Medlive Technology Co., Ltd. — Proxy Solicitation & Information Statement 2004

Nov 29, 2004

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Guangdong Kelon Electrical Holdings Company Limited, you should at once hand this circular to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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

GUANGDONG KELON ELECTRICAL HOLDINGS COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 921)

GENERAL MANDATE TO REPURCHASE H SHARES RE-ELECTION OF DIRECTORS AND SUPERVISORS

Notices convening the EGM (as defined herein) and the H Shareholders EGM (as defined herein) to be held at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province on 15th January, 2005 at 11:00 a.m. and 10:30 a.m. respectively are set out on pages 17 to 25 of this circular and were published on 29th November, 2004. If you are not able to attend the said meetings, you are requested to complete the proxy form in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar in Hong Kong, Hong Kong Registrars Limited of Rooms 1712-1716, 17/F Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 24 hours before the time appointed for the holding of the relevant meetings. Completion and return of the proxy form will not prevent the Shareholders (as defined herein) from attending and voting in person at the EGM (as defined herein) and the H Shareholders EGM (as defined herein) should they so wish. Notice convening the Domestic Shareholders EGM (as defined herein) to be held at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province on 15th January, 2005 at 10:00 a.m. was published on 29th November, 2004.

29th November, 2004

CONTENTS

	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Conditions to repurchase H Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Repurchase Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Re-election of Directors and Supervisors . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Extraordinary General Meeting, H Shareholders EGM
and Domestic Shareholders EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Procedure to demand poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
APPENDIX I – EXPLANATORY STATEMENT . . . . . . . . . . . . . . . . . . . . .	8
APPENDIX II – DIRECTORS AND SUPERVISORS . . . . . . . . . . . . . . . . . .	12
NOTICE OF EXTRAORDINARY GENERAL MEETING. . . . . . . . . . . . . . . . . . .	17
NOTICE OF H SHAREHOLDERS EXTRAORDINARY
GENERAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23

−i −

DEFINITIONS

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

“Articles of Association”	the articles of association of the Company
“Board”	the board of Directors of the Company
“Company”	Guangdong Kelon Electrical Holdings Company Limited,
	the shares of which are listed on the Stock Exchange
“Company Law”	the Company Law of the PRC
“Director(s)”	director(s) of the Company
“Domestic Shares”	domestic shares of nominal value of RMB1.00 each in the
	capital of the Company
“Domestic Shareholders”	registered holders of Domestic Shares of the Company
“Domestic Shareholders EGM”	the extraordinary general meeting of the holders of
	Domestic Shares of the Company to be held at the
	conference room of the Company’s head office, Shunde
	District, Foshan City, Guangdong Province on 15th
	January, 2005 at 10:00 a.m. to approve the Repurchase
	Mandate
“EGM”	the extraordinary general meeting of all shareholders of
	the Company to be held at the conference room of the
	Company’s head office, Shunde District, Foshan City,
	Guangdong Province on 15th January, 2005 at 11:00 a.m.
	to approve the Repurchase Mandate and re-election of
	Directors and Supervisors
“Foreign Shares”	shares issued by the Company, the par value of which is
	denominated in RMB, and which are subscribed for in a
	currency other than RMB
“Group”	the Company and its subsidiaries
“H Share(s)”	overseas listed Foreign Share(s) of nominal value of
	RMB1.00 each in the capital of the Company which are
	listed on the Stock Exchange and subscribed for in HK
	dollars

−1 −

DEFINITIONS

“H Shareholders”	registered holders of H Shares of the Company
“H Shareholders EGM”	the extraordinary general meeting of the holders of H
	Shares of the Company to be held at the conference room
	of the Company’s head office, Shunde District, Foshan
	City, Guangdong Province on 15th January, 2005 at 10:30
	a.m. to approve the Repurchase Mandate
“Hong Kong”	Hong Kong Special Administrative Region of the
	People’s Republic of China
“Latest Practicable Date”	26th November, 2004, being the latest practicable date
	for ascertaining certain information in this circular prior
	to its publication
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange
“Mandatory Provisions”	The Mandatory Provisions for the Articles of Association
	of Companies seeking a Listing outside the PRC
“PRC”	The People’s Republic of China
“Relevant Period”	the period from the date of the passing of the resolution
	for the Repurchase Mandate until whichever is the
	earliest of:

• (a) the conclusion of the annual general meeting to be held in 2005 of the Company to be held in 2005;

• (b) the expiration of a period of twelve months following the passing of the special resolution for the Repurchase Mandate; or

• (c) the date on which the authority set out in the special resolution for the Repurchase Mandate is revoked or varied by a special resolution of the shareholders of the Company in any general meeting

“Repurchase Mandate”

• a general mandate to exercise the powers of the Company to repurchase up to 10% of the H Shares in issue of the Company as at the date of the said resolution

“SAEC”

State Administration for Exchange Control in the PRC

−2 −

DEFINITIONS

“Share(s)”	ordinary share(s) of RMB1.00 each in the share capital of
	the Company
“Shareholder(s)”	registered Domestic Shareholders and H Shareholders of
	the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Supervisor(s)”	supervisor(s) of the Company
“Takeovers Code”	The Hong Kong Code on Takeovers and Mergers
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“RMB”	Renminbi, the lawful currency of the PRC
“%”	per cent.

−3 −

LETTER FROM THE BOARD

GUANGDONG KELON ELECTRICAL HOLDINGS COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 921)

Executive Directors: Mr. Gu Chu Jun Mr. Liu Cong Meng Mr. Li Zhen Hua Mr. Yan You Song Mr. Zhang Hong Mr. Fang Zhi Guo

Independent Non-executive Directors:

Mr. Chan Pei Cheong, Andy Mr. Li Kung Man Mr. Xu Xiao Lu

Registered office: No. 8 Ronggang Road Ronggui Street, Shunde District Foshan City Guangdong Province China

Principal place of business in Hong Kong: Room 2502-2505, Harbour Centre 25 Harbour Road Wanchai Hong Kong

29th November, 2004

To the Shareholders

Dear Sir or Madam,

GENERAL MANDATE TO REPURCHASE H SHARES RE-ELECTION OF DIRECTORS AND SUPERVISORS

INTRODUCTION

The purpose of this circular is to provide you with information relating to the special resolution to be proposed at the forthcoming EGM, H Shareholders EGM and Domestic Shareholders EGM to grant the Directors a general mandate to exercise the power of the Company to undertake repurchases of the Company’s fully paid-up H Shares not exceeding 10% of the aggregate nominal value of H Shares in issue of the Company on the date of passing such special resolution. As the service terms of some of the Directors and Supervisors are due to expire, the Company also intends to re-elect its Directors and Supervisors at the EGM.

