UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

[X]      ANNUAL  REPORT  PURSUANT  TO  SECTION  13 OR  15(D)  OF THE  SECURITIES
         EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2005

[_]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
         EXCHANGE ACT OF 1934

Commission file number 000-49715

                        CHINA DIGITAL COMMUNICATION GROUP
--------------------------------------------------------------------------------
                 (Name of small business issuer in its charter)


                       Nevada                             91-2132336
-----------------------------------------     ----------------------------------
          (State or other jurisdiction of              (I.R.S. Employer
           incorporation or organization)             Identification No.)

 Number 2222. Jin Tian Road. An Lian
              Building 15th
      Floor A-01 and A-02. Futian,
            Shenzhen, China                                   518026
----------------------------------------------     -----------------------------
(Address of principal executive offices)                    (Zip Code)

Issuer's telephone number, including area code: 86-755-2698-3767

Securities registered under Section 12(b) of the Exchange Act:  None

Securities registered under Section 12(g) of the Exchange Act: Common Stock, par
value $0.001 per share

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [X]
No [_]

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

         Indicate by check mark whether the  registrant  is a shell  company (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

         The Company's  revenues from continuing  operations for its fiscal year
ended December 31, 2005 were $12,637,645.

         The aggregate  market value as at March 22, 2006 of the issuer's Common
Stock, its only class of voting stock, held by non-affiliates  was approximately
$21,238,591. For purposes of this computation, all executive officers, directors
and 10% stockholders were deemed affiliates.  Such a determination should not be
construed as an admission that such 10% stockholders are affiliates.

<PAGE>

         The number of shares outstanding of the issuer's Common Stock as at
March 22, 2005 was 72,960,626.

                       DOCUMENTS INCORPORATED BY REFERENCE

None.

Transitional Small Business Disclosure Format   Yes [  ]   No  [X]




<PAGE>

                                TABLE OF CONTENTS

                                                                            PAGE

FORWARD LOOKING STATEMENTS.....................................................1

                                     PART I

ITEM 1.  Description of Business...............................................1
ITEM 2.  Description of Property..............................................13
ITEM 3.  Legal Proceedings....................................................13
ITEM 4.  Submission of Matters to a Vote of Security Holders..................14

                              PART II

ITEM 5.  Market for Common Equity, Related Stockholder Matters and Small

         Business Issuer Purchases of Equity Securities.......................14
ITEM 6.  Management's Discussion and Analysis or Plan of Operation............15
ITEM 7.  Financial Statements.................................................21
ITEM 8.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.................................................21
ITEM 8A. Controls and Procedures..............................................21
ITEM 8B. Other Information....................................................21

                             PART III

ITEM 9.  Directors and Executive Officers of the Registrant; Compliance with
         Section 16(a) of the Exchange Act....................................22
ITEM 10. Executive Compensation...............................................26
ITEM 11. Security Ownership of Certain Beneficial Owners and Management and
         Related Stockholder Matters..........................................28
ITEM 12. Certain Relationships and Related Transactions.......................30
ITEM 13. Exhibits.............................................................30
ITEM 14. Principal Accountant Fees and Services...............................31

Financial Statements.........................................................F-1



<PAGE>

                           FORWARD LOOKING STATEMENTS

         We have included and from time to time may make in our public filings,
press releases or other public statements, certain statements, including,
without limitation, those under "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in Part II, Item 7. In some cases
these statements are identifiable through the use of words such as "anticipate,"
"believe," "estimate," "expect," "intend," "plan," "project," "target," "can,"
"could," "may," "should," "will," "would" and similar expressions. You are
cautioned not to place undue reliance on these forward-looking statements. In
addition, our management may make forward-looking statements to analysts,
investors, representatives of the media and others. These forward-looking
statements are not historical facts and represent only our beliefs regarding
future events, many of which, by their nature, are inherently uncertain and
beyond our control.

         The nature of our business makes predicting the future trends of our
revenues, expenses and net income difficult. The risks and uncertainties
involved in our businesses could affect the matters referred to in such
statements and it is possible that our actual results may differ materially from
the anticipated results indicated in these forward looking statements. Important
factors that could cause actual results to differ from those in the
forward-looking statements include, without limitation:

         o        the effect of political, economic and market conditions and
                  geopolitical events;

         o        the actions and initiatives of current and potential
                  competitors;

         o        our reputation;

         o        investor sentiment; and

         o        other risks and uncertainties detailed under "Risk Factors" in
                  Part I and elsewhere throughout this report.

         Accordingly, you are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date on which they are
made. We undertake no obligation to update publicly or revise any
forward-looking statements to reflect the impact of circumstances or events that
arise after the dates they are made, whether as a result of new information,
future events or otherwise except as required by applicable law. You should,
however, consult further disclosures we may make in future filings of our Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form
8-K, and any amendments thereto.

                                     PART 1

ITEM 1.       DESCRIPTION OF BUSINESS.

OVERVIEW

         We were incorporated in Nevada on March 27, 2001 under the name
Jasmine's Garden. In November 2004, we acquired Billion Electronic Co., Ltd., a
company organized under the laws of the British Virgin Islands ("Billion"), and
its wholly owned operating subsidiary, Shenzhen E'Jenie Technology Development
Co., Ltd, a company incorporated under the laws of the Peoples Republic of China
("E'Jenie"). Through E'Jenie we manufacture and distribute lithium battery
shells and related products primarily in China. Based upon specifications from
its customers E'Jenie develops, customizes and produces steel, aluminum battery
shells and aluminum caps. Currently, E'Jenie produces fourteen steel



                                       1
<PAGE>

battery shell lines, nine aluminum battery shell lines, three aluminum battery
cap lines and three steel battery cap lines.

HISTORY

         Until December 2, 2003, we operated a nationwide wholesale and retail
business selling greeting cards, note cards and gift tags made from a design
process involving photography and computer graphics. On December 2, 2003,
Cheering Limited, an investment holding company organized under the laws of the
British Virgin Islands ("Cheering"), acquired 5,700,000 shares of our common
stock, par value $0.001, which constituted approximately 95% of the then issued
and outstanding shares of our common stock from Jack and Jasmine Gregory, our
former officers and directors, for cash consideration of $221,221 (the "Cheering
Transaction").

         In connection with the Cheering Transaction, our Board of Directors
appointed Zu Zhuan Xu to serve as our President, elected four designees of
Cheering to serve to serve as directors, and Jack and Jasmine Gregory resigned
from their positions as officers and directors of the Company. On February 18,
2004, Zu Zhuan Xu resigned as President and Yi Bo Sun was appointed as President
and Chief Executive Officer and Xu Bao Dong was appointed to serve on our Board
of Directors. On February 19, 2004, another director resigned from our Board of
Directors and Mr. Sun was appointed to replace him. On January 19, 2006, Mr. Sun
resigned as our President and Chief Executive Office and from our Board of
Directors. Changchun Zheng was elected as Chairman of the Board and Chief
Executive Officer.


         On March 17, 2004, we sold 30,000,000 shares of common stock at a per
share purchase price of $0.05 to seven unaffiliated individuals in a private
placement, which yielded aggregate gross proceeds of $1,500,000 (the "Private
Placement"). As a condition to the closing of the Private Placement, each of the
investors executed an irrevocable proxy granting Mr. Sun, our former President
and Chief Executive Officer, the right to vote all shares of the common stock
purchased in the Private Placement. The irrevocable proxies expired on May 1,
2004, however, the investors and Mr. Sun extended the irrevocable proxies to May
2006. Mr. Sun as the Chairman and Chief Executive Officer of Cheering is the
beneficial owner of the 5,700,000 shares of common stock, which represents
approximately 7.8%, of the issued and outstanding shares of our common stock and
prior to the expiration of the irrevocable proxies, Mr. Sun will have the power
to vote or direct the voting of 30,000,000 shares issued in the Private
Placement. As a result, until the irrevocable proxies expire on may 1, 2006, Mr.
Sun will control approximately 48.9% of our issued and outstanding common stock.

         On April 28, 2004, we filed a certificate of amendment to our articles
of incorporation with the Nevada Secretary of State to increase our authorized
common stock to 140,000,000 shares and to authorize 60,000,0000 shares, par
value $0.001, of blank check preferred stock.

         On September 3, 2004, we filed a certificate of amendment to our
articles of incorporation with the Nevada Secretary of State to change our name
from "Jasmine's Garden" to "China Digital Communication Group."

ACQUISITION OF BILLION

         On November 15, 2004, pursuant to the terms of a Share Exchange
Agreement (the "Exchange Agreement") dated as of September 17, 2004, by and
among the Company, Billion, the shareholders of Billion (the "Shareholders") and
E'Jenie, we acquired from the Shareholders (the "Acquisition") all of the issued
and outstanding equity interests of Billion (the "Billion Shares"). Billion is a
holding company and the sole shareholder of E'Jenie. Billion has no other assets
other than the shares of E'Jenie. As consideration for the Billion Shares, we
paid the Shareholders an aggregate of $1,500,000 in cash and issued them
4,566,210 shares of our common stock. The consideration for the Acquisition was


                                       2
<PAGE>

determined through arms length negotiations between us and Billion. As a result
of the Acquisition we are the sole shareholder of Billion through which we own
all of the issued and outstanding equity interests of E'Jenie.

         In connection with the Acquisition we entered into a Guarantee
Agreement, dated October 9, 2004, as amended October 11, 2004 (the "Guarantee"),
with Shiji Ruichen Guaranty and Investment Co. Ltd., a company incorporated
under the laws of the Peoples Republic of China ("Shiji"). Pursuant to the terms
of the Guarantee, Shiji agreed to guarantee our performance and the performance
of the Shareholders under the Exchange Agreement. As consideration for Shiji's
guaranty, we issued 1,919,016 shares of our common stock to Shiji. As security
for our obligations under the Guarantee, one of our principal shareholders
deposited 5,000,000 of their shares of our common stock into escrow.

INDUSTRY

         The lithium battery was created in the 1990s, with its first mass
production in 1993 in Japan. Lithium batteries were first used in notebook
computers and now are used in cellular phones, video machines, lab tops, digital
cameras, digital cams, MPS players, global positioning satellite systems, 3G
communication devises, hybrid cars and an array of other electronic products.

         Batteries are becoming smaller, lighter, more efficient, longer lasting
and free of pollution. The lithium battery's energy/weight ratio exceeds that of
its counterparts and with an excellent safety standard we believe that it is the
future of the battery industry. China has become one of the largest producer and
consumer of lithium ion batteries. According to China Chemistry and Physics
Electronic Industry Association, there were over $4.0 billion of lithium ion
batteries sold in China in 2005. We anticipate that there will be even greater
demand for lithium batteries in China and worldwide in the next few years. We
believe that the current trend towards smaller, lighter portable consumer
products will continue to grow and because of its size, the demand for the
lithium battery will increase. By way of example, a mobile-phone battery has a
typical usage life of 300 to 500 recharges, which translates to a ratio of 1.8
batteries in service life of each phone, according to official Chinese
statistics. However, our internal data reveals that battery replacement demand
is faster than this when consumers turn in their phones for new models before
the normal life of the battery is over. A short product life combined with a
short product innovation cycle creates rapid product turnover resulting in
increased business for battery shell makers.

BUSINESS STRATEGY

         We seek to maintain and strengthen our position as a provider of
battery shells and caps while increasing the breadth of our product line and
improving the quality of our products. In order to achieve our objective, we
plan to pursue the key strategies described below.

         o        Become a cost leader in an increasingly competitive market. We
                  believe we can ensure competitive pricing by integrating a
                  labor-intensive production process with high-tech, proprietary
                  manufacturing equipment. We believe our experience in
                  designing and updating key manufacturing equipment and
                  operating such equipment at a low cost gives us a cost
                  advantage over our competitors.

         o        Taking advantage of our ready production capacity and allowing
                  for increased production capacity. We believe our production
                  capacity makes us more reliable, flexible and responsive in
                  terms of fulfilling our customers' requirements than other
                  providers. As such, existing and potential competitors may
                  find it more difficult to compete with our production
                  capabilities.


                                       3
<PAGE>

         o        Enhanced research and development activities. Upon completion
                  of our new facility, we will have the space to enhance our
                  existing research and development capabilities through the
                  addition of state of the art equipment and experienced
                  personnel.

         o        Expanding our product lines to capture new market
                  opportunities. We are seeking to produce lithium battery cells
                  that can be used in small electronic consumer products such as
                  digital cameras, laptop computers, MP3 players and cellular
                  telephones. By entering these markets, we believe we can
                  achieve future revenue growth and improved profit margins.

PRODUCTS

         Our wholly-owned subsidiary, E'Jenie, is a producer of the lithium ion
battery shells and caps listed below.

         Low-Carbon Steel Stretch Series. This square shape shell series
stretches the low-carbon steel plate section by section. We use superficial
galvanization to custom make sizes for different customers. The characteristics
of this series are that it is clean and artistic, it has smooth cuttings, and is
explosion proof, wear resistant and anti-corrosive. This series is suitable for
square shaped nickel hydrogen batteries, lithium ion batteries and power
batteries.

         F6, F8 Nickel Hydrogen and Lithium Ion Duel Functions Series. This
series stretches the low-carbon steel plate section by section and uses oil
pressure to make the final form. The characteristic of this series is a smooth
surface. This series is suitable for nickel Hydrogen and Lithium Ion Duel
Functions Rechargeable Battery Cells.

         Square Share Stainless Steel Series. This series uses a unique
processing craft to stretch stainless steel to make the square steel. The
characteristics of this series are that it is anticorrosive and it does not
rust. This series is suitable for the square shaped Nickel Hydrogen and Lithium
Ion Battery and related components.

         Aluminum Square Shell Series. This series is developed by us by
continuously extruding to form the final shell shapes. The characteristic of
this series is that it is explosion proof.

         Japanese Explosion-Proof Cap Series. Included in this series is the
Japanese Steel Plate Patent Product Series and the Stainless Steel
Explosion-Proof Cap Series. The characteristics of the Japanese Steel Plate
Patent Series are as follows:

         o        Low Pressure. It can be used under low pressure condition. The
                  pressure is effected by the thickness of the aluminum sheet
                  and the diameter of holes within the caps.

         o        Strong Resistance. The aluminum material will not become stiff
                  or rigid and therefore the product will not crack if it is
                  hit.

         o        Expanding the Gas Releasing Volume. When the safety value is
                  on the gas will be released.

         The Japanese Steel Plate Patent Product Series is suitable for all
types of lithium ion batteries.

         The Stainless Steel Explosion-Proof Cap Series was developed by us and
for which we own a patent. This series is suitable for lithium ion batteries
used in mobile phones, calculators, MP3 players, digital camera, and recorders
and other electronic devices.


                                       4
<PAGE>

CUSTOMERS

         In 2005, our five largest customers represented approximately 63% of
our total sales. The following table sets forth information regarding our five
largest customers.

<TABLE>
<CAPTION>
                                                 LIST OF MAJOR CUSTOMERS
------------------------------------------------------------ ---------------------------------------------------------
                     Name of Customer                                  Percentage of Total Revenue for 2005
                     ----------------                                  ------------------------------------
------------------------------------------------------------ ---------------------------------------------------------
<S>                                                                                   <C>
                       Shenzhen Bak                                                   30.19%
------------------------------------------------------------ ---------------------------------------------------------
      Shenzhen Gao Yi Electronic Technology Co., Ltd.                                 13.29%
------------------------------------------------------------ ---------------------------------------------------------
       Dong Wan Mai Ke New Energy Resource Co., Ltd.                                  8.46%
------------------------------------------------------------ ---------------------------------------------------------
             Shenzhen Hua Bao Battery Co. Ltd.                                        6.00%
------------------------------------------------------------ ---------------------------------------------------------
          Shenzhen Yin Si Qi Electronic Co., Ltd.                                     5.46%
------------------------------------------------------------ ---------------------------------------------------------
</TABLE>


         Although we do not have formal contracts with our customers, we have
established long-term relationships. Our customers place orders on a monthly
basis and sales are processed with purchase orders. The loss of Shenzhen Bak as
a customer would have an adverse effect on our revenues as sales to Shenzhen Bak
represented approximately 30.19% of total sales for 2005. We believe that our
relationship with Shenzhen Bak is good and do not anticipate a change in their
current volume of business.


SALES AND MARKETING

         We focus our sales and marketing initiatives on establishing China
Digital as the leading manufacturer of caps and shells for lithium ion
batteries. We promote our brand in order to build revenues, gain worldwide
market share and promote consumer awareness and acceptance. Our in-house sales
and marketing team contact local battery manufacturers to solicit interest in
our products. If the manufacturer expresses an interest in our product offering,
we ship them samples and if our products suit their needs orders are placed and
filled. As of March 15, 2006, we had nine sales and marketing personnel who all
were located in China.

