09:08     CITIC 21CN<00241> - Announcement & Resumption of Trading (3)        

    the articles of association of the JV Company, the                        
    difference between the total amount of investment and                     
    the registered capital shall be financed through bank                     
    loans or other fund raising methods by the JV Company.                    
    While the Company has obligation to assist the fund                       
    raising process for the difference between the total                      
    amount of investment capital and the registered                           
    capital, it has no capital commitment to provide such                     
    difference.                                                               
                                                                              
    Registered capital of the JV Company                                      
    The registered capital of the JV Company will be                          
    RMB60,000,000 (equivalent to approximately                                
    HK$56,603,774), of which RMB30,000,000 (equivalent                        
    to approximately HK$28,301,887) will be contributed                       
    by CITIC 21CN Telecom in cash, RMB18,000,000                              
    (equivalent to approximately HK$16,981,132) will be                       
    contributed by AQSIQ in cash, to be advanced by the                       
    Group on behalf of AQSIQ, and the remaining                               
    RMB12,000,000 (equivalent to approximately                                
    HK$11,320,755) will be contributed by China Huaxin                        
    Telecom by cash. The entire capital contributions                         
    shall be fully paid up within one month from the                          
    issuance date of the business license of the JV                           
    Company.                                                                  
                                                                              
    Upon establishment of the JV Company, it will become                      
    a jointly controlled entity of the Company. According                     
    to Hong Kong Accounting Standard No. 31, jointly                          
    controlled entities are accounted for using the                           
    proportionate consolidation method under which the                        
    share of individual assets and liabilities, income                        
    and expenses and cash flows of jointly controlled                         
    entities is included in the relevant components of                        
    the consolidated accounts. The JV Company will be                         
    partially consolidated into the Group's accounts in                       
    accordance with its shareholding in the JV Company.                       
                                                                              
    Profit sharing in the JV Company                                          
    Upon establishment of the JV Company, CITIC 21CN                          
    Telecom, AQSIQ and China Huaxin Telecom will be                           
    entitled to share the net profits of the JV Company                       
    in proportion to their equity interests in the                            
    registered capital of the JV Company.                                     
                                                                              
    AQSIQ                                                                     
    Board of directors of the JV Company                                      
    The board of directors of the JV Company will comprise                    
    nine directors, of which five will be appointed by                        
    the CITIC 21CN Telecom, two will be appointed by AQSIQ                    
    and the remaining two will be appointed by China                          
    Huaxin Telecom. The chairman and the vice-chairman                        
    of the board of directors will be appointed by CITIC                      
    21CN Telecom and AQSIQ respectively. Six directors                        
    will form the quorum of the directors' meeting of the                     
    JV Company. Pursuant to the JV Agreement, any                             
    resolution in the board of directors will require                         
    consents of two third of the directors.                                   
                                                                              
    Principal roles of the Shareholders of the JV Company                     
    Pursuant to the JV Agreement,                                             
    *       the Company is under the obligation, among other                  
    matters, to lead in the development of the JV                             
    Company's business model and strategy, and to assist                      
    the JV Company to raise RMB90 million (equivalent to                      
    approximately HK$85 million) through debt financing;                      
                                                                              
                                                                              
    *       AQSIQ is under the obligation, among other matters,               
    to provide consultation on industry policy and                            
    business direction, and support the development