Rego Interactive Co., Ltd — Capital/Financing Update 2005

Aug 2, 2005

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

(Stock code: 1065)

Announcement relating to the Sale Back of A Shares Convertible Bonds of the Company

This announcement is made pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

Tianjin Capital Environmental Protection Company Limited (the “Company”) and all members of the board (the “Board”) of directors (the “Directors”) of the Company warrant that the content of this announcement is true, accurate and complete, and assume joint responsibility on any false record, misrepresentation or material omission as set out herein.

Highlights:

• Sale Back Code: 100900

• Sale Back short name: Tianjin Sale Back

• Sale Back Price: RMB102/A Share Convertible Bond (the “A Share Convertible Bond”) of the Company

• Exercise Period: 5th August 2005 to 11th August 2005

• Sale Back Payment Date: 16th August 2005

The average closing price of the Company’s A shares (the “A Shares”) in the 20 consecutive trading days from 1st July 2005 to 28th July 2005 has been lower than 70% of the current conversion price (the “Conversion Price”) of the A Share Convertible Bonds. As provided under the “Prospectus relating to the Issue of the A Share Convertible Bonds” (the “Prospectus”), the provision in relation to the exercise of the sale back (the “Sale Back”) to sell all or part of the A Share Convertible Bonds to the Company has become effective. Pursuant to the “Implementation Method of the Issue of Convertible Bonds by Listed Companies” and the “Rules Governing the Listing of Securities on the Shanghai Stock Exchange”, the relevant matters on the Sale Back are hereby announced as follows:

I. Terms of the Sale Back

• (1) Conditions and price of the Sale Back

The Prospectus provided that during the conversion period of the A Share Convertible Bonds, if the average closing price of the A Shares in any 20 consecutive trading days is lower than 70% of the current Conversion Price, holders of the A Share Convertible Bonds shall be entitled to sell back all or part of their A Share Convertible Bonds to the Company at 102%, 103%, 104% and

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105% of the nominal value of the A Share Convertible Bonds for the A Share Convertible Bonds which held for one full year, two full years, three full years and four full years respectively (“the Sale Back Price”). Holders of the A Share Convertible Bonds are entitled to exercise the Sale Back once in every interest accruing year (the “Exercise Period”) pursuant to the terms as provided in the Prospectus. In any interest accruing year, upon the initial satisfaction of the conditions for the Sale Back (the “Sale Back Conditions”), holders of the A Share Convertible Bonds may exercise the Sale Back. No Sale Back shall be further exercised if they are not exercised upon initial satisfaction of the Sale Back Conditions in that interest accruing year.

The Sale Back Price for the Sale Back shall be 102% of the nominal value of the A Share Convertible Bonds, i.e. RMB102/A Share Convertible Bond.

The rights of the holders of the A Share Convertible Bonds who do not exercise the Sale Back within the Exercise Period shall be deemed as unconditionally waived.

• (2) Procedures and payment method of the Sale Back

  1. Notice period of the Sale Back

The Company will publish three Sale Back notices on the Shanghai Securities Journal, Hong Kong Wen Wei Po and The Standard, and on the websites of the Shanghai Stock Exchange (http://www.sse.com.cn) and The Stock Exchange of Hong Kong Limited (http://www.hkex.com.hk) respectively within five working days after the terms for exercising the Sale Back become effective (i.e. from 29th July 2005 to 4th August 2005).

1. Reporting period of the Sale Back

The Sale Back code is “100900”, and the Sale Back short name is “Tianjin Sale Back”.

Holders of the A Share Convertible Bonds who desire to exercise the Sale Back, shall exercise the Sale Back within five working days after the expiry of the Sale Back notice period through the trading system of the Shanghai Stock Exchange (i.e. from 5th August 2005 to 11th August 2005). The purpose of exercise is to sell, and the board lot for the exercise of Sale Back on the Convertible Bonds shall be in multiples of the nominal value of RMB1,000. Once the application is confirmed, the exercise of Sale Back shall be irrevocable.

If the Sale Back is not exercised successfully on the date of application, the Sale Back can still be exercised on the following day until the end of the Exercise Period.

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3. Method of payment

The Company will buyback the A Share Convertible Bonds tendered for repurchase at the Sale Back Price. The Company has assigned the Shanghai Branch of China Securities Depository and Clearing Corporation Limited to conduct the clearing and settlement procedures through its capital clearing system in accordance with the relevant business rules of the Shanghai Branch of China Securities Depository and Clearing Corporation Limited. The payment date for the A Share Convertible Bonds (the “Sale Back Payment Date”) is 16th August 2005.

Upon the expiry of the Exercise Period, the Company will announce the results of the Sale Back and the effect of the Sale Back to the Company.

II. Transaction during the Exercise Period

Conversion of the A Share Convertible Bonds shall be suspended during the Exercise Period, but trading in the A Share Convertible Bonds will continue within the Exercise Period. If a holder of the A Share Convertible Bond gives a sell instruction and exercises the Sale Back simultaneously on the same trading day, the system will deal with the sell instruction first.

From the expiry of the Exercise Period up to the date prior to the issue of announcement on the results of the exercise of the Sale Back, trading in the A Shares, the A Share Convertible Bonds and the conversion of A Share Convertible Bonds shall be suspended.

III. Others

Holders of A Share Convertible Bonds may sell back all or part of the outstanding A Share Convertible Bonds to the Company by exercising the Sale Back. Holders of A Share Convertible Bonds are entitled to choose whether they shall exercise the Sale Back. Exercise of the Sale Back is not mandatory.

IV. Means of contact

Contact department: Office of Secretary to the Board, Tianjin Capital Environmental Protection Company Limited Address: TCEP Building, 76 Weijin South Road, Nankai District, Tianjin, the People’s Republic of China (the “PRC”) Postal Code: 300381 Tel. No.: 8622-23930128 Fax No.: 8622-23930126

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As at the date of this announcement, the Board comprises executive Directors: Ms. Ma Baiyu, Mr. An Pindong, Mr. Gu Qifeng, Mr. Wang Zhanying, Mr. Tan Zhaofu and Ms. Fu Yana, and independent non-executive Directors: Mr Wang Xiangfei, Mr. Gao Zongze and Mr. Ko Poming.

By order of the Board Ma Baiyu Chairman

Tianjin, the PRC 1st August 2005

Please also refer to the published version of this announcement in The Standard.

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