Wines Group Limited (stock no. 828, a company listed on the Stock Exchange) in August 2004. He graduated from Tianjin Mechanical Engineering Institute in 1962 and is a senior engineer. Before joining Tsinlien Group in May 1996, he was the vice general manager of Tianjin Petrochemical Machinery and Industrial Company, the deputy commissioner of the Tianjin Mechanic and Industrial Bureau, the commissioner of Tianjin Technology Supervision Bureau, the deputy director of Tianjin Foreign Economic Trade Commission and the director of the foreign investment office of the Tianjin Municipal People’s Government. Mr. Wang has extensive experience in engineering and corporate management in both government and private sectors for over 20 years. He was appointed a honorary chairman and an executive director of Wah Sang Gas Holdings Limited (stock no. 08035, a company listed on the Stock Exchange) in November 1998. Mr. Wang is a director of China Walfen Medical Limited, Deluxe Rich International Limited, Santa Resources Limited, Team Resources Limited, Tianjin Development Trading (BVI) Limited, Jetsome Holdings Limited, TD Finance (BVI) Limited, Dynamic Infrastructure Limited, Pearl Harbour Investment Limited, Coastal Rapid Transit Company Limited, Hero Honour Limited, Onbase Limited, Famous Ever Group Limited, Tianjin Development Assets Management Co., Ltd. and Walfen (Tianjin) Pharmaceutical Co., Ltd. all of which are subsidiaries of the Company.

As the Latest Practicable Date, Mr. Wang has personal interests in share options granted by the Company to subscribe for 1,000,000 shares at exercise price of HK$3.10. Save as aforesaid, Mr. Wang does not have any interest in shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance (‘‘SFO’’). Mr. Wang is a Director of Tsinlien Group Company Limited, a substantial shareholder of the Company (as defined in the Listing Rules). Mr. Wang has no relationships with any other Directors or senior management of the Company. Mr. Wang was appointed for a term of 3 years and subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. There is a services agreement as to the director’s fee of Mr. Wang and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

Dr. Ren Xuefeng, aged 38, was appointed Vice Chairman and an Executive Director of the Company in August 2004. He was also the Vice Chairman of Tsinlien Group. He is a Professor and Doctor’s adviser of Nankai University. He obtained his Doctorate in Business Management (Faculty of International Commerce) from Nankai University in 1998 and did post-doctor research at Tianjin University from 1999 to 2001. He was elected as one of the ‘‘Ten Outstanding Young Persons’’ in Tianjin in 2000. Dr. Ren was the general manager of Tianjin Hi-Tech Holding Limited and chairman of Tianjin Hi-Tech Technology Development Limited. Dr. Ren did not act any post of director with other subsidiaries of the Company. Dr. Ren did not hold any directorship in other listed companies in the last three years.

As the Latest Practicable Date, Dr. Ren has personal interests in share options granted by the Company to subscribe for 900,000 shares at exercise price of HK$3.10. Save as aforesaid, Dr. Ren does not have any interest in shares of the Company within the meaning of Part XV of the SFO. Dr. Ren is a Director of Tsinlien Group Company Limited, a substantial shareholder of the Company (as defined in the Listing Rules). Dr. Ren has no relationships with any other Directors or senior management of the Company. Dr. Ren is not appointed for a specific term except that he is subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. There is no agreement as to the director’s fee of Dr. Ren and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

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RE-ELECTION OF DIRECTORS

APPENDIX II

Dr. Zhang Hongru, aged 49, has been an Executive Director since September 2001 and appointed as General Manager of the Company in February 2004. He graduated from the Faculty of Law in China University of Political Science and Law in 1983 where he obtained a Bachelor degree in Law. He obtained a Master’s degree in 1996 and a Doctorate’s degree in 1999, both in economics, from Nankai University. Dr. Zhang also obtained Certificate in International Economics from the University of British Columbia in Canada in 1997. He is a senior economist, an attorney and a parttime professor of Nankai University and was an arbitrator of the Tianjin Economic Arbitration Committee. He was the head of Tianjin Valve Factory from 1988 to 1990, a department head of the Law Determination Office of Municipal Government from 1990 to 1995 and the deputy head of the Tianjin Port Free Trade Zone Administrative Committee from 1995 to 2001. He is also the director and general manager of Tsinlien Group. Dr. Zhang was appointed as the chairman and an executive director of Wah Sang Gas Holdings Limited (stock no. 08035, a company listed on the Stock Exchange) in May 2004 and appointed as Independent Non-executive director of Grand Investment International Ltd (stock no. 1160, a company listed on the Stock Exchange) in February 2004. Dr. Zhang is a director of Tianjin Jinzheng Transportation Development Co., Ltd, Tianjin Gangjin Real Estate Development Co., Ltd. and Tianjin Gang Ning Real Estate Development Co., Ltd., Learder Top Investments Limited, Santa Resources Limited, Tianjin Development Trading (BVI) Limited, Jetsome Holdings Limited, Golden Horse Resources Limited, Dynamic Infrastructure Limited, Pearl Harbour Investment Limited and Coastal Rapid Transit Company Limited, all of which are subsidiaries of the Company.

