Medlive Technology Co., Ltd. - Proxy Solicitation & Information Statement 2008

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about this circular, you should obtain independent professional advice.

If you have sold or transferred all your shares in HISENSE KELON ELECTRICAL HOLDINGS COMPANY LIMITED , you should at once hand this circular to the purchaser or transferee or to the bank, licensed securities dealer 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.

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)

CONTINUING CONNECTED TRANSACTIONS

REVISED ANNUAL CAPS FOR EXISTING CONTINUING CONNECTED TRANSACTIONS

Independent Financial Advisor to the Independent Board Committee and the Independent Shareholders

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A letter from the Board is set out from pages 4 to 10 of this circular.

A supplemental notice convening the EGM of the Company to be held on 26 August 2008 at 9:30 a.m. at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province, the PRC will be dispatched to the shareholders as soon as practicable.

11 July 2008

	Page
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Letter from the Independent Board Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
Letter from Access Capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
Appendix I — General Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23

— i —

DEFINITIONS

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

“A Shares” Domestic ordinary shares of the Company with a nominal value of RMB1.00 each and are listed on the Shenzhen Stock Exchange

“Access Capital”	Access Capital Limited, a corporation licensed under the
	SFO for carrying out type 1 (dealing in securities), type
	4 (advising on securities), type 6 (advising on corporate
	finance) and type 9 (asset management) regulated activities
	under the SFO, being the independent financial adviser to
	the Independent Board Committee and the Independent
	Shareholders in respect of the Supplemental Business Co-
	operation Framework Agreement
“Associate”	has the meaning ascribed to it in the Listing Rules
“Board”	the board of Directors
“Business Co-operation	the agreement entered into between the Company and
Framework Agreement”	Hisense Group and certain of its Subsidiaries dated 7
	January 2008 in connection with the sale and purchase
	of refrigerators, air-conditioners, raw materials, moulds
	and the provision of after-sale maintenance, repair and
	consultation services, electronic communication services
	and property management services
“Company”	Hisense Kelon Electrical Holdings Company Limited, a
	company incorporated in the PRC with limited liability
	and listed on the main board of the Stock Exchange and
	Shenzhen Stock Exchange
“EGM”	the extraordinary general meeting of the Company to be
	held on 26 August 2008 at 9:30 a.m., among other things,
	for the approval of the Supplemental Business Co-operation
	Framework Agreement
“Group”	the Company and its Subsidiaries
“Guangdong Greencool”	Guangdong Greencool Enterprise Development Company
	Limited

— 1 —

DEFINITIONS

“H Shares” overseas listed foreign shares of the Company with a nominal value of RMB1.00 each and are listed on the Stock Exchange
“Hisense Air-conditioning” Qingdao Hisense Air-Conditioning Co., Ltd (�� ), a subsidiary of Hisense Group
“Hisense Group” Hisense Group Company (��), a limited company incorporated in the PRC
“Hong Kong” the Hong Kong Special Administrative Region of the PRC “Independent Board an independent board committee of the Company Committee” comprising all the independent non-executive Directors, namely Mr. Zhang Sheng Ping, Mr. Lu Qing and Mr. Cheung Yui Kai, Warren
“Independent Shareholders” Shareholders other than those who are required under the Listing Rules to abstain from voting on the resolution to be proposed at the EGM to approve the Supplemental Business Co-operation Framework Agreement and the transactions contemplated thereunder
“Independent Third Parties” Third parties independent of and not connected with the Company and its connected persons, as defined in the Listing Rules, of the Company
“Latest Practicable Date” 11 July 2008, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular
“Listing Rules” Rules Governing the Listing of Securities on the Stock Exchange
“OEM” original equipment manufacturing, a type of manufacturing under which products are manufactured, in whole or in part, in accordance with specifications of the customer and are marketed and sold under the brand name of customer
“PRC” the People’s Republic of China

— 2 —

DEFINITIONS

Renminbi yuan, the lawful currency of the PRC

“RMB” Renminbi yuan, the lawful currency of the PRC “Share(s)” share(s) of RMB1.00 each in the capital of the Company, comprising the A Shares and the H Shares “Shareholder(s)” holders of the Shares “Stock Exchange” The Stock Exchange of Hong Kong Limited “Subsidiary” or “Subsidiaries” has the meaning defined in sections 2 and 2B of the Companies Ordinance (Cap. 32 of the Laws of Hong Kong)

“Supplemental Business the agreement entered into between the Company and Co-operation Framework certain Subsidiaries of Hisense Group dated 23 June 2008, Agreement” which supplements the Business Co-operation Framework Agreement

“White Goods” the general term by which white-coloured household electrical appliances are commonly known which include, but not limited to, air-conditioners and refrigerators

“%” per cent.

— 3 —

LETTER FROM THE BOARD

Directors: Registered Office: Mr. Tang Ye Guo No. 8 Ronggang Road Mr. Wang Shi Lei Ronggui Street Ms. Yu Shu Min Shunde District Mr. Lin Lan Foshan City Ms. Liu Chun Xin Guangdong Province Mr. Zhang Ming China

Independent non-executive Directors:

Independent non-executive Directors: Principal place of business Mr. Zhang Sheng Ping in Hong Kong: Mr. Lu Qing Room 3104-06 Mr. Cheung Yui Kai, Warren Singga Commercial Centre No. 148 Connaught Road West Hong Kong

11 July 2008

To the Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

Reference is made to the announcement and circular of the Company dated 7 January 2008 and 28 January 2008, respectively, relating to, among others, the continuing connected transactions under the Business Co-operation Framework Agreement dated 7 January 2008 entered into between the Company and Hisense Group and certain of its Subsidiaries.

In view of the increase of business co-operation between the Company and some of the Subsidiaries of Hisense Group, the Board announces that on 23 June 2008, the Company entered into the Supplemental Business Co-operation Framework Agreement with certain Subsidiaries of Hisense Group to revise the annual caps for the year ending 31 December 2008 for some of the transactions under the Business Co-operation Framework Agreement.

