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(incorporated in the Cayman Islands with limited liability)	(incorporated in Bermuda with limited liability)
DISCLOSEABLE AND CONNECTED TRANSACTION	MAJOR AND CONNECTED TRANSACTION
PROPOSED CHANGE OF NAME

Summary

CCT Multimedia Holdings Limited, CCT Telecom Holdings Limited and Orient Rich (H.K.) Limited (a wholly-owned subsidiary of 海爾集團公司 (Haier Group Company)) entered into a conditional agreement on 4 July 2001 and a supplemental agreement on 11 July 2001 pursuant to which CCT Multimedia Holdings Limited has agreed to acquire (the “Proposed Acquisition”) (1) 100% of Foreland Agents Limited (and the relevant shareholder's loan), which holds 51% of the issued share capital in Haier CCT (H.K.) Telecom Co., Limited, from CCT Telecom Holdings Limited and (2) 49% of the issued share capital of Haier CCT (H.K.) Telecom Co., Limited from Orient Rich (H.K.) Limited for an aggregate consideration of HK$1,446,800,000.

The consideration shall be satisfied by the transfer of the Consideration Business, the shareholder's loans relating to the Consideration Business, the issue of the Loan Notes and the issue of the Consideration Shares.

The Proposed Acquisition constitutes a discloseable and connected transaction for CCT Telecom Holdings Limited and a major and connected transaction for CCT Multimedia Holdings Limited for the purposes of the Listing Rules.

The directors of CCT Multimedia Holdings Limited propose to change the name of CCT Multimedia Holdings Limited to “Haier-CCT Holdings Limited” and to adopt a new Chinese name “海爾中建集團有限公司” to replace “中建數碼媒體集團有限公司” for identification purposes upon completion of the Agreement and fulfilment of certain conditions.

At the request of CCT Multimedia Holdings Limited, trading in the shares of CCT Multimedia Holdings Limited has been suspended with effect from 10:00 a.m. on 5 July 2001. Application has been made to the Stock Exchange for the resumption of trading in the shares of CCT Multimedia Holdings Limited with effect from 10:00 a.m. on 13 July 2001.

