<PAGE>   1

                                                                     EXHIBIT 1.1


                      THE COMPANIES ORDINANCE (CHAPTER 32)

                           COMPANY LIMITED BY SHARES

                           MEMORANDUM OF ASSOCIATION

                                       OF

                        CHINA MOBILE (HONG KONG) LIMITED

                  (Formerly CHINA TELECOM (HONG KONG) LIMITED)


1  NAME

   The name of the Company is "CHINA MOBILE (HONG KONG) LIMITED".*

2  REGISTERED OFFICE

   The Registered Office of the Company will be situated in Hong Kong.

3  GENERAL OBJECTS AND POWERS

   The Company has the capacity and the rights, powers and privileges of a
   natural person and, in addition and without limit, the Company may do
   anything which it is permitted or required to do by any enactment or rule of
   law.

4  LIABILITY OF MEMBERS

   The liability of the members is limited.

5  CAPITAL

   The Capital of the Company is HK$10,000 divided into 100,000 shares of
   HK$0.10 each and the Company shall have power to divide the original or any
   increased capital into several classes, and to attach thereto any
   preferential, deferred, qualified, or other special rights, privileges,
   restrictions or conditions.**

----------------------

*  Pursuant to a Special Resolution passed on 16 June 2000, the name of the
   Company was changed to "China Mobile (Hong Kong) Limited" with effect from 28
   June 2000.

** By a Written Resolution passed on 27 September 1997, the Company's authorised
   share capital was increased from HK$10,000 to HK$1,600,000,000 by the
   creation of 15,999,900.000 new Ordinary Shares of HK$0.10 each and by an
   Ordinary Resolution passed at the Extraordinary General Meeting of the
   Company held on 10 November 2000, the Company's authorised share capital was
   further increased from HK$1,600,000,000 to HK$3,000,000,000 by the creation
   of 14,000,000,000 new Ordinary Shares of HK$1.00 each.



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<PAGE>   2
    We, the several persons whose names, addresses and descriptions are set out
    below, are desirous of being formed into a Company in pursuance of this
    Memorandum of Association, and we respectively agree to take the number of
    shares in the capital of the Company set opposite to our respective names:

<TABLE>
<CAPTION>
                                                                 NUMBER OF SHARES TAKEN
    NAMES ADDRESS AND DESCRIPTION OF SUBSCRIBERS                 BY EACH SUBSCRIBER
    --------------------------------------------                 ----------------------
    <S>                                                          <C>
    China Telecom (Hong Kong) Group Limited                                1
    Hong Kong company no. 569288, (formerly known as
    China Telecom (Hong Kong) Limited of 16/F, Dah Sing
    Financial Centre, 108 Gloucester Road, Wanchai, Hong
    Kong

    Corporation

    For and on behalf of China Telecom (Hong Kong) Group
    Limited

    (Sd.) Chen Zhaobin
    -------------------------------------------
    Director

    China Telecom Hong Kong (BVI) Limited                                  1
    BVI I.B.C. company no. 244168,
    of P.O. Box 957, Offshore Incorporations Centre,
    Road Town, Tortola, British Virgin Islands

    Corporation

    For and on behalf of China Telecom Hong Kong
    (BVI) Limited

    (Sd.) Chen Zhaobin
    -------------------------------------------
    Director

    Total Number of Shares Taken                                           2
    </TABLE>

    Dated the 29 day of August, 1997.

    WITNESS to the above signatures

    Celia C.L. Lam             (Sd. Celia Lam)
    Solicitor
    Hong Kong

    Address:
    14th Floor, Alexandra House
    Chater Road
    Central
    Hong Kong


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<PAGE>   3
                      THE COMPANIES ORDINANCE (CHAPTER 32)

                           COMPANY LIMITED BY SHARES

                          NEW ARTICLES OF ASSOCIATION
            (ADOPTED BY SPECIAL RESOLUTION PASSED ON 8 OCTOBER 1997)

                                       OF
                        CHINA MOBILE (HONG KONG) LIMITED
                  (FORMERLY CHINA TELECOM (HONG KONG) LIMITED)

                (INCLUSIVE OF ALTERATIONS UP TO 16 OCTOBER 1997)


                                  PRELIMINARY

1  The regulations in Table A in the First Schedule to the Ordinance shall not
   apply to the Company.

                                 INTERPRETATION

2  (a)   In these Articles save where the context otherwise requires;

         "AUDITORS" means the Auditors of the Company for the time being;

         "CHAIRMAN" means the Chairman presiding at any meeting of members or
         the Board;

         "COMPANY" means the above-named Company;

         "ORDINANCE" means the Companies (Chapter 32 of the Laws of Hong Kong),
         and includes every other ordinance incorporated therewith or
         substituted therefor; and in the case of any such substitution the
         references in these Articles to the provisions of the Ordinance shall
         be read as references to the provisions substituted therefor in the new
         ordinance;

         "BOARD" and "DIRECTORS" means the directors for the time being of the
         Company or the Directors present at a duly convened meeting of
         directors at which a quorum is present;

         "CALL" includes any instalment of a call and, in the application of
         provisions of these Articles to forfeiture of shares, a sum which, by
         the terms of issue of a share, is payable at a fixed time either in
         respect of the nominal value of the share or by way of premium;

         "CAPITAL" means the share capital from time to time of the Company;

         "CLEARING HOUSE" shall mean a recognised clearing house within the
         meaning of section 2 of the Securities and Futures (Clearing Houses)
         Ordinance;

         "DIVIDEND" includes distributions in specie or in kind, capital
         distributions and capitalisation issues;

         "DOLLARS" & "$" means dollars in the lawful currency of Hong Kong;

         "HONG KONG" means the Hong Kong Special Administrative Region of the
         People's Republic of China;

         "MONTH" means calendar month;


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         "OFFICE" means the registered office of the Company for the time being;

         "PAID UP" includes credited as paid up;

         "REGISTER" means the register of members of the Company kept pursuant
         to the Ordinance and includes any branch register kept pursuant to the
         Ordinance;

         "SEAL" means the common seal of the Company or any official seal that
         the Company may have as permitted by the Ordinance;

         "SECRETARY" means the person or persons appointed for the time being to
         perform for the Company the duties of a secretary;


         "SHARE" means a share in the capital of the Company and includes stock
         except where a distinction between stock and shares is expressed or
         implied;

         "STOCK EXCHANGE" means The Stock Exchange of Hong Kong Limited;

         "THESE ARTICLES" means these Articles of Association in their present
         form or as altered from time to time;

         "IN WRITING" and "WRITTEN" includes facsimile and telex messages and
         any mode of reproducing words in a legible and non-transitory form.



   (b)   In these Articles, if not inconsistent with the subject or context,
         words importing the singular number only shall include the plural
         number and vice versa, words importing any gender shall include all
         other genders and references to persons shall include corporations
         (acting, where applicable, by their duly authorised representatives).

   (c)   Subject as aforesaid, any words defined in the Ordinance shall, if not
         inconsistent with the subject or context, bear the same meaning in
         these Articles.

   (d)   The headings and any marginal notes are inserted for convenience only
         and shall not affect the construction of these Articles.

                                   THE OFFICE

3  The Office shall be at such place in Hong Kong as the Directors shall from
   time to time appoint.

                                     SHARES

4  Shares may be issued with a preferential or qualified right to dividends and
   in the distribution of assets of the Company and with a special, or without
   any right, of voting.

5  Without prejudice to any special rights, privileges or restrictions for the
   time being attached to any issued shares, any unissued or forfeited shares
   may be issued or re-issued upon such terms and conditions, and with such
   rights, privileges and restrictions attached thereto, whether in regard to
   dividends, voting, repayment or redemption of share capital, or otherwise, as
   the Company may, subject to the Ordinance, from time to time determine or, in
   the absence of any such determination, as the Directors shall determine.

6  The Board may, subject to the approval by the shareholders in general
   meeting, issue warrants to subscribe for any class of shares or securities of
   the Company on such terms as the Board may from time to time determine. Where
   warrants are issued to bearer, no certificate thereof shall be issued to
   replace one that has been lost unless the Board is satisfied beyond
   reasonable doubt that the original certificate thereof has been destroyed and
   the Company has received an


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   indemnity in such form as the Board shall think fit with regard to the issue
   of any such replacement certificate.

 7 Save as provided by contract or the Ordinance or these Articles to the
   contrary, all unissued shares shall be at the disposal of the Directors who
   may allot, grant options over or otherwise deal with or dispose of the same
   to such persons, at such times, for such consideration and generally upon
   such terms and conditions as they shall in their absolute discretion think
   fit, provided that no shares of any class shall be issued at a discount
   except in accordance with section 50 of the Ordinance.

 8 The Company may make arrangements on the issue of shares for a difference
   between the holders of such shares in the amount of calls to be paid and the
   time of payment of such calls.

 9 If by the conditions of allotment of any shares the whole or part of the
   issue price thereof shall be payable by instalments, every such instalment
   shall, when due, be paid to the Company by the person who for the time being
   and from time to time shall be the registered holder of the shares, or his
   legal personal representative.

10 Subject to the provisions of section 49 of the Ordinance, any preference
   share may, with the sanction of a special resolution, be issued on the terms
   that it is, or at the option of the Company is liable, to be redeemed.

11 Subject to the provisions of these Articles, except as required by law or
   ordered by a court of competent jurisdiction, no person shall be recognised
   by the Company as holding any share upon any trust, and except as aforesaid,
   the Company shall not be bound by or required in any way to recognise any
   contingent, future, partial or equitable interest in any share or in any
   fractional part of a share or any other right in respect of any share or any
   other claim to or in respect of any such share on the part of any person
   (even when having notice thereof) except an absolute right to the entirety
   thereof in the registered holder.

12 The Company may in connection with the issue of any shares exercise all
   powers of paying interest out of capital and of paying commission and
   brokerage conferred or permitted by the Ordinance.

13 No person shall become a member until his name shall have been entered into
   the Register.

                            JOINT HOLDERS OF SHARES

14 Where two or more persons are registered as the holders of any share they
   shall be deemed to hold the same as joint tenants with benefit of
   survivorship, subject to the following provisions:-

   (a)   the Company shall not be bound to register more than four persons as
         the holders of any shares except in the case of the legal personal
         representatives of a deceased member;

   (b)   the joint holders of any shares shall be liable severally as well as
         jointly in respect of all payments which ought to be made in respect of
         such shares;

   (c)   on the death of any one of such joint holders the survivor or
         survivors shall be the only person or persons recognised by the Company
         as having any title to such shares, but the Directors may require such
         evidence of death as they may deem fit;

   (d)   any one of such joint holders may give effectual receipts for any
         dividend, bonus or return of capital payable to such joint holders; and

   (e)   the Company shall be at liberty to treat the person whose name stands
         first in the Register as one of the joint holders of any shares as
         solely entitled to delivery of the


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<PAGE>   6
         certificate relating to such shares, or to receive notices from the
         Company, or to attend or vote at general meetings of the Company, and
         any notice given to such person shall be deemed notice to all the joint
         holders; but any one of such joint holders may be appointed the proxy
         of the persons entitled to vote on behalf of such joint holders, and as
         such proxy to attend and vote at general meetings of the Company, but
         if more than one of such joint holders be present at any meeting
         personally or by proxy that one so present whose name stands first in
         the Register in respect of such shares shall alone be entitled to vote
         in respect thereof.

                               SHARE CERTIFICATES

15 Every person whose name is entered as a member in the Register shall be
   entitled without payment to receive within two months after allotment or
   lodgment of an instrument of transfer duly stamped, or within such other
   period as the conditions of issue shall provide, one certificate for all his
   shares of any particular class, or if he shall so request, upon payment of a
   fee (not exceeding HK$2.50 or such greater sum as the Stock Exchange may from
   time to time permit) for every certificate after the first, as the Directors
   shall from time to time determine, such number of certificates for shares in
   Stock Exchange board lots or multiples thereof as he shall request and one
   for the balance (if any) of the shares in question, provided that in the
   event of a member transferring part of the shares represented by a
   certificate in his name a new certificate in respect of the balance thereof
   shall be issued in his name without payment and, in the case of a share or
   shares held jointly by several persons the Company shall not be bound to
   issue a certificate or certificates to each such person, and the issue and
   delivery of a certificate or certificates to one of several joint holders
   shall be sufficient delivery to all such holders.

16 Every share certificate shall be issued under the Seal (which for this
   purpose may be any official seal as permitted by section 73A of the
   Ordinance) and shall specify the number and class of shares and, if required,
   the distinctive numbers thereof, to which the certificate relates, and the
   amount paid up thereon and may otherwise be in such form as the Board may
   from time to time determine. If at any time the share capital of the Company
   is divided into different classes of shares, every share certificate issued
   at that time shall comply with section 57A of the Ordinance, and no
   certificate shall be issued in respect of more than one class of shares.

17 Subject to section 71A of the Ordinance, if any share certificate shall be
   worn out, defaced, destroyed or lost, it may be replaced on payment of such
   fee, if any (not exceeding HK$2.50 or such greater sum as the Stock Exchange
   may from time to time permit), on such evidence being produced as the
   Directors shall require, and in case of wearing out or defacement, on
   delivery up of the old certificate, and in case of destruction or loss, on
   the execution of such indemnity (if any), as the Directors may require. In
   case of destruction or loss, the person to whom such replacement certificate
   is given shall also bear and pay to the Company all expenses incidental to
   the investigation by the Company of the evidence of such destruction or loss
   and of the production of such indemnity.

                                CALLS ON SHARES

18 (a)   The Directors may from time to time make calls upon the members in
         respect of all moneys unpaid on their shares whether on account of the
         nominal value of the shares or by way of premium but subject always to
         the terms of issue of such shares, and any such call may be made
         payable by instalments.