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LETTER FROM THE BOARD

Hisense Air-conditioning is a substantial shareholder of the Company, holding 23.63% of the issued share capital of the Company. Each of the Subsidiaries of Hisense Group, being the indirect holding company of Hisense Air-conditioning, is an Associate of Hisense AirConditioning, and therefore connected person of the Company. As such, the transactions contemplated under the Supplemental Business Co-operation Framework Agreement constitute continuing connected transactions of the Company under the Listing Rules and should be aggregated for the purpose of Rules 14A.25 to 14A.27 of the Listing Rules. Given that the applicable percentage ratios (other than the profit ratio) for the aggregated amount of the revised annual caps under the Supplemental Business Co-operation Framework Agreement is more than 2.5%, the continuing connected transactions with such revision of annual caps under the Supplemental Business Co-operation Framework Agreement are subject to reporting, announcement and independent shareholders’ approval requirements under Rule 14A.35 of the Listing Rules.

The purpose of this circular is to provide you with details of the Supplemental Business Cooperation Framework Agreement, to set out the recommendation of the Independent Board Committee and to set out the letter of advice from Access Capital to the Independent Board Committee and the Independent Shareholders in respect of the terms of the Supplemental Business Co-operation Framework Agreement.

SUPPLEMENTAL BUSINESS CO-OPERATION FRAMEWORK AGREEMENT

Date

23 June 2008

Parties

(i) The Company; and
(ii) certain Subsidiaries of Hisense Group.

— 5 —

LETTER FROM THE BOARD

Revision of annual caps

Under the Supplemental Business Co-operation Framework Agreement, the annual caps relating to the sale and supply of refrigerators, raw materials and components, purchase of refrigerators, air-conditioners and the provision of certain services under the Business Cooperation Framework Agreement shall be revised as follows:

Transaction Original annual amounts for Revised annual caps for the the five months caps for the year ending 31 ended 31 May year ending 31 December 2008 2008 December 2008 No. Transactions (RMB) (RMB) (RMB) 1. Sale and supply of refrigerators 100,000,000 35,700,000 250,000,000 by the relevant Subsidiaries of the Company to the relevant Subsidiaries of Hisense Group 2. Sale and supply of raw materials 92,100,000 32,200,000 125,300,000 and components by the relevant Subsidiaries of the Company to the relevant Subsidiaries of Hisense Group 3. Purchase of refrigerators by 210,000,000 125,100,000 365,000,000 the relevant Subsidiaries of the Company from the relevant Subsidiaries of Hisense Group 4. Purchase of air-conditioners 620,000,000 500,100,000 960,000,000 by the relevant Subsidiaries of the Company from the relevant Subsidiaries of Hisense Group

The above revised annual caps were determined with reference to (i) the rapid growth of domestic demand for home appliances, such as refrigerators and air-conditioners; (ii) the sales of electrical appliances of the Company boosted by the aforesaid factor in (i); (iii) the acceleration of product turnover and the enlargement of market share through OEM; and (iv) the original annual caps estimated at the beginning of the year not able to meet the current requirement of the business development of the Company.

— 6 —

LETTER FROM THE BOARD

The Company confirms that the transaction amounts under the Business Co-operation Framework Agreement for the period from 1 January 2008 to the Latest Practicable Date have not exceeded the original annual caps.

Save and except the revision of the annual caps as set out above, all other terms and conditions under the Business Co-operation Framework Agreement shall remain unchanged.

Condition

The Supplemental Business Co-operation Framework Agreement is subject to the approval of the independent shareholders at the EGM.

REASONS FOR THE REVISION OF THE ANNUAL CAPS

As a result of the continuous increase in the purchasing power of the residents in the PRC, their demand for home appliances such as refrigerators and air-conditioners, in particular those in towns and villages, also increases substantially. Meanwhile, the effect of global warming has also increased the consumption of refrigerating products. In view of the increase in demand for the products, the Company expects its sales of products and the relevant aftersale services to exceed its original expectation in the beginning of 2008 when the Business Co-operation Framework Agreement was entered into.

As the sales of White Goods are easily influenced by the change of climate, the peak seasons for White Goods are usually very short. All White Goods manufacturers are striving to seize the opportunities for sales within this short period of time, and delivery over a long distance will not help a company to speed up its response to market demand during these peak seasons. The parties to the Business Co-operation Framework Agreement are complementary to each other with respect to their respective geographic locations and distributions, and the co-operation arrangement can shorten the distance required to delivery the products to the customers and speed up their responses to market demand. The co-operation arrangement under the Business Co-operation Agreement are also beneficial to the Company and its Subsidiaries in sharing the fixed costs generated from their production of refrigerators and air-conditioners (Please refer to the announcement and circular of the Company dated 7 January 2008 and 28 January 2008 for details).

In light of the foregoing, it is expected that there will be an increase in the transaction amounts contemplated under the Business Co-operation Agreement during the peak seasons in the second half of 2008 and it is anticipated that the original annual caps under the Business Co-operation Agreement (which anticipated completion of the proposed acquisition referred to in the Company’s announcement and circular dated 28 December and 31 December 2007, respectively) will not be sufficient to cover the anticipated increase in the transaction amounts under the Business Co-operation Agreement.

— 7 —

LETTER FROM THE BOARD

Moreover, while the above annual caps relate to the broad category of sale and supply of refrigerators, raw materials and components, purchase of refrigerators, air-conditioners and the provision of certain services under the Business Co-operation Framework Agreement, the annual caps that the Company obtained pursuant to the relevant rules and regulations of the Shenzhen Stock Exchange relate to each category of transactions with each relevant Subsidiary of Hisense Group. As the actual transaction amounts for the five months ended 31 May 2008 are approaching certain original annual caps obtained under the relevant rules and regulations of Shenzhen Stock Exchange, the revision of annual caps thereof would require a corresponding revision of the annual caps for the broader categories referred to in this circular.

For the reasons stated above, the Company proposes to revise the original annual caps for certain transactions under the Business Co-operation Agreement. In view of the above, the Board considers that the revised annual caps under the Supplemental Business Co-operation Agreement are fair and reasonable and in the interests of the Shareholders and the Company as a whole.

INFORMATION RELATING TO THE COMPANY

The Company is principally engaged in the manufacture and sales of refrigerators and airconditioners.