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LETTER FROM THE BOARD

The Company Law (to which the Company is subject) provides that a joint stock limited company incorporated in the PRC may not repurchase its shares unless such repurchase is effected for the purpose of reducing its share capital or, in connection with a merger between itself and another entity that holds its shares. The Company, if it effects a repurchase, at present intends to reduce its share capital. The Mandatory Provisions which the Company has followed in its Articles of Association provides that subject to obtaining the approval of the relevant regulatory authorities and compliance with its articles of association, share repurchases may be effected by a joint stock limited company listed outside the PRC for the purpose of reducing its share capital or in connection with a merger, between itself and another entity that holds its shares or in circumstances permitted by law or administrative regulations.

The Listing Rules permit shareholders of a PRC joint stock limited company to grant a general mandate to the Directors to repurchase H shares of such company that are listed on the Stock Exchange. Such mandate is required to be given by way of a special resolution passed by shareholders in general meeting and special resolution passed by holders of domestic shares and overseas listed Foreign Shares in separate meetings.

In addition, as the H Shares are traded on the Stock Exchange in Hong Kong dollars and the price payable by the Company upon any repurchase of H Shares will, therefore, be paid in Hong Kong dollars, the approval of the SAEC is also required.

In accordance with the requirements of Article 4.2 of the Articles of Association applicable to capital reduction, the Company will have to notify its creditors of the passing of such special resolution and the reduction to the registered capital of the Company that would occur should the Directors decide to exercise the Repurchase Mandate. Such notification has to be given in writing to the Company’s creditors within 10 days after the passing of such special resolution and also by way of the publication on at least 3 occasions of a press announcement within 30 days after the passing of such special resolution. Creditors then have a period of up to 30 days after the Company’s written notification or, if no such notification has been received, up to 90 days after the first publication of the press announcement to require the Company to repay amounts due to them or to provide guarantees in respect of such amounts.

CONDITIONS TO REPURCHASE H SHARES

In order to ensure flexibility and discretion to the Directors in the event that it becomes desirable to repurchase any H Shares (including where such repurchase may lead to an enhancement of the net asset value per H Share and/or the earnings per H Share), approval is being sought from the Shareholders for a conditional general mandate to repurchase H Shares in issue. In accordance with the legal and regulatory requirements described above, the Directors will convene the EGM, the H Shareholders EGM and the Domestic Shareholders EGM. At each such meeting, a special resolution, amongst other things, will be proposed to grant to the Directors a conditional general mandate to repurchase H Shares in issue on the

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LETTER FROM THE BOARD

Stock Exchange with an aggregate nominal value not exceeding 10% of the aggregate nominal value of H Shares in issue of the Company as at the date of the passing of such resolution. The Repurchase Mandate will be conditional upon (a) the special resolution approving the grant of the Repurchase Mandate being approved at each of the EGM, the H Shareholders EGM and the Domestic Shareholders EGM; (b) the approvals of the relevant regulatory authorities as required by the laws, rules and regulations of the PRC being obtained; and (c) the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to any of them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the notification procedure under Article 4.2 of the Articles of Association as described above. If the Company determines to repay any amount to any of its creditors in circumstances described under condition (c), it expects to do so out of its internal resources. If the conditions are not fulfilled, the Share Repurchase Mandate will not be exercisable by the Directors.

REPURCHASE MANDATE

A special resolution, amongst other things, will be proposed at the EGM, H Shareholders EGM and Domestic Shareholders EGM to grant to the Directors the Repurchase Mandate, details of which are set out in special resolution numbered 4 of the notice of the EGM, special resolution in the notice of H Shareholders EGM and special resolution in the notice of the Domestic Shareholders EGM. The H Shares which may be repurchased pursuant to the Repurchase Mandate shall not exceed 10% of the aggregate nominal value of H Shares in issue of the Company as at the date of passing of the resolutions approving the Repurchase Mandate.

An explanatory statement giving certain information regarding the Repurchase Mandate, is set out in Appendix I to this circular.

RE-ELECTION OF DIRECTORS AND SUPERVISORS

As the service term of some of the Directors and Supervisors are due to expire, the Company intends to re-elect its Directors and Supervisors at the upcoming EGM. Brief biographical details of the Directors and Supervisors to be re-elected are contained in Appendix II of this circular.

EXTRAORDINARY GENERAL MEETING, H SHAREHOLDERS EGM AND DOMESTIC SHAREHOLDERS EGM

The notices convening the EGM and H Shareholders EGM are set out in pages 17 to 25 of this circular and were published on 29th November, 2004. The notice convening the Domestic Shareholders EGM were published on 29th November, 2004.

−6 −

LETTER FROM THE BOARD

PROCEDURE TO DEMAND POLL

In accordance with article 8.23 of the Articles of Association, a poll may be demanded in any general meeting of the Company by:

• (a) the chairman of the meeting; or

• (b) at least two shareholders with voting rights or their representative; or

• (c) individual or a group of shareholders (including their representatives) holding 10% or more of the voting rights present in that general meeting.

RECOMMENDATION

The Directors consider that the granting of the Repurchase Mandate is in the best interests of the Company and its Shareholders and accordingly recommend that all Shareholders vote in favour of all resolutions to be proposed at EGM and H Shareholders EGM.

Yours faithfully,

By order of the Board of

Guangdong Kelon Electrical Holdings Company Limited Gu Chu Jun Chairman

−7 −

EXPLANATORY STATEMENT

APPENDIX I

In accordance with the Listing Rules, this appendix serves as an explanatory statement, to provide you with the requisite information reasonably necessary to enable you to make all informed decision on whether to vote for or, against special resolution numbered 4 to be proposed at the EGM, special resolution to be proposed at the H Shareholders EGM and the special resolution to be proposed at the Domestic Shareholders EGM.

SECURITIES REPURCHASE MANDATE

Reasons for Repurchase of H Shares

The Directors believe that the flexibility afforded by the Repurchase Mandate would be beneficial to and in the best interest of the Company and its Shareholders. Such repurchases may, depending on market conditions and funding arrangements at such time, lead to an enhancement of the net asset value and/or earnings per Share of the Company. Such repurchases will only be made when the Directors believe that such repurchases will benefit the Company and its Shareholders.

Registered Capital

As at the Latest Practicable Date, the registered capital of the Company was RMB992,006,563 comprising of 459,589,808 H Shares of RMB1.00 each and 532,416,755 Domestic Shares of RMB1.00 each.