As the Latest Practicable Date, Dr. Zhang has personal interests in share options granted by the Company to subscribe for 800,000 shares at exercise price of HK$3.10. Save as aforesaid, Dr. Zhang does not have any interest in shares of the Company within the meaning of Part XV of the SFO. Dr. Zhang is a Director of Tsinlien Group Company Limited, a substantial shareholder of the Company (as defined in the Listing Rules). Dr. Zhang has no relationships with any other Directors or senior management of the Company. Dr. Zhang is appointed for a term of 3 years and subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. There is no agreement as to the director’s fee of Dr. Zhang and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

Dr. Pang Jinhua, aged 49, was appointed Executive Director of the Company in September 2000. He graduated from the Faculty of Electrical Engineering of Tianjin University. He was the secretary of the Tianjin Committee of The Communist Youth League of China during 1992 to 1997. He obtained a Master degree in Business Administration from Tianjin University in 1997 and a Doctorate degree in economics from Beijing Guang Hua Management College in 2000. Since June 1997, he was appointed the secretary of Leading Party Group of The Communist Party of China of The Administrative Commission of Tianjin Hi-tech Industrial Park and director of The Administrative Commission of Tianjin Hi-tech Industrial Park. Dr. Pang did not hold any directorship in other listed companies in the last three years and did not act any post of director with other subsidiaries of the Company.

As the Latest Practicable Date, Dr. Pang has personal interests in share options granted by the Company to subscribe for 300,000 shares at exercise price of HK$3.10. Save as aforesaid, Dr. Pang does not have any interest in shares of the Company within the meaning of Part XV of the SFO. Dr. Pang has no relationships with any other Directors or senior management or substantial or controlling shareholders (as defined in the Listing Rules) of the Company. Dr. Pang is appointed for a term of 3 years and subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. There is no agreement as to the director’s fee of Dr. Pang and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

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RE-ELECTION OF DIRECTORS

APPENDIX II

Mr. Lau Wai Kit, aged 42, was appointed as an Independent Non-executive Director of the Company in March 1998. He is a principal of Gobi Partners, Inc., a Shanghai-based venture capital firm focuses on digital media and technology investments in China. He has over ten years of experience in investment banking and direct investment. Mr. Lau is a solicitor of the Supreme Court of Hong Kong, an attorney and counselor at law of the Supreme Court of the State of California, a solicitor of the Supreme Court of England and Wales, and an advocate and solicitor of the Supreme Court of Singapore.

Mr. Lau is an independent non-executive director of China Insurance International Holdings Co. Limited (stock no. 966) and Shandong Weigao Group Medical Polymer Co. Limited (stock no. 8199), both companies are listed on the Stock Exchange. Mr. Lau did not act any post of director with other subsidiaries of the Company.

As the Latest Practicable Date, Mr. Lau does not have any interest in shares of the Company within the meaning of Part XV of the SFO. Mr. Lau is appointed for a term of 3 years and subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. Mr. Lau has no relationships with any other Directors or senior management or substantial or controlling shareholders (as defined in the Listing Rules) of the Company. There is no agreement as to the director’s fee of Mr. Lau and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

Dr. CHENG Hon Kwan, GBS, JP, aged 77, was appointed Independent Non-executive Director of the Company in June 2001. Dr. Cheng obtained his Bachelor’s Degree in Civil Engineering from Tianjin University and a DIC from Imperial College of Science and Technology, London. He has been awarded Honorary Doctor’s Degrees from Hong Kong University of Science and Technology, City University of Hong Kong, Open University of Hong Kong, and Open University, UK. He is a Fellow of Imperial College and City and Guilds London Institute. He is a Past President, Honorary Fellow and Gold Medallist of the Hong Kong Institution of Engineers; Past Vice President, Fellow and Gold Medallist of the Institution of Structural Engineers, Fellow of the Institution of Civil Engineers and of the American Society of Civil Engineers and Honorary Fellow of Engineers Australia. He is also an Honorary Member of the Hong Kong Institute of Planners. Dr. Cheng is an authorised person and registered structural engineer; Former Chairman of Hong Kong Housing Authority and Transport Advisory Committee and director of some other companies. He is a member of the Standing Committee of the Tianjin CPPCC, Chairman of Tianjin GangJin Architects & Engineers Ltd. and a permanent Honorary Chairman of the Hong Kong Tianjin Friendship Association. Currently Dr. Cheng is a non-executive director of Wing Hang Bank, Limited (stock no. 302), Hang Lung Group Limited (stock no. 10) and Hang Lung Properties Limited (stock no. 101), all companies are listed on the Stock Exchange. Dr. Cheng did not act any post of director with other subsidiaries of the Company.

As the Latest Practicable Date, Dr. Cheng does not have any interest in shares of the Company within the meaning of Part XV of the SFO. Dr. Cheng is appointed for a term of 3 years and subject to retirement by rotation and re-election in accordance with the Company’s Articles of Association. Dr. Cheng has no relationships with any other Directors or senior management or substantial or controlling shareholders (as defined in the Listing Rules) of the Company. There is no agreement as to the director’s fee of Dr. Cheng and his director’s fee will be determined by the Board by reference to the prevailing market conditions and subject to the shareholder’s approval at the AGM.

Save as disclosed above, the Board is not aware of any matters relating to the above proposed re-elections that need to be brought to the attention of the shareholders of the Company.

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