09:42     KARCE INTL HOLD<01159>-Announcement&Resumption of Trading-1         

    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.                                                             
                                                                              
    Karce International Holdings Company Limited                              
    (Incorporated in Bermuda with limited liability)                          
    (Stock Code : 1159)                                                       
                                                                              
    PROPOSED MAJOR TRANSACTION                                                
    ASSIGNMENT OF LOAN AND ADVANCES AND SUBSCRIPTION                          
    OF SECURITIES                                                             
                                                                              
    The Board is pleased to announce that on 28th February, 2005              
    (Canadian time i.e. 1st March, 2005 Hong Kong time) the Group             
    has entered into (1) the Assignment and Share Subscription                
    Agreements pursuant to which the Group has agreed to assign the           
    Karce Loan to Ascalade Inc. in consideration for the allotment            
    and issue of Ascalade Inc. Shares and (2) the Assignment and              
    Unit Subscription Agreements pursuant to which the Group has              
    agreed to assign the Karce Advances to Ascalade Inc. in                   
    consideration of the issuance of Units.                                   
                                                                              
    The Transactions are mainly to strengthen the balance sheet of            
    Ascalade Group so as to give Ascalade Group greater financial             
    flexibility to pursue additional capital in the future and they           
    constitute a major transaction of the Company under Rule 14.06(3)         
    of the Listing Rules. A circular containing, inter alia, further          
    information of the Transactions will be despatched to the                 
    Shareholders as soon as possible. Ascalade Group may or may not           
    be able to pursue such additional capital (including Public               
    Listing Event) and the Shareholders and investors are advised             
    to exercise caution when dealing in the Shares.                           
                                                                              
    Trading in the Shares on the Stock Exchange has been suspended            
    since 9:30 a.m. on 2nd March, 2005 pending the release of this            
    announcement. Application has been made to the Stock Exchange             
    for the resumption of trading in the Shares from 9:30 a.m. on             
    8th March, 2005.                                                          
                                                                              
    THE ASSIGNMENT AND SHARE SUBSCRIPTION AGREEMENTS                          
                                                                              
    Date:                                                                     
                                                                              
    28th February, 2005 (Canadian time i.e. 1st March, 2005 Hong              
    Kong time)                                                                
                                                                              
    Parties:                                                                  
                                                                              
    (a)     the loan assignment agreement                                     
                                                                              
    1.      T&S                                                               
                                                                              
    2.      ACL                                                               
                                                                              
    3.      Ascalade Communications                                           
                                                                              
    4.      Ascalade Inc.                                                     
                                                                              
    (b)     the share subscription agreement                                  
                                                                              
    1.      Dragon                                                            
                                                                              
    2.      Ascalade Inc.                                                     
                                                                              
    Save as the approximately 30.8% equity interest in Ascalade Inc.          
    owned by the Group before completion of the Agreements, to the            
    best of the Directors' knowledge,