09:45     KARCE INTL HOLD<01159>-Announcement&Resumption of Trading-8         

    additional capital (including Public Listing Event) and the               
    Shareholders and investors are advised to exercise caution when           
    dealing in the Shares.                                                    
                                                                              
    The Directors consider that the terms of the Agreements and the           
    transactions contemplated therein are fair and reasonable and             
    in the interests of the Shareholders as a whole.                          
                                                                              
    GENERAL                                                                   
                                                                              
    The Transactions, in aggregate, 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.                                                                 
                                                                              
    Pursuant to Rule 14.40 of the Listing Rules, a major transaction          
    must be made conditional on approval by shareholders. To the              
    understanding of the Directors, no Shareholder shall be required          
    to abstain from voting if the Company were to convene a general           
    meeting for the approval of the Agreements. Pursuant to Rule              
    14.44(2) of the Listing Rules, written Shareholders' approvals            
    in relation to the Agreements and the transactions contemplated           
    therein have been obtained from Sapphire Profits Limited, Prove           
    Limited, Hu Sen Chun and Li Kwok Wai, who are beneficial                  
    Shareholders holding approximately 42%, 3.63%, 2.31% and 2.8%             
    of the issued share capital of the Company respectively (i.e.             
    approximately 50.74% shareholding interest in aggregate) and              
    have the right to attend and vote at a general meeting to approve         
    the Agreements if such a meeting were being convened.                     
                                                                              
    As at the date of this announcement, the Board consists of four           
    executive Directors, Mr.Tong Shek Lun, Mr. Li Ka Fai, Fred, Ms.           
    Ko Lai King, Kinny and Ms. Chung Wai Yu, Regina, two non-executive        
    Directors, Mr. Lee Kwok Leung and Mr. Yang Yiu Chong, Ronald              
    Jeffrey and three independent non-executive Directors, Mr. Sun            
    Yaoquan, Mr. Tsao Kwang Yung, Peter and Mr. Goh Gen Cheung.               
                                                                              
    SUSPENSION AND RESUMPTION OF TRADING IN 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.                                                          
                                                                              
    DEFINITIONS                                                               
                                                                              
    The following defined terms are used in this announcement:                
                                                                              
    "affiliated company"    refers to a company which, in accordance          
    with Hong Kong Financial Reporting Standards, is recorded using           
    the equity method of accounting in any entity's financial                 
    statements                                                                
                                                                              
    "Agreements"    referring to the Assignment and Share Subscription        
    Agreements and the Assignment and Unit Subscription Agreements            
                                                                              
    "Arkon" Arkon Network Inc., a company incorporated in the                 
    British Columbia of Canada and is a wholly owned subsidiary of            
    Ascalade Inc.                                                             
                                                                              
    "Arkon Group"   Arkon and/or its subsidiaries or any of them              
                                                                              
    "ACL"   Ascalade Communications Limited, a limited company                
    incorporated in Hong Kong and is a wholly owned subsidiary of             
    Ascalade Communications