The Agreement


Date:	4 July 2001 and 11 July 2001
Vendors:	(1)	CCT Telecom, the controlling shareholder of CCTMM; and
	(2)	Orient Rich, a wholly-owned subsidiary of Haier Group Company, which (save for its substantial interest in the HK JV), is independent of the directors, chief executive and substantial shareholders of CCTMM and its subsidiaries and their respective associates.
Purchaser:	CCTMM
The assets to be acquired:	(1)	the Foreland Shares representing the entire issued share capital of Foreland and the Shareholder’s Loan; and
	(2)	the Haier Shares representing 49% of the issued share capital of the HK JV.
Consideration:	(1)	the purchase price of the Foreland Shares and the Shareholder's Loan is HK$1,054,800,000 which shall be paid and satisfied:
		(i) as to HK$240,000,000 by the transfer of the Consideration Business and the assignment of the relevant shareholder's loans relating to the Consideration Business from the CCTMM Group to CCT Telecom or its nominee(s);
		(ii)as to HK$60,000,000 by the issue of the Loan Note in favour of CCT Telecom or its nominee(s); and
		(iii) as to HK$754,800,000 by the issue of 3,774,000,000 Consideration Shares in favour of CCT Telecom or its nominee(s); and
	(2)	the purchase price of the Haier Shares is HK$392,000,000 which shall be paid and satisfied by the issue of 1,960,000,000 Consideration Shares in favour of Orient Rich or its nominee(s).
	The total consideration of HK$1,446,800,000 is determined after arm's length negotiation between the parties after taking into account, amongst other things, the independent valuations of Foreland and the HK JV which are valued respectively at about HK$1,117 million and HK$886 million as at 31 May 2001 by an independent professional valuer, American Appraisal Hongkong Limited. The purchase price of the Foreland Shares and the Shareholder’s Loan represents a discount of approximately 5.6% to the valuation of the 100% interest in Foreland. The purchase price of the Haier Shares represents a discount of approximately 9.7% to the valuation attributable to a 49% interest in the HK JV. The Directors consider the consideration to be reasonable.
	The Consideration Shares will be issued at HK$0.20 per Share, representing a discount of approximately 21.6% to the closing price of HK$ 0.255 per Share as quoted on the Stock Exchange on 4 July 2001, being the date of the Agreement; and a discount of approximately 15.6% to the average closing price of approximately HK$0.237 per Share as quoted on the Stock Exchange for the last 5 trading days up to and including 4 July 2001. The Consideration Shares represent approximately 360.9% of CCTMM's existing issued share capital and approximately 78.3% of CCTMM's issued share capital as enlarged by the issue of the Consideration Shares.
Options:	Under the Agreement, CCTMM has (i) the PRC JV Option granted by Haier Group Company to purchase the 51% interest in the PRC JV from Haier Investments for HK$673,200,000 which shall be satisfied by the issue to Haier Group Company or its nominee(s) the PRC JV Option Shares at HK$0.20 each; and (ii) the CCT Technology Option granted by CCT Telecom to purchase the 100% interest in CCT Technology from CCT Telecom at a cash price equal to the net asset value of CCT Technology at the time of exercise. The Directors consider the exercise prices of the options to be reasonable.
	Both the PRC JV Option and the CCT Technology Option are exercisable in full or in part any time during the two-year period after the first anniversary of the date of completion of the Agreement.
	The exercise price of the PRC JV Option represents a discount of approximately 6.9% to the independent valuation attributable to the 51% interest in the PRC JV. American Appraisal Hongkong Limited has valued the PRC JV at HK$1,418,000,000 as at 31 May 2001. The issue price of the PRC JV Option Shares will be the same as that for the Consideration Shares. The PRC JV Option Shares represent approximately 211.8% of the existing issued share capital of CCTMM. Assuming that no further Shares will be issued other than the Consideration Shares and the PRC JV Option Shares, the PRC JV Option Shares will represent approximately 31.5% of CCTMM's issued share capital as enlarged by the issue of the Consideration Shares and the PRC JV Option Shares. The exercise price of the PRC JV Option is determined after arm's length negotiation between the parties after taking into account, amongst other things, the independent valuation of the PRC JV. The exercise price of the CCT Technology Option is determined after arm's length negotiation after taking into account, amongst other things, CCT Technology's interests in the PRC JV and the Service Contract. In setting such exercise price, the Directors are of the view that it is not necessary to make reference to the exercise price of the PRC JV Option.
	In the event that CCTMM exercises the PRC JV Option and/or the CCT Technology Option, CCTMM and all relevant parties will comply with all applicable rules and regulations including all applicable disclosure and approval requirements under the Listing Rules.
Conditions:	Completion is conditional on, amongst other things:
	(i)	all requisite resolutions being passed by the CCT Shareholders independent of CCTMM at the Extraordinary General Meeting approving the terms of and the transactions contemplated in the Agreement and the implementation thereof and the Export and Sourcing Transactions;
	(ii)	all requisite resolutions being passed by the CCTMM Shareholders independent of CCT Telecom at the Special General Meeting approving the terms of and the transactions contemplated in the Agreement and the implementation thereof, the Export and Sourcing Transactions and the Provision of Services;
	(iii)	the Stock Exchange having granted the listing of and permission to deal in the Consideration Shares and the PRC JV Option Shares; and
	(iv)	all necessary consents being granted by third parties which otherwise may prevent the Sale Shares from being transferred to CCTMM.
Completion:	Completion is expected to take place on or before the fifteenth day after fulfilment of the conditions (which shall be fulfilled by no later than 31 October 2001 unless otherwise agreed).

Consideration Business:

The Consideration Business consists of (1) Creditop International Inc. and its 9.8% interest in Mingpao.com Holdings Limited; and (2) Master Base Investments Inc. and its subsidiaries.

Creditop International Inc., an indirect wholly-owned subsidiary of CCTMM, is an investment holding company incorporated in the British Virgin Islands with limited liability and has a 9.8% interest in Mingpao.com Holdings Limited. Mingpao.com Holdings Limited is a subsidiary and the flagship Internet portal of one of the best known Chinese publishing groups.

Master Base Investments Inc., a wholly-owned subsidiary of CCTMM, is an investment holding company incorporated in the British Virgin Islands with limited liability. It owns 100% of the Wellfit Group which is engaged in the production of videos, concerts, variety shows and magazine publishing as well as organisation and production of corporate functions, promotion events and television programs. The audited combined profits before and after taxation of the Wellfit Group for the year ended 30 June 1999 were approximately HK$1.5 million and HK$1.1 million respectively and the corresponding figures for the year ended 30 June 2000 were approximately HK$13.1 million and HK$12.5 million respectively.

The value of the Consideration Business is determined with reference to, amongst other things, CCTMM's original investment cost of HK$134,400,000 in the Wellfit Group and the valuation of HK$1,225,000,000 prepared by American Appraisal Hongkong Limited, an independent valuer, of 100% of Mingpao.com Holdings Limited as at 31 December 2000.

