09:44     KARCE INTL HOLD<01159>-Announcement&Resumption of Trading-5         

    Subscription Agreements by written notice to the other parties            
    and, in such event, all parties shall be released from all                
    obligations contained thereunder. The Group does not intend to            
    waive any of the above conditions as at the date of this                  
    announcement.                                                             
                                                                              
    Relevant major terms of the Convertible Debentures:                       
                                                                              
    The relevant major terms of the Convertible Debentures are                
    summarized as follows:                                                    
                                                                              
    (a)     Maturity - The Convertible Debentures will mature in November     
    2006                                                                      
                                                                              
    (b)     Interest - The Convertible Debentures will bear a rate of         
    interest of 12% per annum calculated and payable semi-annually            
    in arrears                                                                
                                                                              
    (c)     Right to convert into Common Shares - The Convertible             
    Debentures shall be convertible into Ascalade Inc. Shares at              
    the holder's option at any time until maturity for such number            
    of Ascalade Inc. Shares equal to the principal amount of the              
    Convertible Debentures divided by a conversion price (subject             
    to adjustment(s)) which shall be the lesser of:                           
                                                                              
    (i)     a 15% discount of the share price pursuant to Public Listing      
    Event; and                                                                
                                                                              
    (ii)    CAD 0.85 (approximately HK$ 5.36) per Ascalade Inc. Share         
                                                                              
    In the event Public Listing Event has not been completed, the             
    conversion price will be equal to CAD 0.85 (approximately HK$             
    5.36) per Ascalade Inc. Share                                             
                                                                              
    Subsequent to the completion of Public Listing Event and in the           
    event a holder of the Convertible Debentures exercises                    
    conversion rights, Ascalade Inc. shall have the right to settle           
    the conversion in cash (or a combination of cash and Ascalade             
    Inc. Shares) in lieu of Ascalade Inc. Shares unless the holder            
    has expressly indicated that it does not wish to receive cash             
    in lieu of Ascalade Inc. Shares                                           
                                                                              
    (d)     Redemption and Forced Conversion - Following the completion       
    of Public Listing Event, Ascalade Inc. shall have the option              
    to redeem the Convertible Debentures, in whole or, from time              
    to time, in part, by issuing and delivering that number of                
    Ascalade Inc. Shares obtained by dividing the principal amount            
    of the outstanding Convertible Debentures by a price equal to             
    15% discount to the weighted average closing price of Ascalade            
    Inc. Shares on the designated stock exchange during the 20                
    consecutive trading days ending five trading days preceding the           
    date on which the notice of redemption is given                           
                                                                              
    (e)     Settlement in Ascalade Inc. Shares on Maturity - Subsequent       
    to the completion of Public Listing Event, Ascalade Inc. shall            
    have the option to satisfy its obligation to repay the principal          
    amount of the Convertible Debentures, in whole or in part, due            
    at maturity upon prior written notice, by delivering that number          
    of freely tradable Ascalade Inc. Shares obtained by dividing              
    the principal amount of the Convertible Debentures by 95% of              
    the weighted average closing price of Ascalade Inc. Shares on             
    the designated stock exchange during the 20 consecutive trading           
    days ending five trading days preceding the date fixed for                
    redemption or the maturity date, as the case may be                       
                                                                              
    (f)     Purchase for Cancellation - Ascalade Inc. may purchase            
    Convertible Debentures from the respective holders for                    
    cancellation by tender or private contract at any time,