INTELLECTUAL PROPERTY

         We protect our proprietary technology through various methods such as
patents and patent applications, trademarks, non-disclosure agreements and trade
secrets. We have filed and obtained a number of patents in China. As of March
15, 2006 we have been issued three patents by the China National Intelligent
Assets Bureau. The expiration of these patents range from May 8, 2005 to May 8,
2015.

         We intend to continue to pursue the legal protection of our technology
through intellectual property laws. However, we cannot be certain that the steps
we have taken to protect our intellectual property rights will be adequate or
that third parties will not infringe or misappropriate our propriety rights.

MANUFACTURING AND RAW MATERIALS.

         We purchase various components and raw materials for use in our
manufacturing processes. The principal raw materials we purchase are aluminum
and steel. The price of steel has increased significantly




                                       5
<PAGE>

in the past year, and we believe that it will continue to increase. The
increases have had an adverse impact on gross margins, since some of the
increases cannot be passed on to our customers.


         Our three largest suppliers are Heng Yuang Li Stainless Steel Factory,
Hongzhou Stainless Steel Product Co and Hua Yi Aluminum Co., which in the
aggregate account approximately 50% of all components and raw materials
purchased. Normally, the annual purchase plan for raw material, such as aluminum
and steel, is determined at the beginning of the calendar year according to past
customer's orders and our own sales forecast. Such purchase plans with key
suppliers can be revised quarterly. Our actual requirements are based on weekly
production plans. We believe that this arrangement protects us from inventory
surplus when the orders from customers change.

         For raw materials other than steel and aluminum, we normally maintain
from one week up to one month of inventory at our warehouse. All components and
raw materials are available from numerous sources. We have not experienced any
significant shortages of manufactured components or raw materials and normally
do not carry inventories of these items in excess of what is reasonably required
to meet our production and shipping schedules.

REGULATORY MATTERS; ENVIRONMENTAL CONSIDERATION

         All factories in China must adhere to standards set forth by the
Environmental Department and each factory must receive special permission from
the Environmental Department to operate. We have officially received permission
from the Environmental Department.

 COMPETITION

         The worldwide market for lithium battery shells and caps is highly
competitive. We face competition from manufacturers not only within China but
also from other parts of the world, particularly Japan, Taiwan, Malaysia,
Indonesia, and Korea. We compete with these companies by striving to provide a
higher quality product at a lower cost. Our primary competitors are Shenzhen
Luhua Co., Ltd., Shenzhen TongLi Electronic Co. and Ningbo Pulaite Electronics
Co., Ltd. We believe that by doing business in China we enjoy competitive
advantages over similar companies based elsewhere, such as abundant labor
resources and low cost raw materials.

EMPLOYEES

         We currently have eight employees, five of which are officers, two of
which are executives and one administrative personnel. E'Jenie has nine
divisions with 596 employees in total, 39 of which are supervisors, 14 of which
are administrative officers, nine of which are in marketing and 534 of which are
on the production lines. The Labor Law of the China requires us to provide the
certain benefits and insurance to all of its employees. We consider our
relationships with our employees to be good.

DOING BUSINESS IN CHINA

         The Chinese Legal System

         The practical effect of the People's Republic of China legal system on
our business operations in China can be viewed from two separate but intertwined
considerations. First, as a matter of substantive law, the Foreign Invested
Enterprise laws provide significant protection from government interference. In
addition, these laws guarantee the full enjoyment of the benefits of corporate
Articles and contracts to Foreign Invested Enterprise participants. These laws,
however, do impose standards concerning corporate formation and governance,
which are not qualitatively different from the general corporation laws of the


                                       6
<PAGE>

several states. Similarly, the People's Republic of China accounting laws
mandate accounting practices, which are not consistent with U.S. Generally
Accepted Accounting Principles. China's accounting laws require that an annual
"statutory audit" be performed in accordance with People's Republic of China
accounting standards and that the books of account of Foreign Invested
Enterprises are maintained in accordance with Chinese accounting laws. Article
14 of the People's Republic of China Wholly Foreign-Owned Enterprise Law
requires a Wholly Foreign-Owned Enterprise to submit certain periodic fiscal
reports and statements to designate financial and tax authorities, at the risk
of business license revocation.

         Second, while the enforcement of substantive rights may appear less
clear than United States procedures, the Foreign Invested Enterprises and Wholly
Foreign- Owned Enterprises are Chinese registered companies, which enjoy the
same status as other Chinese registered companies in business-to-business
dispute resolution. Generally, the Articles of Association provide that all
business disputes pertaining to Foreign Invested Enterprises are to be resolved
by the Arbitration Institute of the Stockholm Chamber of Commerce in Stockholm,
Sweden applying Chinese substantive law. Any award rendered by this arbitration
tribunal is, by the express terms of the respective Articles of Association,
enforceable in accordance with the "United Nations Convention on the Recognition
and Enforcement of Foreign Arbitral Awards (1958)." Therefore, as a practical
matter, although no assurances can be given, the Chinese legal infrastructure,
while different in operation from its United States counterpart, should not
present any significant impediment to the operation of Foreign Invested
Enterprises such as E'Jenie.

         Although the Chinese government owns the majority of productive assets
in China, in the past several years the government has implemented economic
reform measures that emphasize decentralization and encourage private economic
activity. Because these economic reform measures may be inconsistent or
ineffectual, there are no assurances that:

         o        We will be able to capitalize on economic reforms.

         o        The Chinese government will continue its pursuit of economic
                  reform policies.

         o        The economic policies, even if pursued, will be successful.

         o        Economic policies will not be significantly altered from time
                  to time.

         o        Business operations in China will not become subject to the
                  risk of nationalization.

         Since 1979, the Chinese government has reformed its economic systems.
Because many reforms are unprecedented or experimental, they are expected to be
refined and improved. Other political, economic and social factors, such as
political changes, changes in the rates of economic growth, unemployment or
inflation, or in the disparities in per capita wealth between regions within
China, could lead to further readjustment of the reform measures. This refining
and readjustment process may negatively affect our operations.

         Over the last few years, China's economy has registered a high growth
rate. Recently, there have been indications that rates of inflation have
increased. In response, the Chinese government recently has taken measures to
curb this excessively expansive economy. These measures have included
devaluations of the Chinese currency, the renminbi, restrictions on the
availability of domestic credit, reducing the purchasing capability of certain
of its customers, and limited re-centralization of the approval process for
purchases of some foreign products. These austerity measures alone may not
succeed in slowing down the economy's excessive expansion or control inflation,
and may result in severe dislocations in the Chinese economy. The Chinese
government may adopt additional measures to further combat inflation, including
the establishment of freezes or restraints on certain projects or markets.


                                       7
<PAGE>

         To date reforms to China's economic system have not adversely impacted
our operations and are not expected to adversely impact operations in the
foreseeable future; however, there can be no assurance that the reforms to
China's economic system will continue or that we will not be adversely affected
by changes in China's political, economic, and social conditions and by changes
in policies of the Chinese government, such as changes in laws and regulations,
measures which may be introduced to control inflation, changes in the rate or
method of taxation, imposition of additional restrictions on currency conversion
and remittance abroad, and reduction in tariff protection and other import
restrictions.

RISK FACTORS

                          RISKS RELATED TO OUR BUSINESS

         WE DEPEND ON THE CONTINUED SERVICES OF OUR EXECUTIVE OFFICERS AND THE
LOSS OF KEY PERSONNEL COULD AFFECT OUR ABILITY TO SUCCESSFULLY GROW OUR
BUSINESS.


         We are highly dependent upon the services of our senior management
team, particularly Changchun Zhen, our Chairman and Chief Executive Officer and
Yao Miao, our Chief Financial Officer. The permanent loss for any of our key
executives, could have a material adverse effect upon our operating results. We
may not be able to locate suitable replacements for our executives if their
services were lost. We do not maintain key man life insurance on any of these
individuals.

         OUR OPERATIONS DEPEND ON OUR ABILITY TO ATTRACT AND RETAIN A HIGHLY
SKILLED GROUP OF MANAGERS AND OTHER PERSONNEL.

            Because of the highly specialized, technical nature of our business,
we must attract and retain a highly skilled group of managers and a sizeable
workforce of technically competent employees. Although we do not experience
unacceptable attrition among our technical staff and sales force, if we were to
lose a substantial portion of such persons, our ability to effectively pursue
our business strategy could be materially and negatively affected. Although we
believe our management and workers having the necessary education, training and
technical skills to fill any positions that may become open is sufficient for
our needs, the labor market for such managers and workers is becoming more
competitive and we could have to pay higher salaries and wages and provide
greater benefits in order for us to attract the necessary workers.

         IF WE CANNOT EFFECTIVELY INCREASE AND ENHANCE OUR SALES AND MARKETING
CAPABILITIES, WE MAY NOT BE ABLE TO INCREASE OUR REVENUES.

         We need to further develop our sales and marketing capabilities to
support our commercialization efforts. If we fail to increase and enhance our
marketing and sales force, we may not be able to enter new or existing markets
for lithium ion batteries. Failure to recruit, train and retain new sales
personnel, or the inability of new sales personnel to effectively market and
sell our products, could impair our ability to gain market acceptance of our
products and services and cause our sales to suffer.

         WE MAY NOT BE ABLE TO EFFECTIVELY MANAGE OUR ANTICIPATED GROWTH.

         If we fail to effectively manage our internal growth in a manner that
minimizes strains on our recourses, we could experience disruptions in our
operations and ultimately be unable to sustain profitability. Furthermore we
anticipate that we will significantly expand our operations over the next few
years. Managing our anticipated growth may be difficult because:


                                       8
<PAGE>

         o        our management team has worked together for a relatively short
                  period of time; and

         o        we intend to purse acquisitions, joint ventures and other
                  strategic transactions that will enhance or expand out
                  technology and manufacturing base.

         WE MAY NOT BE ABLE TO SUCCESSFULLY IDENTIFY, CONSUMMATE OR INTEGRATE
STRATEGIC TRANSACTIONS.

         We intend to pursue strategic transactions that provide access to new
technologies, products, markets and manufacturing abilities. These transactions
could include acquisitions, partnerships, joint ventures, business combinations
and investments. In particular, we intend to focus our acquisition efforts on
companies that will provide us with a new and established customer base. We may
not be able to identify any potential strategic transactions. Even if we do
identify one or more potentially beneficial strategic transactions, we may not
be able to consummate these transactions on favorable terms or obtain the
benefits we anticipate from such a transaction. If we are able to consummate any
strategic transactions, the transactions could pose significant integration
challenges or management and business disruptions.

         A LIMITED NUMBER OF CUSTOMERS GENERATE A SIGNIFICANT PORTION OF OUR
REVENUE.

         For the near future, we expect that a significant portion of our
revenues will be concentrated in a limited number of customers. For example, for
the year ended December 31, 2005, revenues from five customers represented
approximately 63% of our total revenues from operations. A reduction, delay, or
cancellation of orders from one or more of our customers or the loss of one or
more customer relationships could significantly reduce our revenues. Unless we
establish long-term sales arrangements with these customers, they will have the
ability to discontinue their purchases of our products on short notice.

                    RISKS RELATED TO DOING BUSINESS IN CHINA

         ADVERSE CHANGES IN ECONOMIC AND POLITICAL POLICIES OF THE CHINESE
GOVERNMENT COULD HAVE A MATERIAL ADVERSE EFFECT ON THE OVERALL ECONOMIC GROWTH
OF CHINA, WHICH COULD ADVERSELY AFFECT OUR BUSINESS.

         Substantially all of our business operations are conducted in China.
Accordingly, our results of operations, financial condition and prospects are
subject to a significant degree to economic, political and legal developments in
China. China's economy differs from the economies of most developed countries in
many respects, including with respect to the amount of government involvement,
level of development, growth rate, control of foreign exchange and allocation of
resources. While the Chinese economy has experienced significant growth in the
past 20 years, growth has been uneven across different regions and among various
economic sectors of China. The Chinese government has implemented various
measures to encourage economic development and guide the allocation of
resources. Some of these measures benefit the overall Chinese economy, but may
also have a negative effect on us. For example, our financial condition and
results of operations may be adversely affected by government control over
capital investments or changes in tax regulations that are applicable to us.
Since early 2004, the Chinese government has implemented certain measures to
control the pace of economic growth. Such measures may cause a decrease in the
level of economic activity in China, which in turn could adversely affect our
results of operations and financial condition.

         RESTRICTIONS ON CURRENCY EXCHANGE MAY LIMIT OUR ABILITY TO RECEIVE AND
USE OUR REVENUES EFFECTIVELY.

         Because a substantial amount of our revenues are in the form of
Renminbi, the Chinese currency unit, any restrictions on currency exchanges may
limit our ability to use revenue generated in Renminbi to


                                       9
<PAGE>

fund any future business activities outside China. Although the Chinese
government introduced regulations in 1996 to allow greater convertibility of the
Renminbi for current account transactions, significant restrictions still
remain, including primarily the restriction that foreign-invested enterprises
may only buy, sell or remit foreign currencies, after providing valid commercial
documents, at those banks authorized to conduct foreign exchange business. In
addition, conversion of Renminbi for capital account items, including direct
investment and loans, is subject to government approval in China, and companies
are required to open and maintain separate foreign exchange accounts for capital
account items. If the currency exchange system prevents us from obtaining
sufficient foreign currency, we may be unable to fund business activities
outside China or otherwise make payments in dollars. We cannot be certain that
the Chinese regulatory authorities will not impose more stringent restrictions
on the convertibility of the Renminbi, especially with respect to foreign
exchange transactions. The value of our common stock will be affected by the
foreign exchange rate between U.S. dollars and Renminbi.

         To the extent that we need to convert U.S. dollars into Renminbi for
our operational needs, should the Renminbi appreciate against the U.S. dollar at
that time, our financial position and the price of our common stock may be
adversely affected. Conversely, if we decide to convert our Renminbi into U.S.
dollars and the U.S. dollar appreciates against the Renminbi, the U.S. dollar
equivalent of our earnings from our subsidiaries in China would be reduced.

         Until 1994, the Renminbi experienced a gradual but significant
devaluation against most major currencies, including U.S. dollars, and there was
a significant devaluation of the Renminbi on January 1, 1994 in connection with
the replacement of the dual exchange rate system with a unified managed floating
rate foreign exchange system. Since 1994, the value of the Renminbi relative to
the U.S. dollar has remained stable and has appreciated slightly against the
U.S. dollar. Countries, including the United States, have argued that the
Renminbi is artificially undervalued due to China's current monetary policies
and have pressured China to allow the Renminbi to float freely in world markets.
On July 21, 2005 the Chinese government changed its policy of pegging the value
of the Renminbi to the U.S. dollar. Under the new policy the Renminbi is
permitted to fluctuate within a narrow and managed band against a basket of
designated foreign currencies. While the international reaction to the Renminbi
revaluation has generally been positive, there remains significant international
pressure on the Chinese government to adopt an even more flexible currency
policy, which could result in further and more significant appreciation of the
Renminbi against the U.S. dollar.

         Any significant revaluation of the Renminbi may materially and
adversely affect our revenues, cash flow, earnings and financial position, and
the value of any dividends payable in U.S. dollars. For example, an appreciation
of the Renminbi against the dollar would make any Renminbi denominated
investment or expenditure more costly to us, to the extent that we use dollars
that we must convert into Renminbi for such purpose.

         WE MAY BE UNABLE TO ENFORCE OUR LEGAL RIGHTS DUE TO POLICIES REGARDING
THE REGULATION OF FOREIGN INVESTMENTS IN CHINA.

         The Chinese legal system is a civil law system based on written
statutes, in which system decided legal cases have little value as precedents
unlike the common law system prevalent in the United States. China does not have
a well-developed, consolidated body of laws governing foreign investment
enterprises. As a result, the administration of laws and regulations by
government agencies are subject to considerable discretion and variation on the
part of the Chinese government, including its courts, and may be subject to
influence by external forces unrelated to the legal merits of a particular
matter. China's regulations and policies with respect to foreign investments are
evolving. Definitive regulations and policies with respect to such matters as
the permissible percentage of foreign investment and permissible rates of equity
returns have not yet been published. As a result, we may not be aware of any
violations of these policies and rules until some time after the violation.
Statements regarding these evolving policies



                                       10
<PAGE>

have been conflicting and any such policies, as administered, are likely to be
subject to broad interpretation and discretion and to be modified, perhaps on a
case-by-case basis. The uncertainties regarding such regulations and policies
present risks that may affect our ability to achieve our business objectives. If
we are unable to enforce any legal rights we may have under our contracts or
otherwise, our ability to compete with other companies in our industry could be
materially and negatively affected. In addition, any litigation in China may be
protracted and result in substantial cost and diversion of resources and
management attention.