Terms of the Loan Note:


Interest:	The Loan Note bears interest from the date of its issue at the rate of 5% per annum. Such interest is payable annually in arrears.
Maturity:	The second anniversary of the date of issue of the Loan Note. There are no early redemption rights under the terms of the Loan Note.

Transfer of the Loan Note:

The Loan Note may be assigned to any third party subject to compliance with the terms and conditions of the Loan Note and further subject to the conditions, approvals, requirements and any other provisions of or under all applicable laws and regulations. The CCTMM Directors do not intend to apply for the listing of the Loan Note on any stock exchange.

Further information about Foreland, the HK JV and the PRC JV

Foreland is an indirect wholly-owned subsidiary of CCT Telecom. Foreland owns 51% of the issued share capital of the HK JV. Apart from its 51% interest in the HK JV and shareholder’s loans, Foreland has entered into the Service Contract with CCT Technology, pursuant to which Foreland provides CCT Technology with management and technical services. The principal terms of the Service Contract are summarised in the sub-section headed “Provision of Services” below. Other than the aforesaid, Foreland has no material assets or liabilities.

The HK JV is a company with limited liability incorporated in Hong Kong on 25 October 2000. The HK JV was established by Foreland and Orient Rich primarily to perform the export and sourcing function for the mobile phones manufactured by the PRC JV. The audited loss of the HK JV for the period ended 31 December 2000 was approximately HK$3.4 million and the HK JV's audited net asset value as at 31 December 2000 was approximately HK$16.6 million.

The PRC JV is engaged in the research, development, manufacture and distribution of telecommunications equipment including mobile phones. The establishment of the PRC JV was approved on 25 August 2000 for a term of 20 years. According to its PRC statutory accounts, the PRC JV's audited loss for the period ended 31 December 2000 was approximately RMB0.5 million and its audited net asset value as at 31 December 2000 was approximately RMB98.8 million.

Existing shareholding structure

Shareholding structure immediately upon completion of the Agreement

Shareholding structure after restoration of CCTMM's public float to 25% but before exercise of the PRC JV Option and/or the CCT Technology Option (Note 2)

Shareholding structure after restoration of CCTMM's public float (Note 2) and upon full exercise of the PRC JV Option and the CCT Technology Option (Note 3)

Note:

Upon completion of the Agreement, CCTMM shall hold through Foreland and its nominee(s) the 100% interest in the HK JV.
Assuming that CCTMM will place new Shares to independent third parties for the purpose of restoring its public float to 25% after completion of the Agreement.
The PRC JV Option and the CCT Technology Option are only exercisable after the first anniversary of the date of completion of the Agreement and CCTMM may or may not exercise such options. Depending on the shareholding structure of CCTMM at the time of any such exercise, there may or may not be a change in control of CCTMM upon the exercise of the PRC JV Option. In the event that Haier Group Company holds 35% (or such lower amount as may be specified in the Hong Kong Code on Takeovers and Mergers (the “Code”) as being the level for triggering a mandatory general offer) or more of CCTMM's voting rights, the CCTMM Directors understand that Haier Group Company and CCTMM will comply with all applicable requirements under the Code. Assuming that (a) there is no change in the shareholding structure (and CCTMM's public float is restored to and maintained at 25%) after completion of the Agreement, (b) all relevant approvals are obtained and (c) CCTMM exercises the PRC JV Option and the CCT Technology Option in full after the first anniversary of the Agreement, Haier Group Company would become the largest shareholder of CCTMM, holding approximately 42.8% interest in CCTMM, and CCTMM and/or its nominee(s) would hold the entire beneficial interests in the HK JV and the PRC JV.
Upon full exercise of the PRC JV Option and the CCT Technology Option, CCTMM shall hold the 100% interest in the PRC JV through CCT Technology and its nominee(s).

Information about Haier Group Company

Haier Group Company is the largest household electrical appliance manufacturer in the PRC. Established 16 years ago, Haier Group Company is one of the most successful business enterprises in the PRC and the name “Haier” is a household name well regarded in the PRC. In a rating for the world's best business published by the Fortune magazine in 2000, Haier Group Company was the only one listed in the Asia-Pacific region. In 2000, Haier Group Company reported turnover of RMB 40.6 billion and pre-tax profit of RMB 3 billion. The “Haier” brand name stands for superior quality, and was independently valued at RMB 30 billion in 2000. Haier Group Company's products are sold in over 160 countries and 38,000 sales outlets have been established around the world.