Exercise of the Repurchase Mandate

Subject to the passing of special resolution numbered 4 set out in the notice of EGM, the special resolution approving the grant to the Directors of the Repurchase Mandate in the H Shareholders EGM and Domestic Shareholders EGM respectively, the Directors will be granted the Repurchase Mandate until the end of the Relevant Period (as defined in special resolution numbered 4 in the notice of EGM). The exercise of the Repurchase Mandate is subject to the approvals of the relevant regulatory authorities as required by the laws, rules and regulations of the PRC being obtained and to the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to any of them (or, if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the notification procedure under Article 4.2 of the Articles of Association.

The exercise in full of the Repurchase Mandate (on the basis of 459,589,808 H Shares in issue and fully paid up as at the Latest Practicable Date) would result in up to 45,958,980 H Shares being repurchased by the Company during the Relevant Period.

−8 −

EXPLANATORY STATEMENT

APPENDIX I

Funding of Repurchases

In repurchasing its H Shares, the Company intends to apply funds from the Company’s internal resources (which may include surplus funds and retained profits) legally available for such purpose in accordance with the Articles of Association and the applicable laws, rules and regulations of the PRC.

The Company is empowered by its Articles of Association to purchase its H Shares. All repurchases by the Company may only be made out of either the capital paid up on the relevant shares to be repurchased, or the funds of the Company that would otherwise be available for dividend of distribution or out of the proceeds of a new issue of shares made for such purpose or from sums standing to the credit of the share premium account of the Company. Under PRC laws, H Shares so repurchased will be treated as cancelled and the Company’s registered capital will be reduced by an amount equivalent to the aggregate nominal value of the H Shares so cancelled. The Company may not purchase securities on the Stock Exchange for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange from time to time.

GENERAL

There will not be any material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the latest published audited accounts contained in the 2003 annual report of the Company for the year ended 31st December, 2003) in the event that the Repurchase Mandate is to be exercised in full at any time during the proposed repurchase period. The number of H Shares to be repurchased on any occasion and the price and other terms upon which the same are repurchased will be decided by the Directors at the relevant time having regarded to the circumstances then prevailing and in the best interests of the Company.

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the powers of the Company to make repurchases under the Repurchase Mandate in accordance with the Listing Rules, the Articles of Association and the applicable laws, rules and regulations of the PRC.

−9 −

EXPLANATORY STATEMENT

APPENDIX I

H SHARES PRICES

The highest and lowest prices at which the H Shares have been traded on the Stock Exchange during each of the twelve months preceding the Latest Practicable Date were as follows:

								**Per **	Share
							Highest			Lowest
							HK$			HK$
Month
2003
December							3.775			3.000
2004
January							3.675			3.175
February							4.975			3.350
March							4.625			3.900
April							4.350			2.950
May							3.275			2.650
June							3.350			2.525
July							3.400			2.700
August							3.200			2.650
September							3.025			2.650
October							2.850			2.275
November	(up	to	the	Latest	Practicable	Date)	2.500			2.025

H SHARE PURCHASED BY THE COMPANY

No purchase of H Shares has been made by the Company within 6 months preceding the date of this circular (whether on the Stock Exchange or otherwise).

DISCLOSURE OF INTERESTS

If as a result of a share repurchase by the Company, a substantial shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purpose of the Takeovers Code. Accordingly, a shareholder, or group of shareholders acting in concert, could obtain or consolidate control of the Company or become obligated to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, Greencool Enterprise Development Company Limited, whose interest in the Company is notifiable under Part XV (Disclosure of Interests) of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), held directly or indirectly approximately 26.43% of the Company’s total registered capital . In the event that

−10 −

EXPLANATORY STATEMENT

APPENDIX I

the Directors exercised in full the power to repurchase H Shares in accordance with the terms of the Repurchase Mandate proposed at the EGM, H Shareholders EGM and Domestic Shareholders EGM, the total interests of Greencool Enterprise Development Company Limited in the total registered capital of the Company would be increased to approximately 27.72%. The Directors are not aware of any consequences which will arise under the Takeovers Code and/or any similar applicable law, as a result of any purchases to be made under the Repurchase Mandate. Moreover, the Directors will not make share repurchase on the Stock Exchange if the result of the repurchase would be that less than 25% of the total registered capital of the Company would be in the public hands.

None of the Directors nor, to the best of their knowledge, having made all reasonable enquiries, any of their associates (as defined in the Listing Rules) presently intends to sell H Shares to the Company under the Repurchase Mandate in the event that the Repurchase Mandate is approved by the Shareholders and the conditions to which the Repurchase Mandate is subject are fulfilled.

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 H Shares to the Company, or, that they have undertaken not to sell any H Shares held by them to the Company in the event that the Repurchase Mandate is approved by its Shareholders and the conditions to which the Repurchase Mandate is subject are fulfilled.

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DIRECTORS AND SUPERVISORS

APPENDIX II

Brief biographical details of the Directors and Supervisors to be re-elected at the EGM are set out below:

1. Mr. Gu Chu Jun (“Mr. Gu”), age 45, is the Chairman of the Company. He has been an executive director of the Company since December 2001. Mr. Gu graduated with a Master’s degree in engineering from Tianjin University, the PRC. He is the inventor and patent rights holder of Greencool Refrigerants. Mr. Gu is also the founder of the Greencool Group (“the Greencool Group”). He is the chairman of the board of Greencool Enterprise Development Company Limited (“Greencool Enterprise Development”), Greencool Refrigerant (China) Company Limited (“Greencool Refrigerants China”), Hefei Meiling Company Limited, Greencool Technology Holdings Limited (“Greencool Tech”) and Yangzhou Yaxing Motor Coach Company Limited. Mr. Gu has over 18 years of experience in the refrigeration engineering and refrigerant industry. Prior to founding the Group, he taught at Tianjin University and devoted himself to the research of thermodynamics and refrigeration engineering.

Mr. Gu entered into a service agreement with the Company. Mr. Gu’s remuneration is HK$6,000,000 per annum which was determined based on Mr. Gu’s position in the Company.

1. Mr. Liu Cong Meng (“Mr. Liu”), age 59, has been an executive director and the Vice-Chairman of the Company since December 2001, he also accepted appointment as President and Chief Executive of the Company since January 2002. Mr. Liu joined the Greencool Group in July 1998. He is currently the executive director of Greencool Tech, a company listed on the Stock Exchange of Hong Kong. Mr. Liu obtained his Bachelor’s degree in Beijing University in the PRC and has extensive experience in economic management, environmental protection and international cooperation. Before he joined the Greencool Group, Mr. Liu held offices as a diplomat in the Chinese Embassies in various countries such as the United States of America. Mr. Liu also held office in the Department of International Cooperation of the Ministry of Agriculture in the PRC, during which time he was responsible for handling the PRC’s bilateral and multilateral economic and technical cooperation projects with international organisations such as the World Bank and other countries. In addition, Mr. Liu was also a member of the China National Committee for Pacific Economic Cooperation Council (PECC) and a guest foreign consultant to the Policy Secretariat of the Australian Centre for International Agricultural Research (ACIAR) of the Australian Government.