         THERE CAN BE NO GUARANTEE THAT CHINA WILL COMPLY WITH THE MEMBERSHIP
REQUIREMENTS OF THE WORLD TRADE ORGANIZATION.

         Due in part to the relaxation of trade barriers following World Trade
Organization accession in January 2002, we believe China will become one of the
world's largest markets by the middle of the twenty-first century. As a result,
we believe the Chinese market presents a significant opportunity for both
domestic and foreign companies. With the Chinese accession to the World Trade
Organization, Chinese industries are gearing up to face the new regimes that are
required by World Trade Organization regulation. The Chinese government has
begun to reduce its average tariff on pharmaceuticals and healthcare products.
China has also agreed that foreign companies will be allowed to import most
products, including pharmaceuticals, into any part of China. Current trading
rights and distribution restrictions are to be phased out over a three-year
period. In the sensitive area of intellectual property rights, China has agreed
to implement the trade-related intellectual property agreement of the Uruguay
Round. However, there can be no assurances that China will implement any or all
of the requirements of its membership in the World Trade Organization in a
timely manner, if at all.

         IT MAY BE DIFFICULT TO SERVE US WITH LEGAL PROCESS OR ENFORCE JUDGMENTS
AGAINST OUR MANAGEMENT OR US.

         All or a substantial portion of our assets are located in China. In
addition, most of our directors and officers are non-residents of the United
States, and all or substantial portions of the assets of such non-residents are
located outside the United States. As a result, it may not be possible to effect
service of process within the United States upon such persons. Moreover, there
is doubt as to whether the courts of China would enforce:

         o        judgments of United States courts against us, our directors or
                  our officers based on the civil liability provisions of the
                  securities laws of the United States or any state; or

         o        in original actions brought in China, liabilities against
                  non-residents or us based upon the securities laws of the
                  United States or any state.

                   RISKS RELATED TO THE OWNERSHIP OF OUR STOCK

         OUR STOCK PRICE IS HIGHLY VOLATILE.

            The market price of our common stock may fluctuate significantly in
response to a number of factors, some of which are beyond our control,
including:

         o        quarterly variations in operating results;

         o        changes in financial estimates by securities analysts;


                                       11
<PAGE>

         o        announcements by us or our competitors of new products or of
                  significant technical innovations, contracts, acquisitions,
                  strategic partnerships or joint ventures;

         o        changes in governmental regulations or policies in China;

         o        additions or departures of key personnel;

         o        any deviations in net sales or in losses from levels expected
                  by securities analysts; and the operating and stock price
                  performance of other comparable companies;

         o        news and commentary emanating from the media, securities
                  analysts or government bodies in China relating to us and to
                  the industry in general; and

         o        future sales of common stock.

         General market conditions and domestic or international macroeconomic
factors unrelated to our performance may also affect our stock price. For these
reasons, investors should not rely on recent trends to predict future stock
prices or financial results. In addition, following periods of volatility in a
company's securities, securities class action litigation against a company is
sometimes instituted. This type of litigation could result in substantial costs
and the diversion of management's time and resources.

         BECAUSE OUR SECURITIES TRADE ON THE OTC BULLETIN BOARD SELLING OUR
SECURITIES IN THE SECONDARY MARKET MAY BE DIFFICULT.

         Our shares of common stock have been listed and principally quoted on
the Nasdaq OTC Bulletin Board since May 1994. Because our securities currently
trade on the OTC Bulletin Board, they are subject to the rules promulgated under
the Securities Exchange Act of 1934, as amended, which impose additional sales
practice requirements on broker-dealers that sell securities governed by these
rules to persons other than established customers and "accredited investors"
(generally, individuals with a net worth in excess of $1,000,000 or annual
individual income exceeding $200,000 or $300,000 jointly with their spouses).
For such transactions, the broker-dealer must determine whether persons that are
not established customers or accredited investors qualify under the rule for
purchasing such securities and must receive that person's written consent to the
transaction prior to sale. Consequently, these rules may adversely effect the
ability of purchasers to sell our securities and otherwise affect the trading
market in our securities. Because our shares are deemed "penny stocks," there
may be difficulty in selling them in the secondary trading market.

         The Securities and Exchange Commission has adopted regulations which
generally define a "penny stock" to be any equity security that has a market
price (as defined in the regulations) less than $5.00 per share or with an
exercise price of less than $5.00 per share, subject to certain exceptions.
Additionally, if the equity security is not registered or authorized on a
national securities exchange or Nasdaq, the equity security also would
constitute a "penny stock." As our common stock falls within the definition of
penny stock, these regulations require the delivery, prior to any transaction
involving our common stock, of a risk disclosure schedule explaining the penny
stock market and the risks associated with it. Disclosure is also required to be
made about compensation payable to both the broker-dealer and the registered
representative and current quotations for the securities. In addition, monthly
statements are required to be sent disclosing recent price information for the
penny stocks. The ability of broker/dealers to sell our common stock and the
ability of shareholders to sell our common stock in the secondary market would
be limited. As a result, the market liquidity for our common stock would be
severely and adversely affected. We can provide no assurance that trading in our
common stock will not be subject to these or other regulations in the future,
which would negatively affect the market for our common stock.


                                       12
<PAGE>

         OUR FORMER PRESIDENT AND CHIEF EXECUTIVE OFFICER HAVE EFFECTIVE VOTING
CONTROL OF THE COMPANY.

         Yi Bo Sun, our former President and Chief Executive Officer and a
former director, is also the Chief Executive Officer and Chairman of the Board
of Cheering Limited. As a result, Mr. Sun may be entitled to direct the vote of
the 5,700,000 shares of our common stock (or approximately 7.8% of our issued
and outstanding common stock) owned by Cheering Limited. Additionally, until May
1, 2006 Mr. Sun is also entitled to direct the vote of an additional 30,000,000
shares of common stock that are owned by seven investor, for a total of
35,700,000 shares (approximately 48.9% of our issued and outstanding common
stock) pursuant to certain irrevocable proxies granted to him in connection with
the private placement of such securities to certain individuals. Upon the
expiration of these proxies (and assuming that such proxies are not extended),
the investors as a group will be able to exercise effective control over any
matters requiring the vote of stockholders, including the approval of any
business acquisition and the election of directors assuming no further
issuances. This could delay or prevent a change in control of our board of
directors. This may have the effect of precluding or delaying the opportunity of
minority stockholders to sell their common stock to interested purchasers or may
significantly reduce the offering price in any such transaction.

         WE DO NOT INTEND TO PAY DIVIDENDS ON OUR COMMON STOCK.

         We have not paid any dividends on our common stock to date and there
are no plans for paying dividends in the foreseeable future. We intend to retain
earnings, if any, to provide funds for the implementation of our new business
plan. We do not intend to declare or pay any dividends in the foreseeable
future. Therefore, there can be no assurance that holders of common stock will
receive any additional cash, stock or other dividends on their shares of common
stock until we have funds, which the Board of Directors determines, can be
allocated to dividends.

         OUR ARTICLES OF INCORPORATION CONTAIN PROVISIONS THAT DISCOURAGE A
CHANGE OF CONTROL.

         Our articles of incorporation contain provisions that could discourage
an acquisition or change of control without our board of directors' approval.
Our articles of incorporation authorize our board of directors to issue
preferred stock without shareholder approval. If our board of directors elects
to issue preferred stock, it could be more difficult for a third party to
acquire control of us, even if that change of control might be beneficial to our
shareholders.

ITEM 2. DESCRIPTION OF PROPERTY.

         Our manufacturing headquarters is located at A-3 Xinglian Industrial
Zone, He Hua Ling Pingxin Road, Xin Nan, Ping Hua Town, Longgang, Shenzhen,
China 51811. This facility is 6,708 square meters of which 15% or 1,000 square
meters is used for offices, 4,500 square meters are used for the manufacturing
line and storage and the remaining 1,208 square meters are used for employee
dormitories. Our lease is for a term of one year and our rent is approximately
$6,700 a month

         In February 2005, we opened our first office in the United States. The
Los Angeles-based office is located at 1901 Avenue of the Stars, Suite 201. Our
lease is for a term of one year and our rent is $1,225 a month.

         We believe the facilities we occupy are adequate for the purposes for
which they are currently used and are well maintained:

ITEM 3. LEGAL PROCEEDINGS


                                       13
<PAGE>

         We are not a party to any pending litigation and none is contemplated
or threatened.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         There were no matters submitted to the stockholders in the fourth
quarter of our fiscal year ended December 31, 2005.

                                    PART II

ITEM 5.       MARKET FOR THE COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.


         Our common stock trades under the symbol CHID.OB on the
Over-the-Counter Bulletin Board Electronic Quotation System maintained by the
National Association of Securities Dealers, Inc. Following is information about
the range of high and low bid prices for our common stock for the each fiscal
quarters listed below. Prior to the Acquisition, there was a limited market for
our common stock. As a result, our stock had no or nominal trading volume and a
very limited trading history. These quotations reflect inter-dealer prices,
without retail mark-up, mark-down or commission, and may not necessarily
represent actual transactions.

<TABLE>
<CAPTION>
               Quarter Ended                     High Bid Quotation         Low Bid Quotation
               -------------                     ------------------         -----------------
<S>                                                      <C>                   <C>
       June 30, 2004                                     $3.50                 $1.03
       September 30, 2004                                $3.40                 $1.50
       December 31, 2004                                 $2.50                 $0.99
       March 31, 2005                                    $1.60                 $0.78
       June 30, 2005                                     $1.45                 $0.31
       September 30, 2005                                $1.87                 $0.42
       December 31, 2005                                 $0.54                 0.38$
</TABLE>


HOLDERS

         As of March 22, 2006, there were 145 holders of record of our common
stock, however, we believe that there are additional beneficial owners of our
common stock who own their shares in "street name."

DIVIDENDS

         There have been no cash dividends declared on our common stock since
inception. Dividends are declared at the sole discretion of our board of
directors. It is not anticipated that any dividends will be declared for the
foreseeable future on our common stock.

RECENT SALES OF UNREGISTERED SECURITIES

         In March 2004, we sold 30,000,000 shares of our common stock at a per
share purchase price of $0.05 to seven unaffiliated individuals in a private
placement, which yielded aggregate gross proceeds of $1,500,000. The shares were
issued pursuant to an exemption provided by Section 4(2) of the Securities Act
of 1933, as amended.

         As consideration for the Acquisition, we issued 4,566,210 shares of
common stock to the Shareholders. As consideration for Shiji's guaranty, we
issued 1,919,016 shares of common stock to Shiji in October 2004. The shares
were issued pursuant to an exemption provided by Section 4(2) of the Securities
Act of 1933, as amended.


                                       14
<PAGE>


ITEM 6.       MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

         The following discussion should be read in conjunction with the
Consolidated Financial Statements and Notes thereto appearing elsewhere in this
Form 10-KSB. The following discussion contains forward-looking statements. Our
actual results may differ significantly from those projected in the
forward-looking statements.

         The following table presents the results of operations for the year
ended December 31, 2005 and the pro forma results of operations of E'Jenie (the
accounting predecessor company) for the period from January 1, 2004 to November
15, 2004 and the consolidated results of China Digital (the accounting successor
company) from November 16, 2004 (inception) to December 31, 2004. The discussion
following the table is based on the results of operations for the year ended
December 31, 2005 and pro forma results of operations of E'Jenie (the accounting
predecessor company) for the period from January 1, 2004 to November 15, 2004
and the consolidated results of China Digital (the accounting successor company)
from November 16, 2004 (inception) to December 31, 2004.

<TABLE>
<CAPTION>
                                                      YEAR ENDED         JANUARY 1, 2004     NOVEMBER 16,       YEAR ENDED
                                                      DECEMBER 31,       - NOVEMBER 15,      2004 - DECEMBER    DECEMBER 31,
                                                      2005               2004                31, 2004           2004
                                                                         (PREDECESSOR)       (SUCCESSOR)        (PRO FORMA)
                                                 -----------------     -----------------     -----------------  -----------------
Statement of Earnings Data:
<S>                                                 <C>                   <C>                   <C>                   <C>
Net revenues                                        $12,742,088           $ 2,843,404           $ 2,338,718           $ 5,182,122
---------------------------------------------------------------------------------------------------------------------------------
Net income (loss)                                     2,624,279               328,645               111,851               440,496
Per Common Share Data:
---------------------------------------------------------------------------------------------------------------------------------
Earnings (loss)
Basic & Diluted                                             .05                  .009                  .003                  .012
---------------------------------------------------------------------------------------------------------------------------------
Balance Sheet Data:
Total assets                                          7,318,149             1,999,445             4,751,536             4,751,536
---------------------------------------------------------------------------------------------------------------------------------
Long-term debt                                                0                     0                     0                     0
Weighted Average Number of Common Shares:
---------------------------------------------------------------------------------------------------------------------------------
Basic                                                54,460,626            37,758,202            39,172,889            39,172,889

Diluted                                              54,460,626            37,758,202            39,172,889            39,172,889
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>


OVERVIEW

         We were incorporated in Nevada on March 27, 2001 under the name
Jasmine's Garden to sell greeting cards, note cards and related products. The
business operations generated limited revenues and operated at a loss since
inception. On September 3, 2004, in contemplation of the transactions discussed
below, we changed our name to China Digital Communication Group.


         On December 2, 2003, Cheering Limited, an investment holding company
organized under the laws of the British Virgin Islands ("Cheering"), acquired
5,700,000 shares of our common stock, par value $0.001, which constituted
approximately 95% of the then issued and outstanding shares of common stock from
Jack and Jasmine Gregory, the Company's former officers, directors and principal
stockholders, for cash consideration of $221,221 (the "Cheering Transaction").


                                       15
<PAGE>

         On March 17, 2004, we sold 30,000,000 shares or approximately 62% of
our issued and common stock at a per share purchase price of $0.05 to seven
unaffiliated individuals in a private placement, which yielded aggregate gross
proceeds of $1,500,000 (the "Private Placement").

         On November 15, 2004, pursuant to the terms of a Share Exchange
Agreement (the "Exchange Agreement") dated as of September 17, 2004, by and
among the Company, Billion, the shareholders of Billion (the "Shareholders") and
E'Jenie, we acquired from the Shareholders (the "Acquisition") all of the issued
and outstanding equity interests of Billion (the "Billion Shares"). As
consideration for the Billion Shares, we paid the Shareholders an aggregate of
$1,500,000 in cash and issued them 4,566,210 shares of common stock.

         As a result of the Cheering Transaction, the Private Placement and the
Acquisition transactions, we have had a change of our management, our
controlling shareholders, our financial position and our business plan. China
Digital became a holding company and has no significant business operations or
assets other than its interest in E'Jenie, the accounting predecessor company.
Since China Digital, the accounting successor company, had no significant
business operations or assets prior to the Acquisition described above,
presenting comparative periods would not be meaningful. As such, the results of
operations presented below for the predecessor are those of E'Jenie.


RESULTS OF OPERATIONS

COMPARISON OF FISCAL YEAR 2005 COMPARED TO FISCAL YEAR 2004

         The following table presents the statement of operations for the year
ended December 31, 2005 and the pro forma results of operations for the periods
ended of January 1, 2004 to November 15, 2004 (for the predecessor company) and
November 16, 2004 to December 31, 2004 (for the successor company). The
discussion following the table is based on the pro forma results.

<TABLE>
<CAPTION>
                                                                             JANUARY 1, 2004     NOVEMBER 16,      PRO FORMA
                                                           YEAR ENDED        NOVEMBER 15,        2004              FOR THE YEAR
                                                           DECEMBER 31,      2004                -DECEMBER 30,     ENDED
                                                           2005              (PREDECESSOR)       2004              DECEMBER 31,
                                                                                                 (SUCCESSOR)       2004
---------------------------------------------------------------------------- ------------------  ----------------  -----------------
<S>                                                        <C>               <C>                 <C>               <C>
NET SALES                                                  $     12,742,088  $       2,843,404   $     2,338,718   $      5,182,122
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
COST OF SALES                                                     8,971,859          2,334,892         1,294,346          3,629,238
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
GROSS PROFIT                                                      3,770,230            508,512         1,044,372          1,552,884
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
OPERATING EXPENSES:
------------------------------------------------------------------------------------------------------------------------------------
Selling, general and administrative                               1,005,198            115,507           880,498            996,005
------------------------------------------------------------------------------------------------------------------------------------
Research and development                                                  0                  0                 0                  0
------------------------------------------------------------------------------------------------------------------------------------
Amortization of intangibles                                               0                  0                 0                  0
------------------------------------------------------------------------------------------------------------------------------------
Total operating expenses                                          1,005,198            115,507           880,498            996,005
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
Operating income (loss)                                           2,765,031            393,005           163,874            556,879
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME                                                       3,877              1,991              (139)             1,852
------------------------------------------------------------------------------------------------------------------------------------


                                       16
<PAGE>

------------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE                                                     32,856             23,114             7,384             30,498
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
Income (loss) before benefit for income taxes                     2,736,052            371,882           156,351            528,233
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
BENEFIT (PROVISION) FOR INCOME TAXES                               (111,773)           (43,237)          (44,500)           (87,737)
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS)                                          $      2,624,279   $        328,645    $      111,851   $        440,496
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


NET SALES

         Net sales for 2005 totaled $12,742,088 compared to $5,182,122 for 2004,
an increase of $7,559,966, or approximately 146%. The increase was due to the
expansion of our product lines in order to meet the needs of our customers.
Shenzhen Bak increased its orders by 16% in 2005 and two new customers, Shenzhen
Gao Yi and Dongwan Mai Ke, placed orders that represented 22% of our 2005
revenues.

