Comba Telecom Systems Holdings Limited — Share Issue/Capital Change 2000

May 3, 2000

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any less howsoever arising from or in reliance open the whole or any part of the contents of this announcement.

Rockapetta Holdings Limited

(Incorporated in Bermuda with limited liability)

PLACING OF 180,000,000 NEW SHARES

AND

PROPOSED ISSUE OF HK$13,200,000 CONVERTIBLE NOTES

AND

INCREASE IN THE AUTHORISED SHARE CAPITAL

Financial Adviser to the Company

Ka Wah Capital Limited

Rockapetta Holdings Limited (the "Company") has conditionally agreed to issue and, through Business Securities Limited ("Business Securities"), a) place 180,000,000 new ordinary shares ("Placing Shares") of HK$0.10 each in the share capital of the Company ("Shares") at a price of HK$0.20 per share ("Placing") and b) place HK$13,200,000 convertible notes (the "Convertible Notes") which will carry the right to convert into Shares at a conversion price of HK$0.22 to independent investors.

The Placing and Convertible Notes are fully underwritten by Business Securities.

The net proceeds from the Placing and Convertible Notes of approximately HK$48 million will be used as general working capital for the day-to-day operations of the Group.

The Placing Shares represent approximately 51.46% of the existing issued share capital of the Company of 349,760,000 Shares and approximately 33.98% of the Company's issued share capital as enlarged by the Placing.

Holders of the Convertible Notes shall have the right to convert the principal amount of the Convertible Notes into 60,000,000 Shares, representing approximately 17% of the existing issued share capital and 10% of the enlarged issued share capital after the Placing.

The Placing and the Convertible Notes are conditional upon the Stock Exchange granting listing of, and permission to deal in the Placing Shares, and the Shares to be issued upon the exercise of the conversion rights attaching to the Convertible Notes.

At the request of the Company, the trading of the Company's Shares was suspended with effect from 10:01 a.m. on 26 April 2000 pending the issuance of this announcement. An application will be made for the resumption of trading of the Company's Shares with effect from 10:00 a.m. on 3 May 2000.

Use of Proceeds

The net proceeds from the Placing and Convertible Notes of approximately HK$48 million will be used as general working capital for the day-to-day operations of the Group. There is no designated usage for the time being.

A). PLACING OF NEW SHARES

The Placing Shares represent approximately 51.46% of the existing issued share capital of the Company of 349,760,000 Shares and approximately 33.98% of the Company's issued share capital as enlarged by the Placing. The net proceeds from the Placing of approximately HK$35 million will be used as general working capital of the Company and its subsidiaries.

No person is entitled to appoint any director to the Company as a result of the Placing.

The terms and conditions of the Placing were negotiated between the Company and Business Securities on an arm's length basis.

Placing agreement dated 28 April 2000 (the "Placing Agreement")

Issuer:

Rockapetta Holdings Limited

Placing agent and underwriter:

Business Securities

Business Securities is the placing agent and underwriter and will receive a placement commission of 1.5% on the gross proceeds of the Placing. Business Securities is independent of and not connected with the Company, the directors, chief executive or substantial shareholder of the Company, and any of their subsidiaries or any of their respective associates (as defined in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules" and the "Stock Exchange" respectively)).

Placees:

The number of placees will not be less than ten and the placees will be independent of and not connected with the Company, the directors, chief executive or substantial shareholders of the Company, and any of their subsidiaries or any of their respective associates (as defined in the Listing Rules).

Placing price:

The placing price is HK$0.20 per Placing Share. This price was agreed after arm's length negotiations and represents (a) a discount of approximately 23.1% to the closing price of HK$0.26 per Share quoted on the Stock Exchange on 25 April 2000; and (b) a discount of approximately 27.5% to the average closing price per Share of approximately HK$0.276 per Share as quoted on the Stock Exchange from 17 April 2000 to 25 April 2000, both dates inclusive, being the last five full trading days immediately before the issue of this announcement; and (c) a discount of approximately 45.3% to the average closing price per Share of approximately HK$0.366 per Share as quoted on the Stock Exchange from 10 April 2000 to 25 April 2000, both dates inclusive, being the last ten full trading days immediately before the issue of this announcement.

The net proceeds of the Placing will be paid to the Company on completion of the Placing.

Rights:

The Placing Shares will on issue rank equally with the then existing Shares.

Number of Shares to be placed:

180,000,000 new Shares are to be placed, representing approximately 51.46% of the existing issued share capital of the Company of 349,760,000 Shares and approximately 33.98% of the issued share capital of the Company as enlarged by the Placing of 180,000,000 Shares. The Placing Shares are fully underwritten by Business Securities.

Conditions of the Placing:

The Placing is conditional upon:

(a) the approval of the increase in the authorised share capital of the Company to HK$500,000,000 divided into 5,000,000,000 shares of HK$0.10 each by the members of the Company in general meeting;

(b) the Listing Committee of the Stock Exchange agreeing to grant a listing of and permission to deal in, the Placing Shares;

(c) the approval of the Placing and the issue of the Placing Shares by the shareholders of the Company in general meeting; and

(d) the approval of the placing and issue of the Placing Shares by the Bermuda Monetary Authority.

Completion:

The Placing is to be completed three business days after satisfaction of the Conditions. The Placing Agreement will lapse if the Conditions are not satisfied by 30 June 2000 unless the parties agree otherwise.

