Medlive Technology Co., Ltd. — Capital/Financing Update 2006

Apr 24, 2006

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, 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 announcement.

GUANGDONG KELON ELECTRICAL HOLDINGS COMPANY LIMITED 廣東科龍電器股份有限公司

(A joint stock limited company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 0921)

THE SECOND SUPPLEMENTAL AGREEMENT TO THE TRANSFER AGREEMENT ENTERED INTO BETWEEN GUANGDONG GREENCOOL ENTERPRISE DEVELOPMENT COMPANY LIMITED AND QINGDAO HISENSE AIR-CONDITIONER COMPANY LIMITED

Reference is made to the announcements of the Company dated 14 September 2005 and 30 September 2005 respectively relating to the share transfer pursuant to the Transfer Agreement and the First Supplemental Agreement.

The Company was informed on 18 April 2006 that Guangdong Greencool and Hisense Air-Conditioner had on 15 April 2006 entered into the Second Supplemental Agreement to amend certain terms of the Transfer Agreement and the First Supplemental Agreement.

At the request of the Company, trading in H Shares of the Company was suspended with effect from 10:00 a.m. on 16 June 2005 pending the release of an announcement in relation to price sensitive information. Subject to the publication of a further announcement in relation to, amongst others, the financial, production and trading position of the Group, and the satisfaction by The Stock Exchange of Hong Kong Limited of the adequacy of the internal control measures of the Company, trading in H shares of the Company will remain suspended until further notice.

Reference is made to the announcement of Guangdong Kelon Electrical Holdings Company Limited (the “Company”) dated 14 September 2005 (the “Transfer Announcement”) relating to the sale by Guangdong Greencool Enterprise Development Company Limited (“Guangdong Greencool”) to Qingdao Hisense Air-Conditioner Company Limited (“Hisense Air-Conditioner”) of 262,212,194 domestic legal person shares in the Company (representing 26.43% of the Company’s total issued share capital as at the date of this Announcement) pursuant to the transfer agreement (the “Transfer Agreement”) entered into between Guangdong Greencool and Hisense Air-Conditioner, and the announcement dated 30 September 2005 (the “First Supplemental Agreement Announcement”) relating to the supplemental agreement entered into in respect of the Transfer Agreement (the “First Supplemental Agreement”). Terms used herein shall have the same meanings as defined in the First Supplemental Agreement Announcement unless otherwise stated.

The Company was informed by Hisense Air-Conditioner on 18 April 2006 that Guangdong Greencool and Hisense Air-Conditioner had on 15 April 2006 entered into “The Second Supplemental Agreement to ‘The Agreement In Relation to the Share Transfer of Guangdong Kelon Electrical Holdings Company Limited’ entered into between Guangdong Greencool Enterprise Development Company Limited and Qingdao Hisense Air-Conditioner Company Limited” (the “Second Supplemental Agreement”) to amend the Transfer Agreement and the First Supplemental Agreement. The amendments made in the Second Supplemental Agreement are briefly summarised as follows:

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1. CLAUSE 2.2 OF THE TRANSFER AGREEMENT

Pursuant to the First Supplemental Agreement Announcement, within 3 business days of Hisense AirConditioner making the payment of initial deposit in accordance with clause 3.1 of the Transfer Agreement (as amended by the First Supplemental Agreement), Guangdong Greencool shall complete all the procedures relating to the transfer of the Sale Shares to Hisense Air-Conditioner and that the Sale Shares shall be free from any encumbrances and charges (except required by laws).

Pursuant to clause 2 of the Second Supplemental Agreement, from the date of the Second Supplemental Agreement, both Guangdong Greencool and Hisense Air-Conditioner shall handle and complete all necessary matters relating to the transfer of the Sale Shares in accordance with the timing for the Transfer as agreed between the parties. Further, Guangdong Greencool is required to complete the transfer of the Sale Shares to Hisense Air-Conditioner not exceeding 15 business days from the date of Hisense Air-Conditioner making the initial payment in accordance with clause 3 of the Second Supplemental Agreement, and that the Sale Shares shall be free from any encumbrances (including pledge, foreclosure, freezing or any restriction to the rights of the Sale Shares except restrictions required by laws).

2. CLAUSE 3.1 OF THE TRANSFER AGREEMENT

Pursuant to the First Supplemental Agreement Announcement, an initial deposit in the amount of RMB500,000,000 is to be paid within 7 business days of the Transfer Agreement (as amended by the First Supplemental Agreement) taking effect, of which RMB20,000,000 is to be paid within 10 business days of the date of the Transfer Agreement (as amended by the First Supplemental Agreement). The First Supplemental Agreement also contained payment instructions in respect of the payment of such initial deposit.