COST OF SALES

         Cost of sales for 2005 totaled $8,971,859, or approximately 70.4% of
net sales, compared to $3,629,238, or approximately 70% of net sales, for 2004.
The increase in cost of sales as a percentage of net sales was due to an
increase in the cost of raw materials from the introduction of new product lines
during 2004. As we increased our sales revenue in 2005 our cost of sales has
also increased. Although the cost of raw materials in 2005 increased, we were
able to reduce other costs and improve efficiency, which resulted no change in
our gross margin from 2004.

OPERATING EXPENSE

         Selling, general and administrative, and consulting fees for 2005
totaled $1,005,198, or approximately 7.9% of net sales, compared to $996,005, or
approximately 19% of net sales, for 2004. This increase in operating expenses of
$9,193, or approximately 1%, was due to the increase in the number of our
employees and customers in 2005.

INCOME (LOSS) FROM OPERATIONS

         Income (loss) from operations for 2005 was $2,765,031 as compared to
income from operations of $556,879 for 2004, an increase of $2,208,152, or
approximately 397%. This increase was due to the increase in our sales revenue.

INTEREST EXPENSE

         Interest expense for 2005 totaled $32,856 compared to $30,498 for 2004,
an increase of $2,358. The increase in interest expense was due to indebtedness
related to the acquisition of fixed assets.

NET INCOME

         Net income (loss) was $2,624,279 for 2005 compared to net income of
$440,496 for 2004, an increase of $2,183,783. The increase was due to an
increase in our sales revenue.

COMPARISON OF FISCAL YEAR 2004 COMPARED TO FISCAL YEAR 2003


                                       17
<PAGE>

         The following table presents the pro forma statement of operations for
the periods of January 1, 2004 to November 15, 2004 (for the predecessor
company) and November 16, 2004 to December 31, 2004 (for the successor company)
as compared to the comparable period of the year ended December 31, 2003 (for
the predecessor). The discussion following the table is based on the pro forma
results.

<TABLE>
<CAPTION>
                                                     JANUARY 1,          NOVEMBER 16,          PRO FORMA
                                                       2004 -                 2004            FOR THE YEAR       YEAR ENDED
                                                    NOVEMBER 15,          DECEMBER 30,          ENDED            DECEMBER 31,
                                                        2004                 2004             DECEMBER 31,           2003
                                                   (PREDECESSOR)         -(SUCCESSOR)            2004            PREDECESSOR)
-----------------------------------------------------------------------------------------------------------------------------
<S>                                                  <C>                 <C>                 <C>                 <C>
NET SALES                                            $ 2,843,404         $ 2,338,718         $ 5,182,122         $ 2,061,528

COST OF SALES                                          2,334,892           1,294,346           3,629,238           1,810,126

GROSS PROFIT                                             508,512           1,044,372           1,552,884             251,402

OPERATING EXPENSES:
Selling, general and administrative                      115,507             880,498             996,005             116,713
Research and development                                       0                   0                   0                   0
Amortization of intangibles                                    0                   0                   0                   0
Total operating expenses                                 115,507             880,498             996,005             116,713

Operating income (loss)                                  393,005             163,874             556,879             134,689

OTHER INCOME                                              1,991                 (139)              1,852              23,545

INTEREST EXPENSE                                          23,114               7,384              30,498                 145

Income (loss) before benefit for income taxes            371,882             156,351             528,233             158,089

BENEFIT (PROVISION) FOR INCOME TAXES                     (43,237)            (44,500)            (87,737)            (25,937)

NET INCOME (LOSS)                                    $   328,645         $   111,851         $   440,496         $   132,152
</TABLE>


NET SALES

         Net sales for 2004 totaled $5,182,122 compared to $2,061,528 as of
2003, an increase of $3,120,594, or approximately 151%. This increase was due to
the expansion of our product lines to meet the needs of our existing clients and
to service new clients in 2004 as compared to 2003.


COST OF SALES

         Cost of sales for 2004 totaled $3,629,238 or approximately 70% of net
sales compared to $1,810,126 or approximately 58% of net sales, for 2003. This
increase in cost of sales as a percentage was due to an increase in material
cost from the introduction of new product lines during 2004.


                                       18
<PAGE>

OPERATING EXPENSE

         Selling, general and administrative, and consulting fees for 2004
totaled $996,005 or approximately 19% of net sales, compared to $116,713 or
approximately 5.66% for 2003. This increase in operating expense of $879,603 or
approximately 756% was due to the hiring of additional administrative and
marketing staff in order to build our infrastructure to meet the increased
demand for our products and to market our new products.

INCOME (LOSS) FROM OPERATIONS

         Income (loss) from operations for 2004 was $556,879 as compared to
income from operations of $134,689 for 2003, an increase of $422,190 or
approximately 363%. This increase was due to the expansion of our product lines
to meet the needs of our existing clients and to service new clients in 2004 as
compared to 2003.

INTEREST EXPENSE

         Interest expense for 2004 totaled $30,498 compared to $145 for 2003, an
increase of $30,353. This increase in interest expense was due to indebtedness
related to the acquisition of fixed assets.

NET INCOME

         Net income (loss) was $440,496 for 2004 compared to $132,152 for 2003,
an increase of $308,344. This increase was due to the expansion of our product
lines to meet the needs of our existing clients and to service new clients in
2004 as compared to 2003.

LIQUIDTY AND CAPITAL RESOURCES

         China Digital, as the successor company, had no significant business
operations or assets prior to the Acquisition. As such, the liquidity and
capital resources described below of E'Jenie are the same for China Digital.


         Cash has historically been generated from operations. Operations and
liquidity needs are funded primarily through cash flows from operations and
short-term borrowings. Cash and cash equivalents were $2,061,213 at December 31,
2005 and current assets totaled $4,765,684 at December 31, 2005. The Company's
total current liabilities were $1,507,939 at December 31, 2005. Working capital
at December 31, 2005 was $3,257,745. We believe that the funds available to us
are adequate to meet our operating needs for 2006. During 2005, net cash
provided by operating activities was $2,092,926. Cash used in financing
activities was $2,093 for 2005.


CAPITAL EXPENDITURES

         Total capital expenditures during the year ended December 31, 2005 was
$536,937.


WORKING CAPITAL REQUIREMENTS

         Historically operations and short term financing have been sufficient
to meet our cash needs. We believe that we will be able to generate revenues
from sales and raise capital through private placement offerings of its equity
securities to provide the necessary cash flow to meet anticipated working
capital requirements. However, our actual working capital needs for the long and
short term will depend upon numerous factors, including operating results,
competition, and the availability of credit facilities, none of


                                       19
<PAGE>

which can be predicted with certainty. Future expansion will be limited by the
availability of financing products and raising capital.

OFF BALANCE SHEET ARRANGEMENTS

         We have never entered into any off-balance sheet financing arrangements
and have never established any special purpose entities. We have not guaranteed
any debt or commitments of other entities or entered into any options on
non-financial assets.

CRITICAL ACCOUNTING POLICES

         The preparation of consolidated financial statements requires us to
make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. We evaluate our estimates on an on-going basis. We base our
estimates on current information, historical experience and on various other
assumptions that are believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values
of assets and liabilities that are not readily apparent from other sources.
Actual results may differ from the estimates we used under different assumptions
or conditions. We believe the following concentrations and critical accounting
policies relate to our more significant judgments and estimates used in the
preparation of our consolidated financial statements.

Revenue Recognition

         The Company's revenue recognition policies are in compliance with Staff
accounting bulletin (SAB) 104. Sales revenue is recognized at the date of
shipment to customers when a formal arrangement exists, the price is fixed or
determinable, the delivery is completed, no other significant obligations of the
Company exist and collectibility is reasonably assured. Payments received before
all of the relevant criteria for revenue recognition are satisfied are recorded
as unearned revenue.

Stock-Based Compensation

         In October 1995, the FASB issued SFAS No. 123, "Accounting for
Stock-Based Compensation". SFAS No. 123 prescribes accounting and reporting
standards for all stock-based compensation plans, including employee stock
options, restricted stock, employee stock purchase plans and stock appreciation
rights. SFAS No. 123 requires compensation expense to be recorded (i) using the
new fair value method or (ii) using the existing accounting rules prescribed by
Accounting Principles Board Opinion No. 25, "Accounting for stock issued to
employees" (APB 25) and related interpretations with proforma disclosure of what
net income and earnings per share would have been had the Company adopted the
new fair value method. The Company uses the intrinsic value method prescribed by
APB 25 and has opted for the disclosure provisions of SFAS No.123.

RECENT ACCOUNTING PRONOUNCEMENTS

         Reference is made to Note B to the Financial Statements included
elsewhere in this report for a description of certain recently issued accounting
pronouncements. We do not expect any of such recently issued accounting
pronouncements to have a material effect on our consolidated financial position
or results of operations.



                                       20
<PAGE>

ITEM 7.  FINANCIAL STATEMENTS.

The Financial Statements of the Company appear at pages F-1 to F-21.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
         ACCOUNTING AND FINANCIAL DISCLOSURE.

         We did not have any disagreement with our former accountants on
accounting and financial disclosures. Please see our Amended Form 8-K filed on
January 18, 2006 regarding our change of accountants.

ITEM 8A. CONTROLS AND PROCEDURES.

         As of the end of the period covered by this report, management of the
Company, with the participation of the Company's principal executive officer and
the Company's principal financial officer, evaluated the effectiveness of the
Company's "disclosure controls and procedures," as defined in Rule 13a-15(e)
under the Securities Exchange Act of 1934. Based on that evaluation, these
officers concluded that, as of the date of their evaluation, the Company's
disclosure controls and procedures were effective to provide reasonable
assurance that information required to be disclosed in the Company's periodic
filings under the Securities Exchange Act of 1934 is accumulated and
communicated to the Company's management, including those officers, to allow
timely decisions regarding required disclosure.

         During the period covered by this Report, there were no changes in the
Company's internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.

ITEM 8B.      OTHER INFORMATION.

         None.



                                       21
<PAGE>

                                    PART III

ITEM 9.       DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
              COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

            The following table sets forth the name, age and position of each of
our officers and directors as of March 15, 2006.

       NAME                     AGE        POSITION

       Changchun Zheng          43         Chairman and Chief Executive Officer
       Yu Xi Sun                32         President and Director
       Yao Miao                 34         Chief Financial Officer
       Hong Liang               42         Chief Operating Officer and Director
       Mei Jin Bin              28         Secretary and Director
       Xu Bao Dong              35         Director
       Zu Zhuan Xu              40         Director
       Alfred L. Simon          65         Director
       Yong Yang                43         Director

         All directors have a term of office expiring at the next annual general
meeting, unless re-elected or earlier vacated in accordance with the Bylaws. All
officers have a term of office lasting until their removal or replacement by the
Board of Directors.

         Changchun Zheng, 43, has served as Chairman and Chief Executive Officer
of China Digital since January 19, 2006. Prior to that Mr. Zheng was Chief
Executive Officer of Shenzhen ShengNuo Digital Tech Co, Ltd. Under his
leadership, he grew the company within fours years to become a recognized major
vendor of IT and communications equipment in China. From 1996 to 2001, he served
as Chief Executive Officer and Chairman of Shenzhen Hong Ye Science and Tech Co,
Ltd. During his tenure, the company became a leading scientific investment
company whose IT achievements are widely recognized in China. His experience
also includes several years in executive positions at the Construction Bank of
China, one of the largest banks in China. Mr. Zheng holds a Master of Science
degree in National Economics and Management from the Chinese Academy of Social
Science.

         Yao Miao, 34, has served as Chief Financial Officer of China Digital
since February 2004. Before assuming this role, he was CFO of Shenzhen Southern
Heng Ye Industrial Co., Ltd. From September 2002 through January 2004. He served
as the auditing manager of the accounting department at Shenzhen Run Ze
Universal Development Co., Ltd. From August 2001 through August 2002. He served
as the accounting department director at Golden Butterfly International Software
Co., Ltd. From June 1999 through July 2001. He has a Bachelor of Science degree
in economics from Hubei University, and is a certified public accountant in
China.

         Hong Liang, 42, has served as Chief Operating Officer and as a director
of China Digital since January 19, 2006. Prior to that Mr. Liang served as
Senior Project Manager at Shenzhen High Tech Investments and Guarantee Co., Ltd.
Previously, Mr. Liang served as Chief Financial Officer at Shenzhen Hua Mao
Mortgage Loan Firm; Shenzhen Hua Bao Electronic Company, Inc.; and Shenzhen Yong
Gao Industries. He is also the former Executive Editor, Southwestern University
of Finance and Economic Publishing Press. He holds both Bachelors and Masters
degree in Economics from Southwestern University of Finance and Economics in
Chengdu, China.


                                       22
<PAGE>

         Yu Xi Sun, 32, served as Vice President of Shenzhen E'Jenie Science and
Technology Development Co., Ltd. from December 2004 to February 2006, Assistant
President from September 2003 to December 2004 and Marketing Manager from May
2002 to August 2003. From January 2001 to April 2002 Ms. Sun was Marketing
Director of the Eastern China Area at Shenzhen City Li Ke Energy Co., Ltd., and
from July 1999 to December 2000 was Legal Counsel for Hubei Xing Yuan Battery
Co., Ltd. Ms. Sun earned an M.S. in Law from Hubei University.

         Mei Jin Bin, 28, has served as a director of China Digital since
February 2004. From February 2002 through June 2003 she was the executive
general manager of Shenzhen E'Jenie Science and Technology Development Co., Ltd.
From August 1999 January 2002 she served as the Executive Secretary of Shenzhen
Gao Yi Electronic Co. Ltd. She is a graduate of Hubei Province Huangshi City
Professional Institute.

         Xu Bao Dong, 35, has served as a director of China Digital since
February 2004. Since March 2003 he served as Vice President at Shenzhen Heng
Tian Tong Communication Equipment Inc. From August 2001 through February 2003 he
served as the Marketing Director at Shenzhen Li Gao Electronics. From July 1999
until July 2001 he served as Marketing Director at Shenzhen Blue Hope Electronic
Co., Ltd. He holds a Bachelors of Science degree from degree from Shenzhen
University.

         Zu Zhuan Xu, 40, has served as a director of China Digital since
December 2003. Since November 2002 he has served as the Vice Director of Human
Resources and Senior Executive Assistant at Shenzhen Xin Jia Electronics Co.,
Ltd. From May 1999 until March 2002, he was the Director of Human Resources at
Shenzhen Golden Island Biao Industrial Group. His primary job duties were to
maintain, create, and implement all programs in Human Resources. From October
1992 through April 1999 he served as the Director of Human Resources at Shenzhen
Xie Li Paper Products Co., Ltd. From April 1985 through September 1992 he served
as the Primary Executive Secretary at E Zhou Huang Wei Electronic Generators
Manufacture. Mr. Hu holds a Bachelor of Science degree from Shenzhen University.

         Alfred L. Simon, 65, has been the Principal of American Capital Group,
which provides corporate financial services specializing in merger and
acquisitions and capital fundraising since March 1, 1998. Mr. Simon began his
career as an auditor and CPA at Ernst & Ernst in 1962, and has held numerous
executive level positions since, including Chief Financial Officer at Arcata
Research Corp., partner and co-director of research at Sanford C. Bernstein &
Company, Vice President of Corporate Finance at Gruntal & Company; Director of
Corporate Finance at Mabon Nugent & Company; and Director of Investment Banking
at Philips Appel & Walden. He has also served on the Board of Directors of
Carmel Container Systems and IIC Industries. Mr. Simon holds a Harvard MBA, CPA
certification in NYSE and NASD registration as a General Securities Principal,
Financial and Operations Principal and Supervisory Analyst. He also presently
serves as a NASD Dispute Resolution Arbitrator.