   (b)   Each member shall, subject to receiving at least fourteen days' notice
         specifying the time or times and place for payment, pay to the Company
         the amount called on his shares and at the time or times and place so
         specified. The non-receipt of a notice of


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<PAGE>   7


         any call by, or the accidental omission to give notice of a call to,
         any of the members shall not invalidate the call.

19 A call shall be deemed to have been made at the time when the resolution of
   the Directors authorising such call was passed. A call may be revoked, varied
   or postponed as to all or any of the members liable therefor as the Directors
   may determine. A person on whom a call is made will remain liable for calls
   made upon him notwithstanding the subsequent transfer of the shares in
   respect whereof the call was made.

20 If any part of a call be not paid before or on the day appointed for payment
   thereof, the person from whom the payment is due shall be liable to pay all
   costs, charges and expenses that the Company may have incurred by reason of
   such non-payment together with interest on the outstanding part thereof at
   such rate as the Directors shall determine (not exceeding twenty per cent.
   per annum) from the day appointed for the payment of such call or instalment
   to the time of discharge thereof in full; but the Directors may, if they
   shall think fit, waive the payment of such costs, charges, expenses or
   interest or any part thereof.

21 If, by the terms of the issue of any shares or otherwise, any amount is made
   payable upon allotment or at any fixed time, whether on account of the
   nominal amount of the shares or by way of premium, every such amount shall be
   payable as if it were a call duly made and payable on the date on which by
   the terms of issue the same becomes payable; and all the provisions hereof
   with respect to the payment of calls and interest thereon, or to the
   forfeiture of shares for non-payment of calls shall apply to every such
   amount and the shares in respect of which it is payable in the case of
   non-payment thereof.

22 The Directors may, if they shall think fit, receive from any member willing
   to advance the same (either in money or money's worth) all or any part of the
   moneys uncalled and unpaid or instalments payable upon any shares held by
   him; and upon all or any of the moneys so paid in advance the Directors may
   (until the same would, but for such payment in advance, become presently
   payable) pay interest at such rate as may be agreed upon between the member
   paying the moneys in advance and the Directors (not exceeding twenty per
   cent. per annum). But a payment in advance of a call shall not entitle the
   shareholder to receive any dividend or to exercise any other rights or
   privileges as a shareholder in respect of the share or the due portion of the
   shares upon which payment has been advanced by such shareholder before it is
   called. The Directors may also at any time repay the amount so advanced upon
   giving to such member one month's notice in writing unless before the
   expiration of such notice the amount so advanced shall have been called up on
   the shares in respect of which it was advanced.

23 On the trial or hearing of any action for the recovery of any money due for
   any call, it shall be sufficient to prove that the name of the member sued is
   entered in the Register as the holder, or one of the holders, of the shares
   in respect of which such money is due; that the resolution making the call is
   duly recorded in the minute book of the Company; and that notice of such call
   was duly given to the member sued in pursuance of these Articles, and it
   shall not be necessary to prove the appointment of the Directors who made
   such call, nor any other matter whatsoever, but the proof of the matters
   aforesaid shall be conclusive evidence that the money is due.

24 No member shall, unless the Directors otherwise determine, be entitled to
   receive any dividend or bonus, or to receive notice of or to be present or
   vote at any general meeting, either personally or (save as proxy for another
   member) by proxy, or to exercise any privileges as a member, or be reckoned
   in a quorum, until he shall have paid all calls or other sums for the time
   being due and payable on every share held by him, whether alone or jointly
   with any other person, together with interest and expenses (if any).


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                                   FORFEITURE

25 If any member fails to pay in full any call or any instalment of a call on
   the day appointed for payment thereof, the Directors may at any time
   thereafter, during such time as any part of the call remains unpaid without
   prejudice to the provisions of Article 24, serve a notice on him requiring
   him to pay so much of the call as is unpaid together with interest accrued
   and any expenses incurred by reason of such non-payment.

26 The notice shall name a further day (not being less than fourteen days from
   the date of the notice) on or before which such call or part thereof and all
   interest accrued and expenses incurred by reason of such non-payment are to
   be paid, and it shall also name the place where payment is to be made, such
   place being either the Office, or some other place at which calls of the
   Company are usually made payable. The notice shall also state that, in the
   event of non-payment at or before the time and at the place appointed, the
   shares in respect of which such call is payable will be liable to forfeiture.

27 If the requirements with regard to payment of any such notice as aforesaid be
   not complied with, any shares in respect of which such notice has been given
   may, at any time thereafter and before the payment required by the notice has
   been made, be forfeited by a resolution of the Directors to that effect, and
   any such forfeiture shall extend to all dividends and bonuses declared in
   respect of the shares so forfeited but not payable until after such
   forfeiture. The Directors may accept the surrender of any shares liable to be
   forfeited hereunder and in such cases references in these Articles to
   forfeiture shall include surrender.

28 Any shares so forfeited shall be deemed for the purposes of this Article to
   be the property of the Company and may be sold, re-allotted or otherwise
   disposed of either subject to or discharged from all calls made prior to the
   forfeiture, to any person, upon such terms as to subscription price and
   otherwise and in such manner and at such time or times as the Directors think
   fit. For the purpose of giving effect to any such sale or other disposition
   the Directors may authorise the transfer of the shares so sold or otherwise
   disposed of to the purchaser thereof or any other person becoming entitled
   thereto. The Directors shall account to the person whose shares have been
   forfeited with the balance (if any) of monies received by the Company in
   respect of those shares after deduction of expenses of forfeiture, sale or
   disposal of the shares and any amounts due to the Company in respect of the
   shares.

29 The Directors may, at any time before any shares so forfeited shall have been
   sold, re-allotted or otherwise disposed of, annul the forfeiture thereof upon
   such conditions as they think fit or permit the share forfeited to be
   redeemed upon the terms of payment of all calls and interest due thereon and
   all expenses incurred in respect of the share, and upon such further terms
   (if any) as it thinks fit.

30 Any person whose shares have been forfeited shall cease to be a member in
   respect of the forfeited shares but shall notwithstanding the forfeiture be
   and remain liable to pay to the Company all moneys which, at the date of
   forfeiture, were payable by him to the Company in respect of the shares,
   together with interest thereon from the date of forfeiture until payment at
   such rate as the Directors may prescribe (not exceeding twenty per cent. per
   annum), and the Directors may enforce the payment of such moneys or any part
   thereof and without any deduction or allowance for the value of the shares at
   the date of forfeiture, but his liability shall cease if and when the Company
   shall have received payment in full of all such moneys in respect of the
   shares. For the purposes of this Article any sum which, by the terms of issue
   of a share, is payable thereon at a fixed time which is subsequent to the
   date of forfeiture, whether on account of the nominal value of the share or
   by way of premium, shall notwithstanding that that time has not yet arrived
   be deemed to be payable at the date of forfeiture, and the same shall become
   due


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<PAGE>   9


   and payable immediately upon the forfeiture, but interest thereon shall only
   be payable in respect of any period between the said fixed time and the date
   of actual payment.

31 When any shares have been forfeited, notice of the resolution shall be given
   to the member in whose name it stood immediately prior to the forfeiture and
   an entry shall be made in the Register recording the forfeiture and the date
   thereof but no forfeiture shall be in any manner invalidated by any omission
   or neglect to give such notice or make any such entry, and so soon as the
   shares so forfeited have been sold or otherwise disposed of an entry shall
   also be made of the manner and date of the sale or disposal thereof.

                                      LIEN

32 The Company shall have a first and paramount lien on every share (not being a
   fully paid-up share) for all moneys outstanding in respect of such share
   whether presently payable or not, and the Company shall also have a first and
   paramount lien on every share (other than fully paid-up shares) standing
   registered in the name of a member, whether singly or jointly with any other
   person or persons, for all the debts and liabilities of such member or his
   estate to the Company, whether the same shall have been incurred before or
   after notice has been given to the Company of any interest of any person
   other than such member, and whether the time for the payment or discharge of
   the same shall have already arrived or not, and notwithstanding that the same
   are joint debts or liabilities of such member or his estate and any other
   person, whether a member or not. The Company's lien on a share shall extend
   to all dividends payable thereon. The Directors may at any time either
   generally or in any particular case waive any lien that has arisen, or
   declare any share to be wholly or in part exempt from the provisions of this
   Article.

33 The Company may sell in such manner as the Directors think fit any share on
   which the Company has a lien, but no sale shall be made unless some sum in
   respect of which the lien exists is presently payable or the liability or
   engagement in respect of which such lien exists is liable to be presently
   fulfilled or discharged, nor until the expiration of fourteen days after a
   notice in writing stating and demanding payment of the sum presently payable
   and giving notice of intention to sell in default shall have been given to
   the holder for the time being of the share or the person entitled thereto by
   reason of his death, bankruptcy or winding-up or otherwise by operation of
   law or court order.

34 The net proceeds of such sale after payment of the costs of such sale shall
   be applied in or towards payment or satisfaction of the debts or liabilities
   in respect whereof the lien exists so far as the same are presently payable
   and any residue shall (subject to a like lien for debts or liabilities not
   presently payable as existed upon the shares prior to the sale) be paid to
   the person entitled to the shares at the time of the sale. For giving effect
   to any such sale the Directors may authorise some person to transfer the
   shares so sold to the purchaser thereof and may enter the purchaser's name in
   the Register as holder of the shares, and the purchaser shall not be bound to
   see to the application of the purchase money, nor shall his title to the
   shares be affected by any irregularity or invalidity in the proceedings in
   reference to the sale.

35 A statutory declaration in writing that the declarant is a Director or the
   Secretary of the Company and that a share has been duly forfeited or
   surrendered or sold on a date stated in the declaration shall be conclusive
   evidence of the facts therein stated as against all persons claiming to be
   entitled to the share. Such declaration and the receipt of the Company for
   the consideration (if any) given for the share on the sale, re-allocation or
   disposal thereof together with the share certificate delivered to a purchaser
   or allottee thereof shall (subject to the execution of a transfer if the same
   be required) constitute a good title to the share and the person to whom the
   share is sold, re-allotted or disposed of shall be registered as the holder
   of the share and shall not be bound to see to the application of the
   purchase money (if any) nor shall his title to the share be


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<PAGE>   10


   affected by any irregularity or invalidity in the proceedings in reference to
   the forfeiture, surrender, sale, re-allotment or disposal of the share.

                               TRANSFER OF SHARES

36 The instrument of transfer of any shares in the Company shall be in writing
   in the usual common form or in such other form as the Board may accept and
   may be under hand only or, if the transferor or transferee is a Clearing
   House (or its nominee), by hand or by machine imprinted signature or by such
   other manner of execution as the Board may approve from time to time and
   shall be executed by or on behalf of the transferor and by or on behalf of
   the transferee. The transferor shall remain the holder of the shares
   concerned until the name of the transferee is entered in the Register in
   respect thereof. Nothing in these Articles shall preclude the Board from
   recognising a renunciation of the allotment or provisional allotment of any
   share by the allottee in favour of some other person.

37 Every instrument of transfer shall be lodged at the Office for registration
   (or at such other place as the Board may appoint for such purpose)
   accompanied by the certificate relating to the shares to be transferred and
   such other evidence as the Directors may require in relation thereto. All
   instruments of transfer which shall be registered shall be retained by the
   Company, but save where fraud is suspected any instrument of transfer which
   the Directors may decline to register shall, on demand, be returned to the
   person depositing the same.

38 There shall be paid to the Company in respect of the registration of a
   transfer and of any Grant of Probate or Letters of Administration,
   Certificate of Marriage or Death, Power of Attorney or other document
   relating to or affecting the title to any share or for making of any entry in
   the Register affecting the title to any share such fee (if any) as the
   Directors may from time to time require or prescribe (but not exceeding
   HK$2.50 or such greater sum as the Stock Exchange may from time to time
   permit).

39 The registration of transfers may be suspended at such times and for such
   periods as the Directors may, in accordance with section 99 of the Ordinance,
   from time to time determine and either generally or in respect of any class
   of shares.

40 The Directors may, subject to section 69 of the Ordinance, at any time in
   their absolute discretion and without assigning any reason therefor decline
   to register any transfer of any share (not being a fully paid-up share). If
   the Directors refuse to register a transfer they shall, within two months
   after the date on which the transfer was lodged with the Company, send to the
   transferor and transferee notice of the refusal.

41 The Directors may also decline to register any transfer unless:-

   (a)   the instrument of transfer is in respect of only one class of share;

   (b)   in the case of a transfer to joint holders, the number of transferees
         does not exceed four;

   (c)   the shares concerned are free of any lien in favour of the Company;

   (d)   the instrument of transfer is properly stamped;

   (e)   such other conditions as the Directors may from time to time impose for
         the purpose of guarding against losses arising from forgery are
         satisfied;

   (f)   a fee not exceeding the maximum fee prescribed or permitted from time
         to time by the Stock Exchange is paid to the Company in respect
         thereof;


                                       8
<PAGE>   11


   (g)   the instrument of transfer is accompanied by the certificate of the
         shares to which it relates, and such other evidence as the Board may
         reasonably require to show the right of the transferor to make the
         transfer.

42 No transfer may be made to an infant or to a person of unsound mind or under
   other legal disability.

                             TRANSMISSION OF SHARES

43 In the case of the death of a member, the survivor or survivors where the
   deceased was a joint holder, and the legal personal representatives of the
   deceased where he was a sole or only surviving holder, shall be the only
   persons recognised by the Company as having any title to his shares; but
   nothing herein contained shall release the estate of a deceased holder,
   whether sole or joint, from any liability in respect of any share solely or
   jointly held by him.

44 Any person becoming entitled to shares in the Company in consequence of the
   death, bankruptcy or winding-up of any member or otherwise by operation of
   law or by court order shall, upon producing such evidence of his title as the
   Directors may require, have the right either to be registered himself as the
   holder of the shares upon giving to the Company notice in writing of such his
   desire or to transfer such shares to some other person. All the limitations,
   restrictions and provisions of these Articles and the Ordinance relating to
   the right to transfer and the registration of transfers of shares shall be
   applicable to any such notice or transfer as if the same were a transfer of
   shares by a member, including the Directors' right to refuse or suspend
   registration.