Application for listing:

Application will be made by the Company to the Listing Committee of the Stock Exchange for the grant of the listing of, and permission to deal in, the Placing Shares.

B). PROPOSED ISSUE OF HK$13,200,000 CONVERTIBLE NOTES

The Company has also entered into a conditional subscription agreement on 28 April 2000 (the "Subscription Agreement") with Business Securities. Pursuant to the Subscription Agreement, the Company has agreed to issue and Business Securities has agreed to underwrite HK$13,200,000 Convertible Notes. The Convertible Notes, when issued, will carry the right to convert into Shares at a conversion price of HK$0.22. The Convertible Notes will not be listed and will only be subscribed for by parties independent of and not connected with the company, the directors, chief executive or substantial shareholder of the Company and any of their subsidiaries or any of their respective associates (as defined in the Listing Rules).

The terms and conditions of the Convertible Notes were negotiated between the Company and Business Securities on an arm's length basis.

The Convertible Notes are transferable and bear no interest. The Company has undertaken that it will ensure that connected persons will not subscribe for the Convertible Notes initially and thereafter, the Company will disclose to the Stock Exchange any dealing by the substantial shareholder and any director of the Company, and any of their subsidiaries or any of their respective associates from time to time in the Convertible Notes immediately upon the Company becoming aware of such dealings.

Subscription Agreement dated 28 April 2000

Issuer:

Rockapetta Holdings Limited

Placing agent and underwriter:

Business Securities is the placing agent and underwriter and will receive a fee of HK$198,000. Business Securities is independent of and not connected with the Company, the directors, chief executive or substantial shareholder of the Company, and any of their subsidiaries or any of their respective associates (as defined in the Listing Rules).

Principal amount of Convertible Notes:

The principal amount of the Convertible Notes is HK$13,200,000.

Repayment:

The Company shall repay the principal moneys outstanding under the Convertible Notes to the holders of the Convertible Notes on the second anniversary of the date of issue of the Convertible Notes.

Conversion right:

The holders of the Convertible Notes shall have the right to convert the principal amount of the Convertible Notes into 60,000,000 Shares at any time from the completion date. The price at which each Share shall be issued upon conversion shall be HK$0.22 subject to adjustment. Shares issued upon conversion shall rank pari passu in all respects with all other existing Shares outstanding at the date of the conversion notice. Upon conversion of all the conversion rights attaching to the Convertible Notes the holders of the Convertible Notes would hold 10% of the issued share capital of the Company as enlarged by the Placing and the exercise of the conversion rights attaching to the Convertible Notes.

Subscribers:

Subscribers procured by Business Securities will be independent of and not connected with the Company, the directors, chief executive or substantial shareholder of the Company, and any of their subsidiaries or any of their respective associates (as defined in the Listing Rules).

Conversion price:

HK$0.22, subject to adjustment, the conversion price represents a discount of 15% to the closing price of HK$0.26 per Share as quoted on the Stock Exchange on 25 April 2000.

Conditions of the Convertible Notes:

The subscription of the Convertible Notes is conditional upon, among other conditions:

(a) the shareholders of the Company having approved at a special general meeting to be held the increase in the authorised share capital of the Company to HK$500,000,000 divided into 5,000,000,000 Shares, the issue of the Convertible Notes, and the issue and allotment of the Shares upon the exercise of the conversion rights;

(b) the Listing Committee of the Stock Exchange having granted listing of and permission to deal in the Shares to be issued upon the exercise of the conversion rights attaching to the Convertible Notes; and

(c) if required under the laws of Bermuda, the Bermuda Monetary Authority having been informed of the proposed issue of the Convertible Notes and of the Conversion Shares to be issued upon exercise of the conversion rights attached to the Convertible Notes.

Completion:

The subscription of the Convertible Notes is to be completed three business days after satisfaction of the conditions. The Subscription Agreement will lapse if the conditions are not satisfied on or before 90 days of the date of the Subscription Agreement.

Application for listing:

Application will be made by the Company to the Listing Committee of the Stock Exchange for the grant of the listing of, and permission to deal in, the shares issued upon conversion of the Convertible Notes.

General

The Directors consider the terms of the Placing Agreement and Subscription Agreement to be fair and reasonable and in the best interest of the Company and the shareholders of the Company as a whole.

The Company is an investment holding company. Its subsidiaries are principally engaged in design, manufacture, sale and distribution of baby products.

Reason for the Placing and issue of Convertible Notes

In view of the current market conditions the Directors consider that the Placing and the issue of Convertible Notes represents an opportunity to raise capital for the Company while broadening the shareholder base and the capital base of the Company.

The substantial shareholder of the Company is Mr. Kwok Chin Wing who currently beneficially holds 101,798,000 shares in the Company, representing approximately 29.1% of the Company's share capital. After the Placing, Mr. Kwok Chin Wing will beneficially hold 19% of the enlarged capital and approximately 17% of the issued share capital after the conversion of the Convertible Notes. The Placing and the conversion of Convertible Notes will not introduce a new substantial shareholder to the Company.

Resumption of Trading

At the request of the Company, the trading of the Company's Shares was suspended with effect from 10:01 a.m. on 26 April 2000 pending the issuance of this announcement. An application will be made for the resumption of trading of the Company's Shares with effect from 10:00 a.m. on 3 May 2000.

By order of the board of directors of

Rockapetta Holdings Limited

Kwok Chin Wing

Chairman

Hong Kong, 2 May 2000