Mr. Liu entered into a service agreement with the Company. Mr. Liu’s remuneration is HK$1,800,000 per annum which was determined based on Mr. Liu’s position in the Company.

1. Mr. Li Zhen Hua (“Mr. Li”), age 52, has been an executive director and the Vice-Chairman of the Company since December 2001. After receiving his tertiary education, Mr. Li held offices as general manager of Shunde Wan Jia Le Group

−12 −

DIRECTORS AND SUPERVISORS

APPENDIX II

Limited, Chairman of Guangdong Macro Company Limited, General Manager of Shunde Cheng Shun Investment Company, chief of Rongqi Economic Development Committee, deputy secretary of Rongqi Town Communist Party Committee, deputy township chief of Rongqi, deputy chief of Ronggui Public Asset Management Committee, deputy secretary of Ronggui Town Communist Party Committee and deputy chief of Ronggui Town.

Mr. Li entered into a service agreement with the Company. Mr. Li’s remuneration is HK$1,800,000 per annum which was determined based on Mr. Li’s position in the Company.

1. Mr. Yan You Song (“Mr. Yan”), age 39, has been an executive director of the Company since December 2001. Mr. Yan joined the Greencool Group in 1995 as Vice-President of Beijing Greencool Environmental Protection Engineering Company Limited (“Beijing Greencool Environmental”). Mr. Yan obtained his Master’s degree in material studies from Beijing Aeronautics & Space-flight University in 1989. From 1991 to 1994, Mr. Yan held offices as Deputy Factory Manager and Chief Engineer in Beijing Dongshong Group Corporation Limited. Mr. Yan has led experiments using Greencool refrigerants in new products and has been active in the Greencool Group’s business negotiations.

Mr. Yan entered into a service agreement with the Company. Mr. Yan’s remuneration is HK$1,200,000 per annum which was determined based on Mr. Yan’s position in the Company.

1. Mr. Zhang Hong, (“Mr. Hong”), age 42, is a senior engineer. He has been an executive director of the Company since December 2001. He joined the Greencool Group in 1991 as an engineer. In 1995, Mr. Zhang was appointed Vice-President of Greencool Refrigerant China. In 1998, he held office as the Vice-President of Beijing Greencool Environmental. Mr. Zhang obtained his Bachelor’s degree in Technology in the Jiangsu Polytechnic University. He has 20 years experience in mechanical engineering, refrigeration engineering and air-conditioning engineering. Mr. Zhang gained extensive managerial experience through working as an officer for certain domestic and foreign enterprises for seven years.

Mr. Zhang entered into a service agreement with the Company. Mr. Zhang’s remuneration is HK$960,000 per annum which was determined based on Mr. Zhang’s position in the Company.

1. Mr. Fang Zhi Guo (“Mr. Fang”), age 42, has been an executive director of the Company since December 2001. He obtained his Bachelor’s degree in mechanical engineering from Tianjing University in July 1983 and his master’s degree in mechanical engineering from Tianjing Industrial University in December 1985. He became a lecturer and subsequently the Chair in the Mechanical Engineering faculty of Tianjin Industrial University between January 1986 and February 1995. Mr. Fang

−13 −

DIRECTORS AND SUPERVISORS

APPENDIX II

joined Greencool Refrigerant China as a director and Vice-President in 1995. He also became the Head of Greencool Refrigerant Research Institute. Mr. Fang has extensive experience in the manufacture and product design and development of refrigerants. He has an in-depth understanding in the research of the thermo-physical characteristics of Greencool refrigerants. He is also well-experienced in enterprise and scientific research management.

Mr. Fang entered into a service agreement with the Company. Mr. Fang’s remuneration is HK$960,000 per annum which was determined based on Mr. Fang’s position in the Company.

1. Mr. Chan Pei Cheong, Andy (“Mr. Chan”), age 43, MBA, FCCA, FHKSA, ACIS, HKICS, has been an independent non-executive director of the Company since December 2001. He has extensive experience in financial management, investment and corporate finance. Mr. Chan was a director in the corporate finance department of a merchant bank, and during his office, he was involved in corporate restructuring, takeovers and capital markets work. Concurrently, Mr. Chan also worked in an international firm of auditors and specialised in corporate auditing and financial management. In the 1990s, Mr. Chan also joined the Listing Division of the Stock Exchange of Hong Kong Limited as a manager. His duties included reviewing, coordinating and approving arrangements for listing of companies, initial public offering, issue of derivatives and share buy-backs. Mr. Chan holds a Master’s degree in Business Administration from the University of Durham, England and a diploma in accountancy with honours from the Lingnan University in Hong Kong. He is also a fellow of the Association of Chartered and Certified Accountants, Hong Kong Society of Accountants (now named the Hong Kong Institute of Certified Public Accountants), a fellow of the Institute of Chartered Secretaries and Administrators and the Hong Kong Institute of Company Secretaries. Mr. Chan is a certified practising accountant in Hong Kong and in the United Kingdom. Mr. Chan is currently a partner of an accounting firm in Hong Kong, and is an independent non-executive director of Rexcapital International Holdings Limited, a company listed on the Hong Kong Stock Exchange.

Mr. Pei entered into a service agreement with the Company. Mr. Pei’s remuneration is HK$360,000 per annum which was determined based on Mr. Pei’s position in the Company.

1. Mr. Li Kung Man (“Mr. Li”), age 47, has been an independent non-executive director of the Company since 2002. He has obtained a higher diploma from the Hong Kong Polytechnic University. He is also a fellow of The Chartered Association of Certified Accountants, United Kingdom and a member of the Hong Kong Society of Accountants (now named the Hong Kong Institute of Certified Public Accountants). He was an executive director of Mindun Group and Sunfore Group and he has extensive work experience in trading, manufacturing and property development. He was also engaged in accounting and auditing work with China

−14 −

DIRECTORS AND SUPERVISORS

APPENDIX II

Light & Power Co. Ltd. and PricewaterhouseCoopers. Mr Li is currently a director of Tak Wah Electronic Company Limited and an independent non-executive director of AKM Industrial Company Limited. Mr. Li has over twenty years of experience in the accounting field and working in business corporations. He also has a thorough understanding of financial management of companies (including China’s business environment).