INFORMATION ON HISENSE GROUP

Hisense Group Limited was incorporated in the PRC in 1979 with limited liability. It has a registered capital of RMB806,170,000. Its authorised representative is Zhou Hou Jian. Its registered address is 17 Donghai W Rd., Qingdao City. It is principally engaged in trust operation of state-owned assets; and the manufacturing and sale of TV set, DVD/ VCD player, hi-fi set, broadcasting and television equipment, air-conditioner, electronic computer, telephone set, communications product, network product and electronic products; the development of software; sale and after-sale services, technological development and consultancy, self-managed import & export trade with the items verified by the Ministry of Foreign Trade and Economic Cooperation (“MOFTEC”), Sino-foreign economic and technical co-operation with the items verified by MOFTEC.

— 8 —

LETTER FROM THE BOARD

LISTING RULES IMPLICATIONS

EGM

A supplemental notice of the EGM to be held at 9:30 a.m. on 26 August 2008 at the conference room of the Company’s head office, Shunde District, Foshan City, Guangdong Province, the PRC, at which relevant resolution will be proposed to approve, among other things, the Supplemental Business Co-operation Framework Agreement and the transactions contemplated thereunder, will be despatched to the shareholders as soon as practicable.

Pursuant to Rule 13.39(4) of the Listing Rules, the votes of Independent Shareholders taken at the EGM for the approval of the Supplemental Business Co-operation Framework Agreement and the transactions contemplated thereunder must be taken on poll.

Since Hisense Air-Conditioning is a Shareholder of the Company holding 23.63% of the issued share capital of the Company, it and its Associates have to be abstained from voting in relation to the approval of the Supplemental Business Co-operation Framework Agreement and the transactions contemplated thereunder.

In accordance with article 8.28 of the articles of association of the Company, 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.

— 9 —

LETTER FROM THE BOARD

RECOMMENDATION

Your attention is drawn to the advice of the Independent Board Committee set out in its letter on pages 11 to 12 of this circular which contains its recommendation to the Independent Shareholders on the terms of the Supplemental Business Co-operation Framework Agreement.

Your attention is also drawn to the letter of advice from Access Capital, which are set out on pages 13 to 22 in this circular, to the Independent Board Committee and the Independent Shareholders in respect of the terms of and the annual caps for the continuing connected transactions contemplated under the Supplemental Business Co-operation Framework Agreement.

ADDITONAL INFORMATION

Your attention is drawn to the general information of the Group as well as other information contained in the appendices to this circular before considering whether to vote for or against the resolution to be proposed at the EGM for approving the Supplemental Business Cooperation Framework Agreement as set out in the supplemental notice of the EGM.

SUSPENSION OF TRADING IN THE H SHARES OF THE COMPANY

At the request of the Company, trading in the H Shares of the Company was suspended from 28 April 2005 to 10 May 2005, and has remained suspended since 10:00 a.m. on 16 June 2005, initially following various press releases regarding the investigation by the China Securities and Regulatory Commission on Greencool Technology Holdings Limited in connection with the possible misappropriation of funds of the Company. Greencool Technology Holdings Limited was then an indirect shareholder of the Company controlled by Mr. Gu Chu Jun, who was the then executive director and chairman of the Company and the controlling shareholder of Guangdong Greencool Enterprise Development Company Limited, the then single largest shareholder of the Company.

The Company has reviewed the relevant documents in relation to the suspension of trading of the H Shares, the events leading to such suspension and the actions taken by the Company and has submitted a resumption proposal to the Stock Exchange for review. The Company received a letter from the Stock Exchange dated 5 June 2008 agreeing that trading in the H shares of the Company be allowed to resume subject to the fulfilment of the conditions as set out in its letter to the satisfaction of the Stock Exchange prior to the resumption of trading in the H shares of the Company. Please refer to the announcement of the Company dated 6 June 2008 for details of such conditions.

Yours faithfully,

By Order of the Board of

Hisense Kelon Electrical Holdings Company Limited

Tang Ye Guo

Chairman

— 10 —

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

11 July 2008

To the Independent Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

We refer to the circular issued by the Company to Shareholders dated 11 July 2008 (the “Circular”) of which this letter forms part. Terms defined in this Circular shall have the same meanings in this letter unless the context otherwise requires.

Under the Listing Rules, the entering into of the Supplemental Business Co-operation Framework Agreement constitutes continuing connected transactions for the Company and is thus subject to the approval of the Independent Shareholders at the EGM.

We have been appointed by the Board to consider the terms of the Supplemental Business Cooperation Framework Agreement and to advise the Independent Shareholders in connection with the Supplemental Business Co-operation Framework Agreement as to whether, in our opinion, its terms and its annual cap are fair and reasonable so far as the Independent Shareholders are concerned. Access Capital has been appointed as the independent financial adviser to advise us in this respect.

We wish to draw your attention to the letter from the Board and the letter from Access Capital as set out in this Circular. Having considered the principal factors and reasons considered by, and the advice of Access Capital as set out in its letter of advice, we consider that the Supplemental Business Co-operation Framework Agreement are on normal commercial terms and in the interest of the Company and the Shareholders as a whole.

We also consider that the Supplemental Business Co-operation Framework Agreement and its annual cap is fair and reasonable so far as the Independent Shareholders are concerned.

— 11 —

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Accordingly, we recommend the independent shareholders to vote in favour of the ordinary resolution to approve the Supplemental Business Co-operation Framework Agreement at the EGM.

Yours faithfully,

For and on behalf of the Independent Board Committee Zhang Sheng Ping Lu Qing Cheung Yui Kai, Warren Independent non-executive Directors Hisense Kelon Electrical Holdings Company Limited

— 12 —

LETTER FROM ACCESS CAPTIAL

Set out below is the full text of the letter of advice from Access Capital to the Independent Board Committee and the Independent Shareholders prepared for inclusion in this Circular.

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Suite 606, 6th Floor Bank of America Tower 12 Harcourt Road Central Hong Kong

11 July 2008

To the Independent Board Committee and

the Independent Shareholders of Hisense Kelon Electrical Holdings Company Limited

Dear Sirs,

CONTINUING CONNECTED TRANACTIONS

INTRODUCTION

We refer to our appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in respect of the Supplemental Business Cooperation Framework Agreement, details of which are set out in the circular to the Shareholders dated 11 July 2008 (the “Circular”), of which this letter forms part. This letter contains our advice to the Independent Board Committee and the Independent Shareholders in respect of the Supplemental Business Co-operation Framework Agreement. Unless otherwise stated, terms defined in the Circular have the same meanings in this letter.

