The company's stock price reached its maximum intraday limit in three consecutive sessions on 13, 14 and 15 2008, thus constituting an unusual price movement.

As most of the company's debts are in arrears, creditors have filed lawsuits against the company for priority repayment and the company has lost the case, certain of the company's assets will be auctioned and its operations may be materially impacted. The company is currently actively implementing asset and debt restructuring procedures.

Following consultation with the company's largest shareholder and the senior management, the board of directors confirms that, except for the above-mentioned issue, there are no significant issues outstanding that would materially impact the company's stock price, nor are there any foreseeable within the next two weeks that require disclosure.

The China Securities Journal, the Shanghai Securities News and the website of the Shanghai Sock Exchange (www.sse.com.cn) are the company's designated media for information disclosure. Investors are advised to exercise caution when dealing in the company's shares.

Board of Directors
16 Oct 2008


Source: Shanghai Stock Exchange

Date: 16 Oct 2008

CN01/CJ/JL/JE/KM