45 A person becoming entitled to shares in the Company in consequence of the
   death, bankruptcy or winding-up of any member or otherwise by operation of
   law or by court order shall have the right to receive and give a discharge
   for any dividends or other moneys payable in respect of the shares, provided
   always that the Directors may at any time give notice requiring any such
   person to elect to be registered himself or to transfer the shares, and if
   the notice is not complied with within sixty days, the Directors may
   thereafter withhold payment of all dividends or other moneys payable in
   respect of the shares until the requirements of the notice have been complied
   with but subject to the requirements of Article 76 being met, such a person
   may vote at meetings.

                                     STOCK

46 The Company may from time to time by ordinary resolution convert any fully
   paid-up shares into stock and may reconvert any stock into fully paid-up
   shares of any denomination. After the passing of any resolution converting
   all the fully paid-up shares of any class in the capital of the Company into
   stock, any shares of that class which subsequently become fully paid-up and
   rank pari passu in all other respects with such shares shall, by virtue of
   this Article and such resolution, be converted into stock transferable in the
   same units as the shares already converted.

47 The holders of stock may transfer the same or any part thereof in the same
   manner and subject to the same regulations as the shares from which the stock
   arose might prior to conversion have been transferred or as near thereto as
   circumstances admit. The Directors may from time to time fix the minimum
   amount of stock transferable and restrict or forbid the transfer of fractions
   of such minimum, but the minimum shall not, without the sanction of an
   ordinary resolution of the Company, exceed the nominal amount of each of the
   shares from which the stock arose. No warrants to bearer shall be issued in
   respect of any stock.

48 The holders of stock shall, according to the amount of the stock held by
   them, have the same rights as regards dividends, participation in assets on a
   winding-up, voting at general meetings of the Company and other matters as if
   they held the shares from which the stock arose, but no such right (except as
   to participation in dividends, profits and in assets on a reduction of
   capital


                                       9
<PAGE>   12


   or a winding up) shall be conferred by an amount of stock which would not, if
   existing in shares, have conferred such right.

49 Such of these Articles as are applicable to fully paid-up shares shall apply
   mutatis mutandis to stock, and the words "share" and "shareholder" shall
   include "stock" and "stockholder".

                              INCREASE OF CAPITAL

50 The Company may, from time to time, by ordinary resolution increase its
   authorised capital by such sum divided into shares of such amounts as the
   resolution shall prescribe.

51 The general meeting resolving upon the creation of any new shares may direct
   that the same or any of them shall be offered in the first instance, and
   either at par or at a premium or (subject to the provisions of the Ordinance)
   at a discount, to all the holders for the time being of any class of shares
   in the capital of the Company, in proportion to the number of shares of such
   class held by them respectively, or make any other provisions as to the issue
   and allotment of the new shares, and in default of any such direction, or so
   far as the same shall not extend, the new shares shall be at the disposal of
   the Directors, and Article 7 shall apply thereto. The Company may exercise
   any powers conferred or permitted by the Ordinance or any other ordinance
   from time to time to purchase or otherwise acquire its own shares and
   warrants (including any redeemable shares) at any price or to give, directly
   or indirectly, by means of a loan, guarantee, the provision of security or
   otherwise, financial assistance for the purpose of or in connection with a
   purchase or other acquisition made or to be made by any person of any shares
   or warrants in the Company and should the Company purchase or otherwise
   acquire its own shares or warrants neither the Company nor the Board shall be
   required to select the shares or warrants to be purchased or otherwise
   acquired ratably or in any other particular manner as between the holders of
   shares or warrants of the same class or as between them and the holders of
   shares or warrants of any other class or in accordance with the rights as to
   dividends or capital conferred by any class of shares provided always that
   any such purchase or other acquisition or financial assistance shall only be
   made or given in accordance with any relevant rules or regulations issued by
   the Stock Exchange or the Securities and Futures Commission from time to time
   in force.

52 Subject to any direction or determination that may be given or made in
   accordance with the powers contained in these Articles, all new shares
   created pursuant to Article 50 shall be subject to the same provisions herein
   contained with reference to the payment of calls, transfer, transmission,
   forfeiture, lien and otherwise as the existing shares of the Company.

                          ALTERATIONS OF SHARE CAPITAL

53 The Company may by ordinary resolution:-

   (a)   subdivide its existing shares or any of them into shares of smaller
         amount than is fixed by the Memorandum of Association of the Company,
         provided that in the subdivision of an existing share the proportion
         between the amount paid and the amount (if any) unpaid on each reduced
         share shall be the same as it was in the case of the share from which
         the reduced share is derived, and so that the resolution whereby any
         share is subdivided may determine that as between the holders of the
         shares resulting from such subdivision one or more of the shares may,
         as compared with the others, have any such preferred, deferred or other
         special rights or be subject to any such restrictions as the Company
         has power to attach to unissued or new shares;

   (b)   divide its shares into several classes and attach thereto respectively
         any preferential, deferred, qualified or special rights, privileges or
         conditions;


                                       10
<PAGE>   13


   (c)   consolidate and divide its capital or any part thereof into shares of
         larger amount than its existing shares;

   (d)   cancel any shares which at the date of the passing of the resolution
         have not been taken or agreed to be taken by any person and diminish
         the amount of its authorised capital by the amount of the shares so
         cancelled; or

   (e)   make provision for the issue and allotment of shares which do not carry
         any voting rights.

54 The Company may by special resolution reduce its share capital and any
   capital redemption reserve fund or any share premium account in any manner
   allowed by law.

55 Where any difficulty arises in regard to any consolidation and division under
   paragraph (c) of Article 53, the Directors may settle the same as they think
   expedient and in particular may arrange for the sale of the shares
   representing fractions and the distribution of the net proceeds of sale in
   due proportion amongst the members who would have been entitled to the
   fractions, and for this purpose the Directors may authorise some person to
   transfer the shares representing fractions to the purchaser thereof, who
   shall not be bound to see to the application of the purchase money nor shall
   his title to the shares be affected by any irregularity or invalidity in the
   proceedings relating to the sale.

                             MODIFICATION OF RIGHTS

56 All or any of the special rights attached to any class of shares (unless
   otherwise provided for by the terms of issue of the shares of that class) for
   the time being in issue may subject to the provisions of the Ordinance, at
   any time, as well before as during liquidation, be altered or abrogated
   either with the consent in writing of the holders of not less than
   three-fourths of the issued shares of that class or with the sanction of a
   special resolution passed at a separate general meeting of the holders of
   shares of that class, and all the provisions contained in these Articles
   relating to general meetings shall mutatis mutandis apply to every such
   meeting but so that the quorum thereof shall be not less than two persons
   holding or representing by proxy one third in nominal value of the issued
   shares of the class, and that any holder of shares of that class present in
   person or by proxy may demand a poll.

57 The provisions of the foregoing Article shall apply to the variation or
   abrogation of the special rights attached to some only of the shares of any
   class as if each group of shares of the class differently treated formed a
   separate class the rights whereof are to be varied.

58 The special rights conferred upon the holders of the shares or class of
   shares shall not unless otherwise expressly provided in the rights attaching
   to or the terms of issue of such shares, be deemed to be altered by the
   creation or issue of further shares ranking pari passu therewith.

                                GENERAL MEETINGS

59 The Company shall in each year hold a general meeting as its annual general
   meeting in addition to any other meetings in that year. The annual general
   meeting shall be held at such time (within a period of not more than fifteen
   months, or such longer period as the Registrar of Companies may authorise in
   writing, after the holding of the last preceding annual general meeting) and
   place as may be determined by the Directors. All other general meetings shall
   be called extraordinary general meetings.

60 The Directors may whenever they think fit, and shall on requisition in
   accordance with the Ordinance, proceed to convene an extraordinary general
   meeting.


                                       11
<PAGE>   14

                           NOTICE OF GENERAL MEETINGS

61 Subject to section 116C of the Ordinance, an annual general meeting and a
   meeting called for the passing of a special resolution shall be called by not
   less than 21 days' notice in writing, and any other general meeting shall be
   called by not less than fourteen days' notice in writing. The notice shall
   specify the place, date and time of meeting, and, in the case of special
   business, the general nature of that business. The notice convening an annual
   general meeting shall specify the meeting as such, and the notice convening a
   meeting to pass a special resolution shall specify the intention to propose
   the resolution as a special resolution. There shall appear on every such
   notice with reasonable prominence a statement that a member entitled to
   attend and vote is entitled to appoint one or more proxies to attend and vote
   instead of him and that a proxy need not be a member of the Company.

62 Notwithstanding that a meeting of the Company is called by shorter notice
   than that specified in these Articles or required by the Ordinance, it shall
   be deemed to have been duly called if it is so agreed:-

   (a)   in the case of a meeting called as the annual general meeting, by all
         the members entitled to attend and vote thereat; and

   (b)   in the case of any other meeting, by a majority in number of the
         members having the right to attend and vote at the meeting, being a
         majority together holding not less than 95 per cent in nominal value of
         the shares giving that right.

63 The accidental omission to give notice of a meeting or (in cases where
   instruments of proxy are sent out with the notice) the accidental omission to
   send such instrument of proxy to, or the nonreceipt of notice of a meeting or
   such instrument of proxy by, any person entitled to receive such notice shall
   not invalidate the proceedings at that meeting.

                        PROCEEDINGS AT GENERAL MEETINGS

64 All business shall be deemed special that is transacted at an extraordinary
   general meeting and at an annual general meeting with the exception of:-

   (a)   the receipt of the accounts and balance sheet and the reports of the
         Directors and other documents required to be annexed to the accounts;

   (b)   the declaration and sanction of dividends;

   (c)   the election of Directors in place of those retiring (if any);

   (d)   the election or re-election of the Auditors of the Company; and

   (e)   the fixing of, or the determination of the method of fixing, the
         remuneration or extra remuneration of the Directors and of the Auditors
         of the Company.

65 No business save the election of a chairman of the meeting shall be
   transacted at any general meeting unless a quorum is present when the meeting
   proceeds to business. Two members present in person or by proxy and entitled
   to vote shall be a quorum for all purposes.

66 If, within fifteen minutes from the time appointed for the meeting a quorum
   be not present, the meeting, if convened upon requisition in accordance with
   the Ordinance, shall be dissolved; but in any other case it shall stand
   adjourned to the same day in the next week at the same time and place, or to
   such other day, time and place as the Chairman of the meeting may determine.
   If at such adjourned meeting a quorum be not present within fifteen minutes
   from the time appointed for the meeting, the member or members present in
   person or by proxy shall be a quorum and may transact the business for which
   the meeting is called.


                                       12
<PAGE>   15
67 The Chairman (if any) of the Board or, in his absence, a Deputy Chairman
   (if any) shall preside as Chairman at every general meeting. If there is no
   such Chairman or Deputy Chairman, or if at any meeting neither the Chairman
   nor a Deputy Chairman is present within fifteen minutes after the time
   appointed for holding the meeting, or if neither of them is willing to act as
   Chairman, the Directors present shall choose one of their number to act, or
   if one Director only is present he shall preside as Chairman if willing to
   act. If no Director is present, or if each of the Directors present declines
   to act as Chairman, the persons present and entitled to vote shall elect one
   of their number to be Chairman of the meeting.

68 The Chairman of any general meeting at which a quorum is present may, with
   the consent of the meeting, and shall, if so directed by the meeting, adjourn
   the meeting from time to time and from place to place or sine die; but no
   business shall be transacted at any adjourned meeting other than business
   which might have been transacted at the meeting from which the adjournment
   took place unless due notice thereof is given or such notice is waived in the
   manner prescribed by these Articles. When a meeting is adjourned for thirty
   days or more, or sine die, notice of the adjourned meeting shall be given as
   in the case of an original meeting. Save as aforesaid, it shall not be
   necessary to give any notice of an adjourned meeting or the business to be
   transacted thereat. Where a meeting is adjourned sine die the time and place
   for the adjourned meeting shall be fixed by the Directors.

                                     VOTING

69 (a)   At any general meeting a resolution put to the vote of the meeting
         shall be decided on a show of hands unless (before or on the
         declaration of the result of the show of hands or on the withdrawal of
         any other demand for a poll) a poll is demanded by:-

         (i)      the Chairman of the meeting; or

         (ii)     at least three members present in person (or in the case of a
                  member being a corporation, by its duly authorised
                  representative) or by proxy and entitled to vote at the
                  meeting; or

         (iii)    any member or members present in person (or in the case of a
                  member being a corporation, by its duly authorised
                  representative) or by proxy and representing in the aggregate
                  not less than one-tenth of the total voting rights of all
                  members having the right to attend and vote at the meeting; or

         (iv)     any member or members present in person (or in the case of a
                  member being a corporation, by its duly authorised
                  representative) or by proxy and holding shares conferring a
                  right to attend and vote at the meeting on which there have
                  been paid up sums in the aggregate equal to not less than
                  one-tenth of the total sum paid up on all shares conferring
                  that right.

   (b)   Unless a poll is so demanded and the demand is not withdrawn, a
         declaration by the Chairman that a resolution has, on a show of hands,
         been carried unanimously or by a particular majority or lost shall be
         final and conclusive, and an entry to that effect in the minute book of
         the Company shall be conclusive evidence of the fact without proof of
         the number or proportion of the votes recorded for or against such
         resolution.

70 A demand for a poll may be withdrawn only with the approval of the
   Chairman of the meeting, at any time before the close of the meeting or the
   taking of the poll, whichever is earlier. If a poll be directed or demanded
   in the manner (including the use of ballot or voting papers or tickets) above
   mentioned it shall (subject to the provisions of Article 72 hereof) be taken
   at such time (being not later than thirty days after the date of the demand)
   and in such manner as the Chairman of the meeting may appoint. No notice need
   be given of a poll not taken immediately. The result of such


                                       13
<PAGE>   16
   poll shall be deemed for all purposes to be the resolution of the meeting at
   which the poll was so directed or demanded.