On 23 June 2008, the Board announced that the Company entered into the Supplemental Business Co-operation Framework Agreement with certain Subsidiaries of Hisense Group to revise certain annual caps under the Business Co-operation Framework Agreement. The transactions contemplated under the Business Co-operation Framework Agreement dated 7 January 2008 entered into between the Company and certain Subsidiaries of Hisense Group have constituted continuing connected transactions (the “Continuing Connected Transactions”) of the Company under the Listing Rules and, together with the original annual caps, were approved by the Independent Shareholders at the extraordinary general meeting of the Company held on 15 February 2008.

— 13 —

LETTER FROM ACCESS CAPTIAL

As in the case of the Business Co-operation Framework Agreement, the transactions contemplated under the Supplemental Business Co-operation Framework Agreement constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules. Since the relevant percentage ratios as represented by the aggregate revised annual caps under the Supplemental Business Co-operation Framework Agreement for the year ending 31 December 2008 exceed 2.5% and the annual consideration is more than HK$10,000,000, such revision of annual caps under the Supplemental Business Co-operation Framework Agreement is subject to the reporting, announcement and independent shareholders’ approval requirements in accordance with Rule 14A.35 of the Listing Rules.

The Independent Board Committee, comprising all the independent non-executive Directors, has been formed to advise the Independent Shareholders as to whether the revision of the annual caps for the Continuing Connected Transactions is in the interests of the Company and the Shareholders as a whole, and the terms of the Supplemental Business Co-operation Framework Agreement including the proposed revised annual caps are fair and reasonable. As the independent financial adviser to the Independent Board Committee and the Independent Shareholders, our role is to give an independent opinion to the Independent Board Committee and the Independent Shareholders as to (i) whether or not the revision of the annual caps under the Supplemental Business Co-operation Framework Agreement is in the interests of the Company and the Shareholders as a whole; (ii) whether or not the terms of the Supplemental Business Co-operation Framework Agreement, including the proposed revised annual caps, are fair and reasonable; and (iii) how the Independent Shareholders should vote in respect of the resolution to approve the Supplemental Business Co-operation Framework Agreement and the revised annual caps at the EGM.

Apart from the normal advisory fee payable to us in connection with our appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders, no arrangement exists whereby we shall receive any other fees or benefits from the Company. We are independent of the Company for the purposes of Rule 13.84 of the Listing Rules.

BASIS OF OUR OPINION

In formulating our advice, we have relied solely on the statements, information, opinions and representations contained in the Circular and the information and representations provided to us by the Company and/or the Directors. We have assumed that all such statements, information, opinions and representations contained or referred to in the Circular or otherwise provided or made or given by the Company and/or its senior management staff and/or the Directors and for which it is/they are solely responsible were true and accurate and valid at the time they were made and given and continue to be true and valid as at the date of the Circular. We have assumed that all the opinions and representations made or provided by the Directors and/or the senior management staff of the Company contained in the Circular have been reasonably made after due and careful enquiry. We have also sought and obtained confirmation from the Company and/or its senior management staff and/or the Directors that no material facts have been omitted from the information provided and referred to in the Circular.

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LETTER FROM ACCESS CAPTIAL

We consider that we have reviewed all information and documents which are made available to us to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our advice. We have no reason to doubt the truth, accuracy and completeness of the statements, information, opinions and representations provided to us by the Company and/or its senior management staff and/or the Directors and their respective advisers or to believe that material information has been withheld or omitted from the information provided to us or referred to in the aforesaid documents. We have not, however, carried out any independent verification of the information provided, nor have we conducted any independent investigation into the business and affairs of the Group.

PRINCIPAL FACTORS CONSIDERED

In formulating our opinion regarding the Continuing Connected Transactions, we have taken into consideration the following principal factors:

I. Background information and reasons for the Supplemental Business Co-operation Framework Agreement

The principal activities of the Company and Hisense Group are similar and both include the design and manufacture of household electrical appliances including air-conditioners and refrigerators and the provision of related services. Given the keen competition in the white goods market in the PRC and in view of the substantial interest of Hisense Group in the Company, the Directors consider that there are business co-operation arrangements which can be beneficial to both the Company and Hisense Group in terms of the enhancement of the competitiveness of both sides as the respective Subsidiaries of the Company and Hisense Group are complementary to each other with respect to their geographic locations and distributions. Such co-operation arrangements can reduce the transportation time for product delivery and improve the market responsiveness for both sides. In addition, they can also help to reduce the idling capacity of the production facilities of the relevant parties so that there are more effective utilisations of the production fixed costs. Accordingly, in view of the anticipated benefits to be brought by the business co-operation between the Company and Hisense Group, the relevant parties entered into the Business Co-operation Framework Agreement on 7 January 2008, pursuant to which the Company conditionally agreed that it and any of its Subsidiaries might enter into certain transactions with the relevant Subsidiaries of Hisense Group in respect of the sale and supply of moulds, airconditioners, refrigerators, raw materials and components, the purchase of air-conditioners, refrigerators, raw materials, components and moulds, and the provision of property management services and after-sales maintenance, repair and consultation services.

Having constituted the non-exempt continuing connected transactions under the Listing Rules which were subject to the reporting, announcement and independent shareholders’ approval requirements, the transactions contemplated under the Business Co-operation Framework Agreement and the relevant annual caps were subsequently approved by the

— 15 —

LETTER FROM ACCESS CAPTIAL

Independent Shareholders at the extraordinary general meeting of the Company held on 15 February 2008. Since then, the Company and its Subsidiaries have conducted the Continuing Connected Transactions with Subsidiaries of Hisense Group in accordance with the terms and conditions of the Business Co-operation Framework Agreement.

As stated in the Letter from the Board, due to the continuous increase in the purchasing power of the residents in the PRC, their demand for home appliances such as refrigerators and air-conditioners, in particular those in towns and villages, also increases substantially. In addition, the effect of global warming has also increased the consumption of refrigerating products. In view of the increase in demand for such products, the Company expects its sales of products and the relevant after-sale services to exceed its original expectation in the beginning of 2008 when the Business Co-operation Framework Agreement was entered into. Accordingly, the Company expects that there will be an increase in the transaction amounts contemplated under the Business Co-operation Framework Agreement during the peak seasons in the second half of 2008 and anticipates that the existing annual caps (the “Existing Annual Caps”) under the Business Co-operation Framework Agreement will not be sufficient to cover the anticipated increases.