It is the intention of Haier Group Company, CCT Telecom and CCTMM that further cooperation opportunities will be explored which may involve the establishment of new joint ventures and strategic alliances and acquisitions of other related businesses.

Upon completion of the Agreement, Haier Group Company will appoint three directors to the board of directors of CCTMM. The new board of directors of CCTMM will comprise four representatives from CCT Telecom, three representatives from Haier Group Company and two independent non-executive directors.

Reasons for the acquisition

Whilst CCT Telecom remains committed to the telecom product manufacturing and distribution business, it has constantly been seizing opportunities to expand the scope of its business activities with a view to meeting the challenges of the fast changing business world. The CCT Group's principal activities can broadly be categorised into three core complementary business areas: (i) manufacture and distribution of telecommunications products; (ii) provision of multimedia services; and (iii) provision of telecommunications and Internet services.

In 2000, CCT Telecom acquired CCTMM and established joint ventures with Haier Group Company. CCTMM is principally engaged in the Internet and e-commerce businesses, the provision of multimedia services and baby care product business.

Following the successful expansion of the business activities of the CCT Group, the Directors have felt the need to attach a clearer corporate identity to CCT Telecom and CCTMM, with a view to enabling a better appreciation of the value of their main businesses. In view of the imminent entry of the PRC into the World Trade Organisation, the Directors believe that the joint venture business with Haier Group Company has enormous potential and that CCTMM should focus on developing such a promising business. As such, CCTMM will transfer its multimedia business and investment, namely the Wellfit Group and its 9.8% investment in Mingpao.com Holdings Limited, to CCT Telecom. Furthermore, the Directors believe that the Proposed Acquisition creates an opportunity for the HK JV Group to exploit CCTMM's e-commerce platform for the discharge of its material sourcing and export functions for the mobile phone business.

The Directors believe that the acquisition of the mobile phone business by CCTMM from CCT Telecom and Haier Group Company and the disposal of the Wellfit Group and the 9.8% investment in Mingpao.com Holdings Limited by CCTMM to CCT Telecom are in the interests of the shareholders as a whole of both CCT Telecom and CCTMM.

On-going connected transactions

Export and Sourcing Transactions

On 3 July 2001, the HK JV and the PRC JV entered into the following arrangements:

the HK JV is to be appointed the sole sourcing agent for the PRC JV of the materials for the manufacture of mobile phones including electronic components, mechanic components and plastic materials; and
the HK JV is to be appointed the sole distributor of the mobile phones manufactured by the PRC JV outside mainland China.

Under the Sourcing Agreement, the HK JV will charge the PRC JV the actual costs incurred by the HK JV for the materials supplied to the PRC JV together with a sourcing fee of 4% of the actual costs to cover the handling costs incurred by the HK JV.

Under the Export Arrangement, the mobile phones manufactured by the PRC JV will be sold by the PRC JV to the HK JV at 92% of the selling price charged by the HK JV to its customers.

Currently the PRC JV is a connected person of CCT Telecom under the Listing Rules by virtue of the fact that: (i) the HK JV is a subsidiary of CCT Telecom and Haier Group Company is a substantial shareholder of the HK JV; and (ii) Haier Group Company has a 51% indirect interest in the PRC JV rendering the PRC JV an associate of Haier Group Company. Upon completion of the Agreement, the PRC JV will be a connected person of CCTMM (and therefore a connected person of CCT Telecom) by virtue of the fact that: (i) Haier Group Company will be a substantial shareholder of CCTMM; (ii) Haier Group Company has a 51% indirect interest in the PRC JV rendering the PRC JV an associate of Haier Group Company; and (iii) CCT Telecom, the controlling shareholder of CCTMM, has a 49% indirect interest in the PRC JV rendering the PRC JV an associate of CCT Telecom. Accordingly, transactions between the HK JV, which will become a subsidiary of CCTMM upon completion of the Agreement, and the PRC JV will constitute connected transactions for CCTMM and CCT Telecom.

The Directors expect that the aggregate amount of the Export and Sourcing Transactions on an on- going basis for the year ending 31 December 2001 will exceed 3% of the respective net tangible asset values of the CCTMM Group and the CCT Group. The Directors consider that it is impracticable to disclose details of the Export and Sourcing Transactions and to seek shareholders' approval thereof each time the Export and Sourcing Transactions arise. CCT Telecom has previously obtained from the Stock Exchange a waiver in respect of the disclosure and approval requirements of certain on-going connected transactions subject to the conditions set out in CCT Telecom's announcement dated 2 March 2001. The nature of such on-going connected transactions are in substance almost the same as the Export and Sourcing Transactions. CCTMM and CCT Telecom will seek approval from each of the independent CCTMM Shareholders and the independent CCT Shareholders for the Export and Sourcing Transactions and will each apply for a new waiver from the Stock Exchange for the financial year ending 31 December 2001 subject to the following conditions:

the Export and Sourcing Transactions are:

(a) conducted on normal commercial terms and in the ordinary and usual course of business of the CCTMM Group or the CCT Group (as the case may be);

(b) fair and reasonable so far as the independent shareholders of CCTMM or CCT Telecom (as the case may be) are concerned;

(d) conducted in accordance with the Sourcing Agreement or the Export Arrangement (as the case may be);

(a) the aggregate value of the transactions under the Sourcing Agreement for the financial year ending 31 December 2001 shall not exceed HK$3 billion; and

(b) the aggregate value of the transactions under the Export Arrangement for the financial year ending 31 December 2001 shall not exceed HK$2.2 billion (each, the “Waiver Limit”);

approval by the independent CCTMM Shareholders or the independent CCT Shareholders (as the case may be) in respect of the Export and Sourcing Transactions and the Waiver Limit;
an independent financial adviser will be appointed to advise the CCTMM Shareholders or the CCT Shareholders (as the case may be) in respect of the Export and Sourcing Transactions and the Waiver Limit;
details of the Export and Sourcing Transactions will be disclosed in the annual report of CCTMM or CCT Telecom (as the case may be) in accordance with the requirements of the Listing Rules;
the independent non-executive directors of CCTMM or CCT Telecom (as the case may be) shall review the Export and Sourcing Transactions and confirm in the annual report that such transactions have been conducted in the manner as stated in paragraph 1 above;
the auditors of CCTMM or CCT Telecom (as the case may be) shall review the Export and Sourcing Transactions and confirm the terms of the Export and Sourcing Transactions (including the sourcing fee under the Sourcing Agreement and the pricing policy under the Export Arrangement) in the annual report together with a letter addressed to the board of directors of CCTMM or CCT Telecom (as the case may be) and a copy to the Stock Exchange stating that the Export and Sourcing Transactions:

(a) have received the approval of the independent non-executive directors of CCTMM or CCT Telecom (as the case may be);

(b) have not exceeded the Waiver Limit; and

(c) have been entered into in accordance with the pricing policy under the Sourcing Agreement or the Export Arrangement (as the case may be); and

in the event that:

(a) the total amount of the Export and Sourcing Transactions has exceeded the Waiver Limit; or

(b) there are any material amendments to the terms of the Export and Sourcing Transactions,

CCTMM or CCT Telecom (as the case may be) will, in relation to the Export and Sourcing Transactions, comply with the applicable provisions of the Listing Rules governing connected transactions or will apply for a waiver from strict compliance with the relevant requirements.

Further, in relation to compliance with condition 7 mentioned above, the directors of CCTMM or CCT Telecom (as the case may be) confirm that the auditors of CCTMM or CCT Telecom (as the case may be) will have access to the books and records of the PRC JV pursuant to the right of CCTMM or CCT Telecom (as the case may be) under the Sourcing Agreement and the Export Arrangement to appoint its own auditors for the PRC JV.

If any of the value of the Export and Sourcing Transactions exceeds the Waiver Limit or if any conditions of the Export and Sourcing Transactions as mentioned above are altered or if CCTMM or CCT Telecom (as the case may be) enters into any new agreements with any connected persons (within the meaning of the Listing Rules) in the future, CCTMM or CCT Telecom (as the case may be) must comply with the provisions of Chapter 14 of the Listing Rules governing connected transactions unless it applies for and obtains a separate waiver from the Stock Exchange.

Provision of Services

On 21 September 2000, Foreland and CCT Technology, both being wholly-owned subsidiaries of CCT Telecom, entered into the Service Contract, under which Foreland provides CCT Technology with the following management and technical services:

(i) to provide such service, assistance and advice to CCT Technology as CCT Technology may require in relation to performance of CCT Technology's obligations under the joint venture contract in respect of the PRC JV;

(ii) to help engagement of technical or professional services relating to the operation of the PRC JV;

(iii) to provide to CCT Technology, as requested by CCT Technology from time to time and as Foreland sees fit, training, assistance and advice in connection with the business of the PRC JV or to recommend to CCT Technology such independent experts as Foreland may deem necessary;

(iv) to improve and develop the business of the PRC JV and make available such improvement to CCT Technology;

(v) to provide research and development services in respect of telecommunications products in connection with the business of the PRC JV; and

(vi) to develop new products, technology and know-how in connection with the business of the PRC JV.