Mr. Li entered into a service agreement with the Company. Mr. Li’s remuneration is HK$360,000 per annum which was determined based on Mr. Li’s position in the Company.

1. Mr. Xu Xiaolu (“Mr. Xu”) age 48, has been an independent non-executive director of the Company since 2003. He graduated in financial trading from Beijing Economics College. During 1982 and 1993, Mr. Xu took up various positions in the China National Petroleum Corporation (Petroleum Industrial Department), such as Head of Section, Deputy Head of Department and Head of Financial Department. From May 1993 to December 1999, Mr. Xu worked in CNPC (Hong Kong) Limited, during that time, Mr. Xu took up various positions such as executive director (1993-1996), Managing Director (1996-1997) and Vice-Chairman and President (1997-1999). Between 1999 to 2000, Mr. Xu joined PetroChina Company Limited as Assistant Secretary to the Board, the Company’s Authorised Representative in Hong Kong and Head of Investor Relations. During 2000 to 2003, Mr. Xu joined Sino InfoTech Holdings Limited as Managing Director. Since September 2003, Mr. Xu joined Beijing Fengde Investment Management Limited as a Chairman and Executive President.

Mr. Xu entered into a service agreement with the Company. Mr. Xu’s remuneration is HK$360,000 per annum which was determined based on Mr. Xu’s position in the Company.

1. Mr. Bai Yun Feng (“Mr. Bai”), age 42, has been a supervisor of the Company since 2002. He obtained his Bachelor’s degree in Automation from the Beijing Mechanical Engineering College. He then obtained a Master’s degree in Western Economics from Nan Kai University. Mr Bai previously worked as an engineer at the Beijing General Mechanical Research Institute, the Deputy Factory Director of Shenzhen Hua Mei Chemical Company Limited and the Deputy Head of China National Packaging Import and Export Corporation and the Senior Assistant to the President of Beijing Greencool Environmental. Mr. Bai currently works for Guangdong Kelon Air-conditioner Company Limited, a subsidiary of the Company, as Deputy General Manager.

Mr. Bai entered into a service agreement with the Company. Mr. Bai’s remuneration is RMB440,000 per annum which was determined based on Mr. Bai’s position in the Company.

−15 −

DIRECTORS AND SUPERVISORS

APPENDIX II

1. Mr. Zeng Jun Hong (“Mr. Zeng”), age 31, graduated with a Master’s degree in Administration from the Beijing Graduate School of China University of Mining and Technology. In August 2001, Mr. Zeng joined Beijing Greencool Environmental as a project manager. In June 2002, Mr. Zeng became the assistant to the President of Jiangxi Greencool Enterprise Development Company Limited. In February 2004, he became the Deputy General Manager of Guangdong Kelon Fittings Company Limited. In July 2004, Mr. Zeng was appointed Chief Supervisor of the Company’s Procurement Centre.

Mr. Zeng entered into a service agreement with the Company. Mr. Zeng’s remuneration is RMB240,000 per annum which was determined based on Mr. Jiang’s position in the Company.

1. In accordance with the articles of association of the Company, the initial appointments for the directors, independent non-executive directors and supervisors will be for three years.

2. Save for Mr. Gu, none of the directors and supervisors is related to any director, senior management or substantial or controlling shareholders of the Company nor do they have any interests in shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance. Mr. Gu is an executive director of the Company and is indirectly interested in 262,212,194 Legal Person Shares and 3,830,000 H Shares of the Company.

3. Greencool Enterprise Development owns 262,212,194 Legal Person Shares of the Company, representing 26.43% of the total issued share capital of the Company. Mr. Gu owns 60% interest of Greencool Enterprise Development.

4. Mr. Gu is a major shareholder, holding 62.5% of Greencool Tech, a company listed on the Hong Kong of Stock Exchange. Two of Greencool Tech’s subsidiaries own 3,830,000 H Shares issued by the Company, representing 0.39% of the total issued share capital of the Company.

5. There are no other matters that need to be brought to the attention of the holders of securities of the Company in connection with the appointments.

−16 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

GUANGDONG KELON ELECTRICAL HOLDINGS COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 921)

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting of Guangdong Kelon Electrical Holdings Company Limited (the “Company”) will be held at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province on 15th January, 2005 at 11:00 a.m. for the purpose of considering, and, if thought fit, passing with or without amendment, the following resolutions which will be proposed as ordinary resolution and special resolution of the Company:

ORDINARY RESOLUTION

1. “ THAT the following persons be re-elected as executive directors of the Company:

2. (i) Mr. Gu Chu Jun;

3. (ii) Mr. Liu Cong Meng;

4. (iii) Mr. Li Zhen Hua;

5. (iv) Mr. Yan You Song;

6. (v) Mr. Zhang Hong; and

7. (vi) Mr. Fang Zhi Guo”

8. “ THAT the following persons be re-elected as independent non-executive directors of the Company:

9. (i) Mr. Chan Pei Cheong;

10. (ii) Mr. Li Kung Man; and

11. (iii) Mr. Xu Xiao Lu”

12. “ THAT Mr. Bai Yun Feng be re-elected and Mr. Zeng Jun Hong be elected as supervisors of the Company.”

−17 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

SPECIAL RESOLUTION

1. “ THAT

2. (i) subject to sub-paragraph (ii) and (iii) of this resolution, the exercise by the directors of the Company during the Relevant Period (as hereinafter defined) of all powers of the Company to repurchase the overseas-listed foreign shares (“H shares”) in issue of the Company on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the securities of the Company may be listed and recognised by the Securities and Futures Commission and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws, rules and regulations and/or requirements of the governmental or regulatory body of securities in the PRC, the Stock Exchange or any other stock exchange as amended from time to time, or of any other governmental or regulatory body be and is hereby generally and unconditionally approved;

3. (ii) the aggregate nominal amount of the H Shares of the Company which the directors of the Company are authorised to repurchase pursuant to the approval in subparagraph (i) of this resolution shall not exceed 10 per cent. of the aggregate nominal amount of the H Shares of the Company in issue on the date of passing this resolution; and

4. (iii) the approval in sub-paragraph (i) above shall be conditional upon:

   • (a) the passing of a special resolution in the same terms as the resolution set out in this paragraph (except for this sub-paragraph (iii)(a) at (1) the extraordinary general meeting for holders of H Shares to be held on 15th January, 2005 (or on such adjourned date as may be applicable); and (2) the extraordinary general meeting for holders of domestic shares of the Company to be held on 15th January, 2005 (or on such adjourned date as may be applicable);