Furthermore, while the Existing Annual Caps relate to the broad category of sale and supply of refrigerators, raw materials and components, purchase of refrigerators, airconditioners and the provision of certain services under the Business Co-operation Framework Agreement, the annual caps that the Company obtained pursuant to the relevant rules and regulations of the Shenzhen Stock Exchange relate to each category of transactions with each relevant Subsidiary of Hisense Group. As the actual transaction amounts for the five months ended 31 May 2008 are approaching certain Existing Annual Caps obtained under the relevant rules and regulations of the Shenzhen Stock Exchange, the revision of annual caps thereof would require a corresponding revision of the annual caps for the relevant broader categories. In view of the aforesaid reasons, the Company proposes to revise certain Existing Annual Caps by way of the Supplemental Business Co-operation Framework Agreement. The Directors consider that the revised annual caps (the “Revised Annual Caps”) under the Supplemental Business Co-operation Framework Agreement are fair and reasonable and in the interests of the Shareholders and the Company as a whole.

We, having considered that (i) the Business Co-operation Framework Agreement and the Existing Annual Caps have already been formally approved by the Independent Shareholders pursuant to the relevant requirements of the Listing Rules; (ii) the Continuing Connected Transactions have been and will continue to be carried out by the Group in its ordinary and usual course of business and in accordance with the terms and conditions of the Business Co-operation Framework Agreement which are fair and reasonable and in the interests of the Company and the Shareholders as a whole; (iii) other than the revision of certain Existing Annual Caps as proposed under the Supplemental Business Cooperation Framework Agreement, the terms and conditions of the Business Co-operation

— 16 —

LETTER FROM ACCESS CAPTIAL

Framework Agreement will remain unchanged; and (iv) the actual transaction value of certain Continuing Connected Transactions for the five months ended 31 May 2008 have already accounted for a substantial proportion of the relevant Existing Annual Caps (further details of the actual transaction value for the five months ended 31 May 2008 are set out in the section headed “Rationale for determining the Revised Annual Caps” below), are of the view that the Supplemental Business Co-operation Framework Agreement is in the interests of the Company and the Shareholders as a whole.

II. Rationale for determining the Revised Annual Caps

Under the Supplemental Business Co-operation Framework Agreement, the Existing Annual Caps relating to the sale and supply of refrigerators, raw materials and components, purchase of refrigerators, air-conditioners and the provision of certain services under the Business Co-operation Framework Agreement shall be revised as follows:

	Existing Annual	Revised Annual
	Caps	Caps
	(RMB)	(RMB)
Maximum aggregate value of sale and supply of	100,000,000	250,000,000
refrigerators by the relevant Subsidiaries of
the Company to the relevant Subsidiaries of
Hisense Group
Maximum aggregate value of sale and supply of	92,100,000	125,300,000
raw materials and components by the relevant
Subsidiaries of the Company to the relevant
Subsidiaries of Hisense Group
Maximum aggregate value of purchase of	210,000,000	365,000,000
refrigerators by the relevant Subsidiaries of
the Company from the relevant Subsidiaries of
Hisense Group
Maximum aggregate value of purchase of air-	620,000,000	960,000,000
conditioners by the relevant Subsidiaries of
the Company from the relevant Subsidiaries of
Hisense Group

As stated in the Letter from the Board, the Revised Annual Caps were determined with reference to (i) the rapid growth of domestic demand for home appliances, such as refrigerators and air-conditioners; (ii) the sales of electrical appliances of the Company boosted by the aforesaid factor in (i); (iii) the acceleration of product turnover and the

— 17 —

LETTER FROM ACCESS CAPTIAL

enlargement of market share through OEM; and (iv) the original annual caps estimated at the beginning of the year not able to meet the current requirement of the business development of the Company.

For the purpose of evaluating the fairness and reasonableness of the aforesaid factors in determining the Revised Annual Caps and particularly the fact that they were arrived at after taking into account the expected increase in sales as boosted by the rapid growth of domestic demand for refrigerators and air-conditioners, we have reviewed certain independent statistical information in relation to the PRC market for refrigerators and air-conditioners. In particular, based on the information available from the website of the National Bureau of Statistics of China (中華人民共和國國家統計局), the total number of air-conditioners produced in China in 2007 was estimated to be approximately 80.1 million sets, representing an increase of approximately 17.0% from 2006. In addition, for the first five-month period of 2008, the total number of air-conditioners produced in China was estimated to be approximately 46.6 million sets, representing a growth rate of approximately 16.4% as compared with the output number for the corresponding period in 2007. On the other hand, the total number of refrigerators produced in China in 2007 was estimated to be approximately 44.0 million sets, representing an increase of approximately 24.5% from 2006. For the five-month period ended 31 May 2008, the total number of refrigerators produced in China was estimated to be approximately 21.0 million sets, representing a growth rate of approximately 13.5% as compared with the output number for the corresponding period in 2007. In light of the recent statistical information about the industry in general, we consider that it is appropriate and commercially sensible for the Directors to expect that the Company’s sales of electrical appliances will be boosted by the rapid growth of domestic demand for refrigerators and air-conditioners in China. Accordingly, we are of the view that it is fair and reasonable for the Directors to take into account such expectation in determining the Revised Annual Caps.

We have discussed with the management of the Company about the underlying assumptions, their basis as well as the projection of the relevant variables such as market share and product market price and we are of the view that such assumptions and basis are fair and reasonable. For the purpose of ensuring the accuracy of the computation of the Revised Annual Caps, we have also carried out a review on the relevant worksheets for calculation of the relevant annual caps including the review on the quantities and the unit prices of the subject items. Based on the result of our review, we are satisfied that the calculation of the proposed Revised Annual Caps has been conducted on a fair and reasonable basis.

For comparison among the actual transaction value of the relevant Continuing Connected Transactions, the Existing Annual Caps and the Revised Annual Caps, the following table sets out the respective percentages as represented by the actual transaction value of the relevant Continuing Connected Transactions for the five months ended 31 May 2008 over the Existing Annual Caps and the Revised Annual Caps.

