10:19     KANTONE HOLDING<01059>-Announcement&Resumption of Trading-5         

    Subscription right:                                                       
    Pursuant to the Subscription Agreement, the Company                       
    also granted to CSFB an option upon the issue of the                      
    Original Tranche 1 Bonds, the Additional Tranche 1                        
    Bonds and the Tranche 2 Bonds on the following terms:-                    
                                                                              
    (1)     Exercise period: from and including the closing                   
    date of the relevant Bonds up to and including the                        
    relevant maturity date                                                    
                                                                              
    (2)     Exercise price: 125 per cent. of the Base Price                   
    of the relevant Bonds                                                     
                                                                              
    (3)     Maximum number of Shares to be subscribed: up                     
    to 15% of the principal amount of the relevant Bonds                      
    issued divided by the relevant Base Price                                 
                                                                              
    In respect of each of the Original Tranche 1 Bonds                        
    and the Additional Tranche 1 Bonds, the Subscription                      
    Right shall, applying the Relevant Exchange Rate,                         
    give CSFB an option for the subscription of up to                         
    30,437,073 new Shares (representing approximately                         
    1.30 per cent. of the existing issued share capital                       
    of the Company) at HK$0.3844, being the Fixed                             
    Conversion Price for the Original Tranche 1 Bonds as                      
    at 31 March 2005 (the trading day immediately prior                       
    to the date of the Subscription Agreement).                               
                                                                              
    The maximum number of new Shares which the                                
    Subscription Right in respect of the Tranche 2 Bonds                      
    shall entitle CSFB to subscribe for cannot be                             
    ascertained at present since the Base Price in respect                    
    of the Tranche 2 Bonds cannot be determined now. A                        
    separate announcement will be issued by the Company                       
    if the Tranche 2 Bonds are to be issued.                                  
                                                                              
    General mandate:                                                          
    The maximum number of new Shares which may be issued                      
    upon conversion of the Original Tranche 1 Bonds based                     
    on the Fixed Conversion Price is 162,320,499                              
    (applying the Relevant Exchange Rate) representing                        
    approximately 6.93 per cent. and approximately 6.48                       
    per cent. of the existing issued share capital and                        
    the enlarged issued share capital respectively. Upon                      
    exercise of the Subscription Right in respect of the                      
    Original Tranche 1 Bonds in full (applying the                            
    Relevant Exchange Rate), 30,437,073 new Shares,                           
    representing approximately 1.30 per cent. and                             
    approximately 1.28 per cent. of the existing issued                       
    share capital and the enlarged issued share capital                       
    respectively, will be issued by the Company. The total                    
    number of Shares which may be issued upon full                            
    conversion of the Original Tranche 1 Bonds and the                        
    exercise in full of the Subscription Right in respect                     
    of the Original Tranche 1 Bonds based on the Fixed                        
    Conversion Price is 192,757,572 Shares, representing                      
    approximately 8.23 per cent. and approximately 7.60                       
    per cent. of the existing issued share capital and                        
    the enlarged issued share capital respectively, which                     
    Shares, will be issued pursuant to the Existing                           
    General Mandate.                                                          
                                                                              
    The maximum number of new Shares which may be issued                      
    upon conversion of the Original Tranche 1 Bonds based                     
    on the Floating Conversion Price cannot be                                
    ascertained at present because the Floating                               
    Conversion Price can only be determined when the                          
    notice of conversion is issued by CSFB. In any event,                     
    the total number of Shares to be issued pursuant to                       
    the conversion of the Original Tranche 1 Bonds and                        
    the exercise of the Subscription Right in respect of                      
    the Original Tranche 1 Bonds will not