71 In the case of an equality of votes at any general meeting, whether upon a
   show of hands or on a poll, the Chairman of the meeting shall be entitled to
   a second or casting vote.

72 A poll demanded upon the election of a Chairman or upon a question of
   adjournment shall be taken forthwith. Any business, other than that upon
   which a poll has been demanded, may be proceeded with pending the taking of
   the poll.

73 (a)   Save as expressly provided in these Articles, no person other than a
         member duly registered and who shall have paid everything for the time
         being due from him payable to the Company in respect of his shares
         shall be entitled to be present or to vote (save as proxy for another
         member) either personally or by proxy, or to be reckoned in a quorum at
         any general meeting.

   (b)   No objection shall be made to the validity of any vote except at a
         meeting at which such vote shall be tendered and every vote whether
         given personally or by proxy not disallowed at such meeting shall be
         deemed valid for all purposes whatsoever of such meeting or poll.

   (c)   In case of any dispute as to voting the Chairman shall determine the
         same, and such determination shall be final and conclusive.

74 Subject to the provisions of the Ordinance, a resolution in writing signed by
   all the members for the time being entitled to receive notice of and to
   attend and vote at general meetings shall be as valid and effective as if the
   same had been passed at a general meeting of the Company duly convened and
   held. A written notice of confirmation of such resolution in writing signed
   by or on behalf of a member shall be deemed to be his signature to such
   resolution in writing for the purposes of this Article. Such resolution in
   writing may consist of several documents each signed by or on behalf of one
   or more members.

                                VOTES OF MEMBERS

75 Subject to Article 85 and to any special rights, privileges or restrictions
   as to voting for the time being attached to any class or classes of shares,
   every member who (being an individual) is present in person or (being a
   corporation) is present by a representative duly authorised under section 115
   of the Ordinance at any general meeting shall be entitled, on a show of
   hands, to one vote only and, on a poll, to one vote for every fully paid-up
   share of which he is the holder.

76 Any person entitled under Article 45 to be registered as the holder of any
   shares may vote at any general meeting in respect thereof in the same manner
   as if he were the registered holder of such shares, provided that at least 48
   hours before the time of the holding of the meeting or adjourned meeting (as
   the case may be) at which he proposes to vote, he shall satisfy the Board of
   his right to be registered as the holder of such shares or the Board shall
   have previously admitted his right to vote at such meeting in respect
   thereof.

77 On a poll, votes may be given either personally or by proxy and a member
   entitled to more than one vote need not use all his votes or cast all the
   votes he uses in the same way.

78 A member of unsound mind, or in respect of whom an order has been made by any
   court having jurisdiction in lunacy, may vote, whether on a show of hands or
   on a poll, by his committee, curator bonis or other person in the nature of a
   committee or curator bonis appointed by that court, and any such committee,
   curator bonis or other person may on a poll, vote by proxy. If any member be
   a minor he may vote by his guardian or one of his guardians who may give
   their votes personally or by proxy.


                                       14


<PAGE>   17


                                    PROXIES

79 (a)   A proxy need not be a member of the Company.

   (b)   An instrument appointing a proxy shall be in writing in any usual or
         common form or in any other form which the Directors may accept, and
         shall be deemed, subject to the proviso hereinafter contained, to
         confer authority upon the proxy to vote on any resolution (or amendment
         thereto) put to the meeting for which it is given as the proxy thinks
         fit.

         Provided that any form issued to a member for use by him for appointing
         a proxy to attend and vote at an extraordinary general meeting or at an
         annual general meeting at which special business (determined as
         provided in Article 64) is to be transacted shall be such as to enable
         the member according to his intention to instruct the proxy to vote in
         favour of or against (or, in default of instructions, to exercise his
         discretion in respect of) each resolution dealing with any such special
         business and shall, unless the contrary is stated therein, be valid as
         well for any adjournment of the meeting as for the meeting to which it
         relates.

80 The instrument appointing a proxy shall be signed by the appointor, or his
   duly authorised attorney, or if such appointor be a corporation, under its
   common seal or signed by some officer, attorney or other person duly
   authorised in that behalf.

81 The instrument appointing a proxy and the power of attorney or other
   authority (if any) under which it is signed, or a notarially certified copy
   of such power or authority, shall be deposited at the Office at least
   forty-eight hours before the time fixed for holding the meeting at which the
   person named in such instrument proposes to attend and vote or, in the case
   of a poll, at least thirty-six hours before the time appointed for the taking
   of the poll; otherwise the person so named shall not be entitled to vote at
   that meeting (or as the case may be) except with the approval of the Chairman
   of the meeting. No instrument appointing a proxy shall be valid after the
   expiration of twelve months from the date of its execution, except at an
   adjourned meeting or on a poll demanded at a meeting or an adjourned meeting
   in cases where the meeting was originally held within twelve months from such
   date. Delivery of an instrument appointing a proxy shall not preclude a
   member from attending and voting in person at the meeting or poll concerned
   and, in such event, the instrument appointing a proxy shall be deemed to be
   revoked.

82 Any member may by power of attorney appoint any person to be his attorney for
   the purpose of attending and voting at any meeting, and such power may be a
   special power limited to any particular meeting or a general power extending
   to all meetings at which such member is entitled to vote. Every such power
   shall be deposited at the Office at least thirty-six hours before the time
   fixed for holding the meeting at which such attorney proposes to attend and
   vote or, in the case of a poll, at least twenty-four hours before the time
   appointed for the taking of the poll; otherwise the attorney shall not be
   entitled to vote at that meeting (or as the case may be) except with the
   approval of the Chairman of the meeting.

83 (a)   An instrument of proxy may be revoked by forwarding to the Office
         written notification of such revocation signed by or on behalf of the
         person who issued or authorised the issue of the instrument of proxy.

   (b)   A vote given in accordance with the terms of an instrument of proxy or
         power of attorney or by the duly authorised representative of a
         corporation shall be valid notwithstanding the previous death or
         insanity of the principal, or revocation of the proxy or power of
         attorney or other authority, or transfer of the shares in respect of
         which the proxy is given, provided no intimation in writing of the
         death, insanity, revocation or transfer shall have been received at the
         Office twenty-four hours at least


                                       15


<PAGE>   18


         before the time fixed for holding the meeting, or adjourned meeting, or
         the taking of the poll, at which the instrument of proxy is used.

84 Any corporation which is a member of the Company may, by resolution of its
   Directors or other governing body or by power of attorney, authorise such
   persons as it thinks fit to act as its representative at any meeting of the
   Company or of any class of members of the Company, and the person so
   authorised shall be entitled to exercise the same powers on behalf of the
   corporation which he represents as that corporation could exercise if it were
   an individual member of the Company. References in these Articles to a member
   present in person at a meeting shall, unless the context otherwise requires,
   include a corporation which is a member represented at the meeting by such
   duly authorised representative.

85 Without prejudice to the generality of Article 84 if a Clearing House (or its
   nominee) is a member of the Company, it (or, as the case may be, its nominee)
   may authorise such person or persons as it thinks fit to act as its proxy and
   proxies or representative or representatives at any meeting of the Company or
   at any meeting of any class of member of the Company provided that, if more
   than one person is so authorised, the authorisation shall specify the number
   and class of shares in respect of which each such person is so authorised. A
   person so authorised under the provisions of this Article shall be entitled
   to exercise the same powers on behalf of the Clearing House (or its nominee)
   which he represents as that Clearing House (or its nominee) could exercise if
   it were an individual member of the Company and, on a show of hands, each
   such person shall be entitled to a separate vote.

                                   DIRECTORS

86 Unless and until otherwise determined by an ordinary resolution of the
   Company, the Directors shall be not fewer than two in number, and there shall
   be no maximum number of Directors.

87 The Company shall keep in accordance with the Ordinance a register containing
   the names and addresses and occupations of its Directors and shall from time
   to time notify to the Registrar of Companies any change that takes place in
   such Directors as required by the Ordinance.

88 A Director need not hold any shares in the Company. A Director who is not a
   member of the Company shall nevertheless be entitled to attend and speak at
   general meetings.

                            DIRECTORS' REMUNERATION

89 (a)   The Directors shall be entitled to receive by way of remuneration for
         their services such sum as is from time to time determined by the
         Company in general meeting, such sum (unless otherwise directed by
         resolution by which it is voted) is to be divided amongst the Directors
         in such proportions and in such manner as the Board may agree, or
         failing agreement, equally, except that in such event any Director
         holding office for less than the whole of the relevant period in
         respect of which the remuneration is paid shall only rank in such
         division in proportion to the time during such period for which he has
         held office. The foregoing shall not apply to a Director who holds any
         salaried employment or office in the Company in the case of sums paid
         in respect of directors' fees.

   (b)   The Directors shall also be entitled to be repaid their reasonable
         travelling, hotel and other expenses incurred by them in or about the
         performance of their duties as Directors, including their expenses of
         travelling to and from board meetings, committee meetings or general
         meetings or otherwise incurred whilst engaged on the business of the
         Company or on the discharge of their duties as directors.


                                       16


<PAGE>   19


90 The Directors may award special remuneration out of the funds of the Company
   (by way of salary, commission or otherwise as the Directors may determine) to
   any Director who performs services which in the opinion of the Directors are
   outside the scope of the ordinary duties of a Director.

                              POWERS OF DIRECTORS

91 The Directors may establish any local boards or agencies for managing any of
   the affairs of the Company, either in Hong Kong or elsewhere, and may appoint
   any persons to be members of such local boards, or any managers or agents for
   the Company, and may fix their remuneration, and may delegate (with or
   without power to sub-delegate as the Directors shall determine) to any local
   board, manager or agent any of the powers, authorities and discretions vested
   in the Directors, and may authorise the members of any local boards, or any
   of them, to fill any vacancies therein, and to act notwithstanding vacancies,
   and any such appointment or delegation may be made upon such terms and
   subject to such conditions as the Directors may think fit, and the Directors
   may remove any person so appointed and may annul or vary any such delegation,
   but no person dealing in good faith and without notice of any such annulment
   or variation shall be affected thereby.

92 The Directors may from time to time and at any time by power of attorney or
   other instrument appoint any company, firm or person or any fluctuating body
   of persons, whether nominated directly or indirectly by the Board, to be the
   attorney or attorneys of the Company for such purposes and with such powers,
   authorities and discretions (not exceeding those vested in or exercisable by
   the Directors under these Articles) and for such period and subject to such
   conditions as they may think fit, and any such power of attorney or other
   instrument may contain such provisions for the protection and convenience of
   persons dealing with any such attorney as the Directors may think fit, and
   may also authorise any such attorney to sub-delegate all or any of the
   powers, authorities and discretions vested in him. The Company may, by
   writing under its seal, empower any person, either generally or in respect of
   any specified matter, as its attorney to execute deeds and instruments on its
   behalf and to enter into contracts and sign the same on its behalf and every
   deed signed by such attorney on behalf of the Company and under his seal
   shall bind the Company and have the same effect as if it were under the seal
   of the Company.

93 Subject to and to the extent permitted by the Ordinance, the Company or the
   Directors on behalf of the Company, may cause to be kept in any territory a
   Branch Register of members resident in such territory, and the Directors may
   make and vary such regulations as they may think fit respecting the keeping
   of any such Branch Register.

94 All cheques, promissory notes, drafts, bills of exchange, and other
   negotiable or transferable instruments, and all receipts for moneys paid to
   the Company, shall be signed, drawn, accepted, endorsed, or otherwise
   executed, as the case may be, in such manner as the Directors shall from time
   to time by resolution determine. The Company's bank accounts shall be kept
   with such banker or bankers as the Board shall from time to time determine.

95 (a)   The Directors may exercise all the powers of the Company to borrow
         money and to mortgage or charge all or any part of the undertaking,
         property and assets (present and future) and uncalled capital of the
         Company and to issue debentures, debenture stocks, bonds and other
         securities, whether outright or as collateral security for any debt,
         liability or obligation of the Company or of any third party.
         Debentures, debenture stocks, bonds and other securities of the Company
         may be made assignable free from any equities between the Company and
         the person to which the same may be issued, and may be issued at a
         discount, premium or otherwise and with any special privileges as to
         redemption, surrender, drawings, allotment of shares, attending and
         voting at general meetings of the Company, appointment of Directors and
         otherwise.


                                      17


<PAGE>   20


   (b)   The Directors shall cause a proper register to be kept, in accordance
         with the provisions of the Ordinance, of all mortgages and charges
         affecting the property of the Company and shall duly comply with the
         requirements of the Ordinance in regard to the registration of
         mortgages and charges therein specified and otherwise. Where any
         uncalled capital of the Company is charged, all persons taking any
         subsequent charge thereon shall take the same subject to such prior
         charge, and shall not be entitled, by notice to the members or
         otherwise, to obtain priority over such prior charge.

96 The Board may establish and maintain or procure the establishment and
   maintenance of any contributory or non-contributory pension or superannuation
   funds for the benefit of, or give or procure the giving of donations,
   gratuities, pensions, allowances or emoluments to any persons who are or were
   at any time in the employment or service of the Company, or of any company
   which is a subsidiary of the Company, or is allied or associated with the
   Company or with any such subsidiary company, or who are or were at any time
   directors or officers of the Company or of any such other company as
   aforesaid, and holding or who have held any salaried employment or office in
   the Company or such other company, and the wives, widows, families and
   dependants of any such persons. The Board may also establish and subsidise or
   subscribe to any institutions, associations, clubs or funds calculated to be
   for the benefit of or to advance the interests and well-being of the Company
   or of any such other company as aforesaid or of any such persons as
   aforesaid, and may make payments for or towards the insurance of any such
   persons as aforesaid, and subscribe or guarantee money for charitable or
   benevolent objects or for any exhibition or for any public, general or useful
   object. The Board may do any of the matters aforesaid, either alone or in
   conjunction with any such other company as aforesaid. Any Director holding
   any such employment or office shall be entitled to participate in and retain
   for his own benefit any such donation, gratuity, pension, allowance or
   emolument.