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LETTER FROM ACCESS CAPTIAL

			Percentage		Percentage
			represented by		represented by
			the actual		the actual
	Actual		transaction		transaction
	transaction		value		value
	value for the		over the		over the
	five months		respective		respective
	ended	Existing	Existing	Revised	Revised
	31 May 2008	Annual Caps	Annual Caps	Annual Caps	Annual Caps
	(RMB)	(RMB)		(RMB)
Sale and supply of refrigerators	35,700,000	100,000,000	35.7%	250,000,000	14.3%
by the relevant Subsidiaries
of the Company to the
relevant Subsidiaries of
Hisense Group
Sale and supply of raw	32,200,000	92,100,000	35.0%	125,300,000	25.7%
materials and components by
the relevant Subsidiaries of
the Company to the relevant
Subsidiaries of Hisense
Group
Purchase of refrigerators by the	125,100,000	210,000,000	59.6%	365,000,000	34.3%
relevant Subsidiaries of the
Company from the relevant
Subsidiaries of Hisense
Group
Purchase of air-conditioners	500,100,000	620,000,000	80.7%	960,000,000	52.1%
by the relevant Subsidiaries
of the Company from the
relevant Subsidiaries of
Hisense Group

As set out in the above table, the actual transaction value of approximately RMB35.7 million for the sale and supply of refrigerators for the five months ended 31 May 2008 represents about 35.7% and 14.3% of the relevant Existing Annual Cap of RMB100 million and Revised Annual Cap of RMB250 million, respectively. As advised by the Company, while the actual transaction value for the sale and supply of refrigerators for the five months ended 31 May 2008 appears to be moderate and has accounted for only about 35% of the relevant Existing Annual Cap, such transaction value is expected to increase

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LETTER FROM ACCESS CAPTIAL

substantially during the peak season in the second half of 2008. We note that the Revised Annual Cap of RMB250 million represents a significant increase over the Existing Annual Cap of RMB100 million. However, as mentioned above, there was a substantial growth of approximately 24.5% in the total number of refrigerators produced in China in 2007 and for the first five-month period of 2008, the total number of refrigerators produced in China already amounted to about 21.0 million sets. Given such significant growth, we consider that it is commercially sensible and prudent for the Company to revise the value of the relevant Existing Annual Cap with a substantial increment. While the Revised Annual Cap of RMB250 million for the sale and supply of refrigerators for the year ending 31 December 2008 represents a substantial increase from the relevant Existing Annual Cap of RMB100 million, the revised number of refrigerators which are expected to be sold to the Subsidiaries of Hisense Group under the Business Co-operation Framework Agreement would still account for less than 1% of the expected total number of refrigerators to be produced in China in 2008. Accordingly, we are of the view that the Revised Annual Cap of RMB250 million for the sale and supply of refrigerators for the year ending 31 December 2008 is fair and reasonable.

As regards the actual transaction value for the sale and supply of raw materials and components for the five months ended 31 May 2008, such value of approximately RMB32.2 million represents about 35.0% and 25.7% of the relevant Existing Annual Cap of RMB92.1 million and Revised Annual Cap of RMB125.3 million, respectively. In the case of the sale and supply of raw materials and components, the Revised Annual Cap of RMB125.3 million represents an increase of about 36% over the relevant Existing Annual Cap of RMB92.1 million. Given the fact that the growth of the domestic market for home appliances such as air-conditioners and refrigerators in China has been substantial in recent period and such growth is expected to continue, the demand for the relevant materials and components is also expected to grow substantially. As such, we are of the view that the Revised Annual Cap of RMB125.3 million for the sale and supply of raw materials and components for the year ending 31 December 2008 is fair and reasonable.

In general, given the revenue nature of the aforesaid transactions, we are of the view that it is beneficial for the Company to maximise the relevant annual caps for such Continuing Connected Transactions. While the proposed Revised Annual Caps the year ending 2008 depend to significant extent on the estimation of sales by the relevant parties, it should be noted that (i) the transactions contemplated under the Supplement Business Co-operation Framework Agreement will continue to be conducted in the ordinary and usual course of business of the Company and on normal commercial terms and on terms not less favourable to the Company than terms available to or from (as appropriate) Independent Third Parties; (ii) the sale and supply of refrigerators, raw materials and components by the relevant Subsidiaries of the Company to the relevant Subsidiaries of Hisense Group, when take place and recognised by the relevant Subsidiaries of the Company as sales, will increase the Group’s overall revenue and profitability; and (iii) the non-exclusive arrangement under the Business Co-operation Framework Agreement provides the Company with the

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LETTER FROM ACCESS CAPTIAL

flexibility without any commitment on the actual transaction values. As such, we are of the view that the Revised Annual Caps with respect to the sale and supply of refrigerators, raw materials and components by the relevant Subsidiaries of the Company to the relevant Subsidiaries of Hisense Group are in the interests of the Company and the Shareholders as a whole.

As regards the purchase of refrigerators and air-conditioners by the relevant Subsidiaries of the Company from the relevant Subsidiaries of Hisense Group for the five months ended 31 May 2008, the actual transaction value for the purchase of refrigerators of approximately RMB125.1 million represents about 59.6% and 34.3% of the relevant Existing Annual Cap of RMB210 million and Revised Annual Cap of RMB365 million, respectively, whereas the actual transaction value for the purchase of air-conditioners of approximately RMB500.1 million represents about 80.7% and 52.1% of the relevant Existing Annual Cap of RMB620 million and Revised Annual Cap of RMB960 million, respectively. In view of the fact that such actual transaction value for the five months ended 31 May 2008 has already accounted for a substantial portion of the Existing Annual Caps for the year ending 31 December 2008, particularly in the case of the purchase of refrigerators, we concur with the Directors’ view that it is necessary to revise the relevant Existing Annual Caps so as to cover for the anticipated transaction value of such Continuing Connected Transactions under the revised estimation. Given the existing value of the relevant actual transactions for the five months ended 31 May 2008 and the fact that the growth of the domestic market for refrigerators and air-conditioners in China has been substantial and is expected to continue, we are of the view that the Revised Annual Cap of RMB365 million for the purchase of refrigerators and the Revised Annual Cap of RMB960 million for the purchase of air-conditioners by the relevant Subsidiaries of the Company from the relevant Subsidiaries of Hisense Group for the year ending 31 December 2008 are fair and reasonable.

