Qiniu Limited — Capital/Financing Update 2004

May 17, 2004

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

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RONTEX INTERNATIONAL HOLDINGS LIMITED 朗迪國際控股有限公司[*]

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1142)

PROPOSED BONUS ISSUE OF WARRANTS AND PROPOSED AMENDMENTS TO ARTICLES OF ASSOCIATION

The Directors propose a bonus issue of Warrants on the basis of one bonus Warrant for every five existing Shares held. The Record Date is proposed to be 18 June 2004. To qualify for the Bonus Warrant Issue, any transfer of Shares must be lodged for registration by 4:00 p.m. on 14 June 2004. The book closure dates are from 15 June 2004 to 18 June 2004.

The Directors also propose to amend the Articles of Association to comply with Appendices 3 and 13 to the Listing Rules. The proposed amendments to the Articles of Association are subject to the approval of the Shareholders by way of special resolution at the EGM.

A circular containing details of the proposed Bonus Warrant Issue and particulars of the proposed amendments to the Articles of Association will be dispatched to the Shareholders as soon as practicable.

BONUS WARRANT ISSUE PROPOSAL

The Directors propose a bonus issue of warrants to be granted to Shareholders on the basis of one bonus Warrant for every five Shares held on the Record Date. Based on 1,602,208,000 Shares in issue as at the date of this announcement, Warrants carrying an aggregate subscription rights of HK$32,685,043.20 would fall to be issued pursuant to the proposed Bonus Warrant Issue. The Warrants will entitle the holders thereof to subscribe in cash for Shares at an initial subscription price of HK$0.102 per Share (subject to adjustment) during the period from the date of issue (which is expected to be 28 June 2004) to the date of expiry of one year from the date of issue (both days inclusive).

Subscription Price

The initial subscription price of HK$0.102 represents a discount of approximately 17.07 per cent. to the closing price of HK$0.123 of the Shares on 17 May 2004 as quoted on the Stock Exchange. The initial subscription price also represents a discount of approximately 28.17 per cent. to the average closing price of HK$0.142 of the Shares as quoted on the Stock Exchange for the last 5 trading days prior to and including 17 May 2004.

* For identification purpose only

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Number of Warrants to be issued

Full exercise of the Warrants at the initial subscription price of HK$0.102 per Share would result in the issue of a total of 320,441,600 new Shares (based on the 1,602,208,000 Shares in issue as at the date of this Announcement and on the assumption that no new Shares would be issued and no further Shares are repurchased prior to the Record Date), representing approximately 20 per cent. of the Company’s existing issued share capital and approximately 16.67 per cent. of the issued share capital of the Company as enlarged by the allotment and issue of the Shares upon full exercise of the Warrants. Save and except for 47,904,000 share options granted under the share option scheme adopted by the Company on 19 October 2002, there are no other outstanding securities of the Company in issue as at the date of this Announcement.

Board lot

The proposed board lot size of the Warrants is 50,000 units. Each board lot of Warrants will entitle the holder(s) thereof to subscribe for 50,000 new Shares at an aggregate subscription price of HK$5,100 (based on the initial price of HK$0.102 per Share), subject to adjustments.

Closure of register of members

In order to qualify for the proposed Bonus Warrant Issue, all transfers of Shares must be duly completed, accompanied by the relevant Share certificates and lodged with the Company’s branch share registrars in Hong Kong, Tengis Limited of Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong not later than 4:00 p.m. on 14 June 2004.

The register of members will be closed from 15 June 2004 to 18 June 2004, both days inclusive. No transfer of Shares will be registered during this period.

Overseas Shareholders

The issue of Warrants has not been and will not be registered under the applicable securities legislation of any jurisdiction other than Hong Kong and the Directors are of the view that, in the absence of compliance with registration or other special formalities in such other territories, the issue of Warrants to Overseas Shareholders would or might be unlawful or impracticable. Having made due enquiries with the Company’s branch share registrars in Hong Kong, the Directors confirm that as at the trading date immediately preceding the date of this announcement, the Company does not have any Overseas Shareholders. As it is not predictable whether the Company will have any Overseas Shareholders on the Record Date and no particular country can be identified at this stage, the Directors also consider that it would be impracticable, unduly burdensome and costly, and would not be in the best interests of the Shareholders and the Company as a whole to comply with all applicable securities legislation in the world. Accordingly, no allotment of Warrants will be made to Overseas Shareholders under the proposed Bonus Warrant Issue. However, arrangements will be made for the Warrants which would otherwise have been issued to Overseas Shareholders to be sold in the market as soon as practicable after dealings commence, if a premium, net of expenses, can be obtained. Any net proceeds of such sale for each Overseas Shareholder, after deduction of expenses, will be distributed in Hong Kong dollars pro rata to the relevant Overseas Shareholder and the remittances thereof will be posted to him, at his own risk, unless the amount falling to the distributed to any such person is less than HK$100.00 in which case it will be retained for the benefit of the Company.

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Conditions of the proposed Bonus Warrant Issue

The proposed Bonus Warrant Issue will be conditional upon:

• a) the approval of Shareholders at the EGM of the Company proposed to be held on 18 June 2004 in respect of, inter alia, the proposed Bonus Warrant Issue and the issue and allotment of Shares to any holders of the warrants pursuant to the due exercise of the subscription rights attaching to the Warrant; and

• b) the Listing Committee of the Stock Exchange granting the listing of and permission to deal in the Warrants and any new Shares which may fall to be issued upon the exercise of the subscription rights attaching to the Warrants.