                      APPOINTMENT AND REMOVAL OF DIRECTORS

97 At each annual general meeting one-third of the Directors for the time being,
   or, if their number is not three or a multiple of three, then the number
   nearest one-third, shall retire from office by rotation save any Director
   holding office as Chairman or Chief Executive Officer. The Directors to
   retire in every year shall be those who have been longest in office since
   their last election but as between persons who became Directors on the same
   day shall (unless they otherwise agree between themselves) be determined by
   lot. The retiring Directors shall be eligible for re-election. The Company at
   any general meeting at which any Directors retire may fill the vacated
   offices. No person other than a Director retiring at the meeting shall,
   unless recommended by the Directors for election, be eligible for election as
   a Director at any general meeting unless not less than seven (7) days before
   the date appointed for the meeting there shall have been lodged at the Office
   or at the head office a Notice signed by a Member (other than the person to
   be proposed) duly qualified to attend and vote at the meeting for which such
   notice is given of his intention to propose such person for election and also
   a Notice signed by the person to be proposed of his willingness to be
   elected.

98 If at any general meeting at which an election of Directors ought to take
   place the places of the retiring Directors are not filled, the retiring
   Directors or such of them as have not had their places filled shall be deemed
   to have been re-elected and shall, if willing, continue in office until the
   next annual general meeting and so on from year to year until their places
   are filled, unless:

   (i)    it shall be determined at such meeting to reduce the number of
          Directors;

   (ii)   it is expressly resolved at such meeting not to fill up such vacated
          offices;

   (iii)  in any such case the resolution for re-election of a Director is put
          to the meeting and lost; or

                                       18
<PAGE>   21
         (iv)     such Director has given notice in writing to the Company that
                  he is not willing to be re-elected.

 99      The Company may, from time to time, by ordinary resolution elect any
         person to be a Director either to fill a casual vacancy or as an
         addition to the Board.

100      The Company may by special resolution remove any Director
         notwithstanding anything in these Articles or in any agreement between
         him and the Company (but without prejudice to any right to damages for
         termination of such agreement not in accordance with the terms
         thereof), and may, if thought fit, by ordinary resolution appoint
         another person in his stead. Any person so elected shall hold office
         for such time only as the Director in whose place he is elected would
         have held the same if he had not been removed.

101      The Directors shall have power, exercisable at any time and from time
         to time, to appoint any other person as a Director, either to fill a
         casual vacancy or as an addition to the Board but so that the number of
         Directors so appointed shall not exceed the maximum number determined
         from time to time (if any) by the shareholders in general meeting and
         any directors so appointed shall hold office only until the next
         following annual general meeting of the Company and shall then be
         eligible for re-election, but shall not be taken into account in
         determining the Directors or the number of Directors who are to retire
         by rotation at each annual general meeting.

102      The continuing Directors may act notwithstanding any vacancy in their
         body, but if and so long as the number of Directors is reduced below
         the number fixed by or pursuant to these Articles as the necessary
         quorum of Directors, the continuing Directors may act for the purpose
         of increasing the number of Directors to that number, or of summoning a
         general meeting of the Company, but for no other purpose. If there
         shall be no Directors able or willing to act, then any two members may
         summon a general meeting for the purpose of appointing Directors.

103      No person other than a retiring Director shall, unless recommended by
         the Board for re-election, be eligible for election to the office of
         Director at any annual general meeting unless notice in writing of the
         intention to propose that person for election as a Director and notice
         in writing by that person of his consent to be elected, shall have been
         lodged at the office or principal office of the Company at least seven
         days before the date of the annual general meeting.

                              ALTERNATE DIRECTORS

104      Each Director may by written notification to the Company nominate any
         other person to act as alternate Director in his place and at his
         discretion in similar manner remove such alternate Director. If such
         person is not another Director, such appointment, unless previously
         approved by the Board, shall have effect only upon and subject to being
         so approved. The alternate Director shall (except as regards the power
         to appoint an alternate) be subject in all respects to the terms and
         conditions existing with reference to the other Directors of the
         Company; and each alternate Director, whilst acting as such, shall
         exercise and discharge all the functions, powers and duties of the
         Director he represents, but shall look to such Director solely for his
         remuneration as alternate Director. Every person acting as an alternate
         Director shall (except when absent from Hong Kong) be entitled to
         receive notices of meetings of the Board and shall have one vote for
         each Director for whom he acts as alternate at any such meeting at
         which the Director appointing him is not personally present (in
         addition to his own vote if he is also a Director). The signature of an
         alternate Director to any resolution in writing of the Board or a
         committee of the Board shall, unless the notice of his appointment
         provides to the contrary, be as effective as the signature of his
         appointor. Any Director of the Company who is appointed an alternate
         director shall be considered as two Directors for the purpose of making
         a quorum of Directors. Any person appointed as an alternate Director
         shall vacate his office as such alternate Director if and when the
         Director by whom he has been appointed removes him or vacates office as
         Director. A


                                       19
<PAGE>   22

         Director shall not be liable for the acts or defaults of any alternate
         Director appointed by him. To such extent as the Board may from time to
         time determine in relation to any committee of the Board, the foregoing
         provisions of this paragraph shall also apply mutatis mutandis to any
         meeting of any committee of which his appointor is a member. An
         alternate Director shall not, save as aforesaid, have power to act as a
         Director nor shall he be deemed to be a Director for the purposes of
         these Articles.

                         DISQUALIFICATION OF DIRECTORS

105      The office of a Director shall ipso facto be vacated:-

         (a)      if he becomes prohibited by law or court order from being a
                  Director;

         (b)      if a receiving order or in the case of a company a winding-up
                  order is made against him or he makes any arrangement or
                  composition with his creditors;

         (c)      if he becomes of unsound mind;

         (d)      if he absents himself from the meetings of the Board during a
                  continuous period of six months, without special leave of
                  absence from the Board, and his alternate Director (if any)
                  shall not during such period have attended in his stead, and
                  the Board passes a resolution that he has by reason of such
                  absence vacated his office;

         (e)      if he shall be removed from office by notice in writing served
                  upon him signed by all his co-directors;

         (f)      if he resigns his office;

         (g)      if he is removed by a special resolution of the Company; or

         (h)      if he is convicted of an indictable offence.


                              DIRECTORS' INTERESTS

106      A Director who is in any way, whether directly or indirectly,
         interested in a contract or proposed contract with the Company shall
         declare the nature of his interest in accordance with the provisions of
         the Ordinance. A general notice given to the Directors by a Director to
         the effect that he is a member or a director of a specified company or
         firm, and is to be regarded as interested in any contract, arrangement
         or dealing which may, after the date of the notice, be entered into or
         made with that company or firm, shall, for the purpose of this Article,
         be deemed to be a sufficient disclosure of interest in relation to any
         contract, arrangement or dealing so entered into or made. Without
         prejudice to the generality of the foregoing, a Director shall give
         notice to the Company of such matters relating to himself as may be
         necessary for the purposes of sections 155B, 158, 161 and 161B of the
         Ordinance.

107      A Director may hold any other office or place of profit under the
         Company (other than the office of Auditor), and he or any firm of which
         he is a member may act in a professional capacity for the Company in
         conjunction with his office of Director, for such period and on such
         terms (as to remuneration and otherwise) as the Directors may determine
         and such extra remuneration shall be in addition to any remuneration
         provided for by or pursuant to any other Article. No Director or
         intended Director shall be disqualified by his office from contracting
         with the Company, nor shall any contract or arrangement entered into by
         or on behalf of the Company with any Director or any firm or company in
         which any Director is in any way interested be liable to be avoided,
         nor shall any Director so contracting or being so interested be liable
         to account to the Company for any profit, remuneration or other
         benefits realised by any such contract or arrangement by reason only of
         such Director holding that office or of any fiduciary relationship
         thereby established,


                                       20
<PAGE>   23

         provided that such Director shall disclose the nature of his interest
         in any contract or arrangement in which he is interested at the meeting
         of the board at which the question of entering into the contract or
         arrangement is first taken into consideration, if he knows his interest
         then exists, or in any other case at the first meeting of the Board
         after he knows that he is or has become so interested.

108      A Director shall not vote (nor shall he be counted in the quorum) on
         any resolution of the Board in respect of any contract or arrangement
         or proposal in which he is to his knowledge materially interested, and
         if he shall do so his vote shall not be counted (nor shall he be
         counted in the quorum for that resolution), but this prohibition shall
         not apply to any of the following matters, namely:-

         (i)      any contract or arrangement for the giving by the Company of
                  any security or indemnity to the Director in respect of money
                  lent or obligations incurred or undertaken by him at the
                  request of or for the benefit of the Company or any of its
                  subsidiaries;

         (ii)     any contract or arrangement for the giving by the Company of
                  any security to a third party in respect of a debt or
                  obligation of the Company or any of its subsidiaries for which
                  the Director has himself assumed responsibility or guaranteed
                  or secured in whole or in part whether alone or jointly;

         (iii)    any contract or arrangement concerning an offer of the shares
                  or debentures or other securities of or by the Company or any
                  other company which the Company may promote or be interested
                  in for subscription or purchase where the Director is or is to
                  be interested as a participant in the underwriting or
                  sub-underwriting of the offer;

         (iv)     any contract or arrangement in which the Director is
                  interested in the same manner as other holders of shares or
                  debentures or other securities of the Company by virtue only
                  of his interest in shares or debentures or other securities of
                  the Company;

         (v)      any contract or arrangement concerning any other company in
                  which the Director is interested whether directly or
                  indirectly as an officer or a shareholder or in which the
                  Director is beneficially interested in shares of that company
                  other than a company in which the Director together with any
                  of his associates is beneficially interested in 5 per cent. or
                  more of the issued shares of any class of the equity share
                  capital of such company (or of any third company through which
                  his interest is derived) or of the voting rights (excluding
                  for the purpose of calculating such five per cent. interest
                  any indirect interest of such Director or his associates by
                  virtue of an interest of the Company in such company);

         (vi)     any proposal or arrangement for the benefit of employees of
                  the Company or its subsidiaries including the adoption,
                  modification or operation of a pension fund or retirement,
                  death or disability benefit scheme which relates both to
                  Directors and employees of the Company or of any of its
                  subsidiaries and does not give the Director any privilege not
                  generally accorded to the class of persons to whom such scheme
                  or fund relates; and

         (vii)    any proposal or arrangement concerning the adoption,
                  modification or operation of any employees' share scheme
                  involving the issue or grant of options over shares or other
                  securities by the Company to, or for the benefit of, the
                  employees of the Company or its subsidiaries under which the
                  Director may benefit.

         If any question shall arise at any meeting of the Board as to the
         materiality of the interest of a Director (other than the Chairman of
         the meeting) or as to the entitlement of any Director (other than such
         Chairman) to vote or be counted in the quorum and such question is not
         resolved by


                                       21
<PAGE>   24

         his voluntarily agreeing to abstain from voting or not to be counted in
         the quorum, such question shall be referred to the Chairman of the
         meeting and his ruling in relation to such other Director shall be
         final and conclusive except in a case where the nature or extent of the
         interest of the Director concerned as known to such Director has not
         been fairly disclosed to the Board. If any question as aforesaid shall
         arise in respect of the Chairman of the meeting such question shall be
         decided by a resolution of the Board (for which purpose such Chairman
         shall not be counted in the quorum and shall not vote thereon) and such
         resolution shall be final and conclusive except in a case where the
         nature or extent of the interest of such Chairman as known to such
         chairman has not been fairly disclosed to the Board.

109      A Director may continue to be or become a director, managing director,
         joint managing director, executive director or manager or other officer
         or member of any other company in which the Company is interested, and
         (unless otherwise agreed) shall not be liable to account to the Company
         for any remuneration or other benefits received by him as a director,
         managing director, joint managing director, executive director, manager
         or other officer or member of any such other company. The Board may
         exercise the voting powers conferred by the shares in any other company
         held or owned by the Company or exercisable by it as directors of such
         other company in such manner as in all respects as the Board thinks fit
         (including the exercise thereof in favour of any resolution appointing
         themselves or any of them directors, managing directors, joint managing
         directors, deputy managing directors, executive directors, managers or
         other officers of such company) and any director may vote in favour of
         the exercise of such voting rights in manner aforesaid notwithstanding
         that he may be, or be about to be, appointed a director, managing
         director, joint managing director, deputy managing director, executive
         director, manager or other officer of such a company, and that as such
         he is or may become interested in the exercise of such voting rights in
         manner aforesaid. A Director of the Company may be or become a director
         of any company promoted by the Company or in which it may be interested
         as a vendor, shareholder or otherwise and no such Director will be
         accountable for any benefits received as a director or member of such
         company. A Director of the Company or his firm may not act as auditor
         of the Company.

                CHIEF EXECUTIVE OFFICERS AND OTHER APPOINTMENTS

110      The Directors may, from time to time, appoint one or more of their
         number to be Chief Executive Officer or Joint Chief Executive Officer
         of the Company, or to hold such office in the management,
         administration or conduct of the business of the Company as they may
         decide, and for such period and upon such terms and for such
         remuneration as the Directors shall think fit, and the Directors may
         also, from time to time (subject to the provisions of any agreement
         between him or them and the Company) remove him or them from office,
         and appoint another or others in his or their place or places.