III. Conditions of the Revised Annual Caps under the Supplemental Business Co-operation Framework Agreement

As in the case of the Existing Annul Caps under the Business Co-operation Framework Agreement, the Revised Annual Caps for the year ending 31 December 2008 will be subject to the annual review by the independent non-executive Directors, details of which must be included in the Company’s subsequent published annual report and accounts. Also, pursuant to the Listing Rules, the auditors of the Company must provide a letter to the Board confirming, among other things, that the transactions contemplated under the Business Co-operation Framework Agreement and the Supplemental Business Co-operation Framework Agreement are conducted in accordance with their terms and that the relevant annual caps not being exceeded. In addition, pursuant to the Listing Rules, the Company shall publish an announcement if it knows or has reason to believe that the independent non-executive Directors and/or its auditors will not be able to confirm the terms of such transactions or the relevant annual caps not being exceeded. We are of the view that there are appropriate measures in place to govern the conduct of the Continuing Connected Transactions and safeguard the interests of the Independent Shareholders.

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LETTER FROM ACCESS CAPTIAL

RECOMMENDATION

Based on the above, we are of the opinion that the transactions contemplated under the Supplemental Business Co-operation Framework Agreement are on normal commercial terms and in the ordinary and usual course of business of the Company and that the terms of the Supplemental Business Co-operation Framework Agreement and the Revised Annual Caps are in the interests of the Company and the Shareholders as a whole and fair and reasonable. Accordingly, we would advise the Independent Board Committee and the Independent Shareholders that the Independent Shareholders should vote in favour of the ordinary resolution to approve the Supplemental Business Co-operation Framework Agreement and the Revised Annual Caps at the EGM.

Yours faithfully, For and on behalf of Access Capital Limited Alexander Tai Principal Director

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GENERAL INFORMATION

APPENDIX I

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. All the Directors jointly and severally accept full responsibility for the accuracy of information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this circular have been arrived at after due and careful consideration and there are no other facts not contained in this circular, the omission of which would make any statement in this circular misleading.

2. DISCLOSURE OF INTERESTS

Directors, supervisors and chief executive of the Company

As at the Latest Practicable Date, none of the Directors, supervisors and chief executive of the Company had interests and short positions in the Shares, underlying Shares and/ or debentures (as the case may be) of the Company or any its associated corporations (within the meaning of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which any such Director or chief executive is taken or deemed to have under such provisions of the SFO) or which were required to be entered into the register required to be kept by the Company under section 352 of the SFO or which were otherwise required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers in the Listing Rules.

As at the Latest Practicable Date, none of the Directors or supervisors of the Company had any interest, direct or indirect, in any asset which have been since 31 December 2007, being the date to which the latest published audited financial statements of the Group were made up, acquired or disposed of by or leased to any member of the Group or are proposed to be acquired or disposed of by or leased to any member of the Group.

As at the Latest Practicable Date, none of the Directors or supervisors of the Company was materially interested in any contract or arrangement entered into by any member of the Group since 31 December 2007, being the date to which the latest published audited financial statements of the Company were made up, and which was significant in relation to the business of the Group.

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GENERAL INFORMATION

APPENDIX I

Interests of Substantial Shareholders

Interests in the Company

As at the Latest Practicable Date, so far as the Directors are aware, each of the following persons, not being a Director, supervisor or chief executive of the Company, had an interest in the Shares which falls to be disclosed to the Company and the Stock Exchange under the provisions of Division 2 and 3 of Part XV of the SFO:

			Proportion
			to the
			Relevant	Proportion
		Number	class of	to the total
		of issued	issued share	issued share
		ordinary	capital of the	capital of the
Name	Class of Shares	shares held	Company	Company
Hisense Air-	A Shares subject	234,375,922	78.57%	23.63%
conditioning	to selling
	restrictions
Foshan City Shunde	A shares subject	63,923,804	21.43%	6.44%
District Economic	to selling
Consultancy	restrictions
Company

Interests in other members of the Group

As at Latest Practicable Date, so far as the Directors are aware, the following persons, not being a Director, supervisor or chief executive of the Company, was directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other members of the Group:

		Percentage
		shareholding of
		shareholders in
	Shareholders holding 10% or more	other members
Other members of Group	in other members of the Group	of the Group
Guangdong Kelon Air-	Weishi Investments Company Limited	40%
Conditioner Co., Ltd
Guangdong Kelon Mould	Hua Yi Compressor Company Limited	29.89%
Co., Ltd

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GENERAL INFORMATION

APPENDIX I

		Percentage
		shareholding of
		shareholders in
	Shareholders holding 10% or more	other members
Other members of Group	in other members of the Group	of the Group
Foshan City Shunde	Hua Yi Compressor Company Limited	29.95%
District Rongsheng
Plastic Co., Ltd
Guangdong Huaao	Foshan City Shunde District Yun Long	30%
Electrical Electronics	Enquiry Service Company Limited
Co., Ltd.
Hisense Ronshen	Yingkou Yingleng (Group) Bankruptcy	14.74%
(Yingkou) Refrigerator	Liquidation Team
Co., Ltd.
Xi’an Kelon Cooling Co.,	Xi’an Gaoke (Group) Company Limited	29.05%
Ltd.
Jiangxi Kelon Combine	Jiangxi Fadasi Domestic Electrical	45%
Electrical Appliances	Appliances Company Limited
Co., Ltd.	（江西發達思家電有限公司）
Hua Yi Compressor	Sichuan Changhong Electric Holdings	29.92%
Company Limited	Co.�Ltd
	A-share public shareholders	49.05%
Chongqing Kelon	Chongqing Shang She Group	24%
Rongsheng Refrigerator
Sales Co., Ltd.	Chongqing Huaqing Commerce	24%
	Company
	Chongqing Department Building	24%

— 25 —

GENERAL INFORMATION

APPENDIX I

		Percentage
		shareholding of
		shareholders in
	Shareholders holding 10% or more	other members
Other members of Group	in other members of the Group	of the Group
Guangzhou Antaida	Guangzhou Zhongyuan International	30%
Logistic Co., Ltd.	Freight Forwarding Company
	Limited
	China Far Ocean Network Company	25%
	Limited
	Wuxi Small Swan Holdings Company	20%
	Limited
Wuhu Yingjia Electrical	Heavenly King Incorporated	20%
Machinery Co., Ltd.
Sichuan Rongsheng Kelon	Xu Wei Ru	24%
Refrigerator Sales Co.,
Ltd.
Beijing Hengsheng Xin	Foshan City Shunde District Yun Long	11%
Chuang Technology	Enquiry Service Company Limited
Company
Guangdong Kelon Weili	Zhongshan City Fusha Town	20%
Electrical Appliances	Shunchang Industry Limited
Company Limited	Company（中山市阜沙鎮順暢工業有
	限公司）

Save as disclosed above, as at the Latest Practicable Date and so far as is known to the Directors or chief executive of the Company, there was no other person (other than a Director, supervisor or chief executive of the Company or a member of the Group), who had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group.