The Provision of Services is for a period of 20 years commencing on 1 April 2001 (the then expected date of commencement of production by the PRC JV) until 31 March 2021, renewable automatically for successive terms of 20 years. In return for the Provision of Services, Foreland charges CCT Technology the Service Fee.

Currently, both Foreland and CCT Technology are indirect wholly-owned subsidiaries of CCT Telecom. As such, the Provision of Services falls within the exemption under Rule 14.24(3) of the Listing Rules as far as CCT Telecom is concerned before completion of the Agreement. Upon completion of the Agreement, CCT Technology will be a connected person of CCTMM by virtue of the fact that: (i) CCT Telecom is the controlling shareholder of CCTMM; (ii) CCT Technology will remain a wholly-owned subsidiary of CCT Telecom; and (iii) Foreland will become a wholly-owned subsidiary of CCTMM. Accordingly, transactions between Foreland and CCT Technology after completion of the Agreement will constitute connected transactions for CCTMM.

The CCTMM Directors consider that the disclosure and CCTMM Shareholders' approval of the Provision of Services each time the service is provided in full compliance with the Listing Rules will be impractical because the Provision of Services will occur on an ongoing basis. CCTMM will apply to the Stock Exchange for a waiver from strict compliance with the disclosure and the CCTMM Shareholders' approval requirements in respect of the Provision of Services for the two financial years ending 31 December 2001 and 31 December 2002, subject to the following conditions:

the Provision of Services is:

(a) conducted on normal commercial terms and in the ordinary and usual course of business of the CCTMM Group;

(b) fair and reasonable so far as the independent shareholders of CCTMM are concerned;

(d) conducted in accordance with the Service Contract;

the aggregate value of the Service Fee under the Service Contract shall not exceed the Service Fee Waiver Limit;
approval by the independent CCTMM Shareholders in respect of the Provision of Services and the Service Fee Waiver Limit;
an independent financial adviser will be appointed to advise the CCTMM Shareholders in respect of the Provision of Services and the Service Fee Waiver Limit;
details of the Service Contract will be disclosed in the annual report of CCTMM in accordance with the requirements of the Listing Rules;
the independent non-executive directors of CCTMM shall review the Provision of Services and confirm in the annual report of CCTMM that such transactions have been conducted in the manner as stated in paragraph 1 above;
the auditors of CCTMM shall review the Provision of Services and confirm the terms of the Provision of Services in the annual report of CCTMM together with a letter addressed to the board of CCTMM Directors and a copy to the Stock Exchange stating that:

(a) the Provision of Services has received the approval of the independent non-executive directors of CCTMM;

(b) the Service Fee has not exceeded the Service Fee Waiver Limit; and

in the event that:

(a) the total amount of the Service Fee has exceeded the Service Fee Waiver Limit; or

(b) there are any material amendments to the terms of the Service Contract,

CCTMM will, in relation to the Provision of Services, comply with the applicable provisions of the Listing Rules governing connected transactions or will apply for a waiver from strict compliance with the relevant requirements.

The Service Fee Waiver Limit is the amount of the monthly Service Fee specified in the Service Contract up to 31 December 2002. Pursuant to the Service Contract, the Service Fee for each of the 12 months ending 31 March 2002 and 31 March 2003 is HK$5 million per month. The CCTMM Directors will seek further approvals from the independent CCTMM Shareholders and waivers in respect of the rest of the term of the Service Contract in due course.

If the value of the Provision of Services exceeds the Service Fee Waiver Limit or if any conditions of the Provision of Services as mentioned above are altered or if CCTMM enters into any new agreements with any connected persons (within the meaning of the Listing Rules) in the future, CCTMM must comply with the provisions of Chapter 14 of the Listing Rules governing connected transactions unless it applies for and obtains a separate waiver from the Stock Exchange.

CCTMM will seek approval from the CCTMM Shareholders independent of CCT Telecom for the Provision of Services up to 31 December 2002 at the Special General Meeting.

Change of name

The CCTMM Directors propose that the name of CCTMM be changed to “Haier-CCT Holdings Limited” in order to reflect the strategic alliance between CCTMM's controlling shareholder, CCT Telecom, and its new substantial shareholder, Haier Group Company. The proposed change of name is conditional upon: --

(1) completion of the Agreement;

(2) the passing of a special resolution at the Special General Meeting by the CCTMM Shareholders to approve the change of name; and

(3) the approval by the Registrar and a certified resolution by the CCTMM Shareholders of the change of name being filed with the Registrar.

