Zhongguancun Science-Tech Leasing Co., Ltd. — Proxy Solicitation & Information Statement 2002

Nov 28, 2002

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular, you should consult your stockbroker or other registered dealer in securities, a bank manager, solicitor, professional accountant or other professional adviser.

If you have sold all your shares in Great Wall Cybertech Limited, you should at once hand this circular to the purchaser or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser.

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.

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GREAT WALL CYBERTECH LIMITED

(incorporated in Bermuda with limited liability)

Executive Directors: Wu Shaozhang (Chairman) Wong Kwok Wing (Vice Chairman & Managing Director) Tse On Kin (Vice Chairman & Chief Executive Officer) Yuen Chung Yan, John Chen Weixiong Lee Muk Sang (resigned on 1 February 2002) Weon Du Ho (resigned on 14 May 2002) Lau Tat Hong, Andrew (resigned on 16 September 2001)

Independent Non-Executive Directors: Lee Shue Shing Wong Ying Ho, Kennedy (resigned on 2 July 2002) Wu Xiaoke (appointed on 14 August 2002)

Registered Office: Cedar House 41 Cedar Avenue Hamilton HM12 Bermuda

Principal Office: 19th Floor Chinachem Century Tower 178 Gloucester Road Wanchai Hong Kong

15 October 2002

To the shareholders

Dear Sir or Madam,

PROPOSALS FOR GENERAL MANDATE TO ISSUE SHARES AND GENERAL MANDATE TO REPURCHASE SHARES

INTRODUCTION

It is proposed that at the annual general meeting of Great Wall Cybertech Limited (the “Company”) convened to be held on 29 November 2002 (the “Annual General Meeting”) ordinary resolutions will be proposed to grant to the directors of the Company (the “Directors”) a general mandate to issue shares of the Company and a general mandate to repurchase shares of the Company.

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The purpose of this circular is to provide shareholders of the Company (the “Shareholders”) with information reasonably necessary to enable them to make an informed decision on whether to vote for or against the resolutions proposed.

GENERAL MANDATE TO ISSUE SHARES

At the Annual General Meeting, two ordinary resolutions will be proposed that the Directors be given a general mandate to exercise all powers of the Company to issue, allot and deal with additional shares in the capital of the Company. Under such mandate, the number of shares that the Company may issue will be up to a maximum of 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue on the date of passing such resolution plus the nominal amount of any shares repurchased.

The mandate allows the Company to issue, allot and deal with additional shares in the capital of the Company only during the period ending on the earlier of the date of the conclusion of the next annual general meeting, the expiration of the period within which the next annual general meeting of the Company is required to be held by law and the date upon which such mandate is revoked or varied by an ordinary resolution of the Company in general meeting.

GENERAL MANDATE TO REPURCHASE SHARES

At the Annual General Meeting, an ordinary resolution will be proposed that the Directors be given a general mandate to exercise all powers of the Company to repurchase issued and fully paid shares in the capital of the Company. Under such mandate, the number of shares that the Company may repurchase will be up to a maximum of 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue on the date of passing such resolution. The Company’s authority is restricted to repurchases made on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”). On 15 October 2002, being the latest practicable date prior to printing of this circular (“Latest Practicable Date”), there were in issue an aggregate of 8,076,257,020 shares of HK$0.01 each in the Company (the “Shares”). Exercise in full of the mandate, on the basis that no further Shares are issued and no repurchase of Shares is made prior to the date of the Annual General Meeting, could accordingly result in up to 807,625,702 Shares being repurchased by the Company.

The mandate allows the Company to make repurchases only during the period ending on the earlier of the date of the conclusion of the next annual general meeting, the expiration of the period within which the next annual general meeting of the Company is required to be held by law and the date upon which such mandate is revoked or varied by an ordinary resolution of the Company in general meeting.