— 26 —

GENERAL INFORMATION

APPENDIX I

3. SERVICE AGREEMENTS

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

4. COMPETING BUSINESS

As at the Latest Practicable Date, the following directors of the Company or their respective associates have interests in the following businesses which are considered to compete or are likely to compete, either directly or indirectly, with the businesses of the Group other than those businesses where the Directors were appointed as directors to represent the interests of the Company and/or the Group pursuant to the Listing Rules:

	Name of entity	Description of
	which business	business of the entity
	is considered to	which is considered
	compete or likely	to compete or likely	Nature of
	compete with the	to compete with the	interest of the
	business of the	business of the	Director in
Name of Director	Kelon Group	Kelon Group	the entity
Mr. Tang Ye Guo	Hisense Group or its	Production of air-	Director
	Subsidiaries	conditioning/
		electrical products
Ms. Yu Shu Min	Hisense Group or its	Production of air-	Director and/
	Subsidiaries	conditioning/	or senior
		electrical products	management
Mr. Wang Shi Lei	Hisense Group or its	Production of air-	Director and/
	Subsidiaries	conditioning/	or senior
		electrical products	management
Mr. Lin Lan	Hisense Group or its	Production of air-	Director and/
	Subsidiaries	conditioning/	or senior
		electrical products	management
Ms. Liu Chun Xin	The Subsidiaries of	Sales and marketing	Director
	Hisense Group	of electrical
		products
Mr. Zhang Ming	The Subsidiaries of	Production of air-	Director
	Hisense Group	conditioning/
		electrical products

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GENERAL INFORMATION

APPENDIX I

As at the Latest Practicable Date, save as disclosed above, none of the directors of the Company or their respective associates has interests in the businesses which compete or are likely to compete, either directly or indirectly, with the businesses of the Group.

5. NO MATERIAL ADVERSE CHANGE

At the Latest Practicable Date, none of the Directors was aware of any material adverse change in the financial or trading position of the Group since 31 December 2007 (being the date to which the latest published audited financial statements of the Group were made up).

6. EXPERT

(a) The following sets out the qualifications of the expert which has given its opinion or advice as contained in this circular:

Name

Qualifications

Access Capital
a corporation licensed under the SFO to conduct types 1 (dealing in securities), 4 (advising on securities), 6 (advising on corporate finance) and 9 (asset management) regulated activities under the SFO
(b) Access Capital does not have any shareholding, direct or indirect, in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.
(c) Access Capital does not have any interest, direct or indirect, in any assets which have been acquired or disposed of by or leased to any member of the Group, or which are proposed to be acquired or disposed of by or leased to any member of the Group since 31 December 2007, the date to which the latest published audited financial statements of the Company were made up.
(d) Access Capital has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which they are included.
(e) The letter and recommendation given by Access Capital are given as of the date of this circular for incorporation herein.

— 28 —

GENERAL INFORMATION

APPENDIX I

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the principal place of business in Hong Kong of the Company at Room 3104-06, Singga Commercial Centre, No. 148 Connaught Road West, Hong Kong during normal business hours from the date of this circular up and including 28 July 2008:

(a) the letter from Access Capital; and
(b) the Supplemental Business Co-operation Framework Agreement.

— 29 —

AI assistant

Medlive Technology Co., Ltd. — Proxy Solicitation & Information Statement 2008

50436_rns_2008-07-11_06c8b94d-7967-4ba3-baa1-0b31cc8743b3.pdf

CONTINUING CONNECTED TRANSACTIONS

REVISED ANNUAL CAPS FOR EXISTING CONTINUING CONNECTED TRANSACTIONS

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

LETTER FROM THE BOARD

SUPPLEMENTAL BUSINESS CO-OPERATION FRAMEWORK AGREEMENT

Date

Parties

Revision of annual caps

Condition

REASONS FOR THE REVISION OF THE ANNUAL CAPS

INFORMATION RELATING TO THE COMPANY

INFORMATION ON HISENSE GROUP

LISTING RULES IMPLICATIONS

EGM

RECOMMENDATION

ADDITONAL INFORMATION

SUSPENSION OF TRADING IN THE H SHARES OF THE COMPANY

CONTINUING CONNECTED TRANSACTIONS

CONTINUING CONNECTED TRANACTIONS

INTRODUCTION

BASIS OF OUR OPINION

LETTER FROM ACCESS CAPTIAL

PRINCIPAL FACTORS CONSIDERED

I. Background information and reasons for the Supplemental Business Co-operation Framework Agreement

LETTER FROM ACCESS CAPTIAL

II. Rationale for determining the Revised Annual Caps

LETTER FROM ACCESS CAPTIAL

III. Conditions of the Revised Annual Caps under the Supplemental Business Co-operation Framework Agreement

RECOMMENDATION

1. RESPONSIBILITY STATEMENT

2. DISCLOSURE OF INTERESTS

Directors, supervisors and chief executive of the Company

Interests of Substantial Shareholders

Interests in the Company

Interests in other members of the Group

3. SERVICE AGREEMENTS

4. COMPETING BUSINESS

5. NO MATERIAL ADVERSE CHANGE

6. EXPERT

Name

Qualifications

DOCUMENTS AVAILABLE FOR INSPECTION

More from Medlive Technology Co., Ltd.

Medlive Technology Co., Ltd. Proxy Solicitation & Information Statement 2008