         Yong Yang, 43, earned his Doctoral Degree in Chemistry from Xiamen
University (China) - University of Essex (UK). Between December 997 and December
1998, Dr. Yang attended Oxford University, where he studied Physics and
Theoretical Chemistry. Since May 1994, Dr. Yang has taught at the University of
Xiamen. Dr. Yang has published over 100 academic research papers and has four
patents in which he was the sole inventor. In 1992, he was awarded the 2nd Award
from China Education Department. Dr. Yang is also the Special Invited Editor for
"Science News Press." Dr. Yang has received multiple research grants from "China
National Science Fund," and "State Outstanding New Generation Fund" (formerly
known as the "China President Fund"), which is the highest honor and recognition
in the field of Science Research in China. Since February 1999, Dr. Yang has
served as Lead for more than 10 China National Level Research Projects.
Currently, Dr. Yang is teaching a group of 20 graduate students, including
Masters and Doctoral candidates

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS


                                       23
<PAGE>

         To our knowledge, during the past five years, our officers and
directors: have not filed a petition under the federal bankruptcy laws or any
state insolvency law, nor had a receiver, fiscal agent or similar officer
appointed by a court for the business or present of such a person, or any
partnership in which he was a general partner at or within two years before the
time of such filing, or any corporation or business association of which he was
an executive officer within two years before the time of such filing; were not
convicted in a criminal proceeding or named subject of a pending criminal
proceeding (excluding traffic violations and other minor offenses); and were not
the subject of any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining him from or otherwise limiting their respective
activities.

INDEMNIFICATION

         Under Section 145 of the Nevada General Corporation law, we have broad
powers to indemnify our directors and officers against liabilities they may
incur in such capacities, including liabilities under the Securities Act of
1933, as amended (the "Securities Act"). Our Bylaws also provide that we have
the power to indemnify our directors, officers, employees and other agents to
the maximum extent permitted by Nevada law.


         Our articles of incorporation provides for the elimination of liability
for monetary damages for breach of the directors' fiduciary duty of care to us
and our shareholders. The provision does not eliminate the directors' duty of
care and, in appropriate circumstances, equitable remedies such as injunctive or
other forms of non-monetary relief will remain available under Nevada law. In
addition, each director will continue to be subject to liability for breach of
the director's duty of loyalty to us, for acts or omissions not in good faith or
involving intentional misconduct, for knowing violations of law, for any
transaction from which the director derived an improper personal benefit, and
for payment of dividends or approval of stock repurchases or redemptions that
are unlawful under Nevada law. The provision does not affect director's
responsibilities under any other laws, such as the federal securities laws or
state or federal environmental laws.


BOARD OF DIRECTORS' MEETINGS AND COMMITTEES

         We have undergone a significant change in management and restructuring
of the Company. We are in the process of searching for outside directors to
serve on our Board of Directors.

         The Board of Directors has designated the following directors as
independent directors: Xu Bao Dong, Zu Zhuan Xu, Albert Simon and Yong Yang.

NOMINATIONS FOR DIRECTORS

         Our Board will adopt a formal policy regarding qualifications of
director candidates. Currently, in evaluating director nominees, our Board
considers a variety of factors, including the appropriate size of our Board of
Directors; our needs o with respect to the particular talents and experience of
our directors; experience with accounting rules and practices; and the desire to
balance the benefit of continuity with the periodic injection of the fresh
perspective provided by new Board members.

         To date, we have not engaged third parties to identify or evaluate or
assist in identifying potential nominees, although we reserve the right in the
future to retain a third party search firm, if necessary.

         During the fiscal year ended December 31, 2005, our Board of Directors
met six times, and our Audit Committee met two times. No director attended fewer
than 75% of the meetings of our Board or of each committee of which he was a
member.


                                       24
<PAGE>

         Our Board of Directors does not currently provide a process for
securityholders to send communications to our Board of Directors as we believe
that until this point it has been premature given the limited liquidity of our
common stock to develop such processes.

AUDIT COMMITTEE

         The Company has an audit committee charter. The audit committee: (i)
appoints the Company's independent auditors and monitors the independence of the
Company's independent auditors; (ii) reviews the Company's policies and
procedures on maintaining its accounting records and the adequacy of its
internal controls; (iii) reviews management's implementation of recommendations
made by the independent auditors and internal auditors; (iv) considers and
pre-approves the range of audit and non-audit services performed by independent
auditors and fees for such services; and (v) reviews and votes on all
transactions between the Company and any of its officers, directors or other
affiliates.

         Xu Bao Dong, Zu Zhuan Xu and Albert Simon serve on our audit committee
and are all independent directors. Albert Simon is the Chairman and audit
committee financial expert.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Section 16(a) of the Securities Exchange Act of 1934 requires certain
defined persons to file reports of and changes in beneficial ownership of a
registered security with the Securities and Exchange Commission and the National
Association of Securities Dealers in accordance with the rules and regulations
promulgated by the Commission to implement the provisions of Section 16. Under
the regulatory procedure, officers, directors, and persons who own more than ten
percent of a registered class of a company's equity securities are also required
to furnish the Company with copies of all Section 16(a) forms they file.

         To the Company's knowledge, based solely on a review of the copies of
Forms 3, 4 and 5 furnished to the Company between January 1, 2005 through
December 31, 2005, the Company's officers, directors and greater than 10%
beneficial owners complied with all Section 16(a) filing requirements except as
follows: Young Yan has not filed a Form 3 for a transaction that occurred on may
12, 2005; Albert Simon has not filed a Form 3 for transaction that occurred on
November 11, 2005.

CODE OF ETHICS

         We have adopted a Code of Ethics that applies to our principal
executive officer and senior financial officers. Please see Item 13, Exhibit
14.1.



                                       25
<PAGE>

ITEM 10.  EXECUTIVE COMPENSATION

            The following sets forth the annual and long-term compensation for
services in all capacities to us for the fiscal years ended December 31, 2005,
2004 and 2003 paid to our Chief Executive Officer and the other executive
officer who was serving as an executive officer at the end of the last completed
fiscal year. This compensation information relates to compensation received by
the named executive officer while employed by us.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                  LONG TERM COMPENSATION
                                                                      ------------------------------------------------
                                       ANNUAL COMPENSATION                    AWARDS                 PAYOUTS
                              --------------------------------------- ------------------------------------------------
  Name And Principal    Year    Salary       Bonus       Other        Restricted  Securities   LTIP      All Other
       Position                  ($)                     Annual          Stock      Under-   Payouts    Compensation
                                                      Compensation     Award(s)      Lying     ($)          ($)
                                              ($)         ($)             ($)      Options/
                                                                                   SARs (#)
<S>                    <C>       <C>          <C>         <C>            <C>         <C>       <C>          <C>
 Yi Bo Sun(1)          2005       --           --          --             --          --        --           --
                       2004       --           --          --             --          --        --           --
                       2003       --           --          --             --          --        --           --
</TABLE>

---------------
(1)      Resigned as our Chairman, President and Chief Executive Officer on
         January 19, 2006.

<TABLE>
<CAPTION>

                                OPTION GRANTS IN LAST FISCAL YEAR (JANUARY 1, 2005 - DECEMBER 31, 2005)


                             NUMBER OF       % OF TOTAL                                       POTENTIAL REALIZABLE
                             SECURITIES        OPTIONS                                          VALUE AT ASSUMED
                             UNDERLYING      GRANTED TO                                       ANNUAL RATE OF STOCK
                              OPTIONS       EMPLOYEES IN      EXERCISE       EXPIRATION      PRICE APPRECIATION FOR
NAME                        GRANTED (1)    THE FISCAL YEAR     PRICE            DATE               OPTION TERM
                                                                                                 5%          10%

<S>                           <C>               <C>            <C>                <C>           <C>           <C>
Yi Bo Sun                             --                --       --              --              --          --
</TABLE>



                                       26
<PAGE>

               AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR-END

                     AND FISCAL YEAR-END OPTION VALUES TABLE

         The following table contains information concerning the number of
shares acquired and value realized from the exercise of options by the named
executive officers during fiscal 2005 and the number of unexercised options held
by the named executive officers at December 31, 2005.

<TABLE>
<CAPTION>
                  NUMBER OF SHARES OF COMMON STOCK UNDERLYING    VALUE OF UNEXERCISED IN-THE-MONEY OPTIONS AT
                        UNEXERCISED OPTIONS AT YEAR END                YEAR END (DECEMBER 31, 2005) (1)
                               (DECEMBER 31 2005)
     NAME            EXERCISABLE            UNEXERCISABLE            EXERCISABLE           UNEXERCISABLE

<S>                      <C>                    <C>                   <C>                  <C>
Yi Bo Sun                 --                      --                     --                      --
</TABLE>


(1)      Options are "in-the-money" if the market price of a share of common
         stock exceeds the exercise price of the option.

         We have no retirement, pension or profit sharing program for the
benefit of its directors, officers or other employees, but the Board of
Directors may recommend one or more such programs for adoption in the future.

COMPENSATION OF DIRECTORS

         All directors are reimbursed for out-of-pocket expenses in connection
with attendance at Board meetings. During the fiscal year ended December 31,
2005, Albert Simon received $20,000 and options to purchase 100,000 shares of
our common stock at an exercise price equal to 115% of the average daily closing
bid price of our common stock for the 60 days prior to November 4, 2005.

BONUSES AND DEFERRED COMPENSATION

         We do not have any bonus, deferred compensation or retirement plan.

STOCK OPTIONS

         Our Board of Directors chose to make option or warrant awards to select
officers, directors, consultants, or shareholder/investors in order to induce
them to assist it in implementing its business plan and to provide long term
additional incentive. These options or warrants, as awarded, were not awarded
pursuant to a plan but were specific individual awards with varying terms and
conditions. In some instances, our Board of Directors reserved the right to
cancel these awards for non-performance or other reasons, or established a
vesting schedule pursuant to which the award is earned.

EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
ARRANGEMENTS

         There are no compensatory plans or arrangements, including payments to
be received from us, with respect to any person named in the Summary
Compensation Table above, that would in any way result in payments to any such
person because of his resignation, retirement, or other termination of such
person's employment with us or the our subsidiaries, or any change in control of
us, or a change in the person's responsibilities following a change of control.



                                       27
<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
         AND RELATED STOCKHOLDER MATTERS.

         The following table sets forth, as of March 15, 2006, certain
information regarding the ownership of voting securities of China Digital by
each stockholder known to our management to be (i) the beneficial owner of more
than 5% of our outstanding common stock, (ii) our directors, (iii) our current
executive officers and (iv) all executive officers and directors as a group. We
believe that, except as otherwise indicated, the beneficial owners of the common
stock listed below, based on information furnished by such owners, have sole
investment and voting power with respect to such shares.

<TABLE>
<CAPTION>
               NAME AND ADDRESS OF                  AMOUNT AND NATURE OF BENEFICIAL              PERCENT OF
              BENEFICIAL OWNER (1)                           OWNERSHIP(2)                   OUTSTANDING SHARES(2)
    ------------------------------------------  ----------------------------------------  --------------------------

<S>                                                          <C>                            <C>
    Changchun Zheng .........................                      --                                 --

    Yao Miao.................................                      --                                 --

    Hong Liang                                                     --                                 --

    Yu Xi Sun                                                      --                                 --

    Mei Jin Bin .............................                      --                                 --

    Xu Bao Dong .............................                      --                                 --

    Zu Zhuan Xu .............................                      --                                 --

    Alfred L. Simon .........................                 100,000(3)                               *

    Yong Yang

    All executive officers and directors ....                 100,000                                  *
    as a group (6 persons)

    5% Stockholders:

    Cheering Limited ........................               5,700,000(4)                               7.8%

    Yi Bo Sun                                              35,700,000(5)                              48.9%
</TABLE>

--------
*        Less than 1%

(1)      The address of the persons named in this column is Number 2222. Jin
         Tian Road. An Lian Building, 15th Floor A-01 and A-02, Eutian, Shezhen,
         China.

(2)      Shares of common stock subject to stock options and warrants that are
         currently exercisable or exercisable within 60 days or shares that
         otherwise may be acquired within 60 days of this Report are deemed to
         be beneficially owned by the person holding the options and warrants or
         person with the right to acquire such shares for computing such
         person's percentage, but are not treated as outstanding for computing
         the percentage of any other person.


                                       28
<PAGE>

(3)      Includes options to purchase 100,000 shares of our common stock.

(4)      Yi Bo Sun, our former Chairman and Chief Executive Officer, is also the
         Chairman and Chief Executive Officer of Cheering Limited. Cheering
         Limited beneficially owns 5,700,000 shares of our Common Stock. As the
         Chief Executive Officer and Chairman of the Board of Cheering Limited,
         Yi Bo Sun may be deemed to beneficially own shares owned by Cheering
         Limited.

(5)      In connection with the private placement we issued 30,000,000 shares of
         common stock, to the following investors:


         Xiong Xin Gan             7,200,000         9.87%
         Ruan Ju Xiang             6,000,000         8.22%
         Fan Xi                    5,400,000         7.40%
         Xu Zu Hong                4,500,000         6.17%
         Xu Zhu Zhuan              3,750,000         5.14%
         Fang Zao Jie              1,250,000         1.71%
         Wang Fu Xing              1,900,000         2.60%


         each of these investors executed an Irrevocable Proxy granting Yi Bo
         Sun, our former Chairman and Chief Executive Officer, the right to vote
         all shares of our common stock purchased by such investors in such
         placement. The Irrevocable Proxies expire May 1, 2006. As a result, Yi
         Bo Sun will be entitled to vote an aggregate of 35,700,000 shares (or
         approximately 48.9%) of our Common Stock until May 1, 2006.



         The following table sets forth certain information, as at December 31,
2005, with respect to the Company's equity compensation plans:

<TABLE>
<CAPTION>
                                                                                             NUMBER OF SECURITIES
                                   NUMBER OF SECURITIES TO BE       WEIGHTED-AVERAGE       REMAINING AVAILABLE FOR
                                    ISSUED UPON EXERCISE OF        EXERCISE PRICE OF           FUTURE ISSUANCE
                                 OUTSTANDING OPTIONS, WARRANTS    OUTSTANDING OPTIONS,    UNDER EQUITY COMPENSATION
         PLAN CATEGORY                     AND RIGHTS             WARRANTS AND RIGHTS               PLANS
         -------------                     ----------                     -----------               -----
<S>                                       <C>                         <C>                           <C>
Equity compensation plans
approved by security holders..                      --                      --                           --

Equity compensation plans not
approved by security holders..                 100,000(1)                $0.53                           --
                                 ------------------------------- ----------------------- -----------------------------
  Total.......................                      --                      --                           --
                                 =============================== ======================= =============================
</TABLE>


(1)      Represents options to purchase 100,000 shares of our comment stock
         granted to Albert Simon.


                                       29
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         During calendar years 2003 and 2004, we were parties to an agreement
with Jack Gregory, our former President, whereby Mr. Gregory allowed us to use
his office space rent-free until we were able to show significant revenue. This
agreement terminated upon the consummation of the purchase of 5,700,000 shares
of Common Stock by Cheering Limited.

ITEM 13.  EXHIBIT.

EXHIBIT
NUMBER                       DOCUMENT DESCRIPTION
--------------------------------------------------------------------------------
2.1      Share Exchange Agreement, dated as of February 14, 2006, among China
         Digital Communication Group, a Nevada corporation, UPE Limited (Far
         East), a BVI corporation, Shenzhen Zhuo Tong Power Supply Industry Co.,
         Ltd., a Shenzhen corporation and a wholly-owned subsidiary of UPE
         Limited, and the shareholders of UPE Limited (Exhibit 2.1 to Form 8-K
         filed with the Commission on February 21, 2006)

2.2      Amended and Restated Share Exchange Agreement dated as of March 22,
         2006, by and among China Digital Communication Group, Galaxy View
         International Ltd., Shenzhen Sono, and the shareholders of Galaxy View
         International Ltd. (Exhibit 2.1 to the Form 8-K filed March 24, 2006)

3.1      Articles of Incorporation (Exhibit 3(i)(1) to Form 8-K filed with the
         Commission on September 16, 2004)

3.2      Bylaws (Exhibit 3.4 to Registration Statement on Form SB-2/A, Amendment
         No. 8, filed with the Commission on March 22, 2002)

3.3      Certificate of Amendment to the Articles of Incorporation (Exhibit
         3(i)(2) to Form 8-K filed with the Commission on September 16, 2004)

3.4      Certificate of Amendment to the Articles of Incorporation (Exhibit
         3(i)(3) to Form 8-K filed with the Commission on September 16, 2004)

4.1      Form of Stock Certificate (Exhibit 4.1 to Registration Statement on
         Form SB-2/A, Amendment No. 8, filed with the Commission on March 22,
         2002)

4.2      2004 Equity Incentive Plan (Exhibit 4.1 to Registration Statement on
         Form S-8 filed with the Commission on March 2, 2004)

4.3      Form of Class A, B and C Warrants

10.1     Form of Subscription Agreement dated March 17, 2004 by and among
         Jasmine's Garden and the Investors (Exhibit 4.1 to Form 8-K filed with
         the Commission on March 22, 2004)

10.2     Share Exchange Agreement and Plan of Reorganization (Exhibit 10.1 to
         the Form 8-K filed September 29, 2004)

10.3     Sales Contract dated April 21, 2005 between Shenzhan E'Jenine Science &
         Technology Co., LTD. and Shenzhen Gao Yi Electonics Co. LTD. (Exhibit
         10.1 to Form 8-K filed with the Commission on April 22, 2005)

10.4     Sales Contract dated July 12, 2005 between Shenzhan E'Jenine Science &
         Technology Co., LTD. and Wuhan Jie Xin Communication Development Co.,
         LTD. (Exhibit 2.1 to Form 8-K filed with the Commission on July 14,
         2005

10.5     Sales Contract dated December 31, 2005 between Shenzhan E'Jenine
         Science & Technology Co., LTD. and Yin Si Qi Electronics Co. (Exhibit
         2.1 to Form 8-K field with the Commission on January 6, 2006)

10.6     Loan Agreement dated March 10, 2006, between China Digital
         Communication Group and United Private Equity (The Pacific) Limited.
         (Exhibit 2.1 to the Form 8-K filed March 15, 2006)


                                       30
<PAGE>

14.1*    Code of Ethics.

