Youzan Technology Limited — Capital/Financing Update 2001

Jun 20, 2001

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 howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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SYSCAN Technology Holdings Limited

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(Incorporated in Bermuda with limited liability)

ANNOUNCEMENT IN RELATION TO HAN’S LASER ACQUISITION

Further to the Announcement, the Company decided on 15th June, 2001 not to pursue further negotiation on the Further Acquisition as the Company was unable to reach an agreement with the Han’s Laser’s shareholders on the terms and conditions of the Further Acquisition.

The Group has signed the Repayment and Termination Agreement on 15th June, 2001 with the shareholders of Han’s Laser to terminate the 49% Acquisition as the condition of the 49% Acquisition has not being fulfilled. Under the Repayment and Termination Agreement, the shareholders of Han’s Laser shall be obliged to repay the amount of RMB26 million previously borrowed from the Group plus the amount of RMB4.3 million, being the agreed interest accrued and termination compensation to the Group, on or before 30th June, 2001. The shareholders of Han’s Laser shall be also obliged to refund RMB17 million to the Group, being deposit for the 49% Acquisition, on or before 30th June, 2001.

The Group has already received RMB15 million from the shareholders of Han’s Laser on 15th June, 2001 as a partial repayment of money borrowed from the Group.

The Group will make a further announcement on any further development on this matter.

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Further to the announcement made by the Company on 28th May, 2001 (the “Announcement”), the Board announces that the Company and its subsidiaries (together the “Group”) has not been able to reach an agreement with the Han’s Laser’s shareholders on the terms and conditions of the Further Acquisition, and the Group has decided on 15th June, 2001 not to pursue further negotiation on the Further Acquisition.

Unless otherwise defined herein, terms used in this announcement shall have the same meanings as defined in the Announcement.

In respect of the acquisition of the 49% equity interest in Han’s Laser by the Group ( the “49% Acquisition”) disclosed in the Group’s annual report for year ended 31st December, 2000, and in the Company’s First Quarterly Results for the three months ended 31st March, 2001 announced on 11th May, 2001, as well as in the Announcement, the condition of registering the Group as a shareholder of Han’s Laser through relevant government body of Shenzhen being a condition to the completion of the 49% Acquisition has not been fulfilled as of 15th June, 2001. After friendly negotiations, the Company has agreed with Han’s Laser’s shareholders on 15th June, 2001 to terminate the 49% Acquisition subject to, inter alia, the condition that Han’s Laser’s shareholders refunding RMB17 million, being deposit for the 49% Acquisition, to the Group on or before 30th June, 2001 (the “Repayment and Termination Agreement”).

Under the Repayment and Termination Agreement, Han’s Laser’s shareholders are also obliged to repay the amount of RMB26 million previously borrowed from the Group on 5th April, 2001 (which was used for financing the shareholders of Han’s Laser to acquire additional equity interest in Han’s Laser from an independent third party) plus the amount of RMB4.3 million, being the agreed interest accrued and termination compensation to the Group, on or before 30th June, 2001.

The net effect of termination of the 49% Acquisition and the Repayment and Termination Agreement to the Group is that the Group shall receive a net amount of RMB4.3 million. The Group has already received RMB15 million from the shareholders of Han’s Laser on 15th June, 2001 as a partial repayment of money borrowed from the Group.

The Group will make a further announcement on any further development on this matter.

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By Order of the Board Zhang Hongru Executive Director

Hong Kong, 19th June, 2001

This announcement, for which the directors (except for the non-executive director, Mr. Joseph Liu, who is not in Hong Kong and whom the Company has not been able to contact before the issue of this announcement; therefore Mr. Joseph Liu has not had the opportunity to review and verify the contents of this announcement and shall not be responsible for the contents of this announcement) of SYSCAN Technology Holdings Limited collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited for the purpose of giving information with regard to SYSCAN Technology Holdings Limited. The directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief: 1. the information contained in this announcement is accurate and complete in all material respects and not misleading; 2. there are no other matters the omission of which would make any statement in this announcement misleading; and 3. all opinions expressed in this announcement have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable.

This announcement will remain on the GEM website on the “Latest Company Announcements” page for 7 days from the date of its posting and on the Company’s website.

• For identification purposes only

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