   • (b) the approvals of the regulatory authorities as required by the laws, rules and regulations of the PRC being obtained by the Company if appropriate; and

   • (c) the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the notification procedure set out in Article 4.2 of the articles of association of the Company;

−18 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

• (iv) for the purpose of this resolution:

“Relevant Period” means the period from the date of the passing of this resolution until whichever is the earliest of:

• (a) the conclusion of the next annual general meeting of the Company;

• (b) the expiration of a period of twelve months following the passing of this special resolution; or

• (c) the date on which the authority set out in this special resolution is revoked or varied by a special resolution of the shareholders of the Company in any general meeting; and

• (v) subject to approval of all relevant governmental authorities in the PRC for the repurchase of such H Shares being granted, the Board be hereby authorized to:

• (a) make such amendments to the articles of association accordingly as it thinks fit so as to reduce the registered share capital of the Company and to reflect the new capital structure of the Company upon the repurchase of H Shares of the Company as contemplated in paragraph (i) above; and

• (b) file the amended articles of association of the Company with the relevant government authorities of the PRC.”

By order of the Board of Guangdong Kelon Electrical Holdings Company Limited Gu Chu Jun

Chairman

Foshan City, Guangdong, the PRC, 26th November, 2004

Notes:

1. The register of members of the Company will be closed from 16th December, 2004 to 15th January, 2005, both days inclusive, during which period no share transfers will be registered. To qualify for attendance at the extraordinary general meeting, all transfers accompanied by the relevant share certificates must be lodged with the Company’s Branch Share Registrar in Hong Kong, Hong Kong Registrars Limited of Rooms 1712-1716, 17/F Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, no later than 4:00 p.m. on 15th December, 2004, for registration.

1. Shareholders intending to attend the extraordinary general meeting shall give written notice of the same to the Company, which shall be lodged at the registered office of the Company on or before 4:00 p.m. on 24th December, 2004.

2. Shareholders entitled to attend and vote at the extraordinary general meeting are entitled to appoint one or more persons (whether or not a shareholder of the Company) as their proxy to attend and vote on behalf of themselves.

3. In order to be valid, the form of proxy, together with a duly notarised power of attorney or other document of authority, if any, under which the form is signed must be deposited at the registered office of the Company not later than 24 hours before the time for holding the extraordinary general meeting.

−19 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

1. Mr. Gu Chu Jun (“Mr. Gu”), age 45, is the Chairman of the Company. He has been an executive director of the Company since December 2001. Mr. Gu graduated with a Master’s degree in engineering from Tianjin University, the PRC. He is the inventor and patent rights holder of Greencool Refrigerants. Mr. Gu is also the founder of the Greencool Group (“the Greencool Group”). He is the chairman of the board of Greencool Enterprise Development Company Limited (“Greencool Enterprise Development”), Greencool Refrigerant (China) Company Limited (“Greencool Refrigerants China”), Hefei Meiling Company Limited, Greencool Technology Holdings Limited (“Greencool Tech”) and Yangzhou Yaxing Motor Coach Company Limited. Mr. Gu has over 18 years of experience in the refrigeration engineering and refrigerant industry. Prior to founding the Group, he taught at Tianjin University and devoted himself to the research of thermodynamics and refrigeration engineering.

Mr. Gu entered into a service agreement with the Company. Mr. Gu’s remuneration is HK$6,000,000 per annum which was determined based on Mr. Gu’s position in the Company.

1. Mr. Liu Cong Meng (“Mr. Liu”), age 59, has been an executive director and the Vice-Chairman of the Company since December 2001, he also accepted appointment as President and Chief Executive of the Company since January 2002. Mr. Liu joined the Greencool Group in July 1998. He is currently the executive director of Greencool Tech, a company listed on the Stock Exchange of Hong Kong. Mr. Liu obtained his Bachelor’s degree in Beijing University in the PRC and has extensive experience in economic management, environmental protection and international cooperation. Before he joined the Greencool Group, Mr. Liu held offices as a diplomat in the Chinese Embassies in various countries such as the United States of America. Mr. Liu also held office in the Department of International Cooperation of the Ministry of Agriculture in the PRC, during which time he was responsible for handling the PRC’s bilateral and multilateral economic and technical cooperation projects with international organisations such as the World Bank and other countries. In addition, Mr. Liu was also a member of the China National Committee for Pacific Economic Cooperation Council (PECC) and a guest foreign consultant to the Policy Secretariat of the Australian Centre for International Agricultural Research (ACIAR) of the Australian Government.

Mr. Liu entered into a service agreement with the Company. Mr. Liu’s remuneration is HK$1,800,000 per annum which was determined based on Mr. Liu’s position in the Company.

1. Mr. Li Zhen Hua (“Mr. Li”), age 52, has been an executive director and the Vice-Chairman of the Company since December 2001. After receiving his tertiary education, Mr. Li held offices as general manager of Shunde Wan Jia Le Group Limited, Chairman of Guangdong Macro Company Limited, General Manager of Shunde Cheng Shun Investment Company, chief of Rongqi Economic Development Committee, deputy secretary of Rongqi Town Communist Party Committee, deputy township chief of Rongqi, deputy chief of Ronggui Public Asset Management Committee, deputy secretary of Ronggui Town Communist Party Committee and deputy chief of Ronggui Town.

Mr. Li entered into a service agreement with the Company. Mr. Li’s remuneration is HK$1,800,000 per annum which was determined based on Mr. Li’s position in the Company.

1. Mr. Yan You Song (“Mr. Yan”), age 39, has been an executive director of the Company since December 2001. Mr. Yan joined the Greencool Group in 1995 as Vice-President of Beijing Greencool Environmental Protection Engineering Company Limited (“Beijing Greencool Environmental”). Mr. Yan obtained his Master’s degree in material studies from Beijing Aeronautics & Space-flight University in 1989. From 1991 to 1994, Mr. Yan held offices as Deputy Factory Manager and Chief Engineer in Beijing Dongshong Group Corporation Limited. Mr. Yan has led experiments using Greencool refrigerants in new products and has been active in the Greencool Group’s business negotiations.

Mr. Yan entered into a service agreement with the Company. Mr. Yan’s remuneration is HK$1,200,000 per annum which was determined based on Mr. Yan’s position in the Company.

1. Mr. Zhang Hong, (“Mr. Hong”), age 42, is a senior engineer. He has been an executive director of the Company since December 2001. He joined the Greencool Group in 1991 as an engineer. In 1995, Mr. Zhang was appointed Vice-President of Greencool Refrigerant China. In 1998, he held office as the Vice-President of Beijing Greencool Environmental. Mr. Zhang obtained his Bachelor’s degree in Technology in the Jiangsu Polytechnic University. He has 20 years experience in mechanical engineering, refrigeration engineering and air-conditioning engineering. Mr. Zhang gained extensive managerial experience through working as an officer for certain domestic and foreign enterprises for seven years.