21.1*    List of Subsidiaries

23.1*    Consent of Lichter, Yu & Associates

23.2*    Consent of Kabani & Company, Inc.

31.1*    Certification of principal executive officer pursuant to Section 302 of
         the Sarbanes-Oxley Act of 2002 promulgated under the Securities
         Exchange Act of 1934.

31.2*    Certification of principal financial officer pursuant to Section 302 of
         the Sarbanes-Oxley Act of 2002 promulgated under the Securities
         Exchange Act of 1934.

32.1*    Certification of Principal Executive Officer pursuant to Section 906 of
         the Sarbanes-Oxley Act of 2002.

32.2*    Certification of Principal Financial Officer pursuant to Section 906 of
         the Sarbanes-Oxley Act of 2002.

 --------------------
 *        Filed with this Report. All other exhibits are incorporated herein by
          reference to the filing indicated in the parenthetical reference
          following the exhibit description.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Audit Fees:

2005:

         The aggregate fees billed by our auditors, Kabani & Company, Inc., for
professional services rendered for the audit of our annual financial statements
for the year ended December 31, 2005 were $32,000.

         The aggregate fees billed by our former auditors, Lichter, Yu &
Associates, for professional services rendered for the reviews of the financial
statements included in our Quarterly Reports on Form 10-QSB during fiscal year
2005 were $ 24,750.

2004:

         We incurred no audit fees to Kabani & Company for the year ended
December 31, 2004.

         The aggregate fees billed by Lichter, Yu & Associates, for professional
services rendered for the audit of our annual financial statements for the year
ended December 31, 2004, and for the reviews of the financial statements
included in our Quarterly Reports on Form 10-QSB during that fiscal year were
$40,000.

Audit Related Fees:


                                       31
<PAGE>

2005

         We incurred no audit related fees to Kabani & Company during the year
ended December 31, 2005

         We incurred no audit related fees to Lichter, Yu & Associates during
the year ended December 31, 2005

2004

         We incurred no audit related fees to Kabani & Company during the year
ended December 31, 2004.

         Lichter, Yu & Associates was paid additional fees of approximately
$2,500 for assurance and related services reasonably related to the performance
of the audit or review of our financial statements for the year ended December
31, 2004.

Tax Fees:

         We incurred no fees for professional services rendered by Kabani &
Company, Inc. or Lichter, Yu & Associates, for tax compliance, tax advice and
tax compliance services during the fiscal years ended December 31, 2005 and
2004.

Audit Committee Pre-approval Policies and Procedures

         Our Audit Committee's policy is to pre-approve all audit and
permissible non-audit services provided by our independent auditors. These
services may include audit services, audit-related services, tax services and
other services. Pre-approval is generally provided for up to one year and any
pre-approval is detailed as to the particular service or category of services.
The independent auditor and management are required to periodically report to
the Audit Committee regarding the extent of services provided by the independent
auditor in accordance with this pre-approval.



                                       32
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                        CHINA DIGITAL COMMUNICATION GROUP

                                        By: /s/ Changchun Zheng
                                            ------------------------------------
                                            Name:  Changchun Zheng
                                            Title: Chief Executive Officer

         Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
SIGNATURE                                TITLE                            DATE

<S>                                      <C>                              <C>
/s/ Changchun Zheng                      Chairman and Chief Executive     March 30, 2006
-------------------------------------    Officer
Changchun Zheng                          (Principal Executive Officer)



 /s/ Yao Miao                            Chief Financial Officer          March 30, 2006
-------------------------------------    (Principal Financial and
Yao Miao                                 Accounting Officer)
                                         President and Director

 /s/ Yuxi Sun                                                             March 30, 2006
-------------------------------------
Yuxi Sun

 /s/ Hong Liang                          Director                         March 30, 2006
-------------------------------------
Hong Liang

 /s/ Mei Jin Bin                         Director                         March 30, 2006
-------------------------------------
Mei Jin Bin

/s/ Xu Bao Dong                          Director                         March 30, 2006
-------------------------------------
Xu Bao Dong

/s/ Zu Zhuan Xu                          Director                         March 30, 2006
-------------------------------------
Zu Zhuan Xu

/s/ Alfred L. Simon                      Director                         March 30, 2006
-------------------------------------
Alfred L. Simon


                                       33
<PAGE>

/s/ Yong Yang                            Director                         March 30, 2006
-------------------------------------
Yong Yang
</TABLE>



                                       34
<PAGE>

               China Digital Communication Group and Subsidiaries
                       (formerly Jasmine's Garden, Inc.)
                       Consolidated Financial Statements
                               December 31, 2005



                                TABLE OF CONTENTS

Report of Independent Registered Public Accounting Firm                     F-1

Consolidated Balance Sheet                                                  F-2

Consolidated Statements of Income                                           F-3

Consolidated Statements of Cash Flow                                        F-4

Consolidated Statements of Changes in Stockholders' Equity                  F-5

Notes to Consolidated Financial Statements                                F-6-21


<PAGE>


            REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Stockholders of
China Digital Communication Group and Subsidiaries, Inc.

We have audited the  accompanying  consolidated  balance sheets of China Digital
Communication Group and Subsidiaries, Inc. (a Nevada corporation) as of December
31,  2005,  and the related  consolidated  statements  of income,  stockholders'
equity,  and cash flows for the year ended December 31, 2005. These consolidated
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall  consolidated  financial  statement  presentation.  We
believe that our audit provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the consolidated  financial position of China
Digital Communication Group and Subsidiaries,  Inc. as of December 31, 2005, and
the consolidated  results of their operations and their  consolidated cash flows
for the year ended December 31, 2005, in conformity with U.S. generally accepted
accounting principles.

/s/ Kabani & Company, Inc.
CERTIFIED PUBLIC ACCOUNTANTS

Los Angeles, California
March 10, 2006



<PAGE>


               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                           (FORMERLY JASMINE'S GARDEN)
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2005


<TABLE>
<CAPTION>
                                                 ASSETS
                                                 ------


CURRENT ASSETS
<S>                                                                         <C>
           Cash and cash equivalents                                        $2,061,213
           Accounts receivable, net                                          2,219,870
           Inventory                                                           343,705
           Prepaid expenses                                                    130,501
           Other receivables                                                    10,395
                                                                            ----------
                   Total Current Assets                                      4,765,684
                                                                            ----------

PROPERTY & EQUIPMENT, NET                                                      684,298
                                                                            ----------

OTHER ASSETS

           Deposits                                                              3,100
           Goodwill                                                          1,865,067
                                                                            ----------
                   Total Other Assets                                        1,868,167
                                                                            ----------

TOTAL ASSETS                                                                $7,318,149
                                                                            ==========

                                    LIABILITIES AND STOCKHOLDERS' EQUITY
                                    ------------------------------------


CURRENT LIABILITIES
           Accounts payable and accrued expenses                            $  903,467
           Income tax payable                                                  100,822
           Loan payable to related party                                       174,600
           Advances                                                             81,050
           Short term note payable                                             248,000
                                                                            ----------
           Total Current Liabilities                                         1,507,939
                                                                            ----------

STOCKHOLDERS' EQUITY


           Common stock, $.001 par value, 140,000,000
           shares authorized, 54,460,626 issued and outstanding                 54,461
           Additional paid in capital                                        2,913,114
           Statutory reserve                                                    94,327
           Other comprehensive income                                          111,684
           Retained earnings                                                 2,636,624
                                                                            ----------
           TOTAL STOCKHOLDERS' EQUITY                                        5,810,210
                                                                            ----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                  $7,318,149
                                                                            ==========
</TABLE>

The accompanying notes are an integral part of thse consolidated financial
statements

                                       F-2
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                           (FORMERLY JASMINE'S GARDEN)
                        CONSOLIDATED STATEMENTS OF INCOME
                 FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004


                                                       2005             2004
                                                  ------------     ------------

     Sales, net                                   $ 12,742,088     $  2,338,718

     Cost of sales                                   8,971,859        1,294,346
                                                  ------------     ------------
                 GROSS PROFIT                        3,770,230        1,044,372

     Selling expense                                   165,780           55,416
     General and administrative expenses               839,418          227,082
     Consulting fees                                         -          598,000
                                                  ------------     ------------
                 INCOME FROM OPERATIONS              2,765,031          163,874
                                                  ------------     ------------

     Other (Income) Expense

                 Interest income                        (3,877)              (6)
                 Miscellaneous expense                       -              145
                 Interest expense                       32,856            7,384
                                                  ------------     ------------
                 Total Other (Income) Expense           28,979            7,523
                                                  ------------     ------------

                 INCOME BEFORE INCOME TAXES          2,736,052          156,351

     Provision for income taxes                        111,773           44,500
                                                  ------------     ------------

     NET INCOME                                   $  2,624,279     $    111,851
                                                  ============     ============

     NET INCOME (LOSS) PER SHARE:

                 Basic & diluted                  $       0.05     $          -
                                                  ============     ============

     WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:

                 Basic & diluted                    54,460,626       39,172,889
                                                  ============     ============

Weighted average number of shares for dilutive securities has not been taken
since the effect of dilutive securities is anti-dilutive



The accompanying notes are an integral part of these consolidated financials

                                      F-3
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                           (FORMERLY JASMINE'S GARDEN)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004


<TABLE>
<CAPTION>
                                                                                2005            2004
                                                                            -----------     -----------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                         <C>             <C>
            Net Income                                                      $ 2,624,279     $   111,851
            Adjustments to reconcile net income to net cash
            provided by operating activities:
            Depreciation                                                         83,807          13,500
            Gain on disposal of marketable securities                                 -           8,791
            (Gain)/ loss on disposal of property & equipment                     18,575               -
            Issuance of stock options                                            17,500               -
            Issuance of shares for consultants                                        -         598,000
            Cash acquired in acquisition                                              -         130,852
            (Increase) / decrease in assets:

                Accounts receivables                                           (204,099)       (626,976)
               Inventory                                                       (111,030)        (73,155)
               Other receivables                                                  2,328         182,045
               Prepaid expense                                                 (127,979)         (1,071)
               Deposits                                                           5,454          (8,470)
               Increase / (decrease) in current liabilities:

               Accounts payable and accrued expenses                           (231,904)         21,492
               Income tax payable                                               (27,801)        126,986
               Deferred revenue                                                  43,795          35,724
                                                                            -----------     -----------
            Total Adjustments                                                  (531,353)        407,718
                                                                            -----------     -----------

            NET CASH PROVIDED BY OPERATIONS                                   2,092,926         519,569
                                                                            -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES

            Purchase of subsidiary                                                    -      (1,500,000)
            Proceeds from sale of property & equipment                            1,094               -
            Purchase of property & equipment                                   (536,937)       (103,665)
                                                                            -----------     -----------

            NET CASH USED IN INVESTING ACTIVITIES                              (535,843)     (1,603,665)
                                                                            -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES

            Payment on loan payable                                              (2,093)              -
            Issuance of common stock                                                  -       1,500,000
                                                                            -----------     -----------

            NET CASH PROVIDED BY FINANCING ACTIVITIES                            (2,093)      1,500,000
                                                                            -----------     -----------

            Effect of exchange rate changes on cash and cash equivalents         69,097               -

            NET INCREASE IN CASH AND CASH EQUIVALENTS                         1,624,087         415,905

            CASH AND CASH EQUIVALENTS, BEGINNING BALANCE                        437,126          21,221
                                                                            -----------     -----------

            CASH AND CASH EQUIVALENTS, ENDING BALANCE                       $ 2,061,213     $   437,126
                                                                            ===========     ===========

SUPPLEMENTAL DISCLOSURES:


            Cash paid during the year for:


                 Income tax payments                                        $    84,$                 -
                                                                            ===========     ===========

                 Interest payments                                          $    99,140     $     7,384
                                                                            ===========     ===========

            Non-cash investing and financing activities:


                 Issuance of stock for purchase of subsidiary               $         -     $   832,906
                                                                            ===========     ===========
</TABLE>



The accompanying notes are an integral part of these consolidated financials

                                      F-4
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                 FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004

<TABLE>
<CAPTION>

                                                                                                    OTHER
                                                           COMMON STOCK         ADDITIONAL PAID  COMPREHENSIVE
                                                      SHARES         AMOUNT       IN CAPITAL        INCOME
                                                    ----------    -----------    -----------      ---------
<S>                                                  <C>          <C>            <C>              <C>
 Balance January 1, 2004                             6,015,400    $     6,015    $    15,385      $       -

Issuance of stock                                   48,445,226         48,446      2,880,229              -

Net loss for the year ended December 31, 2004                -              -              -              -
                                                    ----------    -----------    -----------      ---------
 Balance December 31, 2004                          54,460,626         54,461      2,895,614              -

Issuance of stock options                                    -              -         17,500              -

Change in foreign currency translation gain                  -              -              -        111,684

Transfer to statutory reserve                                -              -              -              -

Net income for the year ended December 31, 2005              -              -              -              -
                                                    ----------    -----------    -----------      ---------
 BALANCE DECEMBER 31, 2005                          54,460,626    $    54,461    $ 2,913,114      $ 111,684
                                                    ----------    -----------    -----------      ---------
<CAPTION>
                                                                  RETAINED
                                                                  EARNINGS          TOTAL
                                                    STATUTORY   (ACCUMULATED    STOCKHOLDERS'
                                                     RESERVE      DEFICIT)         EQUITY
                                                    --------     ----------     -----------
<S>                                                 <C>         <C>             <C>
 Balance January 1, 2004                            $      -    $    (5,179)    $    16,221

Issuance of stock                                          -              -       2,928,675

Net loss for the year ended December 31, 2004              -        111,851         111,851
                                                    --------     ----------     -----------
 Balance December 31, 2004                                          106,672      3,056,747

Issuance of stock options                                  -              -          17,500

Change in foreign currency translation gain                -              -         111,684

Transfer to statutory reserve                         94,327        (94,327)              -

Net income for the year ended December 31, 2005            -      2,624,279       2,624,279
                                                    --------     ----------     -----------
 BALANCE DECEMBER 31, 2005                          $ 94,327    $ 2,636,624     $ 5,810,210
                                                    --------     ----------     -----------
</TABLE>


                                      F-5

<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE A - ORGANIZATION

         China Digital Communication Group, formerly Jasmine's Garden, Inc. (the
         "Company")  was  incorporated  under the laws of the State of Nevada on
         March 27, 2001.  On September  30,  2004,  the Company  entered into an
         Exchange  Agreement  with  Billion.  Billion owns all of the issued and
         outstanding shares of Shenzhen E'Jenie Science and Technology  Company,
         Limited  (E'Jenie).   Billion   Electronics  Co.,  Ltd.  (Billion)  was
         incorporated  under the laws of the British  Virgin Islands on July 27,
         2004. Shenzhen E'Jenie Science & Technology Company Limited was legally
         established on July 8, 2002 under the laws of the Peoples'  Republic of
         China.  When used in these notes,  the terms "Company," "we," "our," or
         "us" mean China Digital Communication Group and its Subsidiaries.

         On September 30, 2004, the Company  entered into an Exchange  Agreement
         with Billion. Pursuant to the Exchange Agreement, the Company agreed to
         purchase  all of the  issued  and  outstanding  shares of  Billion  for
         approximately  $1,500,000 in cash and 4,566,210 shares of the Company's
         common stock, or approximately 8.7% of the total issued and outstanding
         shares.

