Medlive Technology Co., Ltd. — Capital/Financing Update 2011

Jun 10, 2011

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

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HISENSE KELON ELECTRICAL HOLDINGS COMPANY LIMITED 海信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: 00921)

ANNOUNCEMENT

Amendments to the proposed terms of the First Share Option Incentive Scheme and the proposed grant thereunder

This announcement is hereby made by the Company pursuant to Rule 13.09(1) of the Hong Kong Listing Rules.

Reference is made to the announcement of the Company dated 2 December 2010 in relation to the proposed adoption of the First Share Option Incentive Scheme and the proposed grant thereunder (the “ Previous Announcement ”). Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed thereto in the Previous Announcement.

The Company hereby announces that on 10 June 2011, the Board passed a resolution to approve certain amendments to the proposed terms of the Scheme and the proposed grant thereunder in view of the requests of the SASAC of Qingdao, the SASAC of the State Council and the CSRC. The major amendments are set out below:-

1. Scope of Participants

Under the first draft of the Scheme, the Participants include the directors of the Company (exclusive of the independent directors and external directors who are not officers of the Hisense Group), senior management (including president, vice president, financial controller, secretary to the Board, company secretary and other officers which are regarded as senior management under the Articles of Association) of the Company, mid-level management staff of the Company and its subsidiaries, and such key technical, sales and management personnel of the Company and its subsidiaries as determined by the Board.

It is proposed that the above provision be amended to the effect that the Participants include the directors of the Company (exclusive of the independent directors and external directors who are not officers of the Hisense Group), senior management (including president, vice president, financial controller, secretary to the Board, company secretary and other officers which are regarded as senior management under the Articles of Association) of the Company, mid-level management staff of the Company and its subsidiaries, and such key technical personnel of the Company and its subsidiaries as determined by the Board.

2. Results of the Company to be reached before Participants are granted Share Options

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One of the conditions which must be fulfilled before Participants are granted Share Options is that the results of the Company have reached certain conditions. Under the first draft of the Scheme, such conditions are that when comparing the years ended 2009 and 2010, the net profit growth rate (after deduction of any extraordinary gain or loss) shall not be lower than 20% (including 20%) and shall not be lower than the average growth rate of the industry, and the return on net assets (after deduction of any extraordinary gain or loss) shall not be lower than 12% (including 12% ) and shall not be lower than the average of the industry.

It is proposed that the above provision be amended to the effect that when comparing the years ended 2009 and 2010, the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) shall not be lower than 20% (including 20%) and shall not be lower than the average growth rate of the industry, and the weighted average rate of return on net assets ( 加 權平均淨資產收益率 ) (after deduction of any extraordinary gain or loss) shall not be lower than 15% (including 15% ) and shall not be lower than the average of the industry.

3. Results of the Company to be reached before Share Options may be exercised by Participants

One of the conditions which must be fulfilled before Share Options may be exercised by Participants is that the results of the Company have reached certain conditions. Under the first draft of the Scheme, such conditions are that during the Validity Period of the Share Options, the average net profit growth rate (after deduction of any extraordinary gain or loss) of the Company for each year shall not be lower than 20% (including 20%) and shall not be lower than the average growth rate of the industry, and the average return on net assets (after deduction of any extraordinary gain or loss) of the Company for each year shall not be lower than 15% (including 15%) and shall not be lower than the average of the industry.

It is proposed that the above provision be amended to the effect that during the Validity Period of the Share Options, the average figure for the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) of the Company for each year shall not be lower than 20% (including 20%) and shall not be lower than the average growth rate of the industry, and the average figure for the weighted average rate of return on net assets ( 加權平均淨資產收益率 ) (after deduction of any extraordinary gain or loss) of the Company for each year shall not be lower than 15% (including 15%) and shall not be lower than the average of the industry, and the details of the conditions in relation to the Company’s results of each Exercisable Period are proposed to be amended and restated as follows:-

• (i) First Exercisable Period

• (1) The average figure for (a) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2010 and 2011 and (b) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2011 and 2012 shall not be lower than 20% and shall not be lower than the average of the industry.

• (2) The average figure for the weighted average rate of return on net assets (加權平均淨資 產收益率) for the years 2011 and 2012 shall not be lower than 15% and shall not be lower than the average of the industry.