Mr. Zhang entered into a service agreement with the Company. Mr. Zhang’s remuneration is HK$960,000 per annum which was determined based on Mr. Zhang’s position in the Company.

−20 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

1. Mr. Fang Zhi Guo (“Mr. Fang”), age 42, has been an executive director of the Company since December 2001. He obtained his Bachelor’s degree in mechanical engineering from Tianjing University in July 1983 and his master’s degree in mechanical engineering from Tianjing Industrial University in December 1985. He became a lecturer and subsequently the Chair in the Mechanical Engineering faculty of Tianjin Industrial University between January 1986 and February 1995. Mr. Fang joined Greencool Refrigerant China as a director and Vice-President in 1995. He also became the Head of Greencool Refrigerent Research Institute. Mr. Fang has extensive experience in the manufacture and product design and development of refrigerants. He has an in-depth understanding in the research of the thermo-physical characteristics of Greencool refrigerants. He is also well-experienced in enterprise and scientific research management.

Mr. Fang entered into a service agreement with the Company. Mr. Fang’s remuneration is HK$960,000 per annum which was determined based on Mr. Fang’s position in the Company.

1. Mr. Chan Pei Cheong, Andy (“Mr. Chan”), age 43, MBA, FCCA, FHKSA, ACIS, HKICS, has been an independent non-executive director of the Company since December 2001. He has extensive experience in financial management, investment and corporate finance. Mr. Chan was a director in the corporate finance department of a merchant bank, and during his office, he was involved in corporate restructuring, takeovers and capital markets work. Concurrently, Mr. Chan also worked in an international firm of auditors and specialised in corporate auditing and financial management. In the 1990s, Mr. Chan also joined the Listing Division of the Stock Exchange of Hong Kong Limited as a manager. His duties included reviewing, coordinating and approving arrangements for listing of companies, initial public offering, issue of derivatives and share buy-backs. Mr. Chan holds a Master’s degree in Business Administration from the University of Durham, England and a diploma in accountancy with honours from the Lingnan University in Hong Kong. He is also a fellow of the Association of Chartered and Certified Accountants, Hong Kong Society of Accountants (now named the Hong Kong Institute of Certified Public Accountants), a fellow of the Institute of Chartered Secretaries and Administrators and the Hong Kong Institute of Company Secretaries. Mr. Chan is a certified practising accountant in Hong Kong and in the United Kingdom. Mr. Chan is currently a partner of an accounting firm in Hong Kong, and is an independent non-executive director of Rexcapital International Holdings Limited, a company listed on the Hong Kong Stock Exchange.

Mr. Chan entered into a service agreement with the Company. Mr. Chan’s remuneration is HK$360,000 per annum which was determined based on Mr. Chan’s position in the Company.

1. Mr. Li Kung Man (“Mr. Li”), age 47, has been an independent non-executive director of the Company since 2002. He has obtained a higher diploma from the Hong Kong Polytechnic University. He is also a fellow of The Chartered Association of Certified Accountants, United Kingdom and a member of the Hong Kong Society of Accountants (now named the Hong Kong Institute of Certified Public Accountants). He was an executive director of Mindun Group and Sunfore Group and he has extensive work experience in trading, manufacturing and property development. He was also engaged in accounting and auditing work with China Light & Power Co. Ltd. and PricewaterhouseCoopers. Mr Li is currently a director of Tak Wah Electronic Company Limited and an independent non-executive director of AKM Industrial Company Limited. Mr. Li has over twenty years of experience in the accounting field and working in business corporations. He also has a thorough understanding of financial management of companies (including China’s business environment).

Mr. Li entered into a service agreement with the Company. Mr. Li’s remuneration is HK$360,000 per annum which was determined based on Mr. Li’s position in the Company.

1. Mr. Xu Xiaolu (“Mr. Xu”) age 48, has been an independent non-executive director of the Company since 2003. He graduated in financial trading from Beijing Economics College. During 1982 and 1993, Mr. Xu took up various positions in the China National Petroleum Corporation (Petroleum Industrial Department), such as Head of Section, Deputy Head of Department and Head of Financial Department. From May 1993 to December 1999, Mr. Xu worked in CNPC (Hong Kong) Limited, during that time, Mr. Xu took up various positions such as executive director (1993-1996), Managing Director (1996-1997) and Vice-Chairman and President (1997-1999). Between 1999 to 2000, Mr. Xu joined PetroChina Company Limited as Assistant Secretary to the Board, the Company’s Authorised Representative in Hong Kong and Head of Investor Relations. During 2000 to 2003, Mr. Xu joined Sino InfoTech Holdings Limited as Managing Director. Since September 2003, Mr. Xu joined Beijing Fengde Investment Management Limited as a Chairman and Executive President.

Mr. Xu entered into a service agreement with the Company. Mr. Xu’s remuneration is HK$360,000 per annum which was determined based on Mr. Xu’s position in the Company.

−21 −

NOTICE OF EXTRAORDINARY GENERAL MEETING

1. Mr. Bai Yun Feng (“Mr. Bai”), age 42, has been a supervisor of the Company since 2002. He obtained his Bachelor’s degree in Automation from the Beijing Mechanical Engineering College. He then obtained a Master’s degree in Western Economics from Nan Kai University. Mr Bai previously worked as an engineer at the Beijing General Mechanical Research Institute, the Deputy Factory Director of Shenzhen Hua Mei Chemical Company Limited and the Deputy Head of China National Packaging Import and Export Corporation and the Senior Assistant to the President of Beijing Greencool Environmental. Mr. Bai currently works for Guangdong Kelon Air-conditioner Company Limited, a subsidiary of the Company, as Deputy General Manager.

Mr. Bai entered into a service agreement with the Company. Mr. Bai’s remuneration is RMB440,000 per annum which was determined based on Mr. Bai’s position in the Company.

1. Mr. Zeng Jun Hong (“Mr. Zeng”), age 31, graduated with a Master’s degree in Administration from the Beijing Graduate School of China University of Mining and Technology. In August 2001, Mr. Zeng joined Beijing Greencool Environmental as a project manager. In June 2002, Mr. Zeng became the assistant to the President of Jiangxi Greencool Enterprise Development Company Limited. In February 2004, he became the Deputy General Manager of Guangdong Kelon Fittings Company Limited. In July 2004, Mr. Zeng was appointed Chief Supervisor of the Company’s Procurement Centre.

