Registered Capital Revised

At the 11th Meeting of the 4th Board of Directors and the 11th Meeting of the 4th Board of Supervisors, both held on 18 Aug 2008, the following proposals were examined and approved:

1. the 2008 Semiannual Report and its Abstract
2. to write-off losses on bad debts which resulted from a reform project of the No. 3 and No. 4 paper machine wire sections
3. to revise the registered capital of the company to RMB 721,419,960 following the distribution of a stock dividend of five shares for every 10 shares held
4. to revise certain items in the Articles of Association of the company
5. to continue to use idle-raised funds of RMB 400 mln to supplement the company's working capital from 8 Nov 2008 to 7 May 2009
6. to hold the 1st 2008 Extraordinary General Meeting of Shareholders on 18 Sept 2008, at which voting on the above-mentioned proposals will be conducted conventionally at 2:30 pm, and online from 9:30 am to 11:30 am and from 1:00 pm to 3:00 pm
Shareholders may log on to the online trading system of the Shanghai Stock Exchange to register their votes. The online voting code is '738163' and the abbreviation is ‘Nanzhi Voting’.

Board of Directors and Board of Supervisors
18 Aug 2008


Source: Shanghai Stock Exchange

Date: 20 Aug 2008

CN01/RL/JL/BT/KM