111      A Chief Executive Officer or a Joint Chief Executive Officer (subject
         to the provisions of any agreement between him and the Company) shall
         be subject to the same provisions as to resignation and removal as the
         other Directors of the Company, and shall ipso facto and immediately
         cease to be Chief Executive Officer or Joint Chief Executive Officer if
         he shall cease to hold the office of Director.

112      The Directors may, from time to time, entrust to and confer upon any
         Chief Executive Officer, Joint Chief Executive Officer or Director,
         holding any other office in the management, administration or conduct
         of the business of the Company, such of the powers exercisable under
         these Articles by the Directors as they may think fit, and may confer
         such powers for such time, and to be exercised for such objects and
         purposes, and upon such terms and conditions and with such restrictions
         as they may consider expedient, and may from time to time revoke,
         withdraw, alter or vary all or any of such powers.


                                       22
<PAGE>   25

                            PROCEEDINGS OF DIRECTORS

113      The Directors may meet together for the despatch of business, adjourn
         and otherwise regulate their meetings as they think fit, and determine
         the quorum necessary for the transaction of business. Until otherwise
         determined by the Board, two Directors shall constitute a quorum. For
         the purpose of this Article an alternate Director shall be counted in a
         quorum but, notwithstanding that an alternate Director is also a
         Director or is an alternate for more than one Director, he shall for
         quorum purposes count as only one Director. Matters arising at any
         meeting shall be decided by a majority of votes. In case of an equality
         of votes the Chairman of the meeting shall have a second or casting
         vote. A Director or the Secretary may, at any time, summon a meeting of
         the Directors. A meeting of the Board or any committee of the Board may
         be held by means of such telephone, electronic or other communication
         facilities as permit all persons participating in the meeting to
         communicate with each other simultaneously and instantaneously, and
         participation in such a meeting shall constitute presence in person at
         such meeting.

114      Notice of a meeting of Directors shall be deemed to be duly given to a
         Director if it is given to him personally, in writing or by word of
         mouth, or sent to him at his last known address or any other address
         given by him to the Company for this purpose provided that notice need
         not be given to any Director or alternate Director for the time being
         absent from Hong Kong. A Director may consent to short notice of and
         may waive notice of any meeting and any such waiver may be
         retrospective.

115      The Directors may elect a Chairman of the Board and determine the
         period for which he is to hold office; but if no such Chairman be
         elected, or if at any meeting the Chairman be not present within five
         minutes after the time appointed for holding the same, the Directors
         present shall choose one of their number to be Chairman of such
         meeting.

116      A resolution in writing signed by all the Directors except such as are
         absent from Hong Kong or temporarily unable to act through ill health
         or disability (or their alternate Directors) shall (so long as they
         constitute a quorum) be as effective for all purposes as a resolution
         of the Directors passed at a meeting duly convened, held and
         constituted. A written notification of confirmation of such resolution
         in writing signed by a Director shall be deemed to be his signature to
         such resolution in writing for the purposes of this Article. Such
         resolution in writing may consist of several documents, each signed by
         one or more Directors.

117      A meeting of the Directors at which a quorum is present shall be
         competent to exercise all the powers, authorities and discretions for
         the time being vested in or exercisable by the Board generally.

118      The Directors may, from time to time, appoint committees consisting of
         such one or more persons as they think fit, and may delegate any of
         their powers to any such committee and, from time to time, revoke any
         such delegation and discharge any such committee wholly or in part. Any
         committee so appointed shall, in the exercise of the powers so
         delegated, conform to any regulations that may, from time to time, be
         imposed upon it by the Directors. All acts done by any such committee
         in conformity with such regulations and in fulfilment of the purposes
         for which it is appointed, but not otherwise, shall have the like force
         and effect as if done by the Board, and the Board shall have power,
         with the consent of the Company in general meeting, to remunerate the
         members of any special committee, and charge such remuneration to the
         current expenses of the Company.

119      The meetings and proceedings of any such committee consisting of two or
         more members shall be governed mutatis mutandis by the provisions of
         these Articles regulating the meetings and proceedings of the
         Directors, insofar as the same are not superseded by any regulations
         made by the Directors under the last preceding Article.


                                       23
<PAGE>   26

120      All acts done bona fide by any meeting of the Directors or of a
         committee of Directors, or by any persons acting as Directors, shall,
         notwithstanding that there was some defect in the appointment of any
         such Directors or persons acting as aforesaid, or that they or any of
         them were disqualified, or had vacated office, be as valid as if every
         such person had been duly appointed and was qualified and continued to
         be a Director.

                                    MINUTES


121      The Directors shall cause to be entered and kept in books provided for
         the purpose minutes of the following:-

         (a)      all appointments of officers;

         (b)      all the names of the Directors and any alternate Director who
                  is not also a Director present at each meeting of the
                  Directors and of any committee; and

         (c)      all resolutions and proceedings of general meetings and of
                  meetings of the Directors and committees.

         Any such minutes of any meeting of the Directors, or of any committee,
         or of the Company, if purporting to be signed by the Chairman of such
         meeting, or by the Chairman of the next succeeding meeting shall be
         receivable as evidence of the proceedings of such meeting.

                                    THE SEAL

122      The Directors shall procure a common seal to be made for the Company,
         and shall provide for the safe custody thereof. The Seal shall not be
         affixed to any instrument except by the authority of the Directors or a
         committee authorised by the Board in that behalf, and every instrument
         to which the Seal shall be affixed shall be signed by one Director or
         some other person nominated by the Directors for the purpose, provided
         that the Board may either generally or in any particular case or cases
         resolve (subject to such restrictions as to the manner in which the
         seal may be affixed as the Board may determine) that such signature may
         be affixed to certificates for shares or debentures or representing any
         other form of security by some mechanical means other than autographic
         to be specified in such resolution or that such certificates need not
         be signed by any person. Every instrument executed in manner provided
         by this Article shall be deemed to be sealed and executed with the
         authority of the Directors previously given.

123      The Company may have an official seal for use for sealing certificates
         for shares or other securities issued by the Company as permitted by
         section 73A of the Ordinance (and no signature of any Director, officer
         or other person and no mechanical reproduction thereof shall be
         required on any such certificates or other document to which such
         official seal is affixed and such certificates or other document shall
         be valid and deemed to have been sealed and executed with the authority
         of the Board notwithstanding the absence of any such signature or
         mechanical reproduction as aforesaid) and an official seal for use
         abroad under the provisions of the Ordinance where and as the Board
         shall determine, and the Company may by writing under the seal appoint
         any agents or agent, committees or committee abroad to be the duly
         authorised agents of the Company for the purpose of affixing and using
         such official seal and may impose such restrictions on the use thereof
         as may be thought fit. Wherever in these Articles reference is made to
         the seal, the reference shall, when and so far as may be applicable, be
         deemed to include any such official seal as aforesaid.

124      The Company may exercise all the powers of having official seals
         conferred by the Ordinance and such powers shall be vested in the
         Directors.


                                       24
<PAGE>   27

                                   SECRETARY

125      The Directors shall appoint such person, persons or entities to be
         Secretary or Joint Secretaries of the Company for such period, at such
         remuneration and upon such conditions as they may think fit, and any
         Secretary or Joint Secretaries so appointed may be removed by them.
         Anything by the Ordinance or these Articles required or authorised to
         be done by or to the Secretary or Joint Secretaries, if the office is
         vacant or there is for any other reason no person capable of acting in
         the capacity as Secretary or Joint Secretaries, may be done by or to
         any assistant or deputy Secretary, or if there is no assistant or
         deputy Secretary capable of acting, by or to any officer of the Company
         authorised generally or specially in that behalf by the Board.

                             DIVIDENDS AND RESERVES

126      The Company may by ordinary resolution declare dividends but no such
         dividend shall exceed the amount recommended by the Directors.

127      Unless and to the extent that the rights attached to any shares or the
         terms of issue thereof otherwise provide, all dividends shall (as
         regards any shares not fully paid throughout the period in respect of
         which the dividend is paid) be apportioned and paid pro rata according
         to the amounts paid on the shares during any portion or portions of the
         period in respect of which the dividend is paid. For the purposes of
         this Article no amount paid on a share in advance of calls shall be
         treated as paid on the share.

128      The Directors may retain any dividend or other monies payable on or in
         respect of a share on which the Company has a lien, and may apply the
         same in or towards satisfaction of the debts and liabilities in respect
         of which the lien exists. The Board may deduct from any dividend or
         bonus payable to any member all sums of money (if any) presently
         payable by him to the Company on account of calls, instalments or
         otherwise.

129      Any resolution declaring a dividend on shares of any class, whether a
         resolution of the Company in general meeting or a resolution of the
         Directors, may specify that the same shall be payable to the persons
         registered as the holders of such shares at the close of business on a
         particular date, notwithstanding that it may be a date prior to that on
         which the resolution is passed, and thereupon the dividend shall be
         payable to them in accordance with their respective holdings so
         registered, but without prejudice to the rights inter se in respect of
         such dividend of transferors and transferees of any such shares. The
         provisions of this Article shall mutatis mutandis apply to
         capitalisations to be effected in pursuance of these Articles.

130      Any general meeting sanctioning a dividend may make a call on the
         members of such amount as the meeting fixes, but so that the call on
         each member shall not exceed the dividend payable to him, and so that
         the call shall be made payable at the same time as the dividend, and
         the dividend may, if so arranged between the Company and the member, be
         set off against the call.

131      (a)      In respect of any dividend which the Board has resolved to pay
                  or any dividend declared or sanctioned or proposed to be
                  declared or sanctioned by the Board or by the Company in
                  general meeting, the Board may determine and announce, prior
                  to or contemporaneously with the announcement, declaration or
                  sanction of the dividend in question:

                  either

                  (i)      that shareholders entitled thereto will receive in
                           lieu of such dividend (or such part thereof as the
                           Board may think fit) an allotment of shares credited
                           as fully paid provided that the shareholders are at
                           the same time accorded the right to elect to


                                       25
<PAGE>   28

                           receive such dividend (or part thereof as the case
                           may be) in cash in lieu of such allotment. In such
                           case, the following provisions shall apply:-

                           (A)      the basis of any such allotment shall be
                                    determined by the Board;

                           (B)      the Board, after determining the basis of
                                    allotment and notwithstanding that the
                                    number of shares to be allotted may not be
                                    calculated until after notice to the
                                    shareholders has been given as required by
                                    the provisions of this sub-paragraph and
                                    subject to the provisions of sub-paragraph
                                    (D) below, shall given notice in writing to
                                    the shareholders of the right of election
                                    accorded to them and shall send with such
                                    notice forms of election and specify the
                                    procedure to be followed and the place at
                                    which and the latest date and time by which
                                    duly completed forms of election must be
                                    lodged in order to be effective which shall
                                    be not less than two weeks from the date on
                                    which the notice above referred to was
                                    despatched to the shareholders;

                           (C)      the right of election accorded to
                                    shareholders as aforesaid may be exercised
                                    in whole or in part;

                           (D)      the Board may resolve:-

                                    (I)      that the right of election accorded
                                             to shareholders as aforesaid may be
                                             exercised so as to take effect on
                                             all future occasions (if any) when
                                             the Board makes a determination
                                             pursuant to sub-paragraph (i) of
                                             this paragraph (a); and/or

                                    (II)     that a shareholder who does not
                                             exercise the right of election
                                             accorded to him as aforesaid either
                                             in whole or in part may notify the
                                             Company that he will not exercise
                                             the right of election accorded to
                                             him in respect of all future
                                             occasions (if any) when the Board
                                             makes a determination pursuant to
                                             sub-paragraph (i) of this paragraph
                                             (a) of this Article.

                                    Provided that a shareholder may exercise
                                    such election or give such notice in respect
                                    of all but not some of the shares held by
                                    him and may at any time give seven days
                                    notice in writing to the Company of the
                                    revocation of such an election or such a
                                    notice which revocation shall take effect at
                                    the expiry of such seven days, and until
                                    such revocation has taken effect, the Board
                                    shall not be obligated to give to such
                                    shareholder notice of the right of election
                                    accorded to him or send to him any form of
                                    election;

                           (E)      the dividend (or that part of the dividend
                                    in lieu of which an allotment of shares is
                                    to be made as aforesaid) shall not be
                                    payable in cash on shares in respect whereof
                                    the cash election has not been duly
                                    exercised (the "NON-ELECTED SHARES") and in
                                    lieu thereof shares shall be allotted
                                    credited as fully paid to the holders of the
                                    Non-Elected Shares on the basis of allotment
                                    determined as aforesaid and for such purpose
                                    the Board shall capitalise and apply out of
                                    the amount standing to the credit of share
                                    premium account or out of any part of the
                                    undivided profits of the Company (including
                                    profits carried and standing to the credit
                                    of any reserve or reserves or other special
                                    account) as the Board may determine, a sum
                                    equal to the aggregate nominal amount of
                                    shares to be allotted on such basis and
                                    apply the same in paying up in full the
                                    appropriate number of unissued shares for
                                    allotment and distribution to and amongst
                                    the holders of the Non-Elected Shares on
                                    such basis;


                                       26
<PAGE>   29

                           (F)      the Board may resolve that the shares to be
                                    allotted shall be allotted at a premium
                                    provided that the premium is credited as
                                    fully paid up and in such case the Board
                                    shall in addition to the amount to be
                                    capitalised and applied pursuant to
                                    sub-paragraph (E) above, and for the
                                    purposes therein set out, capitalise and
                                    apply out of the amount standing to the
                                    credit of the share premium account or out
                                    of any part of the undivided profits of the
                                    Company (including profits carried and
                                    standing to the credit of any reserve or
                                    reserves or other special account) as the
                                    Directors may determine, a sum equal to the
                                    aggregate amount of the premium on the
                                    shares to be allotted and shall apply the
                                    same together with the sum to be applied
                                    pursuant to sub-paragraph (E) above and on
                                    the basis therein set out in paying up in
                                    full the appropriate number of unissued
                                    shares for allotment and distribution to and
                                    amongst the holders of the Non-Elected
                                    Shares;

                  or

                  (ii)     that shareholders entitled to such dividend be
                           entitled to elect to receive an allotment of shares
                           credited as fully paid in lieu of the whole or such
                           part of the dividend as the Board may think fit. In
                           such case, the following provisions shall apply:-

                           (A)      the basis of any such allotment shall be
                                    determined by the Board;

                           (B)      the Board, after determining the basis of
                                    allotment and notwithstanding that the
                                    number of shares to be allotted may not be
                                    calculated until after notice to the
                                    shareholders has been given as required by
                                    the provisions of this sub-paragraph and
                                    subject to the provisions of sub-paragraph
                                    (D) below, shall give notice in writing to
                                    the shareholders of the right of election
                                    accorded to them and shall send with such
                                    notice forms of election and specify the
                                    procedure to be followed and the place at
                                    which and the latest date and time by which
                                    duly completed forms of election must be
                                    lodged in order to be effective which shall
                                    be not less than two weeks from the date on
                                    which the notice above referred to was
                                    despatched to the shareholders;

                           (C)      the right of election accorded to
                                    shareholders as aforesaid may be exercised
                                    in whole or in part;

                           (D)      the Board may resolve;

                                    (I)      that the right of election accorded
                                             to shareholders as aforesaid may be
                                             exercised so as to take effect on
                                             all future occasions (if any) when
                                             the Board makes a determination
                                             pursuant to sub-paragraph (ii) of
                                             this paragraph (a); and/or

                                    (II)     that a shareholder who does not
                                             exercise the right of election
                                             accorded to him as aforesaid either
                                             in whole or in part may notify the
                                             Company that he will not exercise
                                             the right of election accorded to
                                             him in respect of all future
                                             occasions (if any) when the Board
                                             makes determination pursuant to
                                             sub-paragraph (ii) of paragraph
                                             (a).