The Directors have no present intention to repurchase any Shares but consider that the mandate will provide the Company with the flexibility to make such repurchases when appropriate and beneficial to the Company. Such repurchases may enhance the net asset value per Share and/or earnings per Share.

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RECOMMENDATION

The Directors consider that the proposed grant to the Directors of a general mandate to issue shares and a general mandate to repurchase Shares are in the interest of the Company and shareholders and accordingly recommend you to vote in favour of the resolutions at the forthcoming Annual General Meeting. The Directors will vote all their shareholdings in favour of the resolutions.

Yours faithfully, Wu Shaozhang Chairman

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APPENDIX EXPLANATORY STATEMENT ON THE REPURCHASE MANDATE

The following is an explanatory statement which is being given in compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”).

LISTING RULES RELATING TO REPURCHASES OF SECURITIES

The Listing Rules permit companies whose primary listings are on the Stock Exchange to repurchase their securities on the Stock Exchange subject to certain restrictions, the more important of which are summarised below.

(a) Shareholders approval

The Listing Rules provide that all securities repurchases on the Stock Exchange by a company with its primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, which may be by way of general mandate, or with reference to a specific transaction.

(b) Source of funds

Repurchase must be funded out of funds legally available for the purpose, including capital paid up on the Shares to be repurchased, funds of the company otherwise available for dividend or distribution and in the case of any premium payable on repurchase, out of sums standing to the share premium account of the company.

(c) Trading restrictions

A maximum of 10 per cent. of the outstanding share capital of a company as at the date of passing relevant resolutions may be repurchased on the Stock Exchange and a company may not issue or propose to issue new securities for a period of 30 days immediately following a securities repurchase (other than an issue of securities pursuant to the exercise of warrants, share options or similar instruments requiring the company to issue securities which were outstanding prior to that purchase of its own securities), without the prior approval of the Stock Exchange. In addition, all securities repurchases on the Stock Exchange in any given calendar month are limited to a maximum of 25 per cent. of the trading volume of the company’s securities in the immediate preceding calendar month. The Listing Rules prohibit securities repurchases on the Stock Exchange at any time after a price sensitive development has occurred or has been the subject of a decision until such time as the price sensitive information is made publicly available. In particular, during the period of one month immediately preceding either the preliminary announcement of the company’s annual results or the publication of the company’s interim report, the company may not repurchase securities on the Stock Exchange. The Listing Rules also prohibit a company from making repurchases on the Stock Exchange

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if the result of the repurchase would be that less than 25 per cent. (or such other prescribed minimum percentage as determined by the Stock Exchange) of any class of the listed securities of the company would be in the public hands. A company shall not repurchase 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.

(d) Status of repurchased securities

The Listing Rules provide that the listing on the Stock Exchange of all repurchased securities shall be automatically cancelled, irrespective of whether or not such repurchase took place on the Stock Exchange and that the relevant certificates for the securities must be cancelled and destroyed as soon as reasonably practicable following settlement of any such repurchase. Under Bermuda law, the shares so repurchased are required to be treated as cancelled but the aggregate amount of authorised share capital will not be reduced.

(e) Suspension of repurchases

The Stock Exchange reserves the right to suspend a company’s right to repurchase securities on the Stock Exchange if the company is in breach of the Listing Rules.

(f) Reporting requirements

Under the Listing Rules, securities repurchases on the Stock Exchange or otherwise must be reported to the Stock Exchange no later than 9:00 a.m. (Hong Kong time) on the following business day. In addition, the company’s annual report is required to disclose details regarding securities repurchases made during the year, including the number of securities repurchased and the aggregate price paid. A company is required to procure that any broker appointed by it to effect a repurchase of securities shall disclose to the Stock Exchange such information with respect to the repurchase made on behalf of the company as the Stock Exchange may request.

(g) Connected parties

The Listing Rules prohibit a company from knowingly purchasing its own securities on the Stock Exchange, from a connected person (as defined in the Listing Rules) and a connected person is prohibited from knowingly selling his securities to his company on the Stock Exchange.