• (ii) Second Exercisable Period

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• (1) The average figure for (a) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2010 and 2011, (b) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2011 and 2012 and (c) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2012 and 2013 shall not be lower than 20% and shall not be lower than the average of the industry.

• (2) The average figure for the weighted average rate of return on net assets (加權平均淨資 產收益率) for the years 2011, 2012 and 2013 shall not be lower than 15% and shall not be lower than the average of the industry.

• (iii) Third Exercisable Period

• (1) The average figure for (a) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2010 and 2011, (b) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2011 and 2012, (c) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2012 and 2013 and (d) the growth rate of the audited net profit (after deduction of any extraordinary gain or loss) for the years 2013 and 2014 shall not be lower than 20% and shall not be lower than the average of the industry.

• (2) The average figure for the weighted average rate of return on net assets (加權平均淨資 產收益率) for the years 2011, 2012, 2013 and 2014 shall not be lower than 15% and shall not be lower than the average of the industry.

4. The number of underlying shares subject to the Share Options proposed to be granted pursuant to the Scheme and the allocation thereof

It is proposed that the number of underlying A shares subject to the Share Options proposed to be granted under the Scheme be reduced from 22,900,000 A shares to 20,610,000 A shares, representing approximately 1.522% of the total share capital (1,354,054,750 shares) of the Company and approximately 2.304% of the share capital of the same class (894,464,942 A shares) (the “ Grant ”), and all references to the number of Share Options and the number of underlying A shares subject to the Share Options shall be amended accordingly. Details of the allocation are as follows:-

								As a
								percentage
No.		Name		Position	Number of Share Options granted	As a percentage of the Grant	As a percentage of the total share capital	of share capital of the same class (A shares)
					(’0000	%	%	%
					shares)
	1		Tang Ye Guo	Chairman	126	6.11	0.093	0.141
	2		Xiao Jian Lin	Director	82.8	4.02	0.061	0.093

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3	Jia Shao Qian	Vice-President	82.8	4.02	0.061	0.093
4	Liu Chun Xin	Director,	90	4.37	0.066	0.101
		Vice-President,
		Head of Finance
		Department
5	Ren Li Ren	Vice-President	72	3.49	0.053	0.080
6	Zhang Yu Qing	Vice-President	82.8	4.02	0.061	0.093
7	Wang Yun Li	Vice-President	82.8	4.02	0.061	0.093
8	Mid level		1441.8	69.96	1.065	1.612
	management staff
	and key personnel
	(230 individuals)
	Total		2061	100.00	1.522	2.304

Explanation: Since Mr. Zhou Xiao Tian, being the President of the Company and Mr. Lin Lan, being a Director, are foreign natural persons, they cannot be granted and cannot exercise A share share options according to the current laws and regulations.

In addition, during the Validity Period of the Share Options, the maximum gain which the Participants can obtain from the share option incentives shall not exceed 40% of their remuneration level (inclusive of the gain from the share option incentives). In the event that the gain from the share option incentive exceeds the above proportion, Share Options which have not been exercised will not be exercised.

Save as disclosed above, there are no other material amendments to the terms of the Scheme and the Grant as disclosed in the Previous Announcement.

GENERAL

The revised draft of the Scheme has been examined and approved by the SASAC of Qingdao, filed with the SASAC of the State Council and filed with the CSRC with no objection. The Scheme shall be effective upon approval of the Scheme at the general meeting of the Company. The grant of Share Options and its effectiveness are also subject to the satisfaction of the conditions stipulated under the Scheme.

A circular containing, inter alia, the terms of the revised draft of the Scheme and the Grant, will be despatched to the shareholders of the Company on or before 15 July 2011 in accordance with the Hong Kong Listing Rules.

By order of the Board

Limited Tang Ye Guo Chairman

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Foshan City, Guangdong, the PRC, 10 June 2011

As at the date of this announcement, the Company’s directors are Mr. Tang Ye Guo, Mr. Zhou Xiao Tian, Ms. Yu Shu Min, Mr. Lin Lan, Mr. Xiao Jian Lin and Ms. Liu Chun Xin; and the Company’s independent non-executive directors are Mr. Zhang Sheng Ping, Mr. Cheung Yui Kai, Warren and Mr. Wang Ai Guo.

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