Mr. Zeng entered into a service agreement with the Company. Mr. Zeng’s remuneration is RMB240,000 per annum which was determined based on Mr. Jiang’s position in the Company.

1. In accordance with the articles of association of the Company, the initial appointments for the directors, independent non-executive directors and supervisors will be for three years.

2. Save for Mr. Gu, none of the directors and supervisors is related to any director, senior management or substantial or controlling shareholders of the Company nor do they have any interests in shares of the Company within the meaning of Part XV of the Securities and Futures Ordinance. Mr. Gu is an executive director of the Company and is indirectly interested in 262,212,194 Legal Person Shares and 3,830,000 H Shares of the Company.

3. Greencool Enterprise Development owns 262,212,194 Legal Person Shares of the Company, representing 26.43% of the total issued share capital of the Company. Mr. Gu owns 60% interest of Greencool Enterprise Development.

4. Mr. Gu is a major shareholder, holding 62.5% of Greencool Tech, a company listed on the Hong Kong of Stock Exchange. Two of Greencool Tech’s subsidiaries own 3,830,000 H Shares issued by the Company, representing 0.39% of the total issued share capital of the Company.

5. The registered address of the Company is: No. 8 Ronggang Road, Ronggui Street, Shunde District, Foshan City, Guangdong Province.

Postal code: 528303 Tel: (86) 757 28362570 Fax: (86) 757 28361055 Contact person: Li Lin, Yu Wan Li

1. There are no other matters that need to be brought to the attention of the holders of securities of the Company in connection with the appointments.

As at the date of this notice, 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. Chan Pei Cheong, Andy, Mr. Li Kung Man and Mr. Xu Xiao Lu.

−22 −

NOTICE OF H SHAREHOLDERS EXTRAORDINARY GENERAL MEETING

GUANGDONG KELON ELECTRICAL HOLDINGS COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 921)

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting for holders of H shares of Guangdong Kelon Electrical Holdings Company Limited (the “Company”) will be held at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province on 15th January, 2005 at 10:30 a.m. for the purpose of considering, and, if thought fit, passing with or without amendment, the following resolution which will be proposed as a special resolution of the Company:

SPECIAL RESOLUTION

1. “ THAT

• (i) subject to sub-paragraph (ii) and (iii) of this resolution, the exercise by the directors of the Company during the Relevant Period (as hereinafter defined) of all powers of the Company to repurchase the overseas-listed foreign shares (“H shares”) in issue of the Company on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) or on any other stock exchange on which the securities of the Company may be listed and recognised by the Securities and Futures Commission and the Stock Exchange for this purpose, subject to and in accordance with all applicable laws, rules and regulations and/or requirements of the governmental or regulatory body of securities in the PRC, the Stock Exchange or any other stock exchange as amended from time to time, or of any other governmental or regulatory body be and is hereby generally and unconditionally approved;

• (ii) the aggregate nominal amount of the H Shares of the Company which the directors of the Company are authorised to repurchase pursuant to the approval in subparagraph (i) of this resolution shall not exceed 10 per cent. of the aggregate nominal amount of the H Shares of the Company in issue on the date of this resolution; and

• (iii) the approval in sub-paragraph (i) above shall be conditional upon:

• (a) the passing of a special resolution in the same terms as the resolution set out in this paragraph (except for this sub-paragraph (iii)(a) at (1) the extraordinary general meeting for all shareholders to be held on 15th January, 2005 (or on such adjourned date as may be applicable); and (2) the extraordinary general meeting for holders of domestic shares of the Company to be held on 15th January, 2005 (or on such adjourned date as may be applicable);

−23 −

NOTICE OF H SHAREHOLDERS EXTRAORDINARY GENERAL MEETING

• (b) the approvals of the regulatory authorities as required by the laws, rules and regulations of the PRC being obtained by the Company if appropriate; and

• (c) the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the notification procedure set out in Article 4.2 of the articles of association of the Company;

• (iv) for the purpose of this resolution:

“Relevant Period” means the period from the date of the passing of this resolution until whichever is the earliest of:

• (a) the conclusion of the next annual general meeting of the Company;

• (b) the expiration of a period of twelve months following the passing of this special resolution; or

• (c) the date on which the authority set out in this special resolution is revoked or varied by a special resolution of the shareholders of the Company in any general meeting; and

• (v) subject to approval of all relevant governmental authorities in the PRC for the repurchase of such H Shares being granted, the Board be hereby authorized to:

• (a) make such amendments to the articles of association accordingly as it thinks fit so as to reduce the registered share capital of the Company and to reflect the new capital structure of the Company upon the repurchase of H Shares of the Company as contemplated in paragraph (i) above; and

• (b) file the amended articles of association of the Company with the relevant government authorities of the PRC.”

By order of the Board of

Guangdong Kelon Electrical Holdings Company Limited Gu Chu Jun

Chairman

Foshan City, Guangdong, the PRC, 26th November, 2004

−24 −

NOTICE OF H SHAREHOLDERS EXTRAORDINARY GENERAL MEETING

Notes:

1. The register of members of the Company will be closed from 16th December, 2004 to 15th January, 2005, both days inclusive, during which period no share transfers will be registered. To qualify for attendance at the extraordinary general meeting, all transfers accompanied by the relevant share certificates must be lodged with the Company’s Branch Share Registrar in Hong Kong, Hong Kong Registrars Limited of Rooms 1712-1716, 17/F Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, no later than 4:00 p.m. on 15th December, 2004, for registration.

2. Shareholders intending to attend the H shareholders extraordinary general meeting shall give written notice of the same to the Company, which shall be lodged at the registered office of the Company on or before 4:00 p.m. on 24th December, 2004.

3. Shareholders entitled to attend and vote at the H shareholders extraordinary general meeting are entitled to appoint one or more persons (whether or not a shareholder of the Company) as their proxy to attend and vote on behalf of themselves.

4. In order to be valid, the form of proxy, together with a duly notarised power of attorney or other document of authority, if any, under which the form is signed must be deposited at the registered office of the Company not later than 24 hours before the time for holding the H shareholders extraordinary general meeting.

5. The registered address of the Company is: No. 8 Ronggang Road, Ronggui, Shunde District, Foshan City, Guangdong Province.

Postal code: 528303 Tel: (86) 757 28362570 Fax: (86) 757 28361055 Contact person: Li Lin, Yu Wan Li

As at the date of this notice, 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. Chan Pei Cheong, Andy, Mr. Li Kung Man and Mr. Xu Xiao Lu.

−25 −