         The Company through its acquisition of Billion and E'Jenie is no longer
         considered a development  stage company as it was during the year ended
         December  31,  2003.  The Company is now engaged in the business of the
         research and  development,  manufacture,  and  distribution  of battery
         casings.

         Basis of Presentation

         The accompanying  consolidated  financial statements have been prepared
         in conformity  with  accounting  principles  generally  accepted in the
         United  States of America.  The  Company's  functional  currency is the
         Chinese  Renminbi;  however  the  accompanying  consolidated  financial
         statements  have been translated and presented in United States Dollars
         ($).

         Exchange Gain (Loss):

         During the year ended December 31, 2005 and 2004, the  transactions  of
         E'Jenie  were  denominated  in foreign  currency  and were  recorded in
         Chinese Yuan Renminbi (CNY) at the rates of exchange in effect when the
         transactions  occur.  Exchange  gains and losses are recognized for the
         different  foreign  exchange  rates  applied when the foreign  currency
         assets and liabilities are settled.

         Translation Adjustment

         As of  December  31,  2005 and  2004,  the  accounts  of  E'Jenie  were
         maintained,  and its financial  statements were  expressed,  in Chinese
         Yuan Renminbi  (CNY).  Such financial  statements  were translated into
         U.S.  Dollars (USD) in accordance with Statement of Financial  Accounts
         Standards ("SFAS") No. 52, "Foreign Currency Translation," with the CNY
         as the functional currency.  According to the Statement, all assets and
         liabilities were translated at the current exchange rate, stockholder's
         equity are  translated  at the  historical  rates and income  statement
         items are translated at the average  exchange rate for the period.  The
         resulting   translation    adjustments   are   reported   under   other
         comprehensive  income  in  accordance  with  SFAS No.  130,  "Reporting
         Comprehensive Income" as a component of shareholders' equity.


                                      F-6
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Use of Estimates

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities and disclosure of contingent  assets and liabilities at the
         date of the financial  statements and the reported  amounts of revenues
         and expenses during the reporting  period.  Actual results could differ
         from those estimates.

         Principles of Consolidation

         The  consolidated  financial  statements  include the accounts of China
         Digital  Communication Group and its wholly owned subsidiaries  Billion
         and  E'Jenie,  collectively  referred  to  within as the  Company.  All
         material  intercompany  accounts,  transactions  and profits  have been
         eliminated in consolidation.

         Risks and Uncertainties

         The Company is subject to substantial  risks from,  among other things,
         intense  competition  associated  with the  industry in general,  other
         risks  associated  with  financing,  liquidity  requirements,   rapidly
         changing  customer  requirements,  limited operating  history,  foreign
         currency exchange rates and the volatility of public markets.


                                      F-7
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Contingencies

         Certain  conditions  may exist as of the date the financial  statements
         are  issued,  which may result in a loss to the  Company but which will
         only be resolved when one or more future events occur or fail to occur.
         The  Company's  management  and legal  counsel  assess such  contingent
         liabilities,  and such  assessment  inherently  involves an exercise of
         judgment.  In assessing loss contingencies related to legal proceedings
         that are  pending  against the  Company or  unasserted  claims that may
         result in such  proceedings,  the Company's legal counsel evaluates the
         perceived merits of any legal  proceedings or unasserted claims as well
         as the  perceived  merits of the amount of relief sought or expected to
         be sought.

         If the assessment of a contingency indicates that it is probable that a
         material  loss has been incurred and the amount of the liability can be
         estimated,  then  the  estimated  liability  would  be  accrued  in the
         Company's  financial  statements.  If the  assessment  indicates that a
         potential  material loss  contingency is not probable but is reasonably
         possible,  or is probable but cannot be  estimated,  then the nature of
         the  contingent  liability,  together  with an estimate of the range of
         possible loss if determinable and material would be disclosed.

         Loss contingencies  considered to be remote by management are generally
         not  disclosed  unless  they  involve  guarantees,  in  which  case the
         guarantee would be disclosed.

         Use of Estimates

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles in the United States ("GAAP") requires
         management to make certain  estimates and  assumptions  that affect the
         reported amounts of assets and liabilities and disclosure of contingent
         assets and liabilities at the date of the financial  statements and the
         reported amounts of revenues and expenses during the reporting  period.
         Actual results could differ from those estimates. Significant estimates
         include collectibility of accounts receivable,  accounts payable, sales
         returns and recoverability of long-term assets.

         Cash and Cash Equivalents

         Cash  and  cash  equivalents  include  cash  in hand  and  cash in time
         deposits,   certificates   of  deposit  and  all  highly   liquid  debt
         instruments with original maturities of three months or less.

         Accounts Receivable

         The Company maintains  reserves for potential credit losses on accounts
         receivable.  Management reviews the composition of accounts  receivable
         and analyzes historical bad debts,  customer  concentrations,  customer
         credit  worthiness,  current  economic  trends and  changes in customer
         payment  patterns to evaluate the adequacy of these reserves.  Terms of
         the  sales  vary.   Reserves  are  recorded  primarily  on  a  specific
         identification basis. Allowance for doubtful debts amounted to $135,892
         as at December 31, 2005.



                                      F-8
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Inventories

         Inventories  are valued at the lower of cost  (determined on a weighted
         average  basis)  or  market.  The  Management   compares  the  cost  of
         inventories  with the market  value and  allowance  is made for writing
         down their  inventories to market value,  if lower.  As of December 31,
         2005 inventory consisted of raw material, work in progress and finished
         goods as follows:

         INVENTORY
         Raw Material                             $ 104,206
         Work-in-process                             74,182
         Finished goods                             165,317
                                                  ---------
                                                  $ 343,705
                                                  =========


         Property, Plant & Equipment

         Property and equipment are stated at cost. Expenditures for maintenance
         and repairs are charged to earnings as  incurred;  additions,  renewals
         and  betterments  are  capitalized.  When  property and  equipment  are
         retired or  otherwise  disposed  of, the related  cost and  accumulated
         depreciation are removed from the respective accounts,  and any gain or
         loss is included in operations.  Depreciation of property and equipment
         is provided using the straight-line method for substantially all assets
         with estimated lives of:

               Furniture and Fixtures                5 years
               Equipment                             5 years
               Computer Hardware and Software        5 years

         As of December 31, 2005 Property, Plant & Equipment consist of the
         following:

                    Machinery                         $ 745,419
                    Automobile                            9,531
                    Leasehold improvements               24,510
                    Office equipment                      2,957
                                                      ----------

                                                        782,418

                    Accumulated depreciation            (98,120)
                                                      ----------
                                                      $ 684,298
                                                      ==========


                                      F-9
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Long-Lived Assets

         Effective  January 1, 2002, the Company adopted  Statement of Financial
         Accounting  Standards  No.  144,  "Accounting  for  the  Impairment  or
         Disposal of Long-Lived Assets" ("SFAS 144"), which addresses  financial
         accounting  and reporting for the  impairment or disposal of long-lived
         assets and supersedes  SFAS No. 121,  "Accounting for the Impairment of
         Long-Lived Assets and for Long-Lived Assets to be Disposed Of," and the
         accounting and reporting  provisions of APB Opinion No. 30,  "Reporting
         the Results of  Operations  for a Disposal of a Segment of a Business."
         The Company  periodically  evaluates  the carrying  value of long-lived
         assets  to be held and  used in  accordance  with  SFAS  144.  SFAS 144
         requires  impairment losses to be recorded on long-lived assets used in
         operations   when   indicators  of  impairment   are  present  and  the
         undiscounted  cash flows  estimated to be generated by those assets are
         less  than the  assets'  carrying  amounts.  In that  event,  a loss is
         recognized based on the amount by which the carrying amount exceeds the
         fair market value of the long-lived  assets.  Loss on long-lived assets
         to be disposed of is determined in a similar  manner,  except that fair
         market  values  are  reduced  for the  cost of  disposal.  Based on its
         review,  the Company  believes that, as of December 31, 2005 there were
         no significant impairments of its long-lived assets.

         Fair Value of Financial Instruments

         Statement of financial  accounting standard No. 107,  Disclosures about
         fair value of financial instruments, requires that the Company disclose
         estimated fair values of financial  instruments.  The carrying  amounts
         reported in the statements of financial position for current assets and
         current   liabilities   qualifying  as  financial   instruments  are  a
         reasonable estimate of fair value.

         Revenue Recognition

         The Company's revenue recognition policies are in compliance with Staff
         accounting  bulletin (SAB) 104. Sales revenue is recognized at the date
         of shipment to customers when a formal arrangement exists, the price is
         fixed or determinable,  the delivery is completed, no other significant
         obligations  of the  Company  exist and  collectibility  is  reasonably
         assured.  Payments  received  before all of the  relevant  criteria for
         revenue recognition are satisfied are recorded as unearned revenue.

         Stock-Based Compensation

         In  October  1995,  the FASB  issued  SFAS  No.  123,  "Accounting  for
         Stock-Based  Compensation".  SFAS No.  123  prescribes  accounting  and
         reporting standards for all stock-based  compensation plans,  including
         employee stock options, restricted stock, employee stock purchase plans
         and stock  appreciation  rights.  SFAS No.  123  requires  compensation
         expense  to be  recorded  (i) using the new fair  value  method or (ii)
         using the existing accounting rules prescribed by Accounting Principles
         Board Opinion No. 25,  "Accounting  for stock issued to employees" (APB
         25) and related  interpretations  with proforma  disclosure of what net
         income and earnings  per share would have been had the Company  adopted
         the new fair value method.  The Company uses the intrinsic value method
         prescribed  by APB 25 and has opted for the  disclosure  provisions  of
         SFAS No.123.


                                      F-10
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Advertising

         Advertising  expenses  consist  primarily  of  costs of  promotion  for
         corporate image and product marketing and costs of direct  advertising.
         The Company expenses all advertising costs as incurred.

         Income Taxes

         The Company utilizes SFAS No. 109, "Accounting for Income Taxes," which
         requires the recognition of deferred tax assets and liabilities for the
         expected  future tax  consequences of events that have been included in
         the financial  statements or tax returns.  Under this method,  deferred
         income taxes are recognized for the tax consequences in future years of
         differences  between the tax bases of assets and  liabilities and their
         financial  reporting  amounts at each  period end based on enacted  tax
         laws and  statutory  tax rates  applicable  to the periods in which the
         differences are expected to affect taxable income. Valuation allowances
         are established,  when necessary,  to reduce deferred tax assets to the
         amount expected to be realized.

         Basic and Diluted Earnings Per Share

         Earnings per share is calculated  in  accordance  with the Statement of
         financial  accounting  standards No. 128 (SFAS No. 128),  "Earnings per
         share".  SFAS No. 128 superseded  Accounting  Principles  Board Opinion
         No.15 (APB 15). Net loss per share for all periods  presented  has been
         restated  to reflect the  adoption of SFAS No. 128.  Basic net loss per
         share is based  upon the  weighted  average  number  of  common  shares
         outstanding. Diluted net loss per share is based on the assumption that
         all dilutive  convertible  shares and stock  options were  converted or
         exercised.  Dilution is computed by applying the treasury stock method.
         Under this method,  options and warrants are assumed to be exercised at
         the beginning of the period (or at the time of issuance, if later), and
         as if funds obtained  thereby were used to purchase common stock at the
         average market price during the period.

         Statement of Cash Flows

         In accordance  with SFAS No. 95,  "Statement of Cash Flows," cash flows
         from the Company's operations is based upon the local currencies.  As a
         result,  amounts  related to assets  and  liabilities  reported  on the
         statement of cash flows will not necessarily  agree with changes in the
         corresponding balances on the balance sheet.

         Concentration of Credit Risk

         Financial   instruments  that   potentially   subject  the  Company  to
         concentrations of credit risk are cash,  accounts  receivable and other
         receivables  arising from its normal business  activities.  The Company
         places  its  cash in what it  believes  to be  credit-worthy  financial
         institutions.  The Company has a  diversified  customer  base,  most of
         which are in  China.  The  Company  controls  credit  risk  related  to
         accounts  receivable  through  credit  approvals,   credit  limits  and
         monitoring  procedures.  The Company  routinely  assesses the financial
         strength of its  customers  and,  based upon  factors  surrounding  the
         credit risk,  establishes an allowance,  if required, for uncollectible
         accounts and, as a consequence,  believes that its accounts  receivable
         credit risk exposure beyond such allowance is limited.


                                      F-11
<PAGE>


               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Goodwill and intangible assets

         Goodwill  represents  the  excess of the  purchase  price over the fair
         value of the identifiable  assets and liabilities  acquired as a result
         of the Company's  acquisitions of interests in its subsidiaries.  Under
         Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill
         and  Other  Intangible  Assets  ("SFAS  142"),"  goodwill  is no longer
         amortized,  but tested for impairment upon first adoption and annually,
         thereafter,  or more  frequently if events or changes in  circumstances
         indicate that it might be impaired.  The Company assesses  goodwill for
         impairment periodically in accordance with SFAS 142.

         The Company applies the criteria  specified in SFAS No. 141,  "Business
         Combinations"  to  determine  whether  an  intangible  asset  should be
         recognized separately from goodwill. Intangible assets acquired through
         business  acquisitions  are recognized as assets separate from goodwill
         if  they  satisfy  either  the  "contractual-legal"  or  "separability"
         criterion.  Per SFAS 142,  intangible  assets with  definite  lives are
         amortized over their estimated  useful life and reviewed for impairment
         in  accordance  with SFAS No. 144,  "Accounting  for the  Impairment or
         Disposal of Long-lived  Assets."  Intangible assets,  such as purchased
         technology,   trademark,  customer  list,  user  base  and  non-compete
         agreements,  arising from the acquisitions of subsidiaries and variable
         interest  entities  are  recognized  and  measured  at fair  value upon
         acquisition.  Intangible  assets are  amortized  over  their  estimated
         useful  lives  from  one  to  ten  years.   The  Company   reviews  the
         amortization methods and estimated useful lives of intangible assets at
         least annually or when events or changes in circumstances indicate that
         it might be impaired.  The  recoverability of an intangible asset to be
         held and used is  evaluated by  comparing  the  carrying  amount of the
         intangible  asset to its future net  undiscounted  cash  flows.  If the
         intangible  asset is considered to be impaired,  the impairment loss is
         measured as the amount by which the carrying  amount of the  intangible
         asset exceeds the fair value of the intangible asset,  calculated using
         a discounted future cash flow analysis.  The Company uses estimates and
         judgments  in its  impairment  tests,  and if  different  estimates  or
         judgments had been utilized, the timing or the amount of the impairment
         charges could be different.

          The Company  performed an impairment test relating to goodwill arising
         from its  acquisitions and concluded that there was no impairment as to
         the carrying value of goodwill as of December 31, 2005.

         Segment Reporting

         Statement  of  Financial  Accounting  Standards  No. 131 ("SFAS  131"),
         "Disclosure  About Segments of an Enterprise  and Related  Information"
         requires use of the "management  approach" model for segment reporting.
         The  management  approach  model  is  based  on  the  way  a  company's
         management  organizes  segments within the company for making operating
         decisions and assessing  performance.  Reportable segments are based on
         products  and  services,   geography,   legal   structure,   management
         structure,  or any other  manner in which  management  disaggregates  a
         company. SFAS 131 has no effect on the Company's consolidated financial
         statements as the Company consists of one reportable business segment.


                                      F-12
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Recent accounting pronouncements

         In May 2005,  the FASB  issued SFAS No.  154,  "Accounting  Changes and
         Error  Corrections." This statement applies to all voluntary changes in
         accounting  principle and requires  retrospective  application to prior
         periods'  financial  statements  of  changes in  accounting  principle,
         unless  this  would  be  impracticable.  This  statement  also  makes a
         distinction  between  "retrospective   application"  of  an  accounting
         principle and the "restatement" of financial  statements to reflect the
         correction  of an error.  This  statement is effective  for  accounting
         changes and  corrections of errors made in fiscal years beginning after
         December 15, 2005.

         In February  2006,  FASB issued SFAS No. 155,  "Accounting  for Certain
         Hybrid  Financial  Instruments".  SFAS  No.  155  amends  SFAS  No 133,
         "Accounting  for Derivative  Instruments and Hedging  Activities",  and
         SFAF No. 140,  "Accounting  for  Transfers  and  Servicing of Financial
         Assets and Extinguishments of Liabilities".  SFAS No. 155, permits fair
         value  remeasurement for any hybrid financial  instrument that contains
         an  embedded  derivative  that  otherwise  would  require  bifurcation,
         clarifies which interest-only strips and principal-only  strips are not
         subject to the requirements of SFAS No. 133,  establishes a requirement
         to  evaluate  interest  in  securitized  financial  assets to  identify
         interests  that  are  freestanding   derivatives  or  that  are  hybrid
         financial  instruments  that contain an embedded  derivative  requiring
         bifurcation,  clarifies that  concentrations of credit risk in the form
         of subordination are not embedded derivatives,  and amends SFAS No. 140
         to eliminate the prohibition on the qualifying  special-purpose  entity
         from  holding a  derivative  financial  instrument  that  pertains to a
         beneficial interest other than another derivative financial instrument.
         This statement is effective for all financial  instruments  acquired or
         issued  after the  beginning  of the  Company's  first fiscal year that
         begins after September 15, 2006.