CCTMM will carry out the necessary filing procedures with the Registrar of Companies in Hong Kong. Upon the proposed change of name becoming effective, the Chinese translation of the new name of CCTMM for identification purposes will be changed from “中建數碼媒體集團有限公司” to “海爾中建集團有限公司”. A further announcement will be made upon the change of name of CCTMM becoming effective.

General

Upon completion of the Agreement, the shareholding of the public (excluding the CCT Group, Haier Group Company and its subsidiaries, the Directors and their associates) in CCTMM will be reduced to approximately 7.1%. The executive directors of CCTMM and CCTMM have undertaken to the Stock Exchange to take appropriate actions to ensure that sufficient public float exists for the Shares in accordance with the requirements of Rule 8.08 of the Listing Rules within one month from completion of the Agreement.

If upon completion of the Agreement, the Stock Exchange believes that:

˙ a false market exists or may exist in the Shares; and

˙ there are too few Shares in public hands to maintain an orderly market,

then it will consider exercising its discretion to suspend the trading in the Shares.

The CCTMM Directors will endeavour to arrange for placement(s) of new and/or existing Shares to independent third parties with a view to restoring the public float of CCTMM as soon as practicable after completion of the Agreement. A further announcement, entailing (amongst other things) the steps taken to restore the public float of CCTMM, will be made in due course.

The Stock Exchange will closely monitor all acquisitions or disposals of assets of CCTMM. The Stock Exchange has the discretion to require CCTMM to issue an announcement and/or a circular to CCTMM Shareholders irrespective of the size of the proposed transactions. The Stock Exchange also has the power to aggregate a series of transactions and any such transactions may result in CCTMM being treated as if it were a new applicant for listing. The Stock Exchange has indicated that in the event that CCTMM exercises the PRC JV Option and/or the CCT Technology Option within 12 months after the date of completion of the Agreement, the Stock Exchange may consider aggregating the interests acquired pursuant to the exercise of the PRC JV Option and/or the CCT Technology Option with the Proposed Acquisition.

The Proposed Acquisition constitutes a discloseable and connected transaction for CCT Telecom and a major and connected transaction for CCTMM for the purposes of the Listing Rules. CCT Telecom and its associates will abstain from voting in respect of the resolutions to approve the Agreement, the Export and Sourcing Transactions and the Provision of Services at the Special General Meeting. An application will be made to the Stock Exchange for the listing of and permission to deal in the Consideration Shares and the PRC JV Option Shares. The PRC JV Option Shares will, subject to the relevant regulatory approvals, be issued in the event that CCTMM exercises the PRC JV Option.

Ernst and Young Corporate Finance Limited has been retained as the financial adviser to CCT Telecom and CCTMM in connection with the Agreement. An independent board committee of each of CCT Telecom and CCTMM shall be set up, and an independent financial adviser to each of CCT Telecom and CCTMM shall be appointed for the purpose of providing independent advices to the respective independent board committees, the independent CCT Shareholders and the independent CCTMM Shareholders. A circular containing information (amongst other things) regarding the Proposed Acquisition, the notice of the Extraordinary General Meeting or the Special General Meeting (as the case may be) and the advice of the relevant independent board committee of CCT Telecom or CCTMM will be despatched to the CCT Shareholders or the CCTMM Shareholders as soon as possible.

At the request of CCTMM, trading in the shares of CCTMM has been suspended with effect from 10:00 a.m. on 5 July 2001. Application has been made to the Stock Exchange for the resumption of share trading with effect from 10:00 a.m. on 13 July 2001.