Reasons for the proposed Bonus Warrant Issue

The Directors believe that the proposed Bonus Warrant Issue will provide Shareholders with an opportunity to obtain further equity participation in the Company on more favourable terms, thereby enlarging the Company’s shareholder and capital base.

The gross proceeds of the proposed Bonus Warrant Issue, if fully subscribed, will be approximately HK$32,685,043.20. The Company intends to apply any subscription moneys received (after deduction of all necessary expenses) as and when the subscription rights attaching to the Warrants are exercised towards the general working capital of the Group depending on its requirements at the relevant time. The Company currently does not have any specific plan as to the use of proceeds from the Bonus Warrant Issue.

Accordingly, the Directors believe that the Bonus Warrant Issue is beneficial to the Company and the Shareholders as a whole.

Applications for listing

Applications will be made to the Listing Committee of the Stock Exchange for the listing of and permission to deal in the Warrants and any Shares which may fall to be issued upon the exercise of the subscription rights attaching to the Warrants.

Status of Shares to be issued upon exercise of Warrants

Shares which are allotted and issued on the exercise of the subscription rights attaching to the Warrants will rank pari passu in all respects with the Shares in issue on the date of such allotment and issue.

Fractions of Warrant

Fractional entitlements to Warrants will not be granted but will be aggregated and issued to a nominee to be nominated by the Directors. Such Warrants (if any) will be sold and the net proceeds thereof (if any) will be retained by the Company for its own benefits.

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Certificates for the Warrants

Subject to the conditions being satisfied, certificates for the Warrants are expected to be despatched to the Shareholders by ordinary post on or about 28 June 2004 at their own risk. Dealings in the Warrants are expected to commence on 30 June 2004.

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

In order to comply with the recent amendments made to the Listing Rules, the Directors also propose to amend the Articles of Association to comply with Appendices 3 and 13 to the Listing Rules.

The proposed amendments to the Articles of Association are subject to the approval of the Shareholders by way of special resolution at the EGM.

CIRCULAR TO SHAREHOLDERS AND EGM

The EGM is proposed to be convened on 18 June 2004 at which resolutions will be proposed to approve the proposed Bonus Warrant Issue and the proposed amendments to the Articles of Association. A circular containing details of the proposed Bonus Warrant Issue and particulars of the proposed amendments to the Articles of Association together with a notice convening the EGM will be despatched to Shareholders as soon as practicable after this announcement.

EXPECTED TIMETABLE FOR THE PROPOSED BONUS WARRANT ISSUE

2004

Last day of dealings in Shares cum entitlements

to the Bonus Warrant Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thursday, 10 June First day for dealings in Shares ex-entitlements

to the Bonus Warrant Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 11 June Latest time for lodging transfers of Shares for entitlements

to the Bonus Warrant Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Monday, 14 June Closure of the register of members (both days inclusive) from . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 15 June to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 18 June Latest time for lodging forms of proxy for EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11:00 a.m. on Wednesday, 16 June EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11:00 a.m. on Friday, 18 June Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 18 June Despatch of the Warrant certificates on or before . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 28 June Commencement of dealings in the Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 30 June

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DEFINITIONS

“Articles of Association”	the articles of association of the Company;
“Bonus Warrant Issue”	the conditional bonus issue of Warrants by the Company to Shareholders
	(other than Overseas Shareholders) as described in this announcement;
“Company”	Rontex International Holdings Limited, a company incorporated in the
	Cayman Islands with limited liability, the Shares of which are listed on
	the Main Board of the Stock Exchange;
“Directors”	the directors of the Company;
“EGM”	the extraordinary general meeting of the Company proposed to be
	convened and held at 24th Floor, Chun Wo Commercial Centre, 23, 25,
	27 and 29 Wing Wo Street, Central, Hong Kong on 18 June 2004 at
	11:00 a.m. and any adjournment thereof;
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange;
“Overseas Shareholders”	Shareholders whose addresses as shown on the register of members on
	the Record Date are outside Hong Kong;
“Record Date”	18 June 2004, being the date for determination of entitlements to the
	Bonus Warrant Issue;
“Shareholders”	holders of Shares;
“Shares”	shares of HK$0.01 each in the share capital of the Company;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited; and
“Warrant(s)”	warrant(s) to be constituted by an instrument by way of deed poll to be
	executed by the Company and to be issued by the Company under the
	Bonus Warrant Issue entitling the holders to subscribe up to an aggregate
	of 320,441,600 Shares at an initial subscription price of HK$0.102 per
	Share (subject to adjustments).

As at the date of this announcement, the board of Directors comprises three executive Directors namely Mr. Cheung Keng Ching, Madam Chou Mei, Mr. Lau Ka Man Kevin and two independent non-executive Directors namely, Mr. Chow Chi Kit and Mr. To Yan Ming Edmond.

By Order of the Board RONTEX INTERNATIONAL HOLDINGS LIMITED Cheung Keng Ching Chairman

Hong Kong, 17 May 2004

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

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