Pursuant to clause 3 of the Second Supplemental Agreement, Guangdong Greencool and Hisense AirConditioner agreed to amend the consideration for the Sale Shares to be RMB680,000,000, and the initial deposit remains at RMB500,000,000. Hisense Air-Conditioner shall pay the initial deposit to Guangdong Greencool within 7 business days from the date of the Second Supplemental Agreement taking effect. The initial deposit is to be paid into the account (the “Designated Account”) designated by the Intermediate People’s Court of Foshan City of Guangdong Province (the “Court”). Such account will be frozen by the Court prior to the transfer of the Sales Shares. Once Hisense AirConditioner has paid the initial deposit into the Designated Account, Hisense Air-Conditioner is deemed to have satisfied its payment obligation for the initial deposit.

3. CLAUSE 3.2 OF THE TRANSFER AGREEMENT

Pursuant to the First Supplemental Agreement Announcement, Hisense Air-Conditioner is required to pay the balance of the adjusted consideration to Guangdong Greencool within 7 business days of the date of the transfer of the Sale Shares and RMB20,000,000 out of such balance is to be paid within 6 months after the date of transfer of the Sale Shares.

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Pursuant to clause 4 of the Second Supplemental Agreement, Hisense Air-Conditioner is required to pay the remaining balance of the consideration in the amount of RMB180,000,000 to Guangdong Greencool within 7 business days from the date of the transfer of the Sale Shares. The amount of RMB20,000,000 which Hisense Air-Conditioner has already paid into a jointly held account opened under the names of Hisense Air-Conditioner and 全國工商業聯合會 (the All-China Federation of Industry and Commerce) and the interest accrued during the period of jointly controlling the account is to be applied towards the satisfaction of such remaining balance of the consideration. Such amount of RMB20,000,000 and the relevant accrued interests are to be paid within 7 business days from the date of the transfer of the Sale Shares into the Designated Account. Once such amount is paid by Hisense Air-Conditioner into the Designated Account, Hisense Air-Conditioner is deemed to have satisfied its payment obligation thereunder.

4. CLAUSE 11.9 OF THE TRANSFER AGREEMENT

Pursuant to the First Supplemental Agreement, the completion of the Transfer Agreement is conditional upon:

• (a) the transfer being approved by the 國資委 (State Investment Committee) ;

• (b) disclosure of the acquisition report relating to the Transfer;

• (c) the transfer being approved by the 商務部 (Ministry of Commerce).

Hisense Air-Conditioner has the right under the Transfer Agreement (as amended by the First Supplemental Agreement) to waive all or any of the above conditions.

Pursuant to clause 5 of the Second Supplemental Agreement, in order to facilitate the transfer of the Sale Shares, Guangdong Greencool and Hisense Air-Conditioner agree that the Transfer Agreement and the First Supplemental Agreement will take effect immediately from the date conditions (a) and (b) above are satisfied. Both parties shall work together in an effort to obtain the approval of the Transfer by 商務部 (Ministry of Commerce) in accordance with condition (c) above after the restrictions imposed on the transfer of the Sale Shares are lifted.

THE PRC ARTICLE

Reference is also made to an article in the PRC dated 2 April 2006 (the “PRC Article”). The PRC Article stated that the consideration of the Transfer remains at RMB900 million, of which RMB220 million (the “Loan”) will be borrowed and guaranteed by the provincial government of Shunde of the PRC for Guangdong Greencool, and that Guangdong Greencool will repay the Loan in future using its own assets. The PRC Article also stated that Guangdong Greencool will transfer the entire amount of the Loan to Hisense Air-Conditioner in order for Hisense Air-Conditioner to effect the Transfer, and eventually as compensation by Guangdong Greencool for embezzling the funds of the Group.

In respect of the above allegations referred to in the PRC Article, the Company confirms that it has not received any document regarding any arrangement in relation to the amount of RMB220 million as at the date of this Announcement.

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At the request of the Company, trading in H Shares of the Company was suspended with effect from 10:00 a.m. on 16 June 2005 pending the release of an announcement in relation to price sensitive information. Subject to the publication of a further announcement in relation to, amongst others, the financial, production and trading position of the Group, and the satisfaction by The Stock Exchange of Hong Kong Limited of the adequacy of the internal control measures of the Company, trading in H shares of the Company will remain suspended until further notice.

By order of the Board of Guangdong Kelon Electrical Holdings Company Limited Liu Cong Meng Vice Chairman

As at the date of this announcement, the Company’s executive directors are Mr. Gu Chu Jun, Mr. Liu Cong Meng, Mr. Li Zhen Hua, Mr. Yan You Song, Mr. Zhang Hong and Mr. Fang Zhi Guo; and the independent non-executive directors are Mr. Li Kung Man and Mr. Xu Xiao Lu.

As disclosed in the Company’s previous announcements, Mr. Gu, Mr. Yan and Mr. Zhang Hong had been formally arrested by the Foshan City Police. None of them can be contacted as at the date hereof. As such, Mr. Gu, Mr. Yan and Mr. Zhang Hong do not accept responsibility for the contents of this announcement.

Foshan City, Guangdong, the PRC, 21 April , 2006

“Please also refer to the published version of this announcement in China Daily”

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