                                    Provided that a shareholder may exercise
                                    such election or give such notice in respect
                                    of all but not some of the shares held by
                                    him and may at any time give seven days
                                    notice in writing to the Company of the
                                    revocation of such an election or such a
                                    notice which revocation shall take effect at
                                    the expiry of such seven days, and until
                                    such revocation has taken effect, the Board
                                    shall


                                       27
<PAGE>   30

                                    not be obliged to give to such member notice
                                    of the right of election accorded to him or
                                    send to him any form of election;

                           (E)      the dividend (or that part of the dividend
                                    in respect of which a right of election has
                                    been accorded) shall not be payable on
                                    shares in respect whereof the share election
                                    has been duly exercised (the "ELECTED
                                    SHARES") and in lieu thereof shares shall be
                                    allotted credited as fully paid to the
                                    holders of the Elected Shares on the basis
                                    of allotment determined as aforesaid and for
                                    such purpose the Board shall capitalise and
                                    apply out of the amount standing to the
                                    credit of share premium account or out of
                                    any part of the undivided profits of the
                                    Company (including profits carried and
                                    standing to the credit of any reserve or
                                    reserves or other special account) as the
                                    Board may determine, a sum equal to the
                                    aggregate nominal amount of shares to be
                                    allotted on such basis and apply the same in
                                    paying up in full the appropriate number of
                                    unissued shares for allotment and
                                    distribution to and amongst the holders of
                                    the Elected Shares on such basis;

                           (F)      the Board may resolve that the shares to be
                                    allotted shall be allotted at a premium
                                    provided that the premium is credited as
                                    fully paid up and in such case the Board
                                    shall in addition to the amount to be
                                    capitalised and applied pursuant to
                                    sub-paragraph (E) above, and for the purpose
                                    therein set out, capitalise and apply out of
                                    the amount standing to the credit of the
                                    share premium account or out of any part of
                                    the undivided profits of the Company
                                    (including profits carried and standing to
                                    the credit of any reserve or reserves or
                                    other special account) as the Board may
                                    determine, a sum equal to the aggregate
                                    amount of the premium on the shares to be
                                    allotted and shall apply the same together
                                    with the sum to be applied pursuant to
                                    sub-paragraph (E) above and on the basis
                                    therein set out in paying up in full the
                                    appropriate number of unissued shares for
                                    allotment and distribution to and amongst
                                    the holders of the Elected Shares.

         (b)      The shares allotted pursuant to the provisions of paragraph
                  (a) of this Article shall rank pari passu in all respects with
                  the fully paid shares then in issue save only as regards
                  participation:-

                  (i)      in the relevant dividend (or the right to receive or
                           to elect to receive an allotment of shares in lieu
                           thereof as aforesaid); or

                  (ii)     in any other distributions, bonuses or rights paid,
                           made, declared or announced prior to or
                           contemporaneously with the payment or declaration of
                           the relevant dividend

                  unless, contemporaneously with the announcement by the Board
                  of its proposal to apply the provisions of sub-paragraph (i)
                  or (ii) of paragraph (a) of this Article in relation to the
                  relevant dividend or contemporaneously with their announcement
                  of the distribution, bonus or rights in question, the Board
                  shall specify that the shares to be allotted pursuant to the
                  provisions of paragraph (a) of this Article shall rank for
                  participation in such distribution, bonus or rights.

         (c)      The Board may do all acts and things considered necessary or
                  expedient to give effect to any capitalisation pursuant to the
                  provisions of paragraph (a) of this Article with full power to
                  the Board to make such provisions as they think fit in the
                  case of shares becoming distributable in fractions (including
                  provisions whereby, in whole or in part, fractional
                  entitlements are aggregated and sold and the net proceeds
                  distributed to those entitled, or are disregarded or rounded
                  up or down or whereby the benefit of


                                       28
<PAGE>   31

                  fractional entitlements accrues to the Company rather than to
                  the members concerned). The Board may authorise any person to
                  enter into on behalf of all members interested, an agreement
                  with the Company providing for such capitalisation and matters
                  incidental thereto and any agreement made pursuant to such
                  authority shall be effective and binding on all concerned.

         (d)      The Company may upon the recommendation of the Board by
                  ordinary resolution resolve in respect of any one particular
                  dividend of the Company that notwithstanding the provisions of
                  paragraph (a) of this Article a dividend may be satisfied
                  wholly in the form of an allotment of shares credited as fully
                  paid up without offering any right to shares to elect such
                  dividend in cash in lieu of such allotment.

         (e)      The Board may on any occasion when it makes a determination
                  pursuant to paragraph (a) of this Article, resolve that no
                  allotment of shares or rights of election for shares to be
                  issued pursuant to such determination shall be made available
                  or made to any shareholders with registered addresses in any
                  particular territory or territories or to a Depositary where
                  the allotment of shares or the circulation of an offer of such
                  rights of election would or might, in the opinion of the
                  Board, be unlawful or would or might, in the opinion of the
                  Board, be unlawful in the absence of a registration statement
                  or other special formalities, and in such event the provision
                  aforesaid shall be read and construed subject to such
                  resolution and the only entitlement of shareholders in any
                  such territory or territories shall be to receive in cash the
                  relevant dividend resolved to be paid or declared.
                  "DEPOSITARY" means a custodian or other person (or a nominee
                  for such custodian or other person) appointed under
                  contractual arrangements with the Company or other
                  arrangements approved by the Board whereby such custodian or
                  other person or nominee holds or is interested in shares of
                  the Company or rights or interests in shares of the Company
                  and issues securities or other documents of title or otherwise
                  evidencing the entitlement of the holder thereof to or to
                  receive such shares, rights or interests, provided and to the
                  extent that such arrangements have been approved by the Board
                  for the purpose of these Articles and shall include, where
                  approved by the Board, the trustees (acting in their capacity
                  as such) of any employees' share scheme established by the
                  Company or any other scheme or arrangements principally for
                  the benefit of employees of the Company and/or its
                  subsidiaries which have been approved by the Board.

         (f)      The Board may at any time resolve to cancel all (but not some
                  only) of the elections made and the notices given by the
                  shareholders pursuant to sub-paragraphs (i)(D) and (ii)(D) of
                  paragraph (a) of this Article by giving seven days notice in
                  writing to the relevant shareholders.

         (g)      The Board may on any occasion determine that rights of
                  election under paragraph (a) of this Article shall not be made
                  available to shareholders who are registered in the register
                  of shareholders, or in respect of shares the transfer of which
                  is registered, after a date fixed by the Board and in such
                  event the provisions aforesaid shall be read and construed
                  subject to such determination.

132      No dividend shall be payable except out of the profits or other
         distributable reserves of the Company, and no dividend shall bear
         interest as against the Company.

133      The Directors may, if they think fit, from time to time, resolve to pay
         to the members such interim dividends as appear to the Directors to be
         justified by the reserves of the Company. If at any time the share
         capital of the Company is divided into different classes the Directors
         may resolve to pay such interim dividends in respect of those shares in
         the capital of the Company which confer on the holders thereof deferred
         or non-preferred rights as well as in respect of those shares which


                                       29
<PAGE>   32

         confer on the holders thereof preferential or special rights in regard
         to dividend, and provided that the Directors act bona fide they shall
         not incur any responsibility to the holders of shares conferring a
         preference for any damage that they may suffer by reason of the payment
         of an interim dividend on any shares having deferred or non-preferred
         rights. The Directors may also resolve to pay at half-yearly or at
         other suitable intervals to be settled by them any dividend which may
         be payable at a fixed rate if they are of the opinion that the reserves
         of the Company justify the payment.

134      All dividends unclaimed for one year after having become payable may be
         invested or otherwise made use of by the Directors for the benefit of
         the Company until claimed, and all dividends unclaimed for six years
         after having become payable may be forfeited by the Directors and shall
         revert to the Company. The payment into a separate account of any
         monies payable in respect of a dividend shall not constitute the
         Company a trustee in respect thereof for any person.

135      Unless otherwise directed any dividend or other monies payable in cash
         on or in respect of a share may be paid by cheque or warrant sent
         through the post to the registered address of the member or person
         entitled, or, in the case of joint holders, to the registered address
         of that one whose name stands first on the Register in respect of the
         joint holding, or addressed to such person at such address as the
         holder or joint holders shall direct. The Company shall not be liable
         or responsible for any cheque or warrant lost in transmission nor for
         any dividend or other monies lost to the member or person entitled
         thereto by the forged endorsement of any cheque or warrant. Payment of
         the cheque or warrant by the banker on whom it is drawn shall be a good
         discharge to the Company.

136      The Directors may distribute in specie or in kind among the members in
         satisfaction in whole or in part of any dividend any of the assets of
         the Company, and in particular any shares or securities of other
         companies to which the Company is entitled and where any difficulty
         arises in regard to the distribution the Board may settle the same as
         it thinks expedient, and in particular may issue fractional
         certificates, disregard fractional entitlements or round the same up or
         down, and may fix the value for distribution of such specific assets,
         or any part thereof, and may determine that cash payments shall be made
         to any members upon the footing of the value so fixed in order to
         adjust the rights of all parties, and may vest any such specific assets
         in trustees as may seem expedient to the Board and may appoint any
         person to sign any requisite instruments of transfer and other
         documents on behalf of the persons entitled to the dividend and such
         appointment shall be effective. Where required, a contract shall be
         filed in accordance with the provisions of the Ordinance and the Board
         may appoint any person to sign such contract on behalf of the persons
         entitled to the dividend and such appointment shall be effective.

137      Before recommending a dividend the Directors may set aside any part of
         the net profits of the Company to one or more reserves, and may apply
         the same either by employing it in the business of the Company or by
         investing it in such manner as they shall think fit and the income
         arising from such reserves shall be treated as part of the profits of
         the Company. Such reserves may be applied for the purpose of
         maintaining the property of the Company, replacing wasting assets,
         meeting contingencies, forming an insurance fund, equalising dividends,
         paying special dividends, or for any other purpose for which the
         undivided profits of the Company may lawfully be used, and until the
         same shall be so applied it shall be deemed to remain undivided profit.
         The Directors may also carry forward as undivided profit any profit or
         balance of profit which they shall not think fit to recommend as
         dividend or to place to reserve.

                          AUTHENTICATION OF DOCUMENTS

138      Any Director or the Secretary or other authorised officer of the
         Company shall have power to authenticate any documents affecting the
         constitution of the Company and any resolutions passed by the Company
         or the Directors or any committee, and any books, records, documents


                                       30
<PAGE>   33

         and accounts relating to the business of the Company, and to certify
         copies thereof or extracts therefrom as true copies of extracts; and
         where any books, records, documents or accounts are elsewhere than at
         the Office, the local manager or such other officer of the Company
         having the custody thereof shall be deemed to be the authorised officer
         of the Company as aforesaid. A document purporting to be a copy of a
         resolution or an extract from the minutes of a meeting of the Company
         or of the Directors or any local board or committee which is certified
         as aforesaid shall be conclusive evidence in favour of all persons
         dealing with the Company upon the faith thereof that such resolution
         has been duly passed or, as the case may be, that any minute so
         extracted is a true and accurate record of proceedings at a duly
         constituted meeting.

                        CAPITALISATION OF RESERVES ETC.

139      The Company in general meeting may upon the recommendation of the
         Directors resolve to capitalise any part of the Company's reserves or
         undivided profits not required for the payment or provision of the
         dividend on any shares with a preferential right to a dividend, and
         accordingly that such part be divided amongst the members who would
         have been entitled thereto if distributed by way of dividend and in the
         same proportions, on condition that the same be not paid in cash but be
         applied as a capitalisation issue either in or towards paying up any
         amounts for the time being unpaid on any shares held by such members
         respectively or paying up in full unissued shares or debentures or
         other securities of the Company to be allotted and distributed credited
         as fully paid to and amongst such members in the proportion aforesaid,
         or partly in one way and partly in the other:

         Provided that any amount standing to the credit of a share premium
         account or a capital redemption reserve fund may, for the purposes of
         this Article, only be applied in the paying up of unissued shares to be
         issued to members of the Company as fully paid-up shares.