         In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based
         Payment,  an Amendment of FASB Statement No. 123" ("FAS No. 123R"). FAS
         No. 123R requires companies to recognize in the statement of operations
         the grant-  date fair  value of stock  options  and other  equity-based
         compensation  issued to employees.  FAS No. 123R is effective beginning
         in the Company's first quarter of fiscal 2006.

         In June 2005, the EITF reached consensus on Issue No. 05-6, Determining
         the Amortization Period for Leasehold  Improvements ("EITF 05-6.") EITF
         05-6  provides  guidance on  determining  the  amortization  period for
         leasehold  improvements  acquired in a business combination or acquired
         subsequent  to lease  inception.  The  guidance  in EITF  05-6  will be
         applied prospectively and is effective for periods beginning after June
         29, 2005.  EITF 05-6 is not  expected to have a material  effect on its
         consolidated financial position or results of operations.

         The Company  believes that the adoption of these standards will have no
         material impact on its financial statements.

         Reclassifications

         Certain prior period amounts have been  reclassified  to conform to the
         year ended December 31, 2005 presentation.


                                      F-13
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE C - DEBT

         At December 31, 2005,  the Company had  borrowings  outstanding  in the
         aggregate amount of $248,000. Payable as follows:


                          DESCRIPTION
--------------------------------------------------------
Secured note payabel to a bank in                              $ 248,000
China, interest at the rate of 5.58% per annum,
due on July 30, 2006

                                                        -----------------
Total                                                          $ 248,000
                                                        =================




NOTE D- RELATED PARTY LOAN

         As of  December  31,  2005 and 2004,  the  company  had a  non-interest
         bearing  loan  payable to a  shareholder  of the company  amounting  to
         $174,600.

NOTE E- ADVANCES

         As of December 31, 2005, advances comprise of the following:


                          DESCRIPTION
-------------------------------------------------------
Advances from employees                                        $ 44,530

Advances from customers                                          36,520

                                                       -----------------
Total                                                          $ 81,050
                                                       =================


                                      F-14
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE F - COMMON STOCK

         On March 1, 2004, the Company  announced a plan named "Jasmine's Garden
         2004 Equity  Incentive  Plan"  ("Plan")  for  providing  incentives  to
         attract,  retain and  motivate  eligible  persons  whose  presence  and
         potential  contributions  are  important to the success of the Company.
         12,000,000 shares of common stock were allocated to the plan.

         On March 4,  2004,  certain  of the  Company's  principal  stockholders
         holding  9,442,700 shares of common stock,  representing  approximately
         52.53% of the then total issued and outstanding common stock,  approved
         by  written  consent  to  adopt a  resolution  to amend  the  Company's
         Articles of  Incorporation  to increase  the number of shares of common
         stock  authorized to be issued from  50,000,000 to  140,000,000  and to
         establish a class of preferred stock  consisting of 60,000,000  shares,
         par value $0.001 per share. The amendment was filed on April 28, 2004.

         On March 9, 2004, the Company issued  11,960,000  shares under the Plan
         to a number of consultants who were engaged to provide various services
         to the Company during the period from January 1, 2004 to March 31, 2004
         in relation to the  Company's  proposed plan to identify and complete a
         merger or acquisition with private  entities.  These shares were valued
         at $0.05 per share or $598,000 and were expensed as consulting  fees in
         the statements of operations.

         On March  17,  2004,  the  Company  completed  a  private  offering  of
         30,000,000  shares of its common stock at a per share price of $0.05 to
         seven  unaffiliated  individuals,  resulting  in gross  proceeds to the
         Company of  $1,500,000.  The proceeds were to be used for the Company's
         proposed  plan to identify  and complete a merger or  acquisition  with
         private entities.

         On September 30, 2004, the Company agreed to purchase all of the issued
         and   outstanding   shares  of  Billion  from  its   shareholders   for
         approximately  $1,500,000 in cash and 4,566,210 shares of the Company's
         common stock, or approximately 8.7% of the total issued and outstanding
         shares.

         On  September  30, 2004,  the Company  issued  1,919,016  shares of the
         Company's  common stock to a company for guarantee  fees related to the
         acquisition of Billion. The guarantee was valued at $604,595.

NOTE G - STOCK OPTION

         On November 4, 2005, the Company issued a nonqualified stock option for
         100,000 shares to a member of the board with an exercise price of $0.53
         that will expire on November 3, 2010.  The option shall vest and become
         exercisable immediately.

         The Company's 2005 Stock Option  Incentive  Plan (the "Plan")  provides
         for the grant of 100,000 option rights to a non-employee  director. The
         Plan  is   administered   by  the  Company's   Compensation   Committee
         ("Compensation    Committee").    The   Compensation    Committee,   as
         administrator   of  the  plan,   has  the   authority  to  select  plan
         participants and determine the terms and conditions of such awards.


                                      F-15
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE G - STOCK OPTION (CONTINUED)

         The Company  adopted SFAS 123(R) on November 1, 2005 using the modified
         prospective  method.  Prior to the  adoption of SFAS 123(R) the Company
         did not have any stock options. The Company recorded expenses for stock
         based  compensation  of $17,500 and $0 for the years ended December 31,
         2005 and 2004,  respectively.  The Company also  recognized  income tax
         benefits  related to the stock based  compensation of $6,000 and $0 for
         the years ended December 31, 2005 and 2004, respectively.

         Stock options -- The Stock options have a five-year life and were fully
         vested  upon  issuance.  The option  holder  has no voting or  dividend
         rights.  The grant price was in excess of the market  price at the date
         of grant. The Company records the expense of the stock options over the
         related vesting period. The options were valued using the Black-Scholes
         option-pricing  model  at  the  date  of  grant  stock  option  pricing
         assumptions.

                                                       Year ended December 31,
                                                       -----------------------
                                                        2005             2004
                                                        ----             ----
Expected volatility                                     58.0%            N/A
Expected term (in years)                                  5.0            N/A
Expected dividends                                         --             --
Risk-free rate of return (weighted average)              4.0%            N/A
Weighted average grant-date fair value                  $0.53            N/A

         Expected  volatility  is  based  on the  historical  volatility  of the
         Company's  stock price.  The expected  term  represents  the  estimated
         average period of time that the options remain outstanding. No dividend
         payouts were assumed,  as the Company has no plans to declare dividends
         during the expected term of the stock  options.  The risk-free  rate of
         return  reflects the weighted  average  interest  rate offered for zero
         coupon treasury bonds over the expected term of the options.

         A summary of the stock option  activity for the year ended December 31,
2005 is presented below:

<TABLE>
<CAPTION>
                             Number                              Weighted-Average      Aggregate
                             of            Weighted-Average    Remaining Contractual   Intrinsic
                             Options        Exercise Price         Term (years)          Value
<C>                           <C>                <C>                      <C>          <C>
Outstanding at January 1,
2005                                -                -
Granted                       100,000            $0.53
Exercised                           -                -
Forfeited                           -                -
                              -------            -----                    ----         -------
Outstanding at December 31,
2005                          100,000            $0.53                    4.75         $17,500
Exercisable at December 31,
2005                                -                -                       -               -
                              -------            -----                    ----         -------
</TABLE>

         As of December 31, 2005, there was $17,500 of compensation cost related
         to the outstanding  stock options.  The total fair value of the options
         vested during the year ended December 31, 2005 was $17,500.

                                      F-16
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE H -   EXCHANGE AGREEMENT

         On September 30, 2004, the Company  entered into an Exchange  Agreement
         with Billion  Electronics Co., Ltd. (Billion),  a company  incorporated
         under the laws of the British Virgin  Islands.  Billion owns all of the
         issued  and  outstanding   shares  of  Shenzhen   E'Jenie  Science  and
         Technology Company,  Ltd. E'Jenie is incorporated under the laws of the
         Peoples  Republic  of China,  and is  engaged  in the  business  of the
         research and  development,  manufacture,  and  distribution  of battery
         casings.

         Pursuant to the Exchange Agreement,  the Company agreed to purchase all
         of the issued and outstanding  shares of Billion from the  shareholders
         for  approximately  $1,500,000  in cash  and  4,566,210  shares  of the
         Company's common stock, or  approximately  8.7% of the total issued and
         outstanding shares. This transaction closed on November 15, 2004.

NOTE I -   STOCK PURCHASE BUSINESS COMBINATION

         On November  15, 2004 the Company  completed  the  purchase of Billion,
         which owns all of the  issued and  outstanding  shares of  E'Jenie.  By
         acquiring all of the  outstanding  capital stock of Billion and E'Jenie
         in exchange for $1,500,000 and 4,566,210 shares of the Company's common
         stock.  The  acquisition was accounted for using the purchase method of
         accounting  and,  accordingly,   Billion's  and  E'Jenie's  results  of
         operations have been included in the consolidated  financial statements
         since the date of acquisition.

         The following  table presents the allocation of the  acquisition  cost,
         including professional fees and other related acquisition costs, to the
         assets acquired and liabilities assumed:


Cash and cash equivalents                $             130,852
Accounts receivable                                  1,337,093
Other receivable                                       194,494
Inventories                                            152,295
Property, plant, and equipment                         184,711
                                             ------------------
Total assets                                         1,999,445
                                             ------------------

Accounts payable                                      $552,572
Loan payable                                           241,345
Other current liabilities                              737,689
                                             ------------------
Total liabilities                                    1,531,606
                                             ------------------
Total acquisition cost                   $             467,839
                                             ==================

Cost
Total cost of investment                 $           2,332,906
Total Acquisition cost                                 467,839
                                             ------------------
Goodwill                                 $           1,865,067
                                             ==================


                                      F-17
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE I -   STOCK PURCHASE BUSINESS COMBINATION (CONTINUED)

         The following  (unaudited) pro forma consolidated results of operations
         have been  prepared as if the  acquisition  of Billion had  occurred at
         January 1, 2004:

                                                       December 31, 2004
                                                       -----------------
         Sales                                               $5,181,694
          Net income (loss)                                     427,930
          Net income per share--basic                              .011
          Net income per share--diluted                            .011

         The pro forma information is presented for informational  purposes only
         and is not  necessarily  indicative of the results of  operations  that
         actually would have been achieved had the acquisitions been consummated
         as of that  time,  nor is it  intended  to be a  projection  of  future
         results.

NOTE J - COMPENSATED ABSENCES

         Employees earn annual  vacation leave at the rate of seven (7) days per
         year for the first three years.  Upon  completion  of the third year of
         employment,  employees  earn annual  vacation  leave at the rate of ten
         (10) days per year for years four through five.  Upon completion of the
         fifth year of employment,  employees earn annual  vacation leave at the
         rate of fourteen (14) days per year for years six (6) through ten (10).
         Upon completion of the tenth year of employment, one (1) additional day
         for each additional  year,  until it reaches thirty (30) days per year.
         At termination,  employees are paid for any accumulated annual vacation
         leave.  As of  December  31,  2005 no  accumulated  vacation  liability
         exists.

NOTE K - INCOME TAXES

         The Company through its subsidiary,  E'Jenie, is governed by the Income
         Tax Laws of the PRC.  Operations  in the United  States of America have
         incurred net accumulated operating losses for income tax purposes.  The
         Company  believes  that it is more  likely  than  not  that  these  net
         accumulated  operating  losses  will not be  utilized in the future and
         hence the Company has not recorded  any deferred  assets as of December
         31, 2005.

         Pursuant to the PRC Income Tax Laws, the Enterprise  Income Tax ("EIT")
         is at a  statutory  rate of 33%,  which is  comprises  of 30%  national
         income  tax  and  3%  local  income  tax.  E'Jenie  qualified  as a new
         technology  enterprise and under PRC Income Tax Laws,  they are subject
         to a preferential tax rate of 15%.


                                      F-18
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005


NOTE K - INCOME TAXES (CONTINUED)

The following is a reconciliation of income tax expense:

<TABLE>
<CAPTION>
12/31/2005                                       U.S.             State       International       Total
                                            ---------------    ---------------------------------------------
<S>                                                     <C>            <C>            <C>          <C>
Current                                                 $0             $800           $110,973     $111,773
Deferred                                                 -                -                  -            -
                                            ---------------    ---------------------------------------------
     Total                                              $0             $800           $110,973     $111,773
                                            ===============    =============================================

12/31/2004                                       U.S.             State       International       Total
                                            ---------------    ---------------------------------------------
Current                                            $44,500               $0                 $0      $44,500
Deferred                                                 -                -                  -            -
                                            ---------------    ---------------------------------------------
     Total                                         $44,500               $0                 $0      $44,500
                                            ===============    =============================================
</TABLE>

Reconciliation of the differences  between the statutory U.S. Federal income tax
rate and the effective rate is as follows:


                                              12/31/2005        12/31/2004
                                            ---------------    -------------

US statutory tax rate                                  34%              34%
Foreign income not recognized in US                   -34%             -34%
PRC income tax                                         15%              15%
                                            ---------------    -------------

Effective rate                                         15%              15%


NOTE L - COMMITTMENTS

         The Company leases various office  facilities  under  operating  leases
         that  terminate  on various  dates.  Rental  expense  for these  leases
         consisted of $73,386 for the year ended  December 31, 2005. The Company
         has future minimum lease obligations as follows:


2006                        $        72,594

Total                       $        72,594
                            ===============

                                      F-19
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

NOTE M - STATUTORY COMMON WELFARE FUND

     As stipulated  by the Company Law of the People's  Republic of China (PRC),
     net income  after  taxation  can only be  distributed  as  dividends  after
     appropriation has been made for the following:

i.            Making up cumulative prior years' losses, if any;

ii.           Allocations to the "Statutory  surplus reserve" of at least 10% of
              income after tax, as  determined  under PRC  accounting  rules and
              regulations,  until  the  fund  amounts  to 50%  of the  Company's
              registered capital;

iii.          Allocations of 5-10% of income after tax, as determined  under PRC
              accounting  rules and  regulations,  to the  Company's  "Statutory
              common  welfare  fund",  which is  established  for the purpose of
              providing employee facilities and other collective benefits to the
              Company's employees; and

iv.           Allocations to the discretionary  surplus reserve,  if approved in
              the stockholders' general meeting.

         The Company  established a reserve for the annual contribution of 5% of
         net income to the  welfare  fund in 2005.  The amount  included  in the
         statutory  reserve for the year ended  December  31,  2005  amounted to
         $31,442.


NOTE N - STATUTORY RESERVE

         In accordance  with the Chinese  Company Law, the company has allocated
         10% of its annual net income,  amounting  $62,885 as statutory  reserve
         for the year ended December 31, 2005.

NOTE O - OTHER COMPREHENSIVE INCOME

         Balances of related after-tax components  comprising  accumulated other
         comprehensive  income  (loss),  included in  stockholders'  equity,  at
         December 31, 2005 and December 31, 2004 are as follows:


<TABLE>
<CAPTION>
                                        Foreign Currency             Accumulated Other
                                    Translation Adjustment          Comprehensive Income
                                ---------------------------    -----------------------------
<S>                             <C>                            <C>
Balance at December 31, 2004                              -                               -
Change for 2005                                     111,684                         111,684

                                ----------------------------   -----------------------------
Balance at December 31, 2005                      $ 111,684                       $ 111,684
                                ============================   =============================
</TABLE>



                                      F-20
<PAGE>

               CHINA DIGITAL COMMUNICATION GROUP AND SUBSIDIARIES
                        (FORMERLY JASMINE'S GARDEN, INC.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005

 NOTE P - CURRENT VULNERABILITY DUE TO RISK FACTORS

         The Company's operations are carried out in the PRC.  Accordingly,  the
         Company's  business,  financial condition and results of operations may
         be influenced by the political,  economic and legal environments in the
         PRC, by the general state of the PRC's economy.  The Company's business
         may be influenced by changes in  governmental  policies with respect to
         laws and regulations,  anti-inflationary  measures, currency conversion
         and remittance abroad,  and rates and methods of taxation,  among other
         things.

NOTE Q - SUBSEQUENT EVENTS

         On January 1, 2006 The Company renewed an operating lease agreement for
         the office space in Los Angeles  that will  terminate on July 31, 2006.
         The office will serve as the new center of operations in North America.
         Monthly rent is $1,200.



                                      F-21