Definitions


“Agreement”	the conditional agreement dated 4 July 2001 entered into between CCT Telecom and Orient Rich as vendors, CCTMM as purchaser and Haier Group Company as warrantor for the sale and purchase of the Sale Shares (as amended by a supplemental agreement dated 11 July 2001)
“associate”	has the meaning as given to it in the Listing Rules
“CCT Group”	CCT Telecom and its subsidiaries
“CCT Shareholder(s)”	shareholder(s) of CCT Telecom
“CCT Technology”	CCT Technology Group Holdings Limited, a company incorporated in the British Virgin Islands with limited liability, an indirect wholly-owned subsidiary of CCT Telecom and which holds a 49% interest in the PRC JV and a 100% interest in Foreland
“CCT Technology Option”	an option conferring upon CCTMM the right to purchase the 100% interest in CCT Technology
“CCT Telecom”	CCT Telecom Holdings Limited, a company incorporated in the Cayman Islands with limited liability and the shares of which are listed on the Stock Exchange
“CCTMM”	CCT Multimedia Holdings Limited, a company incorporated in Bermuda with limited liability and the shares of which are listed on the Stock Exchange
“CCTMM Director(s)”	director(s) of CCTMM
“CCTMM Group”	CCTMM and its subsidiaries
“CCTMM Shareholder(s)”	shareholder(s) of CCTMM
“Consideration Business”	the issued share capital of each of Creditop International Inc. and Master Base Investments Inc.
“Consideration Shares”	5,734,000,000 ordinary Shares of HK$0.10 each in the capital of CCTMM
“Directors”	directors of CCT Telecom and CCTMM
“Export and Sourcing Transactions”	the transactions arising under the Export Arrangement and the Sourcing Agreement
“Export Arrangement”	the letter of intent dated 3 July 2001 entered into between the HK JV and the PRC JV relating to the appointment of the HK JV by the PRC JV as its sole distributor outside mainland China of the mobile phones manufactured by the PRC JV
“Extraordinary General Meeting”	extraordinary general meeting of the CCT Shareholders to be convened to consider and, if thought fit, approve the Agreement and the Export and Sourcing Transactions
“Foreland”	Foreland Agents Limited, a company incorporated in the British Virgin Islands with limited liability, a wholly-owned subsidiary of CCT Technology and which holds a 51% beneficial interest in the HK JV
“Foreland Shares”	all the ordinary shares in issue in the capital of Foreland
“Haier Group Company”	海爾集團公司 (Haier Group Company), a company incorporated in the PRC and the holding company of Orient Rich
“Haier Investments”	青島海爾投資發展有限公司, a company incorporated in the PRC with limited liability, a wholly-owned subsidiary of Haier Group Company and owns a 51% interest in the PRC JV
“Haier Shares”	9,800,000 ordinary shares of HK$1.00 each in the capital of the HK JV
“HK JV”	Haier CCT (H.K.) Telecom Co., Limited, a company incorporated in Hong Kong with limited liability
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC
“Listing Rules”	Rules Governing the Listing of Securities on the Stock Exchange
“Loan Note”	the loan note with a principal amount of HK$60,000,000 to be issued by CCTMM to CCT Telecom
“Orient Rich”	Orient Rich (H.K.) Limited, a company incorporated in Hong Kong, a wholly-owned subsidiary of Haier Group Company and owns the Haier Shares
“PRC”	the People's Republic of China
“PRC JV”	海爾CCT(青島)通訊有限公司, Haier CCT (Qingdao) Telecom Co., Ltd., a Sino-foreign equity joint venture
“PRC JV Option”	an option conferring upon CCTMM the right to purchase the 51% interest in the PRC JV owned by Haier Group Company
“PRC JV Option Shares”	the 3,366,000,000 new Shares to be issued by CCTMM to Haier Group Company or its nominee(s) upon the exercise of the PRC JV Option
“Proposed Acquisition”	the proposed acquisition of the Sale Shares as contemplated under the Agreement
“Provision of Services”	the transactions arising under the Service Contract
“Registrar”	the Registrar of Companies in Bermuda
“Sale Shares”	the Foreland Shares and the Haier Shares
“Service Contract”	the technical service and management agreement dated 21 September 2000 entered into between Foreland and CCT Technology
“Service Fee”	the service fee which shall be paid by CCT Technology to Foreland for the Provision of Services commencing on 1 April 2001
“Service Fee Waiver Limit”	the amount of monthly Service Fee specified in the Service Contract up to 31 December 2002
“Shareholder's Loan”	the interest-free loan due from Foreland to CCT Technology as at the date of completion of the Agreement
“Share(s)”	the ordinary share(s) of HK$0.10 each in the capital of CCTMM
“Sourcing Agreement”	the agreement dated 3 July 2001 entered into between the HK JV and the PRC JV for the sourcing of materials by the HK JV for the PRC JV for the manufacture of mobile phones
“Special General Meeting”	special general meeting of the CCTMM Shareholders to be convened to consider and, if thought fit, approve the Agreement, the Export and Sourcing Transactions and the Provision of Services
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Wellfit Group”	Wellfit Multi Media and its subsidiaries
“Wellfit Multi Media”	Wellfit Multi Media Group Limited, a company incorporated in the British Virgin Islands and indirectly wholly-owned by CCTMM
“HK$”	Hong Kong dollar(s), the lawful currency of Hong Kong
“%”	per cent.

By Order of the Board of
CCT Telecom Holdings Limited
Mak Shiu TongChairman

By Order of the Board of
CCT Multimedia Holdings Limited
Tsoi Tong Hoo TonyDirectorHong Kong, 12 July 2001

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