09:35     CHINA HEALTH<00673> - Announcement & Resumption (3)                 

    Transferability        The Bondholders may transfer or assign the         
    Convertible Bonds after notifying the Company. Where such assignment or   
    transfer is to a connected person of the Company, all the requirements    
    under the Listing Rules shall be fully complied with to the satisfaction  
    of the Stock Exchange.                                                    
                                                                              
    Redemption Option        The Company may redeem the Bonds in whole at     
    100% at any time after the second anniversary of issuance and prior to    
    the Maturity Date by way of a notice in advance of 30 business days,      
    subject to the share price having closed at or above 160% of the strike   
    price for a consecutive 20 days of trading. Bondholders retain the right  
    of conversion prior to the completion of such redemption.                 
                                                                              
    Maturity        The Convertible Bonds are due and mature on the Maturity  
    Date. The Company shall repay the principal amount outstanding under the  
    Convertible Bonds to the Bondholder(s) together with all interest         
    accrued thereon.                                                          
                                                                              
    Voting right        Bondholders will not be entitled to attend or vote    
    at any Shareholders' meetings of the Company by reason only of it being   
    a holder of the Convertible Bonds (or any part thereof).                  
                                                                              
    Status        The Convertible Bonds will be direct, unsubordinated,       
    unconditional and unsecured obligations of the Company and will at all    
    times rank pari passu in right of payment with all other present and      
    future direct, unsubordinated, unconditional and unsecured obligations    
    of the Company.                                                           
                                                                              
    Listing        Application will be made for the listing of, and           
    permission to deal in, the Conversion Shares on the Stock Exchange.       
                                                                              
    Comparison of the Conversion Price                                        
    The Conversion Price of HK$2.525 per Conversion Share (subject to         
    adjustment) represents (i) a discount of approximately 6.5% to the        
    closing price of HK$2.7 per Share as quoted on the Stock Exchange on 25   
    April 2005; (ii) a discount of approximately 6.7% to the average closing  
    price of HK$2.705 per Share as quoted on the Stock Exchange for the 5     
    trading days up to and including 25 April 2005; and (iii) a discount of   
    approximately 6.8% to the average closing price of HK$2.71 per Share as   
    quoted on the Stock Exchange for the 10 trading days up to and including  
    25 April 2005.                                                            
                                                                              
    Conversion Shares                                                         
    For illustrative purpose and assuming full conversion at the Conversion   
    Price of HK$2.525 per Conversion Share (subject to adjustment for, among  
    other things, share split, subdivision or consolidation of the Shares,    
    bonus issues, rights issues, capitalization of profits or reserves,       
    capital distribution or other dilutive events), the Convertible Bonds     
    with an aggregate principal amount of US$6.6 million are convertible      
    into approximately 20,388,118 Conversion Shares, representing (i)         
    approximately 9.4% of the existing issued share capital of the Company;   
    (ii) approximately 8.7% of the issued share capital of the Company as     
    enlarged by the new Shares issued upon conversion of the Existing Bonds   
    at the conversion price at HK$1.00 each (subject to adjustment); and      
    (iii) approximately 8.0% of the issued share capital of the Company as    
    enlarged by the issue of new Shares upon conversion of the Existing       
    Bonds and the Conversion Shares.                                          
                                                                              
    The Conversion Shares will be issued pursuant to the general mandate      
    given to the Directors at the annual general meeting of the Company held  
    on 27 August 2004. Such general mandate has not been utilized until the   
    date of this announcement.                                                
                                                                              
    Completion of the Subscription Agreements is subject to the satisfaction  
    of the conditions precedent therein. As the Subscription Agreements may   
    or may not complete, Shareholders and prospective investors are advised   
    to exercise caution when dealing in the shares of the Company.            
                                                                              
    2.        CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY            
    To the best of the knowledge of the Directors and having made all         
    reasonable enquiries, the shareholdings in the Company as at the date of  
    this announcement, and after conversion of the Existing Bonds and the     
    Convertible Bonds respectively (without taking into account the Shares    
    to be issued pursuant to the exercise of the Share Options) are           
    summarized as follows:                                                    
                                                                              
                            After                                             
                            conversion of the                                 
                    After         Existing Bonds                              
            As at the date         conversion of the         and the          
    Convertible                                                               
            of this announcement        Existing Bonds        Bonds           
                            (Note 4)                                          
            No. of Shares                                No. of Shares