EFFECT OF HONG KONG CODE ON TAKEOVERS AND MERGERS

A repurchase of Shares by the Company may result in an increase in the proportionate interest of a substantial shareholder of the Company in the voting rights of the Company, which could give rise to an obligation to make a mandatory offer under Rule 26 of the Hong Kong Code on Takeovers and Mergers (the “Code”).

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As at the Latest Practicable Date, Vandor Profits Limited (“Vandor”) was the substantial shareholder holding more than 10 per cent. of the issued share capital of the Company, which held approximately 30.10 per cent. of the issued share capital of the Company. In the event that the Directors should exercise in full the power of Shares repurchase which is proposed to be granted pursuant to the general mandate, and the Shares are not repurchased from Vandor, the shareholding of Vandor in the Company would be increased to approximately 33.44 per cent. of the issued share capital of the Company. Such an increase would give rise to an obligation on the part of Vandor to make a mandatory offer for all the Shares under Rule 26 of the Code. Such increase in the shareholdings of Vandor will not result in the number of Shares held by the public being less than 25 per cent. of the issued share capital of the Company. The Directors have no intention to exercise the power to repurchase Shares to such an extent as may result in less than the 25 per cent. of the Shares being held by the public.

FUNDING OF REPURCHASES

The Company is empowered by its memorandum of association and bye-laws to repurchase its Shares. Repurchases will be funded entirely from the funds legally available for that purpose. Bermuda law provides that the amount of capital repaid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant share, or funds of the Company that would otherwise be available for dividend or distribution or the proceeds of a new issue of shares made for such purpose. The amount of premium payable on repurchases may only be paid out of either the funds of the Company that would otherwise be available for dividend or distribution or out of the share premium account of the Company.

As compared with the financial position of the Company as at 31 March 2002 (being the date of its latest audited accounts), the Directors consider that there would be a material adverse impact on the working capital and on the gearing position of the Company in the event that the general mandate were exercised in full. No repurchase would be made in circumstances that would have a material adverse impact on the working capital or gearing ratio of the Company.

DIRECTORS, THEIR ASSOCIATES AND CONNECTED PERSONS

None of the Directors nor, to the best of the knowledge of the Directors having made all reasonable enquiries, any of the associates of any of the Directors has any present intention, in the event that the proposal to grant to the Directors a general mandate for the repurchase of its Share is approved by shareholders, to sell Shares to the Company.

No connected person (as defined in the Listing Rule) of the Company has notified the Company that he/she has a present intention to sell Shares to the Company nor has any such connected person undertaken not to sell any of the securities held by him/her to the Company in the event that the Company is authorised to make a repurchase of its Shares.

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UNDERTAKING OF THE DIRECTORS

The Directors have undertaken to the Stock Exchange to exercise the power of the Company to make repurchases pursuant to the proposed general mandate in accordance with the Listing Rules and the applicable laws of Bermuda, and in accordance with the regulations set out in the memorandum of association and bye-laws of the Company.

SHARE PRICES

During each of the twelve months prior to the printing of this circular, the highest and lowest traded prices for the Shares on the Stock Exchange were as follows:

	Highest	Lowest
Month	Traded Prices	Traded Prices
	HK$	HK$
2001
August	0.160	0.134
September	0.118	0.052
October	0.090	0.068
November	0.103	0.081
December	0.107	0.060
2002
January	0.058	0.020
February	0.022	0.014
March	0.021	0.015
April	0.016	0.015
May	0.018	0.014
June	0.015	0.011
July	0.012	0.010

SECURITIES REPURCHASES MADE BY THE COMPANY

In the six months immediately prior to the printing of this circular, the Company repurchased the following Shares on the Stock Exchange:

	Number of Shares	Price per Share	Price per Share	Aggregate
Month of Repurchase	Repurchased	Highest	Lowest	Price paid
		HK$	HK$	HK$
April 2001	3,846,000	0.122	0.102	431,000

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