140      Whenever such a resolution as aforesaid shall have been passed the
         Directors shall make all appropriations and applications of the
         reserves and undivided profits resolved to be capitalised thereby, and
         all allotments and issues of fully paid-up shares, debentures or other
         securities and generally shall do all acts and things required to give
         effect thereto.

141      For the purpose of giving effect to any resolution under Articles 136
         and 139 hereof the Directors may settle any difficulty which may arise
         in regard to the distribution or capitalisation issue as they think
         expedient, and in particular may issue fractional certificates, and may
         fix the value for distribution of any specific assets, and may
         determine that cash payments shall be made to any members based upon
         the value so fixed or that fractions of such value as the Directors may
         determine may be disregarded in order to adjust the rights of all
         parties, and may vest any such cash or specific assets in trustees upon
         such trusts for the persons entitled to the distribution or
         capitalisation issue as may seem expedient to the Directors. The
         provisions of the Ordinance in relation to the filing of contracts for
         allotment shall be observed, and the Directors may appoint any person
         to sign such contract on behalf of the persons entitled to share in the
         distribution or capitalisation issue, and such appointment shall be
         effective and binding upon all concerned, and the contract may provide
         for the acceptance by such persons of the shares, debentures or other
         securities to be allotted and distributed to them respectively in
         satisfaction of their claims in respect of the sum so capitalised.

                             ACCOUNTS AND AUDITORS

142      The Directors shall cause proper books of account to be kept with
         respect to:-

         (a)      all sums of money received and expended by the Company and the
                  matters in respect of which such receipt and expenditure take
                  place; and

         (b)      the assets and liabilities of the Company.


                                       31
<PAGE>   34

         Proper books shall not be deemed to be kept if there are not kept such
         books of accounts as are necessary to give a true and fair view of the
         transactions.

143      The Directors shall from time to time, in accordance with the
         provisions of the Ordinance, cause to be prepared and to be laid before
         the Company in general meeting such profit and loss accounts, balance
         sheets, group accounts (if any) and reports as are required by the
         Ordinance.

144      A copy of every balance sheet (including every document required by law
         to be annexed thereto) which is to be laid before the Company in
         general meeting, together with a copy of the Directors' report and a
         copy of the Auditors' report, shall not less than twenty-one days
         before the date of the meeting be sent to every member of, and every
         holder of debentures of, the Company and to all persons other than
         members or holders of debentures of the Company, being persons entitled
         to receive notices of general meetings of the Company:

         Provided that this Article shall not require a copy of those documents
         to be sent to any person of whose address the Company is not aware nor
         to more than one of the joint holders of any shares or debentures.

145      Auditors shall be appointed and their duties regulated in the manner
         provided by the Ordinance.

146      Subject as otherwise provided by the Ordinance the remuneration of the
         Auditors shall be fixed by the Company in general meeting provided
         always that in respect of any particular year the Company in general
         meeting may delegate the fixing of such remuneration to the Board.

147      Every statement of accounts audited by the Company's Auditors and
         presented by the Board at a general meeting shall after approval at
         such meeting be conclusive except as regards any error discovered
         therein within three months of the approval thereof. Whenever any such
         error is discovered within that period, it shall forthwith be
         corrected, and the statement of account amended in respect of the error
         shall be conclusive.

                                    NOTICES

148      Any notice or other document to be given or issued shall be in writing
         to the members, may be served by the Company upon any member either
         personally or by sending it by mail, postage prepaid, addressed to such
         member at his registered address, and, in any case where the registered
         address of a member is outside Hong Kong, by prepaid airmail.

149      Any notice sent by mail shall be deemed to have been served in the case
         where the member's registered address is in Hong Kong on the day
         following that on which the notice is mailed in Hong Kong and in any
         other case on the fifth day after the day of mailing. In proving such
         service it shall be sufficient to prove that the notice was properly
         addressed and mailed, postage prepaid.

150      Any person who, by operation of law, transfer or other means
         whatsoever, shall become entitled to any share shall be bound by every
         notice in respect of such share which, previously to his name and
         address being entered in the Register, shall be duly given to the
         person from whom he derives his title to such share.

151      Any notice or document delivered or sent by mail to, or left at the
         registered address of, any member, in pursuance of these Articles,
         shall, notwithstanding such member be then deceased or bankrupt, and
         whether or not the Company have notice of his decease or bankruptcy, be
         deemed to have been duly served in respect of any shares held by such
         member, whether held solely or jointly with other persons by such
         member, until some other person be registered in his stead as the
         holder or joint holder thereof, and such service shall for all purposes
         of these Articles be deemed a sufficient service of such notice or
         document on his executors, administrators or assigns and all persons
         (if any) jointly interested with him in any such share.


                                       32
<PAGE>   35

152      Any summons, notice, order or other document required to be sent to or
         served upon the Company, or upon any officer of the Company, may be
         sent or served by leaving the same or sending it through the post in a
         prepaid letter, envelope or wrapper, addressed to the Company or to
         such officer at the Office.

153      The signature to any notice to be given by the Company may be written
         or printed.

154      Subject to any special provisions contained in these Articles or in the
         Ordinance, all notices required to be given by advertisement shall be
         advertised in at least one daily Chinese and one daily English
         newspaper circulating in Hong Kong.

155      In reckoning the period for any notice given under these Articles, the
         day on which notice is served, or deemed to be served, and the day for
         which such notice is given shall be excluded.

                                   WINDING UP

156      If the Company shall be wound up, the surplus assets remaining after
         payment to all creditors shall be divided among the members in
         proportion to the capital paid up on the shares held by them
         respectively, and if such surplus assets shall be insufficient to repay
         the whole of the paid-up capital, they shall be distributed so that, as
         nearly as may be, the losses shall be borne by the members in
         proportion to the capital paid up on the shares held by them
         respectively. This Article is, however, subject to the rights of the
         holders of any shares which may be issued on special terms or
         conditions.

157      If the Company shall be wound up, the liquidator (whether voluntary or
         official) may, with the sanction of a special resolution, divide among
         the members in specie or kind the whole or any part of the assets of
         the Company or vest any part of the assets of the Company in trustees
         upon such trusts for the benefit of the members or any of them as the
         resolution shall provide. Any such resolution may provide for and
         sanction a distribution of any specific assets amongst different
         classes of members otherwise than in accordance with their existing
         rights, but each member shall in that event have a right of dissent and
         other ancillary rights in the same manner as if such resolution were a
         special resolution passed pursuant to section 237 of the Ordinance.

158      In the event of a winding-up of the Company in Hong Kong, every member
         of the Company who is not for the time being in Hong Kong shall be
         bound, within fourteen days after the passing of an effective
         resolution to wind up the Company voluntarily, or within the like
         period after the making of an order for the winding up of the Company,
         to serve notice in writing on the Company appointing some person
         resident in Hong Kong upon whom all summonses, notices, processes,
         orders and judgements in relation to or under the winding-up of the
         Company may be served and, in default of such nomination, the
         liquidator of the Company shall be at liberty on behalf of such member
         to appoint some such person, and service upon any such appointee shall
         be deemed to be a good personal service on such member for all
         purposes, and where the liquidator makes any such appointment he shall,
         with all convenient speed, give notice thereof to such member by
         advertising in such English language daily newspaper circulating in
         Hong Kong as he shall deem appropriate or by a registered letter sent
         through the post and addressed to such member at his address as
         appearing in the Register, and such notice shall be deemed to be served
         on the day on which the advertisement appears or the letter is posted.

                                   INDEMNITY

*159     Subject to the Provisions of the Ordinance, every Director or other
         officer of the Company shall be indemnified out of the assets of the
         Company against all costs, charges, expenses, losses and

--------------
  * Amended pursuant to a Special Resolution passed on 16 October 1997.


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<PAGE>   36

         and liabilities which he may sustain or incur in or about the execution
         of his office or otherwise in relation thereto and in particular and
         without prejudice to the generality of the foregoing every Director and
         other officer of the Company shall be indemnified by the Company
         against, and it shall be the duty of the Directors out of the funds of
         the Company to pay all costs, losses and expenses which any such
         Director and other officer may incur or become liable for by reason of
         any contract entered into, or act or thing done by him or them as such
         Director and other officer, or in any way in the discharge of their or
         his duties, including travelling expenses; and the amount for which
         such indemnity is provided shall immediately attach as a lien on the
         property of the Company, and have priority as between the members over
         all other claims. Any person who is a Director or other officer of the
         Company shall not be liable (except in consequence of his own
         dishonesty) for the acts, receipts, neglects or defaults of any other
         Director or other officer of the Company or for any losses or expenses
         incurred by the Company through the insufficiency or deficiency of
         title to any property acquired by order of the Directors for or on
         behalf of the Company, or for the insufficiency or deficiency of any
         security in or upon which any of the moneys of the Company shall be
         invested, or for any loss or damage arising from the bankruptcy,
         insolvency or tortious act of any person with whom any moneys,
         securities or effects of the Company shall be deposited or for any loss
         occasioned by any error of judgement, omission, default or oversight on
         their or his part, or for any other loss, damage or misfortune whatever
         which shall happen in the execution of the duties of his office or in
         relation thereto.

                            UNTRACEABLE SHAREHOLDERS

160      Without prejudice to the rights of the Company, the Company may cease
         sending such cheques for dividend entitlements or dividend warrants by
         post if such cheques or warrants have been left uncashed on two
         consecutive occasions. However, the Company may exercise the power to
         cease sending cheques for dividend entitlements or dividend warrants
         after the first occasion on which such a cheque or warrant is returned
         undelivered.

161      The Company shall have the power to sell, in such manner as the Board
         thinks fit, any shares of a shareholder who is untraceable, but no such
         sale shall be made unless:-

         (i)      all cheques or warrants, being not less than three in total
                  number, for any sum payable in cash to the holder of such
                  shares in respect of them sent during the relevant period in
                  the manner authorised by the Articles of Association of the
                  Company have remained uncashed;

         (ii)     so far as it is aware at the end of the relevant period, the
                  Company has not at any time during the relevant period
                  received any indication of the existence of the shareholder
                  who is the holder of such shares or of a person entitled to
                  such shares by death, bankruptcy or operation of law;

         (iii)    the Company has caused an advertisement to be inserted in
                  English in one English language daily newspaper and in Chinese
                  in one Chinese language daily newspaper (provided that the
                  aforesaid daily newspapers shall be included in the list of
                  newspapers issued and published in the Hong Kong Government
                  Gazette for the purpose of section 71A of the Ordinance)
                  advertising its intention to sell such shares and a period of
                  three months has elapsed since the date of such advertisement;
                  and

         (iv)     the Company has notified the stock exchange in the relevant
                  territory of its intention to effect such sale.

                  For the purpose of the foregoing, "RELEVANT PERIOD" means the
                  period commencing twelve years before the date of publication
                  of the advertisement referred to in paragraph (iii) of this
                  Article and ending at the expiry of the period referred to in
                  that paragraph.


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<PAGE>   37

         The manner, timing and terms of any sale of shares pursuant to this
         Article (including but not limited to the price or prices at which the
         same is made) shall be such as the Board determines, based upon advice
         from such bankers, brokers or other persons as the Board considers
         appropriate consulted by it for the purposes, to be reasonably
         practicable having regard to all the circumstances including the number
         of shares to be disposed of and the requirement that the disposal be
         made without delay and the Board shall not be liable to any person for
         any of the consequences of reliance on such advice.

162      To give effect to any such sale pursuant to Article 161 the Board may
         authorise any person to transfer the said shares and the instrument of
         transfer signed or otherwise executed by or on behalf of such person
         shall be as effective as if it had been executed by the registered
         holder or the person entitled by transmission to such shares, and the
         purchaser shall not be bound to see to the application of the purchase
         money nor shall his title to the shares be affected by any irregularity
         or invalidity in the proceedings relating to the sale. The net proceeds
         of the sale will belong to the Company and, upon receipt by the Company
         of such proceeds, it shall become indebted to the former shareholder by
         carrying all moneys in respect thereof to a separate account for an
         amount equal to such net proceeds. No trusts shall be created in
         respect of such debt and no interest shall be payable in respect of it
         and the Company shall not be required to account for any money earned
         form the net proceeds which may be employed in the business of the
         Company or as it thinks fit. Any sale under this Article shall include
         any additional shares which during the relevant period or during any
         period ending on the date when all the requirements of sub-paragraphs
         (i) to (iii) of Article 161 have been satisfied have been issued in
         respect of those held at the beginning of such relevant period and
         shall be valid and effective notwithstanding that the shareholder
         holding the shares sold is dead, bankrupt or otherwise under any legal
         disability or incapacity.


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<PAGE>   38


                NAMES, ADDRESSES AND DESCRIPTIONS OF SUBSCRIBERS

<TABLE>
<S>                                                <C>
China Telecom (Hong Kong) Group Limited            For and on behalf of
Hong Kong company no. 569288, of                   CHINA TELECOM (HONG KONG) GROUP LIMITED
16/F, Dah Sing Financial Centre,
108 Gloucester Road,
Wanchai, Hong Kong
                                                   (Sd.) Chen Zhaobin

CORPORATION                                        ----------------------------------------
                                                   Director



China Telecom Hong Kong (BVI) Limited              For and on behalf of
BVI I.B.C. company no. 244168, of                  CHINA TELECOM HONG KONG (BVI) LIMITED
P.O. Box 957, Offshore Incorporations Centre,
Road Town, Tortola, British Virgin Islands
                                                   (Sd.) Chen Zhaobin


CORPORATION                                        ----------------------------------------
</TABLE>



Dated the 29 day of August, 1997.




WITNESS to the above signatures

Celia C. L. Lam                     (Sd. Celia Lam)
Solicitor
Hong Kong

Address:

14th Floor, Alexandra House
Chater Road
Central
Hong Kong



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