09:56     CASIL TELECOM<01185>-Announcement & Resumption of Trading(4)        

    will be subject to final measurement after installation and               
    construction.                                                             
                                                                              
    Jiangsu Longyuan                                                          
                                                                              
    The kenetic power plant project of Jiangsu Longyuan has been approved     
    by the NDRC as follows:                                                   
                                                                              
    1.        the period of authorised operation would be 25 years            
    2.        the construction size would be 100.5 megawatt                   
    3.        the total investment and registered capital would be            
    RMB872,620,000 and RMB211,610,000 respectively                            
    4.         prior to the production of 30,000 hours of electricity,        
    Jiangsu Longyuan would be entitled to a electricity rate of RMB0.519      
    per hour for each kilowatt. After the production of electricity has       
    reached 30,000 hours until the end of the authorised operation period,    
    the electricity price would be calculated according to the average        
    local grid electricity rate. The actual rate would be determined by       
    the relevant price authority                                              
    5.         the approval is subject to the application of CDM.             
                                                                              
    Reasons for and benefit of investing in the joint ventures                
                                                                              
    The Group is principally engaged in the businesses of intelligent         
    transportation systems, broadband wireless access systems and             
    equipment, and manufacturing and sale of telecommunications products.     
                                                                              
    Nevertheless, the Directors considered that the Company would benefit     
    from the entering into of such joint venture contracts, as the            
    transactions will widen the business scope and earning base of the        
    Group. Given the shortage of electricity supplies in the PRC and the      
    global trend towards renewable energy for environment reasons, the        
    investment by the Company into such power supply project is also          
    fulfilling the Group corporate responsibility.                            
                                                                              
    Both joint ventures have been granted a concession of 25 years by         
    NDRC. Prior to the production of 30,000 hours of electricity, the         
    joint ventures would be entitled to a electricity rate of RMB0.509 to     
    RMB0.519 per hour for each * (kilowatt). After the production of          
    electricity has reached 30,000 hours until the end of the authorised      
    operation period, the electricity price would be calculated according     
    to the average local grid electricity rate. The rate would be             
    determined by the relevant price authority.                               
                                                                              
    The terms of the joint venture contracts and articles of association      
    are negotiated after arm's length negotiation and taking into account     
    that for each of the joint venture to enjoy tax allowance, a foreign      
    investment of 25% in the registered capital is required. The board of     
    directors (including the independent non-executive directors) of the      
    Company considers that the transactions was entered into on normal        
    commercial terms, the terms of the Sino-foreign joint venture             
    contracts of Jiangsu Longyuan and Jilin Sanyuan are fair and              
    reasonable and in the interests of the shareholders of the Company as     
    a whole.                                                                  
                                                                              
    Funding                                                                   
                                                                              
    Pursuant to the joint venture contracts, the amount of investment made    
    by each joint venture partner is restricted to their respective           
    contributions in the registered capital of the joint ventures. The        
    difference between total investment and registered capital will be        
    funded by bank borrowings to be secured by assets of the joint            
    ventures. Consent in principal to provide loan facilities has been        
    given by China Development Bank.                                          
                                                                              
    The share of registered capital to be contributed by the Group            
    amounted to an aggregate of RMB120,157,500 (equivalent to                 
    approximately HK$113,356,132) and will be payable in US$ according to     
    official rate as quoted by the People's Bank of China. The funding of     
    the capital contribution will be by way of internal resources and bank    
    borrowings. The joint ventures will be accounted for as associated        
    companies of the Company.                                                 
                                                                              
    Information on the joint venture partners                                 
                                                                              
    Longyuan Electric is a collectively owned enterprise established in       
    Beijing and engages in the provision of technology services and           
    maintenance services of electrical systems and electric appliances;       
    the development, production, sale and transfer of new technology, new     
    facilities and new materials in relation to electricity etc..             
                                                                              
    Nantong TSG Electric is a Sino-foreign joint venture enterprise